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Would Trump Try to Manipulate Economic Data Before the Election?

Dean Baker considers whether Trump’s group of supporters would be able to manipulate the bureacracies of the federal government to alter the economic outlook of the nation in a more expansive way than Larry Kudlow and others, but the data itself ( if that is even needed?)  He says not likely, but how creative would one need to be?

Dean Baker wonders out loud…

Would Trump Try to Manipulate Economic Data Before the Election?

I talked to a reporter last week who wanted to know if Donald Trump could manipulate economic data for political advantage. For example, could Trump make the Bureau of Labor Statistics (BLS) show a lower rate of unemployment or the Bureau of Economic Analysis show a higher rate of GDP growth, just before the election next fall?

…First, the people at these and other statistical agencies are dedicated professionals.

…Furthermore, since so much of the data are publicly available, it would be very hard to do this without being detected.

…Theoretically, someone could do something like this, but it would have to be a person who was very knowledgeable about the data. And, they would almost certainly need the cooperation of at least 20 or 30 people at the BLS.

 

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Has 21st century conservatism contributed anything useful at all ?

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

by Robert Waldmann

Has 21st century conservatism contributed anything useful at all ?

This is a question I haven’t asked myself. I have long looked for reasonable and reasonably honest conservatives. It is frustrating, because I have found many, but few are still conservative. I don’t want to get distracted from my distraction; but there is a pattern of me finding a conservative whom I consider reasonable, then that guy breaks with the conservative movement within a year.The new topic is conservative ideas. The question is, is there any conservative thought which is worth consideration, which they hadn’t already written and which not been said by 1900. I suppose this might be considered an unfair question, since I demand something new from a school centered on suspicion of the new. However, they have embraced many new and worthless ideas and proposals (see below) so I don’t think I am being unfair.

This is a long very self indulgent post. It is twitter overload. I am going to:

1) bring a twitter discussion over here,

2) try to think of worthwhile 21st century conservative ideas, and

3) try to think of worthwhile 21st century non-conservative ideas (to be fair — it might just be that my effort under 2 fails because of my ignorance or my interpretation of “worthwhile” and “2st century”).

OK the twitter thread (which will make it painfully clear why I surfed over to blogger I mean “4.1/3” really ???).

It starts with this very interesting post on challenges to liberalism and liberals’ responses.

Ross Douthat asked a constructive and interesting (implied) question

Ross Douthat @DouthatNYT

18h

The question I’m left with at the end of this interesting @zackbeauchamp crisis-of-liberalism survey is whether he thinks there’s anything that liberalism can learn or drawn on from the *right* in order to survive and flourish anew?

I replied @robertwaldmann

Obviously the reason you are left with that question is that neither he nor you can think of anything useful that anyone can learn from conservatives. The reason is that all alleged conservative insights have been disproven by massive evidence.

In fact I challenge you. I suspect the answer will be to claim for conservatism universal values and widespread beliefs or to pretend that the only alternative to conservatism is something like Marxism. I say conservatism has the same epistemic standing as astrology.

Dilan Esper contributed reasonable thoughts aiming for constructive discussion. I want to thank Dilan Esper for being helpful and constructive. I fear my tone on twitter and here does not communicate my sincere appreciation of a good faith effort. Also MuchTL:DR , his effort confirms my prediction.

 

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I get Ruthless With David Leonard

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

by Robert Waldmann

I get Ruthless With David Leonard

David Leonard picks cherries in a generally good op-ed. I agree entirely with his general conclusion that Democrats should run a populist campaign (no triangulation — he should have noted that Clinton ran on raising taxes on the rich and cutting taxes on the middle class in 1992 — he was a populist before he was a triangulator). He also says don’t talk about decriminalizing border crossing or eliminating private health insurance. I agree entirely. He relies on a Pew poll on issues. It is an interesting poll by a good pollster.

However, I think there should be a rule that any commentary on polls should consider all available still relevant polls. The norm of non data journalists writing about data is still to comment on one poll. This is nonsense. It is like election night coverage based on an interview with one voter. There is, I think, no excuse for looking at data other than averages of polls. I think fivethirtyeight.com can improve on the simple average, but that’s not my current assertion. I am asserting that any commentatory must justify (to an editor not the readers) every decision to not consider every poll which is not considered.

I was triggered by this passage justified by three picked cherries.

Yet Democrats are frittering away their advantage — and damaging their image. Last fall, most Americans had a favorable view of the Democratic Party, according to the Pew Research Center. That makes sense, because Democrats ran a populist campaign in the 2018 midterms, focused on pocketbook issues that dominate many people’s lives, like wages and medical costs.This year, the polling has flipped. Most Americans now have an unfavorable view of the party, no better than their view of the Republican Party. Likewise, slightly more voters say the “ideas being offered by the Democratic candidates” would hurt the country than say would help, according to the NPR poll.

 

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Healthcare News PBM Profits, Expensive Drug(s), Food Protein, and the Opioid Scam

Cigna gets major boost from Express Scripts in Q2,” Robert King, FierceHealthcare, August 1, 2019

And some claim PBMs do not matter in the cost of healthcare? Cigna healthcare insurance generated ~ $38 billion in revenue the second quarter 2019 and a major increase due mostly to a merger with pharmacy benefit manager (PBM) Express Scripts.

According to company financial results released Thursday, Cigna’s pharmacy services business generated $23.5 billion in revenue in the second quarter which represents a massive increase compared to the $1.1 billion generated in the second quarter of 2018. The company reported $1.41 billion in net income.

The major reason for the spike is the gain from the membership and resources achieved from the deal for Express Scripts. Cigna completed the $67 billion merger with the PBM giant late last year.

More Plant-Based Protein in Diet May Add Years,” Nicole Lou, MedPageToday, August 27, 2019

“Significant reductions were found (specifically) in mortalities related to cardiovascular disease. Norie Sawada, MD, PhD, of Japan’s National Cancer Center in Tokyo reported and colleagues reported a positive result in a prospective cohort study of plant protein being substituted for meat protein. It was reported in recent JAMA Internal Medicine study, “Association of Animal and Plant Protein Intake With All-Cause and Cause-Specific Mortality.”

The JAMA study (Association of Animal and Plant Protein Intake With All-Cause and Cause-Specific Mortality) suggests diets with higher plant-based protein intake may contribute to long-term health and longevity. In this cohort study; 70,696 Japanese adults were followed up on for a mean period of 18 years. The outcome associated a higher intake of plant protein resulted in lower total mortality. Moreover, the substitution of plant protein for animal protein, mainly for red or processed meat protein, was associated with lower risk of total, cancer-related, and cardiovascular disease–related mortality.

Furthermore, switching out 3% of daily calories from red meat to plant protein — approximately 260 g of a soy-based food for the average person eating 2,000 calories per day — was linked in statistical models (not through analysis of individuals who actually changed their diets) to reductions in mortality risk.

It is no secret retail drives the meat processing market where large manufacturers and meat packers are big enough to control the market and can drive the pricing down or up per each of cattle. Smaller cattle producers can be driven out of the market as they do not have the massive volume ability to lower their costs of production past a certain point. The criticisms of the plant based protein study I have read are similar to the criticism I have read limiting opioid prescriptions in which they advocate do not limit opioid at all. We could all do with less red meat in our diets which still remains a reality.

The $6 Million Drug Claim, Katie Thomas and Reed Abelson, NYT, August 25, 2019

The link should take you to a different site other than the NYT where you can read the article.

Alexion Pharmaceuticals manufactures Strensiq a drug used to treat a rare bone disease perinatal/infantile and juvenile – onset hypophosphatasia. Adult Dawn Patterson also suffers from the same disease, the excruciating pain from it, which leaves her struggling to work or care for her family. It is a rare disease found more often in children and even rarer in adults.

Dawns husband’s union covers the cost of the drug. The union is suffering sticker shock from the mounting bills for treatments of her and her two of her children who also have the disease. In 2018, the union faced a potential $6 million bill for the Patterson household with an estimated a lifetime cost of $60 million to treat the family over 10 years.

The cost of Strensig as well as other drugs is coming under increased scrutiny and debate over whether any drug should cost $millions of dollars after cost of R&D and start up are recovered. Americans are being priced out of lifesaving treatments as drug companies maximize their profits well beyond start up costs. It has been found, the investment of $1 invested in R&D has provided $14.50 in revenue for cancer drugs (World Health Organization).

As I reported in “Cigna gets major boost from Express Scripts in Q2” (above), Pharmacy Benefit Managers are taking a hefty cut in the process in representing insurance companies with manufacturers. In an earlier post “Can you Patent the Sun,” I had talked more on the topic of costs and company reasoning to set higher prices. Manufacturers are pricing new and older drugs higher and establishing a pseudo morality to maximize their profits.

The US is more vulnerable than is European countries only because Europe sets pricing rather than allow the market to do so.

Opioid Maker Turned Blind Eye to Diversion, Kristina Fiore, MedPage Today, August 28, 2019

In newly unsealed documents, Mallinckrodt employees were worried the existing programs to prevent opioid diversion were not working. One former employee testified about Mallinckrodt not having a computerized system from 2008 to 2009 for tracking unusual orders. Employees had to use their judgment to identify suspicious sales. U.S. Drug Enforcement Agents met with Mallinckrodt PLC and informed the company the agency viewed it “as the kingpin within the prescription drug cartel.”

Superior Court for the State of Alaska Third Judicial District in Anchorage, State of Alaska, Plaintiff vs. Mallinckrodt PLC, Mallinckrodt LLC, and SPECGX LLC.

“In reality, however Mallinckrodt shipped opioids into Alaska without an adequate system in place to prevent diversion of its opioids and to investigate, report, and refuse to fill orders that it knew or should have known were suspicious, breaching both its common law duties and its statutory duties under Alaska law. Despite its legal and ethical duty to report “suspicious orders” of its drugs, and, upon information and belief, ample red flags of potential diversion, Mallinckrodt has never once reported a single prescriber to state law enforcement or the Alaska State Medical Board. Instead, Mallinckrodt incentivized distributors to flood the State with opioids beyond even what the expanded market for chronic pain market could bear.”

Mallinckrodt Was Required to and Failed to Maintain Effective Controls Against Diversion and to Report Suspicious Prescribers. , Page 35, B

There are multiple state lawsuits being filed federal courts nationwide claiming pharmaceutical companies misled people as to the safety of opioid usage.

Opioid settlement would divide money based on local impact, Geoff Mulvihill and Andrew Welsh-Huggins, AP, August 30, 2019

Purdue the maker of OxyContin is negotiating a multi-billion-dollar settlement to resolve a crush of lawsuits over the nation’s opioid crisis. The settlement contains formulas for dividing up the money amongst state and local governments across the country.

The formulas would take into account several factors; opioid distribution in a given jurisdiction, the number of people who misuse opioids, and the number of overdose deaths.

Spelling out the way the settlement is to be split is meant to prevent squabbles over the money avoiding the mistakes experienced with the hundreds of billions of dollars received under the nationwide settlement with Big Tobacco during the 1990s.

September 8; States Attorneys and Purdue have reached an impasse and it is expected Purdue will now file for bankruptcy. It is not clear what the breakdown is over. One of the four states attorneys negotiating with Purdue, Pennsylvania’s Josh Shapiro said Saturday he intends to sue the Sackler family as other states have.

“I think they are a group of sanctimonious billionaires who lied and cheated so they could make a handsome profit. I truly believe that they have blood on their hands.”

Run75441 (Bill H)

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Trump: When Reality TV Becomes Reality

Trump: When Reality TV Becomes Reality

The New York Times has an excellent dissection today of the Trump presidency as a reality TV show that has managed to set up shop at 1600 Pennsylvania Avenue, written by its chief TV critic, James Poniewozik.  His op-ed digs down into the props and story line of “The Apprentice” and how its tone evolved over its 14-year lifespan.  He places it nicely within the ecosystem of post-Survivor entertainment and the particular celebrity culture it spawned.  Nice job, and read it for yourself.

But there’s something missing.  Yes, that’s who Trump is and how he operates, but he could never have gotten to where he is without cutting deals with people whose personas are light years away from his—the plutocracy, particularly in its financial and resource extraction modes, the Republican Party apparatus in the think tanks and lobby shops in and around Washington, and the Christian Right, with its fixation on the courts as a bulwark against cultural change.  There is a real, which is to say a real real, side to the Trump presidency, and it takes the form of tax cuts, regulatory rollbacks and judgeship appointments.  This differentiates it from reality TV, which is only itself.

And so we are left with an obvious response: stop rebroadcasting the reality TV stuff.  Leave it alone.  Don’t fixate on the bluster, viciousness, racism or obscenity of his tweets and rallies.  Rather, examine the real real viciousness, racism and obscenity built into the policies of the people who use Trump as an avatar, an attention-grabbing figurehead who enables them to hold and use power.  Yes, I’ve said this before, but it’s still the way to go.

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Why is current economic growth called strong?

As of the second quarter the year over year percent change in real GDP is 2.3%.  Virtually everyone refers to this as strong. Why?  By historic standards 2.3% real GDP growth is subpar. It is below the long term growth rate of the economy using virtually any widely accepted estimate of trend or potential growth. Many republicans actually claim that the potential growth rate is now 4%. If so, it would only make Trump’s 2%-3% growth look worse.

In 1967, real GDP growth was 2.7%, significantly stronger than the current rate.  Yet, that was labeled as  a GROWTH RECESSION.  In Obama’s second term, after the recession and economic recovery, his economic expansion averaged 2.4% growth, or essentially the same growth Trump has experienced during what is actually the same economic expansion. But Obama’s record was almost universally labeled as weak growth and Trump’s as strong. Trump recently bragged that the economic expansion just passed ten years, to become the longest in US history.  But  seven and a half years of this was under Obama and only two and a half years have been under Trump. Virtually all the data says that current growth is just a continuation of the trends established under Obama.  To date Trumps policies have had essentially no impact on economic growth. In this expansion  the strongest q/q SAAR was 5.5% in IV 2014 and the strongest  y/y growth was 4.0% in first quarter  2015–both under Obama.

I can understand Trump and the Republican propaganda machine calling 2.4% growth weak and 2.3% growth  “THE STRONGEST ON RECORD” as Trump repeatedly does. 

But why do we let the media and many economist get away with repeating this republican propaganda.  Shouldn’t we be calling them out every time they do this,  for practicing such sloppy economics.

Note, all growth rates are rounded to one decimal point. Economist quote two decimal points just to prove they have a sense of humor.

 

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Labor Day

I was doing my usual reading in the internet world and ran across this comment to another commenter who claimed Labor Day is a made up holiday. A lot of history in this reply:

“‘A made-up holiday that never had a great basis for its existence?’

How about the Ludlow Massacre where 57 miners were killed by Rockefeller guards that set fire to miners tents even though they were on private property? Their union leader was held by two militia members and shot in the back by a third. All they wanted was mine safety, their own doctor instead of a company doctor, an eight-hour day, fair pay and a union. Or how about the five workers shot in the back at McCormick Iron Works as they ran from armed guards. They too were just demonstrating for an eight-hour day and better working conditions generally. How about the women who died in a shirt manufacturing factory in New York? They died because they were deliberately locked in a room with no way out when the building caught on fire. How about the workers hung in Chicago after the Haymarket Riot because the Chicago Tribune just about sealed their fate with a horrific attack on them? The Governor of Illinois pardoned others scheduled to be hung because of what he thought was shaky evidence. What about the five marchers shot by police in a Hunger march in Detroit in the middle of the Depression? Or what about the Battle of the Overpass, where UAW organizers were beaten and bloodied by Ford thugs while the Dearborn police stood by and watched. That is except for one time when they stopped the Ford goons from further beating on a lady unionist. The police thought Fords thugs were going to kill the lady. What about Walter Reuther, who was picked up an thrown down again over three flights of stairs, probably avoided being killed because some reporters saw what was happening, picked Reuther up and threw him in their car, then drove away. Then there was the Homestead strike at Carnegie’s steel mill in Pennsylvania—more unionists killed.

How about the practice of blackballing workers if they gave management any grief? It was common practice for owners to put the word out about a worker to other businesses if that worker was deemed a problem or in favor of a union. A blackball meant that a worker would not be hired by other businesses. Indeed, the leader of the Homestead union, nicknamed Lucky by the way, was blackballed and could not find work in this country. He was last seen working in a mine in Mexico.

Closer to home, the accepted narrative is that Henry Ford was a generous man. He wanted his employees to be able to purchase the cars that they were manufacturing. So he started the five dollar day pay rate. Ford deserves his elevated place in history because he was a pioneer in the standardization of parts necessary for mass production. That being said, the five dollar a day came about, not because Ford cared about his employees, but because the annual employee turnover rate was 309%. Work conditions were so bad in Ford’s factory that nobody would stick around. Ford had to replace his entire workforce three times a year. He had to pay five dollars a day to keep the workforce in his shop. Even then Ford’s Sociology Department could enter your home for inspection. If your lifestyle dissatisfied Ford, you did not get five dollars a day.

Let’s touch briefly on the law and government, starting with the Clayton and Sherman Anti-Trust laws. Inspired by the great trust-buster Teddy Roosevelt, those laws were clearly intended to hinder a monopoly condition by business interests, Unfortunately President Grover Cleveland and his Attorney General, Richard Olney, thought differently. When union members went on strike during Cleveland’s administration, they turned the Clayton and Sherman laws on their respective heads, claiming that unions, as monopoly’s, were in restraint of trade, Clearly, that was not the intent of the legislature that created Clayton and Sherman. That’s just one of a ton of examples.

More recently, the Republican legislature and Governor in Michigan passed an anti-union Right to Work bill. Then they attached a financial appropriation to the bill, in affect disallowing Michigan citizens from putting the issue on the ballot through a referendum procedure,

From the Republican’s point of view, that’s probably a good thing as a recent poll shows 64% of Americans favoring unions.

>>> never a great basis for its existence? Aside from the people of color among us, I doubt that any group in this country has so been so hammered and consistently beaten down as America’s workforce. Let’s not forget that today the top 1% are in possession of 40% of the country’s total wealth while wages have been stagnant for forty years. The CEO of Disney makes 1100 times what the average worker makes. If I have read Adam Smith correctly, there is no economic theory that justifies either being the case. Let’s also not forget that our current President has put a corporate lawyer that has spent a lifetime litigating against unions and employees generally at the head of the federal Department of Labor.

Those among us that have grabbed a cup of coffee and a piece of toast on the way to work as employees have earned a special day and much more respect than Matt is able to give us.

I know. I walked on a picket line with one of the brightest, most imaginative, man this country has ever produced — ‘Walter Reuther.'”

Al Churchill’s Comment

Bridge Magazine, “Labor Day has lost some luster, as partisanship pulls us apart,” Phil Power, August 30, 2019

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On Appeasement

On Appeasement

Sometimes on Sundays I leave the dreary world of economics behind and write of broader things.

Since most tomes covering American history have an underlying sunny optimism that is nowhere appropriate for our times, recently I’ve been reading more world history having to do with the rise of fascism or fall of democracy. Several of those books have been disappointing: they are thorough blow by blow descriptions, without organizing the material enough – or simply not including any material – to make a judgment about the underlying dynamics.

On such book is Tim Bouverie’s “Appeasement,” which as is obvious from the title, chronicle’s the UK’s, and in particular Neville Chamberlain’s, policies towards the rise of Hitler Germany in the 1930s.

There are three important issues with regard to the policy of Appeasement:

1. Was it at any point appropriate? (a question I never would have even included before reading this book)
2. Was it, at least temporarily, a necessary evil?
3. Did Chamberlain use it to “buy time” for the UK to re-arm in order to fight a war with Germany?

Only the second question gets an adequate answer from Bouverie’s book.

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