Data centers

Although Bill Gates officially left Microsoft in 2020, he is still active in the company and one of his projects is building a molten salt nuclear reactor in Wyoming. The public hears that he is doing this as his contribution to clean energy but there is a ulterior motive. Microsoft, much like Amazon and Facebook, have large data centers that need lots of electricity and here is where this may directly effect the average consumer. With the coming of AI these big companies will need copious amounts of electric power to operate their new data centers and one course of action to get power is to build the data center next to an existing nuclear power plant and buy the power from their next door neighbor. Plants that are currently selling power at $50 per megawatt to consumers will soon be getting offers of $100 from their new neighbor. These data centers cannot use wind and solar because they must have continuous power. The new centers will be so large that they could easily use all of the power the plant can generate and they would be willing to sign long term contracts guaranteeing a profit to the power company many years into the future. They will have no concern about transmission lines since their only customer will be next door. As we speak Microsoft is opening the nuclear power plant at Three Mile Island that was closed in 1979 so they can build a data center next door.

SMR

Former Secretary of Energy Rick Perry was interviewed and stated that Trump is all in on small nuclear reactors. He pointed out that Trump has repeatedly spoken about nuclear power. Nuclear company stocks have risen rapidly since the election and now have more assets than all other clean energy stocks combined. Trump has pledged to reduce regulations on nuclear and speed up permitting. Vistra Corp a company that operates nuke plants has seen its stock double in the last two months. Some of these improvements could happen quickly as a number of existing plants have been waiting on paper work to expand their output and changes here could result in increased production within weeks. Here is Trump from Joe Rogan. Trump pointed to small modular reactors (SMR's) as a potential answer to long-running cost concerns surrounding the energy source. He believes that smaller reactors, which can be built in a factory, could avoid the complexities associated with large reactors. Little by little SMR's are gaining advocates and in time will prove to be the answer to climate change.

Work from home

As the talk about cutting government waste rises to a fever pitch the news centers around cutting staff which is a very small part of the waste but gets an inordinate amount of attention. For example about 50 percent of the people work from home as a product of the Covid. The question is how does the boss know if their working. The extremes recently came into public when mouse jigglers were discovered. This is a program which allows the computer to move the mouse periodically to avoid the computer from going to sleep so anyone checking will think someone is working. Many government employees are both civil service and unionized. In one very rare example a small unionized group had a contract that said you must work one day per month in the office. Some enterprising workers set up to work the last day of the month and the first day of the next month. This allowed them to relocate out of the expensive DC area and move to a low income state like Tenn and commute once every two months to the office. People are very creative. If the rules are changed and people are forced to work in the office many of these employees will resign and look for jobs near their new home. They won't want to go back to the high cost area and fight traffic two hours everyday.

Australia

If you want to see a clown show when it comes to replacing fossil fuels with wind and solar just take a close look at Australia. The people have decided that climate change is a threat to the world and have demanded the change. For many years the country has used coal and had low cost electric energy. They have enough coal to last many years but have chosen to close down the coal plants, closing 12 since 2017 and scheduled to close the remaining 24 by 2034. Since they have not been able to replace this energy the cost for the average household has gone from 6 cents per kWhr to 30 cents so the bills are five times higher. As if to add insult to injury the people no longer want natural gas to be used and since the country has huge supplies they are exporting the gas. They have constructed export facilities to liquefy the gas for export rather than use the gas inside the country. Since wind and solar are not reliable some places are using natural gas to eliminate black outs and many of these are importing gas. They need 22,000 new windmills which will require 600,000 acres of land most of which will be cut down forest and 10,000 miles of new transmission lines. This transmission does not include the local distribution lines which will need thousands more miles. For each EV is the equivalent of a new house in the neighborhood so if each home has an EV then the distribution system must be doubled. Transmission cost currently represent 10% of the monthly electric bill and distribution cost 35% so these two items will increase the cost by 45%. Putting the final nail in the coffin Australians do not want any nuclear power. In all of this no mention of the environmental damage done by the mining, processing and disposal of the elements needed for wind and solar.

Mexico

In the recent reporting of conversations between Trump and Mexican President Claudia Sheinbaum, Trump once again showed that he was not a politician. It started when Trump said he would impose a 25% tariff on Mexican imports if Mexico did not stop the caravans. This prompted a phone call in which Sheinbaum said, In a post on X, Sheinbaum said she told Trump that migrant caravans are not arriving to the US border because they are being “addressed” in Mexico. Trump immediately went for the jugular and said, She has agreed to stop Migration through Mexico, and into the United States, effectively closing our Southern Border. Sheinbaum was just elected in June and wants to get off to a good start and would lose credibility if faced with these tariffs. Trump is in his last hurrah and holds all the cards. While the tariffs would be bad for the US they would be devastating for Mexico. US imports from Mexico represents 12% of total US imports but Mexican imports from the US represents 43% of their total imports. Mexico's economy is highly dependent on foreign trade, with about 80% of its exports going to the US The ball is now in Sheinbaum's court.

Inflation

As massive reshoring gets underway, the big downside will be wage/price inflation. This can be offset by an increase in productivity which can come from two main sources. First is the combination of new facilities and new processes combined with AI. The second from a reduction in regulations and this can be accomplished by Doge being run by Elon and Vivek. As they eliminate both projects and people the companies, relieved from the burden of regs, can devote their energies toward efficiency. As workers produce more they are entitled to more compensation. The big worry is the shortage of workers and thus high schools and trade schools must begin adjusting their curricula to meet the new demands. Immigration rules must use a merit based system to bring in the trained people needed. If all of these different agencies coordinate their efforts the country can achieve new growth without inflation.

Musk

The high compensation received by CEO's has come under attack and the recent approvals by the shareholders of Tesla to provide Elon Musk with a $46 billion dollar bonus represents the most extreme example ever. Why did they do it. The answer was given by Chairwoman Denholm in a letter written to the shareholders which stated, "If Tesla is to retain Elon's attention and motivate him to continue to devote his time, energy, ambition and vision to deliver comparable results in the future, we must stand by our deal." While this is a lot of money it pales in comparison to the fact that Tesla stock has increased over $100 per share since the election and Musk owns 715 million shares. This increase results in the tidy sum of $71 billion. Musk is now worth $326 billion. He may finally answer the question can a person have too much money. This makes Musk the equivalent of the 21st wealthiest country of the worlds 195 countries.

Votes

As of November 1 of the election years the Harris campaign spent $881 million while the Trump campaign spent $356 million. This was similar to 2016 with Clinton spending $564 million to Trump's $333 million. In 2020 Biden spent $1,044 million and Trump spent $774 million. There seems to be little to no correlation between the amount spent since 136 million voted in 2016, 153 million in 2020 and 158 million in 2024.

Jobs

It is often reported that over the past 50 years the US has lost 8 million manufacturing jobs and that is a true statement as far as it goes. Another more accurate way of looking at this is to note that in 1970 about 25% of jobs were in manufacturing and if that were the same today we would have 40 million manufacturing jobs and we have 13 million. This is the big picture that shows the true devastation that has befallen the working class primarily because of globalization which was ignored by politicians who claimed to be the guardians of the working class.

Power brokers

For the past few weeks since the election many Washington insiders have presented their views on Trump's policies and nominees and most have been negative in their assessments. If you are a person who has spent 20 or 30 years developing relationships with elected officials and un elected bureaucrats your source of information and influence is greatly limited by Trump's approach to government. Trump has refused to follow the old ways because he doesn't trust the inside power brokers and this leaves these people out in the cold. The new president is supposed to pick someone with experience in a department to run that department which means stay with the status quo. Robert McNamara was President of Ford Motors, then Secretary of Defense and then President of the World Bank. These are very different jobs but he had was are called transferable skills. His administrative and management abilities allowed him to head these organizations without having direct experience in them. These experienced, many behind the scenes operators, see their lines of information being disrupted meaning their ears to power will be blocked and they are not happy.

Ukraine

For two years we have been watching a parade of generals showing up on TV, both legacy and cable, all singing the same song. We must defeat Putin or he will try to rebuild the old Soviet Union. They say it will be a battle of which side will outlast which and the fight must continue as Biden said as long at it takes. If you assume they are correct what you end up with is a gigantic pile of rubble that used to be Ukraine. These generals bask in the sunlight of war and they relish their time on TV as experts in how to conduct war. The people of Ukraine that are left in the country after the war will not feel victorious as they survey the destruction along with the loss of lives. Millions have left and may not return while all too many are injured and dead.

Nuclear

Germany, the industrial juggernaut of Europe, is in an economic downturn as it enters its third year in a recession. What happened and what can be learned. The peoples rejection of nuclear power goes back to the 1970's when protesters objected to the building of nuclear plants. This was many years before Chernobyl. In 1993 the German Green Party was started to protect the environment especially the fight against climate change. To achieve their objectives they pushed for wind and solar to replace fossil fuels. Germany had 17 nuke plants and they started shutting them down after Chernobyl and the last three closed in 2023. A good case can be made that all of this was an emotional response. First off, no studies were conducted to find out how much wind and sun did Germany have and as it turns out,very little of either. Second no study was made to determine the environmental damage caused by the mining, processing and disposing of the materials needed for wind and solar as well as EV's. Third, scientist now agree that nuclear is an excellent source of carbon free power. The final nail in the coffin came when Germany, in response to the Ukraine War, chose to cut off natural gas and oil imports from Russia. The result is that Germany is now reopening old coal plants when they should be opening old nuke plants. Germany shut down nuclear out of fear and now say they will not reopen because of cost. Will the US learn anything from this or will they continue to believe that wind and solar can replace fossil fuels and refuse to build new small nuke reactors.

Migrants

The insistence by some cities and states to retain their sanctuary status requires a review of what has happened over the past four years. Early in Biden's term he reversed most of Trump's border policies which allowed the number of migrants to increase from 40,000 per month to 240,000. This resulted in the fentenyl deaths to over 300,000 young people. There are 320,000 unaccompanied minors that the government cannot locate and many feel are being trafficked. The cartels made $500 billion per year according to the Washington Post. According to the NY Times 80% of women and girls are molested crossing Mexico. The number of criminals crossing is hard to determine because of the 1.7 million got aways that are known plus others that are unknown. There are currently 425,431 non-citizens with criminal convictions on ICE's non detained docket including 13,099 for homicide, 15,811 for sexual assaults and 62,231 other assaults. Interfering with ICE could result in mixing criminals with non criminals when they try to deport. This then will make the national news and make further deportations more difficult. It is mindful of how Hamas mixes fighters in with the general population.

Middle class

The struggles of the US middle class began in the Reagan era but accelerated during the Clinton years. When Clinton signed a free trade agreement called NAFTA many remember the words of Ross Perot when he said, the giant sucking sound you hear is jobs going to Mexico. His words fell on deaf ears and manufacturing jobs moved out of the US to Mexico and this was the beginning of what later was called the Rust Belt. This was the early formation of globalization. Then Clinton supported China's entry to the WTO which resulted in more transfer of US manufacturing overseas. Clinton followed this up with the repeal of Glass Steagall which led to the development of super banks which financed the new manufacturing plants in places like Mexico and China. Over the next 30 years 8 million good paying factory jobs were sent abroad and the middle class suffered while big business reaped huge profits. This is all being reversed with the end of globalization and the reshoring of industry.

Electricity

It is becoming more evident each day that the need for electric power is growing faster than the country can produce. Not only will the industrial base grow rapidly but the need for power by data centers necessary for AI are pushing the limits. Add to that many people are pushing for EV's which would crash the grid. Fortunately people are not buying EV's. Wind and solar cannot do the job without destroying the earth and the only conclusion is nuclear. Scientist are waking up to this fact and causing governments to take action. As this realization sets in the next step is to move to small reactors manufactured on the assembly line and shipped to the use point.

Economy

As the national debt crossed the $36 trillion line this week the news once again focused on the idea of how much longer can this keep going. The national debt in 1996 was $5 trillion. Each year as the country spends more than it takes in it borrows to cover the difference. Since everyone knows that you cannot just print all the money needed to satisfy every want, then what factors decide the limit. Probably the most important is interest on the borrowed money. Interest cost $468 billion in 1996 and $890 billion in 2024 but the GDP in 1996 was $8 trillion and in 2024 it was $29 trillion. To get an apples to apples comparison the percent of interest on the total debt was 5.8% in 1996 and 3% in 2024. Most economist say that as long as the interest rate owed on the debt is less than the growth rate of the economy the debt will not be a problem. While this looks promising consider that interest rates have been very low during this time period. This is why Modern Monetary Theorist say that you can print all the money you need as long as you keep inflation under control. This will pose a problem in the coming years as reshoring leads to a doubling of the industrial base which in turn leads to higher wages which in turn leads to wage/price inflation. As the economy heats up the Fed will raise interest rates which will also add inflationary pressure. The goal will be to keep wages ahead of prices as was the case in the 1950's. The economy overall grew by 37% during the 1950s and unemployment remained low, about 4.5%. At the end of the decade, the median American family had 30% more purchasing power than at the beginning.

Germany

A review of recent German history over the past twelve years can be seen as a precursor to what happened just a few years later in the US. The switch of the working people to the conservative side started in the poorer areas of East Germany, the part was in the former Soviet Union. They saw the elites concentrating on wind and solar and electric cars while the incomes of the poor were stagnating. They watched Germany bail out the southern countries of the European Union while the utility prices rose because the nuclear power plants were being shut down. Then in 2015 German Chancellor Angela Merkel opened the door to refugees from some war torn countries in the Middle East and over a million came to Germany and started receiving benefits while the poor citizens stood by and watched. This resulted in the rise of the conservative voter and the new members were mostly working people. They wanted to establish a minimum wage which would discriminate against refugees following the US plan which was used to discriminate against Blacks. This new AFD party has now gained enough power to influence the government. At this point Trump comes along and the working people began their move toward what has become known as common sense. The poor people wanted the government to hear their concerns about bringing jobs home and not welfare for migrants. They wanted higher wages not social justice. They watched good paying jobs in the coal industry disappear while money was being invested in wind mills and solar panels. All of these concerns continue today and the working people are demanding change.

Jobs

As the emphasis on government waste grows there are many examples of strange projects such as $1.5 million to determine why prisoners want to escape from jail but these things are just distractions from more important areas. One case is the government jobs programs of which there are eleven. Indian and Native American Jobs Corps Apprenticeship Dislocated workers Migrant and Seasonal farm workers American Job Centers Veterans Safety and health Employment and Training Administration Grants Internship Program In the news we see there are 8 million unfilled jobs in the US. Are any of these programs working to fill those jobs. One of these programs, The American Job Centers has 2,300 locations across the country with a budget of $11 billion dollars. Not able to find out how many work there.

Ratings

The relationship between the FDA and big pharma has come under scrutiny since Trump nominated RFK to head HHS. The FDA gets half of its income from the pharmaceutical industry through a program called user fees. One of the results is the fact that nine out the past ten FDA commissioners went on to work for big pharma. This is not a surprise to me since I am well aware of how big life insurance companies are in partnership with the rating companies like Moody's and S and P. The insurance companies pay the rating companies for their service. This leads to a conflict of interest.

FBI

It has been suggested that some of Trump's nominees for cabinet positions have been slowed because they may not be cleared for top secret classification. Top secret is considered the highest level of classified information. There are currently 1.25 million people cleared top secret many of whom are government contractors. The FBI normally does the back ground checks but many recall that the FBI, since the days of J Edgar Hoover, has used secret information to influence and control. If some nominee is planning on revamping the FBI will they be tempted to leak information to twist the meaning of certain events to derail a nomination. This is just one reason why making changes to the bureaucracy are so difficult.

Bitcoin

Someone in my book club group asked about Bitcoin and I said I didn't know much about it but later I did some research and came up with an answer. It appears there are knowledgeable people on both sides of the issue but most see things in the extreme. It appears that Bitcoin is set for a big change either up or down. That means there is 50/50 chance of making money and that is in the area of speculation rather than investing. This means you should not count on this as a retirement vehicle but to be used for money that you can afford to lose. You can invest in the stocks and have an almost sure thing of earning more than the inflation rate over the long term as there has never been a 20 year period where the stock market did not have a positive return. Investing in Bitcoin requires a higher risk tolerance that is not conducive to retirement savings.

MSNBC

The future of MSNBC is up in the air since the election. Back in 2016 when Trump won the network maintained a reasonable audience by promoting the Trump/Russia hoax. They would reveal new information on regular basis and people tuned in to hear the latest. The fact that the investigation came to the conclusion that there was no collusion did not deter the listeners as they were fully committed to certain belief and they held to them. This time there is no major theme to hang on to but a series of smaller events like cabinet appointments and minor skirmishes regarding rights of trans people. In order to gather and hold onto an audience in today's world it seems necessary to look for a niche sector. MSNBC listeners are mostly anti Trump people and so the network will probably continue to produce negative stories about Trump in order to keep its rather small group of faithful viewers who find their comfort zone where they can hear talking heads ridicule Trump. In time Trump will make moves that alienate certain groups and the network will be able to pick up some of those and make a come back. Without the use of NBC network facilities MSNBC will become more like a podcast.

Waste

For all of my life presidents have campaigned with the promise to end waste, fraud and abuse in the federal government but not one succeeded. The news would report on the fat lady paying with her food stamps and then driving off in her Cadillac while all the time it was the bureaucracy that was the true welfare queen. All of the best laid plans in the past required the current federal employees to cut their own budgets but that was like asking congress to introduce term limits. This time things are different. Outsiders who are not yet addicted to slurping in the trough are coming in fresh and not yet bought off by the lobbyist. These people will be closely watched by Elon and Vivek who will post their findings on Elon's podcast and on X. Currently Musk has 200 million followers but this number will rise quickly when they start exposing government waste. These two people will receive no salary which is mindful of WW 2 when many to top executives worked as dollar a year men. This will be a tough battle because the bureaucracy is so entrenched and will not give up power without knock down drag out fight. The constitution calls for three branches of government, Executive, Legislative and Judicial but the forth branch called the bureaucracy has risen to equal status and needs to be trimmed. The first test will come when senators who are part of the swamp will be asked to put the people first and their reelection fund second and approve those who want to cut back on waste.

War

The Biden administration has approved sending anti-personnel mines to Ukraine for the first time in another major policy shift, Secretary of Defense Lloyd Austin confirmed on Wednesday. Secretary of Defense Lloyd Austin says Putin is just bluffing about retaliating with nukes. To many it seems that the defense industry is working with the bureaucrats to keep the war going. The use of anti personal mines is banned by more than 150 countries including the US and Russia That is why in 1997 the international community adopted the Anti-Personnel Mine Ban Convention, which prohibits the use, production, stockpiling and transfer of these weapons and requires action be taken to prevent and address their long-term effects.

Migrants

The subject of how to deal with illegal migrants is taking center stage because it was one of the major issues in the campaign. Things are getting complicated and out of hand because it has become a political issue rather than an immigration issue. The logical approach is to first deport all those migrants who are convicted criminals. Second, deport the 1.4 million that the courts have determined do not qualify for asylum. Third find the 320,000 missing unaccompanied migrant children. Forth begin the process of evaluating each migrant to determine what happens to them and set up some system which will lead to a path to citizenship. All of the above depends first on closing the border. For many years distinguishing between legal and illegal immigrants has been blurred and now the migrants that are good citizens are being lumped in with those who are not. Instead of the various government agencies cooperating with one another they are fighting with one another. People get so tired of this bickering.

Education

The Department of Education is once again in the news. No one is satisfied with the test scores and in particular the differences between White students vs students of color with the major exception of Asian students. One area of concern is the staffing of schools. District 196 here is composed of Rosemont, Apple Valley and Eagan. There are 27,000 students, 1,879 teachers and 2,121 staff. For many people these numbers show how far the schools have drifted away from the three R's and now include all sorts of other specialties. This same thing carries over to colleges. The University of Minnesota has 55,000 students with 4,823 teachers and 22,834 staff. This includes 300 different degree programs.

Tariffs

Biden retained the tariffs that Trump placed on China plus the following changes. The tariff rate will go up to 100% on electric vehicles, to 50% on solar cells and to 25% on electrical vehicle batteries, critical minerals, steel, aluminum, face masks and ship-to-shore cranes beginning September 27, according to the US Trade Representative’s Office. Tariff hikes on other products, including semiconductor chips, are set to take effect over the next two years. President Trump will continue this policy plus he plans to install a blanket tariff of 10% to 20% on all imports, with additional tariffs of 60% to 100% on goods brought in from China. Trump's plan is at this point only a negotiating tool. The US currently has a negative balance of trade with Europe of $131 billion and a negative balance with China $195 billion. Much of this has to do with tariffs.

Reshoring

Over the past 50 years politicians from both parties have been co opted by a partnership between business and government. The result has been growth in government power and profits for business at he expense of factory workers. These workers, people who are paid by the hour, have watched their jobs disappear as globalization became the policy and the bureaucracy became the status quo. While the American elite talked about idealistic goals like climate change and freedom they worked to send jobs to China where coal was king and low wages and slave labor were the norm. That started to change ten years ago when Trump pointed out the unfairness of China's trade policies and it has gained momentum ever since. Globalization is out and reshoring is in as companies are bringing worker jobs back home to the US. This means a doubling of the US industrial base over the next ten years but these new facilities will combine workers with the latest technology including AI, which will increase productivity which means higher wages. The downside is wage\price inflation but if things balance it can be like the 1950's where wages increased slightly faster than prices.

Ukraine

The next mission creep. Biden allows Ukraine to make long-range missile strikes into Russia. November 18, 2024. Recall that the reason for NATO helping Ukraine was to keep Russia from winning but at the same time to keep Russia from losing since it could result in Russia using nukes. Has the original reason changed and if so what is the new strategy.

Tax

The proposal to remove taxes on social security benefits should not stand alone but must include other changes to make up for the lost income. This will not affect 60% of recipients who do not pay any tax because their income in too low. This will cost the government about $50 billion per year and should be recovered with other changes. Currently people pay 6.2% of earned income into social security on the first $160,000 of income. If this income limit were removed it would bring in about $90 billion per which would more than offset the loss from not taxing benefits. This would also transfer money from high income earners to lower income groups which would help to reduce the income gap. It would also add more money to the social security fund something that is badly needed.

China

As WW 2 came to an end, a civil war broke out in China and lasted until 1949 when forces led by Chaing Kai-shek rebelled against Mao Zedong. In the end Chaing's forces fled to Tiawan. Mao wanted to move China from an agrarian economy to a modern industrial society in what was called the Cultural Revolution. During the Mao years an estimated 50 million Chinese people died mostly from starvation as the country tried to survive under the communist government. In 1978 the new leader Deng Xiaoping allowed private individuals a kind of economic freedom called, Reform and Opening Up policy. This started a rapid growth period that was accelerated in 2000 when China was allowed into the World Trade Organization. In 2013 the current president Xi Jinping took over and started to restrict the free market and the country started on a down hill path that continues today. Because of tight government controls and a series of unforced errors China is in a downward spiral. The progress they made caused wages to rise above other countries like Vietnam, Indonesia and Mexico so investors looked to these new areas. China over invested in housing and infrastructure plus excess investments around the world in the Belt and Road policy and they are now unable to recover. Add to this the drastic decline in population and they don't have enough young people to work and consume. China's GDP rose steadily from $200 per capita in 1980 to $12,000 in 2021 but it is now on the decline. To make matters worse the US and other countries are now placing import taxes on Chinese exports and companies are leaving behind trillions in infrastructure as they move away from China. These companies are fearful of Xi's total power over the country as he has changed the constitution to allow him to remain in office for life. The rise and fall coincides with the change in government from communism to a type of free market and back to communism.

News

Now that the dust has settled on the election the furor will subside and people will begin to evaluate what happened. Many observers say the partisanship has never been this bad and the scars will last for years but that is only because people do not remember the past. In the 50's I would go to the library and read the day old issues of the St Louis Post Dispatch and the Chicago Tribune. The same event would seem like two completely separate happenings. The bias was overwhelming. In those times we had kooks who presented all types of what is called today mis or disinformation but not many people knew of these weirdos because the news for most people came from the local newspaper which didn't spend a lot of time on national news or from the 15 minute nightly TV news. The nightly TV news was from three networks and they got their news from the NY Times so everyone basically got the same news. Today things are much different. Those kooks that no one ever heard from are on social media and they have audiences of millions. The bias of people has not changed but the methods of spreading that bias have changed in a big way. This has resulted in many people becoming skeptical of any news and most people are relying on their own common sense to determine what is going on. Polls show a steady decline in trust in the media that was 75% in 1950 and down to 15% today. During this same time period the trust in government has dropped from 80% to 20%. The result is that people figure out what they believe and then search out news outlets that enforce their views. When factual results, such as election, prove the source to be wrong that source is dropped like a hot potato.

Pork

Back in the day Wisconsin Senator William Proxmire used to expose government wasteful pork but no one paid much attention because his audience was limited to a few newspapers. In 1975 he began to issue his Golden Fleece Award which outlined ridiculous spending projects by various congressmen. Others over the years have tried to reign in waste and abuse without much success but to quote Bob Dylan, times are a changin. This time there are two major differences. First off Vivek and Elon are outsiders not directly controlled by the government and second they have social media. Every Golden Fleece they expose will carry with it the name of the congressman who authored it, the money involved and description of the pork. Most pork projects involve smaller sums and can be easily lost in the trillion dollar budget but together can add up to significant amounts hitting $18 billion last year. As hundreds of millions of viewers see these odd expenditures it will bring the attention to how the budget process works. This will give impetus to overhaul the more major aspects of spending.

Trump

Trump domestic policy. Expand fossil fuel production to the maximum, reduce regulations on business, 15% tax rate on companies that produce and sell in the US, no tax on TIPS and overtime, renew the 2017 Trump tax cuts. put pressure in DA's to jail repeat offenders, stop reducing felonies to misdemeanors, secure the border by bringing back remain in Mexico, stopping catch and release, deport all migrants with criminal records along with gang members, and promote reshoring of manufacturing jobs. Longer term. Set up a path to citizenship for migrants in the country. Transfer wind and solar subsidies to nuclear, preferable small thorium reactors, reduce the power of the bureaucracy by exposing corruption and mismanagement, replace gasoline cars and lite trucks with natural gas, encourage healthy life styles by promoting proper nutrition and exercise, transfer education away from the federal government to state and locals and use social media to inform and update all government activities.

China

While the US economy is heavily dependent on consumption, China's economy relies on investments. China kept its GDP growing by building infrastructure with an emphasis on housing. The result is they over built and now are faced with an over abundance of houses and apartments. This is causing the price of real estate to decline. Meanwhile starting about ten years ago China embarked upon a world wide project called Belt and Road Initiative. Using Chinese money, people and construction companies they began building large projects in countries around the world. This was to keep Chinese companies and their employees working. Almost a trillion dollars has been spent on various project to date and many are only partially completed. About 60% of the countries are having difficulty repaying the cost of the projects and many are in default. This is just one more nail in the coffin of the Chinese governments long list of poor management decisions.

Grant

Sylvester Stallone has come out for Trump and critics say its because the theme of masculinity made him think that Rocky fit the bill but it illustrates another point, that being, that actors sometimes confuse themselves with the person they play. This was best exemplified by actor Cary Grant, a person who understood the difference between who he was and the characters he played, when he famously said, everyone wants to be Cary Grant, I want to be Cary Grant. Actors and other celebrities do not seem to have that much influence when it comes to voting.

Germany

China is doing to the German auto industry what they previously did to the US steel industry. They are dumping cheap EV's on the German market. The US will have to come to the rescue of the Germans by ending the war in Ukraine. Prior to the war Germany was getting their natural gas from Russia but that stopped when the war started. The gas they are now importing, mostly from the US, cost four times more and this is having a devastating effect on German industry. Germany chemical giant BASF is closing 11 factories and transferring production to China and the US. Volkswagen, Germany's largest employer is closing 3 of its ten plants because the cost of energy is too high. In the years leading up to the war Germany closed down its nuclear plants and must now rely on old coal plants to keep the country from going under. If the war ends then natural gas from Russia will once again be possible and the disaster can be avoided. The US must act quickly to end the war, not just for the sake of Germany's economy but for the rest of the world.

Waste and fraud

Vivek and Elon have been given the unenviable task of cutting the fat from the federal budget. The budget is $6.74 trillion and 49% of that is in social security, Medicare and Medicaid. Another 14% for interest and 18% for defense which doesn't leave much left for cutting so the big savings will be in more efficient use of funds and reduction in fraud. They can start by cutting pork, those individual expenditures that receive all the negative publicity but then they will have to turn their attention to the the much bigger problem which is the inefficiencies, called waste and fraud, estimated to be one trillion per year. Even if they only partially succeed in cutting the process will make Americans more aware of how poorly the government spends the taxpayers money. This has been tried before without much success but this is the first time businessmen outside of government have had a go at it. We shall see.

RFK

The controversy surrounding the nomination of RFK to head the health agency is raising some needed concerns. He is being criticized because he is not a scientist but he does look at things through the lens of common sense. It doesn't take nutritionist to say that taking a walk everyday, drinking lots of water, getting a good night sleep, not smoking, eating a balanced diet, watching your weight, having a healthy social life, using your talents and life's experience to reach out and help others are some of the many things that come under the heading of common sense. Our whole society is set up to make people dependent on drugs to try and offset negative life styles. To often people end up eating too much sugar, salt and fat and then the gain weight and don't feel like participating in any physical activity so they go to the doctor and get a prescription to make themselves feel better. The food industry gets the game going and the medical business suggests a treatment and the big drug companies are more than happy to sell the drugs. This is a cycle that can be broken with the proper education and leadership. This is what the non scientist RFK will add to the equation. He is not going to get rid of science but add some life styles that will help people before they get sick.

Economy

As the reshoring of America gets into high swing the threat of inflation will come into play. The increase in productivity with the newly built manufacturing plants using AI to partner with workers will offset some of the inflationary pressure. As the economy booms the governments tax collections (revenue) will grow and there will be pressure to start new programs but in order to fight inflation the new income must be used to reduce the cost of existing programs.

Russia

Trump's foreign policy to do list. A peaceful settlement to the Ukraine War by offering Crimea and the Don Boss in return for Russia leaving. Remove all sanctions from Russia and allow natural gas to flow once again to Europe. Return Russian raw materials including minerals and fertilizer to the world market. Russian and Ukraine produce 20% of the world's wheat and this will prevent starvation in Africa. Reopen American businesses in Russia that closed because of the war and bring Russia into the Western markets. Have NATO start a Marshall Plan to rebuild Ukraine using European contractors and Ukrainian labor all financed by Europe. Go all in on support to Israel to quickly defeat Hamas Reignite the Abraham Accords to bring Saudi Arabia on board which will isolate Iran and open the door to peace in Palestine. The oil rich countries in the Middle East will finance the rebuilding of Gaza using Israeli contractors and Palestinian labor. Reinstate the sanctions on Iran reducing their oil exports by 2 million barrels per day as was the case under the last Trump administration. Retain the import taxes on Chinese goods. Export US natural gas to the far Eastern countries like Japan and South Korea.

Germany

The general tariff on autos into the US is 2.5% but there has been a 25% tariff on trucks since 1964. The result is that most foreign trucks sold in the US are made in the US. When a car made in the US is sent to Germany the customer pays a 10% import tax (tariff) plus a 19% value added tax (VAT). Trump is suggesting an increase on auto tariffs from 2.5% to 10 % and the Germans are upset. When Trump ends the Ukraine war this opens the door for Germany to once again get natural gas from Russia and that will do far more for their economy than any import tax on cars will hurt. In fact many agree that this will save the German economy which has been in a recession for the past two years.

Border

For 10 years, I helped people file income tax at the local senior center and many people who did not have a social security number used an individual tax identification number (ITIN). It was somewhat controversial since the law says you cannot work in this country without a SSN. This then allowed people to file tax using the ITIN. This needs to be clarified so that all illegal migrants could use this ITIN to legally work. Once the criminals are removed from the country (deported) the next step is to evaluate those remaining on an individual basis to determine if they can stay in the country. While this is going on the border must be secured. The remain in Mexico policy will be used. This means that while migrants are waiting for the government to asses their claim of asylum they remain in Mexico. Currently the back log is so great that this will take years. The government of Mexico does not want migrants piling up on the Mexico side of the border so they will take steps to close the Guatemala border. This will prevent these people from making the dangerous journey across the Mexican desert. It will reduce the number trafficked by the cartels and will slow down the illegal drug drug business. Next the catch and release program will be change to catch and deport. These changes will let the world know that coming to America illegally by crossing the southern border is no longer viable.

NY City

NY City became a sanctuary city under the guiding hand of liberal Mayor Bill de Blasio in 2017. A sanctuary city has rules which bar them from cooperating with Immigration and Customs Enforcement (ICE). This is a public declaration which shows how compassionate the people are as represented by the inscription written on the famous stature in NY harbor which says in part, give me your tired, your poor, your huddled masses yearning to breathe free. This in today's vernacular goes by the uncomplimentary phrase, virtue signaling. So far so good. Then over a 2 year period Texas sent 250,000 migrants to NY City as a part of the 200,000 that were coming into Texas each month and the patience of the residence of NY City were tested. NY City is spending $1.5 billion per year to care for migrants including providing 16,532 hotel rooms. Besides housing, the migrants get food stamps, financial assistance and free childcare. Migrant crimes now represent 75% of the arrest and are clogging up the courts. Mayor Adams has asked the federal government for help because the citizens of NY City are not happy. Similar situations have developed in other cities like Chicago.

ICE

Trump announced that Tom Homan will be director of US Immigration and Customs Enforcement (ICE). He served in this position during the Obama administration during which time 3 million illegals were deported by Obama who was known as the Deporter in Chief. Homan stayed on for the first two years of the Trump administration and during those 10 years border crossing were less than 40,000 per month and they stayed at that number until Biden was elected. For some reason, hard to understand, Biden imminently dispensed with all the rules and the migrant numbers rose to over 200,000 per month and is still that way. Homan resigned because he wanted to spend more time with his family but he is now ready to come back. During these past four years thousands of young girls and women have been molested crossing the Mexico desert while over 300,000 young Americans died from fentenyl and the cartels made billions trafficking including 320,000 unaccompanied children who have been lost. When the new president of Mexico Claudia Sheinbaum hears this news she will take steps to close her border with Guatemala realizing that migrants will no longer be crossing into the US and will pile up on the Mexico/US border. Homan will quickly start rounding up all of the convicted felons and sending them back. He will re institute the remain in Mexico policy which was in effect during his last tenor. He will change catch and released to catch and deport. He will begin building the wall. Migrants round the world will know there is new sheriff in town and the caravans will stop. Next he will go through the remaining migrants who are here illegally and determine their status based on several criteria. Many hope that the congress will allow those with ITIN's to be eligible for work permits which will in time lead to green cards.

Europe

Europe is concerned that Trump will upset the balance of trade with the US and they should be upset. U.S. goods and services trade with the European Union totaled an estimated $1.3 trillion in 2022. Exports were $592.0 billion; imports were $723.3 billion. The U.S. goods and services trade deficit with the European Union was $131.3 billion in 2022. This has been going on for 40 years. One example. There are very few America cars in Germany where US imports are heavily taxed. The same can be said for other countries and other products. Add to that the fact that the US has been the military defense for Europe allowing them to use defense money for their national health insurance and their retirement plans. They don't want Trump upending the good deal they have but that may change with the onset of the Ukraine war. The cut off of cheap energy (gas and oil) from Russia has caused severe hardship throughout Europe with Germany in the middle of a two year recession. If Trump ends the war and opens up Russian energy to Europe they will be happy as will the people of Africa who are going hungry because of the war.

Workers

Some democrats are saying they were surprised by the loss of blue collar workers but not all were. Here is quote from Schumer in July of 2016 At least publicly, Schumer has no worries about his party’s dwindling fortunes among working-class white voters. “For every blue-collar Democrat we lose in western Pennsylvania, we will pick up two moderate Republicans in the suburbs in Philadelphia, and you can repeat that in Ohio and Illinois and Wisconsin.” He was apparently aware of the trend but not concerned. Note that he said this in the summer before the election.

Voters

I am still baffled by the number of votes that Biden got in 2020 vs the 2016 and 2024 2016 Trump 63 million and Clinton 66 million 2020 Trump 74 million and Biden 81 million 2024 Trump 73 million and Harris 68 million I first explained this by assuming that the democrats just stayed home in 2016 and 2024 but another possibility is since Trump ran against women in 2016 and 2024 perhaps the democrats were misogynist. What other possibilities are there for 13 to 15 million voters to disappear. Someone suggested likability. In 2016 polls showed 24% viewed Trump favorable and 57% unfavorable. For Clinton it was 31% favorable and 52% unfavorable. Not likely the answer.

Grid

Data centers are being built at a record pace with the big tech companies leading the way. The grid is already stressed and these new centers are worsening the problem. Now without seemingly understanding the problem many people think the electric cars are coming. This means using the grid instead of gasoline for our daily transportation. Even if people wanted an EV they would not be able to charge their car or truck.

Education

One of the many questions regarding the upcoming Trump administration revolves around the Department of Education. When this department started in 1980 one of its purposes was to stop the practice of diverting funds from Black schools to White schools. It was a noble purpose and for the most part succeeded. The Department only represents 10% of the school budget but controls other aspects of schools by threatening to withhold the ten percent. Outright spending difference have mostly been eliminated with the exception being the reliance on property tax for funding. The federal government has nothing to do with as this is a state thing. In areas where the property tax revenues are higher then the money available for schools is higher. This is a relatively small amount since the State pays for 86% of K-12 education cost, not including federal funds. Data shows that the state wide average per pupil cost in MN is $15,000 while the St Paul schools spend $20,000. The original purpose of the Department of Education was to remove any discrepancies regarding the funding of Black schools vs White and that has been accomplished. As far as improving education the department has tried unsuccessfully. With experiments like No Child Left Behind, Race to the Top and Every Child Succeeds the department confused both teachers and students. There has been little improvement in test scores since 1980 and the gap between White and minority students continues to widen. Perhaps the department has outlined its usefulness.

Students

As the country moves toward expanding the industrial base, employers will be hiring high school graduates and offering them on the job training. From an academic standpoint they want students who can read and write, more specifically to read a ten page essay and write a one page summery. This is what 90% of high school classes are all about. You read and write down what you read. On the other side are social skills. The want students who can fit in and compliment one another to form a cohesive work group. These students will operate systems with the aid of AI which means higher productivity which means higher wages. Just as they have learned to use their computers and phones they will be comfortable with operating high tech machines.

Head Start

A a part of the Great Society the government began the Head Start and Early Head Start programs. Head Start is for children ages 3 to 5 and Early Head Start is for children birth to age 3. These are federally funded government childcare programs. Studies show an early improvement in academic achievement but it fades as the child gets older. A large study was completed in 2008 and showed some positive results but the study came under scrutiny when it was discovered that instead of the participants being chosen randomly they were selected by teachers in the program. Regardless of the academic effectiveness, the program does provide baby sitting for low income families. Most programs are 6 hours and this gives a break to single working moms. It cost $12,000 per year per student which is comparable to $15,000 per year for other public school students. The program serves 1.1 million mostly minority children 37% Hispanic and 29% Black. If the program were expanded to a full school day the biggest beneficiaries would be single working moms. Parents whose children do not qualify for free childcare spend on average $12,000 per year per child which is what Head Start cost.

News

The Harris campaign spent $1.37 billion and Trump spent $914 million. This follows the 2016 election where Clinton spent $1.2 billion and Trump spent $600 million. It was said that money is the mothers milk of politics but that was not the case in these two presidential elections. The other thing called into question is the press. The stats show that the major TV networks and major newspaper were lopsided in their reporting with Trump getting 85% negative and Biden/Harris getting 78% positive. From this, many conclude that legacy media is no longer a force in determining election results. This is not that surprising considering trust in journalism and declined over the years and fewer people are getting their political news from these sources. Social media is the place most people go to and this is particularly apt for younger people. It is expected that this trend will continue.

War

In early 1965 the US sent civilian contractors to Vietnam. The United States has sent contractors to Vietnam for a variety of reasons, including to build infrastructure, to provide humanitarian assistance, and to support the military Here is a news item from yesterday The Biden administration will allow U.S. military contractors to deploy to Ukraine — a policy reversal aimed at helping Kyiv maintain complex Western-provided weapons systems, a defense official told POLITICO. These are Americans who are teaching Ukrainians how to use weapons to kill Russians. Through 1966 the military and political landscape was flooded with complications. From the first few U.S. military advisers Eisenhower had sent to Vietnam in early 1955 Is this more mission creep.

Trump

I see two categories for Trump. First are the things that will probably be on Trumps agenda which are securing the border, renewing the Trump tax cuts, keeping tariffs and reducing regs to help reshoring, installing a 15% tax on companies that make and sell in the US, maximize fossil fuel production, expose the new green deal as more of a social program than climate plan, remove the tax on TIPS and overtime, pushing DA's to put repeat criminals in jail, bringing back bonding and stop the reduction of felonies to misdemeanors, re installing the sanctions on Iran, restart the Abraham Accords, offering maximum support to Israel and a peaceful solution to the Ukraine war. This is a pro growth agenda but it will cause inflation unless the productivity increases in the newly built manufacturing plants off set. Second is my wish list for Trump. He should encourage nuclear, in particular small thorium reactors, to fight climate change, he should offer the EV's cash incentives for natural gas cars and trucks. The average life of a car is 12 years so it will take that long to replace most.

Ukriane

Trump has pledged to seek a peaceful settlement to the Ukraine war. He will try to have sit down with Zelenskyy and Putin but not together. First he will meet with Zelenskyy and say if you don't agree to a settlement the US will no longer offer assistance. The he will meet with Putin and offer settlement options. If Putin refuses the US will send what ever is needed to assure that Russia loses the war. If he agrees the war will end with Putin keeping Crimea and the Donbas region. He will bring his troops home a winner. Then NATO with begin the process of rebuilding Ukraine like the Marshall Plan when the US rebuilt Germany. The US will bring Russia into the West using trade and technical help. The gas pipeline to Europe will reopen and Germany will be able to save its economy. Russian and Ukraine exports will reopen and grain will get to the people in Africa before they starve.

Bureaucracy

The 1984 Chevron Case was overturned and set the stage to rein in the power of the bureaucracy. The Supreme Court on Friday overturned a 40-year-old precedent that has been a target of the right because it is seen as bolstering the power of “deep state” bureaucrats. The case stated that if the law is not clear the regulatory agencies can interpret. This gave too much power to the agencies and they used this power to gain control. Politicians often run for office with the promise to pay for their new programs by reducing the fat in government. Trump can use Musk as an outside consultant to review how these agencies operate and recommend changes. This will put the power back in the hands of the people's elected officials (congress) instead of these un-elected bureaucrats. How Musk dealt with Twitter when he took over is a start.

Immigrants

The subject of how to deal with the millions of illegal immigrants is once again in the news. The first step is to deport all of those with criminal records. If their countries refuses to take them back then the US will cut ties with that country. This should be enough to change their minds. If not then these people will be sent to jail for a time depending on the crime. The next step is to change the individual tax identification number (ITIN) card to allow the person to work. These people will be asked to come forward to their local government office to get the card. At that time they will be told that after five years on this card they will be eligible for a green card. After five years with the green card they will be able to apply for citizenship with the understanding they meet the requirement for citizenship which includes proficiency in English. The ITIN cards will be issued to the immigrants based on their time in the country with the longest time being the first to qualify. Meanwhile the border should be closed until the government catches up. Another part of the plan includes raising the number of legal immigrants from 650,000 to two million per year from Europe, Asia and Africa. These people will be chosen by their education and job skills and selected based on the needs of the country.

Rare earths

A recent discovery of rare earth metals in Wyoming could supply all of the US needs for many years. To take advantage of this the country must not only mine the ore but must process and refine the ore and set up recycling and a safe way to dispose of the used products. Once the metals are being produced they must allocated by priority. They must be used for electronics like computers and phones and for defense and not for wind and solar and EV's. Wind and solar will be replaced by small nuclear reactors and EV's first by changing out gasoline cars to natural gas cars and the $7,500 subsidy for EV's should be applied to natural gas cars. This will have the same positive effect on climate change that replacing coal with natural gas did on power plants. These changes can begin immediately.

Votes

There is a lot of talk about the election but one thing that is puzzling that no one has brought up is the total votes. 2016 Trump 63 million and Clinton 66 million 2020 Trump 74 million and Biden 81 million 2024 Trump 73 million and Harris 68 million How did the democratic vote count drop from 81 million to 68 million in just four years. It seems that the former Biden voters did not vote for Trump but chose to stay home.

Gas

There are 23 million vehicles running on natural gas throughout the world but only 175,000 in the USA Natural gas is very clean and the only byproducts are carbon dioxide. Burning gasoline creates harmful byproducts like nitrogen dioxide (causes acid rain) carbon monoxide (poisonous) and benzene, and formaldehyde both are carcinogens. In addition natural gas produces 23% less carbon dioxide. The cost of natural gas in cars is about half the price of gasoline and it runs cleaner meaning less wear and tear on the engine. Switching to natural gas for all cars and light trucks could be done quickly and cost effectively and would be an good interim step while moving away from fossil fuels. The US is current emitting the same amount of CO2 it did in 1984 while the population has increased from 235 million to 335 million. Much of this was do to replacing coal in power plants with natural gas and the same kind of reduction could happen if cars and light trucks switched to natural gas. The up front cost for a car running on natural gas is higher but with volume this difference would be negligible. The average car stays on the road for 12 years so it would take than long to replace most of the cars. An added benefit is that fuel could be added at home if the home uses natural gas for heating.

Abortion

In today's world young fathers are expected to share in raising children meaning spending time with kids, cooking and house cleaning which is good for their character development as well as helpful. 85% of abortions are because the mother is stressed either emotionally or financially or both. Let's assume that Mom comes and tells Dad that she is expecting. Is it appropriate for Dad to suggest abortion saying he is not emotionally ready to be a father. Let's say Dad is just starting a new business and he has neither the time or the money to bring a new baby into the world. Is an abortion an acceptable solution. These are questions no one seems to ask.

Trump

Now that the election is finally over the big question is what will a second Trump administration look like and the short answer is that it will be much like his first term. On the domestic front he will extend the 2017 tax cuts. He will continue the tariffs on China. He will support reshoring by reducing regulation and offer tax incentives for business operating in the US. He will secure the border by forcing Mexico to close the Guatemala border, by re instituting remain in Mexico, stop catch and release and build the wall. He will deport illegals starting with the convicted felons. He will be strong on law and order and encourage states to end no bail, jail repeat offenders and stop reducing felonies to misdemeanors. He will maximize fossil fuel. On foreign policy he will bring back the sanctions on Iran. He will revitalize the Abraham Accords to bring in Saudi Arabia to join the other Arab countries. He will seek a peaceful settlement to the Ukraine War. He will offer a full commitment to Israel. He will continue to encourage NATO countries to build up their defenses.

Sputnik

China now has the first fully operational thorium molten salt reactor. It is producing 40 MW of power. This could be the Chinese version of the Russian Sputnick. Recall in 1957 when Russia launched the first satellite into space called Sputnik it awakened the sleeping giant USA and started the space race. Maybe now the US will wake up and fast track a program to build small nuclear reactors. This may get the attention of the politicians.

War

When Russia invaded Ukraine, people said it was just the first step for Putin to rebuild the old Soviet Union. They recall in 2005 he said, "the biggest geopolitical catastrophe of the century" was the collapse of the USSR. This is what led people in the West to believe that if he got past Ukraine he would then move on to other countries. This was a reasonable assumption at the time but all good managers are willing to reconsider their positions when new information becomes available. Over the past two years the total ineptness of the Russian war machine has been exposed to the world and the war has cost them dearly in both lives and treasure. Many, looking at the situation today, realize that Russia is not capable of challenging a US led NATO by invading other neighboring countries. As time passes this reality is becoming more evident and the time has arrived for a peaceful settlement. To continue the war just increases the chances that Putin will be forced to use nukes to safe face. Protesters are demanding a cease fire in GAZA, how about the same for Ukraine.

Abortion

The abortion issue has not become the big deal that many democrats thought it would be. One of the reasons is Trump's position. He says abortion should be legal up to 15 weeks with exceptions for rape, incest and life of the mother. Trump also stated that he would not support a national ban on abortion. This is a more popular position than Harris who believes abortion should be legal at any time for any reason. Most people know there is something uncomfortable about abortion. This was exemplified when Bill Clinton said, abortion should be safe, rare and legal. He used the word rare indicating his feeling that it should be avoided when possible. Most women who have an abortions say it was a difficult decision and many experience emotional problems afterwards. This is not to say they should not have had an abortion but that it is something that they wish they hadn't had to deal with.

China

The upside to gridlock may sound like a oxymoron but the case of the Chinese economy clarifies the statement. Getting things done in the US is difficult because the constitution guarantees the separation of powers which means the president cannot act without help from the congress. In China Xi is an authoritarian who can quickly change the entire government. He has eliminated any contenders to power and is thus left standing alone to run the country. There is no one willing to challenge any of his dictates and through a series of bad decisions he has sent the country into a downward spiral. At first the labor cost in China was low enough that foreign companies were willing to put up with the countries irrational decisions but in time they discovered that it was not worthwhile. The use of slave labor and unsafe working conditions began to cause concern by foreign businesses operating in China and his demand that all companies share proprietary information made them uncomfortable. Then China's internal economy began to suffer because of government's almost free money to expand construction which led to a housing bubble and high youth unemployment. This was further aggravated by the now infamous one child policy and foreigners are leaving and taking their business elsewhere. Then Trump placed import taxes on Chinese goods and Xi clamped down on foreign companies and the result is that China is in danger of collapse. The US is in the process of reshoring but it takes time to build new factories and if China falls before the US can replace their imports it will cause serious problems in the US. If the US build up coincides nicely with the Chinese build down, some say it would be providential in the spiritual sense.

Grid

As part of the Infrastructure bill the government set aside $7.5 billion to build EV charging stations but only a hand full have been built to date. The reason for this lack of progress in not a surprise and could have been predicted years ago. The cost of a charging station and the location to place one is not a problem. The problem results from the fact that there is no power available at most sites along the grid. When people talked about the short comings of EV's they concentrated on charging time and distance traveled between charges but they never talked about the inability of the grid to support the power. This was well known by the experts but the excitement over EV's just overwhelmed their common sense. The big new kid on the block is AI and it faces the same shortage of power so many companies are trying to set up their own private electric power stations.

Reshoring

Reshoring is the big word in today's world and it means bringing jobs back home. From 1970 until 2010 the US transferred 7 million manufacturing jobs overseas mostly to China. This was a business boom for US companies but a disaster for factory workers. The CEO's saw their salaries sky rocket at the expense of factory jobs. Politicians, who publicly championed the workers, sat silently while these jobs disappeared. This problem was brought to the attention of the public by Trump who even before he decided to run for office complained about China's unfair trade practices which accelerated in 2001 when China was allowed into the World Trade Organization. Trump being a real estate developer was well aware of the methods that China used to gain advantage. Once in office Trump trumpeted his concerns which led to the passage of USMCA a free trade agreement between the US, Mexico and Canada. In 2010 only 5,200 manufacturing jobs were reshored but by 2014 that number rose to 95,000 and 150,000 by 2020. In 2021 that number increased to 240,000 and 360,000 by 2022. These figures continue to rise and were spurred on by the passage of the Inflation Reduction Act and the Chips Act. Many Asian companies are building in Mexico to escape import taxes and Mexico will be the fastest growing economy over the next ten years. As the US industrial economy doubles in the next ten years the more skilled jobs will be in the US and the lower skilled jobs in Mexico.

Income gap

Here is a bit if facetious blabber to illustrate a point. The government recognizing that the cost of healthcare rises precipitously after age 75 has decided to end these cost and pass on the savings to low income families. There are 10 million households that earn less than $40,000 per year and the savings in Medicare cost would be $600 billion so each household would receive $60,000. This is in line with government policies designed to close the income gap. These older folks have had a good long life and the younger families need assistance just to make ends meet. Many of these elderly people have a poor quality of life and many are not even aware of what's going on. It could be seen as a blessing. As a side benefit this would take care of the shortage in the social security fund. We could kill two birds with one stone. That is good planning.

Obamacare

One of the selling points for Obamacare, was that it got rid of the preexisting conditions clause in insurance policies. During WW 2 inflation was rising rapidly and FDR froze wages. Companies could no longer compete for the best employees with wages so they offered health insurance as an incentive. This led to company sponsored healthcare as a regular part of the employment contract. This benefit was continued after the war because congress declared the cost of healthcare to the company was tax deductible. This led to a problem. If a person got sick and lost their job they lost their health insurance and because they were sick they could not get new health insurance. They could continue with their plan after leaving the company but they had to pay the full cost and with being out of work this posed a big problem. With Obamacare this problem was solved. Many people choose not to purchase health insurance until they get sick and then they sign up for Obamacare. There is a danger here because you can only purchase Obamacare during special enrollment times which occur about 3 months out of the year but many still have no choice. But! You qualify for special enrollment times if you lose your health coverage (had to quit because you were sick) or because of moving, getting married, having a baby. Postponing the purchase of healthcare by healthy people should have been anticipated but it was ignored to promote the passage of Obamacare and since then the cost have risen above projections. The healthy people were to purchase Obamacare and help spread the cost but they chose instead to wait until they got sick and thus negatively effected the cost. Today there are 27 million people without health insurance and they are mostly low income minorities. They will attempt to get insurance when they get sick. Just five years ago, annual spending on Obamacare subsidies was $57 billion. In 2024, annual spending on Obamacare subsidies is projected to more than double to $125 billion.Jun 24, 2024

Trump

The dislike of Trump so dominates the thinking of many democrats that they pay little attention to his policies. The cold war ended with the demise of the Soviet Union in 1990 and the country had time to look around to see what was going on and they discovered globalization. Most people were not familiar with that term until Trump started talking about it a few years before he announced his first bid for the presidency. In 2015 the phrase gained some interest as Trump started complaining about China's unfair trade practices and how he would put a stop to it if elected but it still didn't register with the press because they didn't know what it meant. The people who were mostly effected by China's practices were the millions of hourly employees who lost their jobs as industry moved overseas. They had been experiencing the negative effects of globalization for 30 years but they didn't know what it was called. Trump, as a real estate developer, had a close working knowledge of what the trades people had been subjected to and quickly sized up the opportunity to come to their rescue. Today, Trumps base is largely composed of hourly paid tradesmen who used to be democrats. Trump has been and continues to be the leading voice in the push for reshoring our former manufacturing businesses. Globalization is now underway and there is no going back. Regardless of who is elected, the reigniting of Americas industrial base is alive and growing. This will be an economic boom over the next ten to fifteen years as good paying jobs for high school grads will become common place. In years ahead when looking back this will be Trumps big achievement.

Nuclear

The first nuclear reactor was developed in Tennessee at the Oak Ridge National Lab in the 1960's. It was a molten salt reactor using thorium as a fuel source. The thorium which is not fissile was activated by Uranium 233. It ran for 13,000 hours at full power at 7.4 MW. It operated at 1,200 degree F and used hot air to drive the turbine. The experiment was consider a success and recently small nuclear reactors are making a come back in the attempt to become carbon free. Later thorium was abandoned and replaced with uranium because the government needed plutonium for bombs and getting bomb material from thorium was too difficult. Experiments using small reactors are underway in several countries to move to carbon free energy.

Gap

Many people are concerned about the growing gap in wealth and income throughout the world and in particular in the United States. Whether you are rich or poor there is only four things you can do with your after tax money. You can save it, spend it, invest it or give it away. If you are poor you mostly spend and if you are rich you mostly invest. To save means to buy treasuries, money market certificates or certificates of deposit (CD's). If you invest it is mostly in stocks, bonds and or real estate. The government gets most of its money from individual and corporate income tax. The government spends all of its money and then some since it has been many years since any revenue was applied to the debt. The government invests some in the form of subsidies and research and development but most of the government money goes toward public assistance, primarily Medicare, Medicaid and social security. The rest goes mostly to defense and interest on the debt. This reveals that tax policy is not so much economic policy but rather social policy. How much money should the government take from one group and give to another group. Here is one example to illustrate the gap. The average income of the bottom 20% is $28,000 and the top one percent is $820,000. The bottom 20% have $4 trillion in wealth and the top one percent has $36 trillion. There are many things besides taxes that can be used to narrow this gap.