Interesting & Important News & Analysis, September 14, 2019

So, New Faces PAC (a GOP PAC) ran an ad during the Democratic debate in which they say, “Does Alexandria Ocasio-Cortez know the horrors of socialism? Forced obedience, starvation.”

Fortunately, Yahoo News’s Senior Staff members, Dylan Stableford and Christopher Wilson, knew how to clarify things for those behind the ad. They wrote, “The Khmer Rouge ideology was communist, or more precisely Stalinist, far removed from the brand of democratic socialism espoused by Ocasio-Cortez.”

Are rank and file GOP members really ignorant enough to conflate Stalinism with democratic socialism?

I don’t agree with everything Alexandria Ocasio-Cortez, but she’s no Stalinist or budding Khmer-Rouge-like ideologue.

Really, such juvenile attacks need to end. Let’s all try harder to be honest and intelligent while we decide the fate of the world (and perhaps beyond) and humanity.

2020 Vision: A burning AOC offers a scary preview of next year’s attack ads

“Make Earth cool again.”

‘If you did your job, we’d be in school’: Greta Thunberg joins White House climate protest

Woman took the homeless to dinner at Taco Bell. They got tossed out instead

For thousands of years, people have heard the right thing to do but still stand in the way.

Luke 14:12-14 ESV:

He said also to the man who had invited him, “When you give a dinner or a banquet, do not invite your friends or your brothers or your relatives or rich neighbors, lest they also invite you in return and you be repaid. But when you give a feast, invite the poor, the crippled, the lame, the blind, and you will be blessed, because they cannot repay you. ….”

“… Biden is held to a standard President Donald Trump is not.” They’re running for different parties. Why should the Democratic Party put up with what the Republican Party puts up with? I’m not saying Biden and Trump are equally right or wrong. That’s not the issue. The issue for the Democratic Party is who would make the best President of those running. If energy is the requirement, Elizabeth Warren is the energizer bunny of the field regardless of age.

Look, my personal view is that the criteria for choosing a President is way off and has been for decades. A President doesn’t need to be what it takes to be a preforming seal in what passes these days as a “debate.” A President needs to be able to be methodical when weighing things. In many cases, that’s shouldn’t be rushed. A President must be decisive but also visionary. A President shouldn’t be dimwitted or “slow,” but the current vetting process is a disaster when it comes to choosing the best person for the job, for the responsibility. Does Joe Biden meet all of that? Do any of the candidates?

U.S. investors target Europe multifamily amid fierce competition at home

Not all European markets operate under the same rental market legislation, making multiple market purchases trickier. Coupled with political risk, that could give North American investors “pause for thought” in some European markets, says Espenshade.

“Brexit and new rental legislation in Germany are potential headwinds, but other European markets are comparatively stable in that respect.”

Will the IMF Finally Learn From Argentina?

It is now clear that fiscal austerity and a floating exchange rate are inadequate to cope with capital-flow volatility. The only question is what should come next, not just for Argentina, where the IMF will struggle to salvage its loan program, but for the Fund itself.

For starters, the IMF must devise better ways of resolving unsustainable sovereign debt burdens. Unsustainable domestic debt can always be resolved through rescheduling or bankruptcy. But international debt is another matter, and here the IMF’s record leaves much to be desired. In the 1998 Asian crisis, the Fund strongly resisted rescheduling. In the 2010 Greek crisis, it allowed creditors (mainly foreign banks) to protect themselves from their own foolishness. And in Argentina’s case, it refused to use its clout to override vulture bondholders who had subverted the 2010 rescheduling, even as it rolled out a massive loan program.

Second, the IMF should face up to the fact that unconstrained international capital flows are too volatile for fragile emerging economies. Having long opposed capital controls, it has belatedly – and unenthusiastically – endorsed “capital flow management,” but only as a last resort when all other measures (namely, painful austerity) have been exhausted.

Renewed Crisis in Argentina Puts IMF Under Fire

While the markets reacted poorly to Fernadez’s electoral success, Weisbrot does not see cause for alarm. In an August op-ed for The New York Times, he notes that under prior left-wing governments, poverty declined dramatically GDP per person significantly [increased] as the state implemented social programs that improved the lives of ordinary Argentinians.

“By comparison, poverty has increased significantly, income per person has fallen, and unemployment has increased during Mr. Macri’s term,” he said.

This is why fiscal stimulus is the best thing to do.

Kalecki, Minsky, and “Old Keynesianism” Vs. “New Keynesianism” on the Effect of Monetary Policy

Changes in interest rates similarly affect housing and consumer durables spending. As long as that channel works well, monetary policy can influence the economy, stopping an upswing or turning a downswing around after a time.

As Minsky pointed out, over time household debt can pile up as raising rates to slow down an inflationary economy won’t likely restrict the growth of debt enough to offset its growth when rates are lowered to stimulate borrowing to spend on housing and consumer durables (Mott, 2002). Then we will reach a time like 2007, when lowering rates won’t be able to accomplish enough because of too much outstanding debt.

ECB announces fresh stimulus as eurozone economy falters

After years of support from the central bank to sustain growth in the decade since the financial crisis, he [Mario Draghi] said: “Now it’s high time I think for the fiscal policy to take charge. In view of the weakening economic outlook and the continued prominence of downside risks, governments with fiscal space should act in an effective and timely manner.”

A Requiem for the Fiscal Theory of the Price Level

The way that people form beliefs must be modeled as a new fundamental with the same methodological status as preferences, technologies and endowments.

Our paper makes a mockery of the attempt to ground neoclassical theory in ‘fundamentals’.

Trump team rushes to find escape hatch for China tariffs

“The idea is to pull the relationship away from where the president loses his temper and could really hurt them,” said the person, who was recently briefed by Chinese officials.

A way for Trump to avoid a huge political hit if the Fed won’t do the right thing and the Congress won’t either would be for him to ask super-rich Americans to pony up. That would play well with the working masses on both the right and the left. We are in an economic war with Xi of China. What’s the patriotic thing the super-rich in America should do? Are they even thinking down the road?

Should US households be more worried about higher consumer-product prices for awhile or losing jobs and more jobs and more jobs? Who’s responsible for selling the Trump tariffs to the American people? Where’s the marketing?

The China toll deepens: Growth in the bilateral trade deficit …. millions of U.S. jobs, with losses in every state and congressional district

The United States has a massive trade deficit with China. The growth of the U.S. trade deficit with China, which has increased by more than $100 billion since the beginning of the Great Recession, almost entirely explains why manufacturing employment has not fully recovered along with the rest of the economy. And the growing trade deficit with China isn’t just a post-recession phenomenon hitting manufacturing: it has cost the U.S. millions of jobs throughout the economy since China entered the World Trade Organization (WTO) in 2001, a finding validated by numerous studies.

This report underscores the ongoing trade and jobs crisis by updating EPI’s research series on the jobs impact of the U.S.–China trade deficit. The most recent of these reports (Scott 2012; Kimball and Scott 2014; Scott 2017a) look at the effect of the U.S. trade deficit with China since China entered the WTO in 2001. Our model examines the job impacts of trade by subtracting the job opportunities lost to imports from those gained through exports. As with our previous analyses, we find that because imports from China have soared while exports to China have increased much less, the United States is both losing jobs in manufacturing (in electronics and high tech, apparel, textiles, and a range of heavier durable goods industries) and missing opportunities to add jobs in manufacturing (in exporting industries such as transportation equipment, agricultural products, computer and electronic parts, chemicals, machinery, and food and beverages).

The growing trade deficit with China since China entered the WTO affects different regions in different ways. Some regions are devastated by layoffs and factory closings while others are surviving but not growing the way they could be if new factories were opening and existing plants were hiring more workers. This slowdown in manufacturing job generation is also contributing to stagnating wages of typical workers and widening inequality.

Sen. Wyden’s Anti-Deferral Accounting Proposal Could Be a Game-Changer

For non-tradable assets, Wyden’s paper proposes a lookback rule that would continue allowing taxpayers to defer income tax on gains until selling the asset but would then increase the income tax due in a way that diminishes the benefit of the tax deferral.

I was wondering where the liquidity would come from. Not everyone can come up with the liquid funds to pay taxes on unsold assets.

Unsheltered And Uncounted: Rural America’s Hidden Homeless

… the number of public school students identified as homeless is rising. The majority of these children, 88%, live in cities, suburbs, and towns. In recent years, however, the highest rate of growth for student homelessness has been in rural America. Between the 2013–14 and the 2016–17 school years, the number of homeless students in rural areas increased by 11% to over 162,000 students.

… disease, such as the Hepatitis A outbreak which has claimed 58 lives in Kentucky so far and sickened approximately 5,000 people, many of them homeless.

… plenty of folks, like Bowers, just can’t make themselves come in from living in the woods or on the streets because of anxiety, PTSD, addiction, or symptoms of mental illness that makes it difficult to be around people, what she calls “general orneriness.”

Los Angeles OKs a deal for record-cheap solar power and battery storage

Under the 25-year deal with developer 8minute Solar Energy, the city would buy electricity from a sprawling complex of solar panels and lithium-ion batteries in the Mojave Desert of eastern Kern County, about two hours north of Los Angeles.

… California could invest in offshore wind turbines, which generate electricity more consistently than onshore turbines, or import more renewables from other states, where the sun shines and the wind blows at different times of day.

There are also several technologies that could eventually provide long-duration energy storage, including hydrogen, compressed air and flow batteries.

Developer sues NYC again over East Village school redevelopment

… Singer argues that his woes stem from the city’s desire to reclaim the building and “correct a supposedly historical mistake” when the Giuliani administration auctioned it off to him for $3.15 million in 1998, according to the Manhattan Supreme Court lawsuit.

This young lady is a true hero.

Greta Thunberg on the Climate Fight: “If We Can Save the Banks, Then We Can Save the World”

Greta Thunberg is one of the great truth-tellers of this or any time. But Greta is not all talk. All of this began with action. It began when Greta realized that if she wanted powerful politicians to put themselves on emergency footing to fight climate change, then she needed to reflect that state of emergency in her own life. And so she stopped doing the one thing all kids are supposed to do when everything is normal: Go to school to prepare for their future as adults.

Instead, she stationed herself outside of Sweden’s parliament with a handmade sign that said simply: “School Strike for the Climate.” She started doing it every Friday, and pretty soon she attracted a small crowd. Then other students started doing it in other cities as well.

Students like Alexandria Villaseñor, who stations herself outside the United Nations in this city every Friday, week after week, rain, snow or shine. Sometimes the student climate strikes were just one lonely kid. Sometimes tens of thousands showed up.

And then, on March 15, came the first Global School Strike for Climate. Over 2,000 strikes in 125 countries, with 1.6 million young people participating on a single day. 1.6 million people. That’s quite an achievement for a movement that began just eight months earlier with a single 15-year-old girl in Stockholm, Sweden.

And now this movement is gearing up for its biggest challenge yet: They have called on people of all ages to join the and go on strike, all around the world, on September 20. Because protecting the future is not a spectator sport.

Thunberg and the many other amazing young organizers have been very clear that they do not want adults to pat them on the head and thank them for the hope infusion. They want us to join them and fight for the future alongside them. Because it is their right. And all of our duty.

“Idlib province is largest Al Qaeda haven since 9/11” – Brett McGurk July 2017

“In Idlib province, look, Idlib province is the largest Al Qaeda safe haven since 9/11 tied directly to Ayman Al Zawahiri. This is a huge problem. Its been a problem for some time. We have shone the spotlight, the international spotlight on ISIS.

We have been very focused on Al Qaeda in Idlib province, leaders of Al Qaeda that make their way to Idlib province often do not make their way out of there. We have to ask a question – why and how is Ayman Al Zawahiri’s deputy finding his way to Idlib province? Why is this happening? How are they getting there? They are not paratroopers.

And the approach – I will not talk about anything the U.S Government has done in certain parts of Syria on this problem – but the approach by some of our partners to send in tens of thousands of tonnes of weapons and looking the other way as these foreign fighters come into Syria may not have been the best approach – and Al Qaeda has taken full advantage of it and Idlib now is a huge problem. It is an Al Qaeda safe haven right on the border with Turkey.

So, that is something we will be in very close discussion with the Turks on and as we did in some places, sealing the border, making sure nobody can cross – is something we might have to think about in Idlib province because it’s a huge problem, it’s a different problem than ISIS but it is a major problem and something we have to focus on as a counter-terrorism objective.”