Open Thread June 4, 2023
Tax Deal Open Thread Theater, Angry Bear, angry bear blog
Open Threads can be done weekly if needed. Don’t clutter up posts. I am not the cleaning lady for off topic comments.
Every Star Trek Ship For Captain Data After Picard Season 3, screenrant.com. Intriguing series or movie. Data as a Star Ship captain. Especially now with the advent of AI computer beings.
I watched some of StarTrek: Picard while on a cruise (free) but quickly lost interest.
However, burgeoning AI should allow franchise producers to advance to holographically projected versions of Data that would seem to plausibly represent where cybernetics is going.
No reason why future robots need to be real, maybe. Would Trekkies approve?
OpenAI Introduces ChatGPT App for the iPhone
NY Times – May 18 (sort of slipped by?)
Since ChatGPT debuted in November, hundreds of millions of people have experimented with the online chatbot, which can answer questions, write poetry, draft emails and riff on almost any topic from inside a web browser.
On Thursday, OpenAI, the San Francisco artificial intelligence lab behind ChatGPT, unveiled a new version of the chatbot for the iPhone, hoping to build on its enormous popularity. …
In offering its flagship technology to billions of iPhone users, OpenAI is solidifying its position among the giants of the tech industry. ChatGPT is the most prominent example of what is called generative A.I., technology that can generate text, images and other media based on short prompts. Google, Microsoft and various start-ups have released similar bots and have begun to roll such technology into a wide range of online services.
The result of more than a decade of research at companies like Google and OpenAI, these chatbots are poised to remake everything from internet search engines like Google Search and Bing to email programs like Gmail and Outlook. …
Today, the technology tends to complement human workers rather than replace their skills outright.
OpenAI is not the first to introduce technology that lets people use ChatGPT with voice; some small companies and independent developers have already done so. Microsoft also offers a version of its Bing chatbot that responds to voice commands.
The new iPhone app is free. Subscribers of ChatGPT Plus — available for $20 a month — can use a more powerful version of the chatbot based on a technology called GPT-4.
OpenAI began rolling out the app in the United States on Thursday and will expand into other countries in the coming weeks. A version of the app for Android phones is also in the works.
ChatGPT comes to us from OpenAI …
Wikipedia: OpenAI is an American artificial intelligence (AI) research laboratory consisting of the non-profit OpenAI Incorporated and its for-profit subsidiary corporation OpenAI Limited Partnership. OpenAI conducts AI research with the declared intention of promoting and developing a friendly AI.
OpenAI was founded in 2015 … Microsoft provided OpenAI LP with a $1 billion investment in 2019 and a $10 billion investment in 2023. …
As of January 2023, OpenAI was in talks for funding that would value the company at $29 billion, double the value of the company in 2021. On January 23, 2023, Microsoft announced a new multi-year 10 billion USD investment in OpenAI. Rumors of this deal suggested Microsoft may receive 75% of OpenAI’s profits until it secures its investment return and a 49% stake in the company
The investment is believed to be a part of Microsoft’s efforts to integrate OpenAI’s ChatGPT into the Bing search engine. Google announced a similar AI application (Bard), after ChatGPT was launched, fearing that ChatGPT could threaten Google’s place as a go-to source for information.
On February 7, 2023, Microsoft announced that it is building AI technology based on the same foundation as ChatGPT into Microsoft Bing, Edge, Microsoft 365 and other products. …
So, that’s done.
Biden Signs Fiscal Responsibility Act in End to Debt Limit Crisis
NY Times – June 3
Now that the bill is law, the nation will not risk running out of money to pay its obligations for two years.
President Biden signed the Fiscal Responsibility Act of 2023 into law on Saturday, ending for now the threat of economic calamity from a default on the nation’s debt and putting limits on spending for two years.
The White House issued a statement saying that Mr. Biden had signed the legislation, days after it was passed by the House and the Senate following weeks of sometimes bitter negotiations with Republicans.
Mr. Biden’s signature came just two days before the so-called X-date, when Janet L. Yellen, the Treasury secretary, had said the government would run out of cash to pay its debts. Economists had predicted that if it did so, the resulting collapse in faith in America’s financial promises would cause economic instability around the world.
To avoid that, the legislation Mr. Biden signed suspends the nation’s debt ceiling, allowing the government to borrow what it needs to meet its obligations. In remarks to the nation on Friday evening, Mr. Biden said it had been crucial for Republicans and Democrats to find a way to reach an accommodation.
“Nothing — nothing would have been more irresponsible. Nothing would have been more catastrophic,” Mr. Biden said of a default in his first prime-time address from the Oval Office as president. He added a moment later that such an outcome would have meant that “America’s standing as the most trusted, reliable financial partner in the world would have been shattered.” …
Maybe next time the GOP slashes tax revenue, the Dems will take the hint and cut back on spending. That could happen. Otherwise, it would be a really good idea to elect a whole lot more Dems to the House and Senate.
Fred:
That is laughable. The only thing the Monetary Sovereign US can run out of is a budget which may not match what is spent or received in taxes.
Reuters – May, 2013
Fitch Rating sas…
Fitch Ratings says in a newly-published report that the popular perception that sovereigns cannot default on debt denominated in their own currency because of their power to print money is a myth. They can and do. Local currency defaults in the recent era include: Venezuela (1998), Russia (1998), Ukraine (1998), Ecuador (1999), Argentina (2001) and Jamaica (2010 and 2013). Nonetheless, we recognise that local currency defaults are less frequent than foreign currency defaults and are unlikely for countries with debt mainly denominated in local currency at long maturity. …
Undoubtedly, higher inflation can be used to raise seigniorage (the difference between the value of money and the cost to print it) and remittance of central bank profits to the government, up to a point. Nevertheless, in the long run, the ratio of government debt/GDP will rise if the government is running a primary budget deficit (excluding interest payments and including seigniorage), assuming the real growth rate does not exceed the real interest rate, irrespective of the inflation rate. …
Fred:
Were any as big as the US? The US Dollar is still the global currency. It is still in demand by all countries as the global currency. None of the countries you have cited have or had such a demand for their currency. If you are faced with inflation, you tax and take money out of circulation. Does anyone believe there is a pool of currency held by the government? For Social Security, for other programs, etc.? It is credits and debits.
Rather than a budget constraint it is better to have an inflation constraint. It is not suggested all inflation is caused by excess demand. Excess demand is rarely the cause of inflation. Whether it’s businesses raising profit margins or passing on costs, or it’s Wall Street speculating on commodities or houses, there are a range of sources of inflation that aren’t caused by the general state of demand and are not effectively regulated by aggregate demand policies.
If inflation is rising because large corporations have decided to use their pricing power to increase profit margins at the expense of the public, reducing demand may not be the most appropriate tool. What has the economy been going through the lst couple of years with commerce and supply?
Inflation does not usually result from too-high aggregate demand. Taxes can help cool it through minimizing currency. Instead, it comes from monopolists and other predatory capitalists using market power to push prices higher, and it can be tackled by directly regulating those capitalists. We just had a perfect example of this happening.
MMT
Probably we will be ok going forward as long as the US dollar remains the world’s go-to currency. We will know if this is so as long as people are trying to cross our borders, coming in that is.
Y’know, if (going forward) if/when the US guv’mint goes into ‘impending default’ mode again, people around the world might just decide to switch to the Chinese currency.
Wikipedia: The renminbi is the official currency of the People’s Republic of China. It is the 5th most traded currency as of April 2022. The yuan is the basic unit of the renminbi, but the word is also used to refer to the Chinese currency generally, especially in international contexts. …
Fred:
The question or thought about whether the renminbi can realistically gain the status of a “safe haven” currency today can be answered. Such a currency is one investors turn to for safety during times of global turmoil. This is beyond holding it for diversifying their stores of assets denominated in foreign currencies or seeking higher yields on their investments.
History and reality suggests a country seeking this status for its currency must have a sound institutional framework — including an:
– independent judiciary,
– open and transparent government with institutionalized checks and balances, and
– a robust public institutions (especially a credible central bank).
These elements have been seen as vital for earning the trust of foreign investors, both private, official, and including central banks and sovereign wealth funds. Renminbi or Yuan Renminbi Yuan.
2004, it started to float against the dollar rather than being exchanged at 8.3 Yuan to the dollar. US Dollars to Chinese Yuan Renminbi
Long way to go yet.
The US dollar loses its luster out in the world if the US doesn’t pay its debts. If two years hence we are back in that situation, yet again, with no end in sight, then what?
‘Full faith & credit’? ‘The validity of the public debt of the United States, authorized by law … shall not be questioned’?
‘Fool us once, shame on us. Fool us twice, shame on us.’
Fred;
It is not a stagnant economy. It does grow. Biden’s investment will improve the growth.
If no other country has a stable enough currency to fill the bill, so to speak, then perhaps it will remain the US dollar but with much higher interest rates demanded. We could get used to that, I guess. We will have to. Rich folks will still get richer.
The first couple of seasons of Star Trek Next Generation were, like the Original Series, fun; kinda’ campy, not entirely serious. Then sometime around season three, maybe four, it became all war all the time. Same with Deep Space Nine and Lost in Space: first couple of seasons were pretty good, then it became all war all the time. I can’t say, but I’m not sure Gene would approve of what it’s become today. I don’t. They should be home with the grandkids
War Propaganda …
Is France not sovereign?
Outlook for French Finances Dims
NY Times – June 4
S&P Global restated a negative outlook for France’s ability to repay mounting debt. Two other ratings agencies have lowered their views in recent weeks.
… On Friday, S&P Global cautioned that it still had a negative outlook on France’s creditworthiness. It was a step short of a downgrade, which some had expected, but comes after two other ratings agencies have lowered their view of the country in the past month.
S&P Global maintained its investment-grade credit rating for France, a decision that Mr. Macron’s government had eagerly awaited. But in restating a negative outlook first published in January, the ratings agency cited concern about France’s ability to rein in its public finances amid already elevated general government debt.
And it added to concern among analysts about Mr. Macron’s ability, in a tense social and political climate, to move forward with his efforts to lift the country’s competitiveness and growth.
France’s finance minister, Bruno Le Maire, said in an interview late Friday published in the Journal du Dimanche that he viewed the announcement as a “positive signal,” adding: “Our public finance strategy is clear. It is ambitious. And it is believable.”
At the end of April, Fitch Ratings cut France’s sovereign credit rating by one notch, to AA–, after a downgrade in December. Scope Ratings, a European agency, put a negative outlook on its assessment of France last month.
France’s economy, the eurozone’s second largest, is forecast to remain subdued until at least next year, but more worrisome to ratings agencies is the nation’s financial situation. France spent vast sums to shield households and businesses from an inflation crisis and painful pandemic lockdowns. …
France is not ‘sovereign’ in its currency- it uses the Euro which is issued by the ECB.
Maybe ‘Frexit’ will happen to deal with that problem.
(Common sense would suggest that it’s ok for a sovereign to print additional currency to the extent that its economy (GNP) is growing. More than that is asking for trouble, eventually.)
Yes and/or tax it and remove currency.
Uncle Sam giveth & taketh away.
Chris Licht, who led a rightward turn at CNN is out.
Chris Licht Is Out at CNN
NY Times – just in
Chris Licht, the former television producer who oversaw a brief and chaotic tenure as the chairman of CNN, is out at the network, according to a person briefed on the decision.
Mr. Licht’s 13-month run at CNN was marked by one controversy after another, culminating in his exit earlier this week. …
(You may recall the disastrous Trump ‘town-hall’ on CNN recently.)
The Worst Thing to Come Out of Trump’s Town Hall
The Atlantic – May 11
Alas, no free stuff from The Atlantic anymore.
CNN Chairman Defends Decision to Host Trump Town Hall
NY Times – May 11
… “I absolutely, unequivocally believe America was served very well by what we did last night,” Mr. Licht added. “People woke up, and they know what the stakes are in this election in a way that they didn’t the day before. And if someone was going to ask tough questions and have that messy conversation, it damn well should be on CNN.”
The town hall, which aired in prime-time on Wednesday, featured Mr. Trump deploying a fusillade of falsehoods, sometimes too quickly for the moderator to intercept. It was a preview of what American journalism can expect from a 2024 campaign with the former president, who despite his ubiquity in political life has rarely appeared on mainstream TV outside of Fox News since leaving office.
If the 2016 campaign showed that many Americans could not agree on common facts, the Babel-like nature of Wednesday’s New Hampshire town hall suggested that voters now occupied wholly different universes. Mr. Trump repeated a web of conspiracies about a stolen election and the “beautiful day” of the Capitol riot, language that was likely to befuddle half the viewing audience and resonate as gospel with the rest. …
… Critics said it was reckless for the network to provide a live forum to Mr. Trump, given his track record of spreading disinformation. Even the network’s own commentators appeared taken aback by what had transpired on its airwaves. “We don’t have enough time to fact check every lie he told,” Jake Tapper told viewers on Wednesday night.
The town hall was watched by 3.3 million people, according to Nielsen, a significant increase from CNN’s typical audience on an average weeknight at 8 p.m. That was slightly more than the average viewership for Tucker Carlson’s Fox News program, which was seen by an average of 3.2 million people in the first three months of the year.
Mr. Licht, who took over CNN last year after the network was acquired by Warner Bros. Discovery, has had a rocky tenure, and some journalists there have bristled at his public comments that the network had veered too far into an anti-Trump stance when Mr. Trump was in the White House. Mr. Licht has said CNN must appeal to more centrists and conservative voters, a strategy that has support from his corporate superiors. …
In other news …
Doug Burgum, Wealthy North Dakota Governor, Enters Presidential Race
NY Times – just in
Gov. Doug Burgum, the Republican governor of North Dakota who rose from a chimney sweep to become one of the richest men in the state, announced a campaign for president on Wednesday, entering an increasingly crowded race in which he faces exceedingly long odds.
“We need a new leader for a changing economy,” Mr. Burgum wrote in an opinion essay in The Wall Street Journal that focused heavily on his business acumen. He plans to appear at an event around midday in Fargo, N.D.
The size of the field signals that former President Donald J. Trump, the Republican front-runner, has not scared off many challengers. But he has also yet to fully consolidate support behind his candidacy, and numerous rivals apparently see a path to the nomination, no matter how narrow it might be.
As the leader of his deep-red state, Mr. Burgum has overseen a period of significant economic expansion and promoted staunchly conservative policies.
This year, Mr. Burgum signed into law a near-total ban on abortion and created significant restrictions on gender transition care, including banning any requirements that teachers or school administrators use a student’s preferred pronouns. …
(Might settle for VP post under DeSantis or Trump.)
Fun fact: ND ranks 48th among US states in population, between SD and Alaska.)
Justices Thomas and Alito Delay Release of Financial Disclosures
NY Times – just in
Justice Clarence Thomas delayed releasing his annual financial disclosure form with the justices on Wednesday after recent revelations cast scrutiny on his travel, gifts and real estate dealings with a conservative billionaire donor from Texas.
Like Justice Thomas, Justice Samuel A. Alito Jr. also asked for a 90-day extension to file the forms, which detail gifts, investments and other financial holdings, according to the Administrative Office of the U.S. Courts, which handles the financial forms and the database where they are publicly disclosed. …
House Is Paralyzed as Far-Right Rebels Continue Mutiny Against McCarthy
NY Times – June 7
Hard-right Republicans pressed their mutiny against Speaker Kevin McCarthy into a second day on Wednesday, keeping control of the House floor in a raw display of their power that raised questions about whether the speaker could continue to govern his slim and fractious majority.
Mr. McCarthy, who enraged ultraconservative Republicans by striking a compromise with President Biden to suspend the debt limit, has yet to face a bid to depose him, as some hard-right members have threatened. But the rebellion has left him, at least for now, as speaker in name only, deprived of a governing majority.
“House Leadership couldn’t Hold the Line,” Representative Matt Gaetz, Republican of Florida and a leader of the rebellion, tweeted on Wednesday. “Now we Hold the Floor.”
After being forced for the second day in a row to cancel votes as they haggled privately with members of the House Freedom Caucus to get them to relent, leaders told Republican lawmakers on Wednesday evening that they were scrapping votes for the remainder of the week. In a remarkable act of intraparty aggression, about a dozen rebels ground the chamber to a halt on Tuesday by siding with Democrats to defeat a procedural measure needed to allow legislation to move forward, and business cannot resume until they back down and vote with their own party.
It underscored the severe consequences Mr. McCarthy is facing for muscling through a debt ceiling agreement with the White House that contained only a fraction of the spending cuts Republicans had demanded. The episode has reignited divisions within Mr. McCarthy’s own leadership team, with the speaker suggesting his No. 2 was in part to blame for the dysfunction. And it was a blunt reminder of the challenge Mr. McCarthy will face in holding together his conference to pass crucial spending bills this year, which will be required to avert a government shutdown this fall and punishing across-the-board spending cuts in early 2025.
The paralysis that has gripped the House this week — an exceedingly rare instance of a faction of the majority holding its own party hostage — recalled Mr. McCarthy’s weeklong, 15-round slog to win his post, which required him to win over many of the same hard-right lawmakers instigating the current drama.
On Wednesday night, Mr. McCarthy conceded that there was “a little chaos going on,” though he insisted that he would get the party agenda back on track. …
“We’ve been through this before; you know we’re in a small majority,” Mr. McCarthy told reporters earlier in the day. “I don’t take this job because it’s easy. We’ll work through this, and we’ll even be stronger.”
But he also appeared to blame the impasse at least in part on Representative Steve Scalise of Louisiana, the majority leader, saying that he had caused a misunderstanding that paved the way for the spontaneous hijacking of the House floor on Tuesday.
“The majority leader runs the floor,” Mr. McCarthy said.
The temper tantrum from the right had little immediate impact other than to deprive Republicans of the chance to pass a messaging bill that was all but certain to die in the Senate. The legislation that the rebels blocked is aimed at guarding against government restrictions on gas stoves and other federal regulations.
But ultraconservative Republicans said much more was at stake, arguing that Mr. McCarthy had betrayed promises he made to them during his fight for the speakership and now had to be forced into honoring them.
“There was an agreement in January and it was violated in the debt ceiling bill,” said Representative Ken Buck, Republican of Colorado. He said the conversations with Mr. McCarthy on Wednesday were to discuss “how to restore some of that agreement.” …
House Is Paralyzed as Far-Right Rebels Continue Mutiny Against McCarthy
Members of the ultraconservative House Freedom Caucus refused to surrender control of the floor, forcing G.O.P. leaders to scrap votes for the week and leaving the speaker facing what he conceded was “chaos.”
Hard Right Grinds House to a Halt, Rebuking McCarthy for the Debt Deal
NY Times – June 6
Members of the ultraconservative Freedom Caucus effectively shut down the House floor for several hours, calling the speaker’s fiscal compromise with President Biden a betrayal.
A group of hard-line Republicans hijacked the House floor on Tuesday, grinding legislative business to a halt for several hours in a striking display of ire at Speaker Kevin McCarthy for making a deal with President Biden to suspend the debt limit and banding together with Democrats to muscle it to passage.
The mutiny, staged by nearly a dozen members of the ultraconservative House Freedom Caucus as leaders sought to bring up legislation to guard against restrictions on gas stoves and other federal regulations, reflected the bitter acrimony lingering in the Republican ranks after passage of the debt limit measure last week.
It indicated that, even as right-wing lawmakers suggest they are not yet inclined to try to oust Mr. McCarthy from his post over the compromise, they plan to use their clout in the closely divided House to make the speaker’s job impossible unless he bows to their will.
“We’re concerned that the fundamental commitments that allowed Kevin McCarthy to assume the speakership have been violated as a consequence of the debt limit deal, and the answer for us is to reassert House conservatives as the appropriate coalition partner for our leadership, instead of them making common cause with Democrats,” Representative Matt Gaetz of Florida told reporters.
He spoke after he and 10 other Republicans took the extraordinary step of voting against a procedural measure to set ground rules for legislative debate — usually a party-line vote — to register their protest, catching Mr. McCarthy and his leadership team off guard. Their decision to stage the demonstration was all the more remarkable because the members actually supported the underlying bill. …
A $1T Borrowing Binge Looms After Debt Limit Standoff
NY Times – June 7
The government has avoided default, but the effects of the debt-ceiling brinkmanship may still ripple across the economy.
The United States narrowly avoided a default when President Biden signed legislation on Saturday that allowed the Treasury Department, which was perilously close to running out of cash, permission to borrow more money to pay the nation’s bills.
Now, the Treasury is starting to build up its reserves, and the coming borrowing binge could present complications that rattle the economy.
The government is expected to borrow around $1 trillion by the end of September, according to estimates by multiple banks. That steady state of borrowing is set to pull cash from banks and other lenders into Treasury securities, draining money from the financial system and amplifying the pressure on already stressed regional lenders.
To lure investors to lend such huge amounts to the government, the Treasury faces rising interest costs. Given how many other financial assets are tied to the rate on Treasuries, higher borrowing costs for the government also raise costs for banks, companies and other borrowers, and could create a similar effect to roughly one or two quarter-point rate increases from the Federal Reserve, analysts have warned. …
Record Pollution and Heat Herald a Season of Climate Extremes
NY Times – June 8
Scientists have long warned that global warming will increase the chance of severe wildfires like those burning across Canada and heat waves like the one smothering Puerto Rico.
… Fires are burning across the breadth of Canada, blanketing parts of the eastern United States with choking, orange-gray smoke. Puerto Rico is under a severe heat alert as other parts of the world have been recently. Earth’s oceans have heated up at an alarming rate.
Human-caused climate change is a force behind extremes like these. Though there is no specific research yet attributing this week’s events to global warming, the science is unequivocal that global warming significantly increases the chances of severe wildfires and heat waves like the ones affecting major parts of North America today.
Now comes a global weather pattern known as El Niño, which can drive up temperatures and set heat records. Thursday morning, scientists announced its arrival.
Taken together, the week’s extremes offer one clear takeaway: The world’s richest continent remains unprepared for the hazards of the not-too-distant future. A sign of that came on Wednesday when Canada’s prime minister, Justin Trudeau, said his government may soon create a disaster response agency in order to “make sure we’re doing everything we can to predict, protect and act ahead of more of these events coming.”
The recent fires have also punctured the notion that some places are relatively safe from the worst hazards of climate change because they’re not near the Equator or they’re far from the sea. Almost without warning, smoke from faraway fires upended daily life. …
NY Times: Air Quality and Smoke ›
Washington, D.C. – Hazardous
New York – Very Unhealthy
Chicago – Unhealthy for some
Boston – Moderate
Source: Airnow.gov · Data as of 8 a.m. Eastern.