Monday, November 29, 2021

Oh no! Omicron!

The news of the new Covid variant identified in Africa in the last few days says a lot about the times we are living in.

First, a lot can change in a very short period of time.

In addition, there seems to be no bounds to the panic porn that results from anything to do with Covid.

Before we get into discussing the Omicron variant seriously consider another two things.

MORONIC is an anagram you can make out of Omicron. Is that merely a coincidence? Someone, Somewhere really has a sense of humor.

It is also interesting that the WHO decided to name the newly identified B.1.1.529 variant Omicron bypassing the next two Greek letters in the naming conventions they have been using for the Covid variants.

I understand skipping Nu. After all, this is hardly a "new" variant at this point.

The WHO also clearly was not going to name this variant Xi were they?

Might that remind people around the world where this pandemic started?

After all, you can argue that Xi could be used to describe all of the Covid variants because all questions about where Covid came from seem to lead to the leader of the Chinese Communist Party and what the CCP was doing in that lab in Wuhan.

Omicron avoids a lot of problems for China and the World Health Organization.

It seems that the Omicron variant first made news when Botswana announced that it had identified it in samples taken on November 11.

It was later revealed that the variant was discovered in four foreign diplomats who had entered the country all of which had been fully vaccinated. They had entered the country on November 7 and the positive tests were collected as they were departing the country on November 11. It has never been disclosed which countries these foreign diplomats came from.

Could it have been South Africa?

South Africa stated that it found Omicron in samples collected on November 14. It seems to be the country in which most of the focus over the variant has come from.

However, the variant has been subsequently found in 14 other counties including Belgium, UK, France, Germany, Netherlands, Canada and Hong Kong according to The Washington Post.

Of these, Belgium is the largest trading partner of Botswana outside of South Africa. It is their largest export partner. To me, that is a more likely source for the variant than South Africa. Since Belgium is the country that Botswana exports to more than any other country it is also logical that it would not disclose to the public where those foreign diplomats were from. That might prove bad for future business.

For example, consider recent cases in the three countries--Botswana, South Africa and Belgium.

Where do you think it is more likely that a positive case came from?

Joe Biden imposed a travel restriction on people from eight African countries from traveling to the United States as of November 29 which include  Zimbabwe, Botswana, Lesotho, Namibia, Eswatini, Malawi, and Mozambique. 

Of course, this is the same Joe Biden who called Donald Trump racist and xenophobic for instituting a travel ban on China early in the pandemic when cases were exploding in that country.

It was racist to do this with China but not with African countries?

What are the recent case numbers in those African countries compared to the United States and the EU?

Their confirmed cases barely show up on the chart.

Does this look more like a political decisions or a decision based on data and science?

What do I make of Omicron?

We clearly need to be cautious and find out more but it feels like an overreaction based on what I am seeing right now.

What I find most interesting (and troubling) it that so many of the cases we know about right now have been in international travelers of which most are fully vaccinated.

When I see this I cannot help but think of the warnings of Geert Vanden Bossche about the increased risk of mutant variants as the virus attempts to work around the mass vaccination effort. I wrote about his thesis here.

Vanden Bossche has warned from the beginning that mutations are much more likely to occur within the vaccinated population and the speed in which mutations occur is accelerated due to mass vaccinations during a pandemic.

This will end up increasing (rather than decreasing) risk of severe disease in the vaccinated due to ADE (antibody dependent enhancement) and compromised natural immunity due to the vaccine.

His thesis is similar to what we hear about the overuse of antibiotics to treat bacterial infections. The more that they are used (or overused) the greater the chance that the bacterial infections will get stronger and eventually evade all antibiotics.

Is Omicron and the other major variants being caused by the vaccines?

This is what Vanden Bossche has written in response to the emergence of the Omicron variant.

The world may be taken by surprise but that doesn't include us. It remains to be seen whether Omicron can outcompete Delta (to be confirmed). If that’s the case, we're definitely not in good shape.

In case of CoV, innate immunity protects the individual and the 'herd' ( sterilizing immunity, no natural selection pressure, herd immunity) whereas adaptive immunity induced with leaky vaccines has exactly the opposite effect.

THE big Q is whether such an immune escape variant could even resist naturally acquired Abs in people who recovered from C19 disease. I am, indeed, cautious and worried about ADE, even in the unvaccinated who recovered from C-19 disease as they may no longer be able to control viral infection. ADE would equal ‘enhanced virulence’. Difficult to predict.

Mass vaccination has compressed the evolutionary trajectory of the virus from a few hundred years (?) down to one year. Hope that naturally primed individuals can deal with that speed.


This is confirmation to me why we need to look at what develops with Omicron very cautiously.

The normal natural progression of a respiratory virus is that it becomes more infectious but less lethal over time as it mutates.

For example, mutations of the deadly Spanish flu of 100 years ago are still circulating today but they have faded as a significant health threat to most people. Many have built up broad antibodies to deal with it as the virus has evolved over the years. As a result, it is really not a health threat today even though it still circulates.

The fact is that the Covid pandemic has already lasted longer than most respiratory virus pandemics we have seen in the past. Most burn out within 18 months. That was the case with the Spanish flu.

We are beyond that point with Covid even with a vaccine deployed less than a year after the emergence of the virus which we did not have in previous respiratory virus pandemics.

Early in the pandemic I read a paper which stated that it was unwise to predict how long Covid would be with us. In particular, we should not compare how long Covid would last with what we experienced with the Spanish flu.

The authors, a virologist and historian at the University of Pittsburgh, pointed out that SARS-CoV-2 and influenza are biologically different.

They both have RNA material. RNA viruses tend to accumulate a lot of mutations as they multiply. However, they "typically don't double-check copied genes to correct errors during replication".

That is not the case with coronaviruses according to the authors. They do proofread their copied RNA which means they naturally have a lower relative mutation rate.

Read what they stated early in the pandemic (June, 2020).

Coronaviruses actually do proofread their copied RNA to fix inadvertent errors during replication, which decreases their relative mutation rate. From the originally sequenced SARS-CoV-2 in Wuhan, China in December 2019 to recently banked sequences from the U.S., there are fewer than 10 mutations in 30,000 potential locations in its genome, despite the virus having traveled around the world and through multiple generations of human hosts. Influenza makes 6.5 times more errors per replication cycle, independent of entire genome segment swaps.

The relative genetic stability of SARS-CoV-2 means that future peaks of disease are unlikely to be driven by natural changes in virulence due to mutation. Mutation is unlikely to contribute to predictable “waves” of COVID-19.

If that is the case, why are we seeing these significant mutations in Covid?  

Why is the data from around the world showing significant numbers of people being infected in areas with high vaccination rates?

For example. let's take another look at Belgium.

75% of the population is fully vaccinated.

Confirmed cases are almost at all-time highs. They are up 9-fold since October 1.

There is evidence in Belgium and other countries that the vaccines may be preventing deaths. However, that means the vaccines are only useful as private protection for those who feel the need for it. They are not providing the stated public health goal of preventing infections and transmission such that mandates should be required.

The authors of the article cited above predicted that the pandemic would continue, not due to Covid mutation or increased virulence, but by the further exposure of non-immune people to the virus.

They predicted future COVID-19 cases and deaths would continue at a relatively steady state with periodic local flare ups very likely driven by how compliant people are in using non pharmaceutical interventions (social distancing, lockdowns, washing hands---at this point masks were not even mandated in most states).

They concluded with this statement on how they predicted the pandemic would end.

This scenario will continue until the U.S. population gains herd immunity, ideally accelerated by vaccination.

I don't think in their wildest imaginations they would have believed that we would have 75% vaccinated, many more who were previously infected with natural immunity, and seeing this surge in cases almost two years into the pandemic.

It seems to defy both the principles of virology and the lessons of history.

In many places around the world cases have accelerated as vaccination levels increased.

How do you explain it?

The good news out of South Africa is that the early reports of cases of Omicron appear to be mild.


That news did not seem to get through the panic porn media when news of the first reports of the new mutation hit the financial markets.


In addition, the Covid variant fears did much more to the price of oil than Biden's announcement that he was going to raid the Strategic Petroleum Reserve to lower its cost.


In the meantime, Dr. Tony Fauci was on the Sunday news shows and said that we should be prepared to do anything and everything to fight the Omicron variant. That includes further lockdowns but it was "too early to say" whether that would be necessary.


Do I need to remind you that Fauci was also the one who told us in May that it was unlikely that we would see a Covid surge in the coming Fall or Winter because of the vaccines.


"Well, the fact that we have vaccines right now, Chuck, is really a game changer," Fauci told host Chuck Todd on NBC's "Meet the Press." 

At the time, Fauci said that this was dependent on a goal of  70% of the population with a least one dose of vaccine. He said that when children were not even eligible for the vaccines.

The CDC reports that currently 74.1% of everyone age 5+ has received at least one dose as well as 70% of the entire population.

Another 19% have received booster doses which includes 42% of the age 65+ population. In May, there was no mention by Fauci that booster doses were going to be required.

Why does this man have any credibility left?

It increasingly appears that many are tuning him out.

Look no further than this image after the University of Michigan defeated Ohio State on Saturday in their rivalry football game.



It looks like a good portion of the 111,156 in attendance descended on the field after the game. 

Bear in mind that right now Michigan has the highest per capita level of Covid cases in the country.

Are these people just all done with the Covid panic porn?

Perhaps they are just putting Covid into better context.

Look at the number above on cases per 100,000.

In Michigan, there are about 85 confirmed cases per 100,000 people compared to 25/100,000 for the United States as a whole.

Let's assume those people are infectious for 7 days on average. That means in Michigan you would expect 595 infectious people in a crowd of 100,000. 

This is the highest risk population in the United States and that means less than 0.6% of the crowd is infectious based on the data. This is also in an outdoor venue with a lot of ventilation.

Let's put that into further perspective. 

4.4 million Americans are injured seriously enough in auto accidents each year that they need medical care. That works out to be 1,333 per 100,000 in population. That means that more people in that crowd will need medical attention from an auto accident in the next year than were possibly infectious with Covid at that game. And this is in the state with the highest case load in the country right now.

Will we see a further spike in cases as a result of what Dr. Fauci would consider a disturbing "super spreader" event? Let's keep an eye on Michigan over the next several weeks. My bet is that the state is already near the peak of this surge looking at past patterns.

New Reported Cases in Michigan

What we saw at Michigan's football game may just signal we have reached the point that many have become more comfortable with the risks of Covid.

We will see what is to come with Omicron.

Let's hope that it does not outcompete the Delta variant and does not prove to be more lethal contrary to what we would normally expect with the normal evolution of respiratory viruses.

If so, as Vanden Bossche states, we may really be saying Oh No! 

I hope not.

However, if that turns out to be the case, will anybody start to scrutinize what we are doing with these vaccines?

We should be well past the time where there should be any questions whatsoever about their efficacy.

The narrative we hear every day is they are fantastic. They are safe and effective and everything would be perfect if everyone just lined up and took the jab.

The data says something else.

There have been more cases and deaths in 2021 in the United States with the vaccines than in 2020 without the vaccines.

As does the fact that they now want everyone to take a booster who is age 18+.

And Pfizer and the other vaccine makers are already working on an Omicron vaccine.

They say it could be available in 100 days. If that is the case why didn't they modify the boosters to be more effective against the Delta variant already? Delta was first identified in India last December. They had an entire year.

Are people taking jabs for last year's Covid for no reason at all? We are already 8 mutations beyond Delta according to the WHO.


Do not be misled by the narrative that Delta is much more transmissible and infectious than Covid was originally. This is the argument that we often hear as to why cases and deaths are up despite the vaccines.

However, surveillance data from the UK from September indicated that the secondary attack rate within a household from Delta was just 10.6%. The original Covid wild type had a secondary attack rate of 16.6%.

Think about that---almost 90% of people in the same household did not contact the Delta variant of Covid even when living in the same household with a positive case!

Have you ever heard that on CNN, let alone on Fox News?


Once again it does not appear that the data supports the narrative.

The fact that we are this far into the use of these vaccines and the narrative is not supported by the real-world data is far more troubling than anything I can think of.

Oh no!

For sure.

Friday, November 26, 2021

Things That Make You Go Hmmmm-11/26/21 Edition

A we complete the Thanksgiving weekend here is a compilation of interesting data that might make you go hmmmm.

Consumer Sentiment

Economic activity is largely driven by the attitudes and confidence of people in the marketplace. Are they willing to buy because they are optimistic about the future or are they concerned and become defensive with their money?

Any data about how people "feel" is suspect but I must say that this recent University of Michigan survey on current Consumer Sentiment is concerning.

This is a graph that show consumer sentiment for the purchase of houses, vehicles and large household durables.

The survey ask consumers do you think this is a good time to buy these items?


My take is that the shock of high inflation for these items has caused increasing number of consumers to say that they are not interested in buying. The costs have become too high compared to their previous concept of value.

Consumer expectations for inflation over the next 12 months is also the highest it has been in 13 years in the University of Michigan survey. That was in 2008 right before the housing market crashed and we entered the Great Recession. You can see how quickly the inflation expectations reversed once the recession took hold.


People may adjust to the new price levels in time but this may be dependent on wages and employment increasing and easy credit and low interest rates continuing.

Recessions begin due to a combination of factors but loss of confidence by the consumer is at the top of the list.

What lies ahead in 2022?

Biden polls

It can be argued that consumer concerns are also reflected in Joe Biden's current approval ratings.

I looked at several Biden polls this week in some detail that reveal some interesting information.

A Civiqs poll has Biden's approval at 37%. 54% disapprove.

What I found interesting is looking at some of the state numbers.

Consider first off that Biden only has 39% approval in his home state of Delaware.


The four lowest states for Biden.

West Virginia  18%

Oklahoma        22%

Wyoming         23%          

Kentucky         24%

There are only two states that Biden has at least 50% approval.

The four highest states.

Vermont           55%

Hawaii              51%

Maryland          48%

Massachusetts  48%

It is in the swing states that decided the last election that you see Biden's problems most acutely.

Arizona            37%

Georgia            31%

Pennsylvania   38%

Wisconsin        39%     

Here are two states that not long ago were considered to be swing states.

Missouri.         29%

Ohio                 30%

Is that true any more?

A Marist/NPR poll (traditionally a more D-leaning poll) has Biden with a 42% approval rating.

However, what I found interesting in this poll were the internal demographic splits.

This poll has Biden's approval the lowest with young voters. It is highest with older voters.

This is the complete opposite of standard norms.

For example, only 2% of those 18-40 strongly approve of Biden? 

This is where Biden's strongest age group support came in 2020. It is also a group in which the Democrats expect to get 60% of the vote regularly.

On the other hand, Biden is getting his highest approval from older voters. 27% of Baby Boomers (ages 57-75) and 23% of those over age 75 say they strongly approve of Biden.

Only 9% of Gen Xer's (age 41-56) say they strongly approve of Biden.


Interestingly, 55% of young voters say they will stay with a Democrat in the 2022 mid-terms despite their views on Biden. 

However, majorities of all other voter age groups say they will vote for the Republican in the congressional races.


How do you explain it?

My take is that younger voters have borne the brunt of Covid policies. Lockdowns, vaccine mandates and all the rest. They are not happy about it, especially after Joe Biden promised he was going to lockdown the virus, not the economy.

They see higher cases and deaths in 2021 than in 2020 with no end in sight. 

I am guessing they feel they have been badly misled.

One pollster I follow suggests that Biden's drop in the polls beginning in August had more to do with Covid than Afghanistan. Seeing the extent to which young voters are turning on Biden I have to agree.

Richard Baris has Trump +8 over Biden if an election was held today.

Rasmussen has Trump +13 (45%-32%) vs. Biden right now.

Is this because Trump has gotten more popular?


It is an indication of how Biden has become so unpopular.

Covid Continues to Confound

I have spent the better part of the last two years raising questions about what the "experts" were telling us about Covid.

Covid has confounded me at times as it has everyone. However, I believe I have been correct in my assessments a much higher percentage of the time than have the "experts" who want you to believe they know all the answers.

For example, a month ago the CDC was predicting that Covid cases would continue to decline nationally in November. Undoubtedly, the CDC was putting a lot of confidence in the vaccines to make that projection.

Even the The New York Times admitted this week how wrong those models are turning out to be. (From New York Times This Morning, November 23, 2021).

A month ago, Covid-19 cases had begun to rise in a few parts of New England and the Mountain West. But they were still falling in most northern parts of the U.S., as well as in Canada.

That pattern seemed to suggest that a nationwide cold-weather Covid surge was unlikely anytime soon. The prediction models collected by the C.D.C. agreed: They projected continuing declines in U.S. Covid cases during November.

Instead, cases have surged about 30 percent this month. 

It's a maddening development.


It certainly is a maddening development when you told everyone that the vaccines were the passports to freedom, safety and security. 

Here is what I wrote after assessing the data I was seeing heading into November.

A big reason the national numbers have come down recently is that there are few big population centers in the Upper Midwest states compared to the Sunbelt.

However, what happens when Covid challenges Chicago, Detroit, Cleveland, Philadelphia and Boston and other large population centers in the coming months?

Based on what I have seen previously, I am not confident the vaccines are up to the task. I hope I am wrong.

Look at the 14-day case increases in the states of the cities I referenced above that I was concerned about but which the CDC was predicting declines in November.

Illinois               +50%.   (61% of entire population fully vaccinated)

Michigan           +88%.   (54%)

Ohio                   +34%.  (53%)

Pennsylvania.    +43%.   (58%)

Massachusetts   +77%.   (71%)

Two other states that are seeing the highest increase in cases right now are Connecticut (+108%) and Rhode Island (+66%). 72% of every man, woman and child in these state is fully vaccinated. They are tied for second behind Vermont (73%) as the most vaccinated states.

What is astonishing to me is that it has taken so long for The New York Times and others (CDC?) to recognize the strong influence of seasonality on Covid transmission. I was writing about this relationship 18 months ago with the data I was seeing in South America.

Looking at the data from Europe also continues to raise questions about the efficacy of the vaccines and the use of mask mandates, lockdowns and other public health interventions on ending the pandemic.

The European Union currently has more confirmed cases of Covid than they have ever had.

This is with 77% of the age 18+ population and 66% of the total population fully vaccinated this year compared to 0% last year.

Deaths right now are about 1/2 of last year's peak which could be attributable to the vaccines. However, deaths lag cases and both are still rising right now.

Is this anywhere close to what was promised when the vaccine program began?

To be truly confounded look at what is occurring in South Korea right now.

South Korea has been hailed throughout the pandemic as having one of the best public health responses in the world to Covid.

It also has one of the highest vaccination rates in the world.

79% of the total population is fully vaccinated.

How is that working out right now?

Confirmed Covid cases in South Korea.

Confirmed Covid cases in South Korea

Covid deaths in South Korea.

Confirmed Covid deaths in South Korea

Yes, South Korea is still doing better than most of the world regarding Covid.

Deaths are about half the World rate and one-fifth of the United States right now.

However, put the narrative aside about the vaccines and everything else we hear about Covid and assume you just landed from Mars and were asked to look at all of the data above and assess whether it is working.

What would your conclusion be?

Are we at the point of asking the question as to whether all of the public health interventions have actually made the pandemic last longer and has resulted in more adverse effects than if we had done nothing more than protect the vulnerable?

Strategic Petroleum Reserve

Did you notice what happened to the price of crude oil after Joe Biden announced he was tapping the Strategy Petroleum Reserve in order to lower gas prices?

It immediately rose from around $75.50 to $78.50 per barrel before settling down a little over $78 per barrel.

A major reason for the increase is that oil traders know that the oil will need to be replaced in the SPR and this demand will affect future prices.

President Donald Trump had the foresight to state that he wanted to fill the SPR to the very top at the beginning of the pandemic to take advantage of the low prices of crude oil.



Congress would not agree to fund that purchase. 

They were more focused on appropriating money for ventilators at the time that ending up not being used.

Crude oil was around $20 per barrel in March-April, 2020. The average cost of oil in the SPR right now is $29.70 per barrel.

When Biden's actions are all said and done it is unlikely that the oil release will have any real impact on consumer prices.

We are talking about a release of oil from the SPR equal to 3 days of demand. As I said in my last post, this is akin to spitting in Boston Harbor.

After which, the Strategic Petroleum Reserve will need to replenish its reserves with $70-$80 oil in case of a real emergency due to issues of supply.

All the while no one remembers or mentions that Donald Trump wanted to buy oil at $20 or below.

If you recall, there was even a period in mid-April, 2020 that the price of oil went negative because there was no place to store it. Oil producers were actually paying purchasers to take the product. 

There was one place that had storage capacity---the Strategic Petroleum Reserve.


There are a lot of things that make you go hmmmm these days!

Tuesday, November 23, 2021

Lessons From Boston Harbor and Beyond

The Pilgrims arrived at Cape Cod in what is now Massachusetts 401 years ago this November. After spending over a month scouting various potential locations for their settlement they chose Plymouth.

Ten years later another group of Puritan colonists arrived in North America and settled in what is now Boston, Massachusetts in 1630.

I recently came across a map that compares the Boston shoreline of 1630 with what it is today.

The dark green is the shoreline as it existed 400 years ago.

The light green is the the shoreline in recent days.


Do you notice anything?

The shoreline of Boston extends much further out into the ocean today than it did 400 years ago.

In fact, the site of the Boston Tea Party that took place on a ship in Boston Harbor at Griffin's Wharf in 1773 is actually about 1/3 mile inland today.

The arrow on the map below shows the approximate location of where Griffin's Wharf was at that time. 


How could this be?

In 1630 there were almost zero carbon emissions caused by man beyond fires burning wood.

Coal had been discovered but it was rarely used because of difficulties in mining it.

The first modern oil well was not drilled until 1859.

It is estimated that only 500 million human beings populated the earth in 1630.

By contrast, 7.9 billion people inhabit the earth today.

We are told that the use of fossil fuels by humans is resulting in carbon emissions that are causing climate change that will cause catastrophic warming that will melt the ice caps and raise sea levels around the world.

If that is true how is it that the addition of 7.5 billion humans beings and ever increasing carbon emissions over the last 400 years has not already put Boston under water?

Growth in Carbon Emissions From Fossil Fuels Since 1750

Doesn't it seem logical that if human-caused carbon emissions were going to cause rising sea levels it would have occurred a long time ago?

Why does it always seem to be something that is going to happen in another ten years if we don't do something now?

It is true that the expanded shoreline in Boston that has evolved over the last 400 years has not been caused by receding sea levels.

It has been the result of human activity by which the shoreline has been extended outwards into Boston Harbor by the use of landfill.

The Back Bay area of Boston was literally a bay until it was decided to fill it in beginning in 1856.

By the 1800′s, the success of Boston’s shipping and manufacturing industries had led to intense overcrowding. Developers looked toward the Back Bay

.In 1856, the Commonwealth of Massachusetts decided to fill in the Back Bay and to construct a new neighborhood on top of the wasteland. By using new steam engine technology, land was hauled in from Needham, 25 miles outside of Boston.   After nearly 25 years of construction, the entire Back Bay was filled in, from the Public Garden to Kenmore Square.


Isn't that interesting?

Much of what we know of as Boston today would be under water if not for human activity and the use of technology powered by fossil fuels.

I can assure you that Boston Harbor would never have been filled in if it was going to require pitchforks, shovels and muscle power.

Consider this chart that shows how the shares of different forms of energy consumption have changed since 1860 when Back Bay in Boston was being filled in.

It shows a massive increase in the use of fossil fuels over that time. However, even the man-made landfills into Boston Harbor have not been swamped by the sea after over 150 years.

The reality in the world we live in today is that fossil fuels make up close to 85% of energy consumption. Nuclear is 4%.

Wind, hydropower, solar, biofuels and other renewables make up barely over 10% of what is powering the world right now. This is what the liberals believe we must power the world with within a decade or so to avoid having the world end as we know it.

The exact opposite is true. The world as we know it is going to end if we foolishly abandon available and affordable energy based on unproven models and dreams.

I am old enough to remember when many of the same "authorities" who are talking about global warming today were saying almost exactly the opposite 40 years ago.

By the way, 3.4 billion people have been added to the world population since this was written.


Energy makes the world economy go. We need it for anything we want to do. It needs to be available and it needs to be affordable. The economy does not work without energy. The consumer cannot spend on other things in the economy if they are spending excessive amounts on energy. If the consumer doesn't spend, the economy does not grow. If the economy does not grow, more and more people go without jobs.

If you doubt there is a relationship between affordable, available energy and economic growth consider this chart that compares world GDP growth with energy consumption growth. 

Could there be a better correlation?

This chart was produced by climate scientist Mike Haseler. Haseler points out that this relationship exists because GDP is the sum total of what humans produce. When muscle power was the prime energy source in the world we could produce very little. Firewood and domesticated animals improved our ability to produce. However, the introduction of energy sources like coal, oil and gas allowed us to greatly leverage our productive capacity. Compare the dramatic increase in GDP beginning around 1950 with the great increase in fossil fuels beginning at the same time in the charts above.

I am all for developing newer and more sustainable sources of energy. Count me as someone who would love to see a perpetual motion machine to power everything man needs on the planet.

I have great confidence that given free market economies and human ingenuity we will find better sources of energy to power our lives. This has been proven time and time again over the course of human history.

However, we have never voluntarily abandoned something that is accessible and affordable for something that is speculative and expensive as the global elites and Democrats want us to do.

We are already seeing the effects of this in November, 2021 after an election one year ago that put people in power who believe that humans are the problem on earth rather than the solution.

A year ago the United States was a net exporter of oil. It was the first time the United States had been in that position in the over 75 years when records were first maintained.

It is truly amazing what shutting down oil and gas pipelines, demonizing oil companies and threatening to jail the executives of these companies will do in such a short time.


We are now begging OPEC to pump more oil and are raiding the Strategic Petroleum Reserve which was created in 1975 in the event of oil supply disruptions that could endanger our national security and economy.


The Strategic Petroleum Reserve has generally only been accessed in the past because of supply disruptions in the aftermath of hurricanes in the Gulf Coast region (Hurricane Ivan, Katrina) or when Operation Desert Shield and Desert Storm were being conducted in the Middle East in the early 1990's.

It was not meant to be used as a tool to reduce prices and counteract poor Presidential approval ratings.

50 million barrels of oil will be released under the Presidential order. That is the largest drawdown ever of our strategic oil reserves. If you doubt whether this is just more theatrics from Biden, consider that is about a 3-day supply for the United States (about 18 million barrels of oil are consumed per day per the Energy Department). It is like spitting in Boston Harbor.

You also now know more than Energy Secretary Jennifer Granholm who was asked on Tuesday how much oil the U.S. consumes per day.

She did not know.

These are the people in charge?

Even if we assume that climate change may result in rising sea levels I am confident that human ingenuity and innovation will find a way to deal with the problem.

Look no further than the map at the top of this blog post to see what humans can do when they want to do something.

In fact, humans are the ULTIMATE RESOURCE on the planet.

I wrote about this a couple of years ago and the work of Julian Simon who wrote a book by that name in 1981.

Simon argued that population growth is actually the solution to resource scarcities and environmental problems since people and markets innovate and solve problems. 

That was a very contrarian position at the time because severe shortages in the coming years were predicted in oil, copper, food and everything else. The view was that unless population growth was immediately halted around the world people would starve and would die the from elements due to lack of food and other resources (see the Chicago Tribune article above from 1981).

Simon made a wager in 1980 with the leading doomsayer in the media at the time, Paul Ehrlich, on whether the price of five key metals would increase in price over the next decade. Simon said that costs would come down and was willing to put money on his prediction.

NPR did a story on the bet a few years ago.

Simon proposed that they bet on what would happen to the price of five metals — copper, chromium, nickel, tin and tungsten — over a decade.

And the logic was that these metals were essential for all kinds of stuff — electronics, cars, buildings. So, if Ehrlich was right, more people on the planet would mean we would start running out of stuff, and the price of these things should go up.

But, if Simon was right, the markets and human ingenuity would sort things out, and the prices would stay the same or even go down.

Those next 10 years, from 1980 to 1990, crept by. The world population grew by 800 million people. Then it was 1990. And they tallied it up. Simon, the economist, decisively won. Prices for the five metals went down by an average of 50 percent.

One of the reasons the prices dropped was just what Simon said. The catastrophe Ehrlich was predicting just did not happen. People invented substitutes, like companies switching from aluminum to plastic for packaging.

Human ingenuity and innovation also brought about new technologies and methods to extract more key metals and grow more food.

The Cato Institute recently updated the Simon story using a longer timeframe-1960 to 2016. It also looked at many more commodity items.

What did they find?

Despite the fact that the population had increased by more than 145% over those 56 years, inflation-adjusted GDP had increased by 183%. In other words, incomes grew 26% faster than population, just as Simon predicted it would due to human ingenuity and innovation.

In addition, even though there were more people, they were richer, and they consumed much more. Despite this, prices on almost all commodities fell relative to income growth adjusted for inflation.

The ultimate resource has solved many problems and improved life for humans on this earth.

There is no reason that should not continue forever.

History has shown that the only thing that can keep the ultimate resource from achieving that is when government starts to interfere in significant ways. Look at North Korea and Venezuela as prime examples.

We are living in such a time right now.

All of this may be interesting food for thought over your Thanksgiving dinner with any relatives who believe the climate change narrative.

Unfortunately, that narrative does not withstand consideration of the most basic rules of logic, the lessons of history or the ingenuity of mankind.

You now have the necessary resources to carry on that conversation if you dare.

Happy Thanksgiving to all of my BeeLine readers.

Monday, November 22, 2021

Sausage and Baloney

The U.S. House of Representatives passed Joe Biden's "Build Back Better" bill by a vote of 220-213 last Friday.

Every vote for the bill was from a Democrat.

The 213 no votes included every Republican in the House and one Democrat, Rep. Jared Golden of Maine.

So much for the bipartisanship that Joe Biden said he was going to bring to Washington.

I also assume that Rep. Golden should not expect an invitation to Nancy Pelosi's Christmas party this year.

The contents of this bill were first included in what was described as Biden's infrastructure proposal for the country.

It seems that funding "infrastructure" must poll well when voter preferences are surveyed.

When it was pointed out that spending money on child care credits, free college, housing and health care subsidies did not meet the definition of what most people considered to be infrastructure, the original proposal was bifurcated into two bills. The provisions that were generally considered to be closer to real infrastructure (roads, bridges etc) were included in a separate $1.2 trillion bill passed both houses of Congress and has been signed in to law. 

Although the contents of the remaining elements of the original proposal were almost exclusively meant to expand social spending and the Green New deal agenda of leftist Democrats, it was rebranded as "human infrastructure" before they settled on "Build Back Better".

Even to the end, the branding effort of the Democrats to make the measure appealing to voters is not over.

As the bill moves to the Senate it appears that the bill is going to be championed as legislation that would help "fight inflation" and lower costs for families.


Here is Biden's Treasury Secretary, Janet Yellen, claiming that all of this additional federal spending will be anti-inflationary.


This is the same Janet Yellen, the former Federal Reserve Chairman, who said as recently as February, 2020 that the United States was on a "completely unsustainable" debt path.

Since that time Congress has passed about $7 trillion in Covid relief spending combined with the recent infrastructure bill before getting to the "Build Back Better"bill. Janet Yellen apparently hasn't  noticed it all.

Build Back Better is also the bill that Joe Biden and the Democrats have spent two months telling the American people would cost nothing.

Bear in mind that Biden said this when the top line cost of the proposed bill was $3.5 trillion before Democrat Senators Joe Manchin and Kirsten Sinema stated they would not vote for such as high-priced bill in the Senate.

The final top line cost of the bill passed last week was $1.75 trillion.

Does that mean that the bill actually saves us $1.75 trillion now?

Of course, bills like this are always meant to increase federal spending and foster greater dependence on government to supply more and more "needs" of the citizenry.

That requires the federal government to target certain other groups within the nation to pay for what they are promising in order to  prevent even more federal debt piling up.

This bill contains a number of provisions that raise revenues by imposing higher taxes on large corporations and high income individuals.

Of course, it is not enough to equal $1.75 trillion dollars. It is never enough. It will never be enough.

That is true even when part of the revenue is supposed to come from stronger enforcement measures by the IRS.

The bill provides an additional $88 billion in funding to the IRS over the next 10 years (an increase in its budget by nearly 70%) that the White House says will produce $400 billion in new revenue. That is the largest single "revenue" source in the bill. That additional spending will allow the IRS payroll to increase by 87,000 employees.

Independent analysts state they will be lucky to garner half of that $400 billion sum from stronger enforcement.

The Congressional Budget Office (the official source) estimates that $88 billion of enforcement costs will only bring in $207 billion. However, projecting revenues from future IRS enforcement is a fool's errand. For that reason, the CBO's official estimates do not include anything coming in from the additional enforcement,

The CBO final estimate is that the bill will add $367 billion to the deficit over the next 10 years. That is a long way from ZERO.

You begin to understand how distorted the IRS enforcement measure is, and the additional impacts it will have on our economy, when you consider this analysis from the Heritage Foundation that puts the numbers in context.

In other words, under the left’s plan, for each additional $1 the IRS receives for enforcement, it may extract an additional $3 from American taxpayers. That’s extremely inefficient.

Imagine if the IRS spent $1 for each $3 of revenue it currently collects. The IRS would consume one-third of the federal budget, well over $1 trillion per year.

By contrast, the IRS now claims it spends, on average, just over $1 per $300 it collects. On the margins, the new enforcement dollars in the House plan would be spent about 99% less efficiently than the IRS’ current budget.

Presumably, the IRS would attract most of the estimated 87,000 new IRS employees from elsewhere in the labor force. It’s hard to justify draining other employers’ talent pool for such bureaucratic waste.

The bloated enforcement apparatus of the IRS would require Americans to deal with more audits, keep even more comprehensive records, spend more on accounting fees, and may make taxpayers hesitant to claim legitimate deductions and credits for fear of triggering an audit.

In an analysis of a similar proposal in the president’s 2022 budget, the Congressional Budget Office stated that audit rates would increase for all taxpayers, not just higher-income taxpayers. The analysis also noted that some audits would likely be directed at taxpayers who are compliant and owe no additional tax. 

It is also important to remember that the CBO estimates of the bill's costs do not consider any dynamic revenue or cost effects. What are the secondary and tertiary effects on what the bill does to GDP, economic growth, employment and the like?

The Tax Foundation has modeled these effects and estimates that if the bill is enacted it would reduce long term GDP, wages and employment.

In other words, this bill does not build---it subtracts.


What are we getting in return for more IRS audits, lower GDP, wages and jobs?

Here are the highlights on where the money is being spent.

Climate Change---$555 billion

Subsidies for everything under the sun that are not fossil fuel related. Subsidies for electric cars, solar panels and "creation of a Civilian Climate Corps that would provide some 300,000 jobs to restore forests and wetlands and guard against the effects of rising temperatures".

There is even $2.5 billion in the bill for "tree equity".

Universal Pre-K and Child Care---$400 billion

Under the universal preschool plan, parents will be able to send their children to a public school or childcare program of their choice.

Families that earn less than $300,000 annually, for instance, will pay no more than 7% of their income on child care for kids under age six, according to the bill.

Child Tax Credits--$200 billion 

A one-year extension of the current Covid stimulus program that grants a refundable tax credit paid monthly equal to $300 every month per child under age six and $250 every month per child ages six to 17.

For example, a family with three children, one under six and two over that age, would receive almost $10,000 in cash paid in monthly installments, even if they owed no income taxes. This is already occurring in 2021 due to Covid relief. It will continue for 2022. The Democrats want this to be permanent at $200 billion per year it carries a steep cost.

4 Weeks of Paid Family and Medical Leave--$200 billion 

A permanent, comprehensive national paid leave program that gives employed workers—including those who are self-employed—four weeks of paid family and medical leave, which can be used for caregiving or personal illness.

Health Care spending--$165 billion 

Primarily increase subsidies for Obamacare plans.

I thought Obamacare was going to make health care more affordable. Why the need for more subsidies?

Expand affordable home care for Seniors--$150 billion 

Don't get excited. It is limited to those on Medicaid who have no other assets and are on state waiting lists to get into nursing homes.

Affordable housing subsidies--$150 billion 

I guess this is what you need to do when you print money, house prices surge and leave millions of people such that they cannot afford housing.

In a liberal mind all of these are wonderful things to provide. They seem to think the government should pay for everything anyone needs. Housing. Food. Child Care. Education. Healthcare.

However, we are talking about a nation that is already $29 trillion in debt.

That is equal to about $230,000 per taxpayer.

How much can we pile on top of the wagon that those taxpayers are pulling until it breaks down totally?

What is interesting that in a bill that is supposed to "make the rich pay their fair share" the second largest cost in the bill is an increase in the state and local tax deduction limit from $10,000 per year to $80,000 over the next five years.

This is from a Washington Post story on the so-called SALT provision.

It’s the second-most expensive item in the legislation over the next five years, more costly than establishing a paid family and medical leave program, and nearly twice as expensive as funding home-medical services for the elderly and disabled, according to an analysis by the Committee for a Responsible Federal Budget.


This provision provides the average taxpayer with a $20 per year benefit according to an analysis by the Committee for a Responsible Budget. For the average household making $1 million per year, this provision would mean a tax cut of $25,900 according to the analysis. 70% of the benefit would go to taxpayers in the top 5% of earners.

The SALT provision was required in the bill because Democrats in high tax states such as New York, New Jersey and California demanded its inclusion or they would not vote for the bill.

They defend the provision because they say not allowing the state and local deductions result in unfair double-taxation.“Since it was implemented in the 2017 Republican tax hike bill, the cap has unfairly double-taxed families across the country and worked to defund our states’ critical priorities,” said Reps. Bill Pascrell, Jr., D-N.J.; Tom Suozzi, D-N.Y.; Josh Gottheimer, D-N.J.; and Mikie Sherrill, D-N.J., in a joint statement.

If double-taxation is an issue I can think of a lot of other things that should be looked at.

Let's start with FICA taxes. We aren't allowed to deduct FICA taxes on our income tax return. That is double taxation.

I pay gasoline or sales tax on purchases with money earned through income that has already been taxed. That is double taxation.

Why do we have an estate tax? It is effectively a double tax on money earned while someone was living and working.

Why do we tax dividends? Those are just distributions of profits that have already been taxed at the corporation level.

If the SALT limit results in unfair double taxation all of these do as well.

I will personally benefit from the increase in the SALT limit. However, this makes no sense.

Nothing about this makes much sense.

Calling social spending infrastructure. Telling us it would cost nothing. Saying it is anti-inflationary. Taxing the rich and then giving the second largest benefits to the rich.

Someone once said that "Laws are like sausages. It is best to not see them being made."

I might add that we also should not be subjected to the baloney that comes out of the mouths of politicians to try to sell stuff like this to the voters.

Sausage and baloney.

There is a lot of it in Washington in the Biden years.

There is no free lunch.

The costs of this package of sausage and baloney is far from ZERO.