Posts Tagged ‘Welfare State’

Why Poor People Support Trump

Thursday, July 28th, 2016

If you’re looking to figure out the Donald Trump phenomena, you could do a lot worse than reading this interview with J.D. Vance, the author of the book Hillbilly Elegy: A Memoir of a Family and Culture in Crisis. It’s a look at rural poverty and desperation most people never witness firsthand.

And Trump speaks to them in a big way:

RD: A friend who moved to West Virginia a couple of years ago tells me that she’s never seen poverty and hopelessness like what’s common there. And she says you can drive through the poorest parts of the state, and see nothing but TRUMP signs. Reading “Hillbilly Elegy” tells me why. Explain it to people who haven’t yet read your book.

J.D. VANCE: The simple answer is that these people–my people–are really struggling, and there hasn’t been a single political candidate who speaks to those struggles in a long time. Donald Trump at least tries.

What many don’t understand is how truly desperate these places are, and we’re not talking about small enclaves or a few towns–we’re talking about multiple states where a significant chunk of the white working class struggles to get by. Heroin addiction is rampant. In my medium-sized Ohio county last year, deaths from drug addiction outnumbered deaths from natural causes. The average kid will live in multiple homes over the course of her life, experience a constant cycle of growing close to a “stepdad” only to see him walk out on the family, know multiple drug users personally, maybe live in a foster home for a bit (or at least in the home of an unofficial foster like an aunt or grandparent), watch friends and family get arrested, and on and on. And on top of that is the economic struggle, from the factories shuttering their doors to the Main Streets with nothing but cash-for-gold stores and pawn shops.

The two political parties have offered essentially nothing to these people for a few decades. From the Left, they get some smug condescension, an exasperation that the white working class votes against their economic interests because of social issues, a la Thomas Frank (more on that below). Maybe they get a few handouts, but many don’t want handouts to begin with.

From the Right, they’ve gotten the basic Republican policy platform of tax cuts, free trade, deregulation, and paeans to the noble businessman and economic growth. Whatever the merits of better tax policy and growth (and I believe there are many), the simple fact is that these policies have done little to address a very real social crisis. More importantly, these policies are culturally tone deaf: nobody from southern Ohio wants to hear about the nobility of the factory owner who just fired their brother.

Trump’s candidacy is music to their ears. He criticizes the factories shipping jobs overseas. His apocalyptic tone matches their lived experiences on the ground. He seems to love to annoy the elites, which is something a lot of people wish they could do but can’t because they lack a platform.

The last point I’ll make about Trump is this: these people, his voters, are proud. A big chunk of the white working class has deep roots in Appalachia, and the Scots-Irish honor culture is alive and well. We were taught to raise our fists to anyone who insulted our mother. I probably got in a half dozen fights when I was six years old. Unsurprisingly, southern, rural whites enlist in the military at a disproportionate rate. Can you imagine the humiliation these people feel at the successive failures of Bush/Obama foreign policy? My military service is the thing I’m most proud of, but when I think of everything happening in the Middle East, I can’t help but tell myself: I wish we would have achieved some sort of lasting victory. No one touched that subject before Trump, especially not in the Republican Party.

Also this:

And what do you have to say to liberals?

Well, it’s almost the flip side: stop pretending that every problem is a structural problem, something imposed on the poor from the outside. I see a significant failure on the Left to understand how these problems develop. They see rising divorce rates as the natural consequence of economic stress. Undoubtedly, that’s partially true. Some of these family problems run far deeper. They see school problems as the consequence of too little money (despite the fact that the per pupil spend in many districts is quite high), and ignore that, as a teacher from my hometown once told me, “They want us to be shepherds to these kids, but they ignore that many of them are raised by wolves.” Again, they’re not all wrong: certainly some schools are unfairly funded. But there’s this weird refusal to deal with the poor as moral agents in their own right. In some cases, the best that public policy can do is help people make better choices, or expose them to better influences through better family policy (like my Mamaw).

There was a huge study that came out a couple of years ago, led by the Harvard economist Raj Chetty. He found that two of the biggest predictors of low upward mobility were 1) living in neighborhoods with concentrated poverty and 2) growing up in a neighborhood with a lot of single mothers. I recall that some of the news articles about the study didn’t even mention the single mother conclusion. That’s a massive oversight! Liberals have to get more comfortable with dealing with the poor as they actually are.

Read the whole thing.

(Hat tip: Borepatch.)

What’s Happening to Italy’s Banking System?

Wednesday, July 6th, 2016

Yesterday’s Brexit roundup mentioned that Italian banks account for nearly half the bad loans for the entire Eurozone.

Italy is now the heads-on favorite as the most likely instigator of the next global economic crisis. Some analysts are calling it a perfect storm:

Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.

As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory.

And, of course, they’re blaming Brexit rather than all the myriad problems with the EU that caused the Brexit.

Italy’s bank bailout fund might not be enough to beat back the Brexit. More key Italian financial services firms are under pressure and face the potential need to raise capital, leaving Italian government officials and its banking system trying to steer clear of a crisis.

As Italian bank bonds and share prices are seeing their value slammed in the face of rising uncertainty, banks with substantial bad loans are facing greater pressure, with rates around the world slipping into negative territory. It’s an anxiety some in Italy and throughout the European Union may have been hoping would be eased by the Brexit vote last month — but then the U.K. referendum delivered the opposite outcome from the one they had sought.

“Market volatility following the U.K.’s EU referendum result hit the Italian bank sector particularly hard because it is one of Europe’s weakest,” Fitch Ratings analysts said in a July 4 report. “Asset quality pressure is a main driver for the negative outlooks on several large and medium-sized Italian banks.”

The Brexit vote, which calls for the United Kingdom to abandon a European Union that has careened for years from one crisis to another, could hasten weak Italian banks’ downfall. It was widely expected that European and U.K. banks will suffer the brunt of the vote in late June, and while British banks have been hard hit by the news — which brings with it tremendous regulatory uncertainty — EU banks have suffered as well.

Many banks in Italy, including its largest, UniCredit SpA, have seen share prices pounded; its stock is down more than 60 percent so far this year. A staffer at UniCredit could not provide comment when contacted.

Already, Italian officials and executives appear to be pulling out all the stops to stave off banking sector contagion. The lingering question for banks is whether they can continue to support lending operations at a time when creditors face potential losses and as some of the country’s leading financial services firms could be subject to shotgun M&A marriages by regulators.

Italian financial services firms earlier this year established a multi-billion dollar fund called Atlante to buy non-performing bank loans. But the fund, which is in the 4-billion euro to 6-billion euro range ($4.43 billion to $6.65 billion), one analyst said, is far too small to cover all the non-performing loans held by major Italian banks. However, the fund could still be leveraged in order to support loan purchases.

“The authorities need to get banks to remove a large portion of soured loans from their books so they can loan more,” said Julien Jarmoszko, senior research manager at S&P Global Market Intelligence. “If investors fear more Italian banks, this will raise their cost of capital and reduce lending as a result.”

Look for some sort of holding action for temporary recapitalization (including a “bail in” or some sort of ECB scheme) to let all the insiders dump their bad debts onto the European taxpayer, which was the real point of prolonging the Greek farce.

More news on that front:

  • Atlante already took control of Veneto Banca after “a €1bn capital increase demanded by EU bank regulators attracted zero interest.” And Atlante may have to tap pension funs for further recapitalization.
  • Italy has also banned short-selling of imploding Banca Monte dei Paschi di Siena SpA. That’s never a good sign, and it never works for long.
  • “It’s bad – non-performing bank loans have risen to 18%. At 10%, most banks are technically bankrupt. That’s the percentage of capital and pledged deposits they have against bad loans. Our pledged deposits, not theirs. At 18%, they’re no longer “technically” bankrupt. They ARE bankrupt! Greece still has bad or non-performing bank loans of 34%, Ireland 19% and Portugal 12%. And we haven’t seen the next serious financial crisis yet.”
  • And bank bailouts could hit Italian sovereign debt right in the bond ratings. “Italian ratings are already at BBB- for S&P, though we must also add that DBRS still ranks the country at AL. Still, if these ratings start to come under pressure from the agencies, this could lead to speculation that Italy may eventually fall out of the investment grade bucket. This would have a major impact – in the first place in terms of the eligibility of Italian bonds for the PSPP.” That’s the European Central Bank’s public sector purchase program.
  • Of course, when push comes to shove, we’re likely to see all sorts of banking rules get thrown out the window…

    Brexit Update for July 5, 2016

    Tuesday, July 5th, 2016

    While the reverberations from the Brexit vote are still being heard, here are a few interesting pieces you might have missed:

  • Nigel Farage resigns as head of UKIP. Hey, he fulfilled his victory conditions! What else has he got left to prove?
  • The elites still haven’t gotten over their defeat:

    As several commentators, from Megan McArdle in The Atlantic to Rupert Darwall in National Review, have noticed, many liberal journalists, representing elites throughout the advanced world, have reacted with indignation to the fact that 52 percent of U.K. voters (many without degrees) have rejected the EU system of supranational government of which the elites approve. Naturally, these journalistic spokesmen argue, the common people could not possibly have good reasons for such an act of multinational vandalism. So they must be inspired by, er, racism, xenophobia, fear of globalization, and related other thought-crimes.

    That account doubtless condenses and oversimplifies the elites’ response to the Brexit shock, which is just one small skirmish in a new class war in advanced societies between geographically mobile, liberal, skilled, high-earning professionals and more rooted, communitarian, particularist, and patriotic citizens (or what British journalist David Goodhart calls “nowhere” people and “somewhere” people). “Nowhere” people simply didn’t grasp the outlook of “somewhere people” in the referendum, not seeing that many decent people who voted for Brexit had such respectable anxieties as loss of community or, one step up, the transformation of their country as motives for casting their votes. So the elites thought the worst. They were still making the same mistake in their television and columnar explanations of the result on Friday morning. But what was remarkable was the Darwall-McArdle thesis that in other countries the elites reacted to the Brexit shock as if personally or spiritually affronted in their own lives. Alarmed, they asked: Why weren’t we told that they might vote for Brexit?

    It’s a hard question to answer.

    One aspect of it, however, is ideologically fascinating. Among the central arguments of those favoring Brexit was that the Brussels system was dangerously undemocratic and that British voters and MPs had lost the power to propose, amend, or repeal failed or oppressive laws. This was a passionate concern among English people who had grown up in a self-governing democracy, who may have fought for it in wars, and who simply couldn’t understand why the loss of their democratic rights didn’t worry their opponents. Yet again and again liberal journalists treated this passionate belief as either abstract or a cover for more primitive emotions and bigotries. Democracy as such was rarely given weight in Remain or liberal debates on the cost/benefit analysis of Brexit. They treat multinational political institutions as such unalloyed goods that it would be impolite to raise questions about such defects as a democratic deficit. Has the knowledge class/meritocracy/cognitive elite/nowhere people/etc., etc. developed not only an intellectual snobbery towards the rest of society, but even an impatient, dismissive contempt for democracy that cannot be openly avowed but that does influence its other political attitudes?

  • “Bigotry! Nativism! Racism! That’s what elites in Britain, Europe and here have been howling, explanations for why 52 percent of a higher-than-general-election turnout of British voters voted for their nation to leave the European Union. But there is plenty of bigotry, condescension and snobbery in the accusations and the people making them. And it’s incoherent to claim, as some do, that it’s undemocratic for voters to decide. That amounts to saying that ordinary people should be content to be ruled by their betters.” (Hat tip: Director Blue.)
  • “I think it’s shocking and appalling to assume because I voted to leave the EU that I’m racist.”
  • Even countries that aren’t contemplating leaving the EU (like France) are demanding changes to EU policies…and threatening to simply stop obeying them. There’s also this tidbit: “Italy’s banks are saddled with 360 billion euros ($401.18 billion) in bad loans.”
  • More on the same subject. “In Italy, 17% of banks’ loans are sour. That is nearly 10 times the level in the U.S., where, even at the worst of the 2008-09 financial crisis, it was only 5%. Among publicly traded banks in the eurozone, Italian lenders account for nearly half of total bad loans.”
  • If the UK can leave the EU. why can’t we leave the UN?
  • London Banker Bonuses Set to Shrivel as Brexit Hits Dealmaking.” My heart bleeds…
  • And what is the UK leaving behind? “EU bans claim that water can prevent dehydration.” Finally someone with the guts to stand up to Big Dihydrogen Monoxide! (Hat tip: Daddy Warpig’s Twitter feed.)
  • Texas vs. California Update for June 28, 2016

    Tuesday, June 28th, 2016

    Welcome to another Texas vs. California update!

  • California’s skyrocketing housing costs, taxes prompt exodus of residents.” “During the 12 months ending June 30, the number of people leaving California for another state exceeded by 61,100 the number who moved here from elsewhere in the U.S.” Plus this: “The majority of the people we are seeing are moving to states that don’t have state income taxes.” And this “My husband’s salary would be in the six figures, but six figures is not enough to cover the rent, day care (and) food prices.” (Hat tip: Pension Tsunami.)
  • The middle class can no longer afford to live in the Bay Area.
  • “Orange County’s public city employees earned $144,817 on average last year.” (Hat tip: Pension Tsunami.)
  • In a completely unrelated story, lavish pension hikes have resulted in exploding levels of Orange County debt. (Hat tip: Pension Tsunami.)
  • “City employees working full-time in Long Beach earned an average of $128,731 in total compensation last year.” (Hat tip: Pension Tsunami.)
  • “A survey of 45 cities in Riverside and San Bernardino counties shows the average full-time city worker received $127,730 in pay and benefits last year.” (Hat tip: Pension Tsunami.)
  • On paper, Nevada County, California, is technically insolvent (which is the best kind of insolvent.) (Hat tip: Pension Tsunami.)
  • As good as Texas is doing compared to California’s profligacy, the people at the Texas Public Policy Foundation think the budget is still growing way too fast.
  • “Jacobs Engineering Group, one of the world’s largest engineering companies, is preparing to move employees from its Pasadena [CA] headquarters to Dallas, becoming the latest major corporation to relocate significant operations from California to Texas.”
  • “A California-based orthopedic goods manufacturer and distributor has decided to move its Ohio-based distribution hub to Dallas/Fort Worth International Airport, which will give the company a place to significantly expand operations and possibly relocate its West Coast headquarters. The company, Santa Paula, California-based Hely & Weber, has signed a lease totaling nearly 40,000 square feet of space at 755 Regent Blvd. in Dallas/Fort Worth International Airport.”
  • Still more companies leaving California. Plus why the “Bernie Sanders effect” will result in a veto-proof majority for Democrats in the California legislature. (Hat tip: Pension Tsunami.)
  • Bankrupt San Bernardino, union fight over settlement payments.” Clip and save this headline, as you’ll be able to use it again and again over the coming years…
  • Marin County pension reformer launches GoFundMe campaign to sue the county over pension increases. Though his $198,000 request strikes me as excessively optimistic…
  • Texas scores three of the top five cities (Houston, Austin, San Antonio) for U-Haul destinations. (Hat tip: Ted Cruz on Facebook.)
  • California Democrats and Social Justice Warriors conspire to drive Christian colleges out of the state. (Hat tip: Ace of Spades HQ.)
  • Once again, California leads the nation…in car thefts.
  • Which lead to this: “More than 71 percent of all recovered stolen cars in 2005 in Texas, New Mexico, Arizona, Nevada, and California were stolen by illegal aliens or by ‘transport coyotes,’ those who bring in illegals across the Mexican border.”
  • “Paul Tanaka, once one of the most powerful law enforcement officials in Los Angeles County, was sentenced Monday to five years in federal prison for interfering with an FBI investigation into jail abuses by sheriff’s deputies.” (Hat tip: Dwight.)
  • Oakland police chief resigns because at least 14 Oakland police officers (and 10 other law enforcement officers had sex with the same underage girl. (Hat tip: Ed Driscoll at Instapundit.)
  • And the guy Oakland found to replace him? He lasted…five days.
  • Bay Area law enforcement agencies have lost 944 guns since 2010. Maybe that’s the “gun control” Democrats should be focusing on… (Hat tip: Stephen Green at Instapundit.)
  • Californians face rolling blackouts this summer…some of which could last as much as 14 days.
  • Shuttered California hospital files for Chapter 7 bankruptcy.
  • You could count this Silicon Valley robot pizza technology startup as a win for California, but the subtext here as that many human California pizza workers will never work a day under that new $15 minimum wage…
  • LinkSwarm for June 17, 2016

    Friday, June 17th, 2016

    Today is a quadruple witching hour for markets, so try not to freak out if there’s more than the usual market volatility today.

  • “Obama Is Bringing 100 Syrian Refugees Into U.S. Every Day.”
  • And Syrian refugees are blowing big holes in Sweden’s welfare budget. (Hat tip: Director Blue.)
  • The rich aren’t paying their “fair share,” they’re paying everyone’s share. (Hat tip: Ace of Spades HQ.)
  • Swiss overwhelmingly turn down “guaranteed income,” the latest pie-in-the-sky socialist scheme to rob every Peter to pay every Paul.
  • David Horowitz believes that Donald Trump’s post-Orlando foreign policy speech is a game changer. (Hat tip: Director Blue.)
  • Not a game-changer: Continued vapid liberal cheer-leading for multiculturalism at all costs. (Hat tip: Director Blue.)
  • “Orlando wasn’t about ‘gun violence’ or ‘homophobia.’ It was about Islam. (Hat tip: Director Blue.)
  • Yet another MSM journalist caught lying about guns.
  • “Why it’s called a ‘modern sporting rifle‘ and not an ‘assault weapon.'” (Hat tip: Instapundit, who notes “Remember, none of this is about saving lives. It’s about the cultural domination of the people in flyover country, by their coastal ‘betters’ who get a near-erotic thrill out of such domination, and who are reduced to blind rage whenever their efforts at domination fail.”)
  • Aside: Is the Washington Examiner paying Ashe Schow enough? She’s like some indefatigable writing machine…
  • The Corrosive Politics of the New York Times Editorial Board Led to the Orlando Shooting. (Hat tip: Director Blue.)
  • “Right now the debate seems choked with people who don’t know, are proud of not knowing, and think you’re a redneck gun-nut asshole if you want them to know because they feel very strongly about this.” (Hat tip: Dwight.)
  • No charges for officer Brad Miller. He’s the one who shot the “unarmed teen” who had driving his Jeep through a plate glass window and was in the process of vandalizing cars.
  • And here’s a police shooting where the use of lethal force was clearly justified.
  • JFK and LSD. Meh. It’s not that I think Kennedy wouldn’t have dropped acid given a chance, but Timothy Leary was basically a con man, and we already know that Nina Burleigh is irrational.
  • Wow, believe it or not, still another reason to never visit Oklahoma. “I’m going to need your driver’s license and all the money on your prepaid debit cards.”
  • “The prohibition of comments that are considered biased or hateful is an explicit denial of freedom of speech.” (Hat tip: Ace of Spades HQ.)
  • Australia’s women’s Olympic soccer team defeated by teenage boys.
  • Are shipping containers the future of farming?
  • Your auditor finds huge cost discrepancies in Houston ISD construction costs. Does HISD: A.) Call in an outside auditor, B.) Launch a criminal investigation or C.) Suspend the auditor who found the problems?
  • New UT President Greg Fenves is a vast improvement over Bill Powers merely by being mediocre.
  • Land’s End decides to commit suicide.
  • Father buys car for son to go to college. Son decides to smoke pot and hang with no-good friends instead. Father sells car.
  • You’re not authorized to know the dire secrets of the Amtrak snack car! (Hat tip: Director Blue.)
  • Affluent buyers snapping up Hill Country land and building mansions.
  • Texas vs. California Update for June 2, 2016

    Thursday, June 2nd, 2016

    Time for another Texas vs. California update:

  • Once again, Texas is ranked as the best state for business by CEO Magazine, while California is ranked the worst. (Hat tip: Rider Rants via Pension Tsunami.)
  • This OC Register piece offers an good restatement of the general problem:

    California has earned quite a reputation for being openly hostile to business, as confirmed by numerous studies and surveys. Its plethora of taxes and regulations are driving away legions of entrepreneurs and workers, but they are doing wonders for one segment of the economy: the moving industry. It is almost as though that industry is secretly lobbying the state Legislature for its anti-business policies.

    Joe Vranich, as president of Spectrum Location Solutions, an Irvine business relocation consulting firm, knows all about what drives businesses’ decisions to give up and leave for greener pastures. According to his research, in just the past seven years, approximately 9,000 businesses have decided to leave California or expand their operations out of state. Companies leaving California typically save between 20 percent and 35 percent of operating costs, he concluded.

    Texas has been the biggest beneficiary of California’s business exodus.

    Snip.

    California’s litigious climate has become a common complaint of business owners. No wonder the American Tort Reform Foundation once again named California the No. 1 “Judicial Hellhole” in the nation last year, based on the state’s excessive laws and regulations and a flood of disability access, asbestos and food advertising and labeling lawsuits, frequently more opportunistic attempts at extortion than legitimate attempts to seek justice for victims who have been truly harmed.

    California has proven to be a particularly harsh climate for manufacturing businesses. “Even if California were to eliminate the state income taxes tomorrow, that still would not be enough,” CellPoint Corp. CEO Ehsan Gharatappeh told the Dallas Business Journal of the Costa Mesa company’s move to Forth Worth.

    General Magnaplate Corp., which has made reinforced parts for the aerospace, transportation, medical, oil and other industries for 36 years, decided to shut down its California facility in Ventura altogether. “This is a very sad day for our employees and for my family, who have a long history of job creation in this area, but the simple fact is that the state of California does not provide a business-friendly environment,” CEO Candida Aversenti said in a press release. “Increases in workers’ compensation costs and government regulations, combined with predatory citizens groups and law firms that make their living entirely by preying on small businesses, have left us with no other choice but to shut down our California facility. This is in stark contrast to our New Jersey and Texas facilities, which are flourishing in small business-friendly environments created by the respective local governments and environmental agencies.”

  • Tech layoffs double in the Bay area:

    Yahoo’s 279 workers let go this year contributed to the 3,135 tech jobs lost in the four-county region of Santa Clara, San Mateo, Alameda and San Francisco counties from January through April, as did the 50 workers axed at Toshiba America in Livermore and the 71 at Autodesk in San Francisco. In the first four months of last year, just 1,515 Bay Area tech workers were laid off, according to mandatory filings under California’s WARN Act. For that period in 2014, the region’s tech layoffs numbered 1,330.

  • How did the California city of Irwindale rack up the largest per household market pension debt in the state, at $134,907 per household?
  • Low and negative interest rates means that CalPERS must make risky investments to even come close to hitting their yield targets:

    The nation’s largest public pension fund, the California Public Employees’ Retirement System, has one-fifth of its assets in bonds and is down 1.3% since July 1, according to public documents. The system, known by its abbreviation Calpers, also has 53.1% of its assets in stocks, 9% in real estate and 9.4% in private equity. In 2015, Calpers posted a return of 2.4%, below its target rate of 7.5%.

    Nor is CalSTARS doing much better:

    The nation’s second-largest public pension plan, the California State Teachers’ Retirement System, has shifted a significant amount of money away from some stocks and bonds to protect against a downturn. It moved assets into U.S. Treasurys and so-called liquid-alternative funds, which mimic hedge-fund strategies. Calstrs, as the pension is called, reported gains of 1.5% during a choppy 2015, with returns on its fixed-income investments up just 0.6%.

    (Note: WSJ link, so you may need to do the Google thing.)

  • News: Former CalPERS chief executive Fred Buenrostro convicted of bribery. California: Buenrostro will continue to receive his CalPERS pension while in prison. (Hat tip: Pension Tsunami.)
  • Overview of the Texas budget.
  • UnitedHealth exits California’s Obamacare exchanges.
  • Despite that, California wants to offer ObamaCare subsidies to illegal aliens.
  • California also wants to spend more money to send illegal aliens to college.
  • And those illegal aliens with California driver’s licenses still aren’t purchasing liability insurance.
  • Hate California traffic? Tough:

    The newest outrage comes from the Governor’s Office of Planning and Research in the form of a proposed “road diet.” This would essentially halt attempts to expand or improve our roads, even when improvements have been approved by voters. This strategy can only make life worse for most Californians, since nearly 85 percent of us use a car to get to work. This in a state that already has among the worst-maintained roads in the country, with two-thirds of them in poor or mediocre condition.

    Snip.

    In essence, the notion animating the “road diet” is to make congestion so terrible that people will be forced out of their cars and onto transit. It’s not planning for how to make the ways people live today more sustainable. It has, in fact, more in common with Soviet-style social engineering, which was based similarly on a particular notion of “science” and progressive values.

    (Hat tip: Instapundit.)

  • Toyota’s Plano headquarters takes shape.
  • The UAW is making a big push to unionize Tesla’s Fremont plant.
  • Speaking of Tesla, they’re approaching the grand opening of their giant battery factory…in Nevada.
  • McDonald’s CEO says a $15 minimum wage will make his restaurants shift to using robots. But what would McDonald’s know about minimum wage workers?
  • In the same vein, it’s no wonder that Whole Foods opened it’s first semi-automated Whole Foods 365 store in Los Angeles. “Promoted as a ‘chain for millennials,’ the new ‘365’ stores use about one-third less square footage than the company’s traditional 41,000-square-foot Whole Foods stores, but they also slash almost two-thirds of workers with robots and computerized kiosks.” (Hat tip: Director Blue.)
  • Schedule for California high speed rail boondoggle pushed back four more years. Latest obstacle: wealthy equestrians. “Hey, this study says horses won’t mind a super-fast, super loud train zipping along right next to them.” “You mean the study from the institute that two bullet train authority members sit on? Get stuffed!”
  • “The State Assembly Subcommittee on Education voted Tuesday to delay funding to the UC system because of concerns with the UC Retirement Plan, proposed by UC President Janet Napolitano in March, which would cause the university to incur significant costs. The delay was announced after an actuarial report was released earlier that day by Pension Trustees Advisors, or PTA, which showed that the retirement plan would cost the university $500 million in savings, or $34 million a year, over the next 15 years.” (Hat tip: Pension Tsunami.)
  • Maywood, California (which had previously outsourced services to the corrupt city of Bell) is on the brink of bankruptcy. (Hat tip: Dwight.)
  • “Two L.A. sheriff’s deputies convicted of beating mentally ill inmate.”
  • San Francisco liberals versus the city’s police union
  • “Another aviation company has decided to move its corporate headquarters to Fort Worth to take advantage of the Lone Star state’s business friendly environment and the city’s longtime history in the aerospace industry. The move is historic for Burbank, California-based C&S Propeller — an FAA and EASA certified repair station for propeller and airplane maintenance — which has been in California for nearly five decades.”
  • This one’s a wash: XCOR lays off employees in both California and Texas.
  • Life in Venezuela is Murder

    Thursday, May 12th, 2016

    In the course of this piece on Venezuela’s bankrupt socialist government using tanks against “paramilitary” opposition, I came across this tidbit of crime information:

    The homicide rate in Venezuela is surging again in 2016, the Prosecutor General’s office warned in its first quarterly report of the year last week. Venezuela suffered 18,000 homicides in 2015 according to the Prosecutor General, but NGO’s put that figure closer to 28,000 murders for last year.

    Even given that Latin American murder rates are generally higher than North America and Europe, that’s shockingly high for a nation of 30 million. In fact, both figures are more murders than for all of the United States for 2013 (the last year full FBI figures are available). And U.S. figures include such idyllic peaceful environs as Chicago, Baltimore and Detroit.

    And life for Venezuelans who aren’t outright murdered continues to get worse. “The experiment with “21st-century socialism” as introduced by the late President Hugo Chavez, a self-described champion of the poor who vowed to distribute the country’s wealth among the masses, and instead steered the nation toward the catastrophe the world is witnessing under his handpicked successor Maduro, has been a cruel failure.”

    What our country is going through is monstrously unique: It’s nothing less than the collapse of a large, wealthy, seemingly modern, seemingly democratic nation just a few hours’ flight from the United States.

    In the last two years Venezuela has experienced the kind of implosion that hardly ever occurs in a middle-income country like it outside of war. Mortality rates are skyrocketing; one public service after another is collapsing; triple-digit inflation has left more than 70 percent of the population in poverty; an unmanageable crime wave keeps people locked indoors at night; shoppers have to stand in line for hours to buy food; babies die in large numbers for lack of simple, inexpensive medicines and equipment in hospitals, as do the elderly and those suffering from chronic illnesses.

    But why? It’s not that the country lacked money. Sitting atop the world’s largest reserves of oil at the tail end of a frenzied oil boom, the government led first by Chavez and, since 2013, by Maduro, received over a trillion dollars in oil revenues over the last 17 years. It faced virtually no institutional constraints on how to spend that unprecedented bonanza. It’s true that oil prices have since fallen—a risk many people foresaw, and one that the government made no provision for—but that can hardly explain what’s happened: Venezuela’s garish implosion began well before the price of oil plummeted. Back in 2014, when oil was still trading north of $100 per barrel, Venezuelans were already facing acute shortages of basic things like bread or toiletries.

    The real culprit is chavismo, the ruling philosophy named for Chavez and carried forward by Maduro, and its truly breathtaking propensity for mismanagement (the government plowed state money arbitrarily into foolish investments); institutional destruction (as Chavez and then Maduro became more authoritarian and crippled the country’s democratic institutions); nonsense policy-making (like price and currency controls); and plain thievery (as corruption has proliferated among unaccountable officials and their friends and families).

    A case in point is the price controls, which have expanded to apply to more and more goods: food and vital medicines, yes, but also car batteries, essential medical services, deodorant, diapers, and, of course, toilet paper. The ostensible goal was to check inflation and keep goods affordable for the poor, but anyone with a basic grasp of economics could have foreseen the consequences: When prices are set below production costs, sellers can’t afford to keep the shelves stocked. Official prices are low, but it’s a mirage: The products have disappeared.

    When a state is in the process of collapse, dimensions of decay feed back on each other in an intractable cycle. Populist giveaways, for example, have fed the country’s ruinous flirtation with hyperinflation; the International Monetary Fund now projects that prices will rise by 720 percent this year and 2,200 percent in 2017. The government virtually gives away gasoline for free, even after having raised the price earlier this year. As a result of this and similar policies, the state is chronically short of funds, forced to print ever more money to finance its spending.

    Though much of it will be familiar to anyone who follows this blog, read the entire story, if only for the factory owner who got in trouble for not stocking his bathrooms with toilet paper as per union rules (because it was unavailable at government stores), only to get in even more trouble for “hoarding” when he bought it on the black market…

    Texas vs. California Update for May 10, 2016

    Tuesday, May 10th, 2016

    Time for another Texas vs. California update:

  • In a fiscal test of which states are best prepared for the next recession, Texas ranked best and California ranked worst. (Hat tip: Jack Dean of Pension Tsunami.)
  • And California didn’t just flunk the test, it flunked it badly. (Ditto)
  • A big reason is the top-heavy nature of income tax receipts. “Nearly half of the state’s personal income tax revenue comes from the top 1 percent of earners — 150,000 individual tax returns. And personal income tax revenue is 65 percent of total revenue, which means the One Percent provides 33 percent of the state’s total revenue.”
  • Here’s a handy comparison of Texas vs. California debt ratios using a number of different metrics. You can also look at several different metrics with the general pension tracker tool, put together by the Stanford Institute for Economic Policy Research. (Hat tip: Pension Tsunami.)
  • The same source tells us that California has the third highest market/pension debt ratio in the country, while Texas ranks 34th.
  • “During the Great Recession and since, Texas has been America’s jobs engine, creating 34 percent of all U.S. civilian jobs during the last eight years in a state with less than 10 percent of the nation’s population.”
  • Moody’s downgrades bond ratings for the Pasadena Unified School District right when the district passes a 6% salary increase.
  • Reno is increasingly benefiting from companies relocating from California.
  • Texas company wants to store California’s nuclear waste.
  • “In 2014, a study by the conservative American Enterprise Institute found that full-career state workers in five states — California, New Mexico, Oregon, Texas and West Virginia — earned more in retirement income than in their final salary.” I’m pretty sure Texas salaries on average were significantly lower than California’s, and that there were less of them…
  • Court strikes down California Attorney General Kamala Harris’s unconstitutional attempt to compel conservative nonprofits to reveal their donors. (Hat tip: Ace of Spades HQ. )
  • Bay area law enforcement offices have “lost” over 500 guns since 2010.
  • The headquarters for Jamba Juice is relocating from Emeryville, California to Frisco, Texas. (Hat tip: Jack Dean of Pension Tsunami.)
  • The U.S. headquarters for Mitsubishi Heavy Industries relocated from New York to Houston.
  • LinkSwarm for May 6, 2016

    Friday, May 6th, 2016

    Still digesting the Trump victory and what it means. In the meantime, have some links:

  • Roger Simon thinks Republicans should take a time out. Pretty much what I said a few days ago, though Simon is saying we should take a week rather than a day. Still good advice. (Hat tip: Director Blue.)
  • Trump is the warning shot. He’s the food riots before the revolution. He’s the stack of letters to the editor in protest over some issue. People do not go from happy to bloody revolt overnight. It’s a process and the early stages are warnings, at least they should be viewed as warnings. If the people in Washington insist on flooding the country with helot labor, despite what’s happening in the election, the people are going to insist on building scaffolds in Washington. The Trump phenomenon is the warning.” (Hat tip: Director Blue.)
  • Five reasons why Trump might do better than expected. (Hat tip: Real Clear Politics.)
  • “The Hillary Story is far less entertaining than The Trump Story…Clinton is rich, and morally and ethically corrupt. So is Trump. But at least he’s entertaining.” Note: That’s from Jonah Goldberg, with whom Trump has exchanged numerous rounds of insults and putdowns. Goldberg seems much further along the Kubler-Ross cycle than his NRO compatriots…
  • How Hillary Clinton plans to disarm Americans. (Hat tip: Director Blue.)
  • How the liberal welfare state destroyed black America. Not news to anyone who’s read Charles Murray’s Losing Ground (which came out over 30 years ago), but how many have? (Hat tip: Ed Driscoll at Instapundit.)
  • North Carolina to the Obama Administration: Bite me.
  • Germany wants its own army controlling Europe. I think we’ve all seen that movie before…(Hat tip: Director Blue.)
  • Larry Correia visits Europe. “I would like to institute autobahn style rules on I-15 in Utah. Sure, a few thousand people would probably die in the first weekend, but after that it would be awesome….The Czechs are a fun people. They have this kind of to hell with it sense of humor that meshes really well with mine. They’re big on long meals and animated conversations. They really hate socialists.”
  • Former McDonald’s CEO says that a $15 minimum wage will mean replacing humans with robots and self-service kiosks. But what would he know about fast food? (Hat tip: Ed Driscoll at Instapundit.)
  • Research following contestants on The Biggest Loser brings bad news about dieting: “As the years went by and the numbers on the scale climbed, the contestants’ metabolisms did not recover. They became even slower, and the pounds kept piling on. It was as if their bodies were intensifying their effort to pull the contestants back to their original weight.”
  • Everything you know about Ty Cobb is wrong. (Hat tip: Borepatch.)
  • Venezuela’s So Poor Soldiers Steal Goats To Survive

    Thursday, May 5th, 2016

    For all the depression over an ascendant Donald Trump, let’s remember remember that a lot of other countries, much further down the road to serfdom than we are, have it much worse.

    Take, for example, Venezuela, where The Magic Power of Socialism™ has so wrecked the economy that soldiers are stealing goats to survive:

    Over the weekend, six members of the Venezuelan military were detained by local authorities for stealing goats, the Venezuelan newspaper El Nacional reported Sunday. It said the soldiers confessed to stealing the goats and said they did it to feed themselves, since they had no food left in their barracks.

    “It’s not a good sign when your military doesn’t have enough food, and when the military has been relegated to guarding and protecting food lines,” said Jason Marczak, director of the Latin America Economic Growth Initiative at the Atlantic Council. “This is endemic of the problems going on across the country.”

    A military without enough food to eat. Boy, that’s a swell recipe for happiness in Latin America. (Hat tip: Instapundit.) As the Washington Post‘s Wonkblog put it: “It’s a grim race between anarchy and civil war.”

    Venezuela’s opposition evidently has enough votes to recall idiot socialist President Nicolas Maduro:

    Venezuela’s right-wing opposition coalition, the Democratic Unity Roundtable (MUD), turned over 1.8 million signatures in support of a recall referendum against President Nicolas Maduro to the National Electoral Council (CNE) on Monday.

    As part of the initial requirement to solicit a recall, the MUD was given 30 days to collect signatures from 1 percent of the electorate in each of the 23 states– 197,721 total signatures nationwide– a target which the coalition managed to surpass in a matter of days, accruing as many as 2.5 million overall.

    There are still considerable barriers to a recall election even if the government doesn’t cheat (and what are the odds of that?).

    Also, beer production has stopped. Just an all-around recipe for for happiness.

    So cheer up, America! We have to face the horror of a Clinton-Trump presidential race, but at least we’ll do so with food, water, electricity and beer…