Category Archives: Economics

Miscellaneous economy stuff

The PRC and Facial Recognition

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The People’s Republic of China is moving “beyond” the use of smart phones for making on-the-spot retail payments, starting to supplant that with facial recognition—with personal images tied to personal financial accounts.

Ant Financial Services Group and Tencent Holdings Ltd, rivals that operate, respectively, Alipay and WeChat Pay, China’s two largest mobile-payments networks, are competing for dominance in the next stage of China’s cashless society. Each is racing to install its own branded facial-recognition screens at retail points-of-sale all over the country, marketing the screens as a way to speed up sales and improve efficiency.

Marketing the screens as a way to speed up sales and improve efficiency.  A way to speed up and broaden PRC government knowledge of what its citizens are doing, where they are going, what they’re spending their money on, where they have their money, also.  In fine, a way to extend the PRC’s ability to control, not just the population over which it reigns, or subgroups of it, but down to the individual level.  George Orwell knew about this, and about the debilitation it inflicts on liberty, even on moral and on morale.

This is not an advance over smart phone payments.  Not at all.

Green Cow Gas

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…or something.  The Wall Street Journal opined Monday on the alleged hypocrisy of California’s Progressive-Democrats on the matter of going carbon-neutral in a shade over a decade.

California has plowed billions of dollars into green energy to wean the state off fossil fuels. But now progressives are complaining that biofuel producers are milking government subsidies intended to help dairy farmers cut emissions. Here is another illustration of the left’s anti-carbon contradictions.

The Editors went on in that vein, describing those Progressive-Democrats’ dismay over two companies thoroughly dominating the cow manure and flatulence emissions carbon credits market, even taking advantage of California’s laws governing those emissions.

The Editors closed with this gem regarding those Progressive-Democrat greens:

California dairies have been shrinking due to the high costs of complying with environmental regulation and water restrictions. By subsidizing methane digesters, the state intended to prevent more dairy farmers from leaving the state for less green pastures. But green groups now say the subsidies will encourage farmers to increase their herds, which could cause more water and air pollution from manure….

I have to ask, then: haven’t these editors (and other critics) heard? Sniffing methane develops magical thinking powers.

Regulatory Capture

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…and campaign finance hypocrisy.  Regulatory capture is where companies subject to this or that regulatory body are large enough and financially successful enough to…influence…their regulators and guide the nature and scope of the regulations to which they, and their competitors, are subject.

The most recent presidential campaign filings show that [Senator Elizabeth, D, MA] Warren and [Senator, I, VT (or D, depending on which spin is current] Bernie Sanders—who has called for ramping up antitrust enforcement and taking on the big tech companies—have each attracted large amounts of contributions from people connected to Google and other tech companies.

As The Wall Street Journal noted just ahead of that cite,

No other candidate for the Democratic presidential nomination has been as eager to call for the breakup of Google as Sen. Elizabeth Warren.

Therein lies the hypocrisy: these two, along with many of their fellow Progressive-Democratic Party Presidential candidates, argue most vociferously for getting Big Money out of campaign finance.

Tariffs on Mexico

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There is some hue and cry over President Donald Trump’s threatened tariff on Mexico in an effort to get the Mexican government to take seriously its role in the crisis on our common border.

Critics of the tariffs, including those within the administration, have said the ratification of the pact would be threatened by the tariffs.

There’s no threat to ratification of the USMCA from these tariffs. There is a threat from the Progressive-Democrats who hate the treaty separately from this.  However, the lack of threat is illustrated by Mexico; since the tariff threat, that government has said it still intends to ratify the treaty.

On the other hand, critics of the present tariff threat are conflating the two purposes of tariffs. One is as protectionist devices; these are the tariffs that are targets of the USMCA, and they remain controlled by the agreement.

The other purpose is as a foreign policy tool used to induce another nation to do/not do the things identified by a particular tariff-as-foreign policy tool’s stated purpose.

The threatened tariff is not at all a protectionist tariff. On the contrary, it’s a foreign policy tool, a take-your-own-immigration-laws-seriously tariff.

Update: The foreign policy tool seems to have worked. Of course, we’ll have to see the realization over time, but that’s the case with all agreements.

Bad Policy

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Recall that President Donald Trump has threatened a sequence of rising tariffs on all Mexican goods in an effort to get Mexico to take seriously its broad contribution to the crisis we have on our border with that nation.

Republican lawmakers are gearing up for a vote to potentially override President Trump’s planned tariff on Mexico this month….

These lawmakers are concerned that the tariffs could jeopardize passage of the USMCA, and they’re worried that they will hurt Americans.  These folks have lost sight of some important facts.

One is that, after the announcement of the upcoming tariffs, the Mexican government said it intended to move ahead with ratification of the USMCA. The only ones in the way of its final acceptance are Congress’ Progressive-Democrats, who generally don’t like the deal in any event, and these Republicans.

Another is that international trade, including tools of international trade like tariffs, have nothing to do with economics and everything to do with foreign policy.

A third is the nature of conflict.  These Republicans need to understand that no conflict is bloodless for either side.   They need to stop worrying so much about their own stubbed toes and consider the effect these particular tariffs would have on Mexico and whether they just might have the intended effect.

Any attempt by Congress to get in the way can only undermine Trump’s foreign policy move to push Mexico to get serious about those whom Mexico is allowing illegally to cross its own southern border and the resulting flow of these illegal aliens north to illegally enter our country.

Senate Majority Whip John Thune (R, SD):

Congress is going to want to probably be heard from.

If Congress wants to be heard from, it should get serious about immigration, beginning with immigration legislation, that beginning with something akin to Trump’s offer of a year or so ago that offered a path to legalization for DACA beneficiaries plus a million more who were similarly situated.  Along with the means to better physically secure our own southern border.