Category Archives: political economy

“It Depends on Uncle Sam”

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Without more help from Washington, electric-vehicle sales will struggle to live up to the stock-market hype.

That Wall Street Journal lede pretty much tells the tale.

And this:

If the new technology is to live up to high investor expectations, the global record suggests that the US will need to embrace subsidies.

It depends on Uncle Sam. As long as electric vehicles get subsidies of any sort—either on the manufacturing end or to buyers of them on the other end—these battery cars can never be mainstream. As long as they’re getting any sort of subsidy, battery cars are tautologically unready for market.

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Inflation Worries

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Jason Furman, ex-President Barack Obama’s (D) Council of Economic Advisers Chairman, wrote about four things about which to worry regarding the current inflation increase and its durability. Three of them were reasonably accurate. He also predicted a Fed response.

First, the economy is beginning 2022 with much tighter labor markets than a year ago. …
Second, demand should remain above pre-pandemic trends, while supply will likely continue to lag behind. …
Third, consumers, businesses, forecasters and financial markets all expect near-term inflation to be about 1 to 3 percentage points higher than a year ago. …

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A Good Idea?

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Progressive-Democrats are looking at “adjusting” Party’s proposed child tax credit in order to appease Senator Joe Manchin (D, WV).

Some Democrats have started exploring how to pare back their proposed expansion of the child tax credit in ways that are aimed at winning the critical support of Sen. Joe Manchin (D., W.Va.), according to people familiar with the matter.
Among the possibilities: Reducing the size of the credit’s expansion and limiting which Americans are eligible for it, according to the people.

Tweaking to appease a single Senator. Never mind any effort at looking for bipartisan support.

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More Chit-Chat

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Cynically done chit-chat, too.

Biden-Harris says he’s going to distribute bunches more Wuhan Virus test kits to schools to keep them open.

The Biden administration plans to distribute millions of free Covid-19 tests to schools around the country, part of the federal government’s effort to keep schools open amid a surge in coronavirus cases caused by the Omicron variant.
Later this month, the administration will begin shipping five million rapid Covid-19 tests to K-12 schools each month, White House officials said.

That’s in contrast to this:

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Widening Gyre of Hostages

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In response to Lithuania’s effrontery in contradicting the People’s Republic of China by letting the Republic of China open a “representative office” in the capital city of Vilnius, the PRC not only is banning import into the PRC of Lithuanian products, it’s banning import of all products that contain Lithuanian components. As The Wall Street Journal dryly put it,

The effects are rippling across Europe.

And already Germany is intimating its desire for surrender, which should come as no surprise from a nation already openly obsequious before Russia:

The German-Baltic Chamber of Commerce has warned Vilnius that German subsidiaries are at risk.

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Usefulness

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Detroit plans on a big move into battery-operated cars and pickups, with Chrysler committing to go all battery all the time by 1928.

Aside from the enormous pollution, environmental damage, and carbon footprint of so-called electric cars, there are practical, driving-oriented considerations.

GM says its Silverado EV pickup will be able to go 400 miles on a charge, Rivian is claiming 314 miles for its R1T pickup, and Ford is claiming 300 miles for its F-150 Lightning pickup. Chrysler claims that one of its automobile models will have a range of some 400 miles before needing a recharge.

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Monthly Child-Tax Credit Payments at an End

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The Wall Street Journal wrote about the end of the child tax credit payments and the impact on families’ financial cushion during last year’s Wuhan Virus-related dislocation. What Ensign and Rubin missed in their piece, though, is what those payments actually are, and their upcoming impact.

Those monthly child-tax credit payments were advances on 2021’s income tax refunds. In addition to the cash flow (not income) drop from the payments’ cessation, payback of those advances on or about mid-April (or later, should the IRS decide to delay the due date for tax returns, again) will be a cast iron bitch for those lower income families whom the Progressive-Democrats were pretending to help with the advances.

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Blame-shifting to Middlemen

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Now Biden-Harris is throwing a billion dollars at the food supply chain problem, even as he’s blaming food supply chain middlemen for his supply problems.

This is just more blame-shifting by Biden-Harris.

Middlemen can, indeed, price gouge. So can end-sellers. So can original producers. However, in the vast main, middlemen drive prices lower: they insulate original producers from end sellers, giving those producers more flexibility in to whom to sell, the middlemen more choices to whom to sell, and they give end sellers more choices of from whom to buy. Competition among middlemen and on both sides of the middlemen drive prices down.

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Jobs and Unemployment

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Good times ahead in the working stiff department. Or are there?

The Labor Department’s latest employment report, to be released Friday, is projected to show employers added 405,000 jobs in December and the unemployment rate ticked down to 4.1%, according to economists surveyed by The Wall Street Journal.

4.1%: based on what labor force participation rate? That projection is left unreported, even though it’s a Critical Item in calculating the unemployment rate.

We’ll have to wait a couple of days to find out.

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A SpaceX Dyson Sphere?

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No, but something related to it. A Dyson sphere is a structure built around a star (our sun, for instance) that captures the star’s energy output for the use of the civilization that built the sphere.

Elon Musk, and his SpaceX company, are building a constellation of satellites—some 42,000 of them by the end game—in Earth orbit for the purpose of producing a global Internet, and one that’s separate from the terrestrial net.

Which brings me to my speculation.

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