LyrArc Article Gist
US president Biden campaigns in Nevada. His focus is on the cost of living actions and has proposed 15,000 affordable housing rental units on underused federal land repurposed for housing, action which can be taken on presidential orders. Other cost of living action is being prepared by Biden and he closely follows the mortgage rate increases from 3% to 8% that are leaving families stuck without owning an home. Biden is also focussing on the threats to democracy coming from the former president's rhetoric and actions, something that he devoted time to in his address in Philadelphia's Independence Hall, where the founders of this Union gathered together to draft the Constitution. This happened early in his first presidential term and in the 2020 campaign Biden focused on this threat to democracy. Peter Baker points out that Biden is best qualified to convey a sense of hope to America, yet what the NYT, W. Post and WSJ, and the television news channels -that are not watched as much by the core 25-54 years with a shift to digital- fail to do is to do their own introspection on how Biden has forged the consensus in Congress from his vast experience and wisdom to make the multi trillion dollar investments in America's future through infrastructure, job creation, manufacturing, chips and science. Not since FDR has America seen this happen and it shapes 2030. ...

LyrArc Article Gist
Some of the concern about the economy comes from the economic damage done by the coronavirus. The longer the shutdowns continue the more the damage. About 17 million have filed claims for unemployment benefits. The WSJ consensus of 57 economists is that 14.4 million jobs will be lost in coming months, and the unemployment rate will rise to a record 13% in June, from a 50 year low of 3.5% in February. The earliest the economy could go back to the level in February 2020 is 27 months says the WSJ economist survey. The brighter side of this comes in two aspects of this pandemic recovery curve. By flattening the curve and strict testing, contact tracing and isolation till the vaccine is developed about half the jobs lost can be recovered by the end of summer, says Moody's Analytics. The vaccine a year from now or in 9 months by November 2020 would allow the economy to recover faster. A more optimistic view comes from Daiwa Capital Markets which predicts many of people laid off will be recalled quickly allowing the labor market to recover in 6 months by September or October 2020. Only finance and real estate might take longer but most of the industries where the vast majority of jobs are could be back on their feet. The credible evidence supporting this perspective of a rebound comes from Colorado and Washington which require large employers to specify whether layoffs are temporary or permanent, 70% this year are temporary. Compare this to the prior 2009 recession where this figure was less than 1%- as reported by WSJ. The big push in this direction will be the $2 trillion that the Trump administration and U.S. Congress have committed to this task. Even more so is the determination of president Trump to protect American workers at all costs, that every job counts, and that businesses without exception to get the money have to show that workers are retained. The very success of the aid is being judged by how quickly people are back to work. Now for a look at where the situation is today- Oxford Economics, a UK based forecasting and consulting firm, projects 27.9 million jobs lost with industries other than those ordered to close making up 8 to 10 million of that number. It projects April's report will will capture late March layoffs. It will show cuts to 3.4 million business services workers, including lawyers, software groups, architects and consultants, advertising professionals, in addition to 1.5 million non-essential healthcare workers, 100,000 information workers. One conclusion of this report is that the virus does not discriminate across business groups and business service workers are also affected. Many companies that were hiring will cancel that move and many will cut hours worked. Many of these business services are not a priority. Hospitals are affected too, as they cut elective surgical procedures and routine care that are major revenue sources. Some are now charging for telemedicine visits to maintain some revenue stream. State and local governments employ 20 million workers. As tax receipts decline these local governments will face choices of cutting payrolls and services without enough federal government relief. In a way laying off workers and having them take unemployment benefits shifts that burden to the federal government so that services for overtime to police and paramedics, retention and deployment of nurses in schools.    ...

LyrArc Article Gist
Comments on X that cause difficulty for DJT chief of staff Susie Wiles to keep a clear narrative and the loss in the Wisconsin SC election are leading to a sense that Elon Musk could be a political liability. DJT focus is on the midterms and keeping the majority in the House, which is also why Elise Stefanik was asked to not accept the job of UN Representative and remain in the US Congress. The immediate focus is on tackling the Tariffs Liberation Day action April 2, 2025 so that followup negotiations with about 50 countries including major ones with Japan, Taiwan, Israel, Britain followed by European Union, South Korea and other nations. This would reassure markets as country after country is developing a new trade relationship that respects US manufacturing goals. China could then be tackled as a special case with America limited to loss of $146 billion in energy and grain sales which would be diverted to Europe's energy needs and farmers could be given a $50-100 billion support package. China would then have to find a way to preserve its $1 trillion surplus without the American market  which would require it to find other markets, and create a domestic market, if it chose not to negotiate and accept American manufacturing goals. ...

LyrArc Article Gist
John Lewis, is the last surviving speaker of the March on Washington in 1963, when Martin Luther King gave his historic speech. Here he describes how Martin Luther King would see today's America. Foremost he points out is that MLK would want to see justice not just as racial justice, but justice in a broader sense that says something about the dignity and value of human beings. And this means, says Lewis, the president getting away from advisers and polls, and talking to ordinary people. It means focussing on jobs, the unemployed and people facing foreclosure, and seniors struggling on limited incomes. He calls for a "freedom budget" that would pool resources for infrastructure and investments that would create a better environment for people to live in.

LyrArc Article Gist
"No amount of misrepresentation or statistical contortion can conceal or blur or smear that record. Neither the attacks of unscrupulous enemies nor the exaggerations of over-zealous friends will serve to mislead the American people." FDR said this  on October 31, 1936, it could also be president Biden.The current Media and Hollywood efforts to choose presidential candidates of their choice runs contrary to "We the People," contrary to views of ordinary Americans, of voters, workers and families. President Kennedy was told he should not take the nomination because he was too young. Kennedys' response was that it was he not Humphrey that went to state after state and won the votes in the primaries, no one else made the effort to run in the primaries in each state. President Biden has the support of 14 million in the primaries. George Chidi from Atlanta reports that undecided voters number about 1 million in the swing states and most are much older than the average. Most may feel insulted by talk about age when they are in the same category.  A 102 years old Lockheed engineer in Atlanta suburbs says he is a Republican but will not vote for Trump. There is also the women's vote in Georgia and Atlanta suburbs with abortion ban as the issue as it was in Kentucky and Kansas. How many vote will also be a factor, making energizing the base a key factor. The idea that one party is doing better than the other is refuted clearly by some of the people in Georgia shown here, and the age factor does not get the prominence the Media have given it, as long as the government is functioning well. Media has failed to look at the policy details of each candidate in a colossal failure that calls for alternatives. Older voters who are the major part of the 1 million or so voters in swing states that are undecided also say that the fact is that with both the candidates- as it is with administrations that are led by young presidents seen as too young to lead (JFK) the opposite of today- many of the decisions are made with an experienced group of advisers around the president. Many if not all also realize that the vast experience of an older president is also an asset. Much of Biden's legislation for chips science, infrastructure, the Inflation Reduction Act have not happened in Germany, France or the UK, and would not have happened in the US without the ability of president Biden to get the bipartisan support from being the one with the most experience in Congress in a long time. The result is the hundreds of thousands of jobs created each month and a growing economy, inflation down from 9 to 3% as the first step to further cost of living action to support ordinary workers and families. Only LBJ comes close and he signed landmark legislation for Medicare and Medicaid, and for civil rights into law 60 years back. By removing America from the wars that Reagan and Bush started and Obama and Trump failed to end president Biden has given the US an opportunity to inspire and lead the free world in a way that has not happened in many decades and build a growing economy, a bright future for the Nation. ...

LyrArc Article Gist
Kessler in the WP corrects Obama's claim that he created 800,000 jobs. He says this is clever arithmetic as it takes a low point in Feb. 2010 following the financial crisis. Kessler points out that according to the Bureau of Labor Statistics, U.S. manufacturing jobs were 12.56 million in Jan. 2009 when Obama became president. In Nov. 2016, early estimates show there were 12.26 million manufacturing jobs, a loss of 300,000. This loss does not reflect the problems in the U.S. auto industry and older industries in the midwestern states as a result of trade and globalization that speeded up with the rapid industrialization of China. And led as Greg Ip pointed out in a recent WSJ report to a rapid acceleration of job losses in a decade that did not happen in the same scale during Japan's industrialization and urbanization in the sixties. This aggravated the situation in Michigan, Ohio, Wisconsin, Indiana, and Pennsylvania, and was met with a feeble response from Democrats. Even a economist like Krugman favoring the Obama administration's efforts came to the conclusion that TPP did not add much to gains from trade as most of the gains had already been realized. More of the gains went to tech and IT in California, at the expense of the auto industry based in the midwest. A report in WP show a president too close to IT in California and failing to grasp the situation in the midwest. Voters punish whoever is in power, regardless of being Conservative or Liberal, in Canada the hollowing out of manufacturing under Harper in Ontario and Quebec led to the win by Trudeau's Liberals.  ...

LyrArc Article Gist
One of the quirks of the unemployment rate released by the Labor Department is that it is declining- declined to 8.1% from 8.2%, from March to April 2012- even though the number of unemployed may be increasing. When adjusted for the discouraged workers who would be working today in a more normal environment the unemployment rate today would be around 11%. Crucial in grasping unemployment numbers is the labor force participation rate- showing the number of working age Americans with jobs or looking for jobs- which is affected by the number of baby boomers retiring and leaving the work force, and by the number of workers who are too discouraged to look for work. The long term unemployed currently form about 40% of people unemployed in the U.S., which is quite high and cause for concern for Fed chairman Bernanke. Many of these long term unemployed it is feared will permanently drop out of the workforce, causing a drop in the productive potential of the economy and lowering economic growth. Already many have dropped out of the workforce, causing the labor force participation rate to decline faster than the gradual decline seen in the last decade as baby boomers retire. Between 2009 and 2012, a three year period, the labor force participation rate dropped about 2% to 63.6%, compared to the normal drop of 1.3% over a seven year period from 2000 to 2007. Combining the impact of the two trends, one demographic and the other a result of the 2008 global financial crisis and excessive risks in the U.S. banking system, leads analysts to to lower the longer term economic growth forecast for the U.S. to 2%, compared to the U.S. Fed's forecast for 2.3-2.6% growth....

LyrArc Article Gist
A Tax Policy Center study (joint project of the Brookings Institution and the Urban Insitute) shows $157 billion would be generated in the first year from an increase in taxes on the top 1% of income earners in the U.S., about 1.13 million households earning average $2.1 million, by increasing the federal tax rate from current 33.4% for this group to 40%. This could pay for a program to provide tution free education in America's colleges and universities. Even increasing the federal tax to 40% on the 115,000 households earning over $9.4 million on average, the top 0.1% of American households, would generate $55 billion in the first year, enough to pay for the $47 billion cost of tution free education at all of America's public colleges and universities, according to the Tax Policy Center. Economists including Stiglitz and others, point to significant impact of revenue generated from such a tax when applied to improving educational opportunity for the middle class and lower income groups. Education is a great leveler of income disparities as seen in the U.S. after World War II. During recent decades the highest income groups weren major beneficiaries of tax and economic policy, at the very time the middle class and factory workers were hit hard by global competition which lowered wages and exported jobs. The interest rate policies of the Fed after boom bust cycles also favored large investors in equity markets over smaller income earners with savings account deposits, whose savings experienced little growth under interest rates close to zero. ...

LyrArc Article Gist
Peter Goodman who covers the consequences in the lives of ordinary people of the industrial changes going on around us, gives this report from Michigan. He shows how today's Michigan, was home to Henry Ford's automobile plants that made it a major part of the industrial revolution in the US after 1910, when Ford's first assembly line manufacturing was set up in Highland Park, Detroit. Industrial growth till 1960 made the US the leading industrial nation in the world. Followed by Japanese imports and auto manufacturing shifting to Asia and Mexico, that led to deindustrialization and neglect in Michigan and the midwestern US.  Key aspects of resurgence today is coming from lessons learned in the period of deindustrialization. From labor and management not working together, from huge pension obligations and costs that had to be overcome, that made existing wage and cost structures uncompetitive with Asian manufacturing. Labor concessions in the last decade have made a rearrangement of cost structure possible, yet along with the financial crisis of 2008 further worsened worker incomes. The first steps of a return for Michigan to its role in the early industrialization of America, the new labor contract negotiated in 2023, the support of president Biden and the government, the investment in the new technology of electric car manufacturing by Ford, General Motors and Stellantis. Goodman shows how the state, federal government, community colleges and other educational institutions training workers and students, and car companies are working together to promote interests of workers and communities. There is uncertainty created about the fewer parts in the electric car manufacturing process, automation advances, and fewer jobs. Yet the process is a transition over many years and this is accepted by the Biden administration and by the industry as it responds to slower demand for electric cars in 2024. This provides the time to bring up new training programs for workers, enable the funding of new research into battery technologies that would bring down the cost and make electric car prices accessible to the wider population. Uncertainty and fears about the transition are counteracted by the effort the Biden administration is making to bring up all manufacturing and to make large investments in American manufacturing.   ...

LyrArc Article Gist
Upamanyu Hazarika gives this story of George Fernandes, a trade union leader in India in the post independence era. He played a role during the post Indira Gandhi Emergency period after 1977 and in the governments that were set up in the two decades that followed. Some of the political parties In India today trace their beginnings to that period. He was Defense Minister in the first term of Atal Bihari Vajpayee as prime minister. A new Penguin Random House biography looks at the life of Mr. Fernandes who comes from a Catholic family in Mangalore, Karnataka. and organized trade unions in Bombay state and in Bihar. Some of the shifts in Bombay from trade unions led by Mr. Fernandes to the Shiv Sena movement led by Bal Thackeray shifted attention to bringing jobs to the local Marathi speaking people in the commercial capital of the British period. Without the capital and technology needed and lacking the knowledge for development of industry on an American scale this kind of leadership failed to deliver on the aspirations of the people in the same way that Mao's experiments with the Great Leap Forward in India and Great Proleterian a Revolution failed to deliver in Beijing, Canton and Shanghai for China.  ...

LyrArc Article Gist
TSMC will build a third plant in Arizona with the $6.6 billion in grants it gets from Biden's CHIPS Act. It will increase its investment in the US from $40 billion to $65 billion, essential to make the US a manufacturing hub for semiconductors. Intel, Samsung and other companies are making similar investments in the US in semiconductor plants. After years of post Reagan/Friedman period orthodox economics that led to the US chip industry and other advanced manufacturing following textiles to Asia, the US is making its policies follow actual practice and experience. This experience shows that in semiconductors with long lead times of a decade to build plants the country which supports its semiconductor industry gets ahead while others following orthodox Reagan/Friedman period economics fall behind. This has revealed the danger of a theoretical economic textbook approach that doesn't work and endangers American manufacturing and technological leadership. A culture wrapped around the textbook approach has led to the US and the EU, India, losing their competitive advantages and losing manufacturing in industry after industry, with loss of millions of jobs and deindustrializing. It has also led to decline and increasing lack of economic opportunity in towns and communities dependent on this manufacturing across the US and the European Union. ...

LyrArc Article Gist
At Lyrarc we pointed out how US president Harry Truman had to persuade the US Congress to get aid to Greece and Turkey bills passed to prevent an imminent Communist takeover with Soviet bloc aid in 1948. Paul Krugman points out that this happened before when FDR had to persuade the US Congress to pass bills for Lend Lease agreement aid to Europe in 1942. Much of that aid was in food and other non military aid because the US arms manufacturing was beginning to ramp up.  Krugman also corrects the former president's statements regarding Ukraine aid that the European have done less. Counting all assistance to Ukraine he says the EU has done more than the US. It is because the arms production in the EU has to be ramped up and the US has arms production factories better prepared in military aid the US has done more in military aid, not overall or in other aid. He also points out that $13 billion FDR got from Congress for Europe in 1942 was 10% of US GDP, whereas Ukraine aid is only one fourth of one percent of US GDP, and much of it going as Mr. Biden pointed out, going into investment in American factories and jobs to supply Ukraine. ...

LyrArc Article Gist
The New York Times reports that comments from Obama administration officials describe an alarming loss of trust and confidence between China and the USA over the last two years. David Shambaugh, director of the China Policy program at George Washington University, says the administration had hoped to work with China on major challenges like climate change, nuclear nonproliferation, and a new global economic order. China, he says, has failed to step up and play that role. He describes the Chinese as responding as an increasingly narrow-minded, self-interested truculent, hyper-nationalist, and powerful country. Jeffrey Baker, a key China policy adviser in the White House, says China's responses reflected a sense in Beijing that China was a rising power and the USA a declining power, especially after the strong rebound of the Chinese economy after the 2008 crisis. The administration is determined to counteract that impression. Other factors complicate things. China is facing a transition to a new leadership in the next year. There are differences within the Chinese Communist party leadership ranks about the direction China should take. Trade and currency issues have come to the point where American public opinion is shifting greatly, with educated professionals changing their views on trade and currency matters. See the recent WSJ/NBC September 2010 poll on world trade, reported by Murray and Belkin in WSJ, Oct 2, 2010. The Obama administration cannot ignore the deep concerns of the American people on these issues. The House overwhelmingly voted in September to threaten China with tariffs on its exports if the Chinese currency, the renminbi, is not allowed to appreciate significantly enough (experts estimate that it is overvalued by 20%). It is not clear whether the Administration's rhetoric on this issue is to assuage public opinion in a business as usual manner, or expected to achieve substantative results to rebalance world trade. The G-20 summit in S. Korea leaves this change for well into the future- China with current account surplus of 5.8% of GDP in 2009 is expected to lower this to 4% by 2015. With the high jobless rate in the US and the large and rising current account deficit, the United States may have reached a juncture where this cannot be put off well into the future years. Other issues, the different foreign policy objectives, and differing perceptions of China and the US of each other, the relationship with US allies in the region, may create additional tensions. These tensions may be navigated by governments of both countries, but the shift in American public opinion on trade, currency and jobs issues will require tangible and real change. As trade tensions will only increase in the next two years with the lack of fiscal stimulus on the jobs front, and no significant change in jobs expected from the Fed's purchase af additional Treasury debt, and a sense that the mutual benefit in the trade relationship with China has been lost to America's serious detriment. China's position may be perceived as stronger than it really is from the faster rebound from the 2008 crisis, and may in reality not be as Jeffrey Baker sees it. As David Barboza has reported in the New York Times, and experts have pointed out, the huge amount of lending encouraged by the government has accentuated weaknesses in the Chinese economy. A significant amount has gone into real estate speculation and will only increase the bad loans on the books of China's banks. This happens at the very time that growth is expected to slow down and make it harder to absorb the bad loans, as was done in the past. ...

LyrArc Article Gist
New Commerce Secretary, Gary Locke, has contacts with the Chinese leadership, and has years of experience on China trade issues. He was Governor of Washington state, which has about a third of its jobs dependent on foreign trade and looks west to the Asia Pacific region for growth. He is the country's only Chinese-American governor, as governor of Washington state from 1997 to 2005.

LyrArc Article Gist
How seriously are the Border Crossing encounters with migrants being taken by the Biden administration compared to the Trump administration, or earlier administrations Republican and Democrats. Pew Research Center provides these 7 charts and other data. In 2021 border crossing encounters with migrants were shown as 1.6 million. Of this 27% were repeat crossings a number much lower in previous years. It had fallen to just 400,000 in 2020 as the policy of expulsion put in place by the Trump administration was continued by the Biden administration. In 2019 the border crossing encounters with migrants after three years of the Border Wall construction under president Trump were 851,000. The Biden adminstration in 2021 had 52% expulsions compared to Trump administration 66% in April 2020 after invoking public health Title 42 which Biden continued. About 33% said the Trump administration was doing a good or somewhat good job in 2019 compared to 29% for Biden in 2021. But a much lower percentage of Republicans were saying Trump was doing a bad job than the 56% of Democrats saying that for Biden today. The previous surge in 2021 was mainly from Guatemala and Central America. The current surge is from about 400,000 migrants from Venezuela where expulsion does not work as well because the US has cut off relations with the government of Mr. Maduro in Venezuela, There are 7.1 million refugees from that country in Latin America. The Trump administration would have faced similar problems with the Venezuelan surge that the Biden administration is facing. The largest jump in 2021 is in Yuma Arizona 12 fold, two fold in Tucson and San Diego, three fold in El Paso, the Del Rio and Rio Grande up 5 times.    ...

LyrArc Article Gist
There are 2.3 million federal workers outside of the US Post Office and military. WSJ analysis shows more than half of the Congressional Districts with the largest proportion of federal workers are Republican districts. How do you get these Republicans to sign off for layoffs in their own states and districts asks the WSJ. DOGE faces a tough fight on this. The other issues are about getting the work of government done where the layoffs to cut costs are done in a way that reduces the productivity of workers with conflicting goals and instructions so that important work doesn't get done. US Treasury's Fiscal Data Site shows the US federal government spent $6.9 trillion in 2024 or 23% of the US GDP. The Government Accountability Office last year issued a report that fraud, waste losses were about $521 billion, this is about 8 percent of the US federal spending in 2024. To get this done, to cut waste and fraud requires a patient effort which also does a job of convincing the people of America that the cost cutters are doing a good job, cutting fat not bone or muscle. DOGE led by Musk require much patient effort - loud, high profile actions could hurt with distractions.  It is different on runaway illegal migration and 490,000 deaths from fentanyl over 12 years, where action cannot be loud enough to get America's voice heard and action taken to prevent any more deaths. Biden and Democrats signed up in 2024 to Republican Senator Lankford's bill, so that it means both Republicans and  Democrats now have to deliver on this.   ...

LyrArc Article Gist
As Japanese sales in the USA drop from 4.35 million vehicles in 2007 to 4 million in 2008 and an estimated 3.67 million in 2009 according to CSM Worldwide, even the Prius and the Honda Civic are afected. The Mississipi Blue Springs plant originally designed for the Higlander SUV , then assigned the task of making Prius after the shift to smaller cars, now will not make the Prius. The plant investment will stop at $300 million, with the plant construction being completed but the equipment not being installed, and no plans to manufacture cars there till things improve and the plant is made fully operational. At the same time it is noteworthy that employees Toyota has hired at the plant will keep their jobs. Toyota has not laid off permanent staffers at its plants in North America or any other region despite slowing sales in its worldwide markets. What does this mean? The culture of the United Autoworkers Union developed through the prewar confrontations between the union and the auto companies, and union workers and union officials and company managers came to a consensus through these struggles with the coexistence of high executive compensation and union medical benefits and other benefits and job security. But its not really been a frutiful arrangement as it has constantly been whittled away and eroded to the point of going out of existence even as the union clung on to the old ideas and management just went on with the status quo. Jobs security is nonexistent and jobs constantly cut as plants close, and now high executive compensation will face government oversight with the auto loans. See the link to Business Week which states that the numbers show the auto workersin Detroit union plants pay about 5% of their medical costs as opposed to 30% for workers who have healtcare coverage in the USA. But what good is the additional benefit in an environment where plants are constantly closing and jobs being cut. Is'nt aworker at a Toyota plant with no job cuts but costlier medical benefits better off than his Detroit counterpart? Which is to say with forward looking management that lowered executive compensation and unions that discarded an entitlement attitude and proactively matched its medical benefits to levels to nonuninized Japanese plants, and management that proactively shifted to higher fuel efficency and smaller cars in the interest of energy conservation and good strategy to be level with companes like Honda ad Toyota in that performance measure, wouldn't that have led to fewer plant closures and jobs, and public support across the country including in dealer showrooms?...

LyrArc Article Gist
How temp services companies such as Kelly Girl and Manpower were started in the post war period. What this means in today's economy with the increase in temp and part-time workers without worker protections and benefits. The trend to temp workers without contracts or protection is seen in Germany, Spain, Japan and other countries. Hatton cites Census Bureau statistics showing one third of adults experiencing poverty are working, one fourth of jobs in America pay less than the federal poverty line of $23,050. In the U.S., Europe and Japan it is not only the jobs that matter but the kind of jobs. Even in countries such as Germany that reduced the unemployment rate this came with a downside in the higher number of lower paying jobs. Temporary workers almost doubled in two decades in Japan to 33% of workers by 2007. Some of the difficult work after the nuclear accident in Japan was performed by temporary workers.

LyrArc Article Gist
Where did the numbers in the US president DJT's charts come from wjen shown in the Rose Garden on Liberation Day April 2 2025? The number for example 68% for China comes from a ratio- deficit by country divided by total imports to US.  The numerator reflects the US concern about trade deficits. It is exports minus imports for China in this instance. In 2024 China's exports were $438 billion to the US. It's imports were $143 billion. The difference is the surplus or deficit China has with the US. China's surplus is $295 billion. China's surplus is also America's deficit with China when turned around and seen from the viewpoint of America. The denominator reflects the US concern about how much it is importing from each country- this is how much it is not making inside America and which it has to get from another country. The more that it imports from another country the less it makes at home. If labor in the US gets too costly and is not cooperative to make well designed reliable products more factories close and are build outside in another country. This has consequences- serious consequences over time as it spreads to different industries. FOr the first time in history. A foreign nation makes practically everything and US acts only as a consuming nation- this means the workers jobs and incomes in the US are destroyed. It is often a sign of serious decline in the Nation. $295 billion/$438 billion is 67%. This is the China number shown on DJT's chart in the Rose Garden. The tariff and non tariff barriers and currency manipulation that China conducts in trade with US is measured in this way as an estimate, much higher than actual tariffs which is why US products don't get the treatment they deserve in China's market.   ...

LyrArc Article Gist
The US needs good manufacturing jobs for the jobs and income that it brings into communities, and also because of the tax revenues from the companies making products in America that provide the basis for local governments to provide good public services in healthcare, education, and transportation. To say comparitive advantage that helped first Japanese and now Chinese manufacturers is real and how society gains is to deny some basic facts that are self evident from observation that contradict textbook ideas in economics. Comparitive Advantage is a textbook economics concept that says countries are proficient in what they make best and should specialize in that product. But it is a static concept that exists only in textbooks. If Japan in 1960, China in 1980 and India in 2000 were each presented with this idea they would have turned down the idea of making steel and remained makers of lower end products such as footwear and textiles. If Japan in 1980, China in 2000, and India in 2020 were each presented with this idea they would have turned down the idea of making semiconductors and remained makers of lower end products such as steel. A senior vice president of US Steel in the late 1960's even told this writer a graduate student at Northwestern in Chicago- as the US can make steel better than India or China let us keep making it for you. He and much of the business faculty at Northwestern also could not understand in 1970 why Airbus was being setup to compete with Boeing who by the concept of comparitive advantage should have had the whole market to itself for commercial aircraft . By this kind of thinking Airbus would not exist today because it did not have the lowest cost or the manufacturing technologies Boeing had through its vast manufacturing operation. America would be still the only one making aircraft in 2023 if textbook concepts ruled the day. By indirect methods such as hidden preferential arrangements, provision of inputs such as land, capital and labor, tax relief, the costs can be represented in a way that shows it is cheaper to manufacture overseas. The lack of a level playing field is what president Biden is correcting by doing what first Japan, then South Korea, then China and now India are doing since the 1960's. By 1974 in four years after its founding in 1970 Airbus came up with its first model the A-300 using advanced technologies. America will regain its leadership in the cost and manufacturing of many products through Biden policy and the efforts of American companies by 2030, and do this in a transformative way that will benefit the world as a whole.  It is an enormous error to say the US does not need good manufacturing jobs, that local governments do not need the tax revenues from manufacturing plants to build services for communities where manufacturing workers live, and the US does not need the manufacturing experience curve that leads to reduced costs. It is this loss of the manufacturing experience curve that is the most vital aspect for understanding the need for the US government to compete effectively with the governments of Asian countries to keep manufacturing healthy and strong at home. Economics experts ignorant of how important this science and engineering principle is fail to grasp this. Related to this is the idea of a virtuous cycle in manufacturing- whoever braves the hard years of moving up the learning and experience curve gets rewarded because once that country has mastered that skill it gets better an better as the technology advances- making it harder and harder to prevent a new monopoly in manufacturing by the country (Japan, China or Taiwan) that had the highest costs and the least advantage ten or 20 years earlier but just persevered through it all with the government's help to gain cost competitiveness. This part does not make it into the economics textbooks which are mostly theory and much of it outdated by the time they are written. Observation is the best teacher and guide as it is in science, to guide policy and action. Obsessive attachment to theory that ignores observation becomes the enemy of progress. Comparitive advantage is one concept that needs to be retired even from the textbooks. Overseas manufacturing then is a piece of the overall picture that fits into what is good for the US. Macroeconomic principles determine microeconomic outcomes as opposed to microeconomic principles with companies out on their own being forced to compete without a level playing field, or handing out technology for special status in a recipient country as some do putting the US at a macroeconomic disadvantage. This is also healthy for the recipient country overseas, as recrimination with loss of manufacturing jobs in the US inevitably leads to the kind of recrimination that does not serve either country well as in the case of China today, and worse still can lead to conflict, even war. After the egregious situation of loss of manufacturing communities across the US leading to destabilizing the social fabric, it is hard to see such thinking prevail about the US not needing manufacturing as a vital part of its social fabric and industrial strength. China, it can be said, would have developed, and developed well over the past two decades without overconcentration of US and EU manufacturing in China. Without aggravating the problems of climate change and contamination of air, land and water, and destabilizing the social fabric in the US hurting workers and communities across the US, if macroeconomic policy was made to manage this process in the US government without it being left entirely to individual companies to decide. Instead China faces today a difficult situation through events such as destabilizing the social fabric in the US (the Trump tariffs), advanced economies in G-7 resistance to sharing of technologies, the damage to its environment from microeconomic locally determined policy at individual companies, and the global effects of climate change from climate unsustainable levels of growth since 2000.  ...

LyrArc Article Gist
The Journal's Jeff Bennett talks with Rodney O'Neal, the CEO of Delphi Automotive. O'Neal says Delphi's success depends on focussing on advanced technologies where emerging market producers are less able to compete. He has focussed on 33 product lines which are 'green,' safe' and connected.' If it doen't create value then revenue and cost numbers are wrong, is O'Neal's lesson from the bankruptcy filing. He likes the chaotic discussion coming form strong debate, where views are expressed with passion and counterpoints made, and he takes this debate seriously, because as he sees it choosing the right course is a significant task in itself, which takes much time to correct if wrong. There are major improvements in emission and fuel economy ahead and a high tech future for the automobile industry. He see America's future in high-tech where America can do better than emerging market producers, and ensuring that the steady flow of exceptional American talent continues to be channelled properly....

LyrArc Article Gist
A critical point mentioned is that for a heavy polluter like China, the slowdown means less production of heavy industry like cement and steel that produces few jobs and has large emissions. The slowdown is an opportunity to make a transition to a greener economy that creates more jobs. The spokesperson for the European Commission says it depends on the vision and foresight of European, American and Chinese leadership whether they use the transition as a short term bitter apple to create new sectors that help in conservation, the environment, and for jobs, all at the same time. Government incentives and mandates, education, and leadership may be critical to doing this. Business and the private sector and markets can be shortsighted in this respect, and lack the will and staying power to see it through, leading to suboptimal results at best or destructive results as critical time is lost in indecision or inaction.

LyrArc Article Gist
This report in WSJ shows that remote work is a lasting trend because companies can now hire talented individuals from anywhere in the country or the world, and pay less for the same talent. In the past talented individuals were attracted with high pay packages to cities such as San Francisco, Seattle, New York, Boston and Los Angeles. Companies can now choose to avoid paying these high pay packages and have a broader talent pool to choose from. This is because these cities became costlier and less attractive with cramped apartments relative to the choices for remote work. In the example cited here a machine learning expert shifted from a small cramped apartment in San Francisco to work for Twitter from a small town named Katy in Texas where she has a 5 bedroom large apartment and a nicer community of 20,000 people to live in west of Houston. One in 8 jobs posted on Linked In as of August 2021 are for remote work, many times the percentage of remote work job postings in 2020, showing this trend is here to stay. There is a large shift of millions of workers in tech related fields exiting the cities of San Francisco, New York, Seattle, and Boston for smaller cities in other parts of the country such as Utah, Texas and other states in the US. A similar trend is observed in Europe. America's professional classes are moving to hybrid or remote work in large numbers says this report in WSJ. At one point in 2020 about 35% of workers in the US or 50 million workers were doing remote work during the lockdowns. In August 2021 this figure is closer to about half of these workers even as workers return to work offices. It is believed that the BLS statistics understate the number of remote workers at 20 million and 14% of workers in August 2021. Large crowded and hugely expensive cities are no longer attractive for employers or for tech employees or professional workers. ...

LyrArc Article Gist
Was president Biden right to get the Fed, the FDIC and Treasury to cover the uninsured deposits in Silicon Valley Bank. Is it a good use of taxpayer money? $25 billion was provided by the Treasury to the Fed to stabilize other medium sized banks. The answer from the administration is that it was necessary to protect working families from any effects on the overall economy of the ripple effect on medium sized banks that were left unregulated by former president Trump's 2018 roll back of regulation on banks with less than 250 billion in assets.The Office of the Budget has shown that the government recovered all except $31 billion from the much larger bailout of 2008. Paul Krugman in NYT says the assets of SVB are invested in long term US Treasury securities which have value and should cover most of the cost of insuring depositors. Moral hazard is covered by the management at SVB and Signature losing their jobs and by the losses in stock value and bonds which are left unprotected as a cautionary signal to investors. A much larger impact is hidden in the hearts and minds of Silicon Valley who will be expected to reflect on the nature of their self serving deal where they oppose regulation of tech monopolies and of regulatory action except where it serves their  own interests, and see a laissez faire system that works for them but not for workers and families across communities in states across America. A situation made worse by the loss of America's manufacturing base on which issue Silicon Valley neither reflected or acted. ...

LyrArc Article Gist
About 4.2 million Americans will be 65 years old in 2024, and for the next six years about 4 million will be added to the 65 plus population each year making the 2030 population of 65 plus larger by about 24 million people. As America ages it will need more young people to do many jobs in healthcare, care for the elderly, in agriculture and transport. This is what we are seeing in Japan and even a country highly protective of its own culture has a policy of admitting immigrants from Vietnam and other countries to meet worker shortages. Claire Ansberry looks at the 65 plus population today and compares it to 35 years ago and finds it is more oriented to exercise, health, and has more accumulated wealth. About 20% of people over 65 years work today compared to 15% 35 years ago, says Pew Research, and of these working 65 year olds two thirds are working full time compared to half in 1987. They are wealthier having median net worth of $410,000 today compared to $282,000 in 2010 much of the 45% gain made in the last 2 years from rising house prices and stock investments. Those over 75 years have a 13% gain. Overall the wealth is significantly higher today. ...