Following Up: Podcast Now On-Line of Last Night’s China Trade Talks Radio Interview

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Following Up, Gordon G. Chang, The John Batchelor Show, Trade, trade talks, trade war, Trump

I’m pleased to announce that the podcast is now on-line of my interview last night on John Batchelor’s nationally syndicated radio show.  Click here for a timely discussion of the fast-moving U.S.-China trade talks with John, co-host Gordon G. Chang, and me.  Special bonus:  The segment spotlights my post yesterday describing evidence in the new Sino-American trade figures of the United States disengaging economically from the PRC – which, as I’ve previously reported, has been ongoing.

And keep checking in with RealityChek for news of upcoming media appearances and other developments.

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Making News: Back on National Radio – as China Trade Talks Near an End?

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China, Gordon G. Chang, Making News, The John Batchelor Show, Trade, trade war, Trump

I’m pleased to announce that tonight I’m scheduled to return to John Batchelor’s nationally syndicated radio show to help provide an update on the fast-moving U.S.-China trade talks – which could be entering their final stages.  Click here to listen live on-line to what’s sure to be a timely segment featuring John, me, and co-host Gordon G. Chang.  Air time:  10:15 PM EST.

And keep checking in with RealityChek for news of upcoming media appearances and other developments.

(What’s Left of) Our Economy: The New Data Contain More Good Trade News for Trump – & the Economy

Tags

China, economic growth, GDP, goods trade deficit, gross domestic product, Made in Washington trade deficit, manufacturing, merchandise trade deficit, non-oil goods trade deficit, Trade, trade deficit, Trump, {What's Left of) Our Economy

The most reasonable conclusion to draw from today’s new U.S. trade figures (which cover February) is that, although evidence keeps growing that President Trump’s trade policies are returning to a success track, even only a fairly clearcut verdict won’t be possible until the March numbers come in.

The reason? By then, we’ll get at least the preliminary official read on the gross domestic product (GDP) for the first quarter of this year, and that will enable some significant light to be shed on a crucial (but almost completely ignored) measure of the Trump trade record – whether on his watch so far, the economy has been able to break or at least change the relationship between the growth of various measures of the trade deficit on the one hand, and overall economic growth on the other.

The answer matters because most economists have long insisted that an expanding economy and an improving trade balance almost never coexist. That claim is belied by the data, but the belief persists.

Further, good growth accompanied by better trade numbers would be of much more than academic interest. For the weaker the relationship between the worsening of the trade deficit and the growth of the economy, the more American growth would be stemming from domestic production, rather than domestic spending and borrowing, and vice versa.

As of the middle of last year, the economy had shown signs of notable progress along these lines. But in the last few months, as serious Trump tariffs on metals and especially on goods from China came on stream, the data started being distorted by front-running – i.e., importers rushing to procure affected goods before the levies kicked in and their prices rose.

Last month’s trade statistics contained important signs that these effects were ebbing, and the trend continued this month.  (A second distortion, however, is influencing these results – the China business slowdown that takes place each year with the arrival of the spring holiday.) All the same, January’s initially reported 14.61 percent monthly drop in the total trade gap (the biggest such decrease since March) was followed by a 3.43 percent decline in February (and from a January level that was revised down slightly). And at $49.38 billion, the overall trade shortfall was the smallest for a single month since last July’s $51.44 billion.

Meanwhile, the total two-month fall-off in the total trade gap (17.56 percent) was the biggest such decrease since March-May, 2015 (20.50 percent). And this is where we come to the main unknown: How do these instances of trade deficit shrinkage compare with the economy’s overall performance? Although Washington doesn’t track GDP on a monthly basis, it’s worth noting that from the second quarter of 2015 to the third quarter (the period roughly corresponding with that earlier trade deficit narrowing, growth on a pre-inflation annualized basis was 1.40 percent.

What about such growth during the first part of this year? That’s the figure we’ll need to wait for until later this month. At the same time, even then, an even more important question will remain unanswered for a while longer: Can the combination of an improved trade performance and continued growth last? In 2015, it was short-lived. Indeed, the current dollar U.S. economic growth rate in full-year, 2016 (2.44 percent) was less than half of the full-year, 2015 pace (5.07 percent). Unfortunately, the durability of this trend won’t be known for many more months at a minimum.

Nonetheless, there’s an even more rigorous test that the Trump trade policies need to pass – whether they can manage to maintain healthy overall economic growth while encourage a reduction in that portion of the U.S. trade deficit that’s strongly influenced by trade policy decisions in the first place. As known by RealityChek regulars, that Made in Washington trade deficit strips out oil (because it’s almost never the subject of trade policymaking) and services (because trade liberalization of that activity remains in its infancy). On this front, signs of Trump trade progress haven’t shown up yet.

From January-February, 2017 (a period during which the Trump presidency began) to January-February, 2018, this Made in Washington deficit rose at the considerable pace of 18.47 percent. On the imperfect first-quarter-to-first-quarter basis, pre-inflation GDP was up 4.58 percent. That ratio was actually worse than during former President Barack Obama’s last year in office. Then, GDP expanded by 4.09 percent but the Made in Washington deficit actually dipped – by 0.50 percent.

As with the overall trade deficit, the Obama years sometimes witnessed strong economic growth during which the Made in Washington trade deficit worsened only moderately. For example, between the first quarters of 2011 and 2012, current dollar GDP improved by 4.80 percent and the Made in Washington trade deficit only widened by 9.80 percent. But growth slowed sharply thereafter. The January-February, 2009 to January-February, 2010 period was another time of Made in Washington trade shortfall shrinkage – by 3.13 percent. But GDP climbed by only a weak 2.27 percent.

Between January-February 2018 and January-February 2019, the Made in Washington deficit was up by a modest 2.48 percent. Can respectable growth be maintained? Tune in.

In the meantime, legitimate encouragement from the February trade figures can be drawn from the nature of the improvement. Sequential combined goods and services import growth was just 0.23 percent, while exports rose 1.13 percent – nearly five times faster.

On month, the Made in Washington deficit shrunk by 1.96 percent. That improvement combined with its 10.01 percent sequential drop in January made for the biggest such two-month decrease (11.86 percent) since that March-May period of 2015 (13.36 percent).

Good news came on the China trade front as well. February saw the biggest month-to-month reduction in the chronic, immense U.S. goods deficit with the People’s Republic (28.17 percent) since February, 2017 (36.04 percent). In addition, the resulting two-month decline in this trade gap (32.77 percent) was the biggest such figure since January-March, 2013 (36.16 percent) and the second biggest going all the way back to October-December, 2001 (39.87 percent).

An 18.21 percent surge in American merchandise exports helped (especially since it followed a 22.31 percent monthly plunge). But the 20.21 percent monthly falloff in the much greater amount of goods imports was the biggest contributor – and represented the biggest such decrease since February, 2017 as well, not to mention the second biggest since recessionary February, 2009 (23.84 percent).

February’s manufacturing trade performance was excellent as well – relatively speaking, of course, since the deficit remains enormous in absolute terms (topping $1 trillion last year).

But industry’s trade gap plummeted by 20.02 percent on month in February, as exports rose 1.85 percent and imports sank by 9.14 percent. And the gap shows signs of stabilizing on a year-on-year basis as well, as it’s up a mere 0.37 percent during the first two months of this year compared with the first two months of 2018.

(What’s Left of) Our Economy: Why Tariffs are Off the Hook for Manufacturing’s Slowdown

Tags

aluminum, China, Federal Reserve, industrial production, inflation-adjusted growth, metals, metals-using industries, real growth, steel, tariffs, Trade, Trump, {What's Left of) Our Economy

Here’s all you need to know to recognize that domestic U.S. manufacturing is experiencing some kind of slowdown: Today’s real output numbers from the Federal Reserve showed that production flat-lined on month in March. And that was a significant improvement from the comparable February figure – a 0.37 percent drop!

So do these dreary results mean that tariff fear-mongers are finally right to claim that President Trump’s levies on imports of steel and aluminum, and on a wide range of goods from China are backfiring on American industry? Not according to the internals.

As has been the case for months, the most convincing evidence comes from the metals-using industries. After all, the tariffs affecting their products have been in place longer. (April was the first full month in which they were in effect.) The most relevant industries are easy to identify. And because (with despite numerous exemptions) the tariffs have been virtually worldwide in scope, there’s no need to wonder whether how extensively the steel and aluminum in question are being supplied by an individual country or even group of countries.

The table below presents the inflation-adjusted output changes in major metals-using industries from April through each of the Fed’s last three data months. This format differs from that used in my previous industrial production-related posts because late last month the Fed released a set of revisions going back to 2015. So rather the old and new figures for the previous data month aren’t comparable anymore, and I simply decided to use the new figures going back three months.

                                            April thru Jan.      April thru Feb.     April thru March

overall manufacturing:      +1.20 percent        +0.83 percent         +0.82 percent

durables manufacturing:   +2.05 percent        +2.05 percent          +1.96 percent

fabricated metals prods:   +3.53 percent        +3.08 percent          +2.85 percent

machinery:                       +4.33 percent         +2.24 percent         +2.71 percent

automotive:                      – 2.84 percent         -0.58 percent          -3.06 percent

major appliances:             -1.83 percent          -1.30 percent         -5.62 percent

aircraft and parts:            +5.45 percent         +6.15 percent         +7.43 percent

An overall manufacturing slowdown is apparent from the February and March columns in the top line. And the second line shows that it’s impacted durable goods to a slightly greater extent – a possible signal of a tariff effect since that’s the super-category in which the main metals-using sectors are located.

But tariff-mageddon claims, as has been the case so far, falter upon looking at the details. First, they’re not very consistent with the volatility much of this data display. (E.g., automotive and appliances.) Second, over the past month, the big machinery sector (which provides equipment serving many different markets) has gained momentum. And aircraft and parts-making just keeps growing faster and faster. (Of course, its performance will likely become a drag on manufacturing output going forward because of Boeing’s 737 Max problems and the damage that will harm not only aircraft production, and possibly the industry’s entire supply chain.)

If tariffs are becoming a challenge for these industries, it’s clear that their impact is being swamped by other influences on their performance – especially the distinctive characteristics and status of their individual markets.

Unfortunately, all of the reasons for considering these metals tariffs-related conclusions compelling cut the opposite way when it comes to evaluating the China levies’ impact. The first full month when the earliest were in place was only August. And identifying industries most plausibly affected is difficult both because the tariff list and the industrial production data use different manufacturing classification schemes, and because of the challenge of figuring out where tariff-ed Chinese products play crucial roles in American industry (in the form of parts, components, materials, and other intermediate goods).

As a result, the bottom line remains that only a handful of manufacturing industries look like strong candidates for producing any kind of a China tariff effect, and most of these suffer from one of the above complications. Sharp-eyed RealityChek regulars will notice that I’ve added oil and gas drilling platform parts to the list:

                                            Aug. thru Jan.       Aug. thru Feb.      Aug. thru March

overall manufacturing:      +0.29 percent         -0.08 percent          -0.09 percent

ball bearings:                     +0.27 percent        +0.19 percent         +0.11 percent

industrial heating equip:     -3.61 percent         -3.39 percent         -5.27 percent

farm machinery & equip:  +2.22 percent       -17.14 percent        -11.65 percent

oil/gas drilling platfm pts: +4.74 percent        +4.59 percent         +4.36 percent

The overall manufacturing slowdown is apparent from these statistics, too. But so is a bewildering range of results, along with a small sample size. Whatever problems American industry might now be facing, the case that tariffs bear much, if any, blame has yet to be supported by these or any other data.

Im-Politic: “Mayor Pete’s” Fuzzy Turnaround Record

Tags

Census Bureau, Democrats, election 2020, Im-Politic, Indiana, Mayor Pete, Mike Pence, Mishawaka, Notre Dame, Pete Buttigieg, South Bend

“Mayor Pete” Buttigieg’s now officially running for the Democratic nomination for President, and before long we’ll see if he can make the transformation from precocious (37-year old) “flavor of the moment” and all-purpose vessel for so many anti-Trump hopes to durable candidate. I’m hesitant to say, because I was among the vast majority of skeptics that Mr. Trump’s own 2016 run had a prayer of success.

What I do feel confident in saying is that anyone will find their work cut out for them if they try (as they should) to assess his record as Mayor of South Bend, Indiana, and especially his claim to have been a “turnaround” expert whose experience qualifies him to steer the American economy effectively.

The first problem they’ll encounter is finding South Bend-specific data during Buttigieg’s tenure (2012-2017). Not that statistics on U.S. cities’ economic performance are the slightest bit scarce. The Census Bureau collects and post oceans of it. But when it comes to South Bend, these figures tend to be lumped in with those for neighboring Mishawaka – which is wealthier. (See here and here for the evidence supporting that assertion and much of the following city-specific numbers.). Indeed, its median household income and property values are significantly higher, and its poverty rate much lower. So it’s tough to find many of these numbers and identify where whatever progress is shown during the whole of the Buttigieg years (and progress is definitely shown on indicators like economic and employment growth, and improvement in income per head) has taken place in which city.

Those that are available, however, aren’t especially flattering to South Bend. For example, between 2013 and 2016, South Bend’s median income advanced by 3.64 percent. Mishawaka’s (higher) median income rose by 4.35 percent. During that time, South Bend’s poverty rate fell by 3.92 percent (to 26.73 percent). But Mishawaka’s plummeted by 19.66 percent (to 17.41 percent).

It’s important to note that these data say nothing about the situation beforehand – so there’s no way to tell whether Buttigieg’s South Bend performed worse still before 2013, and therefore to know about at least some of the context of the 2013-2016 figures. But such numbers can be found for overall population – which matters because Buttigieg has emphasized that South Bend finally arrested a long population decline while he was in charge.

He’s right. From 2012 to 2017, the number of city inhabitants rose by 1.25 percent after decreasing by 3.21 percent during the previous five years. Mishawaka’s population (which is only about half of South Bend’s) loss between 2007 and 2012 was comparable – 3.12 percent. Yet during the 2012-2017 period was a more impressive 2.29 percent.  (See here and here for the data.)

Even accepting as useful the combined South Bend-Mishawaka statistics raises problems, though. Chiefly, it’s tough to find meaningful comparisons that can shed light on the area’s performance versus similar regions throughout the rest of the country. It’s pointless to compare South Bend-Mishawaka’s economic or employment growth with that of U.S. urban areas as a whole (which U.S. Commerce Department figures permit) because the latter is such a diverse group. After all, no one can reasonably hope to learn much meaningful by examining South Bend-Mishawaka side-by-side with New York or Los Angeles.

But the obstacles to finding metropolitan areas similar to South Bend-Mishawaka are formidable because of one of its major features – large and wealthy Notre Dame University. The school is a major contributor to the region’s economy, but the resulting situation is unique in Indiana because it’s a private, not state institution. In fact, it’s hard to come up with any South Bend-sized American cities hosting a single major private university. The only one that’s occurred to me is way out in Washington State, where Spokane (with a population roughly twice as big as South Bend proper) is home to Gonzaga University (whose enrollment is somewhat smaller than Notre Dame’s).

In fact, not only has Notre Dame given Buttigieg a major advantage not enjoyed by many, if any, of his genuine mayor peers. As early as the 1990s, it began to change its practice of standing aside from the city economically and using its resources to promote the economic and specifically technology-oriented business development that’s been a big Buttigieg rhetorical theme. Moreover, the city’s centerpiece economic revitalization project – the $200 million Eddy Street Commons – mainly resulted from a partnership between the university and a realty group.

Further, as is the case with state and local level leaders generally, their control over their jurisdictions’ economies is usually far from absolute – and the more local they are, typically the less control. In this vein, it’s especially interesting that South Bend economic development efforts under Buttigieg were major were major beneficiaries of a municipal grant program put into effect by Vice President Mike Pence when he was Indiana governor. This year, the openly gay Buttigieg has spent considerable time attacking Pence for his allegedly bigoted views about homosexuality.

Perhaps even more important, Buttigieg had the good fortune to enter office in South Bend just as ecovery from the worst national economic slump since the Great Depression was finally gaining some momentum.

Not that Buttigieg doesn’t deserve credit for helping to attract considerable investment to South Bend. Revealingly, among those who make this case most convincingly are Indiana journalists. And at least as revealingly, South Bend voters have emphatically agreed on his effectiveness. Fully 80 percent of them voted to reelect Buttigieg in 2015 – even more than the 74 percent who supported him in his first mayoral run. (See this link for the numbers.) Will voters outside his hometown give this record rave reviews, too? The answer is likely to go far toward determining whether Buttigieg has a prayer of becoming “Nominee Pete,” much less “President Pete.”

Im-Politic: Trump Should Go All-in on Sanctuary Jurisdiction Shaming

Tags

asylum seekers, border security, election 2020, illegal aliens, Im-Politic, Immigration, migrants, Open Borders, Sanctuary Cities, Trump

Anyone doubting the political and moral genius of President Trump’s so-called threat to transport the migrants flooding the U.S. border to sanctuary jurisdictions throughout the country simply lacks a grip on politics and crucial aspects of morals. At the same time, the President has been missing a potentially crucial opportunity to gain the upper hand (both politically and morally) for good on intertwined immigration and border security issues via the sanctuary jurisdiction angle.

The expressed outrage of many sanctuary jurisdiction leaders at Mr. Trump’s proposal to drop the migrants off within their bounds could not be a more classic case of failing to put one’s money where one’s mouth is. Suddenly, cities and counties and states that have been harping for years at how welcoming the United States historically has been and should be, and advertising how welcoming and therefore signaling how virtuous their welcoming policies have been, seem to have decided that their hospitality and generosity are limited after all.

Further, as numerous immigration-realist commentators have noted, after just as many years of portraying sanctuary policies as not only the height of morality but the height of self-interest – because of all the contributions illegal aliens make to their economies and their cultures – the sanctuary leaders and their fellow Open Borders backers in Congress and the Mainstream Media are now singing a different tune. They’re condemning as especially shameful partisanship measures that could greatly increase these populations.

In fact, the Open Borders types’ reactions to this latest Trump position are simply the latest example of one of their defining characteristics. As I’ve been writing, they’ve long been pushing immigration policies that shower them with outsized benefits and display no interest whatever in paying a proportionate share of the costs.

And this observation brings us to where the President needs to administer a genuine coup de grace. Predictably, some of the debate over his statements to date have revolved around supposed legal and policy issues. According to the above-linked Washington Post article, even Mr. Trump’s own Department of Homeland Security argued that his sanctuary jurisdictions plan would violate the law. But in both political and moral terms, such considerations should be completely beside the point – and deserve to be pilloried as either clueless or cynical distractions.

For if the sanctuary and Open Borders enthusiasts are so convinced of the righteousness of their cause, they not only shouldn’t allow such considerations to keep the President from putting this policy into effect – much less retreat behind them. They should be volunteering to get the ball rolling, offering all the resources at their command – and should have been out in front since the unprecedented scale and makeup of recent migrant flows first become clear.  President Trump, for his part, should have been shaming them into action all the while – and shouldn’t wait a minute longer to start turning these tables on them. 

Moreover, even in sanctuary jurisdictions whose leaders are – verbally, anyway – putting their (taxpayers’) money where their mouths are, an intensified Trump strategy will speak volumes about the loonie-ness of indiscriminately indulgent immigration policies.  Efforts to cope with constant streams of low-skilled, poorly educated newcomers should make for an equally constant stream of head-shaking media reports.  Jurisdictions with large numbers of homeless Americans (like those all along the West Coast) would be in for especially, but justifiably, humiliating coverage.

From time to time, the President has depicted Open Borders and sanctuary positions as boons for the nation’s elites at the expense of middle- and lower-income Americans. The uproar over his new sanctuary proposal is a golden opportunity to turn this insight into one of mos consistent themes – and into a thumpingly winning campaign issue in 2020.

(What’s Left of) Our Economy: Real Wages are Still Far from Great Again – Especially in Manufacturing

Tags

election 2020, inflation adjusted wages, manufacturing, private sector, real wages, wages, {What's Left of) Our Economy

No doubt about it – this week’s government report on U.S. real wages was a dog. (No offense to canine lovers – of which I’m one!) And the news, as usually the case, was particularly bad for manufacturing workers, as their inflation-adjusted hourly pay in March dipped back into technical recession territory. That is, their real wages are down on net since January, 2016 – a much longer time-span than the two straight quarters of cumulative growth contraction that comprise most economists’ definition of a recession.

Manufacturing’s real wage recession returned thanks largely to a sizable 0.65 percent sequential drop between February and March. That was the worst such deterioration since November, 2011’s 0.95 percent. The only consolation for manufacturing workers – the decrease followed a 0.56 percent monthly improvement in February. That was the best such performance since August, 2015’s 0.57 percent.

But underscoring manufacturing’s real wage problems was the March year-on-year decline. It was only 0.09 percent. And the rate of decrease was slower than that between the previous Marches – 0.46 percent. All told, however, such price-adjusted hourly compensation in industry is now down by that 0.09 percent figure for more than three years.

Moreover, manufacturing’s real wage performance remains much worse than for the private sector as a whole. (These after-inflation wage analyses omit the numbers for public sector workers’ because their pay largely reflect politicians’ decisions, not the workings of free market forces. In fact, the Bureau of Labor Statistics, which compiles and publishes these figures, doesn’t even track real wages for government employees.)

Private sector workers overall didn’t enjoy a great hourly pay month in March, either. Their constant dollar wages fell sequentially by 0.27 percent – the first such decline since October’s 0.09 percent, and the biggest since February, 2013’s 0.49 percent. Moreover, the private sector’s monthly wage performance can’t be explained by good February numbers – since that month they were only up by a so-so 0.18 percent.

Yet private sector real wages in March were 1.21 percent higher than in the previous March, which continued a solid run for this indicator. And the new March year-on-year figure was considerably better than that between the previous Marches – 0.47 percent.

The manufacturing-private sector real wage comparison looks even worse when their changes during the course of the current recovery are examined. Since mid-2009, after-inflation private sector hourly wages are up 5.72 percent. That’s hardly gangbusters. But it’s a pace more than ten times faster than that for manufacturing – a barely detectable 0.47 percent.

More discouraging for the manufacturing sector: That gap has been widening. From the onset of the current recovery through March, 2018 overall real private sector wages had risen about 7.8 times faster than real manufacturing wages. Through this past March, the exact size of that growth difference was 12.2 times faster.

I’m still convinced that at least some of manufacturing’s relatively bad recent real wage performance (despite strongly growing payrolls) stems from the unusually low quality of workers the sector has needed to attract lately. But as the next presidential election approaches, what I think matters even less than usual, at least politically. The big question is whether the manufacturing workers who turned out for President Trump will be satisfied with this explanation.

(What’s Left of) Our Economy: Signs That No Tariffs-Led Inflation is the New Norm

Tags

aluminum, Bureau of Labor Statistics, China, consumer price inflation, inflation, metals tariffs, steel, tariffs, Trade, {What's Left of) Our Economy

With inflation in the United States still running below the Federal Reserve’s target lately, it’s been difficult enough for tariff fear-mongers to claim that President Trump’s levies on metals and on many Chinese-made goods are setting prices throughout the economy – or even in directly affected sectors – on fire. Yesterday, with a new month’s worth of consumer price data from the Bureau of Labor Statistics, it’s become practically hopeless.

In fact, the big takeaway is that these March data closely resemble February’s. The only significant evidence of steel and aluminum tariffs-led inflation is found in canned fruits and vegetables – where it’s far from airtight – and in large household appliances, which include large laundry machines which have faced their own additional set of tariffs since early 2018. When it comes to products impacted notably by the China tariffs, the price changes are once more all over the board – which strongly indicates that the tariffs themselves haven’t been in the inflation driver’s seat.

As usual, the first table in these monthly consumer inflation analyses presents the price changes for metals-using products. They deserve pride of place for now because they’ve been in effect for more than a year, and because it’s easy to identify metals-using products.

Before zeroing in on the canned stuff, it’s worth mentioning that I found one more data point yesterday morning – inflation numbers for laundry equipment specifically. Some of these products could be the machines used by commercial cleaning operations as opposed to households, but they do sharpen the picture some. In addition, keep in mind that, since so many of the products affected by the metals and China tariffs are food products, the “core inflation” control group figures I’m using measure price changes minus energy – as opposed to the most widely use core data, which strip out both food and energy.

But back to the steel- and aluminum-related figures: Here they are for the February-March, 2019 period (the latest monthly numbers), and for last April to the present (the stretch during which the metals tariffs have been in place), as well as the year-on-year numbers for last April and this March (which provide some indication of trends over time). As usual, the results for tariffs-affected products (e.g., canned foods) are presented along with those of control goods (e.g., non-canned foods) to glean further insights into the tariffs’ effects.

                                 Feb.-March      Since April      y/y April            y/y March

core inflation:        +0.17 percent   +1.93 percent   +2.01 percent   +2.05 percent

fresh fruits             +1.56 percent   +3.55 percent    -0.43 percent   +4.25 percent

& vegs:

fresh fruits:            +1.21 percent   +0.65 percent   +1.38 percent   +1.37 percent

fresh vegetables:    +1.97 percent   +6.98 percent   -2.50 percent   +7.66 percent

processed fruits      +1.57 percent   +1.68 percent   -0.44 percent   +2.72 percent

& vegs:

canned fruits          +1.74 percent    +5.20 percent   -0.14 percent   +6.01 percent

& vegs:

canned fruits:         +3.02 percent    +4.99 percent   -1.60 percent   +8.60 percent

canned vegs:          +1.26 percent    +4.63 percent  +1.00 percent   +5.04 percent

soups:                     -1.33 percent     -0.16 percent    -0.38 percent   +0.54 percent

malt beverages       -0.62 percent    +1.77 percent   +0.84 percent   +1.84 percent

at home:

alcoholic                +0.20 percent    +1.34 percent   +2.17 percent   +1.46 percent

beverages away:

non-frozen, non-    -0.15 percent    +3.30 percent    -0.52 percent    +3.03 percent

-carbonated non-

alcoholic drinks:

carbonated drinks: +0.69 percent    +5.44 percent   +0.04 percent    +5.44 percent

juices & non-         +0.02 percent    +4.17 percent    -0.26 percent    +4.01 percent

alcoholic drinks:

new cars/trucks:    +0.46 percent     +1.13 percent    -1.61 percent    +0.74 percent

motor vehicle        +0.25 percent     +2.08 percent    -0.74 percent    +1.79 percent

parts:

appliances:             -0.76 percent     +2.80 percent   +0.27 percent    +4.83 percent

major appliances:   -2.02 percent     +4.59 percent   +1.55 percent    +8.80 percent

laundry                   -1.02 percent    +0.65 percent  +10.00 percent    +2.80 percent

equipment:

non-electric            -0.76 percent      -0.59 percent    -1.45 percent     -1.56 percent

cookware & tableware:

tools, hardware,     -0.63 percent      +0.86 percent   +0.19 percent    +1.22 percent

outdoor equipment:

The various fruits and vegetables results make a reasonable case that companies in those sectors have been able to pass along some hefty price increases for canned products to consumers. Specifically, except for the April year-on-year changes, all of the figures for canned fruits and canned vegetables show considerably faster price increases than for fresh fruits and vegetables, and even for their processed counterparts (some of which go into frozen or jarred, not canned, products).

It’s true that fresh produce prices as a whole have generally been rising much faster than core prices. But in their canned form, their prices take another big jump up – strongly indicating that something about the canning matters greatly. Moreover, even though the inflation rate in fresh vegetables is leaving in the dust that for fresh fruits, the canning effect is very apparent for fruits as well, especially over time.

It’s also true that the canning effect is much less pronounced for other food groups – like soups and beverages. But here the data is less definitive, largely because these inflation figures also include products sold in forms other than metal cans. And as observed in previous posts, the markets for these products tend to differ significantly as well – which inevitably impacts pricing power.

Yet this March, a generalized “metals-effect” argument once more falls apart upon examining the price trends in non-food products, whether for motor vehicles and their parts; household cookware and tableware; and tools, hardware, and outdoor equipment. Obviously other developments, and perhaps many other developments are playing bigger roles.

The glaring exception is in those double-tariffed laundry machines. Even here, however, that new laundry equipment category I just found reveals major year-on-year price deceleration between last April (ten percent) and this March (2.80 percent). And the March monthly prices were weak across the board in appliances.

The China tariffs continue to present an even more complicated picture for at least three reasons. First, for the following consumer products, last October was the first full month they were in effect. Second, the goods on the U.S. Trade Representative’s list for those levies are categorized using the different classification system than that used by the Bureau of Labor Statistics to gauge prices. As a result, the match-ups are far from exact. And third, the China-specific price effects for different products can be differ dramatically – according to the scale of the Chinese presence in a particular product market.

Nonetheless, here’s the China data for February-March, since last October, and for October and March year-on-year.

                                   Feb.-March         Since Oct.        Oct. y/y           March y/y

core inflation:          +0.17 percent    +0.99 percent   +2.02 percent    +2.05 percent

food:                        +0.28 percent    +1.45 percent   +1.21 percent   +2.12 percent

frozen/freeze-          +1.18 percent     -0.72 percent    -0.46 percent    -0.59 percent

dried prepared  foods:

fish/seafood:             -1.04 percent     +0.79 percent   +2.82 percent  +2.70 percent

processed fish/          -0.51 percent     +0.40 percent   +1.46 percent  +2.76 percent

seafood:

frozen fish/seafood:  -0.46 percent    +0.78 percent    -0.15 percent   +3.29 percent

fruits/vegs:                +1.57 percent    +3.43 percent    -0.32 percent   +3.91 percent

fresh fruits/               +1.56 percent    +3.71 percent    -0.38 percent   +4.25 percent

vegetables:

fresh fruits:               +1.21 percent    +2.51 percent    -1.40 percent   +1.37 percent

fresh vegs:                +1.97 percent    +5.07 percent   +0.81 percent   +7.66 percent

processed                  +1.57 percent    +2.37 percent    -0.06 percent   +2.72 percent

fruits/vegs:

frozen fruits/vegs:    +0.76 percent   +0.25 percent     -2.72 percent   -1.26 percent

non-carbonated/        -0.15 percent   +1.91 percent     +1.23 percent  +3.03 percent

non-frozen juices/drinks:

personal care             -0.27 percent   +0.64 percent     +1.52 percent  +1.25 percent

products:

household                  -0.04 percent   +0.74 percent    +0.69 percent   +1.46 percent

furnishings:

recreation goods:       -0.74 percent   -1.55 percent     -3.51 percent    -7.28 percent

men’s sportswear:      -1.04 percent   -2.54 percent    +1.47 percent   +1.98 percent

women’s                   +2.90 percent   +0.35 percent     -5.08 percent   -1.55 percent

sportswear:

computers,               +0.54 percent    -1.17 percent     -4.09 percent   -3.30 percent

peripherals, etc.:

window/floor           +0.44 percent    -1.96 percent    +0.74 percent   -1.83 percent

coverings:

furniture &              +0.17 percent    +1.38 percent    +1.26 percent   +3.27 percent

bedding:

appliances:               -0.76 percent     -0.58 percent    +4.82 percent   +4.83 percent

major appliances:    -2.02 percent      -0.34 percent   +8.08 percent   +8.80 percent

laundry equipmt:     -1.02 percent     -5.05 percent  +10.00 percent   +8.76 percent

misc appliances:      -0.29 percent     -1.33 percent    +3.25 percent   +2.56 percent

non-electric             -0.76 percent     -0.49 percent     -0.51 percent    -1.56 percent

cookware/tableware

tools/hardware        -0.63 percent    +1.27 percent     +0.39 percent   +1.22 percent

& outdoor equipment:

household               +0.83 percent    +1.24 percent    +1.79 percent    +3.33 percent

cleaning products:

televisions:              -4.20 percent   -10.91 percent   -17.95 percent   -19.28 percent

misc video equip:    -0.03 percent    +4.41 percent     -3.87 percent    +1.79 percent

pets & pet               +0.26 percent    +1.76 percent    +0.91 percent    +2.81 percent

products:

sporting goods:      +1.00 percent    +3.04 percent    +1.71 percent    +0.25 percent

photo equipment     -0.05 percent    -1.29 percent      -4.94 percent    -5.70 percent

& supplies

sewing machines/   +2.51 percent +12.51 percent     -2.08 percent  +10.32 percent

fabrics:

motor vehicle          +0.25 percent   +1.27 percent    +1.25 percent    +1.79 percent

parts:

tires:                        +0.15 percent   +2.28 percent    +0.03 percent    +1.08 percent

stationery/               +0.28 percent   +4.53 percent     -6.48 percent     -0.01 percent

gift wrap:

Even in sectors with a prominent Chinese presence, like apparel of consumer electronics, any kind of price-hiking tariff effect is elusive, at very best. In fact, in virtually all the products below, inflation has been decidedly weaker than in the core control group, and deflation is apparent in many.

Comparing the two year-on-year figures does reveal some accelerating inflation (or weakening deflation). This is especially clear in the food-related categories (including the broad food control group) and in some non-food segments (like household furnishings, men’s and women’s sportswear, computers and peripherals, furniture and bedding, stationery, sewing machines and fabrics). But softening prices can be seen in recreational goods, sporting goods, personal care products, window and floor coverings, televisions, miscellaneous appliances, and several others.

Since these tariffs-related price data began coming in, I’ve been saying that although inflationary effects haven’t yet shown up, they could always appear in the coming months. Roughly a year after the metals tariffs have been in place, it’s now time to start suggesting that the no tariff-led inflation situation is becoming the New Norm.

Im-Politic: Biden’s Real Problem(s) with Women

Tags

feminism, First Amendment, free expression, gender, hate speech, Im-Politic, Joe Biden, Me Too, New Puritans, personal space, privacy, sexism, sexual assault

As long as Joe Biden remains in the potential or actual 2020 presidential election game, Americans will be debating the propriety of his longstanding touchy-feely style of dealing with women in particular, and how best to respond to these and similar situations and charges. As usual, opinion (at least as expressed in the often hysteria-prone national media) seems polarized between extremes, and as usual, genuine wisdom resides somewhere in the middle.

The best way to arrive at sensible conclusions – i.e., those that permit us to continue functioning as human beings with legitimately differing personalities while respecting the equally legitimate sensitivities and indeed fears of others – seems to be to unpack the several overlapping issues involved, at least in part (because there are good reasons for much of the overlap).

Even the women who have complained about Biden state that his behavior wasn’t sexually motivated, which is definitely a big point in the former Vice President’s favor. Even so, he deserves reprimands on many grounds. First, Biden’s claim, in his first extensive (video) response, that in the wake of the Me Too revelations and movement, the rules regarding personal space have changed, is simply too convenient. So are defenses of Biden claiming that his critics seek to criminalize even normal, often desirable displays of affection, or endorsing his insistence that he’s simply been slow to adjust to changing times.

The “Biden-ists” have a point when the individuals involved who are well acquainted, either as friends or as relatives. In such instances, spontaneous, light physical contact can be perfectly fine – and indeed a necessary form of human bonding. But in these Biden cases, these kinds of relationships didn’t exist. And when that’s the case, the default position should rule out touching unless it’s expressly welcomed.

Moreover, what’s the evidence that intense physical contact among strangers has been the norm in American history before the so-called New Puritans of the Left emerged? For what it’s worth, as long as I can remember, public schools have taught even their youngest students to refrain from touching their peers without some clear sign of permission or encouragement, or aside from contact sports and games. And I’ve never met a parent who has told his or her child that physical contact outside of boisterous play is just fine once the other child protests.

At the same time, the incidence of sexual abuse among relatives makes clear that the mere existence of a relationship can’t seen as license to caress away. Which brings up a second problem with Biden’s actions and his subsequent defenses – and a second reason for entering any social situation with a hands-off mindset. When it comes to physical contact, the object individual’s feelings must be paramount. And mature adults in particular should be actively trying to anticipate them before plunging in. That’s why the idea of personal spheres or zones of privacy have always been so valued, especially in cultures and societies that prioritize protecting individual rights. The very idea of privacy logically assumes that the “contact-ee” is entitled to absolute control over entry into that zone, and that the “contact-er” needs to recognize this form of sovereignty and avoid taking genuine initiative.

As a result, Biden’s suggestion that he should be absolved because his intentions were innocent (which, to be fair, was followed by an admission of the importance of getting up to date) is thoroughly inadequate. He should have been continually aware that, in cases of women he didn’t know, or didn’t know well, it never should have been “all about him.” The women’s potential feelings should have ranked much higher on his scale of concerns – and the more so since Biden’s strongly feminist policy record, including an active role in pushing zero-tolerance-type policies on college campuses, indicate that he’s thought a great deal about such matters.

Even weirder is Biden’s apparent cluelessness about the power issues raised by his actions. After all, the Me Too Era has rightly and finally shone a blazing light on how common it’s been for men to exploit their professional and other business positions for sexual ends. It should be equally clear, therefore that women have long lived with justifiable fears about such exploitation. So even if he was unaware of such context in the episode involving New Mexico politician Lucy Flores, it should be plain as day to him now how uncomfortable and even afraid his (unsolicited) kissing and nuzzling, however gentle and innocently aimed, would likely make her given his role near the top of a political party in which she obviously hoped to succeed. At the very least, in this context, his behavior can’t help but convey a sense of entitlement.   

Moreover, the long-time and often continuing subordination of women in America, and the fact that such invasions of privacy are so common and therefore until recently have attracted so little attention means that “Believe women” is a justifiable guideline. As I wrote in connection with the battle over confirming Brett Kavanaugh to the Supreme Court, that’s why the law recognizes that numerous similar considerations warrant exceptions to the presumption of innocence in criminal sexual abuse cases.

Finally, Biden deserves some shots on the Me Too et al score both for never having apologized for his behavior (as opposed to saying he “felt badly” for any discomfort he caused) and then for making light of his accusers and their allegations.

At the same time, let’s not suppose that the object’s feelings also necessarily override all else when the offenses are verbal. Constitutionally, of course, laws and even norms against abusive speech run into strong First Amendment protections. No unwanted physical contact of any kind enjoys such status. Moreover, it’s easy to identify unwanted contact. It either has or hasn’t taken place. (Yes, “in your face-type” approaches are less clearcut.) Bright lines separating acceptable from allegedly unacceptable speech are much harder to find (though not impossible, since free expression is not an absolute right under long prevailing interpretations of the Constitution). Consequently, it’s much easier to abuse even the best-intentioned efforts to curb or ban hurtful speech.

This latter complication, in turn, influences the so-called “snowflake” factor. Specifically, the centuries-long determination of American society to permit even the most hateful speech in most circumstances seems to reflect a belief that in a free society, a high degree of verbal rough-and-tumble is necessary and even often desirable. In addition, psychologically, it’s reasonable to assume that leading a healthy, well-adjusted life entails some ability to roll with most such verbal punches as well. I’m aware of no comparable conviction that a free society requires a high degree – or any degree – or unwanted physical rough-and-tumble, much less that such behavior produces any positive results. And show me the mental health professional who believes that emotional well-being and normality entail sloughing off lots of groping.

The bottom line? There’s no valid reason to stamp Biden as a sexual predator or even a sexist. There’s every reason to view him as an exemplar of terrible judgment and (stubbornly) gross insensitivity on this cluster of gender issues. As a result, Democrats and others who keep seeking better from him are anything but New Puritans. They’re folks who’d like to to see their political leaders display some genuine ability to learn.

Im-Politic: The Washington Post’s Nazi-Baiting on Trump & Immigration

Tags

Adolf Hitler, asylum seekers, border security, Central America, Franklin D. Roosevelt, Im-Politic, Immigration, Isaac Stanley-Becker, Mainstream Media, migrants, Nazism, Open Borders, refugees, Trump, Trump Derangement Syndrome, Washington Post

Just when I think that I couldn’t become angrier at the bile spewed by some of President Trump’s critics and too often reported as fact or respectable, newsworthy opinion by the Mainstream Media, Trump Derangement Syndrome sufferers keep topping themselves. And this morning I saw a series of such statements so inexcusable that I’ve decided to post about them even though I’ve already expressed my views in a tweet.

The accusations came in a Washington Post article today titled “’Our country is FULL!’: Trump’s declaration carries far-right echoes that go back to the Nazi era.”

Reporter Isaac Stanley-Becker was referring to the remarks made by Mr. Trump last Friday during his visit to the U.S.-Mexico border, where even champions of what I’ve come to call the Functional Equivalent of Open Borders are now finally admitting that flows of migrants mainly from Central America are overwhelming federal government facilities set up to deal with foreigners seeking to cross into the United States.

Stanley-Becker, who is based in London, wasn’t simply content to observe that the President’s language “fits a pattern of far-right rhetoric reemerging globally. Fear of an immigrant takeover motivates fascist activity in Europe, where, historically, the specter of overcrowding has been used to justify ethnic cleansing.”

With the evident endorsement of his editors, he went on to write that “Adolf Hitler promised ‘living space’ for Germans as the basis of an expansionist project….”

In this vein, he sought to legitimize this analysis by quoting an historian (from the University of California at Berkeley) who contended “The echoes do indeed remind one of the Nazi period, unfortunately. The exact phrasing may be different, but the spirit is very similar. The concern about an ethnic, national people not having proper space — this is something you could definitely describe as parallel to the 1930s.”

In addition, Stanley-Becker reported that “The president’s words became even more freighted when he repeated them on Saturday before the Republican Jewish Coalition in Las Vegas, saying, ‘Our country is full, can’t come. I’m sorry.’” (Which sounds like an opinion, not the kind of fact that news reporters are supposed to present in their own voice.) And he supposedly documented the follow-on statement that Mr. Trump’s remarks “drew outrage” by citing precisely one tweeter and Democratic presidential candidate Beto O’Rourke.

The author was clever enough to slip into his story the kind of qualifier meant to convey objectivity but skated over far too quickly to alert most readers to their potential to invalidate the entire exercise. For example, Stanley-Becker briefly noted that “Hitler promised ‘living space’ for Germans as the basis of an expansionist project, which historians said distinguishes the Third Reich from today’s xenophobic governments.”

But in case you’re tempted to conclude “That distinction seems pretty darned important,” the author hastily added, in a classic example of insinuation, “Still, experts found parallels” (by which he meant the aforementioned Berkeley professor).

Moreover, let’s not forget the towering double standard Stanley-Becker and similar Trump haters have created. For if the President’s words and (prospective) actions “echo” and “remind” of Nazism, what should be made of former President Franklin D. Roosevelt – under whose administration refugees from the Third Reich itself were turned away from American shores? Does this record reveal racist, anti-semitic, xenophobic Nazi sympathies? Or “echo” them etc.? In fact, Roosevelt’s name isn’t even mentioned in the article, even though he received cables from the ship on which they traveled begging for admission.

Does Roosevelt deserve such descriptions – and condemnation?  If not, why not?And to return to current circumstances, President Trump has clearly been reacting against the large numbers of U.S.-bound migrants falsely seeking asylum (which is awarded to those fleeing persecution) who are seeking better material lives. Roosevelt was denying entry to individuals and families clearly seeking to escape a regime that was obviously targeting them because of their identity.

Because this is a free country, Stanley-Becker, his editors, and his publisher have every right to accuse President Trump of using coded, pro-Nazi or Nazi-sympathizing dog-whistle attacks to advance his immigration policies. But their profession’s ethics prohibit them from portraying these views as unvarnished facts in news columns. And common decency demands they have the courage to make these charges openly, rather than using the weasel words and phrases and similar ploys so typical of character assassination.