By Lambert Strether of Corrente.
“Obama is readying one final push for approval of the Trans-Pacific Partnership… And though the odds may be long, a presidency defined by partisan stalemate may yet secure one last legacy — only because of Mr. Obama’s delicate alliance with the Republicans who control Congress” [New York Times]. “Delicate” is another one of those bullshit tells. For the operational definition of “delicate,” see the next link.
“[L]et’s look at one special group of Representatives who can swing this vote: the actual lame-ducks, i.e., those who will be in office only until Jan. 3. It depends partly on how many lose their election on Nov. 8, but the average number of representatives who left after the last three elections was about 80. Most of these people will be looking for a job, preferably one that can pay them more than $1 million a year. From the data provided by OpenSecrets.org, we can estimate that about a quarter of these people will become lobbyists. (An additional number will work for firms that are clients of lobbyists)” [Mark Weisbrot, The Hill]. “So there you have it: It is all about corruption, and this is about as unadulterated as corruption gets in our hallowed democracy, other than literal cash under a literal table. These are the people whom Obama needs to pass this agreement, and the window between Nov. 9 and Jan. 3 is the only time that they are available to sell their votes to future employers without any personal political consequences whatsoever.”
“[A]s a result of the campaign-influenced climate in Congress, “I don’t hold out a lot of hope that we can get TPP done — but that doesn’t mean that I can’t be wrong,” Heitkamp said. While President Barack Obama is driving for a vote, “I think it’s going to be a challenge'” [Politico]. Pesky voters! (This post says the same thing as the above two, in different words. It’s an invitation to horsetrading, pure and simple. Come on down!
“‘For the simple reason that the U.S. invested so much in it, the deal acquired a kind of totalistic value that goes way beyond its economic merits,’ said Euan Graham, a former U.K. foreign officer who studies regional security at the Lowy Institute for International Policy in Sydney. ‘To leave Asian partners hanging now would be disastrous for U.S. leadership in the region'” [Wall Street Journal, “U.S. Faces Setback in Asia if TPP Trade Deal Doesn’t Pass”]. Shorter: Take one for the team, little people! Oh, and I really like “totalistic value.”
“The celebrity- and musician-laden ‘Rock Against the TPP’ tour swung through Portland and Seattle this weekend — but not everyone was pleased to see the likes of actress Evangeline Lilly and Rage Against the Machine guitarist Tom Morello take the stage against the trade deal. The Seattle-based Washington Council on International Trade said it was ‘disappointed’ by the effort to block the TPP and called the event ‘a blow to Washington jobs and businesses’ [Politico]. Harrumph.
“Key ingredients of opposition to free trade? Prejudice and nationalism” [WaPo]. “But social science reveals that rational economic calculus has some competitors in shaping citizens’ opinions on globalization.” Shorter: It’s OK for the 10% to screw working people because all working people are — let’s just cut the blather, shall we? — racist. Expect this study to be pushed heavily, and note the straw man of “rational economic actor.” Because if you’re an Acela rider and you like your latté made with Fair Trade coffee beans along with your artisanal chocolate, that makes you a virtuous cosmopolitian, but if you build air conditioners and don’t want to see your job shipped to the global South, you should throw Momma in a home, move to the big city, and become a symbol manipulator. “Rational economic calculus,” my Sweet Aunt Fanny.
“New Abedin Emails Reveal Hillary Clinton State Department Gave Special Access to Top Clinton Foundation Donors” [Judicial Watch]. This is not 14,900 “emails and documents” linked to under “Hairball”; that’s a different storyline altogether. I hate to quote a press release, but so far as I know, Judicial Watch doesn’t make stuff up, and our famously free press is totally in the tank. So herewith:
Judicial Watch today released 725 pages of new State Department documents, including previously unreleased email exchanges in which former Hillary Clinton’s top aide Huma Abedin provided influential Clinton Foundation donors special, expedited access to the secretary of state. In many instances, the preferential treatment provided to donors was at the specific request of Clinton Foundation executive Douglas Band.
The Abedin emails reveal that the longtime Clinton aide apparently served as a conduit between Clinton Foundation donors and Hillary Clinton while Clinton served as secretary of state. . In many instances, Clinton Foundation top executive Doug Band, who worked with the Foundation throughout Hillary Clinton’s tenure at State, coordinated closely with Abedin. In Abedin’s June deposition to Judicial Watch, she conceded that part of her job at the State Department was taking care of “Clinton family matters.”
Included among the Abedin-Band emails is an exchange revealing that .
Hoo boy. Hopefully Trump’s campaign team can stick a sock his mouth so this can dominate a news cycle?
“While Clinton is expected to make only two public appearances before the end of August, she and her top backers will mingle with donors at no fewer than 54 events according to a fundraising schedule obtained by The Associated Press” [AP]. Strange body language for a candidate who’s already won.
“Republicans have continued gaining ground in recent months in voter registration in Florida, Pennsylvania, North Carolina and Iowa, while the late surge in Democratic registrations relative to Republican registrations that occurred in battleground states during the final months of the 2012 election had not been replicated in numbers released in early August” [Politico].
“The Senate is up for grabs again in November, just two years after Republicans took control of the chamber for the first time since 2007. Making the task tougher for the GOP: Republicans are defending 24 seats, compared with 10 for the Democrats. And most of the roughly dozen Senate seats considered the most competitive are currently held by Republicans—many in states won by President Barack Obama” [Wall Street Journal, “Senate Races to Watch in the 2016 Election”]. “If Democrats keep the White House, they only need to pick up four seats, since the vice president can break a 50-50 tie in the Senate. Here are 12 races to watch and the current outlook for each, based on merged ratings from four major election handicappers.”
UPDATE “‘If he loses, [he’ll say] ‘It’s a rigged election.’ If he wins, he’ll say it was rigged and he beat it. And that’s where this is headed no matter what the outcome is,” said one Trump ally. ‘If Donald Trump loses, he is going to point the finger at the media and the GOP establishment. I can’t really picture him giving a concession speech, whatever the final margin'” [Politico]. Given that the GOP establishment — modulo, apparently, the RNC, at least so far — is trying to McGovern him, and what the media gaveth, the media tooketh away, it’s hard to see how Trump’s all that wrong. Ditto, given that the DNC rigged the primaries in favor of his opponent, and the press to the left of Brietbart (not that difficult) is in the tank for her, along with the great bulk of the political class. And that’s before we get to election fraud and voter suppression, where both parties have demonstrated organizational capability. The subtext here seems to me something like: If it weren’t for that crazy Trump dude, we could proceed with a clean election, as usual.” That’s very not true.
UPDATE “Clinton aides said their playbook called for a careful balancing act: ignoring or dismissing Mr. Trump’s most outlandish attacks, while also encouraging independent fact-checkers at mainstream news outlets to debunk any that threaten to gain traction.” [New York Times]. “[I]ndependent fact-checkers.” That’s really good. David Brock, cast in the article as “an ardent defender of Mrs. Clinton,” is simultaneously running Media Matters, a putatively independent counter-oppo organization branded as respectable, and Clinton’s million dollar troll operation. Sort of a “one hand launders the other,” Zen-type thing, I guess.
“What Happened Outside the Hall in Philadelphia” [LA Progressive]. Another trip report, with a focus on the demonstrations, not the delegate experience.
“Hal Boyd: Gary Johnson says Mitt Romney would be ‘guaranteed’ a spot in his administration” [Deseret News].
Clinton Email Hairball
“The FBI’s year-long investigation of Hillary Clinton’s private email server uncovered 14,900 emails and documents from her time as secretary of state that had not been disclosed by her attorneys, and a federal judge Monday pressed the State Department to begin releasing emails sooner than it planned in mid-October” [WaPo]. I’m filing this under “Hairball” because these are work-related “emails and documents,” as opposed to (putatively) private emails and documents that Clinton’s lawyers (thought they) destroyed. You know, the ones about yoga lessons and Chelsea’s wedding. This story seems oddly timed, almost as if it was designed bury the Huma Abedin story, filed under “Corruption.”
“At a heated hearing Monday, a federal judge pressed the State Department on when it would release the 15,000 documents uncovered by the FBI during its investigation of Hillary Clinton’s private email server” [CBS]. “Initially, the State Department attorney would not answer Judge James Boasberg’s repeated questions about the number of emails recovered by the FBI. The judge urged the State Department to expedite its review of what is called ‘Disc 1,’ which is one of two discs handed over from FBI to the State Department in late July. The soonest these emails will be released to the public is early October.”
Light stats today.
Chicago Fed National Activity Index, July 2016: ” Last week’s big jump in industrial production together with July’s strong employment report lifted the national activity index to plus 0.27 from June’s revised plus 0.05. The 3-month average is improving but remains negative, at minus 0.10 vs minus 0.12 in June” [Econoday]. “The small dip for the personal consumption & housing component is no surprise given the month’s weakness in retail sales. But even without strength in consumer spending, July proved to be a strong month for the economy.” And: “The economy’s growth improved based on the Chicago Fed National Activity Index (CFNAI) 3 month moving (3MA) average – but remains below the historical trend rate of growth (but well above levels associated with recessions)” [Econintersect]. “This index IS NOT accurate in real time – and it did miss the start of the 2007 recession.” But: “Econintersect considers the CFNAI one of the best single metrics to gauge the real economic activity for the U.S. – and puts the entire month’s economic releases into their proper perspective, although it is almost a month after the fact. It correlates well and historically has lead GDP.”
Industrial Production: “The Federal Reserve Industrial Production & Capacity Utilization report shows industrial production had a 0.7% blowout for July. This is the largest increase since November 2014. Manufacturing production by itself increased 0.5% and was the biggest advance since July 2015. Even mining increased 0.7% for the month. Utilities’ 2.1% increase was due to the very warm weather” [Economic Populist]. “Total industrial production is still below -0.5% from what it was a year ago. July industrial production was 4.9 percentage points above the 2012 average. Industrial production is still way below the very long term 1972-2015 average by -4.1 percentage points.”
Honey for the Bears: “The truth is the economy is most likely already in a recession and there never was a viable economic recovery” [CNBC]. “A closer look at tax receipts over the past few years reveals that the growing number of employed has not had the effect on cash flows to the Treasury that you would expect.” And:
If the employment condition is booming why are payroll taxes falling?
There are a couple of answers to that question and neither is favorable. The BLS numbers are either wrong or the quality of new jobs created must be very poor. The latter response seems the most credible; a combination of an increase in the proportion of part-time workers and full-time jobs that provide lower compensation.
The true employment condition, as well as the quality of those jobs, can be found in the tax receipt story, which is more comprehensive than the BLS’s estimate. But it’s not just payroll taxes that have declined; corporate tax receipts have fallen 12.8 percent year-to-date, while individual taxes are down 0.4 percent.
Again, the only consistent outlier amongst all of the weak data is the monthly Non-Farm Payroll Report. But if the quality of those net new jobs created is extremely poor, then the headline BLS number can be easily reconciled with the economic data points that point towards recession.
The bottom line is that our standard of living cannot be improving when productivity has been negative for three quarters in a row. The economy isn’t getting better while earnings on S&P 500 companies have been negative five quarters in a row, and are projected to come in negative for the 6th time. There can be no real growth when tax policy remains unchanged and receipts are falling.
Grrr! Mosler: “Someone agrees with me!”
Honey for the Bears: “[R]estaurants have been one of the bright spots of the broader retail industry for years now, but recent data suggests business is getting gloomier. NPD Group, a market research firm, found that visits to fast-casual eateries fell in the most recent quarter for the first time since it began tracking them in 2004. Trade publication Nation’s Restaurant News found that sales at publicly-traded restaurants saw a median decline of 1.7 percent in the second quarter” [WaPo]. Article then goes on to cite other series in mitigation. And: “Even though there are plenty of restaurant companies that are still growing, nearly half of them have become less profitable. Analyst sentiment is tepid, considering how positive sell-side analysts tend to be. If analysts are correct in their predictions of continued increases in labor costs, we may well be in for a few years of pullbacks for the sector” [MarketWatch].
Honey for the Bears: “Yield Whores Sell Their Souls” [Across the Curve]. An unusually vivid headline fo AtC! “The WSJ has posted about the desperate measures pension funds will take to garner some returns. In this one the article tells the tale of pension funds who are writing puts on equities to generate income. That strategy works quite well until one day you wake up and it is no longer worker. There will be an inevitable deep decline in equities and the attendant rise in vol will cost these folks dearly.”
Housing: “The housing recovery has really been an odd one. It has been driven by low inventory, anxious builders, and an army of investors. In the end what has occurred is that the homeownership rate is near a generational low, we have 10 million new renter households over the last decade, and home prices are up on relatively low sales volume” [Dr. Housing Bubble]. “How can there be big sales volume when inventory is so constrained? It is a good question to ask. In any market you will have periods of capitulation, where people simply give in. You see it happening in this market where people purchase crap shacks as if taking their medicine when they were a child. The place physically sucks and is overpriced but hey, you need to do it because mommy told you it was the right thing to do. We’ve been in a holding pattern for a couple of years yet last month, sales did take a rather big drop. It was the biggest drop since April 2011. Is this simply an anomaly or are people priced out?… Things can change very quickly. We’ll have to see if this is simply an odd ball month or something bigger.”
Travel: “Compared with July 2015, the U.S. hotel industry’s occupancy decreased 1.0% to 74.4%. However, average daily rate for the month was up 3.6% to US$128.77, and revenue per available room grew 2.5% to US$95.81” [Hotel News]. “This month’s occupancy decline is the sharpest this year, but the ADR growth is the highest (tied with February and June).”
Shipping: “A weak freight environment continues to weigh with some thinking that 2017 may not provide a resurgence of growth” [James Sands, Seeking Alpha]. “Indicators continue to display overcapacity and weak pricing across transports.”
Shipping: “Any hopes that the peak season may simply be running a little late this year appear to be dashed by the continuing slide in freight rates, as evidenced by the Shanghai Containerised Freight Index.The Shanghai Shipping Exchange comprehensive index across all trade lanes fell another 5.8%” [Lloyd’s List].
Supply Chain: “Nike Inc. is taking an unusual path to more completely overhaul its supply chain. The apparel giant is looking past basic vendor-supplier agreements by striking a deal with private-equity firm Apollo Global Management LLC to set up a fully controlled and contained manufacturing and distribution operation. Under the plan, a new apparel supply chain company is purchasing existing Nike apparel suppliers with an eye on creating ‘a more vertically-integrated apparel ecosystem.’ The venture marks a deep dive into the supply-chain business by Apollo, which aims to pull together a global outsourced manufacturing operation under one financial ownership umbrella” [Wall Street Journal].
ETFs: “[W]e’ll review the academic literature on the subject of luck versus skill in mutual fund performance” [John Swedroe, ETFs.com]. “O]nly about 2% of actively managed mutual funds are generating statistically significant alpha. And that’s even before the impact of taxes on taxable investors.”
Today’s Fear & Greed Index: 72 Greed (previous close: 76, Extreme Greed) [CNN]. One week ago: 80 (Extreme Greed). (0 is Extreme Fear; 100 is Extreme Greed). Last updated Aug 22 at 11:58am. Back to mere greed. Confidence fairy on a diet?
Black Injustice Tipping Point
“For leftists to assume, based on BLM’s critiques of Sanders, that the movement is a phenomenon apart from the Left, without a class lens and with nothing to teach it, would be a grave mistake. The movement has exposed, for example, how the neoliberal order uses policing to shift the burden of taxation from those with the most to those with the least. Police nationwide ticket the poor to bring in revenue in low-tax jurisdictions. Officer Darren Wilson’s killing of Michael Brown in Ferguson, and the resulting outpouring of protest led to the exposure of the financial entrapment of poor Black drivers and pedestrians. The Department of Justice concluded that every branch of government in Ferguson was guilty of racial discrimination for targeting African Americans with fines and fees” [In These Times].
“THE RACIAL ECOLOGY OF LEAD POISONING” (pdf) [DuBois Review].
UPDATE “The debate will heat up as more and more black parents in places like Philadelphia, Detroit, Newark, Camden, St. Louis, and Baltimore see their public schools underfunded, understaffed, and losing resources to charters” [Diane Ravitch]. Indeed. It’s also unfortunate that many of the best-known Black Lives Matter activists — the ones who go to the White House — are pro-charter in their employment choices.
UPDATE “In separate conventions over the past month, the N.A.A.C.P. and the Movement for Black Lives, a group of 50 organizations assembled by Black Lives Matter, passed resolutions declaring that charter schools have exacerbated segregation, especially in the way they select and discipline students.” [New York Times]. “They portray charters as the pet project of foundations financed by white billionaires, and argue that the closing of traditional schools as students migrate to charters has disproportionately disrupted black communities.”
Imperial Collapse Watch
“[O]btaining [the Shadow Brokers] documents through hacking into highly secured NSA servers seems less likely than the chance that someone from inside the agency took them. If that person was Edward Snowden, then probably someone with access to his documents could have started his own crusade against NSA. If that person wasn’t Snowden, then it’s either another NSA employee who was disgruntled and frustrated, or a mole for a hostile foreign intelligence agency. For an individual without the protection of the public opinion like Snowden, it must be much harder and riskier to conduct these leaks than for a foreign state actor” [Electrospaces].
“Global Warming Has Now Made the Northwest Passage a Thing” [Slate]. Maybe I should have filed this under shipping.
“The War on Cash” [The Long and Short]. “‘Cashless society’ is a euphemism for the “ask-your-banks-for-permission-to-pay society”. Rather than an exchange occurring directly between the hotel and me, it takes the form of a “have your people talk to my people” affair. Various intermediaries message one another to arrange an exchange between our respective banks. That may be a convenient option, but in a cashless society it would no longer be an option at all. You’d have no choice but to conform to the intermediaries’ automated bureaucracy, giving them a lot of power, and a lot of data about the microtexture of your economic life.”
“Access to Electronic Payments Systems by Unbanked Consumers” [Federal Reserve Bank of Kansas City]. “In 2013, nearly 8 percent of U.S. households, or about 17 million U.S. adults, did not have a checking or savings account (Burhouse and others). Many of these consumers—who are considered “unbanked”—rely heavily on cash to meet their transaction needs. Increasing unbanked consumers’ access to and use of electronic payment products are high priorities among policymakers around the world.”
“Our suburbs fall apart quickly when they are not maintained. The miles of asphalt and concrete roadway, the vast expanse of front and back yards, the facades of fake rock and supposedly maintenance-free vinyl… these all take immense time and spare resources to keep them in order. America’s suburbs are not financially viable, even with the affluent living in them. As the poor become more of a presence there, it’s hard to see how these places can keep from unraveling” [Strong Towns]. “And it’s hard to see America not simply blaming the poor in response. When it takes the income of multiple families to maintain one suburban house, we’re going to see multiple families living in one house. This will occur on streets with several other homes that are abandoned and falling apart completely, thus reinforcing every stereotype of poor people and their willingness — some contend desire — to live sub-normal lives. It will be easy to write them off.”
“[T]his politics of female excellence — however broadly relatable and seemingly unobjectionable — exhibits a disquieting comfort with the status quo” [Jacobin]. “It wins arguments about justice by pegging them to deeply embedded assumptions about meritocracy. It demands no fundamental restructuring of the social order, but instead requests the equal application of the order’s logic. It shoots for a society free of artificial ceilings that stunt the smart, the brave, the driven, the powerful. In a politics of female excellence, what matters most is not justice and its fundamental incompatibility with a population living in fear of rape, but the character of the women in question. Policies that support women and address concrete disadvantages are unnecessary: true feminism empowers women to overcome the disadvantages themselves. Indeed, policy change can be detrimental if it prevents women from realizing their strength.”
“Perhaps real women and children don’t fit into Hillary’s conception of “feminism”? Or, better still, perhaps the real question should be: feminism for whom? Clinton’s domestic track record demonstrates that it is affluent white women who truly are the focus of her brand of corporate neoliberal feminism” [Counterpunch].
News of the Wired
“Branding without walls” [Mozilla Foundation]. I don’t like any of them!
“The Enterprise Media Distribution Platform At The End Of This Book” [Crummy]. Important! Tech at the New York Public Library shows the difference between the web (open, as designed for the browser) and the web (silo-ed, as corrupted by corporate apps). Reasonaby accessible prose, too.
Readers, feel free to contact me with (a) links, and even better (b) sources I should curate regularly, and (c) to find out how to send me images of plants. Vegetables are fine! Fungi are deemed to be honorary plants! See the previous Water Cooler (with plant) here. And here’s today’s plant:
Readers, I know it’s the dead days of August, but if you can, please use the dropdown to choose your contribution, and then click the hat! Your tip will be welcome today, and indeed any day. Water Cooler will not exist without your continued help.