Tag Archives: politics

Deflationary Pressure in the PRC

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A quick note. As The Wall Street Journal writes, the People’s Republic of China is facing the threat of economic deflation.

Prices charged by Chinese factories that make products ranging from steel to cement to chemicals have been falling for months. Consumer prices, meanwhile, have gone flat, with prices for certain goods—including sugar, eggs, clothes, and household appliances—now falling on a month-over-month basis amid weak demand.

There are a number of causes for the nation’s falling prices, including to some extent, the deflationary pressures being relative to the inflation spike that the PRC experienced as the world came out of the economic dislocation the Wuhan Virus Situation engendered.

However, there’s another factor—a critical one IMNSHO—that pushes for deflation in the PRC. That factor is the nation’s shrinking population. With fewer people even available to buy things, demand necessarily must fall, and if the supply of goods and services doesn’t fall commensurately, prices will come down. If those prices already are flat, or falling, then they’ll only fall further. With that lessened demand, the only way producers can stay in business is to reduce production—to reduce payroll costs, either by reducing pay, laying off workers, or some combination of the two. That reduced income will drive further reductions in demand.

Deflation sets in, and it deepens.

The Quiet Part…

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…out loud, to coin a hackneyed, but cogent, phrase.

On the matter of Federal government industrial farm policy, the Biden administration has made itself crystalline. This is the backdrop:

In January 1994, the North American Free Trade Agreement went into effect, followed by other trade pacts, which significantly increased commercial opportunities for American farmers. Those arrangements have borne great fruit: US agriculture exports stood at $196 billion in 2022, up from $62.8 billion in 1997.

President Joe Biden’s (D) National Security Advisor, Jake Sullivan, doesn’t like that, but in a recent speech, Sullivan went even more broad than just NAFTA, to openly disparage the general policy environment surrounding the development of that treaty. Sullivan lamented that this era of policy was one that

championed tax cutting and deregulation, privatization over public action, and trade liberalization as an end in itself.

Because leaving more money in the hands of us ordinary citizens by taking less of it as taxes, by reducing our cost of doing business by getting regulations out of our way, is inherently bad, says this maven of the Progressive-Democratic Party. Even more: public action must take precedence over private action—because, apparently, Government Knows Better than us ignorant ordinary citizens. And trade liberalization, which further reduces our costs, is a bad end in itself.

This demand that Government must control what our private enterprises produce is a well-understood and textbook…ideology…regarding the importance of government control over our lives. And it’s a central plank of the Progressive-Democratic Party platform.

A Start

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But it’s a move that could—and should—be made irrelevant by a larger move.

Senators Marco Rubio (R, FL) and Kevin Cramer (R, ND) have reintroduced their Protect Equality and Civics Education (PEACE) Act, which is intended to eliminate the ability of the Department of Education to commit tax dollars to any plan or program to push Critical Race Theory into our schools.

That’s fine as far as it goes, but there’s a larger solution that more broadly addresses this mess.

The US Department of Education needs to be eliminated altogether—not merely defunded, but erased from the Federal government. This is a Cabinet entity that our nation did without just fine for nearly 200 years. It was created out of whole cloth just 43 years ago in 1979, and over the last several years, all it’s done has been to interfere with our children’s education by moving teaching away from serious subjects and into inherently racist and sexist ideological indoctrination. Additionally, DoEd has become a facility that seeks to deny due process to students accused of sexual misbehaviors. DoEd’s usefulness has disappeared.

Moreover, DoEd’s FY2024 budget request of $90 billion is money much better allocated to other purposes: items like plussing up our defense establishment with equipment, logistics, and combat training, as well as our defensive and offensive cyberwar capabilities; strengthening our government and private cyber security capabilities outside of our defense establishment; strengthening our energy and water distribution networks; supporting relocation of our economic supply chain sources and intermediate stops away from enemy nations. The personnel of the department should be transferred completely out of Federal government employ into the private sector, where their existing experience will easily facilitate their finding gainful employment.

Inadequate Electricity Infrastructure

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There is a move afoot, spearheaded by a number of car companies, to expand the number of battery car charging stations in the US. iSeeCars.com says that planned expansion is inadequate. The company’s Executive Analyst Karl Brauer:

[E]ach of these fast chargers can cost $50,000 or more to install, and this joint effort claims it will utilize 100 percent renewable energy to power the new chargers, which can only mean higher costs for each unit[.]

And that’s just for a few midwestern States.

Bauer is right about the infrastructure’s inadequacy, but the shortfall is much deeper than just battery cars’ electricity demands.

Our electrical infrastructure is inadequate because it’s built on antiquated wiring/cabling, too few and too restricted fossil fuel-powered generating stations; too few generating stations of any sort; lack of spares, particularly transformers and transformer parts and fluids; poor-to-nonexistent (still!) cybersecurity; and on and on.

Those shortfalls need to be filled regardless of the number of battery cars and trucks are on the road.

Misplaced Push

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Too many Republican Senators are joining their Senate Progressive-Democrat colleagues in pushing Senator Tommy Tuberville (R, AL) to drop his blocking of President Joe Biden’s (D) military appointments and flag officer promotions.

Tuberville is holding up—not blocking—final confirmation votes on those appointments and promotion lists over SecDef’s insistence on using taxpayer funds to pay for abortion and abortion-related services used by military members and/or families.

Tuberville isn’t holding up anything; he’s merely blocking blanket moves to use unanimous consent for approval. Senate Majority Leader Chuck Schumer (D, NY) and Senate Minority Leader Mitch McConnell (R, KY) readily enough could bring each of those appointments and promotion lists to the Senate floor for votes, but they refuse. Apparently, they want, instead, the spectacle of the holdup.

That’s a minor point, though. The larger point is SecDef Lloyd Austin’s stubbornness in demanding that those tax dollars be used for abortion services, Hyde Amendment be damned, on the legal front, and he just doesn’t care about those babies’ lives on the moral front.

If Austin wants his promotion lists, and if Biden wants his appointments, all they need do is remove their demand to spend our money on abortion services and on abortion.

It’s that straightforward.