Unfair deficits

Long before Trump entered politics he complained about the trade deficits that adversely affected the US. To understand the impact of trade compare Germany with the US. While the US has $600 billion dollar trade deficit, Germany has a $250 billion dollar trade surplus and consider that the US has four times the population of Germany this difference is astounding. While the US runs a trillion dollar budget deficit, Germany has a budget surplus. This means the German national debt is 50% of GDP while the US is over 100% of GDP. The interest on debt is a drain on the economy and hurts the US. When Germany sells to the US there is very little import tax but when the US sells to Germany there is a large import tax. This has been going on for many years. In addition Germany spends very little on defense since they depend on the US to cover them. They don't pay their fair share to NATO and to the UN while the US pays more than a fair share.

Growth and pollution

One of the many controversies in today's world is the argument over nationalism vs globalism. There is only an argument, because certain groups see this as either or. Both of these ideas have their strong points and their weak points. The solution should be to accept the best parts of each. We can all benefit from free trade if governments do not put their finger on the scale by subsidizing certain industries. We can increase productivity if we remove tariffs. As people prosper the climate suffers. China's move into modernity began in 1980 with the opening of the free market economy. The industrialization of China moved millions out of poverty but added billions of tons of CO2 to the atmosphere. China today produces 30% of the air pollution in the world and this continues to rise as they continue to grow. The global economy allows countries like China and India to grow but it also increases pollution. A win win agreement can be reached if the US sends natural gas to Asia to replace coal. Trade will permit the world economy to grow and at the same time reduce the increase in air pollution.

World Bank

The recent discussion about making America First has put international organizations like the IMF and World Bank under a microscope. The Bank for example makes loans to underdeveloped countries to say, build up their infrastructure. It can be shown that projects like this will increase the GDP of these countries and this is true but the increase goes mostly to a select few. These few have close connections to large western corporations and that is where the profits go. The poor people get little to no benefit. The same thing occurs in the United States when we have trade with foreign countries. It increases our GDP but the profits go mostly to large corporations and not to the middle income people who have lost their jobs to cheap overseas labor. The World Bank is presented as an agency that helps poor countries and uses this altruism to promote the reason for their existence but it is all a sham. US taxpayers give billions to the World Bank and this money is circulated through various loan programs and ends up in the pockets of US corporation who are building infrastructure programs in these countries.

Size of the pie

The argument between giving public assistance vs providing jobs can be best understood by watching how business people allocate their money. If a successful business gives their profits to charity they help a certain group on a one time basis. If, on the other hand, they reinvest their profits in the business they can create new jobs which help people on a continuing basis. A good example is Amazon, a company that has never paid dividends to its investors but instead has always reinvested the profits in the business. The result is that over the past 26 years it has created 876,000 jobs. Amazon reports very little profit because it reinvests everything it earns and thus pays very little in taxes. Investors make money because Amazon is a growth stock meaning investors make money not on dividends but by selling stock that has increased in value. In the past 5 years Amazon stock has gone from $800 per share to over $3,000 per share. This is more than a 30% annual return on investment. The government can only redistribute what is in the pie but business can increase the size of the pie.

Global economy

Milton Friedman was an economist who promoted the idea of free trade and his arguments made sense but they do not allow for government financing certain businesses with the expressed goal of running the competition out of business. When the Chinese government subsidized the steel industry it allowed China to sell steel on the world market at a price below the cost of production and steel companies around the globe went out of business. For almost 50 years, under the heading of globalization, the American middle income worker has been fast disappearing using a free trade policy of shipping jobs overseas. There is something that can be done about this and it was demonstrated by Trump. When Ford announced the plan to close an American auto plant and move production to Mexico, Trump told them they had the right to do that but if they did he would place an 25% import tax on any cars made in that plant that were shipped to the United States. Ford change their plans and invested $700 million dollars in the American plant and saved 700 jobs. Ford then said in a face saving statement that they made the change for other reasons. Moving production facilities overseas has increased profits for shareholders but at the expense of workers. The workers no longer have the protection that unions provided back in the 50's and the result is they have no recourse but to watch their jobs go overseas. One of the main results of globalization is the widening gap between the disappearing middle income people and the upper income group.

FBI

Jeffrey Epstein, convicted sex offender, hanged himself in a New York prison under suspicious circumstances. The Lolita Express flight logs to Epstein’s island were published online in 2015 and include over 1500 names of rich and powerful individuals. This was a private island in the Caribbean owed by Epstein. The FBI seized computers and other evidence but that has disappeared from the news. Epstein's associate Ghislaine Maxwell was arrested and is being held in detention in New York. Some question if there is a separate set of rules for the rich and if not why has this story all but vanished from the news. When stories like this are kept quiet it leads to speculation that some people get special treatment from the authorities. This is why many feel the FBI which has had its share of problems starting with J Edgar Hoover up through, the Daniel Ellsberg papers, Watergate cover up and most recently the Mueller investigation are suspect.

Poverty and jobs

The War on Poverty began in 1964 when the nation suffered from a 19% poverty rate. The office of economic opportunity was set up to provide various programs of public assistance. This involved the redistribution of wealth and has continued to this day. The emphasis was never on self sufficiency that would come from a good job but directed toward dependency on government benefits. Over the past 50 plus years this movement toward government aid has expanded and has not achieved the anticipated results. While overall poverty rates have remained fairly constant the rate among Blacks declined from 34% to 22%. This on the surface looks like success but at what price. While other Americans who had good jobs suffered slow but steady declines in their standard of living many living on public assistance saw their dependency growing. The facts are stark. Single family moms on welfare, poor performance in schools, drug use and high crime are often quoted. Even today democrats show little interest in creating good jobs for the minorities. Biden's plans for the economy are not clear but they mostly involve more government assistance with no emphasis on good jobs. Those further left like Bernie Sanders proposed government jobs for all. His plan was to have 20 million people working on green energy jobs, things like building solar panels and wind mills. Will private sector jobs decline while government jobs increase? Will this bring about a growing economy. Other countries have tried this without much success. Will the US be the exception to the rule?

This I wrote many years ago and send to my friends this time of year A NOVEMBER MORNING WALK A November morning walk is a special event. The gray clouds hang low on the horizon. The North wind, now filled with the first chilling reminder of winter, pushes the Autumn leaves across the pavement, rolling and crackling on their way to winter graves. The trees, that only last week, were bright with red and gold, now stand partially disrobed and dull brown against the morning sky. The heated activity of the past summer has subsided, and the time for regrouping is at hand. I look inward, and wrap myself up in the warm blanket of my feelings, as I prepare to hibernate with thoughts of peace and contentment. It is my time for preventive maintenance, and proper care of the soul. When I was in the first half of life, I had not time for such foolish behavior. I did not realize the joy of resting quietly in the forest, for I was busy rubbing the sticks of ambition and materialism together, to start the fires of progress that would set the forest ablaze. As I look back upon the charred remains of all this activity, I am thankful that I didn’t burn myself out. I will cherish each day of this seemingly forgotten month, as I build up my enthusiasm for giving and forgiving in the coming year, and then as the month comes to an end, it is appropriate that it burst open with a great thanksgiving for the past year. Now is the time when I will check my moral foundation, and my spiritual working parts, so that I am properly prepared to face the challenges that lie ahead. With all things in good working order I will best be able to share my gifts with others, and experience the truth, joy and love that is my destiny.

More on Globalism

There is more evidence that Biden wants to return to globalism as he as stated he wants to get rid of the idea of putting America first. Does this mean that America will just be like other countries. Does it sound like Obama's criticism of America as being exceptional. Does it mean rejoining the Paris Accords, the TPP, the WHO, the WTO and giving more authority to the IMF and the World Bank. Will the United Nations gain more power under Biden. Will Supreme Court cases start using world cases as precedent? Do most of our citizens want America to be just another country among others or would they prefer that America be better than others. Will we run from competition and allow every country to get a trophy. Is this another case of demanding equal results? Is it another game played without keeping score?

Globalism

After the Big War the US was the super power and some felt this power should be used to make the world a better place. It got started with the way the US helped to rebuild Germany and Japan. At that time the US held 50% of the worlds wealth with only 6% of the worlds population. As this concept continued it grew into the concept of globalism. The US did not have enough money to bring the world out of poverty but by using business it was able to make a significant contribution to the poor in third world countries. By the turn of the century the US and other western countries had moved over a billion people out of poverty. In the US this was accomplished by sending manufacturing jobs to China. This allowed American companies to produce goods at low cost and this allowed American consumers to buy these low cost goods. Slowly over 30 years the good paying jobs were replaced with low cost goods and it was like the rat in the pot of water that was slowly heated until the rat died. The blue collar workers figured out what was going on and elected Trump as someone who promised to reverse this trend by bringing jobs home from China. The question we now face is will Biden continue this trend or will he go back to the days before Trump. So far his cabinet represents going back. If that happens corporations will once again have access to cheap foreign labor and the profits that go along with it. The blue collar people will trade their good jobs for everyday low prices at Walmart.

College or not

A student majoring in liberal arts can learn just as much by staying at home and reading. Typical liberal arts degrees are the study of history, literature, writing, philosophy, sociology, psychology, creative arts and more. This requires self discipline that many college age students do not have. It cost much less but means no social life meaning party time. The employer will not know what you have learned but if you start working and do your self education while working you will soon prove your worth. The boss will quickly realize that you are self starter with the self discipline to stay on task. Working and paying your own light bill will cause you to mature into a productive worker faster than spending 4 years going through the motions of learning while spending most of your time wasting time. College for serious students will pay off but too many are there just taking up space. It is estimated that the cost of a liberal arts degree including loan interest and loss of income is over $400,000. The average starting salary for a liberal arts major is $38,000. Starting pay at Amazon is $30,000 per year. If you are not really fired up about getting a formal education you may be better off forgoing college and joining the work force right after high school. It is something to consider.

Student loan debt

When banks got too big they made risky investments knowing that the government would covered their losses if investments went south. This is called a moral hazard. The same thing was part of the plan when certain states like California and Illinois ran up their pension debt feeling that before the state went broke the feds would come in and save the day. Some feel that student debt followed the same pattern with those in debt believing that the feds would help them. If the federal government does step in, will this encourage others to take on debt they cannot repay, things such as home mortgages or even car loans and credit card debt. Currently there is $1.6 trillion in student loan debt and $1 trillion in credit card debt. Should the government pay off this debt? What would be the justification of paying off one kind of debt and not others?

Green energy

A case can be made showing that most people are only interested in climate change as it relates to politics. Scientist will point out that there currently is no practical replacement for fossil fuel yet this is routinely presented as a possibility. These same people are opposed to nuclear plants. They never mention using natural gas for transportation. The never bring up the problems with mining rare earth metals. They don't discuss the wait time to charge up a car battery. They have no answer to the problem of what to do with air travel and heavy equipment like bulldozes, semis, tractors and so on. They oppose fracking without a replacement and without explaining how the world will keep going without fossil fuel. On an individual basis they live in large homes on large lots that require more energy for heating and cooling. The lawn needs watering, fertilizer, herbicides and pesticides. Many of these same people have a second home with all the same requirements. They drive SUV's and commute miles to work each day so they can live in their large homes in the burbs. They have garages or storage sheds filled with lawn care equipment like mowers, edgers, trimmers, leaf blowers and snow blowers all of which require more fossil fuels along with recreational vehicles like four wheelers, motor bikes, snow mobiles and boats. For some the recycling of there used soup cans shows they care. The main groups that promote climate change are those who earn a living writing about it and those who manufacture solar and wind equipment. All those who truly understand the problems associated with climate change will act on what is written above. Here is one statistic. There are 55 million acres of irrigated farm land an 40 million acres of lawn.

Wall Street

Biden, following the advice of Senator Warren, is getting tough on Wall Street. He is putting Gary Gensler in charge of the financial transfer and Gensler is an outspoken critic of the big banks. During the campaign Biden promised to raise taxes and increase regulations on corporations. This seems to conflict with campaign finances donations since Biden collected $800 billion to Trumps $500 but more to the point Wall Street contributions to Biden were $75 billion vs Trumps $15 billion. It must not be true that money buys influence. They may have gone to Biden putting the country ahead of profit. This truly is a new day.

Asian American

Mexico has deployed their troops on their southern border and the results are positive. The U.S. apprehended 47,243 migrants from Guatemala, down from 264,168 the year before; 40,091 from Honduras, down from 253,795; and 16,484 from El Salvador, down from 89,811. As a result most of the people now coming across the US southern border illegally are Mexicans. As more illegals are stopped this allows room for more legal immigrants. The legal immigrants are coming from Asian where they are better educated and badly needed by the high tech industry. Asian Americans are the fastest growing voter group and their numbers doubled between 2000 and 2020.

Asian immigrants

There is something about our education system that points people away from careers in science and engineering. The only other explanation is that the Americans are not talented or not interested in those areas. Only one in six of high school seniors is proficient in math. China and India have twice as many STEM(science, technology, engineering and math) grads as the US. Countries like Canada and Australia recognize this and set their immigration programs based on merit. This has been happening without a special law to promote it since the top two countries where immigrants come from are China and India. These people come with tech skills that are needed here and thus they find good jobs where they can support themselves. Once here they promote the value of education and their children are the best performing students. In addition more are proficient in English than immigrants from Mexico and Central America. In both China and India English is taught from a young age. It is not racist to promote these better educated immigrants since they are all brown skin people.

1968

There is a tendency to believe the times we live in are extraordinary and that seems to be the case with 2020. Many people are too young remember 1968. The year was filled with antiwar protest in 150 major cities culminating in the killing of four Kent State students by the National Guard. The democratic convention in Chicago was a picture of mob violence inside and outside of the center. I recall watching Walter Cronkite go apoplectic when his young protege Dan Rather get gut punched by a police officer. The crowds outside were being clubbed by Mayor Daley's troops and the party was torn in half with some siding with the Pro war forces of Johnson and others the anti war McCarthy forces. Later Robert Kennedy came in on a white horse to rescue the party and he was assassinated. It was the year that MLK was assassinated and this led to race rioting as they joined in with the anti war folks. The republican party was split between the old guard Rockefeller's and the formerly disgraced Nixon who arose from the dead like the phoenix. The war put much more stress on everyone than this years election but that was long ago and far away.

Assembly

Freedom of assembly is part of the first amendment and allows citizens to express their opposition to government policy. When these gatherings are peaceful they show the strength of the constitution. There are certain groups who take advantage of this freedom to disrupt and try to cause trouble. The strategy is to provoke the police into attacking the protesters. In general these people are upset with the way they see the country. If you concentrate on the failures of the US you can find plenty. If you concentrate on the good you will have a different view. For some the way to make changes is through revolution as happened in 1776 while for others the ballot box is the way. Each person must choose their way to improve the country.

Fossil fuel

Don't let the perfect be the enemy of the good is an old adage and applicable today in regards to climate change. The road to lowering CO2 passes through several stages in several different ways. First continue to replace coal fired power plants with natural gas. As natural gas plants get old replace them with nuke plants. Build wind mills and solar panels next to existing natural gas power plants using the gas as backup. Install solar and wind for homes using existing heating sources as backup. Start moving cars and small trucks over to natural gas. Continue to increase exports of natural gas to help other countries move away from coal. Start exporting natural gas vehicles to change the world to natural gas. Start building nuke plants today to cover tomorrows needs. These things are not being done because political concerns have deemed it necessary to move directly from fossil fuels to wind and solar. While electric cars and small trucks will continue to be sold they will not replace existing cars until the battery charging time is reduced. No scientist has said we can have air transportation without fossil fuel. Hydrogen is an options but currently to costly to produce. The same can be said for heavy construction equipment, large farm tractors, rail locomotives, semi trucks and large ships. While waiting for the perfect answer let's keep moving toward perfect. All of these things could have been started 30 years ago like the change over in power plants. Why weren't they? Politics.

401K and debt

Polls show that many people are are willing to accept higher taxes to pay for programs like green energy and free college. Some are willing to take assets from rich people in the form of a wealth tax. Both of these groups assume that none of their money or assets will be taken. The assumption is that some rich person will pay for this but there are other ways. For example, the current national debt is $27 trillion and there is about $29 trillion in 401K plans. The government could confiscate these funds and pay off the debt. That sort of puts a different light on the situation but it would be an egalitarian thing to do since the rich have the most in these accounts.

Rare earths in the US

Many experts say the Paris Agreement is necessary to save the planet. Here is a quote from environmentalist Nafeez Ahmed To meet greenhouse gas emission reduction targets under the Paris Agreement, renewable energy production has to scale up fast. This means that global production of several rare earth minerals used in solar panels and wind turbines—especially neodymium, terbium, indium, dysprosium, and praseodymium—must grow twelvefold by 2050. China is the world's dominant producer of rare earth elements with more than 95% of production. China has threatened to cut exports. Chinese state media have backed the idea saying America’s dependence on Chinese rare earths “an ace in Beijing’s hand.” The US has these metals. According to mining experts, Bear Lodge in Wyoming is home to one of the richest and highest-grade rare earth deposits in the U.S., with an estimated 18 million tons of rare earth inside. The US currently uses 13,000 tons per year so this would be a 1000 year supply.

Nuke power

Back in 1997 President Clinton wanted to be a signatory to the Kyoto Climate Treaty but congress was opposed and the senate voted 95 to 0 against the idea. Treaties require senate approval. In 2016 President Obama signed the Paris Climate agreement using executive action since it was not a treaty. The US is one of the few countries that has reduced CO2 emissions. The biggest polluters China and India have continued to increase emissions. There are steps the US can take to make progress. The best way for electric vehicles to reduce CO2 is to use power from nuke plants. There are 95 nuke reactors in the US with two coming on line this year. The first was built in 1958 and new plants with new technology should be built on a regular basis replacing older plants with old technology. In 1979 an accident at the 3 Mile Island plant allowed radio active steam to escape and people had to be evacuated. No injuries or adverse health effects resulted. Understanding the benefit/risk ratios must be considered and the building of new plants seems a safe way to go since it will allow electric vehicles to operate without increasing CO2 levels. New plants produce low quantities of waste and this is properly stored. The next way to get power for electric cars without increasing CO2 is using wind and solar. Here the trade off is clean air for the US and dirty water for China since the mining of rare earth metals is poisoning the Yellow River in China. The down side to both of these is the time it takes to charge up the batteries. A third way is to use natural gas for transportation. This produces CO2 but at lower rates than gasoline and does not emit heavy metals and acid rain. The US has reduced CO2 levels by moving from coal to natural gas in power plants and the same can be done using natural gas for transportation.

401K and debt

Polls show that many people are are willing to accept higher taxes to pay for programs like green energy and free college. Some are willing to take assets from rich people in the form of a wealth tax. Both of these groups assume that none of their money or assets will be taken. The assumption is that some rich person will pay for this but there are other ways. For example, the current national debt is $27 trillion and there is about $29 trillion in 401K plans. The government could confiscate these funds and pay off the debt. That sort of puts a different light on the situation but it would be an egalitarian thing to do since the rich have the most in these accounts.

Republican senate

The race for the senate is close with the deciding votes in Georgia. Biden would be best served if the republicans hold the senate. If the democrats have the majority in the house, senate and White House the left leaning folks will demand their agenda. Their argument will be first off get rid of the filibuster. After that they will have the votes needed to legalize all illegals, replace fossil fuels with the green new deal, raise taxes, install a wealth tax, allow unfettered immigration, offer free college, give government jobs to all who want them, restrict gun ownership, pact the court and so on. Bernie and friends will demand action. Biden is more of a centrist and would prefer to stay away from the extremes. With a republican senate he has an out.

Equality

There is a cadre, sometimes referred to as eastern liberal elites who have gathered under their wing a group of people who consider themselves as victims. This group includes minorities of all kinds. In many cases they are heavily dependent on public assistance. The goal of the elite is to achieve equal results and be rewarded with votes. It has been going on since the 60's and it getting stronger by the year. The lure of benefits is powerful for all groups but more so for those who feel the greatest need. This potential problem was foreseen by Benjamin Franklin when he said, “When the people find that they can vote themselves money that will herald the end of the republic.” This movement will concentrate power into the hands of a few who are seen as benefactors and people will unknowingly trade their individual freedom for benefits. Once a benefit is given, it is almost impossible to take it away and this becomes a one way street. The long term result will be that instead of the average family income being $60,000, every family will earn that amount except for the elite leaders who will earn much more. It will be as Orwell said in Animal Farm, everyone is equal but some are more equal.

Child deaths

Nine high schools in our area are going to 100 percent distance learning. This does not include K to 8 students. These young people will not go home and infect their grandma with the virus like the high school students will do. In addition it tells us that elementary teachers are expendable. This is just one more example of the inconsistencies in how the virus is handled. The emphasis has to be on the elderly. The nursing homes, eldercare facilities, hospital, clinics and all places where older people are found. Only 60 people under the age of 18 have died from the virus and many of those had underlying conditions. There are 75 million people under age 18.

Obamacare today

This is an excerpt from an article I wrote in 2014 and it is even more relevant today. As I talk with people about Obamacare, I get the same questions from different groups and by these questions I can see that there is a lot of misunderstanding and one area that needs addition explanation is deductibles. In researching this I find that 90% of articles talk only about premium cost and it is very difficult to find information on deductibles. I don’t know if that is done out of ignorance or by design but it is a topic that needs more discussion. Here is a report for the coming year. For the 2021 plan year: The out-of-pocket limit for a Marketplace plan can't be more than $8,550 for an individual and $17,100 for a family. For the lowest income groups this can be $2,700 for individuals and $5,400 for families. This does not include the cost of the monthly premium which can be reduced by subsidies. The point is that most people will have to pay out of pocket for most of their healthcare.

Expert

So often the experts say the reason the Dow went down is because the investors dislike uncertainty. Having a presidential election results tied up in controversy can be unsettling but the Dow has gone up 2,000 points since the election. So much for the experts. My favorite definition of expert is a man who knows more and more about less and less until he finally knows everything about nothing.

Amazing Trump

Trump is one amazing individual. For those who have never read Theodore Roosevelt's, "Man In The Arena", now is the time. https://www.artofmanliness.com/articles/manvotional-the-man-in-the-arena-by-theodore-roosevelt/ Trump went up against the democratic party, the establishment bureaucrats, Silicon Valley, Hollywood, Social Media giants, the republican never trumpers, Wall Street, Big Pharma and the national press and just about pulled it off. The press coverage amounted to four years of character assassination with 92% negative stories. Very little was said about his policies and it was mostly about his personality. Many feel that it was the pandemic that made the difference. Trump has changed the politics of the country. The republicans now represent the blue collar working people. Trump increased his share of minority voters over the 2016 election. It appears we will have a Biden Presidency carrying out the Trump agenda. The real loser in this election was the national press. Their decision to pick a side will hurt their credibility for some time.

Election results

If the election results hold up it will be a win for the American people because it represents compromise. The democrats lose a few seats but keep the house, the republicans lose a seat and keep the senate and Biden wins a narrow victory. This means no new taxes, no green deal, no amnesty for illegals, no open borders, no second virus stimulus, no wealth tax, no impeachments, no Medicare for all, no free college, no change in Roe even though abortion disproportionately effects Blacks in a negative way and no riots in the streets. It means bringing home jobs from China especially those regarding medical supplies, a possible infrastructure bill, a press that concentrates on policies instead of ranting about personalities, a stock market that continues a slow but steady rise, a willingness to open the economy, continued energy independence with fracking and free trade with fair or no tariffs. Biden knows that China cannot be trusted and will not sign the TPP. He understands that climate change will fade into the background with a democrat in the White House. He knows that replacing fossil fuels with wind and solar is not possible with current technology so the Paris Agreement makes no sense. In the Middle East he will follow the plan to by-pass Palestine and organize the other Arab countries to work with Israel so there is no need to make an agreement with Iran. The downside is that spending $7 trillion on the virus may trigger inflation which will cause interest rates to rise and servicing the debt may harm economic growth.

Lawyers

Three fourths of the members of congress are lawyers, all in the judicial are lawyers and now it appears that lawyers will decide the election and they fight things out in the court. Everyone should sleep easy tonight knowing that these well educated intellectuals are taking care of us.

Corp taxes

The stock market has always been a mystery to me and this was reinforced by an expert who was on Fox Business this AM. He said the run up yesterday was because the market is expecting a Biden victory. The news people pointed out that Biden plans to bring back the regulations that Trump has canceled and that Biden plans to raise the corporate tax from 21% to 28%.