douglass carmichael: economics

Tue, 21 Sep 2004 17:48:55 GMT

US population growing at 3.2 million per year.

(http://www.npg.org/popfacts.htm

and we have http://biz.yahoo.com/ap/040921/economy_6.html

Housing Construction Highest in 5 Months
Tuesday September 21, 10:50 am ET
By Jeannine Aversa, Associated Press Writer

Housing Construction Climbs in August to Highest Level Since March, a Sign of Economic Expansion

WASHINGTON (AP) -- Housing construction in August surged to its highest level in five months, a dose of encouraging news for the economy's expansion.

The number of housing projects launched by builders clocked in at a seasonally adjusted annual rate of 2 million units, a 0.6 percent increase from July's level, the Commerce Department reported Tuesday.

That means about one new house for every new 1.6 people. That is, we are keeping up.

Builders in the Northeast broke ground on 196,000 units, on an annualized basis, last month, a 6.5 percent increase from July's level. In the Midwest, housing construction rose by 4.8 percent to a rate of 370,000. In the South, housing starts went up by 1 percent to a pace of 907,000. But in the West, housing construction dropped by 4.7 percent to a pace of 527,000.

Tue, 31 Aug 2004 15:36:24 GMT

History moves in a muddy way. Just as something seems clear, most people are reacting in ways that are contrary to the major trend. Its a bit like a river overflowing its banks and seeking many little new ways to get on. The result is muddied and indefinite. For example, this action will make a difference, contrary to major trends.

from http://www.washingtonpost.com/ac2/wp-dyn/A47284-2004Aug30?language=printer

Saudis Fight Militancy With Jobs

Private Posts Formerly Held by Foreigners Are Offered to Locals

By Scott Wilson

Washington Post Foreign Service
Tuesday, August 31, 2004; Page A01

RIYADH, Saudi Arabia, Aug. 30 -- The government of Saudi Arabia is drawing on a multibillion-dollar oil windfall to place hundreds of thousands of young Saudis in jobs traditionally held by foreigners, betting that greater economic opportunities in the kingdom will counter the rising Islamic militancy challenging the royal family.

Millions of dollars are flowing into job-training, technical schools and cash incentives for Saudi companies to hire local citizens. In a process known as "Saudization," some of the foreigners who have long been the backbone of the kingdom's private-sector labor force are returning home.

Fahad Amri, a 34-year-old Saudi, greets shoppers at the new Azizia Mall. Such service jobs have traditionally been held by foreign workers. (Scott Wilson -- The Washington Post)

The new approach was on display this week at the grand opening of the Azizia Mall in downtown Riyadh, where Saudi men in head scarves and black-cloaked women were strolling along cool marble aisles, holding cups from Seattle's Best Coffee and wandering past a McDonald's, sporting goods stores and boutiques.

Mon, 30 Aug 2004 20:29:58 GMT

a point of view

Change, real median household income (2003 adjusted dollars)

Bush II: -$1,535
Clinton: +$5,489
Bush I: -$1,314

Change, number in poverty

Bush II: +4,280,000
Clinton: -6,433,000
Bush I: +6,269,000

Thu, 26 Aug 2004 17:54:01 GMT

Update on Census economic report, full report at

http://www.census.gov/prod/2004pubs/p60-226.pdf

So far it looks like they use mostly median values.

Thu, 26 Aug 2004 15:43:40 GMT

So much happening. I find interset and drama in very local politics: what;s happening in your town? Take the time to get to know the council, mayor, developers, editors. It makes life more realizeable, and, you can see how larger issues affect local choices and thinking.

But meanwhile, http://money.cnn.com/2004/08/26/news/economy/poverty.reut/

Survey: More Americans in poverty

Census Bureau report says 1.3 million slipped below benchmark; health care coverage also declines.
August 26, 2004: 10:28 AM EDT

WASHINGTON (Reuters) - Some 1.3 million Americans slid into poverty in 2003 despite the economic recovery, and children and blacks were worse off than most, the government said Thursday in a report certain to fuel Democratic criticism of President Bush.

The percentage of the U.S. population living in poverty rose to 12.5 percent from 12.1 percent in 2002, the Census Bureau said in its annual poverty report, seen by some as the most important score card on the nation's economy and Bush's first term in office. The ranks of the poor rose to 35.9 million, a boost of 1.3 million.

Health care coverage also dropped last year and incomes were essentially stagnant, the Census Bureau said in its annual poverty report, seen by some as the most important score card on the nation's economy and Bush's first term in office.

It will be important to take these numbers apart. For example, when it saya income is stagnanat, if that is an average, it may mean that upper went up, and lower went down. The question is, where is the tipping point. If the top 1% goes up 1% that may mean the bottom ten percent or more going down 1%.

"on average, humans are all dead."

Tue, 24 Aug 2004 04:59:06 GMT

Highly recommend this unusual article. on the nature of a negaqtive economy, that is, the US now.

http://www.sandersresearch.com/Sanders/NewsManager/ShowNewsGen.aspx?NewsID=667

Thu, 12 Aug 2004 00:36:45 GMT

Good article on the passing of rsik from corporatrions to individuals - that is, workers.

http://www.tnr.com/doc.mhtml?i=20040816&;s=hacker081604

udged on this basis, what my evidence shows is deeply troubling. When I started out, I expected to see a rise in the instability of family income. But nothing prepared me for the sheer magnitude of the increase. At its peak in the mid-'90s, income instability was almost five times as great as it was in the early '70s, and, although it dropped somewhat during the late '90s (my data end in 1999), it has never fallen below twice its starting level. By comparison, permanent income differences across families have risen by a more modest, if still troubling, 50 percent over the same period.

The full explanation for this dramatic rise in instability is still unclear, but two causes loom large. The first, and most obvious, is changes in the nature of work. In today's postindustrial economy, less skilled workers are much more vulnerable than when unionized, manufacturing labor was more of the norm. (Not surprisingly, instability is greater for families headed by less educated workers, though it has actually risen more quickly in the last decade for workers who went to college.) Workplace benefits, such as health insurance and pensions, have been on the chopping block. And corporate America increasingly relies on part-time, contingent, and contract workers--all of whom enjoy precious little security.

Mon, 09 Aug 2004 20:12:58 GMT

A week away, and what has happened is a perceived increase in the amount of tension, economic and international, social and personal.

From http://www.dailyreckoning.com/

This first slide is a graph of national debt. Notice how total national debt continues to climb at its eerie linear rate, namely $52 billion per month. Look at that number again. That's right; look at it - look at the number $52 billion! A month! Make sure the number is burned into your brain, because years from now your grandchildren are going to be sitting in the dirt playing with rat bones and dried doggy-doo, the only kind of toys you can afford to give them, and they will be asking you, "How much money were you guys spending, anyway, that has caused us to suffer such misery?"

To put it in perspective, it's $372 in extra debt, PER MONTH, for everybody who has a job in this whole country, INCLUDING government workers! And next month it is going to be ANOTHER $372! And then another and another and another!

Month after month, year after year, the government is putting you farther and farther into debt. And this does not even include the debt that you voluntarily take on, so that you can have those matching Jet Skis.

In the last, short 25 months, we bozo Americans have accumulated, in spooky straight-line fashion, another $1.3 trillion in new federal debt. Even if all of this money was loaned out at a lousy 2%, then the interest expense alone, which is one of those federal budget line items, is rising by $26 billion a year! At 3%, it's another $39 billion! At 4%, $52 billion! At 6%, which is closer to where short-term rates should be given the current inflation rate, we will be paying $78 billion a year in extra interest costs on the debt! That's $557 for everybody who has a job in America!

Where does this money go? Who is going to end up with $26 billion a year?

It's obvious... to the guys who had money to start with, and who loaned it to the government! And who are these guys?

Well, it ain't the poor, who don't have any money to lend, and it ain't the Mogambo, who was trying to borrow money from the poor, and we all know how well that worked out.

So, once again, the rich get richer and the poor get poorer.

And how did the poor get poorer? Well, the Bush people just put a nice big tariff on imported shrimp, and now the price of shrimp is going to go up. So the poor are going to pay for this by suffering a decline in their standard of living, which translates into their not being able to afford to eat shrimp anymore.

Sun, 25 Jul 2004 18:36:36 GMT

We are seeing increasing use of the internet to lay out maps of influence.

For example http://www.exxonsecrets.org/

Thu, 22 Jul 2004 16:39:52 GMT

I think we might all agree that a middle path, keeping business but asking for state charters that impose some conditions, and an international agreement that quality of life for all, not just a few. is better, more secure, and that education is vitally important, not just for economics, but for citizenship and the benefits of a good private, communal, and artistic life.

If we combined that with the view that tech and capital can go together to meet tough environmental standards (for land, workers and consumers)and law supports small and regional business and is not aimed (as most regulation) as supporting the large system businesses, we might get somewhere
A commitment to values - life, liberty, and the pursuit of happiness - is pretty good.

I ask this question - is business
1. a right given that some who can take advantage can get private wealth
2. the way society meets human needs and creates incomes for most?

it is striking how deep the logic of #1 has taken over.

Business must be seen as a societal strategy, not merely an individual right.

And each of us need to work on perfecting the quality of our own life, and helping others do the same.

It is the failure of the US to live its own identity that creates such hatred - nothing like a failed exemplar to stimulate resentment.

Wed, 21 Jul 2004 16:32:06 GMT

An excellent review of the state of the economy.

http://billmon.org/mt/mt-tb.cgi/1585

Sat, 12 Jun 2004 13:38:27 GMT

Yes, but..

WASHINGTON -- While many U.S. workers fear the prospect of seeing their jobs shipped overseas, a new government report indicates few layoffs can be blamed directly on work being sent abroad. In the first three months of the year, the jobs of 4,633 U.S. workers were sent to foreign workers, according to a Labour Department report released Thursday.

It is the relentless pressure on salaries. Of course if jobs tend to go overseas, the reaction is to lower wage rates so they do not. Thus the overall loss of income is much higher than the loss of jobs.

Wed, 09 Jun 2004 03:49:40 GMT

This goes to the core. As I've been writing, pakistan and nuclear weapons are key. I had not gone so far as to see that oil and nuclear weapons *are the prize*!

http://bopnews.com/ for june 8

Kerry will inherit a host of problems that if not dealt with effectively could either destroy or cripple America. The most obvious is what we call terrorism, but which is more than that – a giant game of Empire with oil and nuclear weapons as the prizes. From Afghanistan to Morocco, but centering in Pakistan and Saudi Arabia (not in Iraq or Afghanistan) this game will determine who controls the most important resource in the world. Oil. And the US isn’t winning this war, it’s losing it. Saudi Arabia is increasingly unstable; it’s armed forces are unreliable; it’s strongest allies are ideologically wedded to the House of Saud’s greatest enemy and it’s greatest resource (oil) is exposed to strikes whenever it’s opponents choose.

Mon, 07 Jun 2004 18:50:53 GMT

Diet presasures, not unlike energy pressures. This from Mexico in the period about 1100 AD.

http://antiquity.ac.uk/ProjGall/leach/index.html

The addition of more costly under-used foods - that require prolonged cooking in cook stone earth ovens - to the diet during the Classic Mimbres period is a variable of increasing diet breadth not well understood. As an element of land-use intensification, the presence of large, cook stone earth ovens marks a new avenue of subsistence and residential mobility research for the region. Further survey and subsequent excavation will provide important data for developing models (see Thoms 2003) of the spatio-temporal distribution of these cooking facilities and the evolving role of cook-stone technology and overall developmental trends in cooking techniques during the Holocene.

How could a society under pressure refrain from expaning the spectrum of foods, which in turn requires more energy (longer cooking) which further denudes the landsacpe?

Thu, 03 Jun 2004 00:16:00 GMT

Overheard

- In Florida, construction projects have been put on hold,

contractors are panicking and cement is nowhere to be found. It's all being sucked up by China. The reason is simple: An economy the size of France or Italy is growing at rates usually reserved for small island economies; China grew at a 9.8% annual growth rate in the first three months of the year.

- China has 4,813 cement plants, more than the rest of the world combined, and they still don't have enough. Projects like the Three Gorges Dam and Beijing Olympics forced China to gobble up 55% of the world's supply of cement, 40% of its steel, and 25% of its aluminum. Yesterday we learned that, in Shanghai, real estate prices rose by 28.3% in the first quarter, according to the Detroit Free Press, causing the local bureaucrats to ban developers from selling apartments before they have been built... these are more than mere details for our Pao Mo file... they're affecting markets all over the world.

http://www.dailyreckoning.com/whitelist.cfm

Wed, 26 May 2004 15:59:37 GMT

A good graph on job creation. It actually looks good, but it does not correct for the increased size of the population, so the right side needs to be taken down a bit. Looking at the details is important. If the numbers stay high it should affect the political climate. But then we need to look at income and productivity. The main pages contain lots of information.

http://data.bls.gov/servlet/SurveyOutputServlet?data_tool=latest_numbers&;series_id=CES0000000001&output_view=net_1mth

One issue: is there any political pressure that distorts these figures?

Mon, 24 May 2004 21:05:32 GMT

History changes by one side getting ahead of the other side's position. Nixon going to China would be an example. Her is a surprise.

James Lovelock: Nuclear power is the only green solution

We have no time to experiment with visionary energy sources; civilization is in imminent danger

24 May 2004
http://argument.independent.co.uk/commentators/story.jsp?story=524230

Sir David King, the Government's chief scientist, was far-sighted to say that global warming is a more serious threat than terrorism. He may even have underestimated, because, since he spoke, new evidence of climate change suggests it could be even more serious, and the greatest danger that civilization has faced so far.

The basing of society on nuclear power probably requires a security centered state. That helps the move toward a soft - or hard - fascist solution. I deeply worry about this argument. It may even be "true." But we need to really think through the potential consequences. Of course this is why his statement is news. People are sensitive to these contradictions and implications.

Tue, 18 May 2004 17:00:05 GMT

Its hard to be president

http://www.nytimes.com/2004/05/18/business/18reserve.html

A photo from his talk at Timken leads the White House Web site's "Building America's Economy Photo Essay." It shows Bush standing in front of a glorious red, white and blue "Jobs and Growth" banner.

As he said at the time, the "greatest strength of the American economy is found right here, right in this room, found in the pride and skill of the American work force."

Last week, Timken announced that the folks right there in that room are getting fired. Timken, the world's largest industrial bearings maker, whose chairman is a major donor and fundraiser for the Republican Party, plans to shut down three factories in Canton and eliminate 1,300 jobs.

But a lot harder when you are wrong and should know it. Wrong here means an accurate read of the economy s being on a slope, not in a wave.

Sun, 16 May 2004 04:02:52 GMT

from Eliot's Middlemarch, the character of a person who sees himself not good at capital management..

His classification of human employments was rather crude, and, like the categories of more celebrated men, would not be acceptable in these advanced times. He divided them into " business, politics, preaching, learning, and amusement." He had nothing to say against the last four; but he regarded them as a reverential pagan regarded other gods than his own. In the same way, he thought very well of all ranks, but he would not himself have liked to be of any rank in which he had not such close contact with " business " as to get often honorably decorated with marks of dust and mortar, the damp of the engine, or the sweet soil of the woods and fields. Though he had never regarded himself as other than an orthodox accept any number of systems, like any number of firmaments, if they did not obviously interfere with the best land-drainage, solid building, correct measuring, and judicious boring (for coal). In fact, he had a reverential soul with a strong practical intelligence. But he could not manage finance: he knew values well, but he had no keenness of imagination for monetary results in the shape of profit and loss: and having ascertained this to his cost, he determined to give up all forms of his beloved " business " which required that talent. He gave himself up entirely to the many kinds of work which he could do without handling capital, and was one of those precious men within his own district whom everybody would choose to work for them, because he did his work well, charged very little, and often declined to charge at all. It is no wonder, then, that the Garths were poor, and "lived in a small way." However, they did not mind it.

Fri, 14 May 2004 00:09:02 GMT

Bell-weather important, a new Gandhi

http://www.opinion.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2004/05/14/dl1401.xml&;sSheet=/opinion/2004/05/14/ixopinion.html

India Shining" shed its rays only on that sector of the population that was epitomised for the West by software outsourcing and call centres in states such as Karnataka and Andra Pradesh. For the nearly two thirds of Indians who live off the land, among whom Mrs Gandhi campaigned vigorously, little had changed under BJP rule. Their prime requirements are running water, electricity and jobs. Lacking those, they used their votes to remind New Delhi and the wider world that development in their country, as in that other Asian giant, China, is very uneven. A foretaste of what was to come when the general election results were announced yesterday came on Tuesday in the defeat of Chandrababu Naidu, a BJP ally, in a state poll. As a chief minister of Andhra Pradesh who attracted substantial foreign investment in information technology, he was the very essence of "India Shining". But at the same time his state stood out for its high level of farmer suicides.

Thu, 13 May 2004 18:06:43 GMT

On jobs.

Where the Jobs Are

http://www.nytimes.com/2004/05/13/opinion/13COXX.html

Over the past decade the biggest employment gains came in occupations that rely on people skills and emotional intelligence — like nurse and lawyer — and among jobs that require imagination and creativity: designer, architect and photographer. But not all of the new jobs require advanced degrees or exceptional artistic talent; note the rise of employment for hair stylists and cosmetologists.

Trying to preserve existing jobs will prove futile — trade and technology will transform the economy whether we like it not. Americans will be better off if they strive to move up the hierarchy of human talents. That's where our future lies.

The problem is, most of the more humane jobs pay less, always have. Can that be reversed? Can being a teacher, mother, architect doctor, lead to a reasonable salary without the support of regulation that creates distorting careers - such as for layers and docs? It would be a good direction to go, but our education is still trying to produce technocrats and regimentable inarticulate workers.

Tue, 11 May 2004 18:31:31 GMT

Employment - the new jobs are being created by foreign companies finding that production in the US for consumption here is cheaper, and wage regulations are easier than in many foreign countries.

Acccording to American Enterprise Institute on c-span panel

Mon, 10 May 2004 23:45:26 GMT

Economic reporting is such a mind maze. This from

Gas Prices

Drivers Tend to Shrug Off High Gas Prices, for Now
Neela Banerjee
New York Times, May 4, 2004, Page C1

.... In the late nineties, wages were rising by approximately 2 percentage points more than inflation, each year...

But note that is aveage wages, which include the faster rising wages at the top and the broadly lowering wages from about (hinting I am not sure where this break point is, and may be higher) 60% down. hence wages were only higher than or equal to inflation for a minority of workers.

Thu, 06 May 2004 03:43:48 GMT

And

Andreas's little book:

Addicted to War by Joel Andreas.

The cost: "In other words, the government has spent more on the military over the last four decades than the value of all the factories, machinery, roads, bridges, water and sewage systems, airports, railroads, power plants, office buildings, shopping centers, schools, hospitals, hotels, houses, etc, in this country put together!"

Thu, 06 May 2004 00:38:45 GMT

Here is an important piece of logic. (the numbers are not precise, but you get the sense).

The median income has increased 20% in real dollars since 1990.

The income of the top one percent has gone up 500% in this period.

The cost of a house has gone up 300%.

Note that means that for the median family the cost of the house is up, or 15 times as much as their income has gone up. But for the top 1% the cost of a house has fallen almost in half!!