Economics Thread

[Garmel]

If DC was a state they would be the highest.

[nsacpi]

I've lived in both Florida and California. More recently in California. I think any metric that shows California and Florida as the two states having the highest poverty rates in the country is just crazy. It's only saving grace is that it is crazy in a bipartisan kind of way.

[Garmel]

I've lived in both Florida and California. More recently in California. I think any metric that shows California and Florida as the two states having the highest poverty rates in the country is just crazy. It's only saving grace is that it is crazy in a bipartisan kind of way.

Because there's big money in certain spots and as I've seen from you you pretty much see what you want to see. Cal is leading the nation in homelessness too. You can't blame the metrics on that.

My Texas is high too which doesn't surprise me. You wouldn't know that while living on the I-35 corridor like I do because we're well off here. However, if you go to east and south Texas it's a whole different animal. If you go to one of our border towns you would think you're in the 3rd world instead of Texas.

[nsacpi]

Because there's big money in certain spots and as I've seen from you you pretty much see what you want to see. Cal is leading the nation in homelessness too. You can't blame the metrics on that.

My Texas is high too which doesn't surprise me. You wouldn't know that while living on the I-35 corridor like I do because we're well off here. However, if you go to east and south Texas it's a whole different animal. If you go to one of our border towns you would think you're in the 3rd world instead of Texas.

I have a feeling it is they're both big states with some areas having high costs of living and others not. So if you live in a low wage/low cost of living part of the state applying the state average of cost of living is going to generate what looks like a high poverty rate. Same reasoning would apply to other big (and heterogenous) states like Texas and New York.

[Garmel]

You could have a point there but you have to realize those states like Texas/Cal with large illegal populations will have issues with poverty.

[nsacpi]

You could have a point there but you have to realize those states like Texas/Cal with large illegal populations will have issues with poverty.

California obviously is not working for a lot of people. Mostly due to the cost of housing. As I've said they need to figure it out. The politics is not easy due to nimbyism and the fact that people who already own a house don't want to see prices come down. When I talked to my mother a few days ago she was complaining about cheaper housing going up in her town. Mrs Nimby.

[acesfull86]

https://thehill.com/opinion/finance/...epresentation/

On retirement, Sanders delivers a litany of misrepresentation

In a recent op-ed written for Fox News, Sanders made one of his favorite claims: “In America today, almost 45 percent of older Americans between the ages of 55 and 64 have no savings at all and no idea how they will be able to retire with any shred of dignity or respect.” Sanders attributes this figure to the Government Accountability Office (GAO), which calculated it from the Federal Reserve’s Survey of Consumer Finances. So it’s rock solid, right?

In fact, not at all. What Sanders calls “retirement savings” are only balances in retirement accounts such as IRAs and 401(k)s. But there are many other ways to save.

What about state and local government employees who have generous traditional pensions but may not be offered a retirement account? They’re without savings, Sanders says, despite having accrued $9.3 trillion in future pension benefits. This is indeed ironic, given that Sanders’ op-ed was released in conjunction with a committee hearing focused on expanding Americans’ access to traditional pensions, which Sanders’ oft-cited statistic does not consider to be “retirement savings” 

And what about people who save for retirement outside of a formal retirement plan? Another Fed dataset, the Survey of Household Economics and Decisionmaking, asks specifically about these other sources of retirement savings.

Among 55 to 64-year-olds in 2022, 58 percent reported having retirement savings in an ordinary taxable investment or savings account, 14 percent owned real estate that would generate income in retirement and 19 percent owned a small business that could generate retirement income. In total, 90 percent of Americans aged 55 to 64 in 2022 told the Fed they had some form of retirement savings, dwarfing the 55 percent figure Sanders cites.

But it goes on, with Sanders’ claiming that Americans have “no idea how they will be able to retire with any shred of dignity or respect.” The Fed’s Survey of Household Economics and Decisionmaking sheds light on the claim as well.

Among households aged 65 in 2022, just 4 percent described their financial situation as “finding it hard to get by,” with another 13 percent “just getting by.” Eighty-two percent said they were “doing okay” or “living comfortably,” up from 62 percent when the survey began in 2013. Moreover, seniors report much higher financial security than younger Americans.

But it keeps going: according to the Organization for Economic Cooperation and Development, Sanders says, the United States has “one of the highest rates of senior poverty compared to other wealthy nations.” Twenty-three percent of U.S. seniors live in poverty, Sanders claims.

That would be news to the U.S. Census Bureau, which in a 2023 analysis using IRS data found just 6.4 percent of U.S. seniors with income below the federal poverty threshold. The OECD figures Sanders cites are not measures of poverty as commonly understood but of inequality. The OECD sets the poverty threshold differently for each country, at anything less than half that country’s median disposable income. And yes, the U.S. has greater income inequality than most developed countries.

But the OECD finds that the typical U.S. senior has the second-highest disposable income in the world, trailing just the tax-haven city-state of Luxembourg. Our median senior’s income is 50 percent higher than Denmark, 29 percent above Germany and double that of Japan. Does it make sense that to avoid “poverty” a U.S. senior needs twice the real income of a Japanese retiree?

In reality, Census Bureau researchers have found dramatic reductions in elderly poverty even since 1990, with the share of seniors with sub-poverty level incomes falling from 9.7 percent in 1990 to just 6.4 percent in 2018.

[Carp]

btw any plan that successfully stimulated supply and lowered the price of housing would create a whole new set of political headaches...it would not be popular among the people who already own houses

Anyone that owns a home, looking to sell said home, would likely find that the houses they are wanting to buy have also collectively come down. If a rising tide lifts all boats, a low tide certainly lowers all boats.

[nsacpi]

Anyone that owns a home, looking to sell said home, would likely find that the houses they are wanting to buy have also collectively come down. If a rising tide lifts all boats, a low tide certainly lowers all boats.

2007-2010 had a lot of thangs happening so it might be unfair to cite that period...but homeowners generally do not look back fondly on that period

people like to complain about high house prices...until they start falling

[Garmel]

California obviously is not working for a lot of people. Mostly due to the cost of housing. As I've said they need to figure it out. The politics is not easy due to nimbyism and the fact that people who already own a house don't want to see prices come down. When I talked to my mother a few days ago she was complaining about cheaper housing going up in her town. Mrs Nimby.

Cal is number one in the nation in homelessness, unemployment, and people leaving the state.

It's not a stretch to think the poverty rate is the worst in the nation.

Stats relying on COL might not be perfect (nothing is) but you sure as hell can't trust anything that doesn't have it factored in.

[nsacpi]

in spite of its manifest problems real per capita GDP in California was 36% higher than Florida in 2010 and 53% higher in 2022.

it is what it is

i'm glad to see the concerns about income inequality and homelessness and the high cost of living...California seems to work pretty well for some people...not so well for others

[Garmel]

in spite of its manifest problems real per capita GDP in California was 36% higher than Florida in 2010 and 53% higher in 2022.

it is what it is

No doubt Cal has big money. The problem is when you're a little guy trying to make a living there.

[nsacpi]

No doubt Cal has big money. The problem is when you're a little guy trying to make a living there.

then you move to nevada or idaho

it makes sense

i don't think it reflects well on California...they should be concerned about their economy not working well for middle and lower income people

[sturg33]

[nsacpi]

Consumer Price Index for Medical Care

1997 to 2010 up 65%

2010 to 2023 up 41%

Looks like the curve got bent.

Bigly.

[acesfull86]

https://reason.com/2024/03/27/the-ob...idge-disaster/

Until the bridge's wreckage can be cleared away, the Port of Baltimore is cut off from the Chesapeake Bay, the Atlantic Ocean, and the global supply chains beyond. It remains unclear how long the port will be closed, but federal Transportation Secretary Pete Buttigieg said Wednesday that there could be a "long and difficult path" ahead.

In the meantime, trade flowing through the port will have to be redirected to other ports along the East Coast. That's a disruption that could mean higher costs and other complications—and it is a particularly acute issue for the roughly 15,000 workers who earn a living off the commerce that passes through Baltimore's port.

Clearly, there's every reason to make sure the port can be reopened as quickly as possible. Buttigieg acknowledged as much on Wednesday, and said the White House had given a "clear directive" to "tear down any barriers, bureaucratic as well as financial."

But Buttigieg stopped short of naming any specific federal regulations that might be waived to speed along the recovery efforts in Baltimore. Here's one that should go right to the top of the list: The Foreign Dredge Act of 1906.

The Foreign Dredge Act is an older cousin to the more well-known and infamous Jones Act, which bans foreign-built ships from moving goods between American ports. As a result, it drives up shipping prices to places to Puerto Rico and Hawaii, adds traffic to American highways, and leaves sizable parts of the country without access to natural gas.

Like the Jones Act, the Foreign Dredge Act is a purely protectionist law that forbids foreign-built dredges—vessels built to remove debris from waterways and to deepen and widen shipping channels—from operating in the U.S. Any foreign dredge caught doing work in American waters is subject to immediate forfeiture.

The law was originally meant to protect American dredge-building companies from foreign competition. More than a century later, however, the primary outcome of the Foreign Dredge Act has been severely curtailing the number of dredges available to do important work like removing the wreckage of the Key Bridge. Many that are in use are sub-standard compared to the rest of the world. The Army Corp of Engineers is still using dredges built in the 1930s, for example, while a recent study from Tulane University found that "the combined capacity of the U.S. [hopper dredge] fleet is less than a single EU [European Union] dredging vessel."

Being shielded from competition means American dredge-building companies haven't needed to keep up with developments made elsewhere in the world. Clearing away the debris and reopening the Port of Baltimore is likely to depend on outdated equipment, and will therefore likely take longer than it otherwise might.

Waiving the Foreign Dredge Act now might help in some small way—perhaps better dredges can be brought in from Canada or somewhere else nearby—but the collapse of the Key Bridge is a great reminder that we shouldn't wait until there's a crisis to start undoing bad laws. It would have been better to repeal the Foreign Dredge Act five or 10 or 50 years ago, so that America would already have access to the best dredging technology in the world.

When there's not a crisis, the Foreign Dredge Act is still a problem. It is one of the main reasons why American ports generally have smaller shipping channels and lower capacity than ports in other parts of the world. Those marginal costs might be easy for policymakers to ignore during normal times, but the closure of the Port of Baltimore should throw this problem into stark relief.


—————

Score another win for protectionism! Although, this law is only 118 years old…not sure if the protectionists agree we’ve had quite enough time to properly analyze the consequences. In the meantime, rest easy knowing there are no commie Canadian dredges contaminating our harbors.

[thethe]

Reach reach reach

[sturg33]

https://reason.com/2024/03/27/the-ob...idge-disaster/

Until the bridge's wreckage can be cleared away, the Port of Baltimore is cut off from the Chesapeake Bay, the Atlantic Ocean, and the global supply chains beyond. It remains unclear how long the port will be closed, but federal Transportation Secretary Pete Buttigieg said Wednesday that there could be a "long and difficult path" ahead.

In the meantime, trade flowing through the port will have to be redirected to other ports along the East Coast. That's a disruption that could mean higher costs and other complications—and it is a particularly acute issue for the roughly 15,000 workers who earn a living off the commerce that passes through Baltimore's port.

Clearly, there's every reason to make sure the port can be reopened as quickly as possible. Buttigieg acknowledged as much on Wednesday, and said the White House had given a "clear directive" to "tear down any barriers, bureaucratic as well as financial."

But Buttigieg stopped short of naming any specific federal regulations that might be waived to speed along the recovery efforts in Baltimore. Here's one that should go right to the top of the list: The Foreign Dredge Act of 1906.

The Foreign Dredge Act is an older cousin to the more well-known and infamous Jones Act, which bans foreign-built ships from moving goods between American ports. As a result, it drives up shipping prices to places to Puerto Rico and Hawaii, adds traffic to American highways, and leaves sizable parts of the country without access to natural gas.

Like the Jones Act, the Foreign Dredge Act is a purely protectionist law that forbids foreign-built dredges—vessels built to remove debris from waterways and to deepen and widen shipping channels—from operating in the U.S. Any foreign dredge caught doing work in American waters is subject to immediate forfeiture.

The law was originally meant to protect American dredge-building companies from foreign competition. More than a century later, however, the primary outcome of the Foreign Dredge Act has been severely curtailing the number of dredges available to do important work like removing the wreckage of the Key Bridge. Many that are in use are sub-standard compared to the rest of the world. The Army Corp of Engineers is still using dredges built in the 1930s, for example, while a recent study from Tulane University found that "the combined capacity of the U.S. [hopper dredge] fleet is less than a single EU [European Union] dredging vessel."

Being shielded from competition means American dredge-building companies haven't needed to keep up with developments made elsewhere in the world. Clearing away the debris and reopening the Port of Baltimore is likely to depend on outdated equipment, and will therefore likely take longer than it otherwise might.

Waiving the Foreign Dredge Act now might help in some small way—perhaps better dredges can be brought in from Canada or somewhere else nearby—but the collapse of the Key Bridge is a great reminder that we shouldn't wait until there's a crisis to start undoing bad laws. It would have been better to repeal the Foreign Dredge Act five or 10 or 50 years ago, so that America would already have access to the best dredging technology in the world.

When there's not a crisis, the Foreign Dredge Act is still a problem. It is one of the main reasons why American ports generally have smaller shipping channels and lower capacity than ports in other parts of the world. Those marginal costs might be easy for policymakers to ignore during normal times, but the closure of the Port of Baltimore should throw this problem into stark relief.


—————

Score another win for protectionism! Although, this law is only 118 years old…not sure if the protectionists agree we’ve had quite enough time to properly analyze the consequences. In the meantime, rest easy knowing there are no commie Canadian dredges contaminating our harbors.

As you know, the 119 years of data cannot be used. We must view it from post-bridge collapse world, and there simply hasn't been enough time for us to understand the effectiveness

[chop2chip]

But do the boats transport lipstick?