A Modest Proposal

(It occurs to me that some readers -- particularly younger ones who have studied English-language writers only since the banishment of Dead White Males from the university curriculum -- may be unfamiliar with the reference in the title to the classic 1729 essay by Jonathan Swift.  If you haven't read it, here is a link.  As you will see, my proposal is considerably more modest.)

I will not be the first to point out the clear signal sent by President-elect Trump with many of his cabinet appointments of an intent to reverse major policies of the Obama administration in many areas.  To consider just a few examples:

•  Department of Education.  Its mission under Obama (and to be fair, under prior Presidents as well) has been to use the piles of free federal money to prop up overpriced and ineffective unionized government schools so that the unions can maximize their revenue, and any and all reforms can be avoided.  Trump nominee Betsy DeVos is a leader in advocating for charter schools and school choice, and is a bete noire of the teachers' unions.
• Department of Housing and Urban Development.  Its mission under Obama (and again, also under prior Presidents) has been to provide subsidized apartments to people deemed to be poor, and thereby keep those people trapped in poverty and dependency for their entire lives.  Trump nominee Ben Carson has been a leading advocate for reducing dependency on the government among poor people, and particularly among blacks.
• Department of Energy and EPA.  Their mission under Obama has been supporting and funding global warming alarmism, subsidizing uneconomic intermittent energy sources, and trying to put energy from fossil fuels out of business.  Energy Secretary-designate Rick Perry actually advocated eliminating the Department of Energy during his own presidential campaign.  EPA Administrator-designate Scott Pruitt has spent years initiating lawsuits against EPA seeking to strike down some of its major regulations.

So, when the new guys at the top come in, can they just turn these agencies around and start with new policies?  If you read the Constitution, the answer would seem to be, of course they can!  (Article II, Section 1: "The executive power shall be vested in a President of the United States of America.")  But realists will recognize that there are only a handful of political appointees at the top of each department or agency, while the thousands of "permanent" or "career" employees are protected against firing by civil service laws.  And somehow these people think that, while the political appointees come and go, the career employees are the ones who really run the place.

How bad will be the resistance to change?  We got a preliminary indication a couple of days ago after the Trump "landing team" for the Energy Department sent a 74-part informational questionnaire to the department.  One of the areas of inquiry was a request for the names of department staffers who had worked on "climate change" programs.  Does that request seem reasonable to you?  It did not seem reasonable to the current DOE or its staffers.  They have "rejected" these requests for information.  From The Hill on December 13:

The Department of Energy said Tuesday it will reject the request by President-elect Donald Trump’s transition team to name staffers who worked on climate change programs.  Energy spokesman Eben Burnhan-Snyder said the agency received “significant feedback” from workers regarding a questionnaire from the transition team that leaked last week.  “Some of the questions asked left many in our workforce unsettled,” Snyder said.

Well, I guess that's how it works in the Federal Government:  If the requests of your new boss make you "unsettled," you just "reject" them.  And if that's how they react to a simple request for information as to who is doing what, imagine how they are going to react when they actually get an assignment to do something that runs counter to what they think should be done! 

The article in The Hill goes on to quote from the employees' union boss, articulating the view that there is nothing political about this, and the staffers are just neutral, a-political experts trying to go about their jobs:

“My members are upset and have questions about what this means. These are all civil servants who do their jobs,” Tony Reardon, national president of the National Treasury Employees Union, said in a statement.  “They have no wish to be caught up in political winds — they are nonpartisan employees — scientists, engineers, statisticians, economists and financial experts — who were hired for their knowledge and they bring their talent and experience to the job every day,” he said, adding that the union “will do all it can to ensure that merit system rules are followed.”

Actually, no.  There is absolutely nothing "nonpartisan" about this.  The Department of Energy is substantially if not entirely engaged in carrying out policies that are favored by Democrats and opposed by Republicans -- policies like promoting and subsidizing wind and solar energy and hamstringing and restricting fossil fuels.  Do you think that even the Energy Information Agency is nonpartisan?  Don't be ridiculous.  Their "levelized cost of energy" reports are carefully engineered to defraud the American people into supporting "renewable" energy by downplaying the real costs of wind and solar energy by a factor of five or ten or more.  The same overt or covert partisanship is equally if not more true at Education, HUD, EPA, and, for that matter, throughout the government.  

How bad is the partisanship in the government?  Surely, you say, there must be at least a few Republicans in the government who can be counted on to keep things fair!  If you think that, you are deluding yourself.  Analyze the election results from the District of Columbia, and you come away realizing that virtually every single person who works for the federal government is a Democrat.

Here are the presidential results from the District of Columbia.  Hillary Clinton got 90.9% of the votes, a percentage far higher than her percent in any of the fifty states.  (Her highest percentage in any of the states was in Hawaii at 62.3%.)  Donald Trump and Gary Johnson between them won just 5.7% of the votes in D.C., about 17,600 votes in total.  But think about this:  Washington has a substantial Republican establishment.  The RNC is headquartered in DC.  The Republicans held substantial majorities in both the House and Senate before the recent election, and the Republican members of Congress plus their committees had something in the range of 4000 staffers based in the District.  And those people have families.  And there is a substantial group of Republican, conservative and libertarian think tanks and policy organizations based in D.C. -- as examples, consider the Heritage Foundation, Cato Institute, American Enterprise Institute, Federalist Society, and so forth.  And their staffers also have families.  Add up all the professional and paid Republican and conservative-side people in Washington and their families, and you have accounted for literally every Republican vote in the District.  The number of Republicans actually working in the government has to be so small that you will need a microscope to find them.

And yes, it is absolutely reasonable to expect that every single one of the government employees regards Trump and his people as illegitimate interlopers, and those employees will do everything in their power to hinder and obstruct any agenda of reform.

So, what to do about it?  The obvious first answer is, fire these people and hire new ones who will do your bidding.  Unfortunately, that is likely to be a poor answer.  The so-called "civil service" protections for career federal employees go back to the 1880s.  Do they violate the constitutional provision that vests all executive authority in the President?  I would say they do, but you could litigate that issue for the entire next four years without getting any definitive result and without getting rid of a single person.  You might even lose outright.

So here's the modest proposal: If the government cannot fire these people, then it can assign them to other tasks in other places.  By fortuitous coincidence, the recent several years have seen downsizing in two sectors known for having very large buildings, many of them located in remote and out-of-the-way areas.  Those two sectors are manufacturing and retail.  Places like rural Ohio, Pennsylvania, Mississippi, Arkansas, and upstate New York -- not to mention northern Maine, North Dakota, South Dakota, Montana, and even Alaska -- are littered with abandoned K-Marts, JC Penney's and Sears stores, as well as abandoned factories of all sorts.  These buildings can be leased for a song.  Hundreds of federal employees can be assigned to each such location.

Send each such employee a memo:  "Starting Monday morning at 9 AM, your job will be located at the former Sears Hometown store, 2308 11th Avenue West, Williston, North Dakota.  If you report for work, you will await such assignments as may be given to you at that location.  If you do not show up, your pay will be continued until your unused vacation and sick leave are exhausted, and then your pay will stop."

Inside the former Sears or K-Mart, there can be row upon row of hundreds of desks and chairs.  But I highly recommend that these employees not be provided with any computer or cell phone at taxpayer expense.  Why waste the money?  They can communicate with headquarters in Washington by U.S. mail.  It's not like they are doing anything productive.

Something tells me that the incoming Trump team will stop short of adopting my proposal.  But they should adopt it.  For the next four years, essentially every federal employee in Washington is going to be conducting an unrelenting guerilla campaign to undermine everything the administration wants to do.  If the administration only pushes back a little, it will be steamrolled by the permanent government Blob.  Time to act decisively!  If anyone can do that, it is Trump.

UPDATE, December 16:  The normally sensible Megan McArdle at Bloomberg View comments on the Trump transition team questionnaire to the Department of Energy (asking for names of DOE employees working on "climate change" matters) as follows:

[The Department of Energy] should not comply with this request unless some law requires it. This request reeks of witch-hunting people because they might have views on climate change that our president-elect, or someone on his staff, dislike. That is no way to run an organization, or a nation.

What?  The incoming administration has an absolute right to find out who is working on what, and to re-direct people from working on Project A to Project B.  Career employees have no "right" to continue to spend taxpayer resources on projects that the newly elected representatives of the people do not want done.  How is this a "witch hunt"?  If the new people do not find out who is working on Project A, and stop that work, and direct the effort over to Project B, then they are not doing their job.

The Impending Collapse Of The Global Warming Scare

Over the past three decades, the environmental movement has increasingly hitched its wagon to exactly one star as the overwhelming focus of the cause, namely "climate change."  Sure, issues of bona fide pollution like smog and untreated sewage are still out there a little, but they are largely under control and don't really stir the emotions much any more.  If you want fundraising in the billions rather than the thousands, you need a good end-of-days, sin-and-redemption scare.  Human-caused global warming is your answer!

Even as this scare has advanced, a few lonely voices have warned that the radical environmentalists were taking the movement out onto a precarious limb.  Isn't there a problem that there's no real evidence of impending climate disaster?  But to no avail.  Government funding to promote the warming scare has been lavish, and in the age of Obama has exploded.  Backers of the alarm have controlled all of the relevant government bureaucracies, almost all of the scientific societies, and the access to funding and to publication for anyone who wants to have a career in the field.  What could go wrong?

Now, enter President-elect Trump.  During the campaign, as with many issues, it was hard to know definitively where Trump stood.  Although combatting climate change with forced suppression of fossil fuels could be a multi-trillion dollar issue for the world economy, this issue was rarely mentioned by either candidate, and was only lightly touched on in the debates.  Sure, Hillary had accused Trump of calling climate change a "hoax" in a November 2012 tweet.  (Actual text: "The concept of global warming was created by and for the Chinese in order to make American manufacturing non-competitive.")  But in an early 2016 interview, Trump walked that back to say that the statement was a joke, albeit with a kernel of truth, because "climate change is a very, very expensive form of tax" and "China does not do anything to help."  Trump had also stated that he intended to exit the recent Paris climate accord, and to end the War on Coal.  So, was he proposing business-as-usual with a few tweaks, or would we see a thorough-going reversal of Obama's extreme efforts to control the climate by fossil fuel restrictions?

With the recently announced appointments, this is starting to come very much into focus.  In reverse order of the announcements:

• Rex Tillerson, CEO of ExxonMobil, as Secretary of State.  As of today, we still have as our chief diplomat the world leader of smugness who somehow thinks that "climate change" caused by use of fossil fuels is the greatest threat to global security.  He is shortly to be replaced with the CEO of Exxon.  Could there be a bigger poke in the eye to the world climate establishment?  I'm trying to envision Tillerson at the next meeting of the UN climate "conference of parties" with thousands of world bureaucrats discussing how to put the fossil fuel companies out of business.  Won't he be laughing his gut out?
• Rick Perry as Secretary of Energy.  Not only was he the longest-serving governor of the biggest fossil fuel energy-producing state, but in his own 2012 presidential campaign he advocated for the elimination of the Department of Energy.  This is the department that passes out tens of billions of dollars in crony-capitalist handouts for wind and solar energy (Solyndra!), let alone more tens of billions for funding some seventeen (seventeen!) research laboratories mostly dedicated to the hopeless task of figuring out how to make intermittent sources of energy competitive for any real purpose.
• And then there's Scott Pruitt for EPA.  As Attorney General of Oklahoma, another of the big fossil fuel energy-producing states, he has been a leader in litigating against the Obama EPA to stop its overreaches, including the so-called Clean Power Plan that seeks to end the use of coal for electricity and to raise everyone's cost of energy.

You might say that all of these are very controversial appointments, and will face opposition in the Senate.  But then, Harry Reid did away with the filibuster for cabinet appointments.  Oops!  Barring a minimum of three Republican defections, these could all sail through.  And even if one of these appointments founders, doesn't the combination of them strongly signal where Trump would go with his next try?

So what can we predict about where the climate scare is going?  Among members of the environmental movement, when their heads stop exploding, there are plenty of predictions that this will be terrible for the United States:  international ostracism, loss (to China!) of "leadership" in international climate matters, and, domestically, endless litigation battles stalling attempts to rescind or roll back regulations.  I see it differently.  I predict a high likelihood of substantial collapse of the global warming movement, both domestically and internationally, over the course of the next couple of years.

Start with the EPA.  To the extent that the global warming movement has anything to do with "science," EPA is supposedly where that science is vetted and approved on behalf of the public before being turned into policy.  In fact, under Obama, EPA's principal role on the "science" has been to prevent and stifle any debate or challenge to global warming orthodoxy.  For example, when a major new Research Report came out back in September claiming to completely invalidate all of the bases on which EPA claims that CO2 is a danger to human health and welfare, and thus to undermine EPA's authority to regulate the gas under the Clean Air Act, EPA simply failed to respond.  In the same vein, essentially all prominent global warming alarmists refuse to debate anyone who challenges any aspect of their orthodoxy.  Well, that has worked as long as they and their allies have controlled all of the agencies and all of the money.  Now, it will suddenly be put up or shut up.  And in case you might think that the science on this issue is "settled," so no problem, you might enjoy this recent round-up at Climate Depot from some of the actual top scientists.  A couple of excerpts:

Renowned Princeton Physicist Freeman Dyson:  'I’m 100% Democrat and I like Obama. But he took the wrong side on climate issue, and the Republicans took the right side. ' . . .

Nobel Prize Winning Physicist Dr. Ivar Giaever: ‘Global warming is a non-problem’ – ‘I say this to Obama: Excuse me, Mr. President, but you’re wrong. Dead wrong.’

Now the backers of the global warming alarm will not only be called upon to debate, but will face the likelihood of being called before a highly skeptical if not hostile EPA to answer all of the hard questions that they have avoided answering for the last eight years.  Questions like:  Why are recorded temperatures, particularly from satellites and weather balloons, so much lower than the alarmist models had predicted?  How do you explain an almost-20-year "pause" in increasing temperatures even as CO2 emissions have accelerated?  What are the details of the adjustments to the surface temperature record that have somehow reduced recorded temperatures from the 1930s and 40s, and thereby enabled continued claims of "warmest year ever" when raw temperature data show warmer years 70 and 80 years ago?  Suddenly, the usual hand-waving ("the science is settled") is not going to be good enough any more.  What now?

And how will the United States fare on the international stage when it stops promising to cripple its economy with meaningless fossil fuel restrictions?  As noted above, people like Isabel Hilton predict a combination of ostracism and "loss of leadership" of the issue, most likely to China.  Here's my prediction:  As soon as the United States stops parroting the global warming line, the other countries will quickly start backing away from it as well.  This is "The Emperor's New Clothes," with the U.S. in the role of the little kid who is the only one willing to say the obvious truth in the face of mass hysteria.  Countries like Britain and Australia have already more or less quietly started the retreat from insanity.  In Germany the obsession with wind and solar (solar -- in the cloudiest country in the world!) has already gotten average consumer electric rates up to close to triple the cost in U.S. states that embrace fossil fuels.  How long will they be willing to continue that self-destruction after the U.S. says it is not going along?  And I love the business about ceding "leadership" to China.  China's so-called "commitment" in the recent Paris accord is not to reduce carbon emissions at all, but rather only to build as many coal plants as they want for the next fourteen years and then cease increasing emissions after 2030!  At which point, of course, they reserve their right to change their mind.  Who exactly is going to embrace that "leadership" and increase their consumers' cost of electricity by triple or so starting right now?  I mean, the Europeans are stupid, but are they that stupid? 

And finally, there is the question of funding.  Under Obama, attaching the words "global warming" or "climate change" to any proposal has been the sure-fire way to get the proposal whatever federal funding it might want.  The Department of Energy has been the big factor here.  Of its annual budget of about $28 billion, roughly half goes to running the facilities that provide nuclear material for the Defense Department, and the other half, broadly speaking, goes to the global warming cause:  crony capitalist handouts for wind and solar energy providers, and billions per year for research at some seventeen (seventeen!) different energy research laboratories.  During the eight Obama years, the energy sector of the U.S. economy has been substantially transformed by a technological revolution that has dramatically lowered the cost of energy and hugely benefited the American consumer.  I'm referring, of course, to the fracking revolution.  How much of the tens of billions of U.S. energy subsidies and research funding in that time went toward this revolution that actually produced cheaper energy that works?  Answer:  Not one single dollar!  All of the money was completely wasted on things that are uneconomic and will disappear as soon as the government cuts off the funding spigot.  All of this funding can and should be zeroed out in the next budget.  Believe me, nobody will notice other than the parasites who have been wasting the money.

If the multi-tens-of-billions per year funding gusher for global warming alarmism quickly dries up, the large majority of the people living on these handouts will have no choice but to go and find something productive to do.  Sure, some extreme zealots will find some way to soldier on.  But it is not crazy at all to predict a very substantial collapse of the global warming scare over the course of the next couple of years.

The environmental movement has climbed itself way out onto the global warming limb.  Now the Trump administration is about to start sawing off the limb behind them.    

Will The Trump Administration Tackle Government-Generated "Fake News"?

At this blog, I have generally used the tag "Government Fraud" to refer to the various intentionally deceptive data and statistics issued by our government to induce the people to support further growth and bigger budgets for the government.  But in the last few weeks we have a new cool term for such intentionally deceptive information masquerading as news, namely "fake news."  OK, I'll adopt the term for the time being.

As discussed in Friday's post, the people coining the term "fake news" seem to think that the big problem is a few crank websites vying for attention on social media, while at the same time they seem to be completely unaware that far and away the biggest purveyor of fake news is the government itself.  The list of government-generated intentionally deceptive data and statistics is long and dishonorable.  I gave a few examples in Friday's post, and further, I have argued that all of the most important government statistics are fraudulent, including prominent examples like how the poverty rate is calculated, how government spending is accounted for in GDP, and how government debt obligations are reported (failing to accrue anything for Social Security and Medicare liabilities). 

A recent and extreme example of government-generated fake news is the reporting of comparative costs of various forms of energy (e.g., coal, oil, natural gas, wind, solar) in the form of so-called "levelized costs."  I wrote two posts about this in August, here and here.  A prime goal of the Obama administration has been to use government levers of regulations and subsidies to put the fossil fuel industry out of business and replace fossil fuel energy generation with so-called "renewables."  To get public support for that plan, the government has needed a metric for comparing the costs of fossil-fuel energy versus "renewables" that will make the renewables appear much cheaper than they actually are.  The "levelized cost" metric serves this function. 

"Levelized cost" as used in the government reports addresses only what the next kilowatt hour of energy from this source will cost.  In the case of the fossil fuel plant -- which can generally be turned on or off as needed to generate power -- that metric is a fair proxy for the cost of getting reliable electricity from a working electricity system consisting mostly of this type of source.  But in the case of, for example, wind turbines, the "levelized cost" of electricity from a certain turbine gives you little to no indication of what it will cost you to get reliable electricity from a working system mostly fueled mostly by wind turbines.  That's because a working electricity system fueled mostly by wind turbines requires additional massive costs that a fossil fuel system does not:  huge excess capacity (perhaps 300 - 400%) to deal with conditions of light wind; gigantic batteries to store power for conditions of no wind at all, which can persist for days; extra transmission lines to bring electricity from windier areas to the rest of the country; and finally, an entire array of fossil fuel back-up plants for those occasions when the wind doesn't blow for a week and the batteries are dead.  

As I reported at this post, a demonstration project by a South Korean utility to create a functioning electricity system mostly fueled by wind ended up with costs on the order of ten times the costs of the conventional system, by the time the excess capacity, storage and fossil fuel back-up were taken into account.  Oh, and over the course of a full month, the experimental system only generated 42% of its electricity usage from wind.

And yet, check out the big report out from the Energy Information Agency in August.  The title, "Levelized Cost and Levelized Avoided Cost of New Generation Resources in the Annual Energy Outlook 2016," tells you all you need to know.  Look at the charts starting on page 6, and you will find that for energy sources you might be considering investing in today, wind is always reported to be the cheapest, generally about 10% less than the next cheapest which is natural gas.  Coal and oil are up from there.  But, you ask, if I want to have a system mostly relying on wind, how much excess capacity will I need?  How much battery storage will I need?  How much extra transmission capacity will I need?  How much fossil fuel back-up will I need?  How much will those things cost?  How much will those things increase the cost of electricity?  You will find no answers to those questions here.  Please, this is not real news, it is fake news.  They are hoping that you are not smart enough to ask the relevant questions, and that you will be deceived.

And now for the big question:  Do we have any reason to think or hope that the new Trump administration can penetrate through the barrage of fake news coming out of these government agencies and start basing policy on real information?  In the case of many of the issues I have been harping on over the years (e.g., poverty rate, GDP, entitlement accruals) I have not yet seen anything to indicate one way or the other.  However, on the specific issue of the costs of renewable versus fossil fuel power, yes, we do have reason to hope.  That reason is found in a questionnaire containing 74 questions that has been submitted by the so-called transition "landing team" at the Department of Energy.  The questionnaire appeared in the Washington Post on December 9 here, and then was analyzed in detail by Willis Eschenbach at Watts Up With That on December 10 here.

Here are questions 55, 56, and 57 from the questionnaire:

55 EIA’s assessments of levelized costs for renewable technologies do not contain back-up costs for the fossil fuel technologies that are brought on-line to replace the generation when those technologies are down. Is this is a correct representation of the true levelized costs?

56 Has EIA done analysis that shows that additional back-up generation is not needed? How does EIA’s analysis compare with other analyses on this issue?

57 Renewable and solar technologies are expected to need additional transmission costs above what fossil technologies need. How has EIA represented this in the AEO forecasts? What is the magnitude of those transmission costs?

Now, I don't have any information on who the people are who put together this questionnaire, and this "landing team" seems to have preceded the naming of Rick Perry as Energy Secretary designate by quite a bit.  But it is immediately evident that these people know what they are doing.  Further evidence of their competence can be found in questions on other subjects, including, for example, questions about DOE's loan guarantees (these were the people who guaranteed the Solyndra loan) and questions about why DOE supports seventeen (seventeen!) different energy research laboratories.  Read Eschenbach's analysis in full at the link.

The more I see from the Trump transition effort, the more I am impressed by it.

The Fake News And The News That's Fake

It seems that Hillary's supporters just can't accept that she lost because she was a terrible candidate -- a worse candidate even than Donald Trump!  So the election must have been stolen from her by some fraudsters or crooks.  Russian hackers!  James Comey!  And now the latest, "fake news."

I follow the news rather closely, and yet somehow this whole "fake news" thing never even rose to my attention until after the election was over.  Now that it seems to be the big thing, I've gone looking for some of it to see if it could really have been anything important in the election.  It does seem that some completely made-up stories circulated widely on social media platforms like Facebook, often with an origin that no one can seem to trace, and other times with origins at sites with names and looks that seem real but are counterfeit.  Many of these "fake news" stories appeared in the weeks and months prior to the election.

Then of course, there is another, closely-related category.  These are the stories that have circulated in the actual mainstream media, with the full weight of their authority and supposed fact-checking, but with no more relation to truth or reality than the "fake news."  Call this second category the "news that is fake."  Many such stories have also circulated at times carefully calculated to attempt to influence a political result.  

I thought it might be fun to compare some examples of the "fake news" to other examples of the "news that is fake."  See which you think are more consequential.

An analysis at Buzzfeed on November 16 finds the following to be the top five "fake news" stories in the three months prior to the election, ranked by what they call "Facebook engagement."

OK, you have to admit that that's a pretty good list.  On the other hand, I seem to have failed to see any of them at the time.  Maybe that's because I avoid Facebook like the plague.  Meanwhile, let's just pull out a tiny smattering from the category of "news that is fake."  For example:

• On September 13 the Census Bureau released figures for things like household income and the so-called "poverty rate" for 2015.  According to the report, in a year when GDP had only increased 2.4% over the prior year, median household income had somehow gone up 5.2%, and the poverty rate had gone down a full 1.3%.  These supposed figures, and others in the report, were literally impossible, and should have elicited extreme skepticism from all serious media.  See my post on the subject here.  But instead, the report became the lead story in literally every major media outlet, from the New York Times here, to the Wall Street Journal here, and many others.  Within a day, John Crudele of the New York Post had revealed the reported figures to be an artifact of methodology changes at Census, carefully buried in the report and timed for maximum impact on the election.  None of the sources that had breathlessly parrotted the Census figures ever issued a correction.
• Whatever you might think about the controversy over supposed man-made global warming, one thing that cannot be disputed is that no connection has been shown between atmospheric warming and extreme weather events, such as hurricanes or floods.  Indeed, the most recent years have seen a remarkable dearth of hurricanes and tornadoes.  In his op-ed in the Wall Street Journal last week titled "My Unhappy Life As A Climate Heretic," Roger Pielke, Jr. pointed out that "There is scant evidence to indicate that hurricanes, floods, tornadoes or drought have become more frequent or intense in the U.S. or globally," and noted that even the politicized IPCC has agreed with that conclusion.  And yet over at the New York Times, with reportage on this subject led by climate crusaders Justin Gillis and Coral Davenport, it is complete gospel that global warming causes increases in extreme weather events.  For example, in the run-up to the recent election, an article from September 8 by Davenport linked "climate change" to "extreme weather" and flooding that had just occurred in Louisiana.  Just today, we have another article by Davenport attacking Trump EPA nominee Scott Pruitt and containing this gem:  "Without additional government policies, energy and environmental experts say, the shift from coal, oil and natural gas will not be rapid or substantial enough to stave off the worst impacts of a warming atmosphere, including rising sea levels, more powerful storms, more devastating droughts and food and water shortages."
• Or, consider the mother of all "news that is fake" stories, the report by Dan Rather and CBS News on September 8, 2004, in the run-up to the 2004 election between George W. Bush and John Kerry, that Bush had committed certain misconduct, including disobeying a direct order, in connection with his service in the National Guard.  The report was based on obviously forged documents.  Those behind the report, including Rather and his producer Mary Mapes, continued to defend it for years afterward.  Mapes wrote a book defending the story in 2005, and a movie based on that book, titled "Truth," came out in 2015.

If we had all day here, I could come up with another dozen examples just as good.  Is there any doubt that the "news that is fake" category is much more consequential?

More Trade Deficit Craziness

Part of the mission of Manhattan Contrarian is to try to spread to the world some information about basic economic concepts.  I'm not talking here about the kind of economics expertise you would need to get a Ph.D. in the subject, or even a B.A.  Rather I'm talking about simple things that ought to be obvious to all, but somehow aren't.  Things like: that wealth is created by the hard work of the people rather than by government fiat; that the government doesn't make the people as a whole wealthier by increasing taxing and spending; that making investment more costly, difficult and risky (such as by increasing taxes and regulations) impairs economic performance; or that socialism destroys economies by undermining the virtuous incentives of the private property system.  Of course this whole project would be much easier if we didn't have the very most highly-credentialed economists on the public stage constantly spouting total nonsense and fallacy, including as to many subjects on that list.  (I'm talking about the likes of Krugman, Blanchard, et al.)

Anyway, high on the list of things that ought to be obvious is that the money-issuing prerogative of the sovereign is a great advantage, at least if used judiciously.  Certainly, the U.S. government understands this concept in the context of its dealings with its own citizens.  The economy needs money to operate, and as it grows it needs increasing amounts of money; and as long as the increasing money supply stays consonant with the growth of the economy, inflation will stay in check.  

Take a look at statistics on the deficits run by the federal government during the Obama years, and compare those numbers to the increases in debt held by the public.  Over the period 2009 to 2015, the deficits aggregated about $6.7 trillion, while the debt held by the public only went up by about $5.9 trillion.  The difference of about $800 billion (real money!) is what the government was able to spend without increasing the publicly held debt.  Who wouldn't want the ability to do that?

Translate the same concept to the international arena, and suddenly we are talking about a "trade deficit" that somehow is a huge problem.  And thus I was watching some of President-elect Trump's speech in North Carolina last night, and there he was talking about the big trade deficit and what kind of incompetent people could have "negotiated" such a thing.  Going forward, we're going to do much better "deals"!  Huh?

Of course what's going on is that the world needs money for its economy to operate, and the least-incompetent money-issuer in a big economy is the U.S. Federal Reserve.  So the world uses the dollar as its principal money, and it needs an ongoing and increasing supply of them.  To get them, they have to sell us more goods and services each year than they buy from us.  We didn't get into the position of being world money-issuer by sovereign privilege, but functionally it's the same thing.  

Now I for one am very hopeful that Trump will succeed in giving a real and immediate boost to the economy.  As just one example, the announcement today of Oklahoma Attorney General Scott Pruitt to head EPA is a terrific signal that the war on fossil fuels is about to end and the energy economy unleashed.  And the stock market took off and went up almost 300 points.

But what does this mean for the trade deficit?  Of course a rapidly expanding U.S. economy means that the trade deficit is likely to increase, and maybe by a lot.  Here is a post on the subject from yesterday by Mickey Levy of Berenberg Capital Markets.      

For now, the expectation is that the boost in economic activity from likely tax reform, infrastructure spending and an easing of burdensome regulations will stimulate stronger economic growth while increasing the demand for foreign goods and widening the US foreign trade deficit.

And really, if you think about it, Levy is highly likely to be right.  An expanding U.S. economy means more demand by us for imports, and an expanding world economy means more need by them for a growing money supply.  Month by month the trade deficit could bounce up or down, but over a time horizon of quarters or years it will be highly likely to increase, and maybe by a lot.

Relax!  This is a good thing! 

Shaking Up Washington: Ben Carson Edition

One after another, President-elect Trump's cabinet picks have been setting off outrage from the forces of progressivism.  The latest is Dr. Ben Carson, the apparent nominee to head the Department of Housing and Urban Development (HUD).  Wait a minute!  This guy is a neurosurgeon!  What "experience" does he have in the field of government subsidized housing?

And thus the people who recently thought it was no problem at all to have someone with a background as "community organizer" and two years in the Senate as President now seem to think that experience specific to subsidized housing is critical to running one little department of the government.  Here's a small sampling:

The New York Times (one of the more moderate comments):

President-elect Donald J. Trump has picked Ben Carson, a retired neurosurgeon with no housing experience, as his nominee for secretary of Housing and Urban Development — and high anxiety has set in. . . .  [Former Philadelphia Mayor Michael] Nutter, who is African-American . . . calls Mr. Trump’s characterizations of cities “a general insult. . . .”   “I’m proud that I had seven years with President Barack Obama, who actually knew about community development because he was a community organizer,” Mr. Nutter said.

Kevin Drum in Mother Jones (warning: vile left-wing racism):

[Carson] has no qualifications at all. I suppose Trump finally found the one thing Carson wouldn't mind crippling.  The whole thing is kind of weird. My guess is that Trump is pretty desperate to get Carson on his team because he doesn't want the press to be able to say that his cabinet is all white. And Carson is probably the only black person Trump knows aside from Mike Tyson and Don King. But if that's the case, why not offer him HHS? That would make at least some borderline sense since Carson is a doctor. Or maybe Surgeon General. Or the Department of Commerce, since Carson has lots of grifting experience.

Melanie Carlson in The Hill, making a pitch for widespread permanent government dependency:

[The Carson nomination] continues Trump’s pattern of appointing dutiful sycophants that do not have tangible expertise for their given cabinet positions. . . .  Given my area of expertise [as a former shelter based social worker] I would never attempt to do neurosurgery without a few tips. . . .  I would like to provide Carson a little primer from my experience working in shelters and transitioning people to permanent housing.  So the truth: not everyone can even successfully complete current shelter programs; much less have the ability to transition to permanent housing.

Well people, here's the thing:  HUD operates mostly outside of the consciousness of most of the public.  But you only have to look into it for a few minutes to realize that the business of HUD is creating poverty traps to make the supposed "beneficiaries" into government dependents for life.  HUD is not merely a failure as an anti-poverty program; it is a disaster.  It operates substantially on the model of socialism ("to each according to his needs"; assets in public ownership), and it achieves results that would make Cuba or Venezuela or East Germany proud.  Readers here know that HUD's flagship, the New York City Housing Authority, is an unspeakable disaster at every level.  Its properties, housing about 7% of New York City's population, sit on vast acreage of prime real estate -- some of it (e.g., miles of Manhattan waterfront) among the most valuable in the world -- and its residents receive subsidies in many cases worth $50,000 and $100,000 per family per year, and yet the poverty rate in its projects exceeds 50%, turnover is almost non-existent as residents remain in poverty for life, the rents cover barely a third of operating costs and nothing for capital projects or property taxes, and HUD throws some $2 billion down the rathole every year only to maintain the poverty and dependency.

And then there's HUD's latest big initiative, the program known as "Affirmatively Furthering Fair Housing," by which the Obama HUD has sought to force middle-class and wealthy communities around the country to build more subsidized public housing.  Supposedly the theory is that the thing holding back the poor from entering the middle class is isolation in poor inner cities, and once such people are placed in wealthier areas they will begin to rise up.  That's right:  the geniuses at HUD seem not to have noticed that the 120,000 or so of the residents of certain existing projects, otherwise known as the NYCHA residents in Manhattan, despite living in the midst of the wealthiest county in the country, and many of them directly next door or across the street from the very most expensive condos in the country, nevertheless remain mired in poverty for life.  The glaring disproof of the whole theory behind AFFH is right in front of their eyes, and yet they refuse to look and they march forward pushing more of their disaster by force and coercion.

Well, that's what "expertise" and "experience" in the field of publicly-subsidized housing will get you.  It gets you a bureaucracy firmly committed to the socialist model, to be run by themselves of course, in which they can earn cushy life-time salaries while they keep their inferiors trapped in poverty for life.  It gets you a bureaucracy with absolutely no concern or interest whatsoever in ending dependency and getting people out of poverty, but an overriding concern for one thing and one thing only, which is growing their own budgets and staffs and empires year over year.  Are you surprised that the only head of agency they would find acceptable is one of their own -- i.e., someone with the right "experience"?

We know what the people who have "experience" with existing subsidized housing programs will inevitably achieve for us:  the same thing that they have always achieved, which is demanding more money to keep failing by doing the same thing and continuing to trap more people in poverty and dependency.

Where is Carson on any of this?  He hasn't had a whole lot to say specifically on the subject of subsidized housing, but here is a relevant statement from a 2015 speech:

Dr. Ben Carson kicked off the Conservative Political Action Conference, telling an attentive audience that the next President must "get rid of dependency" that some Americans might have on the U.S. government.  "We need to understand what true compassion is to reach out to individuals who think that being dependent is reasonable as long as they feel safe," said Carson, the first speaker to address this year's annual keynote conservative conference. "It's not compassion to pat them on the head and say, 'There, there, I'm going to take care of all your needs, your health care, your food.' That's the opposite of compassion."

You can see why The Blob would hate and fear this guy.  Sounds like a good appointment to me.

At the Manhattan Institute's City Journal Online, Howard Husock calls Carson "just the man for that job," and lays out a program for Carson to implement on taking office.  The program includes things like time limits for living in public housing, bringing private management to projects, and ending the ridiculous AFFH.  Fair enough, as far as it goes.  But even Husock stops short of calling for radical surgery.  How about just giving away the projects to the residents and getting out of the business?