America’s economy is locked in a downward spiral toward socialism.

January 12, 2022

Empty store shelves. Runaway inflation. Labor shortages. Auto production way down for lack of chips. The Federal Reserve ready to start jacking up interest rates and start dumping bonds into the market. And have you noticed what’s happening with the trade deficit?

Probably not, so I’ll fill you in. It exploded in September, soaring to $81.4 billion, crushing the previous record of $73.2 billion set the previous month. As announced by the Commerce Department last week, the trade deficit in November was just shy of that September record. But that doesn’t begin to tell the story. The deficit in manufactured goods soared to a new record of $96.3 billion in November, eclipsing the previous record set only two months earlier by a whopping $5 billion.

Look at this chart of the trade deficit in manufactured goods: https://petemurphy.files.wordpress.com/2022/01/manfd-goods-balance-of-trade.pdf. We’ve been told that those empty shelves are due to Covid-related labor shortages at overseas manufacturing plants. In light of the trade data, that’s clearly a lie! If it were true, imports would be declining instead of shattering records. And the trade data is corroborated by the massive backup of container ships waiting to unload at west coast ports.

The fact is that warehouses across the country are stuffed to the rafters with goods, so much so that they can’t keep track of where everything is. Items that you see missing from the shelves are here in abudant supply, but buried so deep in the warehouse by more recent shipments of other things that they can’t even get at it. As a perfect example, the state of Florida recently discovered a stash of a million Covid test kits that had expired, buried so deep amid other stuff that they had completely lost track of them. So they’ll head straight to the landfill.

Our economy is stuck in a downward spiral. Trade deficits suck money out of the economy – money that can only be pumped back in through deficit spending. A trade deficit of $96 billion per month requires federal deficit spending of at least a trillion dollars per year just to keep it from sinking into recession. The only way to pump that much deficit spending into the economy is through social programs – socialism – that only fuels more demand for imported goods, making the trade deficit bigger. More deficit spending, more inflationary pressure and higher interest rates, more disincentive to work for a living. More labor shortages. More socialism.

The U.S. ran its last trade surplus in1975. Thanks to both parties’ embrace of globalism and free trade since the end of World War II, we’ve now had forty-six consecutive years of trade deficits that have transformed America from the richest country the world had ever seen – the world’s preeminent industrial power – into a skid row bum, begging the rest of the world, especially China, to loan us money by buying our debt. The optimism I felt when the Trump administration recognized the problem and began slapping tariffs on Chinese imports is gone.

There’s no hope that Biden will lift a finger to address the trade deficit. Trump left him a perfect tool to tackle it – the “Phase 1” trade deal with China, in which China itself agreed that if they didn’t meet quotas for increasing the purchases of American-made goods, then the U.S. would slap a 25% tariff on the half of Chinese products that weren’t already hit with tariffs. By the end of 2020 they had failed miserably, making a mockery of the deal. Not only did Biden not follow through on the deal, it was many months before he even acknowledged its existence. With only one month of data left to be tabulated for 2021, China’s performance vs. their obligations is even worse. Still the Biden administration won’t act. Not surprising. Biden’s decades of experience in the Senate make him one of globalism’s architects.


Trade Deficit Down as Exports Rise

December 11, 2021

In a rare bit of good news on trade, as announced by the Commerce Department this week, the overall trade deficit, led by exports of U.S.-manufactured goods, fell by $14.3 billion in October to $67.1 billion. Here’s the chart: https://petemurphy.files.wordpress.com/2021/12/balance-of-trade.pdf. The decline in the deficit was due to a big jump in exports, rising by $16.8 billion to $223.6 billion, shattering the previous record of $215 billion set in May of 2018. The jump in exports was more than enough to offset a $2.5 billion increase in imports, which set a new record of $290.8 billion, the fifth consecutive monthly record.

The best news, however, is that the decline in the trade deficit was led by a decline in the deficit in manufactured goods. Here’s the chart: https://petemurphy.files.wordpress.com/2021/12/manfd-goods-balance-of-trade.pdf. Exports of U.S manufactured goods jumped by $10.3 billion to $125.5 billion, beating the previous record of $119.7 billion set only two months earlier. It was enough to offset an increase in imports of $1 billion to $207.4 billion – also a new record.

Clearly, the new records set by imports debunk the claim by some that the supply chain crisis is due in part to labor shortages caused by the pandemic at foreign manufacturers. That’s a ridiculous claim. We’ve been inundated with a flood of imports that has left warehouses stacked to the rafters.

The slowing increase in manufactured imports and the accelerating increase in manufactured exports is the best news in this report. It may be the early signs of a manufacturing revival in the U.S. and may also explain, at least in part, the “labor shortage” we’ve been witnessing. That, together with massive spending on infrastructure, have combined to attract workers to higher-paying jobs, leaving other industries that are dependent on cheap labor – like the restaurant industry (where over-building is also a likely factor) – unable to attract workers.

However, it remains difficult to draw any hard conclusion on any economic data until the dust from the pandemic and massive government stimulus spending begins to settle.


U.S. Food Deficit Grows Along with Population

November 18, 2021

We were once known as “The World’s Bread Basket.” But no more. My primary interest in trade data is focused on manufactured goods, since a trade deficit in that category of goods supports my theory that, thanks to the inverse relationship between per capita consumption and population density, it’s inescapable that trade with overpopulated nations will yield a trade deficit. However, I’ve also kept an eye on our balance of trade in food, since it could be an indicator of overpopulation in our own country.

As the U.S. population has grown, our trade surplus steadily shrank. By 2015, it was gone. Now, as the population continues to grow (almost all growth in the U.S. population is due to immigration), we now have a growing trade deficit in food. Check this chart of our food trade deficit. The data for 2021 is year-to-date through the month of September. Annualized, the deficit for 2021 will come in at about $21 billion – a record deficit in food for the U.S.

Let’s do some math. In six years, we’ve gone from a balance of trade in food to a deficit of $21 billion. Now, let’s assume that it takes about $10/day to feed a person in the U.S. That’s $3,650 per year. Divide $21 billion by $3,650 and that deficit represents what it takes to feed 5.75 million people. In 2015, our population was 322 million. It’s now 333 million. That’s a growth in the population of about 11 million people.

So, the population has grown by 11 million people in six years, and our food deficit has grown by an amount that it would take to feed half of them. One can conclude that, despite improvements in crop yield, we’re falling further behind in our efforts to feed our own population. We now find ourselves in the position where we have to rely on other “Bread Basket” nations less densely populated than ourselves, like Canada, Australia and South American nations.

It’s a sad state of affairs when America can’t even feed itself any more. Immigrants, pack a lunch and bring a cooler and a basket full of food with you. You’re going to need it.


Inflation / Supply Chain / Worker Shortage Crisis. What the hell is going on?

November 14, 2021

It’s been a while since I’ve posted anything. It’s because I’ve been analyzing the most recent economic data in the hope of being able to relate it in some way to my theory that worsening overpopulation, and trade with overpopulated nations, is driving unemployment and poverty higher – ultimately leading to mankind’s undoing.

I find myself at a loss, however. None of what’s going on in the economy today adds. Finally, I’ve come to the conclusion that it doesn’t make sense because something fishy is going on. So I’m just going to present the data and let you decide for yourself.

Trade Data:

Let’s begin with this chart of our trade deficit in manufactured goods. It had begun to show signs of leveling off until June of 2020 when it took off again, but has leveled off again for the past five months, setting a record in September. The trade deficit with China soared to its highest level since December 2018, as imports rose and as China continued to renege on its commitments to buy U.S. exports, confident that the Biden administration doesn’t have the backbone to enforce the “Phase 1” trade agreement. At any rate, it seems that companies who switched to their secondary suppliers in other countries when tariffs were imposed on China had no choice but to order more from China when those secondary suppliers were unable to keep up with demand. That’s not cheap and surely factored into rising prices.

The soaring trade deficit kind of makes sense. As the pandemic began to bite and as stimulus money fattened up wallets, consumers began to simultaneously hoard some items while soing on a shopping spree for others. Companies increased their orders for foreign goods by $20 billion per month until the supply chain was choked off by a shortage of shipping containers and a glut of cargo ships stalled at inbound ports. Now, here’s a chart of our overall trade deficit. As you can see, it was fairly stable at an average of about $50 billion per month but, sometime around June of 2020, it began to soar, reaching an all-time record of $80.9 billion in September, the most recent month for which trade data is available. That’s a jump of $30 billion per month. The increase in manufactured imports explains most of it. The rest is due to a huge jump in oil imports. In May of 2020, oil imports had fallen to a modern-era record low of $5.95 billion. In September, imports were back up to $18.9 billion and climbing.

Last week I saw a news report that said the number of ships anchored offshore from the port of Los Angeles had risen to over 100. It was also reported that warehouses across the entire U.S. are completely full. So full are the warehouses that truckloads and containers full of goods are being parked in empty lots and anywhere they can legally park.

At the same time, we see rolling product outages of everything on our store shelves, including domestically produced food items. There is talk of turkey shortages and cranberry shortages for Thanksgiving. One day you’ll see an empty shelf where some commonly used item once sat. Next week, that space is full but some other items are now gone. You never know what you’re going to be able to get.

It’s these shortages that are blamed for soaring prices. But how the hell do we have these shortages? The trade data and news reports about ports clogged with offloaded containers and warehouses stuffed to the rafters all paint a picture of a glut of products beyond anything that anyone could ever have imagined.

I’m telling you, something’s not right. I believe global corporations have learned a new trick, using the pandemic as cover to create an illusion of shortages to justify big price hikes, all in an effort to grab up as much government stimulus money as they can. Domestic producers and shipping companies are also capitalizing, and blaming it all on the pandemic – something that was a factor early on but hasn’t been – at least economically speaking – for a long time now.

Employment Data:

The most recent employment data is even more confusing. We see the “help wanted” signs posted on the door of virtually every establishment we walk into. We hear the news reports about shortages of workers in every industry, from manufacturing to fast food. Companies are boosting wages and offering various kinds of “signing bonuses,” yet still can’t attract workers. The worker shortage is constantly cited as the reason behind empty shelves and soaring prices.

But wait a minute. The Labor Department reported last week that unemployment fell to 4.6% in October. That’s a pretty low level of unemployment. In the past fourteen years, it was lower than that for only a three-year period from March of 2017 to March of 2020. And look at this chart of per capita employment, which is essentially the same thing as the “labor force participation rate” which is tracked by the labor department. It fell like a rock at the onset of the pandemic, but has almost completely recovered just as quickly. Today, it stands at the same level as it did in September of 2016. (It has never yet recovered to the level that existed before the global financial crisis of 2008.) In September of 2016, we were in the final months of the 2016 election, and the Democrats were touting the strength of the economic recovery from the financial crisis. Inflation was nearly non-existent. Shelves were fully stocked. Every establishment was fully staffed. Unemployment was 5.0%. So how is it that today, in spite of the fact that the labor climate is almost exactly the same now as it was then, and the fact that we have two million more workers employed today than we did then, shelves are empty, prices are soaring and everyone complains that it’s because of a worker shortage?

I believe part of it can be explained by the explosion in highway construction work and in residential and commercial construction. Perhaps there’s even some element of growth in manufacturing employment as companies grow more disgusted with the global supply chain. I’ve said for a long time that a return to domestic manufacturing would transform the economy, creating millions of high-paying jobs that would siphon workers away from low-paying jobs in industries like fast food. We may be witnessing exactly that kind of transition. If we are, don’t be surprised if vast swaths of the fast food industry and others that provide very little value to consumers disappear. Don’t be surprised if restaurant chains like McDonald’s and Wendy’s bite the dust. How long will customers wait in long lines at drive-through windows before they wake up to the fact that they could pack themselves a brown-bag lunch at a quarter of the price and in one tenth of the time, not to mention the gas wasted and carbon emitted while they sit there with their engines idling for fifteen minutes?

Even so, such a transition in the economy would shift at most maybe five million workers from those low-paying industries to high-paying manufacturing and construction jobs. That’s five million workers out of 160 million. It doesn’t explain how every industry is complaining of a worker shortage. Just take a look around and you can’t help but be suspicious of something fishy. Fast food restaurants with closed dining rooms have “help-wanted” signs at the entrance to their drive-through window. Yet, walk into the Culver’s or Chick-Fil-A right next door and you find them fully staffed.

A big part of the explanation of the supply chain crisis is that trucking companies can’t find enough drivers to move the goods. But then you take a trip in your car and find the truck volume on the interstate highways is worse than you’ve ever seen it.

I could go on, but you get the idea. None of this adds up. You can’t help but wonder: is this fast food restaurant really trying to hire any workers, or is that “help wanted” sign just there to create a phony narrative that justifies their higher prices and your long wait in the drive-through lane? Are these rolling outages on store shelves really due to product shortages, or they engineered to justify higher prices. Are all of these companies using that same narrative to raise prices not because they need to, but to suck up their share of pandemic stimulus money and social spending money that’s pouring into the economy by the trillions?

If you’re a domestic manufacturer of consumer staples, are you going to stand by while manufacturers of televisions, computers, cell phones and others rake in huge profits from people spending their stimulus money, or are you going to get in on the action by creating an illusion of shortages to justify higher prices and profits?

Where are the journalists who should be asking these tough questions? Where are the regulatory agencies who should be overseeing this crap? And why is the Federal Reserve sitting on its hands while inflation escalates out of control?

This whole supply chain/inflation/worker shortage crisis is a bunch of BS that doesn’t add up until you look at corporate profits and then realize that we’re all being taken for a ride.


Supply Chain Chaos Fueled by Overpopulation

October 18, 2021

We’ve all seen the empty shelves in our stores and have had to adapt and substitute as everyday items that we’ve long taken for granted are suddenly out-of-stock. And we’ve heard the stories and seen the pictures of massive back-ups at our ports – shipping containers stacked high and dozens of cargo ships anchored off-shore, waiting to be unloaded. The global supply chain is in chaos. The Covid pandemic is taking the blame because the globalists who created the global supply chain don’t want you to understand the real issues.

The global supply chain is a “system” and, like any system, requires controls to keep it stable. The more variables there are in a system, the more difficult it is to control. Take your car, for example. Maximizing your fuel mileage requires a computer that adjusts the fuel-to-air ratio to any given combination of conditions – air temperature, engine temperature, octane rating of the fuel, throttle position, oxygen level in the exhaust, and so on. When your car is first started, all of these variables are in such a state of flux that it’s impossible to control in such a way that minimizes your fuel consumption. So your car runs in “open loop” mode until the variables settle down. Only then does it go into “closed loop” mode where the computer (using that “chip” you hear so much about that is in short supply because of the global supply chain chaos) can actually fine tune the fuel injectors and spark timing. Any disruption in any variable that’s out-of-range will cause the computer to throw up its hands and default back to open loop mode and your “check engine” light comes on.

That’s just your car. Now think of more complex systems. Think of nuclear power plants, for example. Maintaining precise control is absolutely critical. Loss of control can result in a core melt-down which isn’t just a matter of life and death, it’s an existential threat to everyone and everything within a huge radius. Everything has to work perfectly. Sometimes it doesn’t. A weather event, a power failure, a failed cooling pump, a crack in a pipe, a failed valve and pretty soon you have a Three Mile Island, a Chernobyl or a Fukushima.

Complex systems that experience loss-of-control can deteriorate until they experience a catastrophic failure. Control algorithms can be developed to reduce the risks to an infinitesimal level, but the risks can never be completely eliminated. So there must also be plans in place to mitigate the destruction and clean up the mess.

With all that said, let’s now look at supply chains. You’re a company that needs a widget. You go to a widget manufacturer down the road. “Sure, I can supply you with your widgets. Tell me how many you want and when you need them. Here’s your price.” Pretty simple. Not a global supply chain, though. There’s nothing simple about that. In fact, there may be nothing more complex. The variables are almost infinite. Your manufacturer may be in China, and has a whole supply chain of his own to manage just to make your part. Then there’s obtaining a shipping container, transporting it to a port in China, obtaining and loading a cargo ship, traversing a stormy ocean, dealing with customs, unloading at the port on the west coast, loading your container onto a truck and, after your container has made its way from one distribution center to another, with multiple carriers involved, it’s supposed to make its way to your door just in time – just as you’ve used the very last widget from the previous shipment.

A failure anywhere along the line can throw your whole supply chain out-of-control. So why would you set up such an elaborate supply chain? Sure, the labor may be cheaper at your manufacturer in China, but all of that around-the-world shipping doesn’t come cheap. The fact is, it isn’t cheaper. So why don’t you just get your widget from a local source? Because there isn’t any. There used to be, but they were driven out-of-business by the global supply chain. Wait, you say. That doesn’t make any sense. If the supplier in China isn’t cheaper, then how did they drive the local supplier out of business? They did it by selling at a loss. Why would they do that? Because the purpose of globalism isn’t to reduce the costs for American companies. The purpose is to establish an economy in third world countries, like China, where they have four times as many consumers as the U.S., and turn them into U.S.-style consumers. That way, sales volumes and profits for global corporations grow four times as fast as they would have if they focused only on the American market.

Look at these charts, updated through August, the latest month for which trade data is available: https://petemurphy.files.wordpress.com/2021/10/balance-of-trade.pdf, https://petemurphy.files.wordpress.com/2021/10/manfd-goods-balance-of-trade.pdf. The first is a chart of our overall trade deficit. It’s a perfect representation of the state of our supply chain. Stable until the onset of the pandemic, it’s now out-of-control. If this were a chart of a nuclear power plant’s reactor core temperature, rising as fast as the trade deficit is rising, you’d be in a state of panic if you were an operator at that plant, and lights in the control room would be flashing red. The 2nd chart is more narrowly focused on our deficit in manufactured goods. It, too, is out-of-control, though in recent months it’s begun to show signs of stabilizing. Are trade policy changes enacted under Trump – the USMCA agreement with Mexico and Canada and the tariffs on Chinese imports – showing signs of having the desired effect of boosting domestic production? Or are we seeing signs that companies are awakening to the follies of the global supply chain? It’s too early to tell.

The global supply chain is in a state of “melt-down.” The crisis is more likely to get worse than improve. Thousands of businesses are responding by increasing orders in reaction to their empty shelves and are scrambling to find new suppliers. A few major retailers are bypassing the shipping companies by chartering their own ships. All of this will add to the chaos. However, perhaps the biggest factor working against regaining control of the supply chain is the fact that the main purpose of the global supply chain isn’t supplying us with goods at all. The real purpose of the global supply chain is to tilt the balance in favor of the “developing world” in the global war for employment. The economies of badly-overpopulated nations need to be propped up with manufacturing-for-export in order to employ their bloated labor forces and maintain political stability. As the supply chain chaos begins to unravel that grand plan, nations and global organizations like the UN, the IMF the World Bank and others will begin to react in ways that aren’t necessarily productive toward restoring stability to the supply chain. It’s impossible to predict the effect on such a complicated, out-of-control system.

As proof that powerful global forces are at work shoving the “global supply chain” model down our throats, consider this. We’re subjected to a daily drumbeat of warnings of an existential threat posed by carbon emissions. So dire is the threat that our energy industry must be converted to wind and solar and our auto industry must become all-electric, they say. Beyond that, elaborate plans are underway to “capture” CO2 from the atmosphere and from smoke stacks and to store it in underground caverns, in tanks, or anywhere they can hide it. Yet, you never hear anyone utter a single peep about the fact that the vast fleet of ships plying the oceans as part of the global supply chain consume five billion barrels of oil per year – not gallons – barrels. Those are emissions that could be completely eliminated by returning the world to a domestic supply chain.

Nor do you hear a single peep about the role of out-of-control population growth. No one bothers to even ask the question, “What will we gain if we reduce per capita oil consumption and carbon emissions by 50% if we double the population?” Globalists don’t want you to think that far. They deceive you into believing that the existential threat of climate change can be controlled by elaborate plans for reshaping our entire economy, and by throwing around oxymoronic terms like “sustainable development” so that you won’t begin to ask about simple, cheap fixes like returning to domestic supply chains and stabilizing the population. Those simple, cheap fixes would pose a threat to what they’re really concerned about – big profits available from developing third world countries and never-ending population growth. They think we’re all idiots.

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As an aside, I went to a home improvement big box store this week to purchase a shop light to replace one that I use throughout my basement and garage for lighting. To my dismay, I discovered that all such lighting has been converted to LED. You can still get flourescent bulbs for your existing light fixtures, but new flourescent fixtures are no longer available. This particular store used to stock at least 20 of these basic shop lights because, as you can imagine, there was a constant demand for them. But they didn’t have any of the basic 4-foot, two bulb shop lights available in the new LED design. I went home to search online for stores in the area might have them in stock. Not a single store in the whole metropolitan area had a single one in stock! Supposedly, I can get one within a couple of weeks if I order.

Doing some research into these new LED light fixtures, I made another interesting discovery. Every single LED light bulb, regardless of its configuration, uses a “chip” to make it work. Think about that. Just converting lighting to make it more efficient requires an additional billions of “chips” per year (which will add to our landfills), and now we can’t get enough chips to build cars. The entire world has gone mad.


Biden admin makes first acknowledgment of “Phase 1” deal as China’s compliance deteriorates further

October 12, 2021

In January, 2020, China signed an agreement with the U.S. – the “Phase 1” agreement – to boost its imports of American goods. They agreed to specific goals for four classes of goods – manufactured goods, energy products (like oil, gas and coal), agricultural goods and total goods. The agreement set specific goals for 2020, followed by higher goals for 2021. They also agreed that, if they failed to meet those goals, the U.S. would impose 25% tariffs on the remaining half of Chinese goods exported to the U.S. (The Trump administration had previously imposed a 25% tariff on all Chinese imports. The Chinese agreed to the Phase 1 deal in exchange for a delay of tariffs on the remainder of their products.)

Earlier this month, the Commerce Department released the trade data for the month of August. China’s imports of Amercan goods fell to their lowest level since February. Their imports of total goods dropped to $11.3 billion. By this time in the agreement, they should be importing $24.5 billion per month. Year-to-date, they’ve imported barely half of what they agreed to import. In fact, they’re barely exceeding the 2017 level that was used as the baseline for the agreement.

Their imports of manufactured goods have been flat at about 60% of what they agreed to import. Their worst performance has been their imports of energy products – only 20% of what they agreed to import in 2021. Surprising, given that China is currently in the midst of an energy shortage. Their imports of agricultural goods are less than half of what they promised – again, surprising given the challenges of feeding such a badly-overpopulated nation.

Through all of this, the Biden administration has remained silent, never once even acknowledging the existence of the Phase 1 deal, one of the signature accomplishments of the Trump administration. Until earlier this month, that is. Last week, U.S. Trade Representative Katherine Tai called out China’s failure to comply with the deal and said that Washington must enforce the deal. See this article: https://www.reuters.com/business/bidens-new-china-trade-plan-echoes-trumps-assumes-beijing-wont-change-2021-10-04/

The opening paragraph in the article reads:

“Top U.S. trade negotiator Katherine Tai on Monday pledged to exclude some Chinese imports from tariffs imposed by former President Donald Trump while pressing Beijing in “frank” talks over its failure to keep promises made in Trump’s trade deal and end harmful industrial policies.

Already I smell rat – the “free trade” rat that has infested Democratic and Republican administrations alike for decades and has absolutely ruined the manufacturing sector of America’s economy. Tai pledges to “exclude some Chinese imports from tariffs imposed by Trump” and wants to engage in “frank” talks. You’ve got to be kidding me. The Chinese themselves agreed to the deal. They agreed that they deserved to be punished with more tariffs if they didn’t comply. Instead, Tai wants to actually reward them by removing the tariffs already in place and then engage in mealy-mouthed talks – the same tactic that has left China rolling in the aisles with laughter each time such talks have ended, in disbelief at how stupid and weak American trade negotiators are.

This absolutely makes me sick. If you ask me, failure to enforce this trade deal should be an impeachable offense.


Existential Threats

September 21, 2021

“Existential threat.” It’s a term that gets thrown around a lot these days. What is an existential threat? It’s something that threatens your very existence. Someone who wants to murder you is an existential threat to you. You will stop at nothing to stop that person because your life depends on it. Another nation that wants to overthrow our own nation and make it their subject is an existential threat. Our nation’s continued survival depends on stopping that other nation, just as we had to do in World War II to stop Japan and Germany. Every citizen took part in mustering everything we had to fight them.

So, when you hear that term used today, you would expect an all-out effort to combat the threat. Consider China. Over the past 2-3 decades, China has used trade to its advantage to put it on a path to becoming the world’s most dominant economy, making us utterly dependent on them for virtually everything while draining the wealth from our own economy through their massive trade surplus. And, using those trade dollars, they’ve engaged in a massive military build-up and have begun bullying other nations in that part of the world. Belatedly, our own leaders now consider China to be the biggest existential threat that we may face in the world.

To counter that threat, Biden just cut a deal with Australia and Great Britain to provide Australia with eight new nuclear-powered submarines. That’s about $24 billion worth of naval power. If we’re willing to go to that extent, wouldn’t you think that we’d jump at the chance to put an end to China’s ambitions for a teeny, tiny fraction of that cost? Trump, Biden’s predecessor, left him with the perfect tool to do exactly that when he cornered them into agreeing to the “Phase 1” trade deal in January of 2020. Take major steps toward reducing their trade surplus with the U.S., or have a 25% tariff slapped on the remaining half of their exports to the U.S., just like Trump had already done to the other half. That was the deal.

China agreed to it but, not surprisingly, they never intended to comply, believing that we would never enforce it, just like we had demonstrated for decades that we never enforce any trade deals. A year and a half into that two year trade deal, China has reneged on every aspect of it. They agreed to very specific goals for imports of American agriculture products, energy products, manufactured products and total goods. Through July, the most recent month for which trade data has been released by the Commerce Department, China is $74 billion short of its goal for manufactured goods, $43 billion short of its goal for energy products, $25 billion short of its goal for agriculture products, and a whopping $134 billion short of its goal for total goods.

When Trump slapped the 25% tariffs on half of all Chinese imports (something Biden has wisely left in place), it put a real hurt on China. Their total exports to the U.S. have fallen by – guess how much? – 25%, falling $108 billion in 2020 from their record amount of $418 billion in 2018.

China has thumbed its nose at the U.S. on this deal. What has Biden done in response? Absolutely nothing. In fact, not one time has he ever even acknowledged that the Phase 1 deal even exists. I don’t get it. The U.S. is desperate to counter China’s growing influence, willing to spend many billions of dollars to do it, yet the Biden administration won’t take advantage of this powerful tool – the one China fears the most – and, in relative terms, it wouldn’t cost a damn dime to implement. Why? It’s difficult to come to any other conclusion than Biden doesn’t want to give any credit to Trump. We’re faced with an existential threat, and Biden won’t lift a finger for political reasons.

Another example is global warming. Just today, Biden addressed the UN and emphasized the need to take more drastic action to blunt this threat to the very existence of our planet. On Sunday, when questioned by Margaret Brennan on Face the Nation about his claim that the Democrats’ infrastructure bill should be $6 trillion instead of $3.5 trillion, Bernie Sanders replied by asking “How much would we be willing to spend to save the planet?” It’s a good question, actually. If the earth could become uninhabitable, then we should stop at nothing to prevent it, no matter how great or small the cost and no matter how complex or simple the solution.

Global warming (or climate change, if you prefer) is caused by human activity which generates greenhouse gases like CO2 and methane to name a couple, which trap heat in the atmosphere. It was never a problem until, during the last couple of centuries, the human population exploded, doubling over and over again while clearing forests to develop cities and fueling an improved standard of living with fossil fuels. Greenhouse gas emissions grew beyond the planet’s ability to absorb them. The problem is total emissions, which is the product of per capita emissions multiplied by the size of the human population.

But what if we didn’t have to spend trillions of dollars (maybe quadrillions?) to wean the world off of fossil fuels in favor of renewable sources like solar and wind? What if greenhouse gas emissions could be reduced for free? It can be done. It was demonstrated by the Covid pandemic when most people stayed home during the early weeks of the spread of the disease. Amazingly, the air cleared all over the world and the concentration of CO2 in the atmosphere dropped for the first time in many decades, something that all of the thousands of wind turbines and millions of solar panels had yet been able to achieve. When so many people hunkered down, it simulated what the world would be like with a smaller population.

It wouldn’t cost a thing and could be done more quickly than the decades-long or century-long timelines we’ve heard for cutting greenhouse gas emissions by X percent that scientists say needs to be achieved, though there’s little agreement on what “X” is. It can be done ethically, without resorting to Draconian measures. Birth rates can be influenced by something as simple as tax policy, and immigration can be cut. Reducing the population would not only solve global warming but virtually every other environmental threat along with it.

Yet no one utters a word to suggest reducing the population. In fact, the powers that be want it to continue to grow. The Paris Climate Accord pulls no punches in admitting that its real mission is not to stop global warming, but to reduce it to a manageable level so that “sustainable development” can continue. It’s not the planet they’re worried about. It’s “Sustainable development” – an oxymoron designed to fool you into believing that there really is such a thing – that you don’t need to worry about the environment because they’ve got everything under control.

In fact, the whole environmental movement has devolved into a scam meant to lull you into believing that everything is under control so that you won’t think about the situation so hard that you stumble upon the real problem – that it’s impossible to continue growing our population in a finite world. It’s a lesson that you learned as a child when you watched all the baby guppies die in your aquarium simply because there were too many for that little ecosystem to support. But that lesson has been tamped down by the purveyors of “sustainable development,” by the environmental proclamations of global corporations who are desperate to prop up growth in sales volume with population growth, and by politicians who tighten their grip on power by growing their electorate.

We are, in fact, facing existential threats, but the supporters of free trade and economic growth (code for population growth) would rather continue to profit from unsustainable policies in the short run, the future for our children be damned. They’d rather continue to trade with communist dictators today. Who cares if our children one day live under them? They’d rather have you believe that the recycle you put out on the curb for collection isn’t really going into a landfill, that your water-efficient appliance is actually saving you water, that your electric utility’s wind turbines and small solar panel farms are anything more than a drop in the bucket relative to the problem. Worst of all, the economists want you to believe that mankind is clever enough to overcome all obstacles to growth. I can think of two obstacles that we have yet to demonstrate we can overcome – stupidity and hubris.


United States the “World’s Breadbasket” No More

March 11, 2021

There was a time when the United States was known as the “World’s Breadbasket.” It’s “amber waves of grain” and “fruited plains” – noted in the first verse of “America the Beautiful” – supplied food wherever it was needed anywhere in the world. Even the Soviet Union turned to the U.S. for grain when its own harvests fell short of its needs.

Now, it seems that the “… pilgrim feet, whose stern, impassioned stress a thoroughfare for freedom beat across the wilderness” – from the 2nd verse of the same song, written originally in 1893 when the U.S. population was 65 million people – have grown the “alabaster cities” of the fourth verse to the point where we are the “World’s Breadbasket” no more. With a population of five times larger than when that song was written, we can’t even feed our own people any more.

At least that’s what our trade data tells us. Look at this chart. The category of foods, feeds and beverages – agricultural products – was once a bright spot in America’s ever-darkening trade picture. We always had a surplus for export to feed the world’s hungry, but no more. Our balance of trade in agriculture products has steadily eroded to the point where we’ve now run a deficit for the fourth year in a row. It improved a little in 2020 but, as you can see, it’s on a downward trajectory.

I have always steered clear of the subject of overpopulation in terms of resource shortages. Thomas Malthus hypothesized in 1798 that the world’s population would outstrip its ability to produce food. As decades wore on and the food supply grew even faster than the population, the other sciences mocked economists and proclaimed that mankind is clever enough to overcome all obstacles to further population growth. That has certainly proven true so far and may be true to a point, but any thinking person knows that there will eventually come a tipping point. In fact, it was only by ignoring the possibility of resource shortages and by pondering what else might happen as the population continues to grow that I was able to discover the inverse relationship between population density and per capita consumption – and its ramifications for worsening unemployment and poverty.

Nevertheless, I can’t help taking note of this trade data for agricultural products. Mind you, I’m no expert in the subject. One could argue that there are many other factors involved. Federal agriculture policy such as price supports, policies that encourage farmers to allow fields to lie fallow, etc. may all be playing a part here. Whether or not that explains the deficit in agriculture, I can’t say.

However, the data doesn’t lie. For the past four years, America is growing increasingly dependent on imports to feed its ever-growing population. That should be cause for concern for everyone. It’s bad enough that America is dependent on imports for virtually all things manufactured. That makes us weak and vulnerable. Being dependent on others for our food supply is far worse. Having enough to eat is a matter of total food production divided by the total population. Both factors need to be considered if we’re going to rectify this situation. It isn’t enough to simply consider how to boost production. (Do we really want more genetically-modified crops, more pesticides in our produce and more hormones in our meat?) It’s time to consider whether the number of “pilgrim feet” and whether the size of our “alabaster cities” has begun to overwhelm our “fruited plains.”

Immigrants, take note. Bring some grain and fruit with you, because we’re all out.


Biden “inherits” record trade deficit. Will he do anything about it?

February 8, 2021

The trade data released by the Commerce Department last week marked another sad milestone in America’s economic decline. The December balance of trade in manufactured goods set another new record -$87.3 billion – beating the previous record set only one month earlier. That’s an annualized deficit of $1.05 trillion and represents a loss of approximately fourteen million high-paying manufacturing jobs.

2020, the final year of Trump’s presidency, was by far the worst on record in terms of the trade deficit. In the title of this post, the word “inherits” is in quotation marks because while he now takes over that deficit from Trump, the truth is that Biden has played a key role in creating and exacerbating the deficit his entire adult life as a champion of globalist policies. He joined the U.S. senate in 1973. In 1975, America sadly experienced its final trade surplus, and has run an ever-growing deficit for the past forty-four years. He didn’t just “inherit” this problem. He played a key role in creating it, and it’s impossible to over-estimate the devastation done to our economy and to working Americans.

What will he do about it? Not a damn thing. His corporate benefactors, seeing more potential for profit growth in overseas markets than in the mature U.S. economy, have been paying him for decades to facilitate the transfer of America’s wealth and the export of American manufacturing jobs. He pays lip service to revitalizing American manufacturing, but that’s all it is.

Impeach Trump for inciting the Capitol building riot? Perhaps Biden should be impeached for his lifetime of work fomenting the unrest in this country that created the fertile ground for Trump’s rhetoric to take root.


Is the United States the stupidest nation on earth?

January 9, 2021

In light of the trade data released by the Commerce Department on Thursday, it’s difficult to draw any other conclusion. In November the trade deficit worsened to a new record of $64.5 billion. Actually, the situation is much worse than that. Strip away the surplus in services, which are little more than paperwork transactions, and you’re left with trade in manufactured goods, where real jobs are won and lost. Look at this chart. I would say that it couldn’t get any worse if it weren’t for the fact that with each passing month, it does. The deficit in manufactured goods hovered at the record level of $82.5 billion set only two months ago. That’s an annualized deficit of one trillion dollars.

Think about this. We’re paying the rest of the world a trillion dollars per year, putting their citizens to work making all the things we could just as easily make ourselves while, at the same time, we have tens of millions of people out of work. In fact, we’re paying trillions of dollars per year to pay our own people not to work. And we keep doing everything we can – as fast as we can – to make the situation worse. Ten years ago, in the wake of our most recent economic disaster, part of the auto industry bail-out was to allow Fiat to scoop up the Chrysler corporation, giving yet another foreign brand (the worst on earth, in terms of quality) an entry into the U.S. market, making the challenge for American cars that much worse. Building on that mistake, last month, FCA (Fiat-Chrysler of America) joined forces with PSA (the French automaker Peugot) forming a new company called “Stellantis,” giving Peugot access to the American market and, in all likelihood, finally killing the Chrysler brand.

Now we’ve elected as president a man who has spent his entire adult life championing policies that have exacerbated this decades-long downward spiral of our trade picture and, consequently, our entire economy. What little progress has been made under Trump he has vowed to rapidly undo.

If this situation doesn’t make the United States the stupidest nation on earth, I don’t know what would. And we wonder why this nation has become so divided and how there could be those among us so angry and frustrated that they’d be willing to riot and attack the capitol building. Trump was accused of lying to the American people about the election being stolen. I’ve consistently voted for candidates over these many years who have promised to do something about our trade deficit, and every one of them lied to us. Trump is accused of having blood on his hands for his role in fomenting the capitol building riot. For his part, Biden should accept blame for his role in formulating policies over the decades that have stoked the anger we saw unleashed on Thursday.

I remain angry and deeply disappointed with Trump for allowing his style and ego to get in the way of the bigger mission of Making America Great Again. The American people can forgive gaffes and rookie mistakes (being a rookie to the political scene), but they just couldn’t take any more of the daily barrage of personal insults that had nothing to do with the mission he was elected to do. It’s just sad to see it end this way.

It’s hard to see any hope of things improving for the United States. It angers me and makes me sick to say that. Since writing Five Short Blasts years ago, I’ve tried to keep this forum apolitical and focus instead on trying to explain the unseen economic consequences of population growth, including the danger of trying to engage in free trade with badly overpopulated nations. Maybe that’s been a mistake. So I’ll now say this: for decades Americans have been getting economically slaughtered like a flock of chickens. It’s hard to see any hope of things improving when you elect the fox to run the henhouse.