- German Leftists Push Bill To Make "Working From Home" A Legal Right
German Leftists Push Bill To Make “Working From Home” A Legal Right
Tyler Durden
Fri, 10/02/2020 – 02:45In an interview with the FT, German Labor Minister Hubertus Heil, a Social Democrat MP and author of a bill granting new legal rights to workers who wish to work from home permanently, said that his bill would be published in a few weeks, marking an important step on its way to becoming a law.
The law would be a landmark piece of legislation as Germany would become the first major European economy to give employees ‘the right to work from home’.
Heil insisted that the still-unpublished law would find other ways to to reinforce workers rights and set clearer boundaries for lives that no longer have the traditional separation between “home” and “office”. It also aims to offset some of the negative impact on collective bargaining and labor organizing.
“We cannot stop the changes in the world of work, nor do we want to,” he said. “The question is how we can turn technological progress, new business models and higher productivity into progress not only for a few, but for many people. How do we turn technological progress into social progress?”
Germany isn’t the only European country grappling with these issues. However, other countries have mostly relied on existing laws. France is relying on a 2017 law that limits work-related calls and emails after work hours.
If it passes, the law would be part of a “wider rethink” on Germany’s stolid economy prompted by the virus. Once seen as opposed to “flexible” work schedules, Germans have embraced WFH en masse since the start of the pandemic, and they’ve found that they actually rather quite enjoy it.
The virus has also forced Berlin to abandon its longstanding tradition of passing only balanced budgets – the “black zero”, as the rule is known. Meanwhile, Germany expanded the Kurzarbeit, its short-term unemployment insurance scheme, to help support workers in industries that have been shuttered by the virus.
A WFH law was first announced back in June, and it’s still unclear whether it will find support among Angela Merkel’s Christian Democrats – the CDU – as many small business owners complain that the legislation is unnecessary.
Ingo Kramer, the president of the German Employers’ Association, has called the proposals “utter nonsense” and warned they would encourage German companies to outsource jobs to cheaper workers abroad.
However, even the law’s backers concede that there are certain gender disparities that the law can’t address.
“There is the cliché, which is unfortunately often true, that men go into their home office and close the door while women working from home are simultaneously taking care of children,” he said.
If nothing else, the draft proposal is simply the latest example of how the virus has pushed Germany’s famously tight-fisted government to embrace more spending on the social safety net. But is this all a ruse to further strengthen the power of Germany’s unions by strengthening collective bargaining rights?
- Gates, Kissinger, And Our Dystopian Future
Gates, Kissinger, And Our Dystopian Future
Tyler Durden
Fri, 10/02/2020 – 02:00“The further a society drifts from the truth, the more it will hate those who speak it.”
– George Orwell
Can we agree that there are two types of Covid-19?
The first type, is Covid-19 ,”The Virus”, which is a fairly mild infection that most people don’t even realize they’ve contracted. They remain either asymptomatic or have slight flu-like symptoms that go away after a week or so. A tiny sliver of the population– that are mainly-older, vulnerable people with underlying health conditions– can develop complications, become seriously ill and die. But, according to most analysis, the chances of dying from Covid are roughly between 1 in every 200 to 1 in every 1,000 people. (CDC-IFR- 0.26%) In other words, Covid is not the Spanish Flu, not the Black Plague and the Genocidal Planetary Killer Virus it was cracked up to be. It kills more people than the annual influenza, but not significantly more.
The second type of Covid-19, is Covid “The Political Contrivance” or, rather, CODENAME: Operation Virus Identification 20 19. This iteration of the Covid phenom relates to the manner in which a modestly-lethal respiratory pathogen has been inflated into a perennial public health crisis in order to implement economic and societal changes that would otherwise be impossible. This is the political side of Covid, which is much more difficult to define since it relates to the ambiguous agenda of powerful elites who are using the infection to conceal their real intentions. Many critics believe that Covid is a vehicle the Davos Crowd is using to launch their authoritarian New World Order. Others think it has more to do with Climate Change, that is, rather than build consensus among the world leaders for mandatory carbon reductions, global mandarins have simply imposed lockdowns that sharply reduce economic activity across-the-board. This, in fact, has lowered emissions significantly, but at great cost to most of humanity. Covid restrictions have triggered a sharp uptick in suicides, clinical depression, child abuse, domestic violence, alcoholism and drug abuse. The list goes on and on. Also, it has left economies everywhere in a shambles, increasing unemployment and homelessness exponentially, while setting the stage for massive famines in undeveloped countries around the world. Even so, key players in the Covid crisis– like mastermind Bill Gates– continue to marvel at impact these onerous restrictions have had on emissions. Take a look at this excerpt from a recent post at the Microsoft founder’s blog:
“You may have seen projections that, because economic activity has slowed down so much, the world will emit fewer greenhouse gases this year than last year. Although these projections are certainly true, their importance for the fight against climate change has been overstated.
Analysts disagree about how much emissions will go down this year, but the International Energy Agency puts the reduction around 8 percent. In real terms, that means we will release the equivalent of around 47 billion tons of carbon, instead of 51 billion.
That’s a meaningful reduction, and we would be in great shape if we could continue that rate of decrease every year. Unfortunately, we can’t.
Consider what it’s taking to achieve this 8 percent reduction. More than 600,000 people have died, and tens of millions are out of work. This April, car traffic was half what it was in April 2019. For months, air traffic virtually came to a halt.
To put it mildly, this is not a situation that anyone would want to continue. And yet we are still on track to emit 92 percent as much carbon as we did last year. What’s remarkable is not how much emissions will go down because of the pandemic, but how little.
In addition, these reductions are being achieved at, literally, the greatest possible cost.
To see why, let’s look at what it costs to avert a single ton of greenhouse gases. This figure—the cost per ton of carbon averted—is a tool that economists use to compare the expense of different carbon-reduction strategies. For example, if you have a technology that costs $1 million, and using it lets you avert the release of 10,000 tons of gas, you’re paying $100 per ton of carbon averted. In reality, $100 per ton would still be pretty expensive. But many economists think this price reflects the true cost of greenhouse gases to society, and it also happens to be a memorable round number that makes a good benchmark for discussions.
Now let’s treat the shutdown caused by COVID-19 as if it were a carbon-reduction strategy. Has closing off major parts of the economy avoided emissions at anything close to $100 per ton?
No. In the United States, according to data from the Rhodium Group, it comes to between $3,200 and $5,400 per ton. In the European Union, it’s roughly the same amount. In other words, the shutdown is reducing emissions at a cost between 32 and 54 times the $100 per ton that economists consider a reasonable price.
If you want to understand the kind of damage that climate change will inflict, look at COVID-19 and spread the pain out over a much longer period of time. The loss of life and economic misery caused by this pandemic are on par with what will happen regularly if we do not eliminate the world’s carbon emissions.” (“COVID-19 is awful. Climate change could be worse“, Gates Notes)
Isn’t it curious that Gates has spent so much time calculating the impact lockdowns have had on carbon emissions? And look at how precise his calculations are. These are not “back of the envelop” type computations, but a serious bit of number-crunching. He even takes the number of people who have died of Covid worldwide (600,000) and painstakingly compares it to the projected “global mortality rates” (“on an annualized basis”) of people who will die from “increases in global temperatures”.
Does it seem to you that Gates might have more than a passing interest in these estimations?? Does it look like he might be more than just a neutral observer impartially perusing the data?
Let me pose a theory here: In my opinion, Gates’ interest in these matters is not merely speculative curiosity. He and his fellow elites are conducting an elaborate science experiment in which we– mere mortals– are the lab rats. They are deliberately using the Covid-scare to conceal their real objective which is to prove beyond a doubt that curtailing emissions by shutting down vast swathes of the global economy will NOT stave off catastrophic climate change.
So, let’s just assume for the sake of argument that I’m right. Let’s assume that other elites read Gates report and agree with its conclusions. Then what?
This is where it gets interesting, because Gates doesn’t really answer that question, but his silence gives him away.
Let me explain: Gates says, “The relatively small decline in emissions this year makes one thing clear: We cannot get to zero emissions simply—or even mostly—by flying and driving less.”
Okay, so we cannot stop climate change by doing what we are doing now.
Then Gates says: “Let science and innovation lead the way….Any comprehensive response to climate change will have to tap into many different disciplines…. we’ll need biology, chemistry, physics, political science, economics, engineering, and other sciences.”
Right again, we’ll follow the science.
Gates then says: “It will take decades to develop and deploy all the clean-energy inventions we need.”
Okay, so we have to move fast to avoid tragedy.
Finally, Gates says: “Health advocates said for years that a pandemic was virtually inevitable. The world did not do enough to prepare, and now we are trying to make up for lost time. This is a cautionary tale for climate change, and it points us toward a better approach.”
Got that? So, on the one hand, Gates is saying ‘We must act fast and follow the science’, and on the other he is saying, ‘Shutting down the economy alone isn’t going to work.’
WTF? If it’s not going to work, then why bother? Why is Gates sending a mixed message?
Ahh, but there’s the rub. It’s not a mixed message and it is not a contradiction. What Gates is doing is leading the reader to draw the same conclusion that he has, (wink, wink) that is, if reducing economic activity isn’t going to work, then we have to find an entirely different solution, like reducing the size of the population. Isn’t that the only logical conclusion?
Yes, it is. So, the Great Lab Experiment of 2020 (Covid) has alot to do with population control; thinning the herd so our exalted Davos Overlords can ensure their blue-blooded offspring will have mild temps when they winter-over on their private islands in the Caribbean. But population control is just a small part of a much more ambitious plan to restructure the global economy, vaccinate everyone on the planet and dispose of those niggling civil liberties to which Americans have become so attached.
The elitist strategy has been dubbed the “Great Reset” which refers to the World Economic Forum’s Covid Action Platform, a program that aims at restructuring “economic and social foundations” in a way that best suits the interests of “stakeholder” capitalists. Here’s a clip from their press release:
“COVID-19 lockdowns may be gradually easing, but anxiety about the world’s social and economic prospects is only intensifying. There is good reason to worry: a sharp economic downturn has already begun, and we could be facing the worst depression since the 1930s. But, while this outcome is likely, it is not unavoidable.
To achieve a better outcome, the world must act jointly and swiftly to revamp all aspects of our societies and economies, from education to social contracts and working conditions. Every country, from the United States to China, must participate, and every industry, from oil and gas to tech, must be transformed. In short, we need a “Great Reset” of capitalism…
The level of cooperation and ambition this implies is unprecedented. But it is not some impossible dream. In fact, one silver lining of the pandemic is that it has shown how quickly we can make radical changes to our lifestyles. Almost instantly, the crisis forced businesses and individuals to abandon practices long claimed to be essential, from frequent air travel to working in an office….
Clearly, the will to build a better society does exist. We must use it to secure the Great Reset that we so badly need. That will require stronger and more effective governments, though this does not imply an ideological push for bigger ones. And it will demand private-sector engagement every step of the way.” (“The World Economic Forum’s Covid Action Platform“, WEF)
If it sounds like our illustrious leaders want to remake society from the ground-up, it’s because that’s exactly what they have in mind. And they’re not even trying to hide their real intentions. They say quite bluntly: “the world must act jointly and swiftly to revamp all aspects of our societies and economies, from education to social contracts and working conditions.”
That sounds alot like marching orders to me and, indeed, that’s exactly what they are; orders.
But how do they intend to affect these dramatic and revolutionary changes?
Why Covid, of course. They’re going to use Covid to make fundamental changes to the existing system, including accelerating privatization (“stakeholder capitalism”), merging governments into a unified global regime, intensifying the elements of social control (via mass electronic surveillance, intrusive contact tracing, security checkpoints, lockdowns, internal passports, biometric IDs etc) and taking whatever steps are required to introduce a tyrannical Brave New World.
It’s all there in black and white, they’re not even trying to hide it. In their own words, the “Great Reset” depends on the Covid Action Platform, right? In order to “build a better society” we need to “make radical changes to our lifestyles” including reductions in “frequent air travel to working in an office”. So just forget that trip to Italy next year Mr. and Mrs. WorkerBee. Ain’t gonna happen. Bill Gates says, “No.” And get used to working from home, too, because we don’t want your dog-eared Capri spewing carbon into our pristine-blue skies.
The statement also makes clear that the obliteration of millions of jobs and small businesses was not an accidental casualty of the Covid lockdowns, but the planned demolition of business and workers these Mucky-mucks consider ‘non-essential’.
And as far as who will participate in this new blueprint for Capitalist Valhalla? Well, everyone of course. According to the authors: “Every country, from the United States to China, must participate, and every industry, from oil and gas to tech, must be transformed.”
There it is from the horse’s mouth: The glorious Biosecurity Slave State is emerging right before our very eyes and we just thought we were in another Great Depression rounded off with a pandemic.
So, when we talk about Covid the “Political Contrivance”, we’re actually referring to the vehicle that elites have settled on to transition the country from its present condition to a full-blown “lock-down” police state. Covid is the smokescreen that’s being used to conceal the maneuverings of filthy-rich powerbrokers who want to implement their Grand Plan for humanity. So, if everything feels chaotic and upside-down at the present time, don’t be alarmed; it’s all by design. The more muddled and turbulent the world becomes, the easier it is to get people to submit to moronic activities like wearing a diaper on your mouth every time you leave the house or standing 6 feet apart at the grocery store so invisible pathogens don’t climb up your pant-leg and bite you. Psychologists know that –in a topsy-turvy world where uncertainty prevails — people are more apt to follow the directives of affable blockheads, like Tony Fauci, even though they may be abandoning their last-claim to personal freedom in the process.
Looking back to April of 2020, we probably should have anticipated where all this was headed, after all, Mr. NWO himself, Henry Kissinger, announced what to expect in an op-ed he posted in the Wall Street Journal. Here’s what he said:
“The reality is the world will never be the same after the coronavirus. To argue now about the past only makes it harder to do what has to be done…”(NOTE– Is Kissinger clairvoyant? How did he know the “world would never be the same again”?)
“Enlightenment thinkers (argued) that the purpose of the legitimate state is to provide for the fundamental needs of the people… Individuals cannot secure these things on their own. The pandemic has prompted an anachronism, a revival of the walled city in an age when prosperity depends on global trade and movement of people.” (NOTE– In other words: Globalism is good, Nationalism is bad. The same refrain we’ve heard for the last 30 years.)
While the assault on human health (from Covid) will—hopefully—be temporary, the political and economic upheaval it has unleashed could last for generations. (NOTE–Another peek into Henry’s crystal ball, eh?) No country, not even the U.S., can in a purely national effort overcome the virus. Addressing the necessities of the moment must ultimately be coupled with a global collaborative vision and program.” (“The Coronavirus Pandemic Will Forever Alter the World Order”, Wall Street Journal)
As Kissinger clearly states, globalization is still alive and well among the Davos heavyweights who now see a once-in-a-lifetime opportunity to put their plan into action. Parts of Australia and New Zealand are already under de-facto martial law while PM Boris Johnson is adding another 2,000 cops in London to enforce his goofy Covid mandates. Everywhere in the western world, freedom is collapsing faster than a corrugated lean-to in a Kansas tornado. Meanwhile in panic-stricken America, fainthearted proles continue to hide behind their sofas waiting for the faux-plague to pass. Do they even see the train-wreck just ahead? Author Gary D. Barnett summed it up like this:
“At this moment in time we are standing on a precipice with the state attempting to push us over the edge. Once over that edge, there will be no coming back. This is why if the people fight back in mass, and withhold all support from the governing demons, we can awaken from this nightmare, and regain normalcy.” (“The State’s Covid Response Is a Cancer for the Freedom of Humanity”, Gary D. Barnett, Lew Rockwell)
Bravo, Mr. Barnett. That says it all.
- Futures Plunge, Gold Spikes After Trump Positive COVID Test
Futures Plunge, Gold Spikes After Trump Positive COVID Test
Tyler Durden
Fri, 10/02/2020 – 01:29Shortly after headlines hit that President Trump and the First Lady had tested positive for COVID-19, US equity futures plunged…
Dow futures are down around 500 points but Small Caps are worst for now…
Gold spiked on the news…
Treasuries are bid with yields reversing all of the week’s rise…
Somebody wake up Steve!!
- Watch: Armenia's S-300 Missiles Active Over Yerevan As Azerbaijan Steps Up 'Suicide Drone' Use
Watch: Armenia’s S-300 Missiles Active Over Yerevan As Azerbaijan Steps Up ‘Suicide Drone’ Use
Tyler Durden
Fri, 10/02/2020 – 01:00The war between Armenia and Azerbaijan over the disputed Nagorno-Karabakh border region appears to be spinning out into a broader conflict as footage of increasingly heavy and advanced military hardware is appearing.
As of late Thursday there are reports that Armenia’s Russia-supplied S-300 systems are active near the capital of Yerevan. New viral video circulating on military channels purports to show S-300 missiles intercepting a possible enemy drone or inbound rocket in the vicinity of Yerevan.
Video confirmation over Yerevan of S-300 shooting down Missiles. #Azerbaijan #Armenia #Artsakh
[Knish] pic.twitter.com/Q4JbS50xPT— Aurora Intel (@AuroraIntel) October 1, 2020
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Specifically, the event is being widely said to have occurred over Abovyan, which lies about 16 kilometers northeast of Yerevan in the Kotayk Province.
Within an hour of the footage appearing online, Armenia’s Ministry of Defense seems to have confirmed the dramatic escalation.
An enemy drone was downed by the air defence forces in the air space of #Armenia, Kotayk region.
— MoD of Armenia 🇦🇲 (@ArmeniaMODTeam) October 1, 2020
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“An enemy drone was downed by the air defense forces in the air space of Armenia, Kotayk region,” the Armenian MoD wrote on Twitter.
Another angle of air defenses intercepting over Abovyan.
#Azerbaijan #Armenia #Artsakh
[Knish] pic.twitter.com/kIjxi4MbcR— Aurora Intel (@AuroraIntel) October 1, 2020
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Earlier in the day a separate Azerbaijan drone intercept video closer to the center of fighting in Karabakh was posted via official Armenian military channels.
Destruction of an #Azerbaijan‘i drone. pic.twitter.com/7R0xMnaUiS
— MoD of Armenia 🇦🇲 (@ArmeniaMODTeam) October 1, 2020
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Azerbaijan has a significant and advanced drone program, having been supplied for years by Israeli defense firms, including so-called Kamikaze drones.
These ‘suicide drones’ appear to be in use by Azerbaijan’s army:
Footage from Armenian soldiers shows the moment an Azerbaijani IAI Harop loitering munition (suicide drone) targeted what is claimed to be a troop transport bus in Vardenis, Armenia. pic.twitter.com/OzTgF5bHyg
— Kyle Glen (@KyleJGlen) October 1, 2020
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Though Azerbaijan’s security and arms relationship with Israel has been documented over the past few years, it’s unclear the degree to which Israeli intelligence or military advisors are still present in Azerbaijan, potentially still assisting with the deadly drone program.
“Harop” loitering munition (LM) system, via The Jerusalem Post However, it’s unclear what type of drone was intercepted near the vicinity of Yerevan on Thursday.
There are also emerging reports that two or more projectiles may have been intercepted near the Armenian capital.
- Smith: Is The Pussification Of America's Youth Scientifically Engineered?
Smith: Is The Pussification Of America’s Youth Scientifically Engineered?
Tyler Durden
Fri, 10/02/2020 – 00:00Authored by Brandon Smith via Alt-Market.us,
There’s been a lot of debate lately on what generation of Americans is the most to blame for the current failures of the US as a society.
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Baby Boomers blame millennials for being weak, lazy and entitled;
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millennials blame boomers for ruining the system before they were ever born while enjoying the fruits of a more prosperous economy.
The real answer is that it’s partially the fault of BOTH generations, but not for the reasons often argued.
The boomer vs. snowflake conflict is a controlled narrative that deliberately avoids the greater issues at hand. Yes, the newest generations of Americans have been utterly pussified, but I believe this is part of a larger agenda, and baby boomer parents unwittingly and stupidly played a supporting role.
In 4th Generation warfare the concept is to destroy a nation or civilization without using direct military confrontation, at least, not right away. Instead, the goal is to destabilize the target society from within and let the citizenry self destruct. Then, once the population is in sufficient chaos, you move in with your military forces and take over, meeting minimal resistance along the way.
The strategy can also be used to undermine and control a population by it’s own government or by elites within that government as a means to stop potential rebellion against the establishment power structure. In other words, use controlled chaos to create panic and weakness, and then snatch up more power while the citizenry is distracted and disorganized.
In order to create chaos and panic in a population, that population must be completely unprepared to deal with crisis events. They must be mentally soft and lack resolve, otherwise they might become self reliant and defiant rather than fearful and easy to control.
I was recently studying psychological conditioning methods used to prepare people for combat and crisis scenarios. The phrase “stress inoculation” comes up often. In certain branches and units of the US military there is an increased emphasis on stress inoculation (beyond basic training) as a means to strengthen soldiers and their fortitude so that when they do eventually find themselves in a combat situation where they might die, they don’t panic and allow adrenaline to take over their motor and thought processes.
Department of Defense think-tanks like DARPA have published extensive white papers on the subject, and stress inoculation is also used to some extent to treat people with Post Traumatic Stress Disorder.
The ability to perform calmly under stress is the key to combat readiness. The most effective warriors, and the most successful people in life, usually have the ability to manage stress and perform at a high level while other people flounder in terror.
Historically, many civilizations have been very careful in how they choose and train warriors for defense. Native American tribes, for example, would carefully vet their warriors and make sure they chose men that would NOT run away at the first sign of trouble; rather, they picked men they knew would confront trouble directly. A small force of psychologically prepared men was considered far superior to a vast army of potential bed wetters and hysterics.
Mentally vetting people for stress management skills has been a common human practice for thousands of years.
Some people are simply born with a greater capacity for it, but many others can be trained for stress inoculation using basic methods. The key is for people to start learning stress management when they are children. This requires them to go through experiences which cause short term acute stress, rather than long term chronic stress.
Short term acute stress strengthens mental response time and increases confidence and psychological stability by acclimating a person to surprise and shock. Long term chronic stress does the opposite, never allowing the person to acclimate and causing them to revert to a constant state of fear.
Acute stress events include physical exercise, competitive play, being placed in unfamiliar surroundings and being forced to adapt, regularly undertaking new and useful skill sets, sticking with a skill set until it is mastered, and even interactions with larger groups of unfamiliar people, such as public speaking.
One could also apply the ancient philosophical concept of Zen to stress inoculation, particularly the practice of mastering a skill so completely that a person becomes “one” with that talent, and thus “one” with themselves and their place in the world. If you have ever met a person that is a true master of a useful skill, you know that they tend to be extremely calm and confident people that do not panic easily regardless of the situation.
While researching stress inoculation methods, it struck me – What if a society was to do the exact OPPOSITE of this? What if an entire generation of children were deliberately sheltered from all forms of short term acute stress? What if they were encouraged to never work hard at anything? What if they were not given any incentive to accomplish any goals? What if competition was discouraged and children were taught to despise it as “barbaric” and “debilitating”? What if accomplishment was dismissed and the idea of “winning” was eliminated in the name of “fairness and equality”?
What if a generation of kids were so thin skinned and untrained in stress management that they panic and run to the nearest authority figure for help at the first sign of trouble? What if they were so spoiled that they had never learned to take care of themselves? What if all of their life experiences were in the form of a safe, insulated digital fantasy world where there is no real risk?
Now imagine you then take this highly coddled and sheltered generation and you suddenly expose them to a massive crisis event; such as an economic crash, or even the threat of a global pandemic? How would this group of children, now moving into adulthood without any practical skills or emotional toughness, respond to the situation?
All of their actions would be reactionary and rooted in panic and terror. Because they have never trained to deal with acute stress events they are now a walking time bomb of fear. They might respond by running and hiding, or they might respond by lashing out violently, but in either case they will have no self-control and will be ruled by emotion and adrenaline rather than logic and reason.
Wouldn’t this be the most effective way to destroy or dominate a nation over the span of a couple decades?
In America today there is the more obvious trend of social justice warriors among younger generations and their complete inability to function in normal adult society without constant protection.
What is the purpose of concepts like “safe spaces”, trigger warnings, forced diversity, intersectionality, critical race theory, micro-aggressions, implicit bias, etc., other than to artificially swaddle people so they never have to deal with negative experiences?
The only reason for the existence of so-called “victim groups” is for people who have no stress management skills to continue to avoid any and all acute stress events for the rest of their lives by making it socially or legally unacceptable to criticize them, discriminate against them as individuals, or place practical demands on them. They become a protected class with special privileges.
They deny the need to compete based on merit in the working world because they claim competition is “racist” and creates inequality. Anything that causes them stress is immediately deemed an “aggression” against them personally, and all stressors are treated as equally offensive; meaning, an insult or criticism becomes the same as a physical attack, and they react with the same level of emotional panic to both.
I believe this is a major contributor in the rush by some young people to join the “trans movement”, as it represents an easy outlet to gain victim group status and thus attain protection from stress.
Did this movement of perpetual childhood develop out of this air? The evidence says no. The social justice movement with all its Marxist underpinnings was funded and managed directly by elitist organizations like the Rockefeller Foundation and the Ford Foundation, it becomes clear that the pussification of America’s youth is not a natural progression but an engineered program.
This is openly admitted in Alison R. Bernstein’s book ‘Funding The Future: Philanthropy’s Influence On Americas Higher Education’. Bernstein is the vice president of Education at the Ford Foundation and the former Associate Dean of Faculty at Princeton.
It’s not just the SJW lunatics that are the problem, though. A vast number of young people are finding themselves completely unprepared for adult life and they blame boomers indirectly for their failings. Contrary to popular belief, boomers had nothing whatsoever to do with the decline of the US economy; if you want to find the culprits behind your financial pain, I suggest learning about the history of the Federal Reserve and how that institution has systematically destroyed our currency’s buying power and our economy over time.
Where boomers are culpable is in their terrible parenting model. They raised a generation of weaklings and rarely questioned the establishment and media propaganda that told them that helicopter parenting and the “self esteem model” was the best way to raise their children. While perhaps done out of love, boomers spoiled their own kids so completely and shielded them from all acute stress that as young adults they now have no capacity to succeed in a world where survival instincts might be required.
Consider the most common complaint among next-gen adults – That boomers all enjoy home ownership while they will never be able to afford the privilege because boomers ruined the economy. This, they claim, is the reason why boomers should not be allowed to criticize the inactivity and laziness of millennials. Yet, the majority of boomers had to leave home and become adults at age 18 (some of them even sooner), while a large number of millennials live with mom and dad well into their 30s, feeding off of them like parasites rather than working and saving. Gen Z appears ready to do the same. Boomers started their adult lives sooner, and thus they accumulated assets and wealth faster.
Of course, boomers share the blame. Helicopter parents have helped to ruin American culture, even though numerous psychological studies indicate that sheltering children from short term stress destroys their ability to cope as adults.
At bottom, though, boomers were encouraged at every moment to continue this style of parenting by the media and elitist foundations. The Ford Foundation in particular was a primary force behind the modern parenting and public education methodology of stress avoidance. The foundation was key in the development of such programs as Head Start and has spent hundreds of millions on the training of public school teachers in social justice methodologies.
Ford was also the primary engine behind the creation of the National Education Television Center, which later became PBS, and funded such prominent children’s shows as Sesame Street and Mister Rogers. This is not to say the people that produced these shows had any nefarious agenda in mind, only that both shows often promoted stress avoidance rather than stress confrontation and management. To this day, stress inoculation training is becoming more and more rare among America’s youth, and it is quickly being erased in public schools.
If history is any indicator, the weakest generations when faced with overwhelming crisis will demand protection, as they always have, whether it be physical protection or financial protection. And inevitably they will turn to government collectivism or the money elites for a feeling of safety in exchange for their liberties. They don’t value their freedoms because they have never enjoyed the feeling of independence anyway. The trade for comfort becomes easy for them.
Not all younger Americans suffer from this affliction. Many are strong willed, but those that are usually admit freely that they feel isolated among the majority of their peers. I find it hard to believe it’s mere coincidence that perhaps the weakest generation of Americans ever is now facing the worst series of crisis events in our history. The whole thing seems planned…
Stress inoculation is a lot like strengthening your own immune system – Sometimes you have to work through sickness when you are young in order to improve your immunity to sickness later in life. By the same token, you have to experience stress events when you are young so that you can better deal with crisis events later in life. Otherwise, you grow up as malleable as jello and just as easy to devour.
The good news is, even as adults stress inoculation can be learned. As our world grows more and more unstable and uncertain, being able to manage our own fears is becoming paramount to our continued liberty and livelihood.
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- Pandemic Special: "Don't Pay Rent Until 2021" For NYC Apartments
Pandemic Special: “Don’t Pay Rent Until 2021” For NYC Apartments
Tyler Durden
Thu, 10/01/2020 – 23:40The number of empty rental apartments in Manhattan has tripled compared with last year, forcing some landlords to become increasingly desperate as they struggle to find tenants amid an urban exodus.
Douglas Elliman and Miller Samuel’s August report showed the number of empty rental apartments in Manhattan surpassed 15,000 units in August, up from 5,600 a year ago.
Facing a glut of inventory, with demand quickly collapsing, landlords are becoming desperate – consider this:
“Don’t pay rent until 2021, select properties now offering up to three months complimentary rent,” read the message banner of a New York City apartment listing’s website, operated by Related Rentals Corporate.
By the month, landlords are becoming more desperate to find tenants as an urban exodus, triggered by the virus pandemic, social unrest, and remote working has collapsed demand. There’s also a seasonal factor as colder weather blankets the region and makes it less likely that people would want to move.
Referring to the developing inventory glut crisis, Gary Malin, chief operating officer of brokerage Corcoran Group, which represents landlords, told Bloomberg, “You can’t hide it anymore… Owners are saying to themselves, ‘I’d rather be honest from the beginning, rather than play a game back and forth, and otherwise lose a tenant.'”
Malin said the glut gives renters incredible leverage over landlords, with the ability to find “the best possible deal.”
“Tenants are filling out four to five applications at the same time and negotiating one offer against the other,” he said. “Owners want to lead with their best foot. If you sit and try to hold on for every last penny, for every last dollar, tenants are just going to go somewhere else.”
Other properties in New York’s downtown area are offering similar free rent schemes, including Brookfield Properties’ Gehry tower. There’s also Equity Residential, who has deals at some of its luxury buildings, including Prism at Park Avenue South.
Ofer Yardeni, Chairman and CEO of Stonehenge NYC, said occupancy before the virus lockdown was about 99%. Shortly after, the figure fell to 85% as some tenants returned home to live with their parents, while others moved to the suburbs. He said remote working was also a significant factor in why people left the city.
“I’ve been in the business for over 30 years and I’ve never seen the market this way,” Yardeni said. “It’s almost like a falling knife.”
We’ve focused on CMBS shorts from malls to hotels; maybe it’s time to start looking at apartment buildings…
The next housing crisis is here, and this time, it’s about rentals.
- New Study Suggests Binge Drinking Could Damage Brain And Cause Lasting Anxiety
New Study Suggests Binge Drinking Could Damage Brain And Cause Lasting Anxiety
Tyler Durden
Thu, 10/01/2020 – 23:20Authored by John Vibes via TheMindUnleashed.com,
A recent study suggests that binge drinking alcohol could seriously damage the brain in ways that increase the risk of cognitive-behavioral issues like anxiety.
The study, which was conducted by researchers at the University of Porto, found that just ten days of binge drinking cause immune cells in the brain to destroy connections between neurons, which leads to anxiety and other mental health issues.
It is important to note that these were not human studies, as the test subjects were mice, but these types of experiments typically give significant insight into how different substances affect the brains of humans.
Study co-author João Relvas, told Inverse that, “[We] don’t have any reason to believe that the same mechanisms will not be operating in the human brain. Even for a short period of time, excessive drinking is likely to affect the brain, increasing the level of anxiety, a relevant feature in alcohol abuse and addiction.”
“The dangers of alcohol drinking, especially amongst the younger population, have been widely underestimated and excessive alcohol drinking is socially relatively well tolerated. Increasing public awareness and education of the young can, together with other measures, change the way society looks at alcohol intake,” Relvas added.
In the study, the researchers broke the mice off into two groups. One group was given alcohol over a 10 day time period, while the other group was not. Half of the mice were given 1.5 grams per kilogram of ethyl alcohol each day, which is the equivalent of five drinks for an adult human that weighs 165 pounds.
After 10 days, the researchers looked at the mice’s brain tissue and found that the mice who consumed alcohol had significant damage to the area of the brain that controls complex cognition and decision making, which resulted in increased anxiety.
The researchers also determined the process that caused this damage in the brain. They believe that alcohol boosts the production of an inflammatory molecule called TNF.
In further experiments, they used a drug called pomalidomide to block TNF and found that it prevented anxiety and reduced the impact that the alcohol had on the brain.
The symptoms are “ultimately driven by increased secretion of TNF by microglia, as we show that reducing its production either pharmacologically or genetically can prevent synapse loss and anxiety,” Relvas says.
Relvas also said that this drug could potentially be used to treat alcohol addiction.
“This study suggests that regulating the levels of TNF might eventually be useful when treating alcohol addiction,” he said.
However, the team does not recommend that anyone use TNF inhibitors while binge drinking, because further studies need to be done to confirm the safety and efficacy of the drugs for the purpose.
Furthermore, TNF inhibitors would not prevent any of the other damage that alcohol can do to the rest of the body.
“Alcohol abuse is a leading cause of disease with a massive impact on human life and should be treated as so,” Relvas says.
His team’s findings were published earlier this month in the journal Science Signaling.
- Small Firm Bust Accelerates As Bankruptcies Soar In September
Small Firm Bust Accelerates As Bankruptcies Soar In September
Tyler Durden
Thu, 10/01/2020 – 23:00Policies promoted by the White House and the Federal Reserve to support small firms have been widely insufficient as bankruptcy filings are back to levels not seen since the dark days of the virus pandemic, according to Bloomberg, citing a new report via bankruptcy court data firm Epiq AACER.
At least 620 companies filed for Chapter 11 protection in the first 25 days of September, a 48% increase over the same period last year. Bankruptcy filings in June and July saw 609 and 644, respectively.
Chris Kruse, senior vice president at Epiq, said, “we’re seeing a continued strong flow of Chapter 11 filings in September, consistent with what we saw in June and July,” adding that “they range from businesses with small footprints to high street retailers.”
Fed Chairman Jerome Powell has admitted the Fed’s lending program for smaller businesses has been challenging.
“Trying to underwrite the credit of hundreds of thousands of very small businesses would be very difficult,” Powell said.
As a result, most of the Fed’s liquidity flowed to mega-corporations while smaller ones were shut out, leaving them widely exposed to bankruptcy as a fiscal cliff, which started on July 31, has ravaged small firms and households for the last two months.
With Republicans and Democrats still far apart on agreeing on the next round of economic stimulus, downward pressure on small firms and households will continue. The failure to pass the next stimulus bill, in a timely fashion, could result in a double-dip recession.
Deirdre O’Connor, managing director of corporate restructuring at Epiq, said, “we will continue to see filings for companies that had been the most disrupted by Covid and are operating in a zero revenue environment.”
Data compiled by Bloomberg shows 193 bankruptcy filings year-to-date of companies with more than $50 million in liabilities were recorded for the first nine months of the year. If filings continue to accelerate into fall/winter, then this year could rival the 271 high, recorded in 2009.
For more color on small firm health nationwide via high-frequency data, we turn to Opportunity Insights’ Economic Tracker of the percentage change in the number of small businesses open as of Sept. 13, suggesting nothing but disaster for mom and pop shops ahead of the fourth quarter.
We noted in early September how seasonal shifts to colder temperatures would make it extremely challenging for restaurants, clubs, and entertainment venues to serve patrons in outdoor spaces.
With consumers spending less and steering clear of brick and mortar retail stores because of the virus pandemic, the second round of the economic crash could be dead ahead. Stimulus and reopenings of the economy have proven worthless as the small business bust could erupt further in the fall/winter.
As a reminder, small firms are the lifeblood of the economy, without them, there can be no “V” shaped recovery.
- The Urban Exodus And How Greatness Goes Bankrupt
The Urban Exodus And How Greatness Goes Bankrupt
Tyler Durden
Thu, 10/01/2020 – 22:40Authored by Charles Hugh Smith via OfTwoMinds blog,
The best-case scenario is those who love their “great city” will accept the daunting reality that even greatness can go bankrupt.
Two recent essays pin each end of the “urban exodus” spectrum.
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James Altucher’s sensationalized NYC Is Dead Forever, Here’s Why focuses on the technological improvements in bandwidth that enable digital-economy types to work from anywhere, and the destabilizing threat of rising crime. In his telling, both will drive an accelerating urban exodus over the long-term,.
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Jerry Seinfeld’s sharp rebuttal, So You Think New York Is ‘Dead’, focuses on the inherent greatness of NYC and other global metropolises based on their unique concentration of wealth, arts, creativity, entertainment, business, diversity, culture, signature neighborhoods, etc.
The core issue neither writer addresses is the financial viability of high-cost, high-tax urban centers.
It’s telling that Seinfeld’s residency in Manhattan began in the summer of 1976, shortly after the federal government provided loans to save the city from defaulting on its debts and declaring bankruptcy.
In other words, Seinfeld arrived at the very start of New York’s fiscal rebuilding, though its social decline would continue for another few years (the 1977 blackout and looting, etc.). Fiscal conservative Ed Koch was elected mayor in 1977 and by 1978, the city had paid off its short-term debt.
This return to solvency laid the foundation for the eventual revival that attracted capital, talent and hundreds of thousands of new residents, replacing the 1 million+ residents who had moved to the suburbs in the tumultuous 1960s and 70s.
This urban exodus had led to urban decay which had generated a self-reinforcing feedback: the greater the decline in livability, the more people who moved out, which then reduced commerce and taxes, further exacerbating urban decay, and so on.
As I explained in How Extremes Become More Extreme, these feedback loops are one way that Extremes Become More Extreme until a tipping point / phase change is reached and livability and solvency both collapse.
The other dynamic I discuss is the Pareto Distribution, the 80/20 rule which can be distilled to 64/4 (80% of 80% is 64%, 20% of 20% is 4%). Once the vital 4% act, they exert outsized influence on the 64%, far out of proportion to their numbers.
Thus the expanding criminality of the 4% criminal class can dramatically change perceptions of safety and security of the 64%.
Telling people who no longer feel safe in the city that crime only went up 10% will not change their minds.
If 20% of the businesses in a district close for good, the district might retain enough of a concentration of commerce to draw customers.
But once the number of businesses plummets below a critical threshold, the survival of the remaining enterprises becomes doubtful as the customer base drops below the level needed to sustain the remaining businesses.
As I have repeatedly stressed, the surviving businesses are burdened by high fixed costs, none of which have declined even as commerce collapsed.
Again, you cannot persuade people who no longer feel that shopping is safe and fun to get out there and spend, spend, spend like they did a year ago.
Neither Altucher nor Seinfeld mention the macro-issues of demographics and the broader economy.
Despite soaring inflation and a roller-coaster stock market, jobs were plentiful in the 1970s, partly because the Baby Boomers were entering the market for goods and services and partly due to low costs for employers.
As late as the mid-1980s, it only cost me $50/month (one day’s pay for a moderate-wage worker) to provide good healthcare insurance for a single, young worker. Try buying a month of good healthcare insurance today for one day’s moderate-wage pay.
Not only were rents much cheaper (measured by the number of hours of work needed to pay rent), there were “squats” where the rent was zero, and a variety of cheap “slum” dwelling options. These options have mostly disappeared from the housing inventory, so it now takes enormous sacrifices to live in a “great city”.
Compare these positive demographics and cost structure then to the present. Not only are jobs no longer plentiful, many of the Millennials who flocked to a “great city” for jobs and the amenities can no longer afford to live there.
Many found jobs in the dining-out and retail sectors that have been devastated, and they only survived financially by sharing flats with multiple roommates.
Costs such as healthcare insurance and housing are “sticky:” insurers, landlords, etc. are reluctant to cut prices for fear that cost reductions may become permanent, hurting their profitability.
These high costs are also endangering all the cultural institutions and commercial life that attracted people to the “great cities.” I doubt that every symphony, opera company, museum, music venue, etc. will survive the downturn, due to their incredibly high fixed costs of operation.
As I’ve noted before, the patrons who are financially able to support these costly institutions are older and wealthier, and have the most to lose if they feel their basic security is no longer assured. They’re the first to join the exodus to safer, less risky homes elsewhere. Yes, they’ll miss all the amenities, but not enough to make them stay.
I’ve also stressed the absolute necessity for any entity to be financially viable. If the entity isn’t viable in terms of income covering all expenses, it dissolves regardless of its greatness.
Seinfeld is on solid ground arguing that great cities will never go away, as their benefits are simply too compelling. On the other hand, goats were grazing in Rome’s Forum, a few decades after the Western Empire collapsed.
What collapsed wasn’t just Imperial authority; the city could no longer afford all the free bread and circuses which fed and amused much of its vast populace, not could it defend / maintain the long trade routes that fueled commerce or the political structure that secured the wealth of its nobility.
Cities are not cheap to operate, and they must continually attract workers and capital / wealth which can both be taxed at a high rate. They also need a high volume of commerce that can be taxed.
Most employers are facing a profound reset that will very likely require permanent cost-cutting to maintain profits, and remote work is very cost-effective, as commuting and office space are both unnecessary expenses that can be eliminated.
In terms of financial viability, much of the activity that generated taxes for “great cities” is gone for good: downtown concentrations of tens of thousands of workers that supported hundreds of small businesses, commercial landlords paying high property taxes, and so on.
The question nobody seems to be asking is: are cities no longer financially viable, given the enormous cost of living, the high taxes needed to run the city, and the strong economic and demographic headwinds?
What kind of city is possible if half the small businesses close and tax revenues fall by 50%? What effect will those massive changes have on the livability of the city and its most compelling attractions? How will the city provide services on half the revenues?
The worst-case scenario is only those who can’t afford to leave will be left. Unless great sacrifices are made by those remaining, that’s not a recipe for financial viability, it’s a recipe for goats grazing in the Forum.
The best-case scenario is those who love their “great city” will accept the daunting reality that even greatness can go bankrupt, and that the city will have to adapt in new and wrenching ways to remain financially viable as tax revenues decline and some percentage of the wealthiest taxpaying residents have left or will leave.
It’s not just the urban exodus that’s the challenge–it’s who’s in each successive wave of the exodus. If the wealthy, the entrepreneurs and the displaced small business owners leave in the first wave, the adaptation will have to be rapid and profound, as the modest, incremental reforms that typify the past 75 years will not be enough to be consequential.
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My recent books:
A Hacker’s Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook coming soon) Read the first section for free (PDF).
Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World
(Kindle $5, print $10, audiobook) Read the first section for free (PDF).Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic ($5 (Kindle), $10 (print), ( audiobook): Read the first section for free (PDF).
The Adventures of the Consulting Philosopher: The Disappearance of Drake $1.29 (Kindle), $8.95 (print); read the first chapters for free (PDF)
Money and Work Unchained $6.95 (Kindle), $15 (print) Read the first section for free (PDF).
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- Payrolls Preview: The Last Report Before The Election
Payrolls Preview: The Last Report Before The Election
Tyler Durden
Thu, 10/01/2020 – 22:25While few expect major surprises from tomorrow’s payrolls report, the fact that it will be the last jobs report before the Nov 3 election makes it especially important if only from a political standpoint: a blowout number will be hyped aggressively by Trump; the opposite will fall right into Biden’s hands as evidence the economy is cooling rapidly.
That said, the odds may be in Trump’s favor because as Goldman writes in its payrolls preview, high-frequency labor market information “indicates strong September job gains, and the second derivative improvement in the public-health situation suggests scope for a pickup in Sun Belt job growth.” On the negative side, there has been a spike in recent mass layoff announcements, while the start of the school year will lower education payrolls by 200-300k, as many janitors and support staff did not return to work. Goldman also expects a roughly 50k drag to government payrolls from the wind-down of the 2020 Census.
That said, here are the consensus expectations ahead of tomorrow’s number which will be released at 830am:
- Nonfarm Payrolls exp. 850k (range -100k to +1.800mln, prev. +1.371mln);
- Unemployment rate exp. 8.2% (range: 7.6-8.6%, prev. 8.4%);
- U6 unemployment (prev. 14.2%);
- Participation (prev. 61.7%);
- Private payrolls exp. 850k (prev. 1.027mln);
- Manufacturing payrolls exp. 35k (prev. 29k);
- Government payrolls (prev. 344k);
- Average earnings m/m exp. +0.2% (prev. +0.4%);
- Average earnings y/y exp. +4.8% (prev. +4.7%);
- Average workweek hours exp. 34.6hrs (prev. 34.6hrs).
Here are some big picture observations ahead of tomorrow’s payrolls courtesy of NewsSquawk:
- The rate of Initial Jobless Claims rose in the September survey week against expectations it would fall, while Continuing Claims fell less than hoped.
- ADP’s payrolls gauge was more encouraging, rising more than expected, although it remains to be seen if it will correlate to the BLS following recent divergences.
- The Manufacturing ISM came in slightly cooler than expected as the pace of the rebound begins to plateau, which was somewhat at odds with the strong regional prints; the employment sub-component rose but it still remains beneath the 50 mark.
- Challenger Job Cuts were little changed from the August print, although have come down considerately since the record print in April.
- There has been a slew of large job cuts announced this week but those will most likely be a matter for October’s report, somewhat balanced out by the pick-up in seasonal hiring.
And some more in-depth observations:
INITIAL JOBLESS CLAIMS: Weekly Initial Jobless Claims rose to 870k from the upwardly revised 866k level in the September employment survey reference week, against expectations for a decline to 850k. Continuing Claims fell to 12.580mln from the pwardly revised 12.747mln. Pantheon Macroeconomics notes that the Initial Claims print has been flat lining now over the past four weeks following a one-time drop of 127k in the final week of August due to a change in the seasonal adjustment methodology, “Using the old seasonals, it looks as though the trend in claims has been unchanged since mid-August.” The consultancy affirms the labour market plateau against the daily small business employment data produced by Homebase, “pointing to flat payrolls in the sector in August and, more recently, a small outright decline.” The consumer-heavy US economy will struggle to continue recovering amid the roll-off of enhanced unemployment benefits, to which Pantheon doesn’t see the implementation of a “meaningful” relief bill until February given the divide in Congress; a pick-up of COVID cases only serves to cut output further. The consultancy warns, “Next week’s September payroll data likely will report a modest seasonally adjusted increase in private jobs, perhaps 500K or so, half the August gain, and October could easily see private payrolls fall.”
ADP: The September ADP report was encouraging as it continued to rise, the headline for private sector employment growth came in at 749k, topping the 650k estimate; the previous was also revised higher to 481k from 428k. The report bodes well for Friday’s BLS report. Although the relationship between the BLS and ADP release has been questionable in recent months, Pantheon highlights that ADP has substantially understated the official figures since the pandemic hit, but the error is much smaller since spring. “We can’t be sure it will narrow again in September, but that seems to be a reasonable assumption”, Pantheon posits. The consultancy looks for 950k in Friday’s September jobs report, adding the homebase employment data points to significantly weaker payrolls in October, and perhaps even the first decline since April.
MANUFACTURING SECTOR: The September ISM fell to 55.4 from 56.0, below the expected rise to 56.4. When comparing to the strong regional Fed surveys, the decline came in as somewhat of a surprise. Weighing the most was the fall in New Orders, which fell from the bumper 67.6 figure to 60.2, still a firm reading. The production component also fell to 61.0 from 63.3. Dampening the fall was the pick-up in the lagging indicators: Delivery Times, Inventories and Employment. The latter rose to 49.6 from 46.4, potentially boding well for the NFP print, although, noticeable, that figure still has not reclaimed the 50 figure. It’s also worth noting that we do not yet have the ISM Services survey to gauge the respective employment component; that is somewhat unhelpful given the US economy is predominantly services-led.
JOB CUTS: Challenger reported 118,804 job cuts in September, which was little changed from August’s 115,762, but was up 185.9% vs September 2019. However, the figure has come down significantly from April’s record 671,129, and note that prior to COVID, the highest reading was 186,350 in February 2009, although this month’s reading still sits heavily above the c. 50k average reading seen in “normal times” during the last decade. Challenger says, “We are setting new records for job cuts even though things have improved since the earliest days of the pandemic.” The report showed the heavily hit sectors such as entertainment and leisure continuing to lead in announced cuts, although there were several sectors outside those industries with large cuts such as Aerospace & Defense, as well as transportation, “We are beginning to see cuts spread to sectors outside Entertainment and Retail. Especially if another relief package fails to pass, employers are going to enter the fourth quarter hesitant to invest or spend.” The silver lining to the release was the pick up in hiring intentions to 929,860, compared to August’s 160,411, however, do note that at least a third of that is related to seasonal hiring and that hiring is heavily skewed to retailers with a strong online presence, with traditional brick and mortar retailers remaining under immense pressure
Finally, some qualitative considerations from Goldman: factors arguing for a better than expected report:
Arguing for a better-than-expected report:
- Big Data. High frequency data on the labor market were generally strong in September (see Exhibit 1), with five of the six measures we track indicating significant job gains and four of the six consistent with a beat tomorrow of 500k or more. Additionally, the restarted Census Household Pulse survey is consistent with a 16mn decline in the level of unemployment from mid-May to mid-September (vs. -7.4mn in the official measure from mid-May to mid-August).
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- Jobless claims. While still elevated, initial jobless claims declined significantly during the September payroll month (averaging 0.9mn per week vs. 1.2mn in August). Additionally, continuing claims declined by 1.9mn from survey week to survey week (after adjusting for biweekly filing schedules in Florida and California).
- Employer surveys. Business activity surveys improved on net in September, as did the employment components of our survey trackers (non-manufacturing +2.8pt to 49.1; manufacturing +2.4pt to 53.8).
- Job availability. The Conference Board labor differential—the difference between the percent of respondents saying jobs are plentiful and those saying jobs are hard to get—rose into expansionary territory (+2.9 in September from -2.2 in August and +2.2 in July).
- ADP. Private sector employment in the ADP report rose by 749k in September, somewhat above consensus. We viewed the ADP report as incrementally positive news but broadly similar to expectations.
- Census hiring. Census temporary workers are set to boost nonfarm job growth by 255k in August, as additional field staff were hired to conduct interviews.
- Employer surveys. Business activity surveys improved on net in August, as did the employment components of our survey trackers (non-manufacturing +3.0pt to 46.3; manufacturing +2.6pt to 51.4).
- Job cuts. Announced layoffs reported by Challenger, Gray & Christmas fell 65% in August to 116k after rising 68% in July and falling 43% in June (mom, sa by GS). They remain 114% above their August 2019 levels.
Arguing for a weaker-than-expected report:
- Education seasonality. We expect a seasonal drag in education categories related to the coronacrisis to lower September job growth by roughly 200-300k (public + private). Some of the janitors and other school staff who normally return to work in September did not this year due to virtual reopenings in much of the country. Reflecting this, we expect education payrolls to rise by less than the BLS seasonal factors anticipate, resulting in a sizeable drop in reported job growth in the sector. At the same time, the level of education employment is already considerably below its typical summer bottom (11.9mn vs. roughly 12.5mn in a normal year), which we expect to limit the drag to only a few hundred thousand. The inability to obtain childcare is also likely to weigh on job creation at the margin, though its effect may already be mostly reflected in the August payroll levels (given the cancellation of some in-person summer camps and an earlier reduction in childcare provider availability).
- September seasonality. We also note that payrolls have exhibited a tendency toward weak September first prints, with a miss versus consensus in 8 of the last 10 years. However, the magnitude of the potential bias is small (between -30k and -50k) relative to the underlying inflections in the data this year.
- Census hiring. Census temporary workers are set to lower nonfarm job growth by around 50k in September, as training and field operations began to wind down.
- Job cuts. Announced layoffs reported by Challenger, Gray & Christmas rose 5.6% in September to 127k after falling 61% in August and rising 56% in July (mom, sa by GS). They remain 191% above their September 2019 levels.
Neutral/mixed factors:
- Second wave. The US experienced a dramatic resurgence of coronavirus during the second half of June—particularly in the Sun Belt states—and by the July Fourth holiday, nearly two-thirds of the country had paused or reversed their reopening plans. However, job growth remained firm in July and August despite a pause in the Sun Belt leisure and hospitality recovery (see Exhibit 2). With restrictions generally stable or easing over the last month, we note scope for a pickup in job growth in some segments. Illustratively, a 50% reversal of the late-summer leisure deceleration in the Sun Belt would boost monthly job growth by 320k. On the other hand, weaker demand for back-to-school apparel may have limited hiring in the retail sector (relative to a normal September).
And speaking of Goldman, this is what the vampire squid expects tomorrow:
- 1.1mn nonfarm payrolls rose, above consensus of +0.875mn; private payrolls up 1.2mn vs consensus is +0.9mn.
- Unemployment rate declined by three tenths to 8.1%, vs 8.2% consensus, a forecast reflecting another strong rise in household employment partially offset by higher labor force participation.
- Average hourly earnings rose 0.1% month-over-month, boosting the year-on-year rate by a tenth to 4.8%
Source: NewsSquawk, Goldman Sachs
- Will The 2020 Election Be The Beginning Of The End For Our System Of Government?
Will The 2020 Election Be The Beginning Of The End For Our System Of Government?
Tyler Durden
Thu, 10/01/2020 – 22:00Authored by Michael Snyder via The End of The American Dream blog,
Most Americans assume that our system of government could never fail, but the truth is that it is failing right in front of our eyes.
In order for our system of government to work, people need to be able to believe that their votes will count and that the outcomes of our elections will be fair. For over 200 years, most Americans did have faith in the system, but now things are rapidly changing. Here in 2020, we appear to be heading for a hotly contested result in the presidential election, and many on the losing side are inevitably going to believe that the election was stolen from them.
And day after day we just continue to see more examples that indicate the security of our elections is being compromised on a widespread basis. Not too long ago, I wrote about the military ballots for Trump that had been discarded in a dumpster in Pennsylvania and the ballots that were discovered in a ditch in Wisconsin.
And now today I came across a report about how memory sticks that are “used to program Philadelphia’s voting machines” were stolen from a warehouse…
A laptop and several memory sticks used to program Philadelphia’s voting machines were stolen from a city warehouse in East Falls, officials confirmed Wednesday, setting off a scramble to investigate and to ensure the machines had not been compromised.
Though it remains unclear when the equipment was stolen, sources briefed on the investigation said the items vanished this week. The laptop belonged to an on-site employee for the company that supplies the machines. It and the USB drives were the only items believed to have been taken.
We will want to watch the results coming out of Philadelphia very carefully, because the winner of Pennsylvania is probably going to win the presidency.
In 2012, 100 percent of the vote went to Barack Obama in precinct after precinct in Philly, and it will be very interesting to see if a similar pattern emerges during this election.
Elsewhere, James O’Keefe has just exposed an absolutely shocking “cash-for-ballots harvesting scheme” in Minnesota. Apparently people were being paid lots of money to collect absentee ballots from elderly individuals and fill them out for preferred Democratic candidates. The following comes from a Newsweek report…
“Just today we got 300 for Jamal Osman,” Mohamed says in the video. “I have 300 ballots in my car right now.”
“Numbers don’t lie. You can see my car is full. All these here are absentee ballots. Look, all these are for Jamal Osman.”
Mohamed can be seen showing white envelopes on his car’s dashboard in a video from July 1. Later in the Project Veritas video Mohamed says, “Money is the king in this world… and a campaign is driven by money.”
How can an election be legitimate when there is this sort of vote buying going on?
And now with tens of millions of ballots going through the mail in 2020, it is going to be easier to “harvest” ballots than ever before.
I just have such a bad feeling about what is going to happen in November.
For weeks, the mainstream media has been trying to convince us that President Trump will probably have a lead on election night but that Joe Biden will win once all of the mail-in ballots are finally counted.
Of course it could take a really long time for all of those ballots to be counted, and meanwhile all sorts of monkey business could be happening in the background that we don’t know anything about.
In the end, one side is going to end up bitterly disappointed and will feel like the election has been stolen. If Trump wins many Biden supporters will believe it was because all of the votes were not fairly counted, and if Biden wins many Trump supporters will believe that there was widespread fraud involving mail-in ballots.
We could very easily end up with a scenario where both candidates are declaring victory, and that could set up a very ugly constitutional crisis.
In one of his recent articles, James Howard Kunstler detailed one way that this could all play out…
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The complicit newspapers and cable news channels publish polls showing Joe Biden leading in several swing states, even if it’s not true.
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Facebook and Twitter amplify expectations of a Biden victory.
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This sets the stage for a furor when it turns out that he loses on election night.
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On cue, Antifa commences to riot all around the country. Meanwhile, a mighty harvest of mail-in votes pours into election districts utterly unequipped to validate them.
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Lawfare cadres agitate in the contested states’ legislatures to send rogue elector slates to the electoral college. The dispute ends up in congress, which awaits a seating of newly-elected representatives on January 4, hopefully for Lawfare, mostly Democrats. Whoops…!
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Turns out, the Dems lost their majority there too. Fighting in the streets ramps up and overwhelms hamstrung police forces in Democratic-run cities.
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January 20 — Inauguration Day — rolls around, and the Dems ask the military to drag Trump out of the White House “with great dispatch!” as Mr. Biden himself put it so nicely back in the summer.
I do believe that Trump will have a lead on election night.
In fact, it could be a very big lead.
Trump has been trashing voting by mail for months, and this is going to encourage most of his supporters to vote in person. In fact, during the first presidential debate Trump once again talked about potential problems with mail-in votes…
In the final segment of the contentious debate between Trump and Democrat Joe Biden, Trump launched into an extended argument against mail voting, claiming without evidence that it is ripe for fraud and suggesting mail ballots may be “manipulated.”
“This is going to be a fraud like you’ve never seen,” the president said of the massive shift to mail voting prompted by the coronavirus pandemic.
And the Republican National Committee has also been making disparaging statements about voting by mail…
‘We always expected to be behind at this point as Democrats have made it their mission to push for an all-mail election that brings fraud and chaos into the system,’ said Republican National Committee spokesman Mike Reed. ‘You’ll see Democrats predominantly vote by mail, and our voters will come out in droves to vote in person, especially on Election Day.’
Those that follow my work on a regular basis already know how I feel about voting by mail. I believe that Americans should be required to vote in person whenever possible, because voting by mail just opens up so many opportunities for things to go wrong.
And many on the left are starting to realize this too. For example, the following comes from a recent article by Derek Thompson…
Mail votes require several steps, and different steps in different locations, including postmarking the ballots, signing in various places, and using the proper number of envelopes. For that reason, it can confuse first-time voters, and even experienced voters used to queuing at local high schools. Two studies of the 2018 midterm elections in Florida and Georgia found that young and minority voters are especially likely to have their mail ballots rejected.
For most of 2020, Democrats have been relentlessly promoting voting by mail, but now they are beginning to understand that could result in hundreds of thousands of their votes being thrown out. In fact, it is being reported that more than half a million votes were “disqualified” during the 2020 primaries…
In the 2020 primaries, more than 550,000 mail and absentee ballots were disqualified, a much higher number than four years ago. The problem is especially severe in some swing states. More than 23,000 mailed ballots were rejected in the presidential primaries in Wisconsin—more than Donald Trump’s margin of victory in that state in 2016. Deep-blue districts have had the same problem: New York City alone threw out more than 84,000 ballots this primary season.
In the end, Democrats could be sabotaging their own efforts by pushing mail-in voting so much. If Democrats vote by mail in much higher numbers than Republicans, they will also likely have their votes disqualified in much higher numbers too.
Right now, Democrats are requesting mail ballots at a much higher rate than Republicans are in quite a few key swing states…
Of the more than 9 million voters who requested mail ballots as of Monday in five critical states where the data is available – Florida, Pennsylvania, North Carolina, Maine and Iowa – 52 percent were Democrats, 28 percent were Republicans, and 20 percent were unaffiliated.
Additional internal Democratic and Republican Party data obtained by The Washington Post shows a similar trend in Ohio, Minnesota, New Hampshire and Wisconsin, the paper reported.
Many Republican operatives are deeply concerned about these numbers, but perhaps they shouldn’t be.
If Republicans show up in person at the polls in tremendous numbers, that could give Trump an enormous lead on election night.
Of course Joe Biden will definitely not concede no matter how large the lead looks, and that will set the stage for weeks of legal wrangling over the counting of votes in multiple states.
Ultimately, we will probably have to wait a long time to see if the Democrats can come up with enough “mail-in ballots” to overcome Trump’s lead.
But this process is not going to be good for our nation no matter who ends up winning.
In fact, it is likely that millions of Americans will be so turned off by what happens that they will lose faith in the system permanently.
And once faith in our system is gone, it will be nearly impossible to get back.
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- Trump Executive Order Seeks To Combat China's Rare-Earth Minerals Dominance
Trump Executive Order Seeks To Combat China’s Rare-Earth Minerals Dominance
Tyler Durden
Thu, 10/01/2020 – 21:40On Wednesday President Trump signed an executive order which declared a “national emergency” in the US mining industry, highlighting America’s dangerous overdependence on China for what’s known as rare-earth minerals.
China has been widely acknowledged as dominant in the rare-earth minerals market for decades, which includes a group of obscure minerals (typically 17 identified as such) often used in manufacturing anything from advanced electronics like flat screens to even weapons. For example, one of the most sought after – samarium cobalt – is used in precision guided missiles and fighter jets, and advanced communications systems.
Via Shutterstock The order says that “our Nation’s undue reliance on critical minerals, in processed or unprocessed form, from foreign adversaries constitutes an unusual and extraordinary threat, which has its source in substantial part outside the United States, to the national security, foreign policy, and economy of the United States. I hereby declare a national emergency to deal with that threat.”
China began cementing its global dominance in the 1980s after the Nuclear Regulatory Commission and the International Atomic Energy Agency moved to severely restrict rare-earth mineral mining related to environmental concerns.
They are deemed “rare” precisely because there are no known alternatives to them, and given they’ve been key in developing specific technologies preponderant among industrialized populations.
The order’s text specifically charges that Beijing has intentionally exploited its position in the market, especially regarding 35 minerals that are “essential to the economic and national security of the United States”:
Our dependence on one country, the People’s Republic of China (China), for multiple critical minerals is particularly concerning. The United States now imports 80 percent of its rare earth elements directly from China, with portions of the remainder indirectly sourced from China through other countries. In the 1980s, the United States produced more of these elements than any other country in the world, but China used aggressive economic practices to strategically flood the global market for rare earth elements and displace its competitors.
Rare-earth minerals file image As Reuters underscores, “While the United States used to be the leading producer of the minerals, China has used its heft in the industry to its advantage in the trade dispute between the two world leaders.”
No doubt this remains a crucial US vulnerability weakening Washington leverage amid Trump’s ongoing trade dispute, as well as select sanctions on the mainland related to the Hong Kong issue and other geopolitical pressure spots.
Just after Trump’s signing the order, Ellen Lord, the top acquisition official at the Pentagon, told a Senate hearing “We are on a trajectory to increase our national defense stockpile relative to rare earth minerals. The silver lining of COVID has been that I think most Americans now understand the importance of having domestic supplies.”
“We could certainly, especially under the auspices of the [executive order] that just came out yesterday, work with the interagency, because there is already a lot of work going on to look at expanding the national defense stockpile to include more rare earths,” she said in her Thursday remarks.
- Debt, Zombies, And Geopolitics: China's Belt-And-Road Initiative During COVID
Debt, Zombies, And Geopolitics: China’s Belt-And-Road Initiative During COVID
Tyler Durden
Thu, 10/01/2020 – 21:20Authored by Jon (Yuan) Jiang via The Jamestown Foundation,
Introduction
The Belt and Road Initiative (BRI) has been a focal issue for understanding the foreign policy of the People’s Republic of China (PRC). Some observers view the BRI as representing a new phase of economic globalization and regional economic integration. Others argue that the BRI’s primary motivating factors are domestic and that the massive program is chiefly aimed at creating new markets, maintaining economic stability, resolving regional development imbalances, and transferring industrial overcapacity. Both views have their valid points, but overlook the BRI’s key role in supporting China’s domestic economic reforms. This article argues that the BRI should be understood as a major component of China’s program of “supply-side structural reform” (gongjice jiegouxing gaige).
The “Authoritative Person” and Supply-Side Structural Reform
The BRI was first announced in 2013 and officially incorporated into the PRC constitution in 2017 (Xinhua, October 24, 2017). The concept of “supply-side structural reform” (SSSR) was reportedly introduced by the Chinese Communist Party (CCP) General Secretary Xi Jinping in late 2015 and developed into a significant component of Beijing’s economic policy framework (Xinhua, April 3, 2018). In a speech to the 19th Party Congress, Xi stated that “We should pursue supply-side structural reform as our main task, and work hard for better quality, higher efficiency, and more robust drivers of economic growth through reform” (China Daily, December 18, 2019).
Throughout 2015 and 2016, the People’s Daily, the CCP’s most authoritative newspaper, published a series of interviews with an anonymous “authoritative person” (quanwei renshi) that discussed the concept of SSSR (People’s Daily, May 25, 2015; January 4, 2016; May 9, 2016). It has been widely understood that the information presented in this series of interviews came either from the offices of Liu He (??), director of the General Office of the Central Financial and Economic Affairs Commission (Zhongyang Caijing Weiyuanhui Bangongshi), or else from Liu himself. Liu is one of the PRC’s chief economic architects and has been described by party media as “one of the masterminds behind China’s supply-side structural reforms“ (People‘s Daily, March 20, 2018).
In the interviews, the “authoritative person” concluded that a return to China’s former debt-stimulated growth rate of ten-plus percent a year would be impossible, and instead stressed the sustainable and qualitative development of the Chinese economy. To this end, the main tasks of the SSSR are to improve the quality and efficiency of supply; promote structural adjustments; correct the allocation distortion of factors of production; enhance the adaptability and flexibility of the supply structure to changes in demand; and advance total factor productivity (People’s Daily, January 4, 2016). More concretely, SSSR encompasses five core policy objectives:
1) cutting excess industrial capacity;
2) reducing leverage in the corporate sector;
3) reducing property inventories;
4) lowering costs for businesses, and
5) addressing “weak links” in the economy (a euphemism for poverty reduction).
China’s BRI is well-positioned to address the first and fourth goals of SSSR. Hu Huaibang, former Chairman of the China Development Bank, has argued that the BRI can offset the problem of increasing labor costs through the structural transformation of China’s economy (People’s Daily, July 16, 2018). In this way, the BRI alleviates industrial overcapacity by transferring low-end manufacturing industries to less developed countries with lower labor costs.
SSSR and China’s Persistent Problem of Corporate Debt
The most crucial objective of SSSR is reducing leverage in the corporate sector. At the 2017 National Financial Work Conference, Xi stated that “financial stability is the basis of national stability, and deleveraging state-owned enterprises is the top of the top priorities. ” Xi called on local officials to control debt and maintain social security, while declaring local government debt to be one of the greatest threats to China’s financial security (Xinhua, July 15, 2017). At the end of 2019, the global financial rating companies Moody’s Analytics and Fitch Ratings, Inc. both raised warnings about rising defaults in Chinese debt. Moody’s chief economist warned that Chinese corporate debt represented the “biggest threat” to the global economy (Business Times (China), December 18, 2019).
Presciently, the “authoritative person” had warned two years earlier that the leverage issue, rather than unemployment, could cause disasters for China:
The total labor force in China is decreasing year by year…Even if the economy is experiencing a significant downturn, social employment can remain generally stable… However, the issue of leverage is different… High leverage will inevitably bring high risks. Poor control over leverage will lead to a systemic financial crisis [and] negative economic growth, even causing ordinary people to lose their savings. This will be disastrous. (People’s Daily, May 9, 2016).
Ma Guonan, a fellow at the Mercator Institute for China Studies, has found that China has had the fastest-growing ratio of corporate debt to GDP of any country in the world, rising by 65 percent following the 2008 global financial crisis. Ma’s calculations found that China’s total corporate, government, and household debt had doubled in ten years to a high of roughly 242 percent of total GDP, making China “the most indebted emerging economy” (MERICS, August 22, 2019).
A 2019 OECD working paper found that China’s corporate debt was concerningly high, with state-owned enterprises (SOEs) accounting for over three-quarters of that debt in 2017 (OECD, February 7, 2019). A 2016 article in People’s Daily by Liu Yuanchun , Vice President of Renmin University, argued that SSSR should center on SOE reforms. Liu’s article was designated “essential reading” (renmin yaolun), again hinting at strong official support for controlling the risk of overleveraged SOEs (People’s Daily, February 25, 2016).
The Belt and Road Initiative’s Role in Supply-Side Structural Reform
Because of the BRI’s close association with the Chinese government, the program has mostly benefited SOEs, which have both the funding and connections to successfully lobby for contracts (Daily Economic News (China), September 20, 2018). In 2018, People’s Daily reported that central government-run SOEs had undertaken 3,116 BRI projects, with data from the State-owned Assets Supervision and Administration Commission of the State Council (Guowuyuan Guoyou Zichan Jiandu Guanli Weiyuanhui) (SASAC) showing that central SOEs were contracted on half of all current and planned future infrastructure projects related to the BRI (China Daily, November 12, 2018).
PRC officials are looking to the BRI to help SOEs address the overcapacity problem, open up external markets, and offset rising domestic labor costs. BRI participation can also help SOEs carry out the SSSR-mandated goal of controlling corporate debt. As stated by Hong Shen of Carnegie Mellon University, “Many BRI projects are directly funded by Beijing-backed financial institutions that often explicitly or implicitly require receiving countries to outsource projects to Chinese companies.” Such project demands create a captive market for SOEs, providing an opportunity to pay down their over-leveraged debt.
Despite its benefits, the external risks associated with the BRI may still be too much to bear for Chinese SOEs. In the last year, Beijing has invested less in the BRI, and the dream of creating a win-win network of “enhanced economic interconnectivity” has had limited effect in mitigating economic crises such as the U.S.-China trade war or the global pandemic (China Brief, September 26, 2019; November 1, 2019; March 16). In the wake of new foreign hostilities, and a slowing global economy exacerbated by the ongoing COVID-19 pandemic, the CCP leadership has ramped up efforts to reduce China’s reliance on overseas markets and technology to drive economic growth. This drive has culminated in Xi Jinping’s recent push for a new “dual circulation” (shuangxunhuan) economic model (China Brief, August 14, 2020; Asia Times, August 24; Xinhua, September 2).
Image: Front page of the May 9, 2016 issue of People’s Daily, featuring an article by an unnamed “authoritative person” on China’s economic reforms. (Image source: Sina.com)
In giving Chinese SOEs unprecedented access to overseas contracts, the BRI seemed well-positioned to aid debt reduction and job creation, two key issues for ensuring China’s economic survivability. But the BRI may have also revealed a grim truth: that China’s SOEs have difficulty competing in both domestic and overseas markets, even with the assistance of the Chinese government and the BRI. China’s SOEs are popularly called “zombie enterprises” because they rely on government subsidies or bank loans to stay alive (China Brief, March 16), a fact noted by the “authoritative person.” As a result, one of the most urgent tasks of the Chinese government is to deal with these “zombies” in order to reduce excessive production capacity, and free up valuable physical resources, credit resources, and market space (People’s Daily, January 4, 2016).
From 2016 to 2019, the state-owned steel giants Dongbei Special Steel, Chongqing Iron & Steel, Henan Commerce & Trade, and Bohai Steel were either liquidated or went bankrupt. In 2019, Beijing issued a reform plan to speed up the improvement of the SOE exit system, promoting the bankruptcy and restructuring of state-owned zombies (Guancha, July 16, 2019). These concrete measures have had tangible results: SOE debt growth has declined since 2017 (OECD, February 7, 2019). A recent article by Guo Shuqing, Secretary of the Party Committee of the People’s Bank of China and Chairman of the China Banking and Insurance Regulatory Commission, also confirmed that the corporate sector’s leverage ratio has stabilized and declined (Qiushi, August 16).
Conclusion: SSSR and the BRI after COVID-19
The Rhodium Group has projected that Beijing can retain the high gear lending of the BRI because policy banks are able to maintain the loan pace of 2015-2019 (Rhodium Group, April 15). BRI loans form a minor part of the Chinese overall lending portfolio, and China Development Bank and China Export-Import Bank have ample political support to cover the cost. But Beijing is unlikely to enlarge its loans to BRI-participating countries in the short term. Due to the pandemic, some states may not be able to make their repayments on time, and the BRI may face financial losses. A June report by the Ministry of Foreign Affairs noted that COVID-19 had “seriously affected” nearly a fifth of projects along the BRI (SCMP, June 28). Beijing may either opt to reduce debt obligations or seek to postpone payments and extend terms, as sovereign lenders often do in response to a financial crisis. Renegotiating the terms of BRI-related debt will bring its own political and economic risks, and could raise the specter of debt-trap diplomacy, hurting China’s international prestige. Postponing payments would also increase the financial sector’s total debt, undermining the principles of SSSR.
Fortunately, after several years of implementation, the ambiguously defined and constantly evolving BRI has shown its versatility and adaptability. In the aftermath of COVID-19, the PRC has promoted once-overlooked concepts such as the Digital Silk Road and the Health Silk Road to spur global economic recovery, as well as emphasizing “green” aspects of the BRI that parallel China’s leading role in international climate change dialogues (IIGF (Beijing), May 30). China’s leadership is also reframing the BRI to align with high-level policies to deleverage and carry out SSSR. In a speech at the Second Belt and Road Forum for International Cooperation in 2019, President Xi Jinping said “we welcome the participation of multilateral and national financial institutions in BRI investment and financing and encourage third-market cooperation” (PRC Ministry of Foreign Affairs, April 26, 2019).
Recent testimony to the Chinese People’s Political Consultative Conference (CPPCC) has also underscored Xi’s claim that future funding for the BRI will no longer prioritize SOEs, instead opening up the playing field to private actors and foreign companies. (China-U.S. Focus, July 30). State media organs and leading economists have effectively disavowed China’s bloated “zombie” SOEs, leaving room for developments towards a multi-tiered, market-oriented financing system that will better support China’s domestic prioritization of SSSR.
- Is 'Big Tech' Trying To Bribe Biden To Drop Trump's Anti-Trust Push?
Is ‘Big Tech’ Trying To Bribe Biden To Drop Trump’s Anti-Trust Push?
Tyler Durden
Thu, 10/01/2020 – 21:00Reuters has partnered with Open Secrets to explore an often-overlooked issue in American politics. While Democrats like Joe Biden have talked the talk when it comes to holding Big Tech accountable, many senior members of Biden’s circle have close ties to America’s largest tech giants, particularly Amazon, which has come to symbolize Silicon Valley’s corporate greed by paying no federal taxes, while its founder and CEO Jeff Bezos hardly paying any taxes, either.
Anybody who believes that Joe Biden, if elected, would simply pick up where President Trump’s DoJ and FTC have left off when it comes to the anti-trust pressure facing Big Tech – pressure that could eventually lead to the breakup of Facebook and company – is probably ignoring these deep ties, which stretch all the way back to President Barack Obama’s first presidential campaign.
Starting with the most obvious: Amazon spokesman Jay Carney is a former press secretary for the Obama Administration. Amazon General Counsel David Zapolsky is a top Democratic bundler. The Biden transition team and various issue-based working groups have drawn heavily from Silicon Valley.
Tech’s ties to Biden run deep.
Amazon’s Carney worked in former President Barack Obama’s administration as press secretary for a little over three years. He was Vice President Biden’s communications director for the first two years of the Obama administration.
Amazon General Counsel David Zapolsky is a top fundraiser for Biden, also known as a bundler who as individuals have raised more than $25,000. Bundlers are sometimes rewarded with plum positions in their beneficiary’s administration, such as key jobs in federal agencies and influential advisory commissions. Zapolsky has also directly contributed a little over $250,000 to different funds supporting Biden’s presidency, according to campaign finance records. Zapolsky did not comment.
Meanwhile the Biden campaign’s transition team and working groups have added at least eight people who worked for Facebook, Google, Amazon and Apple and others with ties to these companies.
But it’s not just personnel: Silicon Valley firms are among the biggest donors to the Biden campaign, according to data gleaned from Open Secrets, a nonprofit that seeks to organize campaign finance data. The data show that while Amazon has taken an early lead, Alphabet and Microsoft are also among the largest corporate donors to the Biden campaign. Since companies can’t make these donations directly, these figures factor in money from company-affiliated PACs, as well as employees’ personal donations.
GOP Sen. Josh Hawley, a vocal critic of China and Big Tech, told Reuters that progressives hoping for Biden to hold people like Zuckerberg “accountable” are being naive. The ties between Team Biden and the top levels of Amazon, Facebook and Alphabet are simply too strong.
Republican Senator Josh Hawley, a close ally of Trump and a vocal critic of large tech companies, said the progressives may get a “rhetorical nod in their direction now and then,” but the Biden campaign’s fundraising shows the progressives will struggle. “For Amazon in particular to be featured at a political convention is really, really worrisome,” Hawley told Reuters. “It’s taking their lobbying to a whole new level.”
On the other hand, one source whom Reuters billed as a senior “advisor” to Biden on tech policy – a designation which of course means he has no official role inside the campaign – argued that the public outrage at Big Tech would force Biden’s hand.
Donations from senior Amazon executives to the Biden campaign during the primaries were second only to Microsoft, according to data from the Revolving Door Project, which is part of the Center for Economic and Policy Research.
“I think all the fundraising we are seeing is probably going to buy them (Amazon) access, but in terms of policy results, I think it’s going to buy them very little,” said an advisor on tech policy to the Biden campaign, who did not wish to be named. “There is a lot of collective outrage against tech in Washington these days, and they simply cannot fly under the radar.”
Still, progressives are clearly worried, as one aide to a “progressive” Senate Democrat added that opponents of Big Tech will need to focus on key administration appointments.
A senior policy counsel for a progressive Senate Democrat, who did not wish to be named, said Big Tech’s closeness with the Biden campaign is worrying. The battle for the left wing of the Democratic party on this issue will be on whether they can get crucial appointments in the administration and less about moving Biden toward progressive options, the aide added.
Finally, Sally Hubbard, identified by her affiliation with the Washington-based Open Markets Institute, which is working to combat Big Tech’s monopoly power, warned that all this money has probably bought Amazon and the rest of them plenty of inroads with the Biden people. That means a potential President Biden probably would treat Big Tech with kid gloves.
Sally Hubbard, who has worked with Democratic lawmakers in the past and currently focuses on monopoly power of tech companies at Washington-based Open Markets Institute, does not want a Biden victory to translate into a repeat of what was widely viewed as President Barack Obama’s hands off approach to tech.
“Are we going to see the same thing with a Biden administration?” she asked, adding there will be a significant amount of pressure from anti-monopoly groups and the progressive wing of the Democratic party to hold the companies accountable.
While the DOJ’s anti-trust division head Makan Delrahim has expanded his targets to include securities exchanges data tier-ing, he’s also leading anti-trust investigations into Facebook, Amazon, Alphabet etc with the FTC taking on part of the workload.
- Mapping Los Angeles' Homeless Encampment Challenge: Nearly 100,000 Cases Reported Since 2019
Mapping Los Angeles’ Homeless Encampment Challenge: Nearly 100,000 Cases Reported Since 2019
Tyler Durden
Thu, 10/01/2020 – 20:40Submitted by Adam Andrzejewski,
Los Angeles represents the glitz and glamour of the California lifestyle. It’s a tourist mecca that boasted 50 million visitors in 2019 – an all-time high.
The greater Los Angeles area can also claim Muscle Beach in Venice; the Hollywood movie studios; the rich and famous in Beverly Hills; and a previously booming economy that trailed only New York City and Tokyo.
But the city itself is in trouble, and tourists should be advised to avoid some neighborhoods and streets entirely.
Today, Los Angeles hosts an estimated homeless population of nearly 40,000 people (the entire states of Texas and Florida have between 25,000 and 28,000 respectively). Affluent sections of the city have become dangerous with open-air drug use, human feces, medieval diseases, and, sadly, homeless encampments.
Since 2019, there have been at least 94,430 reported complaints of homeless encampments in public spaces –an average of 4,500 per month.
First elected in 2013, Mayor Eric Garcetti promised to clean things up. However, conditions are the same or worse. Last year, the number of encampment complaints spiked to 55,569. The same pace has continued in 2020 with 35,241 instances already reported through August.
Our auditors at OpenTheBooks.com plotted all reports of homeless encampments since 2019 (20 months) using latitude and longitude address coordinates of all cases opened by the city. Available data is the result of resident reporting to the city’s 311 dispatchers.
Using our interactive map, just click a pin (ZIP Code) and scroll down to review the results rendered in the chart beneath the map.
The LA homeless encampment challenge 2019-2020: an interactive map with 94,000+ reports We reached out to the mayor for comment and his spokesperson, Alex Comisar responded:
“Homelessness is the humanitarian crisis of our time, and confronting it has always been one of Mayor Garcetti’s top priorities. While we work to keep streets and sidewalks clean and safe for everyone, our focus must remain on efforts to build housing and bring our homeless neighbors indoors for good.”
Although 106 city neighborhoods were affected, one in three encampments were reported in just ten neighborhoods. Here are the top five: 1. Downtown Los Angeles (5,264 cases); 2. Venice (4,817 cases); 3. Woodland Hills- Warner Center (4,339 cases); 4. Wilshire Center-Koreatown (3,917 cases); and 5. Van Nuys (3,426 cases).
Across the city, 127 ZIP Codes reported encampment complaints. The top five locations had the highest concentration – between 2,200 and 4,500 encampments each. Those ZIPs were 90291 (4,497 cases); 90004 (2,980 cases); 91364 (2,549 cases); 90028 (2,352 cases); and 90020 (2,248 cases).
#1 Neighborhood: Downtown Los Angeles (5,264 cases)
Since 2019, over 5,200 homeless encampment cases were reported in the heart of Los Angeles. The downtown features art museums, hip restaurants and a mix of modern high-rise buildings and traditional landmarks.
It also ranked first in homeless encampments since 2019.
Affected police precincts include Central (3,138 cases); Newton (2,022 cases); and Rampart (104 cases). Avoid the entire length of Hill Street, which had 446 encampment complaints since 2019.
#2 Neighborhood: Venice (4,817 cases)
Encampments were reported 4,817 times within the Venice neighborhood. A buzzing beach community, Venice is known for its free spirit with the boardwalk, skate park, muscle beach, funky shops and street performers.
Today, the homeless populations affect the quality of life.
The only police precinct affected was Pacific. The city council member in the district is Mike Bonin. Avoid the entire stretch of Venice Boulevard with 650 cases since 2019.
Plotting the case reports of homeless encampments in ZIP 91364 since 2019.
#3 Neighborhood: Woodland Hills- Warner Center (4,339 cases)
Since 2019, there were 4,339 instances of homeless encampment reported. That’s an average of 217 reports per month for the last 20 months in this area.
This neighborhood is a master planned community and business district with a mix of small businesses, skyscrapers, and residential development in the San Fernando Valley.
Police precincts affected include Topanga (4,295 cases) and West Valley (44 cases). Avoid Ventura Boulevard and Freeway with 1,242 cases.
#4 Neighborhood: Wilshire Center-Koreatown (3,917 cases)
There were 3,917 homeless encampment complaints within this neighborhood. Known for its casual dining, relaxed, fun atmosphere, and late nights, there are bars, grills, karaoke, speakeasies, and clubs.
Police precincts affected include Olympic (3,765 cases) and Rampart (162 cases). The elected council members in this area include Herb Wesson (3,247 cases), Mitch O’Farrell (626 cases), and David Rye (44 cases). Avoid Oxford and Serrano avenues, which had the most activity (around 150 cases each).
In recent years, the city council earmarked hundreds of millions of dollars to alleviate the homeless crisis. The 2020 budget, for example, allocated $430 million to homeless services.
LA residents have also sought to alleviate the problem. In 2016, voters approved the mayor’s Proposition HHH – a tax hike to cover $1.2 billion in bonds to build 10,000 housing units for the homeless.
However, it took three-years to put up the first unit, and a recent audit shows that each unit cost $700,000 to construct.
Today, the city’s official data has 6,780 open and unresolved encampment complaints. The mayor’s administration admits to using a lighter touch during the pandemic and holding back on sweeps and cleanups.
So, Los Angeles still faces a human health catastrophe, an uncertain future, and increasingly dangerous neighborhoods for residents and tourists alike.
- House Democrats Pass $2.2 Trillion Virus Relief Bill, Crushing Hopes For Compromise Stimulus Before The Elections
House Democrats Pass $2.2 Trillion Virus Relief Bill, Crushing Hopes For Compromise Stimulus Before The Elections
Tyler Durden
Thu, 10/01/2020 – 20:36Just after 8pm ET, the Democrat-controlled House approved a massive, Democrat-proposed $2.2 trillion fiscal stimulus package, i.e., the HEROES Actin a move cementing the split between the two parties and designed to cast blame on Senate republicans for killing passage of the outsized stimulus after bipartisan negotiations failed to yield the fifth covid agreement.
The vote, which passed 214-207 with no Republican support, effectively precludes any hope that a compromise fiscal stimulus can be passed before the elections even though Speaker Pelosi earlier insisted the vote wouldn’t slam the door on negotiations with the White House on a bill President Donald Trump could sign into law.
The one page summary on the revised HEROS Act is presented below:
After sitting down with Treasury Secretary Steven Mnunchin Wednesday, she spoke with him several times by phone again Thursday, although talks far failed to bridge what’s been a gap of roughly $600 billion dollars between the two sides. Sharp differences also remain on components of coronavirus relief, with the Trump administration rejecting the scale of aid Democrats want for state and local authorities – which would effectively represent a taxpayer-funded bailout for decades of mismanaged pensions – while Pelosi demanded the end of tax breaks she says are devoted to the wealthy.
Pelosi told reporters Thursday evening that she would review documents that Mnuchin had sent her to determine where to go next after several calls during the day, although when one strips away the theatrics, the answer is nowhere. “We are going back and forth with our paper,” she said, underscoring the importance of the language used in any deal.
Pelosi said the House’s vote on its own bill would help present in a more public way what Democrats are unified in “pushing for” in the negotiations. Last month, Republicans in the Senate, where they have a majority, also attempted to pass their own $650 billion “skinny” package – but that in turn was blocked by Democrats.
The bottom line is that unless Senate Republicans agree to state and local bailouts, and they won’t even if Trump demands they do, this likely marks the end of any hopes for a fifth and much needed fiscal stimulus, even as American savings generously built up in the aftermath of the covid lockdowns thanks to trillions in government handouts, are rapidly dwindling.
Indeed, as noted earlier, and as we warned back in June, the economic data is already sharply slowing due to the “fiscal cliff” – the fading impact of the $2 trillion stimulus enacted in March. Americans’ incomes fell in August by the most in three months after the government’s supplemental unemployment benefits expired.
Meanwhile, with the presidential elections 33 days away and Congress expected to adjourn beforehand for the final leg of the campaign, time for a deal in the next month is effectively gone. Meanwhile, Wall Street economists have already sharply cut their growth forecasts for the fourth quarter after they wrongly predicted – much to our amusement – that a $1.5-$2 trillion deal would pass.
“People say we should have a skinny package — no, we don’t have a skinny problem. We have a massive problem,” Pelosi said on the House floor Thursday, making it clear that Democrats intend to use the pandemic as a smokescreen for every single bailout they can cobble together, including state and local.
While Democrats reduced their stimulus demands from a $3.4 trillion bill the House passed in May, the legislation just approved by the House is still more than Republicans have said they could accept. As reported previously, Senate Majority Leader Mitch McConnell said earlier that it was rife with “poison pills” that have nothing to do with pandemic relief.
Meanwhile, Senate Republicans have expanded their proposed bid from $300 billion to $1.6 trillion, and while the difference is shrinking, at this point the bulk of its represents the state bailouts that is a redline for most Congressional republicans.
That’s also why House Republicans cast the bill as pure political messaging, more of a left-wing, campaign-year wish list that showed how far apart the two sides are than genuine legislating.
Top Appropriations Committee Republican Kay Granger of Texas characterized the package as a “damaging partisan bill.” She said it “was crafted without the input from members on our side of the aisle and does not have the support needed to pass the Senate or be signed by the president.”
Meanwhile, Mnuchin said Trump instructed his negotiators “to come up significantly” from the initial GOP proposal of a $1 trillion pandemic relief plan, which they did but not enough to match the Democrat ask.
“I can’t tell how much of this is genuine effort to pass a bill and how much is position-taking prior to the election,” said Josh Huder, a senior fellow at Georgetown University’s governmental affairs institute. We can help you Josh: all of this is nothing more than theatrics.
And since some analysts suggest Pelosi and House Democrats have less to lose politically from a stalemate on stimulus than the White House and Republicans – especially with Trump reportedly lagging in the polls – both sides now appear resigned to no new stimulus before the election, and – should Republicans retain the Senate – perhaps after as well.
S&P Futures dropped about 13 points on the news but have since rebound, perhaps expecting that this is just a Democratic gambit to force the GOP to capitulate under added pressure from Trump.
Here’s the bottom line: unless we have another real crash – we are talking down more than 20% from here – nothing will change, and no bill will be passed in the immediate and not so immediate future.
- President Trump, First Lady Test Positive For COVID-19
President Trump, First Lady Test Positive For COVID-19
Tyler Durden
Thu, 10/01/2020 – 20:26Update (0100ET): President Trump and First Lady Melania Trump have tested positive for COVID-19, according to a Thursday night tweet. “We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!” he added.
Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!
— Donald J. Trump (@realDonaldTrump) October 2, 2020
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As too many Americans have done this year, @potus & I are quarantining at home after testing positive for COVID-19. We are feeling good & I have postponed all upcoming engagements. Please be sure you are staying safe & we will all get through this together.
— Melania Trump (@FLOTUS) October 2, 2020
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In a Thursday night memo from Trump physician Sean P. Conley said “This evening I received confirmation that both President Trump and First Lady Melania Trump have tested positive for the SARS-CoV-2 virus.
The President and First Lady are both well at this time, and they plan to remain at home within the White House during their convalescence.”
Some have noted that President Trump was traveling with White House Chief of Staff Mark Meadows all week – who met with Senate Majority Leader Mitch McConnell on Wednesday, as well as Supreme Court Nominee Amy Coney Barrett.
Update: Meadows has tested negative per Fox News’ Peter Doocy.
White House Chief of Staff Mark Meadows has been traveling on and off with Trump all week.
Meadows huddled with McConnell on Call Hill Wednesday, and has been assisting SCOTUS nominee Amy Coney Barrett in her meetings with senators on the Hill. pic.twitter.com/dqAhqMEC4E
— Scott Wong (@scottwongDC) October 2, 2020
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Conservative Twitter is full of well wishes and hot-takes.
The strength of the entire country is with President @realDonaldTrump and @FLOTUS.
America stands united.
Our country stands strong.
Your President will continue to put the People first!
— Kayleigh McEnany (@PressSec) October 2, 2020
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Trump is a living legend.
He will beat this.
He will win in November.
He will go down as the greatest president in American history.
— thebradfordfile™ (@thebradfordfile) October 2, 2020
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Best thing that could have happened to Trump. All oxygen belongs to him now.
— Cernovich (@Cernovich) October 2, 2020
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Meanwhile, some Trump opponents are celebrating or cracking jokes.
— Benny (@bennyjohnson) October 2, 2020
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The very upset people on the right coming after me for addressing how delicious it is that Trump has corona virus are realllly ignoring the other several million now that their special little guy has it. At least they take it seriously for SOMEBODY
— Cam (@cameron_kasky) October 2, 2020
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* * *
Update (2245ET): President Trump has just confirmed Hope Hicks positive COVID-19 test, and that he and the First Lady will begin a quarantine process:
Hope Hicks, who has been working so hard without even taking a small break, has just tested positive for Covid 19. Terrible! The First Lady and I are waiting for our test results. In the meantime, we will begin our quarantine process!
— Donald J. Trump (@realDonaldTrump) October 2, 2020
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What this means for the next debate is anyone’s guess at the moment.
* * *
Update (2030ET): The White House isn’t confirming or denying the Hicks story, though it did release one cryptic comment.
WH not confirming the @JenniferJJacobs report on Hope Hicks testing positive for COVID, but issues this statement: “The President takes the health and safety of himself and everyone who works in support of him and the American people very seriously….”
— Eamon Javers (@EamonJavers) October 2, 2020
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… “WH Operations collaborates with the Physician to the President and the WH Military Office to ensure all plans and procedures incorporate current CDC guidance and best practices for limiting COVID-19 exposure to the greatest extent possible”
— Eamon Javers (@EamonJavers) October 2, 2020
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Jacobs reports Hicks is experiencing symptoms of the disease and was in close proximity to the President and mask-less this week. No comment yet from the WH on the exposure risk to POTUS.
— Eamon Javers (@EamonJavers) October 2, 2020
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That’s definitely not a “no”.
* * *
Former White House Communications chief-turned-senior adviser Hope Hicks has tested positive for the coronavirus, reviving fears about President Trump, VP Mike Pence and other senior staffers being exposed, Bloomberg reports.
Though the anonymous sources who spilled the beans to Bloomberg insisted there was no evidence that Trump was exposed, Hicks did ride with Trump aboard Air Force One to the debate in Cleveland on Tuesday. She also traveled with Trump to his rally in Minnesota on Wednesday.
Other senior staff have contracted the virus and recovered, including National Security Adviser Robert O’Brien, though few spend as much time with the president as Hicks, who – according to BBG’s sources – is already experiencing symptoms of COVID-19, though they offered no insight into the nature of the symptoms.
During the time she spent away from the White House, Hicks served as the head of comms at Fox News, a frequent venue for Trump’s interviews and scoops. She initially left the White House in March 2018, after testifying that she sometimes told ‘white lies’ on Trump’s behalf, before returning last year.
Hicks was reportedly seen on Tuesday riding maskless in a staff van with White House senior adviser Stephen Miller, campaign adviser Jason Miller and others, which means that they were likely exposed to the virus, though it’s no guarantee. The staffers will likely be tested, as all of the senior aides to Trump reportedly are regularly screened for COVID-19.
Does this mean Trump will need to quarantine for 14 days? That, of course, would require him to miss the next debate.
- Macau Gaming Revenues Remain Down 90% In September As Slump Continues
Macau Gaming Revenues Remain Down 90% In September As Slump Continues
Tyler Durden
Thu, 10/01/2020 – 20:20Casinos in the world’s biggest gambling hub Macau showed minimal signs of improvement in September, slumping for the six consecutive month, despite the easing of tourist visas for visitors from mainland China, reported Bloomberg.
Visitors from the mainland account for over 90% of Macau’s tourist inflows but given recent visa curbs by China, and the resurgence of the virus, travel to the gaming hub remains dead.
September’s gross gaming revenue fell 90% to $277 million from a year earlier, according to new data from Macau’s government on Thursday, missed the average analyst expectation of an 85-86% decline.
“Fears China is broadening a crackdown on offshore gambling has sparked a rush to withdraw billions of dollars in Macau, threatening a recovery in the coronavirus-stricken economy,” executives told Reuters. Even though China relaxed travel restrictions to Macau on Sept. 23, by granting visas to mainlanders, executives warned that more arrivals to the gaming hub would result in an exodus of more cash.
With travel restrictions eased in the last couple of weeks, casino floors remain mostly empty as strict requirements to enter Macau from the mainland continue, such as virus testing, which has shifted many Chinese travelers to other destinations such as Hainan.
Linda Chen, vice chairman of Wynn Macau Ltd., said revenue during China’s Golden Week (begins Oct. 1) to be about 30%-50% of last year’s level.
Macau’s lackluster recovery has been widely hindered by slower visa processing, virus testing, the decline in overseas travel, the resurgence of the virus, and increased scrutiny on capital outflows by Beijing.
Shares of Wynn Macau trading on the HK stock exchange were around HKD 12.36, or about 41% below the mid-January high of HKD 20.8.
For past Macau gaming reports this year, read:
- Macau’s Gaming Revenues Crash 94.5% In July As Recovery Hopes Dim
- Macau Gaming Revenues Down 97% As Travel Restrictions Take Toll
- Macau Gaming Revenue Collapses 87.8% In February
The latest gambling revenues from Macau muddies the outlook for the world’s largest casino hub.
- Rising Homicides This Year May Be Yet Another Side-Effect Of COVID Lockdowns
Rising Homicides This Year May Be Yet Another Side-Effect Of COVID Lockdowns
Tyler Durden
Thu, 10/01/2020 – 20:00Authored by Ryan McMaken via The Mises Institute,
During Tuesday’s presidential debate, former vice-president Biden attempted to paint Donald Trump as the bad-on-crime candidate when he claimed that crime had gone done down during the Obama administration, but increased during Trump’s term.
Whether or not this is a plausible claim depends on how one looks at the data. And given that law enforcement and criminal prosecutions for street crime are generally a state and local matter, it’s unclear why any president ought to be awarded blame or plaudits for short term trends that occur during his administration.
Overall, however, it does look like homicides – which tend to be a good indicator of crime trends over all – are indeed rising this year. While many factors are likely at play, we may be seeing yet another side effect of the stay-at-home orders and resulting social fragmentation that have come to be part of the landscape of 2020. As workplaces were closed down, joblessness rose, and community organizations were shuttered, city and state governments may have been paving the way for more social conflict and crime.
Homicide in 2019
In assessing the larger context, we can turn to this week’s new report released by the FBI on 2019’s crime and homicides, and we have partial data from 2020 as well.
There is no doubt that 2019’s homicides were up slightly from where they were six years earlier. Back in 2014, homicides in the United States hit a 51-year low, falling to 4.4 victims per 100,000 residents. That is, homicides that year fell to the lowest rate seen since the post-war days when homicides were exceptionally low, and at some of the lowest rates seen since the eighteenth century.
Since then, homicide rates have risen, but have remained well below the high rates the nation experienced from the 1970s into the 1990s.
Nationwide, from 2018 to 2019, the homicide rate remained unchanged at 5.0 victims per 100,000 population. (That’s only about half the size of the homicide rates we saw during the late seventies and early nineties when homicides hovered around 10 per 100,000.)
But homicides have certainly not been evenly distributed. Total homicides in recent years were largely driven by high levels in a relatively small number of big cities like Baltimore, Memphis, and Chicago.
Nonetheless, homicide rates did increase from 2018 to 2019 in 24 states. Statewide homicide rates were unchanged in 7 states, and rates fell in 19 states.
As we’ve seen in similar analyses in the past, New England, the Pacific Northwest, and northern parts of the Midwest tend to report the lowest homicide rates. In 2019, the lowest homicide rates were found in Maine, Vermont, South Dakota, and Iowa. The highest rates were found in Louisiana, Mississippi, and Alaska.
What Is the Trend in 2020?
When we begin to look at what data we have for 2020, it looks like the trend is upward. According to the Wall Street Journal the nation’s largest cities are seeing a lot more homicide in 2020 than in recent years:
A sharp rise in homicides this year is hitting large U.S. cities across the country, signaling a new public-safety risk unleashed during the coronavirus pandemic , and amid recession and a national backlash against police tactics.
A Wall Street Journal analysis of crime statistics among the nation’s 50 largest cities found that reported homicides were up 24% so far this year, to 3,612. Shootings and gun violence also rose, even though many other violent crimes such as robbery fell.
Some cities with long-running crime problems saw their numbers rise, including Philadelphia, Detroit and Memphis, Tenn. Chicago, the worst-hit, has tallied more than one of every eight homicides.
Less-violent places have been struck as well, such as Omaha, Neb., and Phoenix. In all, 36 of the 50 cities studied saw homicide rise at double-digit rates, representing all regions of the country.
Among these cities, perhaps the most discussed is Chicago which has indeed shown a sizable increase in 2020 over the previous year. According to The Atlantic, a look at recent homicide data “shows this year’s rate (the red line) rising above the five-year baseline (the gray line and shading) at several points throughout the year.”
Note that homicides began to rise in the wake of the lockdowns, but before the riots and protests. Trends similar to Chicago’s don’t show up in all other cities. But the general trend in big cities is clear.
But what is the cause? When it comes to homicide trends, it’s nearly impossible to prove any one thing is responsible. Criminologists and historians have been debating what drives homicide trends for more than a century.
But given that 2019 was so relatively uneventful in terms of homicide growth, it does appear unlikely that government-imposed stay-at-home orders, business closures, and church closures have played no role at all in rising homicides. Yes, other factors are also at work. The unemployment resulting from business closures—not wholly attributable to forced lockdowns—is likely a factor. It is also likely that the civil unrest connected to anti-police protests and riots have played a part. As suggested in the research of criminologist Randolph Roth, homicides tend to increase as perceptions of the state’s legitimacy go into decline.1
However, as the Wall Street Journal notes:
Institutions that keep city communities safe have been destabilized by lockdown and protests against police. Lockdowns and recession also mean tensions are running high and streets have been emptied of eyes and ears on their communities. Some attribute the rise to an increase in gang violence.
Homicides … are up because violent criminals have been emboldened by the sidelining of police, courts, schools, churches and an array of other social institutions by the reckoning with police and the pandemic, say analysts and law-enforcement officials in several cities.
Schools let out young adults in March because of the pandemic and after-school activities largely stopped. Churches and other social institutions were restrained for the sake of social distancing.
“Gangs are built around structure and lack thereof,” said Jeff La Blue, a spokesman for the Fresno police department. “With schools being closed and a lot of different businesses being closed, the people that normally would have been involved in positive structures in their lives aren’t there.”
The Atlantic also suggests a role for the pandemic response among other proposed causes such as rising gun sales and rising unemployment.
A Side Effect of Lockdowns?
When it comes to lockdowns as a source of conflict, the problem lies in the fact that governments have forced the closure of the very institutions which do much to defuse violence within communities. Indeed, the connection between these social institutions and violence has been suggested for decades by sociologists.
Known as “third places,” these institutions play a key told in encouraging peaceful human interactions. As noted by researchers at the Brookings Institutions:
Third places have a number of important community-building attributes. Depending on their location, social classes and backgrounds can be “leveled-out” in ways that are unfortunately rare these days, with people feeling they are treated as social equals. Informal conversation is the main activity and most important linking function. One commentator refers to third places as the “living room” of society.
Without these institutions, people living on the edges of criminality are more likely to feel alienated and lacking in community support of any kind. Violence often follows. During the worst of the lockdowns, city residents faced closed schools, closed churches, and closed businesses. As the Journal notes, under these conditions, violent gangs may offer a much-needed refuge from government-imposed isolation. Even with stay-at-home orders lifted, governments continue to impose restrictions on social institutions like churches and other meeting places and threaten them with police harassment in case of non-compliance. Yet, these third places cannot simply be shut down—or their services drastically reduced—without creating the potential for greater conflict and antisocial behavior.
It is likely folly to try to pin rising homicides in 2020 on any single cause, but we should not be shocked that a rising homicide rate is accompanying the so-called “new normal.” After all, the government-imposed shutdowns have done far more than shut down community organizations. They have thrown millions of Americans out of work – with more than ten million former workers currently collecting unemployment benefits – and have set the stage for a rising tide of evictions and bankruptcies. History has shown that economic malaise does not necessarily come with rising crime. But unemployment rarely helps matters.
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