Tag Archives: political economy

Economic Recovery

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What sort of recovery will we have in 2021 with the Wuhan Virus situation under control and, with the release of two vaccines (I’m betting on the come with Moderna as I write on Friday) and others in the nearby pipeline about to stamp the virus into the mud?

Jon Sindreu, in The Wall Street Journal, provided a couple of clues, although he was writing toward a different purpose. This graph of his is my first clue:

He fleshed that out with this:

Flow-of-funds data recently published by the Federal Reserve shows that companies have accumulated even more cash than debt this year: their liquid assets were up 25% in the third quarter. On a net basis, debt was down 7.9%. Relative to GDP, it remains well below 2007 levels.

Another clue:

Nor are property and asset prices tanking, hitting households’ net worth as they did in 2008. So consumers have kept spending when they could.

There’s more in his article, but the upshot is this: 2021’s recovery (and into the later years) won’t be nearly as weak as some have feared. It’ll be strongly positive, although—because of 2020’s already in-progress recovery—it’s unlikely to be quite as strong as hoped.

Bill de Blasio is Disappointed

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The Wuhan Virus bill under discussion in DC (as I write Thursday) doesn’t have any bailout money for States and municipalities. New York City Mayor Bill de Blasio isn’t happy about that.

What do we see right now in Washington? Endless discussion that now is leaving out all state and local aid, that means that city government, state government will not be able to get back on our feet and serve our people—it just doesn’t make any sense[.]

What do I see right now in New York City Hall? Endless tin cup rattling that continues to demand other people’s money.

To paraphrase (not very loosely) a man far more intelligent than any of us ordinary Americans,

…there’s plenty of money in [City Hall], it’s just in the wrong hands. Democrats have to fix that[.]

Indeed. De Blasio and his Progressive-Democrat-dominated city council (46 Progressive-Democrat councilmen out of 51 seats) have only to reallocate their spending priorities and their actual spending.

That they won’t—it just doesn’t make any sense.

The Willy Sutton Objection

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Facebook has joined with Epic Games in the latter’s lawsuit against Apple over how to charge—and who gets to make the charge—for apps installed on Apple’s iPhones. Facebook is doing so to further its feud with Apple over Apple’s decision to give iPhone users tools with which to protect their private information.

Facebook isn’t alone in the beef.

Apple has said starting early next year its iOS 14 operating system will give iPhone and iPad users the option to no longer share personal information that many developers rely on to tailor ads. When users open an app, they will see a message asking permission to track what other apps and websites they visit, their location, and other behaviors.
Apple’s plan has drawn criticism from a range of businesses and trade groups…saying that Apple’s plan was anticompetitive.

Because people moving to protect their private information from snooping and private enterprises moving to protect their products from being used as tools for the snooping is somehow anticompetitive.

It’s an objection that Willy Sutton would have loved: how anticompetitive of those banks to obstruct his business model?

Clarity

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Walter Russell Meade, with whom I agree far more often than not, had a piece in Monday’s Wall Street Journal. He titled his piece Can Biden Find Clarity on China and Russia? and he closed it with this:

The global governance issues that many on Team Biden care most about cannot be addressed without the hard-nosed geopolitics that many Democrats reject. The president-elect’s foreign policy will stand or fall on his ability to manage that paradox.

I think the answers to the question, and the fixing of the paradox, stem from Biden’s own words:

The PRC isn’t “a patch on our jeans.”
“[T]hey’re not bad folks, folks.”

Biden’s position on the PRC seems pretty clear to me.

The widow of a Moscow mayor sent Hunter Biden $3.5 million.
On Russia generally, Biden has this: “He [Romney] acts like he thinks the Cold War is still on [and] Russia is still our major adversary. I don’t know where he has been.”

Biden’s Russia position, which remains unchanged in deed, his current words notwithstanding—and the Russian hooks in his family—are equally clear.

Student Loans

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A letter writer in last Thursday’s Wall Street Journal Letters section had a thought.

There are some degrees that are worth borrowing money for, but many aren’t. Parents and students, do your homework.

Indeed. Lenders need to do their due diligence homework much more diligently, too. Two ways to incentivize (to coin a term) the lenders: get Government out of the business of making student loans and out of the business of guaranteeing others’ loans to students.

The other way is to require the school being borrowed for to attend to be the primary lender—ideally, the sole lender.