Relevant and even prescient commentary on news, politics and the economy.

District Federal Court Rips Administration on Census

I have had enough court time to last a life time. While mine was not fun and it was a battle, this I find hilarious. It is a well placed shot across the bow of someone who believes they are impervious to society, the courts, and morality.

The census case arrived in front of Manhattan District Federal Judge Furman requesting that he delay proceedings. Calling it the ‘latest and strangest effort’ in its crusade to delay proceedings in the case. He said what made the request ‘most puzzling, if not sanctionable’ is that the Trump administration had made a similar request before the trial started, and had been rejected by not only the district court judge, but by an appeals court and the Supreme Court.

Furman pointed out, “when the Supreme Court announced last week it was taking up the case, “it knew that this Court had completed trial, and it presumably expected that the Court would enter final judgment before the date that it set for oral argument.”

Bashing the administration for taking its request to an appeals court before he had a chance to rule on it. The appeals court again denied that request as premature.

“If Defendants’ motion in this Court comes close to the sanctionable line, that filing would sure seem to cross it,” Furman wrote in his order.”

Other quotable quotes?

– “Unless burdening Plaintiffs and the federal courts with make-work is a feature of Defendants’ litigation strategy, as opposed to a bug, it is hard to see the point. To borrow from Camus, “[o]ne must imagine Sisyphus happy.”

– “Tellingly, this time, Defendants do not even attempt to argue that they are entitled to the extraordinary relief of a stay of all proceedings under the traditional factors…In fact, the words ‘harm” and ‘injury’ do not appear anywhere in their motion. That is for good reason, as the notion that they — or anyone else — would suffer ‘irreparable harm’ without a stay is laughable.”

– “Defendants’ motion makes so little sense, even on its own terms, that it is hard to understand as anything but an attempt to avoid a timely decision on the merits altogether.

– “Enough is enough.”

State of New York vs US Department of Commerce

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Good payroll reports will probably continue until next spring

Good payroll reports will probably coninue until next spring

One of my continuing mantras over the years has been that spending leads hiring. It is simply demonstrable fact that, going back over 50 years, upward or downward changes in trend in consumer spending as revealed by retail sales, happen before similar changes in trend by jobs.

It turns out that there’s an even close correlation when we substitute aggregate payrolls (jobs x hours x pay) for the number of jobs alone. Here’s what that looks like over the past 50+ years. Real retail sales are in red, real aggregate payrolls in blue, YoY, and averaged quarterly to cut down on noise:

The only exceptions to the rule are the two oil shocks in the 1970s, the Fed-induced recession immediately thereafter in 1981, and the laste 1990s tech boom. Even in two of cases, there is a very slight lead time when we look monthly:

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Why Free Public Higher Education Is Not a Sop to the Upper Middle Class

Why Free Public Higher Education Is Not a Sop to the Upper Middle Class

Lots of bad op-ed stuff gets published in the New York Times and other mass circulation outlets, so I usually give it a pass, but today’s attack on free higher education by David Leonhardt is about my day job, so I have to make an exception.  He repeats the utterly bs line that, since most college students are from the upper half of the income spectrum, using public funds to pay their way is regressive.

No, no no!

First, why is the college student population so skewed to the higher brackets?  There are many reasons, but the financial burden of attending—not only tuition, but also the opportunity cost of not working—is a big factor.  The problem with free higher ed is that, the way it’s usually framed, it doesn’t go far enough.  As in European countries and elsewhere that take this issue seriously, students should not only get free tuition but a stipend.  We can afford and should demand the same.

Second, what Leonhardt doesn’t mention is the student-worker phenomenon, the crushing workload on college students holding down part time and even full time jobs.  Evergreen State College, where I work, just released the results from its survey of incoming students, and more than half expected to work to support themselves while attending classes, most of them more than 20 hours per week.  I see this reality every day in the classroom, where students struggle with not enough time to keep up with assignments, sometimes even nodding out to recover from a late night shift, or the emails apologizing for being absent because of a work schedule change.

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I disagree with Jennifer Rubin

(Dan here…lifted from Robert’s Stochastic Thoughts)

by Robert Waldmann

I disagree with Jennifer Rubin

Conservatives object to the Washington Post defining never-ever-ever Trumper Jennifer Rubin as a conservative. Reflecting, I had to admit that I hadn’t disagreed with anything she wrote for months. Now, finally, I do. But, sadly, this isn’t evidence that she is still a conservative. She has clearly become a radical centrist third way mugwump (RC3WM).She argues that the 2018 blue wave shows that Democrats should reject Bernie Sanders and rely on a poll conducted by “The Third Way”.

I think this is nonsense consisting entirely of setting up an oxymoronic straw man and pretending that values shared by conservatives, liberals, centrists, progressives, socialists, and fascists belong to conservatives.

Her column.

My comment

I don’t see any evidence that people rejected Sen Sanders’s policy proposals, which are actually fairly moderate. It is very easy to get issue poll results one wishes by choosing the questions. Notably, the ACA is only moderately popular (50% approval) while Medicare for all has 70% approval (recently including Donald Trump).

On entitlements the moderate centrist approach is to achieve trust fund solvency with balanced tax increases and benefit cuts. The vast majority of the public wants more generous pensions, expanded medicaid and an increased Medicare budget.

 

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Solow on Friedman’s 1968 Presidential Address and the Medium Run

Mark Thoma had this up on Facebook. and pulled this from Tim Taylor’s Conversable Economist. It is an interesting read.

“Fifty years ago in 1968, Milton Friedman’s Presidential Address to the American Economic Association set the stage for battles in macroeconomics that have continued ever since. The legacy of the talk has been important enough that in the Winter 2018 issue of the Journal of Economic Perspectives, where I work as Managing Editor (Tim Taylor), we published a three-paper symposium on ‘Friedman’s Natural Rate Hypothesis After 50 Years.'”

What was the key insight or argument in Friedman’s 1968 address? Friedman offers a reminder that interest rates and unemployment rates are set by economic forces. Friedman uses this idea to build a distinction between the long-run and the short-run. In the short run, it is possible for a central bank like the Federal Reserve to influence interest rates and the unemployment rate. In the long run, there is a “natural” rate of interest and a “natural” rate of unemployment which is trying to emerge, gradually, over time from all the various forces in the economy.

The rest you can read for yourself at Tim’s site.

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More House Speaker Details on Who Will Lead

A Rehash

Paul Krugman noted on twitter, this is a group that is “still in the old cringe position, buying into GOP demonization (which happens to any strong Democrat) despite a huge midterm victory.” Cringing at the GOP’s demonization is a tactic that too many Democrats embraced in the past and is what sent so many of them on a journey rightward in search of validation. In other words, it is a losing strategy undermining liberal values. The really superb Democratic candidates in the 2018 midterms completely rejected the approach and it is clear that Nancy Pelosi joins them.

Nancy LeToureau at Washington Monthly detailed a Pelosi experience giving her remarks on Twitter. “On Wednesday some young climate activists joined by newly elected Alexandria Ocasio Cortez held a demonstration at Nancy Pelosi’s office. While we can debate whether it is a smart move to hold such an event at the office of a leader who is on your side as opposed to the myriad of Republican leaders who are climate deniers, Pelosi welcomed them with open arms.

Nancy Pelosi, Nov 13, 2018 on Twitter:

Deeply inspired by the young activists & advocates leading the way on confronting climate change. The climate crisis threatens the futures of communities nationwide, and I strongly support reinstating the select committee to address the crisis.

We welcome the presence of these activists, and we strongly urge the Capitol Police to allow them to continue to organize and participate in our democracy.

Nancy LeToureau: These types of actions are what makes Pelosi a great leader and is a wonderful example of how Democrats embrace grassroots activism and organizing.

The Letter’s 17

On the same day, some House Democrats were organizing against the election of Pelosi as the next Speaker of the House. There are those who mistakenly conflate the two developments; however, the group challenging Pelosi’s leadership has different motives.

About a dozen incumbent Democrats and a half-dozen incoming Democrats are preparing a letter pledging to not support Pelosi on the House floor for speaker. The members also intend to note another contingent of Democrats who privately say they won’t support the longtime California Democrat but won’t sign the letter, according to Rep. Tim Ryan (D-Ohio), one of the ringleaders of the effort to block Pelosi.

Sources (HuffPost) familiar with the letter say there are currently 17 names on it, but the group is trying to get more than 20 members before releasing it. Currently on the letter, though not certain to stay on it, are:

– Tim Ryan (D-Ohio)
– Seth Moulton (D-Mass.)
– Kathleen Rice (D-N.Y.)
– Ed Perlmutter (D-Colo.)
– Kurt Schrader (D-Ore.)
– Filemon Vela Jr. (D-Texas)
– Marcia Fudge (D-Ohio)
– Brian Higgins (D-N.Y.)
– Stephen Lynch (D-Mass.)
– Linda Sanchez (D-Calif.)
– Jim Cooper (D-Tenn.)
– Jeff Van Drew (D-N.J.)
– Joe Cunningham (D-S.C.)
– Max Rose (D-N.Y.)
– Anthony Brindisi (D-N.Y.)
– Ben McAdams (D-Utah)

There is another contingent of Democrats ― including Conor Lamb (D-Pa.), Dan Lipinksi (D-Ill.), Ron Kind (D-Wis.), Abigail Spanberger (D-Va.), Jason Crow (D-Colo.), Haley Stevens (D-Mich.), Elissa Slotkin (D-Mich.), Mikie Sherrill (D-N.J.) and Andy Kim (D-N.J.) ― who are seen as likely to vote against Pelosi, but who appear to be hesitant to sign the letter.

In comparison, just “How progressive Is Nancy Pelosi” when compared to the 17?

Kevin Drum (Mother Jones) writes; “not only has Pelosi consistently been in the top third of the most liberal Democrats in the House, Pelosi is a lot more liberal than Republican Paul Ryan is conservative.” The insurgency against Pelosi amongst House Democrats consists of people who are to Pelosi’s right on the ideological scale. The 17 Democratic signatories on the anti-Pelosi letter when compared to FiveThirtyEight’s DW NOMINATE ranking / Trump scorecard shows that only two of those people have voted against Donald Trump’s policy preferences more than Pelosi has.

The person from that group who’s being floated as a potential replacement for Pelosi, Rep. Marcia Fudge of Ohio, is accused of being openly hostile to LGBTQ rights. Osita Nwanevu of the New Yorker: “The anti-Pelosi stuff in Congress is mostly backed by centrist & conservative Dems who want to cave to the right’s sexist & latently anti-LGBT messaging (‘San Francisco values’) against her.”

Do We Want to Be a Part of the 17?

One sure way of dampening the forward progressive movement of the Democrats in the House is to have open warfare amongst ourselves on leadership when the leader is already more progressive than the upper third of Democrats in the House and much of the 17. Such fighting will give rise to questioning of the ability of new and incumbent representatives to gain bi-partisan agreement in the House for passage of Democratic bills. If they can not agree amongst themselves without open warfare, then we have already lost even before the new session has started.

This is not the time to kick the most experienced Progressive House leader out the door. It is time to start grooming new and younger leadership who have returned to the House over the last decade. First term representatives should spend time learning the politics of the House, the Democrats and Republicans, and avoid the conflict being led by those to the right of Pelosi. Only two of the 17 have voted against Donald Trump’s policy preferences more than Nancy Pelosi.

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Weekly Indicators for November 12 – 16 at Seeking Alpha

by New Deal democrat

Weekly Indicators for November 12 – 16 at Seeking Alpha

My Weekly Indicators piece is up at Seeking Alpha.

If my reference frames are well- constructed, economic trends ought to start out in the long leading forecast, then start to show up in the short leading forecast, and finally make it through to the coincident nowcast.

Almost 6 months ago, the long leading forecast changed from positive to neutral for the first time.  It’s been flirting with further deterioration ever since.  Well, this week ….

As usual, clicking through and reading is a way to help support my putting in the effort to describe and forecast the economy for you.

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MbS Guilty!

MbS Guilty!

According to the top stories in both the New York Times and Washington Post this morning, somebody in the CIA has leaked that Mohammed bin Salman (MbS) ordered the assassination of journalist Jamal Khashoggi.  Of course no sensible observer is remotely surprised, but the Trump administration had been working mightily to deny this obvious fact, with reports surfacing that they were plotting to send Turkish cleric Gulen to Turkey as authoritarian President Erdogan has long been demanding (Gulen is Erdogan’s all-purpose scapegoat for everything) in the hopes that Erdogan would stop making it clear that MbS was guilty of ordering the assassination.  But now there is no point in that as the cat is fully out of the bag, no matter how much this leak will anger Trump (Fake CIA leak!).  Indeed, it may well have been reported unhappiness by various government officials in the face of this effort to sacrifice Gulen that triggered the leak.

What is a bit surprising is that the leak involved publicizing that NSA bugs the Saudi embassy, although I would imagine that anybody there who did not know that was stupid.  But crucial to the leak is both that MbS phoned his full brother, Khalid bin Salman, the Saudi ambassador to the US, ordering him to phone Khashoggi and tell him he should go to the Saudi consulate in Istanbul to the documents he needed to marry his Turkish fiancee, and that he would be safe in doing so, and that KbS then followed through and made the phone call. The only thing we do not know is whether KbS was in on what was going to happen to Khashoggi or not when he made the phone call.

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Credit remains loose, but big borrowers aren’t interested; real consumer spending may be stalling

by New Deal democrat

Credit remains loose, but big borrowers aren’t interested; real consumer spending may be stalling

We interrupt this coverage of the ongoing Trump Boom (c) to advise you that two more long leading indicators, while still positive, are showing at least some weaknesses.  This story is up at Seeking Alpha.

As usual, reading the story over there is both informative for you and a little $$$ revwarding for me.

Also, as an aside, once corporate profits for Q3 are reported in two weeks as part of the revised GDP report, that will be a good time to do a comprehensive update of the long leading forrecast through 2019.

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