Trump Appoval---It Depends On Who You Ask

To hear mainstream media reporting you would believe that President Trump's approval rating has completely tanked. 

It is true that Trump's approval rating has come down from where it was in the first couple months of his second term in the RealClearPolitics.com composite average.

His net approval is now -5.2 in the RCP average.

This takes into account polls that show Trump's net approval ranging from +10 ( Insider Advantage) to -18 (Quinnipiac).

For context, Insider Advantage was considered the #2 ranked pollster in 2024. Quinnipiac was #36 according to ActiVote.net.

Source: https://www.realclearpolling.com/polls/approval/donald-trump/approval-rating
as of 8/28/25

 

In Trump's first term he was -18 at this same point.

Trump's net approval is actually better than Barack Obama's was at the same time in his second term (-6.7%).

Almost of Trump's erosion in net approval rating appears to be coming from Independents.

For example, 93% of Republican voters approve of Trump compared to just 5% who disapprove in a recent Gallup poll.. That is a net approval of +88.

In June, Trump was  +78 with Republicans.

Trump's net approval is actually higher with Republican voters now than right after he was inaugurated according to Gallup.

On the other hand, Trump is -24 with Independents in the Gallup polling and -96 with Democrats.

Source: https://news.gallup.com/poll/203198/presidential-approval-ratings-donald-trump.aspx

Republicans see Trump as doing exactly what he said he would do when he campaigned.

Many Independents and almost all Democrats seem to be surprised that Trump is doing exactly what he said he would do during the campaign.

They are used to Presidents moderating or ignoring campaign promises. They were hoping for a Trump that was closer to a mushy middle roader. They are finding out once and for all that is not in Trump's DNA. 

What is most telling in the polling is when you ask voters to make straight one on one comparisons.

Trump vs. Kamala. 

Trump is +6.

Bear in mind that Trump only beat Harris by 1.5 percentage points last November.

Trump seems to be more popular today with voters than he was when he was elected.

Trump vs. Biden.

Trump +8.

The media narrative is simply not supported by the numbers.

Trump has never been more popular with Republican voters.

He is as unpopular as ever with Democrat voters.

Independents seem to be coming to grips with the fact that Trump is governing exactly like he said he would.

Trump's approval really depends on who you ask.

However, when compared to the Democrat alternatives, Trump appears to be stronger than he has ever been with American voters.

Disability Perplexity

What has caused the number of people who are disabled to skyrocket since 2020?

7 million additional people in the United States have been classified as disabled over the last five years.

Source: https://fred.stlouisfed.org/series/LNU00074597

Below is a chart showing the population with a disability 16 years of age and older over the last year.

An astounding 1.1 million additional people have been added to the numbers of the disabled in the last three months!

The numbers have increased 2.4 million over the last 12 months.

Source: https://fred.stlouisfed.org/series/LNU00074597

What is going on?

What are the criteria to be considered to have a disability in the numbers above?

There are six disability types according to the Census Bureau standards that are used in compiling this data.

1. Hearing difficulty  deaf or having serious difficulty hearing 

2. Vision difficulty  blind or having serious difficulty seeing, even when wearing glasses 

3. Cognitive difficulty  Because of a physical, mental, or emotional problem, having difficulty remembering, concentrating, or making decisions .

4. Ambulatory difficulty  Having serious difficulty walking or climbing stairs 

5. Self-care difficulty  Having difficulty bathing or dressing 

6. Independent living difficulty  Because of a physical, mental, or emotional problem, having difficulty doing errands alone such as visiting a doctor’s office or shopping 

The most obvious answer is that the increased numbers of those with a disability is due to an aging population.

This clearly explains some of the increase.

However, note that the disability numbers were relatively flat in the previous five years (2015-2020) when the leading wave of Baby Boomers were already beginning to reach their 70's.

Source: https://fred.stlouisfed.org/series/LNU00074597

Is something else involved here?

Could any of this be due to effects from Covid?

That certainly could be the case.

However, the numbers actually dropped at the beginning of Covid and did not begin to rise dramatically until the period between March and June, 2021 a year into Covid.

Source: https://fred.stlouisfed.org/series/LNU00074597

Is it a coincidence that the March-June, 2021 period is also when Covid vaccines were being rolled out most aggressively?

Credit: https://ourworldindata.org/grapher/us-daily-covid-vaccine-doses-administered?country=~USA

The numbers since that time have moved upwards on a less aggressive but still very consistent path.

You will almost never see the possibility that the Covid vaccines could be involved from anyone who is studying the increases in disabilities.

Why is that?  

I think we know why. 

An honest analysis should raise the question of whether the Covid vaccines are responsible for the increased numbers in some form or manner.

Is it possible that Covid or the Covid vaccines might have accelerated disability conditions in an already aging population?

My guess is that an aging population, Covid and the vaccines could very likely all be involved in some way in the increased numbers we are seeing with disabilities.

Based on the data, my view is that the most likely reason for the increase in disabilities is that Covid and/or the vaccines accelerated and exacerbated conditions that our population were already vulnerable to as they aged.

Whatever the reason for the rise in disability numbers, the important point here is that anyone with a disability is dependent on the rest of society for the care and support they need.

Increased numbers with disabilities increases the pressure on the Social Security disability income trust, on Medicaid and Medicare and disability insurance rates with private insurers.

It puts additional financial pressure on families who might have to pay for senior or other institutional living support.

It puts additional pressure on the entire economy as there are fewer people that are able to work and more people who need help.

Few people are talking about the increases in the numbers of those with disabilities that I reference above.

They should be.

Even those who are experts in this area in the insurance industry are "puzzled" about the rise in disability claims as this headline from January in InsuranceNewsNet indicates.

Source: https://www.census.gov/topics/health/disability/guidance/data-collection-acs.html

Along with a baffling rise in post-pandemic mortality rates that has insurers stymied, the number of Americans claiming disabilities has skyrocketed since 2020, adding another puzzling factor that could impact corporate bottom lines.

Increases of this magnitude in the numbers of those disabled may not be noticed by most but they will have an impact on us all.

The cause of the increase may be a mystery but the effects will be momentous.

Everyone will be impacted in some way and some manner.

The answer as to WHY should not be wrapped in such perplexity.

Who Benefits From Artificial Intelligence?

A study released last week by MIT's NANDA initiative found that 95% of generative Artificial Intelligence (AI) projects at corporations are delivering little to no measurable impact to the bottom line.

The report indicated that $30-$40 billion has been invested in AI projects at companies but only 5% are seeing meaningful returns from that investment.

An article on the MIT report by The Hill summarized the conclusions this way.

Many companies are implementing tools like OpenAI’s ChatGPT and Microsoft Copilot, with over 80 percent having explored or piloted these technologies, and nearly 40 percent reporting their deployment. However, these tools primarily function to enhance individual productivity rather than contribute to overall company earnings.

Most times, AI integration fails to contribute to profits “due to brittle workflows, lack of contextual learning, and misalignment with day-to-day operations,” the MIT report reads.

The AI systems are unable to learn and think in ways humans can, as “most GenAI systems do not retain feedback, adapt to context, or improve over time,” it continued.

Last week also saw Open AI CEO Sam Altman (that runs ChatGBT) state that he is concerned about an AI bubble forming as spending on the industry surges.

Source: https://www.cnbc.com/2025/08/18/openai-sam-altman-warns-ai-market-is-in-a-bubble.html

 

Altman warned that some are going to get burned in a big way when the bubble bursts.

“When bubbles happen, smart people get overexcited about a kernel of truth,” Altman told a small group of reporters last week.

“Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes. Is AI the most important thing to happen in a very long time? My opinion is also yes,” he was quoted as saying. 

Altman appeared to compare this dynamic to the infamous dot-com bubble, a stock market crash centered on internet-based companies that led to massive investor enthusiasm during the late 1990s. Between March 2000 and October 2002, the Nasdaq lost nearly 80% of its value after many of these companies failed to generate revenue or profits. 

It will not be the first (or last time) that human beings have let their emotions outpace reality.

Famous bubbles in the past resulted from the introduction of railroads, radios and the internet.

Of course, the most insane bubble of all time goes back to the Tulipmania bubble in Holland in the 1600's which followed the introduction of tulips to Europe.

If you are not familiar with the Tulipmania story I recommend you read my blog post on the subject that I wrote a decade ago.

There is little question in my mind that AI will be transformative. However, it remains to be seen exactly who will benefit and the extent of that value.

One thing seems likely as to those who are benefiting the most from AI in the short term.

Consider this chart that shows the usage of ChatGPT over the last couple of years.

Usage seemed to drop each summer when school was out.

Students seems be using AI quite a bit.

A report last year found of college papers reviewed by a plagiarism detection service that 22 million papers (11% of the sample that were turned in) used AI to generate at least 20% of the paper.

Source: https://qz.com/how-many-students-use-ai-write-papers-1851407205

Is it just a coincidence that the only decreases in the meteoric rise of ChatGPY usage coincides with the end of high school and college academic calendars?

If AI is being used to any significant degree by students it also raises the additional question of whether the short-term benefit they receive from AI will be offset by the long-term reality that they are ill-equipped to think on their own in the future?

That also forms the underlying question I have about AI in general.

Will it be one of the greatest advances in the history of humanity or mark its end?

We are in for some very interesting times in the future and it is coming at us very fast.

DC Crime Crackdown

President Trump is taking a lot of heat from Democrats on his crackdown on crime in Washington, DC.

Democrats claim that this is another example of an unhinged Trump being a dictator.

They say that everything is fine in the nation's capital and crime has been dropping the last few years so this crackdown on crime is unnecessary.

That claim might be more credible if a police commander in the city had not just been placed on leave for deliberately falsifying crime data.

Credit: https://x.com/JackPosobiec/status/1954935183511343318

However, even if you agree that DC crime rates have improved, it seems that the city has a long way to go in comparison with other world capitals.

Credit: https://x.com/AAGDhillon/status/1953518617124818948

It is also interesting to see the underlying statistics involving homicides in Washington, DC.

The National Institute for Criminal Justice Reform prepared a "Gun Violence Problem Analysis" of all homicides in the city between January, 2021 and December, 2022. that was published last year.

This is a breakdown on the homicides and non-fatal shootings in DC for that period by sex and race

Source: https://nicjr.org/wp-content/uploads/2024/03/DC-GVPA-1.2024.pdf

A few key points on the data involving homicides.

96% of the suspects were male.

88% of the victims were male.

96% of the suspects were Black.

95% of the victims were Black,

Blacks make up 46% of DC's population but 96% of the homicide suspects.

Whites make up 38% of the population but only 1.3% of the suspects.

Hispanics comprise 11% of the population but only 1.7% of the suspects.

Asians are 11% of the population but just 0.9% of the suspects.

Homicides and shootings are overwhelmingly Black on Black violence.

The other interesting factoid in the report is the extent to which both suspects and victims in homicides in D.C. had been previously arrested.

The average for both was 9.7 arrests!

Source: https://nicjr.org/wp-content/uploads/2024/03/DC-GVPA-1.2024.pdf

This data suggests that a disproportionate amount of serious crimes are committed by a small number of criminals.

This is not something that is unique to Washington, DC.

In fact, a past study showed that of those admitted to state prisons in 2014, over 80% had been arrested more than 3 times before the crime that put them in prison.

Less than 5% of those admitted to prison had been arrested only the one time that led to the prison sentence.

The median number of arrests was 9!

Source: https://inquisitivebird.xyz/p/the-case-for-prisons

This data suggests if we got the very worse offenders off the streets of D.C. and other major cities in the United States, crime rates might drop by as much as 80%.

Yes, there was a logical rationale for the "three strikes laws" that were enacted in a number of states in the 1990's.

The National Institute for Criminal Justice Reform report also "included small group and individual interviews with more than 70 MPD officers selected for their particular knowledge and expertise of gun violence throughout DC." 

The police officers were asked what would be most helpful in breaking the cycle of crime and violence in DC.

The biggest factor seemed to center around "a feeling of impunity among many people on the streets that may be encouraging criminal behavior."

Numerous officers throughout the District also identified two issues that combine to create the feeling of impunity among people who engage in violence that have emboldened them to commit further acts of violence: a high bar for making arrests and a reduction in proactive policing.

The first issue is the feeling from officers that the criminal justice system is broken in theDistrict. They cited an extremely high bar for making arrests, claiming it has been elevated to a beyond a reasonable doubt standard usually reserved for convictions in court. Officers also complained of some cases not being charged or when they are, the defendant being allowed togo home to await court proceedings.

The second issue officers noted was a significant reduction in proactive policing due to what  they describe as a police department and DC Council that have made policy decisions that create strict rules where officers fear being disciplined or even fired for violating the new rules.For instance, the District enacted a unique consent search law that requires an officer to read a legal rights statement before conducting a consent search. There is also a relatively high threshold for when officers are allowed to chase a suspect in a vehicle, which officers claim has nearly ended vehicle chases.

In other words, the DC government has not shown the will to do what its own police officers suggest would make the biggest difference in combating crime and violence in the city.

President Trump has the will to do it.

There is also little doubt that his efforts will show results.

And this is undoubtedly the real reason that Democrats are complaining about Trump's actions.

They simply cannot afford success by Trump in DC like he had on the border.

Too Hot To Learn?

It seems that there are no lengths that those pushing the climate change narrative will not go to further their agenda.

The latest example is contained in this article in The Los Angeles Times that cites a study that claims that extended exposure to heat significantly impairs students' academic performance.

Source: https://www.latimes.com/environment/story/2025-07-31/rising-heat-consequences-for-students-new-study

It raises the question as to whether there is anything that climate change cannot be blamed for?

This study is particularly useful for progressives as it also provides an argument that the heat also disproportionately disadvantages people of color or those with lower incomes.

According to the paper, students from lower-income families often have less access to air-conditioned classrooms and homes, making them more vulnerable to the harmful effects of heat. Racial disparities were also evident in the data, with Black and Latino students in the U.S. seeing up to three times greater cognitive losses due to heat compared with their white peers.

“There are larger numbers of Black and Hispanic people living in poorer areas where the conditions are worse, temperatures higher, and air conditioning and ventilation often lacking,” Vasilakopoulou said.

It is also convenient to absolve public schools and parents for any responsibility for student academic underperformance.

Of course, if heat is causing students to underperform you wonder how anyone learned anything in the past?

That is particularly true in the United States when in the 1930's and earlier periods temperatures were much higher than we have today.

The 1930's was also a time in which air conditioning was almost non-existent.

The only place you would typically find it was in movie theaters and department stores.

In fact, as late as 1960, only 12% of U.S. households had air conditioning.

Even in the hot southern states, less than 20% had it.

88% of U.S. households now have AC.

Source: https://64parishes.org/suddenly-less-summer-how-air-conditioning-transformed-the-south

Electric fans were not even introduced to the public at large until the early 1900's.

Credit: https://familytreemagazine.com/history/timelines/electric-fans-timeline/

Self-contained window fans were not introduced until 1934.

It makes you wonder how human beings had any cognitive abilities or learned anything at all due to the heat in earlier years.

Beyond all of this, it is interesting to look at academic performance in the United States over the last decade.

No state has improved more significantly in the education of its students than the state of Mississippi.

Yes, Mississippi.

Many in education are referring to it as the "Mississippi Miracle".

Mississippi ranked 48th in the country in education in a widely-recognized national ranking in 2014 but improved to 16th last year.

Source: https://www.supertalk.fm/report-mississippi-earns-no-16-national-ranking-in-education/

This is the same state where the temperatures can be very, very hot.

Mississippi is also the poorest state in the country.

Mississippi had the lowest per capita income in the nation in 2024.

However, its students are outperforming California and New York that have a lot more money and a lot less heat than Mississippi.

Credit: https://x.com/amuse/status/1916885709224595810

Students in hot Mississippi are also reading better than students in colder Wisconsin and Michigan.

Mississippi is also the state with the highest percentage of African Americans (37%) in its population.

Based on the study cited in the LA Times, Mississippi should have horrendous student performance due to "climate change".

In fact, adjusted for its demographics, Mississippi actually just finished ranked first in the nation on NAEP scores.

Source: https://www.stevesailer.net/p/naep-test-scores-mississippi-miracle

Do you notice who was dead last on this score?

Oregon which holds the following view about education.

Source: https://www.oregonlive.com/education/2023/10/oregon-again-says-students-dont-need-to-prove-mastery-of-reading-writing-or-math-to-graduate-citing-harm-to-students-of-color.html

How has Mississippi transformed its public eduction system?

It went back to basics like focusing on reading, writing and arithmetic.

It placed particular emphasis on literacy in K-3 focusing on phonics, fluency, vocabulary and comprehension.

Students who do not meet standards in the 3rd grade face retention. This accountability has resulted in gains in English Language Arts and math achievement into middle school.

Since reading is such a foundational ability to everything else, paying attention to this early skill has compounding benefits for all education that follows.

Why is it that liberals seem to have an excuse for almost everything?

They look to racism, income inequality, lack of tax dollars or climate change for excuses but never want to confront what the real problem might be.

Students are underperforming because of climate change?

Seriously?

Who would have thought that just focusing on what schools are supposed to be doing and holding students accountable would bring results?

This is a lesson that ought to be taught more widely.

What Would FDR Have Done?

President Trump marked the 90th anniversary of the enactment of Social Security in an Oval Office ceremony last week.

Source: https://www.ssa.gov/news/en/press/releases/2025-08-14.html

Franklin Delano Roosevelt signed the Social Security Act into law on August 14, 1935.

Lost in history is this quote from Franklin Delano Roosevelt in his message to Congress on January 17, 1935 asking Congress to enact the Social Security program.  It is clear that Roosevelt understood that the program he was asking for was unsustainable in the long term and had to be replaced by a "self supporting system" in 30 years or so.  Unfortunately, that was 60 years ago.

In the important field of security for our old people, it seems necessary to adopt three principles: First, non-contributory old-age pensions for those who are now too old to build up their own insurance. It is, of course, clear that for perhaps thirty years to come funds will have to be provided by the States and the Federal Government to meet these pensions. Second, compulsory contributory annuities which in time will establish a self-supporting system for those now young and for future generations. Third, voluntary contributory annuities by which individual initiative can increase the annual amounts received in old age. It is proposed that the Federal Government assume one-half of the cost of the old-age pension plan, which ought ultimately to be supplanted by self-supporting annuity plans.

FDR openly admitted when the legislation was proposed that Social Security would need to be transitioned to a self-supporting annuity plan system in about 30 years in which the contributions of workers and employers would fund their future Social Security annuity payments. 

FDR also envisioned a system by which individuals could add voluntary contributions to increase the annual amounts received in old age recognizing individual initiative.

Apparently, everyone forgot about FDR's roadmap of how Social Security should work in the future in order to be sustainable.

We are going to come face to face with this reality over the next decade.

Social Security has been running a deficit between payroll tax revenues and payments to beneficiaries since 2010. It has been able to pay benefits and stay solvent by using "reserves" from payroll tax surpluses from prior years and interest income on the treasury bonds that the reserves are invested in.

However, we are now on a path that the deficits will get significantly larger each year.

Source: https://www.federalbudgetinpictures.com/social-securitys-deficits-2/

Reserves at January 1, 2025 were $2.7 trillion.

However, the most recent Social Security Trustees' Report estimates that the reserves will be completely exhausted during 2034---just nine years away.

Credit: https://newpittsburghcourier.com/2025/04/16/social-securitys-trust-fund-could-run-out-of-money-sooner-than-expected-due-to-changes-in-taxes-and-benefits/

At that point, current payroll tax revenues will only be able to pay 77% of projected Social Security benefit payments.

Why are these numbers important?  Despite the fact that you always hear about the Social Security Trust Fund there is nothing to trust.  It is a fiction.  Social Security can only pay benefits if it has revenues coming in.  

It is a 'pay-as-you-go' system that some would argue is one step removed from being considered a Ponzi scheme. The one step is the fact that it is government sanctioned.  It needs a continual flow of payroll taxes from new workers to pay the promised benefits of the older workers.  It worked well in the early years when there were a lot of workers paying in and few beneficiaries.  This is no longer the case.

In 1950 there were 16.5 workers for every person on Social Security. In 1970, there were 3.7. By 2000 it was down to  3.4. There are now only 2.7 workers paying in for every one beneficiary.

The projections are that it will be 2 workers or less for every beneficiary within the next 25 years.

When the trust fund is empty in 2034 it will mean that everyone on Social Security will need to have their benefit reduced by about 25% unless major reforms to the system are enacted.

Social Security was a good deal for my parents and grandparents. This was primarily due to the fact that the taxes they paid were very low.  For example, the tax rate was only 1% and the maximum wage base was only $3,000 for the first decade and a half of Social Security.  That is $30 per year.  

Benefits received for the average wage earner were approximately what could be earned if the employee and contributions were invested in a safe bond portfolio earning 3%.

When I graduated from college in the early 1970's the maximum tax was $414 per year.  The maximum tax today is $10,918 per employee (matched by an equal amount by the employer). A self-employed person has to pay both the employee and employer shares.

Baby boomers will just marginally get a small return on the money contributed in the employer and employee shares over the years. 

The average earner will pay $4,131 in Social Security taxes in 2025.  Of course, this amount must be matched by the employer.  The tipping point has long since been reached on receiving a fair return on the amounts paid into Social Security. It is not even a break even deal for most people retiring today.  If you are under age 50, you are going to be taken to the cleaners as the law now exists.

Workers under age 50 today will only receive less than one-half of what their contributions would have earned even if the money had been invested received a modest annual investment return of 5% over their lifetimes.

This is a chart that Grok prepared for me comparing SS contributions and benefits for an average income worker at various birth years compared to what the contributions would have been worth if invested at 3%, 5% and 7% rates of returns 

 

One of the biggest failures of the Clinton Administration was not fixing Social Security.  The economy was growing, the stock market was booming, the federal government was running an overall surplus. You also had Republicans in Congress that would have seen that it got done if the President would have shown leadership on the issue. In addition, Social Security was running annual budget surpluses each year.  In 1998 it was $100 billion. This money could have been used to reform the system. 

For example, in the period between 1997 and 2009, Social Security took in almost $2 trillion in revenues in excess of benefits. By law, this could only be invested in treasury securities. 

However, the effect of this is that the federal government used this money to fund a lot of deficit spending as got into the 2000's. It was able to use the Social Security surplus revenues to pay for welfare, defense and a thousand other things and did not have to go to the debt markets and borrow the money. 

All the federal government had to do was give the "Trust Fund" an IOU for the money to paper over the deficit spending. 

Of course, that IOU is now due and the federal government has to go to the markets today and borrow even more money to replace the treasury bonds that Social Security is cashing in to pay benefits.

President George W. Bush made an effort to reform Social Security in 2005---20 years ago. It made a lot of sense since the reserves in the trust fund had grown to substantial amounts and were still growing as the Baby Boom generation reached their peak earnings years.

Bush's plan would have allowed younger Americans to establish voluntary personal accounts in which workers could invest part of their payroll taxes much as FDR envisioned 70 years before.

His plan would have also curbed the benefit formula for higher income workers but left in place the formula for average and lower incomes.

This would have taken a great deal of pressure off of Social Security's future funding issues as well as providing younger workers the opportunity to get a fair return on their lifetime of Social Security contributions.

The proposed legislation went nowhere in the face of sustained demagoguery by Democrats and the AARP  that the Bush plan would involve "gambling" on the stock market.

20 years later we can assess how that would have worked out.

Those voluntary accounts would have performed spectacularly for the benefit of the Social Security recipients under almost any investment scenario.

The S&P 500 increased 428% since Bush proposed reforming Social Security. That is a compound annual growth rate of 8.7%.

S&P 500- August, 2005-August, 2025
Source: https://www.macrotrends.net/2324/sp-500-historical-chart-data

The NASDAQ did even better---up 909%. That is an annual growth rate of 12.2%.

NASDAQ Composite-August, 2005-August, 2025
Source: https://www.macrotrends.net/1320/nasdaq-historical-chart

An investment totally in US Treasuries would have still produced a 4.13% annual compound return over the last 20 years despite the rise in interest rates over the last few years.

All of these would have produced much higher retirement benefits than Social Security is providing.

A grave error was made in not reforming Social Security 20-30 years ago when there was a surplus to work with and there was time to implement the reforms.

No such luxury exists today.

Social Security will have to be reformed in the next decade and it will be painful.

Current beneficiaries will likely not see their benefits cut but that is not assured depending on the nation's overall debt situation.

Retirement ages for younger Americans will undoubtedly increase.

The FICA tax will increase for everyone. but it will not mean higher benefits in the future, The returns on Social Security contributions will just get worse.

The payroll tax cap for high earners will be increased significantly if not completely eliminated.

Social Security will become more like a redistributive welfare program than the insurance program that it was originally designed to be. 

FDR laid out what had to be done 90 years ago.

Roosevelt is the liberal icon that all progressives lionize.

However, when it really counted no one paid attention to what he said was necessary when he proposed the program in 1935.

As a result, there will be an enormous price to pay to maintain Social Security's solvency and sustainability that we will find out within the next 10 years.

Inflation Watch

The monthly CPI (consumer price index) numbers seem to get more and more attention every month.

A big reason is that the Fed has been reluctant to lower interest rates until it sees inflation returning to at or below its 2% annual target.

A lot of progress has been made since the U.S. was experiencing a 9.1%  annual inflation rate in June, 2022.

However, Fed Chairman Powell has stated that uncertainty about any inflationary effects of the Trump tariffs are preventing the Fed from making any changes in the Fed rate.

The July CPI number that was released earlier this week had inflation rising .2% for the month.

That rate was actually lower than the .3% in June.

The 12-month CPI number is at 2.7%.

Both numbers were better than expected.

What I found interesting in the CPI print was that, despite all of the concerns about the tariffs being inflationary, the inflation we are seeing is being driven primarily by items that are not subject to tariffs.

In fact, most of the larger increases involve services rather than goods.

Shelter                                                                    +0.2%

Medical services                                                   +0.8%  

Dental services                                                      +2.6%

Tuition and child care                                          +0.4%

Used cars and trucks                                            +0.5% 

Garbage and trash collection                               +0.6% 

Tax preparation and accounting services.        +3.5%               

Airline fares                                                             +4.0%

On the other hand, there was no inflation in categories we are told would become more expensive due to tariffs.

Food at home                                                        -0.1%

Appliances                                                             -0.9%

Toys                                                                        -0.2%

Apparel                                                                   0.1%

Gasoline                                                                 -2.2%

Computers, phones and tech hardware            0.0%

Housekeeping supplies                                        0.0%

New vehicles                                                          0.0%

Could it be that the tariffs do not have anywhere near the impact on inflation compared to the money printing that the Federal Reserve has done?

The Fed was tightening for about 18 months after the insane amounts of money that were pushed into the economy during Covid. That ceased in early 2024.

The money supply is increasing again at the highest rates since July, 2022.

Source: https://fred.stlouisfed.org/series/M2SL

In fact, it took over 200 years for the money supply of the United States to reach $11 trillion.

The money supply has now increased by that amount in a span of less than 12 years.

Credit: https://x.com/JeffWeniger/status/1955427834018795939

It will be interesting to watch the inflation data in succeeding months but to this point it is difficult to see that the tariffs are having much effect on the inflation numbers.

The PPI (producer price index) came in for July at a higher rate (3.1% year over year) than the CPI number and suggests that consumer prices may be headed higher in the next few months. The monthly increase was also the highest seen since June, 2022.

We will have to see how that develops.

However, the money supply that the Fed controls clearly had everything to do with the inflation we saw in the aftermath of Covid. 

Are the increases in the money supply we have seen recently having a greater effect on inflation than the tariffs?

Let's not forget what Nobel Prize winning economist Milton Friedman said on the subject of tariffs many years ago.

Is the Fed watching what really matters regarding inflation?

Who is it that controls the money supply?

Not Likely To Get Better

In the aftermath of the street violence in Cincinnati several weeks ago there has been a lot of talk about the need for political leadership changes in the city.

Many people suggest that we are going to see the voters of Cincinnati rise up in the next election and vote for leaders who support law and order and reject the woke policies and sanctuary city status that have been instituted in the city in recent years.

That is what should occur if common sense prevailed. 

However, taking a look at what has happened in other large American cities facing similar problems it is not likely to get better in Cincinnati.

For example, let's look at the three largest American cities---New York City, Chicago and Los Angeles--and examine what we have seen as these cities deteriorated.

They did not reject the course they were on. They all doubled down on the failed policies by electing mayors that were even more liberal.

Eric Garcetti was Mayor of Los Angeles from 2013-2022. Like all other big city mayors, he was a Democrat.

Garcetti would be described as a progressive but he also was pragmatic.

When Garcetti left office he was replaced by Karen Bass. Bass is objectively much more liberal than Garcetti. She has been called a socialist and communist by some. Part of that is due to her many trips to Cuba over the years and the glowing words she used to describe Fidel Castro.

Mayor Karen Bass of Los Angeles
Credit: https://www.dailynews.com/2024/07/03/los-angeles-mayor-karen-bass-announces-her-2026-reelection-bid/

In fact, when Bass was being considered as a possible VP pick by Joe Biden in 2020 she had to say this to NBC News to tamp down that talk.

“I’m not a socialist. I’m not a communist. I’ve belonged to one party my entire life and that’s the Democratic Party and I’m a Christian,” Bass told NBC News.

There is little question that LA has gone further left as their problems have grown.

The same is true in Chicago.

Lori Lightfoot was a disastrous left wing mayor in the Windy City who had replaced establishment Democrat Rahm Emanuel.

Former Mayor Lori Lightfoot of Chicago
Credit: https://www.politico.com/news/2022/01/09/lightfoot-chicago-teachers-deal-abandoned-526807

Violent crime went up 40% during the Lightfoot era.

The city's debt burden continued to increase to one of the highest of any city government in the United States. Much of that is tied to rich pension programs for the city's public sector employees.

What did the voters do when they turned their back on Lightfoot in the 2023 Democrat primary.?

They went even further left and elected Brandon Johnson.

Mayor Brandon Johnson of Chicago
Credit: https://www.axios.com/2023/04/05/chicago-mayor-election-result-brandon-johnson

Debt and crime in Chicago are even worse now than it was with Lightfoot.

The Wall Street Journal recently named Johnson "America's Worst Mayor".

Johnson believes the way out of the mess that Chicago is to enact a wealth tax on the city's residents.

Put aside the fact that a wealth tax might not be constitutional.

Johnson also seems oblivious to the fact that no one has to live in Chicago and have their wealth taxed away to pay for illegal immigrants, rich government pensions and failing schools .

Will the last person in Chicago please turn off the lights?

Finally, we have New York.

In the past, New York City was blessed with Mayors like Rudy Giuliani and Michael Bloomberg who were level headed and practical. They understood that public safety was the most important issue in any city. They used the police to get criminals off the streets and made sure New York City was an attractive place to visit and do business in.

Source: https://www.ebay.com/itm/293671934922

New York City went from Bloomberg to Bill DeBlasio who was most interested in income inequality issues and had a contentious relationship with the police.

When he left office after his two terms he ran for the Democrat nomination for President in 2020.

DeBlasio regularly polled at 0% among Democrat presidential candidates including in his home state of New York. He was forced to drop out of the race after not qualifying for the debates and endorsed Bernie Sanders. What more do you have to know about De Blasio's political philosophy?

There was some hope for NYC as DeBlasio was replaced by Eric Adams who was a former police officer who ran as a moderate and stated he would be more serious about crime and public safety issues.

However, Adams got engulfed in ethics investigations during his term which hindered his effectiveness as Mayor. He saw his approval rating sink and determined he was not viable as the Democrat candidate in 2025. He is now running as a long shot independent.

To replace Adams, Democrats have gone about as far left as they can and nominated a candidate who openly espouses proudly socialist and communist policies---Zohran Mamdani.

In the past he has been a proponent of defunding the police and has shown disdain for private property rights.

His "big ideas" are to have city-run grocery stores and freeze rents for 2 million people.

Mamdani will be the next mayor of NYC unless a miracle occurs between now and November.

This is the most recent polling on that race.

No one should expect a miracle to occur in New York City.

Or for common sense to reappear in Cincinnati, LA or Chicago.

Why?

The simple truth is that the majority of the voters in these cities are voting for who is going to give them what they want.

Free stuff for themselves and illegals.

Promises that they will make the rich pay more.

Big pensions for public workers paid by everyone else.

Reduced police patrols and crime enforcement.

Low bail policies.

Legalized drug policies.

There is no longer a majority of voters living in big cities who believe in the things that we used to take for granted.

The majority in a democracy rules and the majority in these big cities are voting for the people that tell them they will give them free stuff and let them do whatever they want on the streets.

Those that have common sense get smaller every year as they flee these cities and the liberal policies for the suburbs or rural areas where they can feel safe and free.

That is the reality.

In the last presidential election 76% of the voters in the city of Cincinnati voted for Kamala Harris.

Sadly, it is not likely to get better in Cincinnati or any other big city.

It is most likely only going to get worse.

The math is inescapable.

A democracy gives people the government the majority wants.

It may not be what they need.

That is a big reason that our nation's founders established the United States of America as a constitutional republic which tempers majority rule with protections for minority and individual rights and attempts to limit government power.

The wisdom of our founders becomes more apparent every day as we watch what is happening in the nation's largest cities.

Planes, Trains and Data

It was recently announced that the Union Pacific railroad was seeking to merge with Norfolk Southern.

The deal would create the first U.S. transcontinental railroad.

Source: https://www.foxbusiness.com/lifestyle/union-pacific-norfolk-southern-merge-creating-first-us-transcontinental-railroad

What caught my eye in the announcement was that Norfolk Southern was being valued at an $85 billion  in the deal.

If approved, the combined Union Pacific/Norfolk Southern could be valued at more than $250 billion.

BNSF (Burlington Northern Santa Fe) is the other railroad industry giant. It is privately owned by Warren Buffet's Berkshire Hathaway but is valued individually at $200 billion according to one analyst.

CSX is the other major U.S. railroad and is valued at $66 billion at its recent stock price.

In total, these U.S. rail companies have a total market cap value of about a half a trillion dollars.

How does the market value of what many see as the boring and old rail business in the United States compare to the more glamorous and newer airline business?

Here are the current market values of the leading U.S. air carriers

American           $8 Billion 

Delta                 $35 Billion 

Southwest         $16 Billion 

United               $29 Billion 

This chart puts it in a little better perspective.

You begin to understand the significance of the Union Pacific/Norfolk Southern deal when you realize that Norfolk Southern is being acquired at a price that is almost equal to the value of all four of the major U.S. air carriers.

What else can we conclude from this data?

It appears to be a lot more profitable to transport freight than people.

This data also does not suggest an optimistic outlook for high speed passenger rail in the United States.

If the rail companies saw high speed rail as a lucrative enterprise these private sector companies clearly have the experience and financial capability to make it happen.

The private sector obviously does not see high speed rail as economically viable.

Instead, liberals want government to fill the void and provide high speed passenger rail service anyway.

How has that worked out in California?

In 2008, California voters approved a proposed high speed passenger rail line between Los Angeles and San Francisco that voters were told would cost $33 billion.

17 years later not one mile of passenger track is in service and the cost is now projected to exceed $128 billion for a scaled down plan.

It was originally stated the high speed rail line would be operational by 2020. New estimates put that date into the 2030's if it gets completed at all. 

That is looking more unlikely as the Trump administration is pulling federal funding for the project which has already seen $7 billion of taxpayer dollars go to California.

Of course, all of this was predictable from the start.

In fact, I wrote a blog post in 2012 that the high speed rail project looked to be "a train to nowhere" and quoted from an article by Joel Kotkin titled " The Great California Exodus".

Gavin Newsom has replaced Jerry Brown as Governor since that time.

Things have only gotten worse in California in the last 13 years.

Mr. Kotkin calls the runaway-cost train "classic California." "Where [Brown] with the state going bankrupt is even thinking about an expenditure like this is beyond comprehension. When the schools are falling apart, when the roads are falling apart, the bridges are unsafe, the state economy is in free fall. We're still doing much worse than the rest of the country, we've got this growing permanent welfare class, and high-speed rail is going to solve this?"

The first clue to the liberal Democrats should have been when Union Pacific did not see the great opportunity to build its own high speed line between LA and San Francisco years ago.

Merging with Norfolk Southern is a much better deal.

Sadly, for what California is projected to spend on its high speed rail project, it could have acquired all the major U.S. airline carriers and had money left over,

Or it could have bought Norfolk Southern and Delta (or United). Or both American and Southwest.

The numbers and data always tell a much bigger story than you can imagine.

Why is it that liberal Democrats always seem to ignore reality?