Thursday, September 20, 2018

Balancing Today and Tomorrow

Do you understand the underlying substance of debt and savings?

They both involve balancing today and tomorrow.

When you borrow you are allowing yourself to live better today at the expense of tomorrow. You are increasing gratification today that will need to be paid for tomorrow.

When you save you are delaying some gratification today to live better tomorrow. You will live better tomorrow at the expense of having a lower standard of living today.

Everyone has a choice. How do you want to live today? How do you want to live tomorrow?

There is no free lunch. There is a price to be paid... today or tomorrow.

It is hard to not want to live better today. After all, you can feel and enjoy the gratification here and now. The pain of payment seems like a long way off.

Most human beings are also optimistic. Even if they fully comprehend the trade off between today and tomorrow they figure they will be in a better position in the future to pay off their debts.

That works with a growing income that surpasses the cost of carrying the debt. However, if your income is only growing at 3% and the interest on your debt is 6% you will never get out from under it.

That is why living for today with credit card debt is so ruinous for so many. Even if your income is growing at 6%, credit card interest rates of 15% will bury you.

The same rules about debt apply to businesses and government. If you can't outgrow your debt obligations you are headed to a lower standard in the future. It is basic economics.

It is worthwhile considering the balance between today and tomorrow when we consider the the debt load in the United States.

There is now almost $4 trillion in consumer debt outstanding in the United States. This excludes mortgage debt.




$1.5 trillion of this amount is in the form of student loans!

$1.1 million in auto loans and leases.

$1.0 million in credit card debt.

This is all at a time when unemployment is at historic lows, wages have been increasing and the stock market has been strong.

What happens when incomes are not as good but that debt is still growing?

The same can be said for United States government debt. It is now over $21 trillion.




Who is this money owed to?

A lot is made in the media that we are dependent on China for much of this debt. This could not be further from the truth.

China only holds about 5% of U.S. debt. Japan holds another 5%. In all, about $6 trillion is held by foreign interests. That is less than 30% of the total.

The reality is that most of the debt is held by Americans. A great share of it is also held in retirement savings vehicles.

The Social Security Trust Fund ($2.8 trillion),  federal government employee pensions ($884 billion), military pensions ($742 billion), other federal government pensions ($415 billion), state and local pensions ($934 billion), private pension plans ($385 billion), US savings bonds ($160 billion).

If you are counting, that is $6.3 trillion. That does not count $1.8 trillion in mutual funds and $344 billion held by insurance companies of which a significant portion is probably held for retirement savings.

An additional $2.5 trillion is held by the Federal Reserve that relates to the debt monetization (money printing) that was done in the aftermath of the 2008 financial crisis.

In total, almost 70% of U.S. government debt is held by Americans. Only 30% is held by foreign interests.






I think the irony here is that $6.3 trillion has been put away in retirement savings accounts where individuals have accepted a lower standard of living today in order to have a richer life tomorrow. These funds are invested in U.S. Treasury bills, notes and bonds. However, those same funds have been used by the federal government to provide someone else a richer life today that will require higher costs tomorrow. It might be in the form of higher taxes, higher inflation or a lower standard of living on those same people. People who did the right thing (saved today) for a richer life tomorrow. It may not work out.

I have written before of how interconnected we all are financially. One person's wealth supports someone else's job. One person's savings supports another's ability to borrow. One person's default on a loan becomes someone else's loss on a note.

Our financial system operates largely on faith and confidence. As long a we have both, things are fine. However, when faith and confidence in the system (and in each other to meet our obligations) is lost, things can turn ugly very quickly.

That is why balancing everything, particularly today and tomorrow, is so important in our financial lives.

It is an important lesson to always keep in mind.

Tuesday, September 18, 2018

Free To Choose What She Wants To Do

Google and other technology companies have stated they are committed to more diversity in their engineering ranks. Most have major initiatives in place to hire more women in particular.

General Electric is another company that has made this a high profile issue. It has stated that its goal is to have 20,000 women in STEM roles and have 50:50 representation for all technical entry level jobs by 2020. This will require that 5,000 females be hired with STEM backgrounds in a just over a year.

Google has been publishing an annual diversity report since 2014 on their workforce composition in furtherance of its goal of hiring more females, blacks and latinos.

Here are the most recent numbers for tech hires in 2017 at Google.



Google does not separately break out its diversity percentages for the entire tech workforce. They only do this for new hires. Therefore, you can be sure that the overall numbers are much worse.

There was a lot of media attention last year when a Google employee claimed that the company was using a quota system in new hiring to increase its diversity numbers. The employee was fired after he wrote a memo stating that Google's liberal political bias led the company to believe that bias and oppression was the reason that minorities were underrepresented in the workforce. It therefore followed that quotas were necessary to correct the inequity.

The employee, James Damore, sealed his fate when he also questioned whether the distribution of preferences and abilities of men and women were partially due to biological causes and that these differences may partially explain why we don’t see equal representation of women in tech jobs and at Google.

That was a total career-ender.

I wrote a blog post at the time that addressed the neuroscience research that supported what Damore suggested could be a cause.

I also pointed out that it is hard to ignore the underlying numbers in all of this. Why is it that more American students do not major in the STEM disciplines? Why is it that women in particular do not select this course of study?

Why are 47% of Google tech hires Asian and only 24.5% female? Asians are in the STEM majors and women are not.

Why were only 2% of Google's tech hires Black and 3% Hispanic? The pool of qualified candidates is small. For further evidence look at this additional chart from the Google Diversity Report on attrition.





Why do many more Blacks and Hispanics leave Google than other races/ethnicities? Google says they are working hard to better understand it. Could it be a question of supply and demand? All of the tech companies want to increase their diversity numbers. There is a limited supply of qualified employees to recruit from. The offers to leave Google are simply more attractive to Blacks and Hispanics than for others.

Let's look at some broader numbers on this subject.

Only 1 in 6 American students are majoring in the STEM subjects. On the other hand, 1 in 3 foreign students in American universities are majoring in STEM.

Women only comprise 14% of engineering majors and 17% of computer science majors in our universities. What are they more likely to major in? Anthropology, Archaeology, Art History, Communications, Philosophy and Gender Studies.

Why is this? Is it a cultural bias? Is it because of gender inequality?

General Electric attributes the low numbers in part to a “vicious cycle of expectations and lack of role models.”

I am sure there is truth to that but is that the real reason?

I came across an interesting study that seems to show that it has nothing to do with gender equality.
In fact, the research indicates that in countries with the greatest gender equity you actually have the lowest percentage of female STEM graduates.

It seems that the greater the gender equity, and the higher the economic security for women, the more freedom females seem to believe they have the freedom to major in what they really want to do.






Don't expect to find many female STEM graduates in Finland, Norway, Netherlands or Belgium.

On the other hand, Algeria, Turkey, Tunisia and the United Arab Emirates you will find lots of them. All of these are Muslim countries.

If GE and Google are to reach their goals they may have to focus their recruiting in those countries. Of course, what then happens to the young men with those STEM degrees in the United States of America who do not get hired as a result?

Another chart I came across recently suggests that college students are no longer as interested in studying the Humanities as they were a decade ago. The combination of the high cost of student debt and the Great Recession must have caused many student to reassess their career interests.





Perhaps these students (which have historically had a higher percentage of female majors) have heard that Google and General Electric are good places to work and they they are not looking for Philosophy majors.

Anything that encourages more students (men or women) to consider STEM careers is a positive. I wrote about this need in the early days of my blog back in 2011.  However, we should not be sacrificing quality for quotas and we should not surrender to the nonsense that here are no innate differences between men and women to begin with.

Postscript:

Right after I finished this blog post I came across this article from The Times in London by Science Editor Tom Whipple who cites research that indicates there are greater differences in the sexes in societies that have more gender equality. In other words, the more gender equality, the greater the difference in the way men and women think.

This confirms the research in the study cited above on females in STEM degree programs by country.

For example, one study found that in China, which ranks low in gender parity, the personality overlap between men and women is 84%. In the Netherlands, which is considered at the top of gender equality, the overlap was only 61%.

"It seems that as gender equality increases, as countries become more progressive, men and women gravitate to towards traditional gender norms."
"There is too much evidence of this to be a fluke. It's not just personality. The same counter-intuitive pattern has been found in many other areas, including attachment styles, choice of academic specialty, choice of occupation, crying frequency, depression, happiness and interest in casual sex." 
"An explanation could be that those living in wealthier and more gender-equal societies had greater freedom to pursue their own interests and behave more individually, so magnifying natural differences."  

So much for feminist theory that argues that all differences between the sexes are due to cultural training and social roles. In fact, this research suggests that the differences become greater the more we treat them the same and they become more the same when we treat them differently.

Note to Google and GE. Perhaps the reason you have trouble in filling STEM positions with females is that a lot of them just are not that interested in the work...due to their own freedom of choice.


Sunday, September 16, 2018

Diversity Is Not Always A Strength

Diversity is a strength.

This a statement that we often hear.

We hear it cited by corporate human resources departments. University admissions officers. We even hear it from the U.S. Army.

This is a statement from Secretary of the Army Eric Fanning in 2016.

Over thirty years of scientific and organizational research clearly demonstrates that cognitively diverse teams are better at solving complex problems when compared to more homogenous teams, even when the homogenous teams are composed of top performing, highly capable individuals. We know some of this instinctively: different approaches often reveal overlooked solutions. Solving a problem often requires learning from others how to see it differently. 
Researchers at Cal-Tech and the University of Michigan found that teams that include members of different ethnic or cultural backgrounds bring a mix of distinct cognitive approaches, which deliver better outcomes. Business schools teach similar lessons based on their own research on gender. Their findings demonstrate that stronger more effective firms include greater numbers of women at top levels of management. Other studies have documented how teams of individuals drawn from diverse economic backgrounds, academic disciplines, and political affiliations are better problem solvers and drivers of innovation. 

There is no doubt that this true regarding diversity. However, it assumes that the organization shares common values, beliefs, goals and objectives. The Army insures that these elements are aligned through intensive training. There should be no confusion in the overall mission or the chain of command in the Army. The Army knows that if these are not present chaos ensues. 

If these foundational principles are not shared uniformly, diversity is a weakness, not a strength. In point of fact, diversity is a fatal weakness if the foundational principles are not aligned.

Consider marriage. Men and women separately have unique talents, perspectives and cognitive approaches. When combined, these add tremendous value to a marriage. However, if the man and woman do not share the same core values, beliefs and goals the other elements of diversity will wreak havoc to the union.

Over the last decade many countries in Europe have made arguments for diversity as they allowed hundreds of thousands of refugees to enter their countries. 

However, they have increasingly come to realize that the diversity they have introduced has put their society at increased risk. Most of the refugees are not aligned with the values and beliefs shared by the rest of the nation.

The prime example is in Denmark which has recently enacted so-called "Ghetto Laws" in order to integrate non-Western immigrants into Danish society.

Denmark refers to "ghettos" as areas with social problems where more than 50% of the residents are non-Western immigrants.

Prime Minister Lars Lokke Rasmussen had previously announced in his New Year speech that the government intended to take measures to “end the existence of ghettos” completely. That was followed by an announcement in March that the government would pursue a new set of laws to will “deal with parallel societies.”
While it’s not the first time the government has tried to abolish “ghettos,” the latest raft of laws mean the government will specifically target these areas—proactively enforcing rules aimed at integrating non-Western, predominantly Muslim immigrants into Danish society.
Many of the country’s 500,000 non-Western immigrants—largely from Turkey, Syria, Iraq, Lebanon, Pakistan and Somalia—live in these so-called ghettos. There, politicians say, “Danishness” is threatened by the prevalence of other languages and cultural traditions.

What are some of the new rules?

Children in ghetto areas must enroll in day care from the age of 1 in order to learn Danish values and the Danish language. Those classes must run at least 30 hours per week.

Parents who do not comply could have social service payments stopped.

An entire family can lose its home and housing allowance if anyone in the household commits a crime.

Crime such as theft and vandalism will be punished twice as harshly in "ghetto" areas as is the case generally.

Funds are available under the new law to actually fully demolish some ghetto areas. “For certain ghetto areas,” the plans say, “the challenges of parallel society, crime and insecurity are so massive that it is both practical and economical to [demolish] the ghetto area and start over again.” 

This should be useful perspective for those who keep shouting that diversity is a strength without understanding what it really means.

Denmark, and other European countries, have come to find out that you better have the foundational elements aligned before making that statement. It is also difficult to achieve integration and assimilation and the alignment in values and beliefs when there is mass immigration. 

I find it interesting that President Trump is called every evil name in the book for merely wanting our immigration laws enforced and that immigrants from terrorist nations be vetted more strongly.

At the same time, Denmark is enacting laws that would probably upset the sensibilities of the most ardent supporters of Trump's immigration policies.

The reality is that Denmark shows the reaction and results of what occurs when you believe you are reaching the tipping point as a country.

You have lost your country when you no longer have a border and you do not share a common language, culture and values. It ceases to exist.

The Danes have realized all of this late in the game. Do they want Denmark to continue to be Denmark? If so, they need to do something quickly or it will be lost. The same goes for most of the rest of Europe.

Those that cringe at Donald Trump and others who believe in the enforcement of our immigration laws should think longer term. These laws were put in place to insure that immigrants could be assimilated into our society and culture in a way that would not undermine our shared values and beliefs.

If you don't think this is an issue consider that there are more immigrants living in the United States today as a percent of the total population (13.7%) than at any point since 1910. Bear in mind this is just the percent who are actually foreign born. It does not include their children.

That is why the focus must not only be on illegal immigration but common sense reform of our current immigration laws as well.

If you don't think that the United States is taking in enough immigrants, you should consider this chart. It shows the total number of international migrants (foreign born) in each country in the world according to the United Nations.


Numbers of International Migrants-Top 20 Countries by Numbers
Credit: United Nations International Migration Report-2017


You do not have a country when you do not have core values and beliefs. Losing control now will necessarily result in much harsher measures down the road if you care about retaining those core principles. Look no further than Denmark. By the way, the number of immigrants in Denmark as a percent of its population is actually less than it is in the United States.

Denmark's problem, like most of Europe, is that they have allowed large numbers to immigrate from different cultures in a short period of time without considering the time needed to assimilate to their society.

Diversity is a strength. However, it invites chaos and catastrophe if you do not have a broad consensus about foundational principles. Diversity of opinion in values and beliefs ends in disaster for a country. It is a lesson to remember as we discuss our immigration policy.

Left unsaid is whether all of this has already played a major role in the political division in our country. Is it a mere coincidence that our political divide has gotten wider as the percent of immigrants has increased and the Democrat party has increasingly come to rely on immigrants for votes?

It was not that many years ago that almost every Democrat supported the building of some type of wall on the Southern border. Hillary Clinton, Barack Obama and Chuck Schumer all voted for the Secure Fence Act of 2006 which authorized 700 miles of fencing along the Mexican border. You can't be a Democrat today with that position. In fact, a great many Democrats now want to disband ICE.

It is wise to remember that diversity is not always a strength.

Wednesday, September 12, 2018

Things That Make Me Go Hmmm

I assess a great amount of information each week. I read and survey a number of general, economic and political news sites in addition to opinion and commentary materials.

Interesting items that I come across often turns into a blog post that I will share with you. That usually requires additional research on the subject to provide the necessary factual context of the issue at hand.

The items that catch my attention are the outlier facts that often go against the standard reporting or narrative of the day. What I am most interested in are the facts that point away from what you might have been told, or what you may think. to be true.

My biggest goal in writing BeeLine is putting things in context. As I often write in these pages, context is everything when assessing anything. In the news bite era we live in today, context is often no where to be found. I try to provide it when I write about a subject.

Coming into contact with so much material I often find I don't have the time to go deeper with a factoid I have discovered. Sometimes not much else needs to be said. The factoid itself says enough.

Here are a few such items that I have came across recently from Twitter sources I follow.

All I can say is that these are "Things That Make Me Go Hmmm".


  • Amazon just bought 20,000 delivery vans. That is 20% of the total number of trucks that UPS has. Wow! What does that means for revenues for UPS and the United States Postal Service going forward?



  • Has anyone ever done more damage to their brand in a few days than Nike did with its Colin Kaepernick ad campaign? 






  • San Francisco and Seattle (a city near you will undoubtedly be next) are banning plastic straws and bags and everything else plastic because of a plastic island in the South Pacific. Perhaps the focus is misplaced?



  • Percentage of out of wedlock births in England and Wales (1845-2017). You would think with the availability of contraceptives and abortion the opposite would have occurred. What happened? 



  • You might conclude from this graph that Americans have more money in their pockets. How did that happen? 



  • The last several years have seen rents and home prices increasing at rapid rates in many major cities. Rents across the United States have suddenly stabilized. Trouble ahead for the real estate market?




If you don't think student debt is a problem, think again. Student debt is now at over $1.5 trillion. More than credit cards or auto loans.




Anything above that makes you go Hmmmm?

Sunday, September 9, 2018

Mass Shootings: A Unique American Problem?

There was a mass shooting in my hometown of Cincinnati last week. Four were killed (including the shooter) and two more were seriously wounded.

Every time there is a mass shooting somewhere in the United States it is almost immediately followed by a politician or pundit on cable news stating that this does not happen in other countries. They claim the "gun culture" in America is responsible for these shootings that do not happen anywhere else in the world.

It was no different in the aftermath of the Cincinnati shooting. Mayor John Cranley of Cincinnati ( a Democrat) said this,




President of the United States Barack Obama said the same thing after several of the shootings during his tenure in office.

"At some point, we as a country will have to reckon with the fact that this type of mass violence does not happen in other advanced countries. It doesn’t happen in other places with this kind of frequency. And it is in our power to do something about it.” –Obama, statement on the shooting in Charleston, S.C., June 18, 2015

“We are the only advanced country on Earth that sees these kinds of mass shootings every few months.” Obama, statement on shootings at Umpqua Community College, Roseburg, Ore., Oct. 1, 2015

“But we are the only advanced country on Earth that sees this kind of mass violence erupt with this kind of frequency. It doesn’t happen in other advanced countries. It’s not even close. And as I’ve said before, somehow we’ve become numb to it and we start thinking that this is normal.” –President Obama, announcing his new executive orders on guns, January 7, 2016


What are the facts? Is it really true that this doesn't happen in other countries?

The Crime Prevention Research Center tracks the frequency and deaths from mass shootings worldwide.

The news we see in the United States rarely captures everything that is going on in the rest of the world. The CPRC tracks these mass shootings for the entire world using the FBI definition that at least four people were killed in the shooting (the Cincinnati shooting would meet this definition).

The reality is that there are actually fewer mass shootings in the United States than most other places in the world.

For example, look at France.

France suffered more casualties (murders and injuries) from mass public shootings in 2015 alone than the US has suffered during Obama’s entire presidency (532 in France vs. 527 in France).

Note that these numbers don’t adjust for the fact that the US has 5 times the population of France. The per capita rate of casualties in France is thus 8.19 per million and for the US it is 1.65 — France’s per capita rate of casualties is thus 4.97 times higher than the rate in the US.

The 2015 numbers for France are clearly skewed due to the coordinated ISIS November, 2015 terrorist attack at the Bataclan Theatre and the Charlie Hedbo attack in January of that year.

However, even if you look at the frequency of mass shootings per million of population, countries such as France, Switzerland, Austria, Norway and Belgium suffer more mass shootings than the USA does. This is despite all of these countries having stricter gun laws than the United States.

This is the data from the years 2009-2015 that Mayor Cranley and President Obama should have consulted before the statements they made about the United States of America.


Source: Crime Prevention Research Center


Source: Crime Prevention Research Center


In fact, CPRC research recently reported that since 1970 all but two of the 25 worst mass shootings in the world, and 60 of the top 68, occurred outside of the United States.

CPRC also found that just 1.43% of the global mass shootings, and 2.11% of the murders, from 1966 to 2012 were in the United States (1966-2012). The United States has 4.6% of the world's population.

Make no mistake. There is nothing that is more repugnant than mass murder. It doesn't matter how it is perpetrated. The very nature of the act demonstrates a wanton disregard for human life.

Mayor Cranley is correct in one regard. It is not normal.

Unfortunately, it is not just an American problem. I results from an abnormal human condition. Humans that have serious mental problems. If you look at the facts, it is not defined by national borders and does not disappear despite the best efforts to legislate it away.

We need to stop politicizing and start looking at dealing with the human problem that underlies these monstrous acts.


Thursday, September 6, 2018

Should They Be Kneeling?

Another NFL season is upon us and it seems that some players seem determined to kneel during the National Anthem. The NFL tried to craft a solution to the controversy that would have fined the team of any players who kneeled on the field (the team could then pass fine on to the player). Players who did not want to stand for the anthem could stay in the locker room. The NFL backed down when the player's union (NFLPA) complained. As a result, no official policy is in place as the season begin.

ESPN has stated it will simply not televise the National Anthem. It is unclear what the other networks will do.


Miami Dolphins in 2017
Credit: AP/Steven Brashear


The reason given by the players for kneeling during the National Anthem is that they are protesting racial inequality and police brutality in the United States.

Let's look at some facts behind this issue.

Last season 70% of the players in the NFL were African American.

However, African Americans only make up about 13% of the U.S. population.

Racial inequality?

African Americans make up 53% of the arrests for murder and non-negligent homicide in the United States.

African Americans make up 29% of the arrests for rape.

African Americans make up 55% of the arrests for robbery.

(All of these statistics from FBI Report: Crime in the U.S.-2016)

Racial inequality?

Consider further that those aged 15-34 make up the vast number of homicides regardless of race.

This graph shows the distribution of homicide offenders based on age across three historical periods.



Credit: https://www.sagepub.com/sites/default/files/upm-binaries/60294_Chapter_23.pdf


This indicates that over 80% of all homicide arrests currently are for those between the ages of 15-34. Note the disturbing trend of more homicides being committed by teenagers. In 1940, only 7% of homicides were committed by those between the ages of 15-19. Today it is close to 25%.

This also points to the fact that over 40% of all the homicides committed today are being committed by black males between the ages of 15-35. That group makes up just 2% of the total population of the United States.

In other words, young black males are committing upwards of 20 times the number of murders that would be expected relative to their representation in the population.

Racial Inequality?

It should also be kept in mind that most violent crimes (including murder) are committed against a member of the same race.

52% of all murder victims are African American. This is four times the number of murders that would be expected based on population.

58% of all male murder victims are African American.

32% all all female murder victims are African American.

33% of all murder victims are African American males between the ages of 17-34 who make up less than 2% of the total population.

(All of these statistics from FBI Expanded Homicide File Data Table 2-2015.)

Racial Inequality?

What about police brutality?

Yes, there are cases of police brutality. We have seen instances of it on videotape. However, these cases have to be put into the context of the thousands upon thousands of police interactions that occur in a typical day.

We hear about cases of white police officers killing an unarmed black man such as was the case in Ferguson, Missouri several years ago.

Yes, it does occur but it is about as common as being struck by lightning according to the statistics.

The National Review studied this issue last September in an article titled "Police Violence against Black Men Is Rare".

Last year, according to the Washington Post’s tally, just 16 unarmed black men, out of a population of more than 20 million, were killed by the police. The year before, the number was 36. These figures are likely close to the number of black men struck by lightning in a given year, considering that happens to about 300 Americans annually and black men are 7 percent of the population. And they include cases where the shooting was justified, even if the person killed was unarmed.

We also hear that African Americans are disproportionately stopped by the police for no reason. That same article cites the surprising fact that black men are actually less likely to have contact with the police in a given year than a white man.

 ...it’s not true that black men are constantly stopped by the police for no reason. Indeed, black men are less likely than white men to have contact with the police in any given year, though this includes situations where the respondent called the cops himself: 17.5 percent versus 20.7 percent. Similarly, a black man has on average only 0.32 contacts with the police in any given year, compared with 0.35 contacts for a white man. It’s true that black men are overrepresented among people who have many contacts with the police, but not by much. Only 1.5 percent of black men have more than three contacts with the police in any given year, whereas 1.2 percent of white men do.

Police Brutality?

I will leave it to you to decide the justification for protesting any of this given these facts.

However, no matter how you come down on this, what is the reason to do so by disrespecting the flag and the country that has provided those in the NFL with the opportunity and freedom to take the field and earn millions of dollars doing it?

Is there any consideration of the men and women who died under that flag to preserve that freedom?

Most particularly, what of the 360,000 Union soldiers who died in the Civil War to insure that freedom for those African American players?

Should they be kneeling?

Or should they proudly stand to honor the flag of the country and those that sacrificed their lives for that freedom?

Monday, September 3, 2018

Labor Day 2018

If there was ever a Labor Day to celebrate it is this one.

156 million Americans are employed. The most ever.

GDP grew at 4.2% last quarter.

The stock market is near all-time highs

The number of those working full time has increased by 5 million since January alone. This is almost unimaginable. Look at this chart that shows that full-time job growth since last July.


Monthly Number of Full-Time Employees in the U.S. (July 2017-July 2018)
(in millions, unadjusted)

Credit: Statista.com


The unemployment rate is 3.9%. We generally have not seen unemployment this low in half a
century.

Black unemployment is at all-time lows.

Hispanic unemployment is at all-time lows.

High school dropouts are even seeing all-time low unemployment lows.

327,000 new manufacturing jobs were added in the last year. That is the largest amount in 23 years.

There is also distinct difference in the jobs that are growing the most under Trump compared to what they were in the last year or so under Obama.

The chart below tells the tale. Mining, manufacturing and oil and gas extraction have all seen a resurgence under Trump.

Is that just luck? Or does a lot have to do with less regulation, tougher trade stances and low business taxes?

Obama supporters are trying to argue that all of this good economic news is due to the policies of the past eight years. Look at this chart and try to make that argument with a straight face.



Credit: Qz.com using BLS data


Remember when Barack Obama told workers in many of these industries that these jobs were never coming back?

The Obama administration also consistently argued that sustained economic growth beyond 3% was a thing of the past. We were told that our expectations had to be lowered to a new reality. Perhaps that was because there was not one year in Obama's eight years that GDP grew at least 3%.

On this Labor Day let's consider our blessings that so many in the United States are productive, working members of society.

Make no mistake. The cycles of economic activity are still with us. These good times will surely be followed by some tough times. Donald Trump cannot reverse the cyclical nature of man and his universe. No man can. However, all of this should show that the right policies and incentives do make a difference.

Thank you, one and all, for your labor. Enjoy your day.

Thursday, August 30, 2018

One For The Ages

Mrs. BeeLine and I recently watched the classic film, The Philadelphia Story.





The movie was released in 1941 and starred Katharine Hepburn, Cary Grant and Jimmy Stewart. This is how Google describes the film.

This classic romantic comedy focuses on Tracy Lord (Katharine Hepburn), a Philadelphia socialite who has split from her husband, C.K. Dexter Haven (Cary Grant), due both to his drinking and to her overly demanding nature. As Tracy prepares to wed the wealthy George Kittredge (John Howard), she crosses paths with both Dexter and prying reporter Macaulay Connor (James Stewart). Unclear about her feelings for all three men, Tracy must decide whom she truly loves.

The movie was based on a popular Broadway play that Hepburn had starred in. At the time, Hepburn's Hollywood career was in tatters. She had had several film flops and was considered "box office poison" at the time by a a number of theatre owners. In order to reinvigorate her career she purchased the film rights to the play and agreed to perform for no salary taking a percentage of the gross as her compensation.

It proved to be a good decision for Hepburn as The Philadelphia Story turned out to be the 5th highest grossing film of 1941 with a global box office of $3.3 million. In today's dollars that would be about $60 million.

In addition, Jimmy Stewart won the Academy Award for the best actor for his role in the movie.

Two things always strike me when I watch an old film.

1. How thin the people are.

2. How mature they seem to look compared to their actual age.

The Philadelphia Story is no exception. Hepburn looked to have a waist no bigger than a 12 year old girl would today. I found this site that suggests it was 22 inches. That is a on a height of 5ft 7.5 in.




Of course, that is gigantic compared to the rumored 20 inch waist that Vivien Leigh had in Gone With The Wind in which she played Scarlett who had a 17 inch waist in the book. Leigh reportedly was squeezed into a 16 inch corset during filming. I am sure that made for some long days on the set.

You get an idea of how small waisted Leigh was by looking at the picture of Leigh and Clark Gable from the film. Notice the size of Gable's hands in relation to Leigh's waist. Gable was about 6' tall according to most reports.




I think we understand why everyone was much thinner in those days.

What about their ages?

The actor that got me thinking about this in The Philadelphia Story was Katharine Hepburn's fiancee played by an actor named John Howard. When he was first introduced in the film I thought he was much older than Hepburn.

How old does he look to you? Howard is the man on the far right. In the movie, it is stated he is 32 years old. Stewart's character is 30 and I did not pick up any ages for the characters that Hepburn and Grant played.




Howard's actual age when he made the movie was 27. To me, in the movie he looked to be much older than Hepburn. He looked to be at least 40 to me.

Stewart was 32 when he made the film.

Hepburn was 33.

Grant was 36.

By the way, Clark Gable was only 38 when he filmed Gone With The Wind.

Perhaps all of this is just me showing my age since these actors are generally younger when they did these parts than the age of my kids today.

However, I think it is more than that.

The generation in those old movies grew up in tough times. They were children during World War I and they also all lived and had to survive the Great Depression. It made you grow up quicker and it also undoubtedly made you look and act more mature.

I made the same point several years ago when I compared the lives of Barack Obama and U.S. Grant.

Most people are shocked to discover that U.S. Grant became President at a younger age than Barack Obama. Grant was also younger when he took office than Paul Ryan is today.


U.S. Grant, March,1869
46 years old



Barack Obama, Janaury, 2009
47 years old



Paul Ryan, June, 2018
48 years old


That is pretty incredible when you think about it. One of the reasons that Grant seems like he was so much older is that he had effectively lived four lifetimes before he ever became President. Grant had literally seen it all in both his personal experiences and in the decisions he had to make as a leader.

Comparing the life experiences of a Paul Ryan or Obama to Grant would be like comparing a 6-year playing T-Ball to Mike Trout.

It seems that in this day and age life experience is heavily discounted compared to educational background and political experience. I think that is a big reason why the Deep State and the Mainstream Media despises and underestimates Donald Trump so much. How can Trump know anything? He doesn't have a law degree from Harvard, a Master in Foreign Relations from Georgetown and he hasn't lived in Washington for 20 years.

However, stop a minute and consider how much life experience Donald Trump had before he became President. Thousands of hours interacting with all sorts of people in his real estate business---union leaders. politicians, lawyers, contractors, construction workers. Nearly 50 years of interfacing with the media. More than a decade headlining a top-rated television show. Being on the A-list and being invited and interacting with almost every celebrity you could imagine for at least 30 years.

It all adds up and it compounds into providing Trump with perspectives in understanding and analyzing people and situations in ways that those with less life experience simply cannot fathom.

Trump has a lot of flaws. He is not immune from foibles. However, too many discount the life experience he has that is almost unparalleled by any other human alive today. He has seen a lot and done a lot. He has packed a lot into 72 years and he seems to have the energy of someone half his age. Some might think he does not act his age but you are making a mistake if you ignore the life experience that he has attained over the years.

Who would think that I would be able to write a blog post from watching an old movie on TCM? That ability also comes from life experience.

It is surely one for the ages.


Tuesday, August 28, 2018

Did a Tycoon Become a Tyrant?

It is difficult to keep up with how the Left describes Donald Trump.

He used to be a successful tycoon that contributed to many of their campaigns.

That changed when he announced he was running for the GOP nomination for President.

He was first described as a joke. He was then called a buffoon. He then became an idiot.

That was before he was elected President of the United States.

Since he was elected President he has been called a racist, a fascist and a danger to the entire world.

He has been described as unhinged and detached from reality many times as well.

That has evolved to Trump now being called a thug, a treasonous criminal and, most recently, a tyrant.

The tyrant description is contained in an article in The Atlantic by Eliot Cohen which has this title and subheader.




That was a new one for me. Trump is a tyrant? Really?

Let's look at the definition of a tyrant and see if that in any way fits Donald Trump.


Source: Merriam-Webster.com

Let's look at the facts.

In what ways has Donald Trump been acting unrestrained by the the law or the constitution?

When has he been oppressive or brutal? Let's be serious. Calling someone a name on Twitter doesn't count when we are talking tyrant.

When has he been a usurper of sovereignty?

Those on the Left would say to look at the various executive orders that Trump has implemented.

However, the fact is that most of those executive actions were merely reversing executive orders that were initiated by Barack Obama. These were actually returning us to the rule of law set forth based on the Constitution before Obama became President.

The Left would undoubtedly also point to some of President Trump's actions on immigration. However, the fact is that there are, and have been, laws on the books about immigration for decades that have not been enforced. Trump's actions have been consistent with enforcing the rule of law rather than circumventing the law.

There is no law on the books to allow Dreamers to stay in the country. Obama signed an executive order to do that. You could say he was unrestrained by the law in doing so.

Trump even challenged Congress several times to change the immigration law (including providing a legal path for Dreamers to citizenship) to update the law to current circumstances. Nothing happened.

Democrats argue that they would not agree to the deal because Trump wants to build a law (in order to enforce the law) and he will not agree to amnesty (for those who broke the law).

Who exactly is unrestrained by the law?

Trump's executive order banning immigration from countries with terrorist ties was immediately challenged in court and he deferred to the rule of law as the case was appealed. The Supreme Court ultimately approved his executive authority to institute a ban in accordance with his legal authority.

A tyrant? I don't see any evidence whatsoever to make that claim against Trump.

If we want to look a President who was unrestrained by the law look no further than Barack Obama.

Here is short list of some things you might have missed or forgotten about during the Obama administration. Credit to Thomas Wictor for this list.

(1) In the GM bailout, Obama illegally ordered the bankruptcy court to ignore shareholders and non-union members in order to restore union members.

Shareholders lost 100 percent of their investments.

(2) In Operation Fast and Furious, the Obama ATF allowed straw buyers to arm the Mexican drug cartels.

Hundreds of Mexican police and citizens were murdered as a result.

(3) Instead of deporting illegals, the Obama US Customs and Border Protection took them to bus stations in McAllen, Texas, bought them tickets, gave them payment vouchers, and turned them loose.

(4) The Obama Department of Justice used Operation Choke Point to illegally pressure banks to not do business with gun dealers.

(5) In order to implement gun-control measures, Obama illegally bypassed Congress using Executive Orders.

Trump rescinded the Executive Orders, thus reducing the power of the Executive Branch and returning to Congress, where it belongs.

(6) Obama illegally implemented the Deferred Action for Childhood Arrivals (DACA), which is not any form of government rule.

He simply ordered that his administration carry out his wishes.

(7) Obama illegally ordered the Labor Department to delay the caps on our-of-pocket expenditures under ObamaCare.

The law was changed without legislation. Obama simply ordered it done.

(8) Obama illegally delayed the employer mandate of ObamaCare.

Again, that was done without legislation. Obama simply ordered it to happen.

(9) Obama illegally ordered the Office of Personnel Management to exempt Congress and their staff from the requirement that they get their coverage through ObamaCare exchanges.

(10) Obama illegally delayed the requirement that the public buy ObamaCare-compliant plans, and THEN he rejected House legislation that would have made his actions legal.

(11) Obama illegally ordered the IRS to ignore the requirement that tax credits be offered only for use of state exchanges. Instead, the IRS was ordered to offer tax credits for state, regional, subsidiary, and federal exchanges.

(12) Obama illegally ordered the IRS to profile political organizations. Formal guidelines were issued to "be on the lookout" for groups that had specific words in their titles or descriptions.

(13) The Supreme Court ruled against the Obama administration more than any administration in history.

In each case, the government's only argument was that federal power has no limitations.

(14) Obama illegally made recess appointments when Congress was still in session.

(15) Obama's Department of Education’s Office of Civil Rights and Justice Department illegally sent out guidelines to speech on college campuses. The procedure denied legal representation, encouraged punishment before trial, and used a “more likely than not” conviction standard.

(16) Obama illegally ordered the Department of Homeland Security to issue work and residence permits to the so-called Dreamers.

(17) Obama's Justice Department illegally obtained recorded conversations from employees of the Associated Press.

(18) Obama illegally ordered the Boeing company to close a non-union plant in South Carolina.

(19) Obama fired Gerald Walpin-- Inspector General of the Corporation for National and Community Service--after Walpin reported that Obama friend Sacramento mayor Kevin Johnson used AmeriCorps funding to pay for political activities.

(20) Obama illegally met in secret with lobbyists hundreds of times, violating disclosure laws.

(21) Obama raided the guitar factory of a REPUBLICAN manufacturer for allegedly using illegal
wood, while the DEMOCRATIC manufacturer was allowed to continue using the same wood.

(22) Obama illegally appointed "czars," thus bypassing the requirement that Congress approve appointees.

(23) Obama illegally demanded payment for Freedom of Information Act (FOIA) requests.

(24) Obama illegally directed most of the "Stimulus" to union pension funds.

(25) Obama illegally exempted unions from most ObamaCare requirements.

(26) Obama lied about the Benghazi attack, claiming that it was caused by a movie trailer, when in fact it was a carefully planned al-Qaeda attack that involved over 150 men armed with gun trucks, mortars, and rocket-propelled grenades.

Of course, none of this even touches on the extent to which the Obama administration might have been complicit in covering up crimes of Hillary Clinton. It also does not consider the extent to which the Obama DOJ, FBI, CIA and others may have conspired to prevent (or remove) Donald Trump from the Presidency. That is still to be determined but it looks dangerously close to an abuse of power at a minimum.

I had many major philosophical and policy differences with Barack Obama when he was President. I wrote about them often in these pages. However, not once did I call him a tyrant, a thug or treasonous.

It is difficult to understand where the Left is coming from. In point of fact, Donald Trump is doing exactly what he said he would do as President. There was no curve ball. There was no bait and switch. 62 million Americans and, most importantly based on the rule of law and our constitution, 304 electoral votes (compared to 227 for Hillary Clinton) were cast for Trump.

Voters evaluated the candidates more thoroughly (though tv, radio, debates, social media) and extensively than any two Presidential candidates in history. By far! However, the Democrats just can't seem to accept that they lost.

Democrats and the media also seem to be confounded that Trump's approval ratings do not appear to slip no matter how much mud, muck and mendacity they try to spread to the voters.

Trump is not immune from losing the loyalty and faith of his voters. It could happen. It can happen to any politician given the right circumstances. However, I have seen nothing to this point that is a surprise compared to what I thought Trump was when I voted for him.

In fact, most Trump voters I have spoken with believe he has exceeded expectations to this point. Count me in that group. A number of those voters were reluctant Trump voters who were more motivated to vote against Hillary than for Trump. That is no longer the case. Trump has earned their respect and support in his own right based on his results as President.

Did the real estate tycoon become a tyrant as President?

You can decide. The voters always decide in our system. Or they are supposed to.

That is the only reason I can think of that the Democrats are so desperate right now. They are close to panic that the voters have not bought what they are selling. They keep ratcheting up the attacks and it seems to have no effect.

I wrote shortly after Trump was elected that the Democrats would make a lot of noise about the dangers of a Trump presidency and the dangers we would face as a country with him in office.

However, I pointed out that Democrats were not really worried about Trump failing. They were really worried that he would succeed.

SUCCESS.

That is how a tycoon becomes a tyrant.

Sunday, August 26, 2018

The Perils of Parenting

It is incredibly difficult to a be a parent in this day and age.

There are so many things out there to distract your child and put them on the wrong path. 

It is not easy instilling the right morals, character and values in your child to confront today's society. You would hope that their school would be an ally in that quest. 

A couple of examples from the headlines this week shows how diligent parents must be in monitoring what is going on at their children's schools.

A 10-year old boy in Tarboro, NC was punished for calling his teacher "ma-am."

The mother of a 10-year-old boy in North Carolina is outraged that her son was recently punished for calling his fifth grade teacher "ma’am.”
“I was in disbelief,” Teretha Wilson, the boy’s mother, told Fox News on Saturday.
Wilson noticed her son, Tamarion, was not himself when she picked him up from the bus stop earlier this week.
“I asked him what was wrong, and he told me he got in trouble for saying 'ma’am' to a teacher. I was confused,” she said.
The next afternoon, Wilson went to the school to meet with Tamarion’s teacher and the school's principal. With her she brought a separate piece of paper on which her son had written the definition of ma’am. (According to the Oxford Dictionaries, ma’am is defined as “a term of respectful or polite address used for a woman”).
Wilson claims Tamarion’s teacher told her that her son “was getting on her nerve when he called her ma’am" but “couldn’t give me a reason of why that was bad.” The teacher also claimed Tamarion knew that she wasn’t serious when she allegedly threatened to throw something at him, Wilson said.

So much for Southern manners.

It appears that patriotism and allegiance to the flag is also threatened in the South. And here I thought it was just with NFL players.

An Atlanta neighborhood charter school principal announced at the beginning of the school year that students would no longer recite the Pledge of Allegiance. She explained it to parents as “an effort to begin our day as a fully inclusive and connected community.”

That's weird. I thought that was exactly what reciting the Pledge of Allegiance was supposed to do. Doesn't the pledge explicitly state that we are all connected together by our country and God and we cannot be divided? Doesn't it state we all pledge allegiance the principles of liberty and justice for all?  How much more inclusive and connected  can you get?

"I pledge allegiance to the Flag of the United States of America, and to the Republic for which it stands, one Nation under God, indivisible, with liberty and justice for all."

“Over the past couple of years it has become increasingly obvious that more and more of our community were choosing to not stand and/or recite the pledge,” she wrote, according to the Atlanta Journal Constitution.
“Teachers and the K-5 leadership team will be working with students to create a school pledge that we can say together at morning meeting,” Zelski wrote, adding that it “will focus on students’ civic responsibility to their school family, community, country and our global society.”

I pledge "civic responsibility" to our global society? Notice that the principal also does not suggest the focus be on allegiance to our  country. The "civic responsibility" should be to their country. What country is that if not the United States where they are going to school compliments of the taxpayers?

Fortunately, parents of students at the school were infuriated, and as the decision got media coverage and the attention of state politicians, the principal quickly reversed the course.

Therein lies a lesson for parents according to Janice Shaw Crouse, the author of the book, "Children at Risk".

“I think parents should take heart … in that the administration was forced to change their minds and go back to having the Pledge of Allegiance,” she said. “And I think parents can learn from this that they do need to speak out, and they do need to know what’s going on so that they can speak out.”

To make matters worse, last week brought news of a Pennsylvania grand jury report that alleges child sexual abuse involving more than 300 "predator priests" in six dioceses in the state. Many of the priests were well known to the Catholic Church hierarchy but were actively involved in covering up the abuse.

This is just another in a long string of such cases that we have heard about in recent years. It has been reported that the Catholic Church in the United States has paid out $3.8 billion in lawsuits and claims since the 1980's involving sexual abuse.

There is even a credible report out today from Archbishop Carlo Maria Vigano (the Vatican's former ambassador to Washington, D.C.) that Pope Francis himself has been complicit in looking the other way regarding at least one Cardinal that was found to have engaged in child abuse. Vigano has asked for the Pope to resign.

This has reached the point that it seems that the Catholic Church has serious fundamental problems within the culture of its clergy. It also raises serious questions about the entire leadership of the church. Vigano calls it an "infected swamp". Does that sound familiar?

It would appear that the only solution is fundamental change and that probably will only occur if loyal Catholic parishioners demand that change.

In the meantime, parenting is perilous. The institutions that we have traditionally relied on to help guide our children's morals, character and values are unreliable.

We were told by Hillary Clinton that it takes a village to raise a child. Unfortunately, it appears we can't trust the village to help.

Thursday, August 23, 2018

The Bartender and the Bus Driver





One of the great mysteries of my life is how there can still be people promoting socialist political ideology. It is something that I have heard for nearly seven decades.

You would think the evidence of those last seven decades would have disheartened even the most passionate devotee that believes that socialism benefits humanity.

Let's look at a few examples.

I am using some of the extreme examples of communism compared to capitalism. American socialists today argue that communism is not their ultimate goal. They do not desire to take over all private property and production. They just want to take what is needed to be "fair" to everyone. Of course, Marxist theory (see above) makes clear that socialism is considered just a transitional state toward the realization of communism.

Of course, there is never enough to go around. Therefore, this inevitably requires more and more control by the government of the private sector. Look no further than what has happened in Venezuela.

Korea was cut into two halves after the Korean War. The North adopted socialist political and economic theory. The South was committed to capitalism and freedom.

Same people. Same cultural background. Very different results.

There is no better way to view the stark difference than this satellite image taken by NASA in 2014. That dark area between South Korea and China is North Korea at night.


PHOTOGRAPH BY EARTH SCIENCE & REMOTE SENSING UNITY, NASA JOHNSON SPACE CENTER
The difference? Communism vs. Capitalism.

Looking at it in graphic terms comparing Gross Domestic Product it looks like this.

Credit: Edward C. Prescott, Barcelona Graduate School of Economics

A similar situation occurred in West Germany and East Germany when Germany was divided after World War II. Same people. Same culture. The West and East both had GDP per capita numbers that were identical in 1949. By 1990 (at the time of reunification), the capitalist West had GDP per capita that was almost double that of the East.

The difference? Communism vs. Capitalism.

It is no different between Communist China and Taiwan (The Republic of China).




China has made enormous strides since it moved away from its "planned socialist economic" system and moved to what it now calls its "socialist market economic" system that introduced privatization and contacting out much of state-owned industry in the late 1980's and early 1990's. Is it a coincidence that China's economy took off right after they moved from a strict communist system to a more open, market based system?

There is no better way to show this than in this chart of averages wages in China which have exploded upwards since those market reforms were instituted.







Another way to look at it is to consider the fact that in 1990 756 million Chinese lived in extreme poverty. By 2013 that number was 25 million.

By the way, Taiwan has 23 million people in a country of 13,973 square miles. China has a population of 1.3 billion with 3,705,407 square miles. Despite all the advantages of geographic size, natural resources and the population that China has, Taiwan's GDP per capita is 3 times larger today even after China's huge step forward with its economic reforms over the last 30 years. That is a lot of additional wealth. That is the difference between capitalism and communism.

Of course, we do not have to look any further than Venezuela to see what socialism has done to what was once the most prosperous country in South America in the space of less than two decades.

Bear in mind that all of this is occurring in a country that is reputed to have the largest oil reserves in the world. Despite that, food is so scarce that last year the average citizen is reported to have lost 19 pounds. Millions have fled the country's shortages and poverty.

Last week Venezuela President Nicolas Maduro announced a new single exchange rate for a new Venezuelan currency that would effectively devalue the currency by 96 percent.

In one of the biggest economic overhauls of Maduro's five-year government, the former bus driver and union leader also said he would hike the minimum wage by over 3,000 percent, boost the corporate tax rate, and increase highly-subsidized gas prices in coming weeks.
"I want the country to recover and I have the formula. Trust me," Maduro said in a nighttime speech broadcast on state television.

Of course, that 3,000% increase in the minimum wage will not help those workers very much. Economists predict that the inflation rate in Venezuela this year will hit 1,000,000%!

Maduro has the formula and he wants those that are left in Venezuela to trust him?

It sounds a lot like new Democrat darling Alexandra Ocasio-Cortez doesn't it?  She also says she has the formula and to trust her.

Did you know that Maduro was a bus driver before he got into politics?

Did you know that Ocasio-Cortez was a bartender?

Socialism and communism inevitably results in a lower standard of living and hardships for the masses. It has been documented time and again throughout history.

The irony is that it is always sold as being a better system for the masses. It is promoted as "the way" to remove class distinctions, unfairness and insure equitable wealth distribution in a society.

You have to remember that the economic system of governance makes little difference to the leaders of countries.

After all, they lead a life of privilege no matter what economic system is in place. That is even truer in communist or socialist countries because the political leaders become the aristocracy. Everyone is beholden to the government.

That is why we keep hearing about the ideal of socialism. It is because there will always be a bartender, bus driver, baker or barrister who figures out that their career prospects are better as a politician selling this baloney. Why work and pay taxes when you can get on a podium, promise people the world, take other people's money and spread it around as you see fit? And keep a pretty nice share for yourself.

That is pretty much the history of socialism and communism.

That is also why, even though history is replete with the failures of socialism, we will continue to have bartenders and bus drivers who say "trust me, I have the formula."

There will also be new generations who are ignorant of history and actually believe these people have a formula that actually works.

Trust me.

It never has and it never will as long as humans inhabit the earth.