Tag Archives: political economy

Nationalizing our Economy

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A city mayor wants the Federal government to nationalize critical parts of our economy.

New York City Mayor Bill de Blasio is arguing that the best way to tackle the coronavirus outbreak is for the federal government to take over critical private companies in the medical field and have them running 24 hours a day.
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“This is a case for a nationalization, literally a nationalization, of crucial factories and industries that could produce the medical supplies to prepare this country for what we need,” de Blasio told MSNBC‘s Joy Reid on Saturday, calling for “24/7 shifts” during what he called a “war-like situation.”

Just like the Progressive Theodore Roosevelt, who wanted to nationalize one-sixth of our then-economy, the railroads, because—presaging a later President—they’d made enough money and grown (in his personal view) too powerful.

Just like the Democrats Woodrow Wilson and Harry Truman, under the excuse of war that de Blasio is bastardizing—Wilson nationalizing all the factories east of the Mississippi until the Supreme Court overruled him and Truman trying to seize the steel industry until the Supreme Court blocked him.

Just like Progressive-Democrat Barack Obama, who nationalized a current sixth of our economy, our health insurance industry, in order to turn it into a Government mandated, privately funded welfare program.

Now the Progressive-Democrat Bill de Blasio is grasping at his excuse for Government to seize control of our economy.

What’s the Progressive-Democrats’ limiting principle on such nationalizations? Nor they nor their forebears have ever been willing to say. That leaves us to conclude that their limit is the natural limit: complete nationalization of all of our economy—rank, pure socialism.

Remember this power grab attempt in November.

An Illustration

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A businessman in the People’s Republic of China, Ren Zhiqiang—who also is a member of the Communist Party of China—has been for some time an outspoken critic of PRC President Xi Jinping’s handling of the nation’s COVID-19 epidemic, a mishandling that allowed an early infection to blow out of control within the PRC and to become a global pandemic.

Outspoken critic: among other things, Ren wrote a widely disseminated essay that took issue with a 23 Feb speech by Xi. He wrote of a

“crisis of governance” within China’s Communist Party and blamed restrictions on freedom of speech and the press for slowing down the response to combat the novel coronavirus, thereby worsening the outbreak.

And

…after analyzing the President’s [Xi’s] speech he “saw not an emperor standing there exhibiting his ‘new clothes,’ but a clown stripped naked who insisted on continuing being emperor[.]”

Then Ren posted on Weibo

When does the people’s government turn into the party’s government? … Don’t waste taxpayers’ money on things that do not provide them with services.

Then his post was deleted, his Weibo account blocked. Ren also has been put on “probation” from the CPC.

And now he’s gone missing, making his point beautifully.

Some Coronavirus Perspective

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To put some perspective on national coronavirus infection levels, I’ve picked out some nations that have been in the news lately.  Coronavirus cases are drawn from Johns Hopkins University as of 14 March, and the population data are from Wikipedia. The per capita normalization is from third grade arithmetic.

I’ve emphasized one nation of particular interest.

Population Coronavirus Cases Per Capita Cases (per 10,000) Deaths Per Cent Deaths per Case
People’s Republic of China 1,427,647,786 80,976 0.56720 3,189 3.93820%
Germany 83,149,300 3,758 0.45196 8 0.21288%
US  328,239,523 2,175 0.06626 47 2.16092%
Japan 126,150,000 725 0.05747 21 2.89655%
Republic of Korea 51,709,098 8,086 1.56375 72 0.89043%
Italy 60,317,546 17,660 2.92784 1,266 7.16874%
Republic of China 23,780,452 53 0.02229 1 1.88679%
Iran 83,183,741 12,729 1.53023 611 4.80006%

Biden and the Sanders Supporters

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In the end game of the Progressive-Democratic Party’s Presidential primary contest—and, yes, at this stage, Party is down to three contestants, with Party’s elite choosing to freeze Congresswoman Tulsi Gabbard (D, HI) out of the contest, she being too willing to speak freely and honestly and too far behind for her axis of approach to counter Senator Bernie Sanders’ (I, VT), the end game is on us—the question arises whether Joe Biden, front runner, can win over Sanders’ supporters, who are every bit as ardent and critically large in number as the NLMSM makes them out to be. Those supporters, after all, will be critical in the general election if Biden is to be electable in the general election.

Here are a couple of critical considerations for that question.

Mr Biden’s agenda is indistinguishable from Mrs Clinton’s and thus anathema to the left Democratic base.

And

he [Biden] has to…persuade them that he’ll bring them to the table and push for a substantial part of their agenda.

This explicit promise, especially, illustrates how strongly Biden stands foursquare against everything that Sanders and his supporters stand for:

Mr Biden recently told MSNBC that he would veto a Medicare for All bill if it crossed his desk.

He can’t, though, move to bring Sanders’ supporters across that gaping chasm. If he makes a credible push for the Left’s agenda, for Sanders’ agenda, he’ll betray his own supporters. That betrayal will demonstrate to both his own supporters and Sanders’ that he cannot be trusted. More broadly, that betrayal will demonstrate to all voters in the general election that he cannot be trusted: he’ll just change his policy positions according to what benefits him personally in the moment.

That stands in sharp contrast with Sanders who, regardless of what anyone might think of his positions and policies, has remained steadfast in those positions and policies, regardless of any fickle political winds.

We’ll get a clue, maybe, in tomorrow’s Progressive-Democratic Party debate in DC.

Currency Swaps and the Federal Reserve’s Role

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The currency swaps, the foreign exchange swaps, discussed here are a lifeline our Federal Reserve Bank system extended to other nations during the Panic of 2008.  The arrangements let foreign central banks exchange their domestic currencies for US dollars in order to increase their domestic liquidity in addition to merely printing more domestic currency units.

The Wall Street Journal thinks the Fed should extend such swaps to more national entities than the few with which we still have such arrangements, under the guise of “that’s what the Fed’s role is.”

I have a couple thoughts on this.

…some folks to forget that financial panics happen, and that’s one reason the Federal Reserve exists.

No, it isn’t. The Fed exists to maintain price stability and full employment. Full stop.

Pricing instabilities might lead into financial panics, and vice versa, but if the Fed sticks to its role—working to maintain/restore price stability rather than reacting to panic itself—the panic will subside in result.

It [the Fed] could extend these swap lines to other countries with markets in tumult like Australia, South Korea, China, Taiwan, and Hong Kong.

It might—even likely would—be beneficial to extend swap lines to the Republic of China, along with most of the others named. It will do us little good at all to help out an enemy, the People’s Republic of China, for all that we’re presently (too much) entangled with the PRC’s economy. On the contrary, the drag the PRC’s economy represents on our own and those of other nations around the world illustrates clearly the utility of reducing that entanglement and increasing the flexibility of business’ supply chains.