The Economics of Inflation

Inflation is not going away soon.

The new CPI number was released for August yesterday and came in at a 8.3% year over year rate.

That makes six consecutive months where the headline number has been over 8%.

The 8.3% number seemed to surprise analysts and economic observers who were anticipating a lower number.

It did not surprise BeeLine. I made this prediction about where the CPI was going in these pages last June.

At some point, we should see some moderation in the index if for no other reason than the base index gets higher with each succeeding month,

At some point the CPI number will come down. That doesn't mean current prices are going to go down.

If gas prices are the same next year that would be a 0% increase in the CPI index. Keep in mind the CPI is only measuring price changes over the last year. The base the CPI is being measured against is getting larger every month for the inflation that started just over a year ago.

Looking at the data I would expect inflation to remain at least 8% through September assuming there is not a total meltdown of the economy that will drastically cut demand pressures. 

The high inflation number apparently dashed hopes that the Federal Reserve would soon be pausing or reversing interest rate increases.

This led to a massive sell-off on Wall Street.

Source: https://www.wsj.com/livecoverage/stock-market-news-today-09-13-2022

A year ago we were told that inflation was transitory.

The same story was told by Joe Biden, Secretary of Treasury (and former Federal Reserve Chair) Janet Yellen and current Fed Chair Jerome Powell.

They obviously didn't know what they were talking about.

We then heard that all of the inflation was due to supply chain issues coming out of Covid.

Or it was Putin's fault.

However, the New York Federal Reserve recently published an analysis that showed most inflation we are seeing has been caused by DEMAND issues rather than supply issues.

Two-thirds of inflation was due to aggregate demand shock issues in the economy.

Simply stated this means too much money chasing a limited supply of goods and services.

Where did all that money come from?

This is a chart showing the growth in the money supply (M2) over the last 10 years.

I added a trend line to the FRED chart below to show how massive the increase supply in the money supply has been in the last two years.

Of course, a lot of this was done to facilitate massive government spending programs in the wake of Covid.

The Fed increased the money supply nearly 40% in less than two years.

This is the primary cause of the inflation we are seeing right now. Too much money was created chasing a limited supply of goods and services.

Students in Economics 101 learn about the effects of supply and demand on prices in the first week of class. However, that lesson appeared to have been forgotten by our economic policy makers over the last two years. 

It is interesting to consider this same concept in looking at prices and inflation in the UK and Russia right now.

Sanctions were placed on Russia by the UK, the European Union and the United States as a tool to increase pressure on Russia and attempting to influence the popular opinion of the Russian people against Putin and the Ukraine war.

Those sanctions have had the effect of reducing the supply of Western goods and services into Russia. Companies like McDonald's, Starbucks, Heineken and Coca-Cola announced they were halting business in Russia.

Many other large retail names also did the same.

Credit: https://www.thesun.co.uk/news/19698308/russia-uk-prices-sanctions-food/amp/

This reduction in supply undoubtedly made these items impossible to get or made them very expensive on the secondary market.

At the same time, the sanctions limited Russia's ability to export Russian products that might normally go to the UK and other Western countries such as vodka, caviar and other food items. This has created a greater supply of these goods to be sold to Russian consumers.

Of course, the Western countries no longer will buy Russian oil although they desperately want Russian natural gas to continue to flow to Europe to keep the lights on.

Russia has had no problems selling its oil and gas to other counties and the worldwide price of both has gone higher since the Ukraine war started insuring there is plenty of money in Putin's coffers. Russia has also been able to demand payment in Russian rubles rather than U.S. dollars (the normal form of payment) for their oil and gas. This has propped up the ruble's value in currency trading.

The end result of this is that prices of those things that people need to live day to day (food and energy) have declined or remained affordable in Russia while prices on these things in the UK and Europe are out of control.

Putin may be also be using some of the cash he is getting from oil and gas sales to subsidize the price of food and energy knowing that people are less likely to rise up when the costs of these items are stable compared to not being able to get their Starbucks coffee every day on the way to work.

This is an example of a comparison of prices between the UK and Russia as recently reported in a UK newspaper, The Sun.

Source: https://www.thesun.co.uk/news/19698308/russia-uk-prices-sanctions-food/amp/

Yet another interesting example of the forces of supply and demand on prices and inflation.

For comparison, here are a few of the price increases of individual items in the U.S. CPI index in yesterday's report over the last year.

It is the highest inflation rate for food at home (groceries) in 43 years--- +13.5%.

Bread +16.2%

Margarine. +38.3%

Eggs  +39.8%

Of particular interest, is the fact that health insurance costs are +24.3%. That is the largest yearly increase in history.

Does anyone remember Obama and Biden claiming that the "Affordable Care Act" was going to reduce health care insurance costs?

That might suggest to you how much inflation is going to be reduced by the "Inflation Reduction Act" that Biden and the Democrats celebrated yesterday on The White House lawn.

Source: https://www.foxnews.com/politics/biden-celebrates-inflation-reduction-act-inflation-rises-august

Energy +23.8% in the U.S.

It is infinitely better than Europe but is still squeezing the budgets of every American.

Of course, what comes next as Winter approaches and energy becomes an even bigger potential issue in Europe and elsewhere?

When economists want to know what comes next with consumer prices they look at producer prices.

The Producer Price Index (PPI) measures price increases that domestic producers are experiencing for their output. If their prices are increasing its means that either they will pass those costs in their prices to consumers or, if they cannot, those costs will have to be absorbed and effect the bottom line of the business. 

What is the most recent PPI number in Europe?

37.9%.  By comparison, the latest PPI number in the U.S. is 9.8% ( the August PPI number will be released this morning ((9/14/22)).

Source: https://www.investing.com/economic-calendar/ppi-935

Compare that number to the 5-year trend in Europe.

Eurozone PPI (YoY)
Source: https://www.investing.com/economic-calendar/ppi-935

The latest CPI in the Eurozone is 9.1%. That is a long way from 37.9%.

Basic economics tells us that the 9.1% is either going to go up further toward 37.9% or we will see more and more European businesses under financial stress that will result in closures, job losses and a recession, if not a depression.

One other economic reality is that supply and demand forces equalize over time.

It is the natural order unless government interferes with that process.

When demand exceeds supply, demand will eventually be diminished or destroyed, or supply will increase to meet demand.

For example, this is an interesting chart from Sweden that compares consumer confidence (potential demand) with total inventories (supply) in that country to show that process is well under way.

Central bankers like to say that when we are in times like this their goal is to bring the economy down into a soft landing.

Considering where we seem to be, those bankers need to have the skills of Pete "Maverick" Mitchell to avoid a hard landing let alone a crash from the ride they have taken us on.

This and That--September 12, 2022 Edition

A few random observations, charts and factoids to provide some context on what is going on in the world.

Climate Change

As we ponder how much stock to place in those who tell us what the climate is going to be 5, 10, 50 or 100 years out, and use it to claim we need to drastically reorder our lives today to avoid catastrophe tomorrow, we might want to consider how accurate various climate predictions have been.

This was the prediction in May for this year's hurricane season in the Atlantic.

What have we seen in hurricane activity thus far this year?

Things can yet change.

However, isn't that the real point?

The climate has always been changing and it will continue whether man is involved or not.

Could it be that climate policy is more dangerous to us than climate change?

Ask that of those in Europe right now.

Mortgage Rates

The 30-year mortgage rate in the United States hit 5.89% last week.

Last year it reached an all-time low of 2.65%.

It is now the highest it has been since November, 2008.

You can see what the combination of higher interest rates and higher home values have done to the average monthly payment of someone looking to buy a home since January, 2021.

January, 2021---$1,294.     August, 2022---$2,447

 

The chart below compares the 30-year mortgage rate (red line), one family houses monthly supply (blue line) and one family houses sold (green line).

Higher interest rates are causing pain in the real estate market.

Credit: https://twitter.com/SylvainBaude/status/1567135018505621505/photo/2

I think we can expect even more trouble ahead.

Household Net Worth

The government's Covid relief money and the Fed's accommodative money printing policies boosted the net worth of many households over the last two years.

Household and non-profit organization's net worth grew from $116 trillion at the end of 2019 to $150 trillion at the end of 2021 according to a recent report by the Federal Reserve.

That was a 29% increase in just two years.

Stock market equity gains provided $11 trillion of the $34 trillion of increased net worth.

Mutual funds provided $3 trillion.

Pensions and retirement funds added $3 trillion

Increases in household owners home equity contributed $7 trillion in added net worth. 

Though the first six months of the year about $8 trillion of the $34 trillion (approx, 25%) in increased net worth had been erased.

This was almost all centered in losses in the stock market.

None of it in was house values as of the end of the second quarter. Overall house values were still up in the second quarter in the Fed data.

Source: https://www.federalreserve.gov/releases/z1/20220909/html/recent_developments.htm

Considering the factoids above on mortgage rates and the housing market right now, you have to believe  that there is more pain to come especially when you look at how extraordinary the increases in net household net worth were in the space of a mere two years.

What goes up can come down.

Student Loans

When the Covid pandemic hit us the federal government gave those with student loans the ability to seek forbearance on payments of their student loan debt during the emergency.

Of course, this only allowed borrowers the option to not make payments if they were in financial stress.

The debt was still owed and interest continued to accrue.

If you were not in financial stress it made little economic sense to not pay because the debt would just grow larger with the interest continuing to accrue. and compound.

Of course, if someone is telling you that your student debt may be cancelled or forgiven you might stop paying merely because you might believe you are not going to have to pay in the end..

This is an interesting chart that shows that almost anyone holding student debt has not bothered to make any repayments on their student debt in the last two years.

Now that Joe Biden has actually issued an executive order to cancel up to $20,000 of student debt per person you have to wonder whether anyone will ever make a repayment again or pay for college without taking out a loan?

Isn't everyone going to be thinking that the next cancellation of student debt is just another election away?

Vacation Time

In that there are so many problems in the United States and the world it is comforting that Joe Biden is always on the job and laser-focused on what needs to be done.

Never mind.

Living In A Sane World?

If you were dying of thirst in a desert and came upon a beautiful fresh water stream would you pass it by because it was not filtered water?

If you were a vegetarian and had not eaten for three days would you reject a hamburger that was offered to you?

This political cartoonist had another take with the same theme.

These are a few examples that come to mind as I try to process in my mind the apparent insanity that has taken hold in Germany and California.

I don't know any other way to describe the energy policies they are are following.

Germany's entire economy and society is on the brink of collapse due to high energy costs.

Last year Germany had announced plans to close its three remaining nuclear power plants by the end of this year.

In a sane world, you would think that Germany would reverse that policy and keep those nuclear plants running and generating electricity in light of its current energy challenges.

However, German Chancellor Olaf Scholz stated this weeky that Germany will not reverse course on that decision.

Source: https://www.theguardian.com/world/2022/sep/07/german-chancellor-rejects-calls-to-reverse-nuclear-power-plants-closure

The German chancellor, Olaf Scholz, has rejected calls for his government to commit to a longer-term extension of the life of the country’s nuclear power plants and insisted that Europe’s largest economy would have enough energy to get through the winter.

Perhaps they will have enough energy to get through the winter but at what cost?

Citizen protests are ramping up regarding the surging energy costs.

Something has to give.

German households cannot afford to pay energy costs that are many multiples of what they have been paying.

German businesses and industries simply cannot survive energy costs and keep producing at the recent levels for very long without going bankrupt.

Steel. Auto manufacturing. Chemicals. There is no future in Germany for these industries with these exorbitant energy price in their cost structures. 

Keep an eye of Germany. I don't know where it is headed but it cannot be good.

The UK seems to be more in touch with reality.

New Prime Minister Liz Truss announced yesterday that the UK is cancelling the nation's moratorium on fracking.

It is not the first time in history that the UK has been sane and Germany insane.

In the meantime, what is happening in California?

California is the state that two weeks ago announced new rules that would totally ban the sale of new gasoline-powered vehicles in the state by 2035. The 100% ban is being phased in over the next 13 years.

By the end of this decade, California is requiring that 68% of new vehicles sold in the state must be zero-emissions. That is just 8 years away.

Zero emission new car sales were 12% in 2021.

Source: https://www.cnbc.com/2022/08/25/california-bans-the-sale-of-new-gas-powered-cars-by-2035.html

Less than a week later California was telling electric car owners to not charge their vehicles because of too much strain on the electric grid due to a heat wave.

Source: https://www.newsweek.com/californians-told-not-charge-electric-cars-gas-car-sales-ban-1738398

If California is telling electric car owners to not charge their cars now what is going to happen in 2026 or 2030, let alone 2035?

Does anyone know how long it takes to plan, get the permits and construct a new electric power generation plant? If you start now you might have something in 7-10 years if you are lucky.

Even if the electricity is generated it has to be interconnected to the electric grid and that has proven to be a major problem in California and elsewhere due to permit and bureaucracy delays. It currently takes 2.5 to 3 years just to move from an interconnection request to a connection agreement for most solar projects in the United States.

If you rely on solar energy there is also the problem of storing that power when the sun goes down. This requires the installation of gigantic and expensive reserve battery systems that can store the power until it is needed.

California has become increasingly reliant on solar power for its energy needs.

The problem is that the supply of renewable energy is down when the sun sets but residential demand is up in the evening hours when people are in their homes. When are people charging those electric cars at home?

This graph shows where the energy sources for the power generation came from in California on September 7 in 5-minute increments.

Source: https://www.caiso.com/todaysoutlook/Pages/supply.aspx

As you can see, renewables (green line) are providing a fair amount of energy between 8 am and 6pm. It   then it drops like a rock. As a result, California is heavily reliant on natural gas (orange line) for power generation when the sun is not shining.

Notice as well that natural gas is still the predominant source of supply for power generation all day long despite the strides California has made with renewables.

It should be noted that California is also pretty heavily reliant on imported energy (red line) from other states to keep the grid going.

All of this explains why these Flex Alerts have become common in California recently. At times of high demand there will not be enough electricity for all that need it. Rolling blackouts are then required.

Most people would also be surprised to learn that California is actually producing less zero-carbon electricity today than it did a decade ago. I know I was.

That is because of the shutdown of a large nuclear plant (San Onofre) that supplied 9% of total electricity needs in 2011 and less hydro power due to continuing drought conditions in California.

Hydro in the state has dropped as a source of electricity generation from 43,000 GWh in 2011 to 15,000 GWh in 2021.

Credit: https://twitter.com/ShellenbergerMD/status/1567608757844344832

I was also surprised to learn that California is actually producing and consuming less electricity today than it did 15 years ago. Energy conservation efforts have clearly proven useful. However, what happens when all of those electric vehicles get plugged into the grid?

California has made big bets and advances in using solar and wind for power generation over the last decade.

However, despite this massive ramp up, only 16% of California's total power generation is coming from renewables today.

Source: https://www.californiadgstats.ca.gov

It also needs to be noted that renewables, whether solar, wind, or hydroelectric, are fundamentally unreliable because they depend on the weather.

California is seeing that right now as Texas did in Winter, 2021 when its wind turbines froze up in cold weather.

Therefore, any grid that relies on renewables has to build in contingency generation sources based on nuclear, natural gas or coal or risk having the grid shut down. This is evident in looking at the Supply Trend graph referenced above.

It looks like Tesla owners have had to put their own contingency plans in place in California.

Credit: https://www.instagram.com/p/CiNiwmrOzaF/?utm_source=ig_embed&ig_rid=6c9c060a-ec9d-40db-bc25-010e98361f25

As in Germany, I don't know where this goes in California.

However, something has to give.

What they are attempting to do does not compute.

All of this is being done in the name of preventing climate change.

I don't know whether climate change is a real issue or not.

Or if it is,  can it be said that man is the cause...or whether we can do anything about it in any event.

I do know that the climate has changed before and man had nothing to do with it.

Scientists say that at one time we had temperatures much higher than we have now. We then had an ice age. And then the ice melted. Some say we are just coming out of a mini-ice age that has lasted over the last couple hundred years.

We had much more severe weather conditions in the United States in the 1930's than anything we have seen recently. 

We hear predictions made about threats to our survival from climate change 10, 30, 50 or 100 years from now. That is an 'inconvenient truth" I have written about before.

Of course, I am old enough to remember similar predictions made 20 years ago that have not come to pass.

I do know that at no time in human history have we ever abandoned affordable and workable energy sources without a practical solution to replace them to meet current needs.

I also know that no civilized and moral people have ever sacrificed people based on prophecies by false gods relating to the future

I am all for developing all of the energy sources we can from both renewable and non-renewable sources.

We should exclude nothing. I would like nothing better than a perpetual motion machine that generated all the energy we needed to power the world.

Without energy the prospects of our society and world is bleak.

However, a sane society does not unilaterally disarm itself.

Are Germany and California living in a sane world? 

The Failure of Public Health

According to the World Health Organization (WHO), the goal of public health is to prevent disease, promote health, and prolong life among the population as a whole. 

The best indicator of the success of public health measures is measured by the increase in life expectancies.

Over the last century or so public health initiatives have been credited with increasing the life expectancies of U.S. citizens by over 30 years.

Life Expectancy (from birth) in the United States (1860-2020)
Source: https://www.statista.com/statistics/1040079/life-expectancy-united-states-all-time/

Much of this has been due to better sanitation practices, safer water supplies and a reduction in child mortality. 

Overall life expectancy is affected much more by deaths in the young than those who are older and closer to their life expectancies. 

In the chart above, you can see the decrease in life expectancy in the 1860-1865 period due to the Civil War.

There was also a decrease in the 1915-1920 period due to World War I and the Spanish Flu pandemic that principally affected young people.

Interestingly, overall life expectancy did not  fall during World War II and Vietnam despite the large number of deaths in young soldiers. 

As you can see from the CDC chart below, there have been more deaths from Covid in the 85+ age group than any other.

Over half of the deaths are in those over age 75.

Three-fourths of Covid deaths have been among those age 65 or older.

Source: https://covid.cdc.gov/covid-data-tracker/#demographics

You can see that Covid deaths for anyone below age 30 is almost invisible on the chart.

In 2019, the average life expectancy in the United States was nearly79.

By the end of 2021, it was 76.

That is the largest drop in life expectancy in over 100 years.

Source: https://boingboing.net/2022/08/31/us-life-expectancy-continues-to-fall-in-a-historic-drop.html

From a New York Times story on this data.

In 2021, the average American could expect to live until the age of 76, federal health researchers reported on Wednesday. The figure represents a loss of almost three years since 2019, when Americans could expect to live, on average, nearly 79 years.

In 2021, the shortening of life span was more pronounced among white Americans than among Black Americans, who saw greater reductions in the first year of the pandemic.

There is no question that Covid deaths had an effect on the drop in life expectancy.

However, deaths among people around the life expectancy numbers should not materially decrease the average number by 2-3 years over the course of a couple years.

That can only occur when there are a number of deaths of individuals at ages well below the life expectancy average. This is what occurred in the Civil War, World War I and Spanish Flu pandemic. We can see from the CDC data above that there have been very few deaths among those below age 50 from Covid.

What then has caused the overall life expectancy to drop so dramatically in a couple of years?

The CDC has done an analysis for 2020 and 2021 in which it attributed cause-specific death rates and their effects on life expectancy.

A large negative number means that cause of death had a significant effect on lowering overall life expectancy in that period. A high positive number indicates that this cause of death was actually less prevalent between the two years and had the effect of increasing overall life expectancy.

Between 2019 and 2020, the CDC attributed 74% of the decrease factors lowering overall life expectancy as being due to Covid. However, this was offset by much fewer deaths than expected from Cancer (46% of the positive contribution) and Chronic Lower Respiratory Disease (CLRD) (21%).

Source: https://www.cdc.gov/nchs/data/vsrr/vsrr015-508.pdf

Does it make sense that cancer and CLRD deaths could drop that much in a year to positively effect life expectancy?

Were some of what would normally have been classified as cancer or CLRD deaths called Covid deaths?

Were some of these conditions simply missed in 2020 because of lockdowns?

The data comparing the loss of one year of overall life expectancy between 2020 and 2021 is particularly interesting.

Bear in mind this is after a year of Covid lockdowns and an aggressive Covid vaccination effort that continued throughout 2021 

Source: https://www.cdc.gov/nchs/data/vsrr/vsrr023.pdf

The CDC attributes only half of the decrease in life expectancy reductions to Covid.

Unintentional injuries (drug overdoses, accidents, drownings, etc) caused 16% of the reduction.

A massive 25% is due to Residual causes that do not fit into an easy category. In the previous year, Residual was only 7%.

As to positive effects on life expectancy, it appears that deaths from influenza and pneumonia fell off a cliff in 2021.

Did what were previously flu and pneumonia deaths just become Covid deaths in 2021?

For the second consecutive year we also saw a reduction in Respiratory deaths. Did those deaths also end up classified as Covid deaths?

Deaths from Alzheimer's deaths also fell. Why would these deaths fall so dramatically in one year? Did some of these deaths also get counted as Covid deaths?

With so many deaths in the Residual category that resulted in deaths that lowered overall life expectancy, is it possible that the vaccines might be responsible for causing excess deaths (especially in younger age groups below age 65)?

I don't know the answer to these questions.

The only thing I know for sure is that the dramatic decrease in life expectancy is a massive indictment of the public health establishment.

Dealing with Covid is one thing.

However, the total focus on Covid to the exclusion of all other possible public health implications was totally irresponsible.

We are now seeing the full effects of that tunnel vision.

Medical conditions worsened by delayed treatment. Mental health conditions. Drug overdoses. Suicides. Homicides. Possible adverse effects from the vaccines.

Add to this what we are finding out about the damage done to schoolchildren due to the school closures.

Source: https://www.nytimes.com/2022/09/01/us/national-test-scores-math-reading-pandemic.html

Of course, many are now saying none of these effects were foreseeable.

Who could have known?

I warned about those possible implications in these pages on April 12, 2020. 

I was concerned that Dr. Fauci and others were not considering the longer-term effects of what the lockdowns would have on the economy and other factors affecting public health.

I also have a hard time in understanding how Dr. Fauci can stand up at those press conferences and say that his sole focus is on health recommendations to the President. He is being charged with overseeing the public health of the United States. Yes, that includes the nation's short term response to the virus. However, how do public health concerns also not extend to the longer term implications of the economic shutdown.

He says he is not an economist. In my view, it is not enough for him to say that it is not his concern. There is a public health component in that as well that he should be considering and weighing in his recommendations.

In May of 2020 I also wrote that the risks to children were much greater in not being in the classroom than any risks that they had from Covid.

I expressed my concern as to what this was going to do to those children who were already behind in educational skills, especially those from minority and low-income communities.

These children were already seriously behind before we stopped them from attending in-person classes. 

Did these children even have a laptop and internet connection to attend school? Did they have any type of parental support at home to supervise and support their online learning? 

It all looked like a looming disaster to me.

Of course, most of the teacher's unions (with the support of the public health establishment) lobbied to keep the schools closed to in-person instruction.

The failure of public health over the last 2-1/2 years is unprecedented in human history.

The actions of our public health authorities borders on gross negligence.

Look no further than the life expectancy numbers.

If it was not bad enough that they got almost everything wrong in their Covid response.

In the process, those errors were then compounded by making a whole lot of other issues worse as well.

Will anyone be held accountable?

Is anyone in the public bureaucracy ever held accountable?

Dark and Divisive

I don't know if there has ever been a darker and more divisive speech given by an occupant of The White House than Joe Biden's tv address at Independence Hall in Philadelphia last week.

For example, I don't know which of Biden's advisors thought that the stagecraft for the speech was a good idea.

It took a lot of work to make Independence Hall look like a sinister backdrop for a movie about an aging tyrant and a dystopian society.

If you doubt that compare the image above to a photo I took of Independence Hall when I was in Philadelphia several years ago.

This is Joe Biden in November, 2020.

There is nothing in the words in the speech that suggest uniting anything.

Or working with all his heart to win the confidence of the whole people.

Too much of what’s happening in our country today is not normal.

Donald Trump and the MAGA Republicans represent an extremism that threatens the very foundations of our republic.

... the Republican Party today is dominated, driven, and intimidated by Donald Trump and the MAGA Republicans, and that is a threat to this country.

And here, in my view, is what is true: MAGA Republicans do not respect the Constitution.  They do not believe in the rule of law.  They do not recognize the will of the people. 

They promote authoritarian leaders, and they fan the flames of political violence that are a threat to our personal rights, to the pursuit of justice, to the rule of law, to the very soul of this country. 

MAGA Republicans have made their choice.  They embrace anger.  They thrive on chaos.  They live not in the light of truth but in the shadow of lies.

The MAGA Republicans believe that for them to succeed, everyone else has to fail.  

There are far more Americans — far more Americans from every — from every background and belief who reject the extreme MAGA ideology than those that accept it.  

By comparison, consider the words of Abraham Lincoln in his first Inaugural Address in 1861.

Lincoln knew that people in the South did not accept his election.

By the time of his inauguration on March 4, 1861, seven states had already announced their intent to secede from the Union because they believed that their way of life was under assault with Lincoln's election. 

Lincoln knew that more of the Southern states were close to seceding including Virginia, Arkansas, North Carolina and Tennessee.

Did he attack the Confederates and call them extremists, enemies or semi-fascists? 

No.

He made it clear that he was not their enemy and had no intent on enforcing anything on them.

In fact, Lincoln said this in that speech.

Apprehension seems to exist among the people of the Southern States that by the accession of a Republican Administration their property and their peace and personal security are to be endangered. There has never been any reasonable cause for such apprehension. Indeed, the most ample evidence to the contrary has all the while existed and been open to their inspection. It is found in nearly all the published speeches of him who now addresses you. I do but quote from one of those speeches when I declare that--

I have no purpose, directly or indirectly, to interfere with the institution of slavery in the States where it exists. I believe I have no lawful right to do so, and I have no inclination to do so.

Lincoln said his only duty was to uphold the Constitution and "to preserve, protect and defend it" and to see to it that the United States of America endured as a nation.

He does not refer to those who are speaking of real insurrection and secession against the United States as extremists or enemies.

Lincoln calls those who were threatening real insurrection and secession his fellow countrymen and friends. 

He concluded his speech with these words.

In your hands, my dissatisfied fellow-countrymen, and not in mine, is the momentous issue of civil war. The Government will not assail you. You can have no conflict without being yourselves the aggressors. You have no oath registered in heaven to destroy the Government, while I shall have the most solemn one to "preserve, protect, and defend it."

I am loath to close. We are not enemies, but friends. We must not be enemies. Though passion may have strained it must not break our bonds of affection. The mystic chords of memory, stretching from every battlefield and patriot grave to every living heart and hearthstone all over this broad land, will yet swell the chorus of the Union, when again touched, as surely they will be, by the better angels of our nature. 

Could there be a bigger contrast? 

Lincoln was facing a situation in which the "very foundations of our republic" were not merely under threat. Those foundations had already been forcefully attacked through secession by seven states.

However, there was no talk of enemies or anger or chaos like Biden did. Lincoln reminded everyone of our "bonds of affection" and "the better angels of our nature."

Biden also spent a good portion of his speech talking about democracy.

For example, he said this.

Democracy cannot survive when one side believes there are only two outcomes to an election: either they win or they were cheated.  And that’s where MAGA Republicans are today.

Biden apparently forgot about Hillary Clinton and the Democrats being in the same place for the entire four years of the Trump presidency.

Biden also said this.

American democracy only works only if we choose to respect the rule of law and the institutions that were set up in this chamber behind me, only if we respect our legitimate political differences.

Respect the rule of law?

Is Biden respecting the rule of law when it comes to immigration?

Is Biden respecting the rule of law and our institutions when he unilaterally is cancelling student loan debt by executive order without an act of Congress?

How much respect has Biden shown to legitimate political differences on some of these issues?

Abortion? 

The Second Amendment?

Covid policy?

We now know that the Biden administration actively worked with social media giants like Facebook and Twitter to censor opposing opinions on Covid policy.

Source: https://www.theepochtimes.com/over-50-biden-administration-employees-12-us-agencies-involved-in-social-media-censorship-push-documents_4704349.html

We know that the FBI labeled parents of schoolchildren who challenged school board members on school closures and the teaching of critical race theory as domestic terrorists.

How does any of this show respect?

How does any of this make sense when viewed in the context of reality as this political cartoon puts into perspective?

At its essence, the Biden speech was a political speech meant to rally the Democrat base and attempt to sway Independent voters to not believe the reality of everything they see around them that has gone to hell over the last two years---inflation, gas prices, utility costs, Covid policy failures, Afghanistan failure, the Russia-Ukraine war and all the rest.

Joe Biden does understand one basic truth about the American system.

The American people have the power to decide how they want to be governed.

Too often the people themselves do not understand how powerful that right is.

Biden and the Democrats have to be terrified of what they see in the 2022 mid-term polls.

For example, a poll in Pennsylvania last week showed that Trump would beat Biden by 7 points in an election matchup in that state right now.

Source: https://creativedestructionmedia.com/news/politics/2022/09/02/cd-media-big-data-poll-trump-leads-biden-by-7-points-in-pennsylvania/

Trump is running ahead of both the Republican candidate for Governor and the U.S. Senate who are both losing to the Democrats in that same poll.

The same is true in Georgia. Trump is outpolling both Herschel Walker in the Senate race and Brian Kemp in the Governor's race.

Recall that Trump lost both Pennsylvania and Georgia in the 2020 election.

Are Trump MAGA Republicans really the fringe extremists that Biden is seeking to portray them as?

What is really scaring the Democrats and Biden right now is the democracy he wants to talk about.

They are terrified that there actually might be a majority in this country who really want to Make America Great Again.

Or at least as great as America was four years ago.

Remember we were told every day back then how bad things were with Trump?

We were told how dark and divisive things were and we were living in an authoritarian state of affairs.

Now that some time has passed, is that a more accurate description of 2018 or 2022?

How voters answer that question will undoubtedly determine the mid-term election results and what comes next in the United States of America.

Ideology and Science

It seems that most everywhere you go these days more and more people have accepted the risks of Covid.

For the most part, stadiums, restaurants, bars and airplanes are full. Students are in classrooms. Fewer and fewer people are working from home.

Some still wear masks in public but it is a distinct minority (5%-10% or less) in most places I visit.

It is an interesting change in perspective even though the data shows that there are about twice as many new cases of Covid being reported now (7-day average) as there were two years ago.

Bear in mind that the 2022 numbers are undoubtedly massively understated as well due to the marked increase in self-tests that are never reported.

August 31, 2020. 

August 31, 2022

Of course, if we were to look back a year ago the reported case numbers were much worse than they are today. However, self-tests were still difficult to obtain at this time last year so it is very likely that the real 2022 number is not much different than 2021.

It is obvious that a big reason that more people have accepted the risks of Covid is that we are seeing fewer cases of severe disease, hospitalizations and deaths.

Covid hospitalizations are down over 60% since this time last year.

This is incredibly positive news that supports why people are more accepting of the risks of Covid.

I am also sure that many would point to that drop in hospitalizations between last year and this year and attribute it to the vaccines.

However, why then did hospitalizations increase almost 3-fold in 2021 (post-vaccination) compared to 2020 (pre-vaccination)?

Is it also possible that the decrease in severity of Covid is due to the fact that the virus is far less virulent today than it was previously?

Might it also be that natural immunity, given the huge numbers exposed to the virus over the last year, has provided a layer of extra protection to society?

The New York Times recently conducted a poll with the The Morning Consult that documents some of the changing personal perspectives of people concerning Covid.

What I found interesting is how much that poll reveals how sharply views about Covid are shaped by ideology...and even age.

For example, 34% of those who describe themselves as very liberal state that they see Covid as a "great personal risk."

That is a big improvement from the 47% in that group that saw it that way in March.

However, compare this group to other adult groups based on ideology.

What is also interesting is that the youngest age group (18-34), which has the lowest risk from Covid, is the group must likely to always wear a mask in public.

However, as you might expect by looking at the graph above, it is those who are "very liberal" that you can most expect to see wearing a mask (44%).

33% of Liberals always don a mask. Only 18% of those who are Very Conservative do.

Even The New York Times pointed out none of this makes sense based on the "science".

Very liberal Americans remain more worried about the virus than almost any other demographic group, including the elderly.

That pattern does not seem consistent with scientific reality, given that the very liberal are younger than any other ideological group and that Covid’s effects are far worse for older people. But the pattern may help explain why young people in our poll reported wearing masks slightly more often than older people — and why the few schools and workplaces that still have mask mandates tend to be in liberal enclaves.

I also find it interesting that we were often told that masking was not so much about your personal protection but about protecting others.

I would guess this would be the primary reason that those who are "very liberal" would give for wearing the mask. They are not doing it for themselves but for everyone else.

However, is it just a coincidence that the same group that says "Covid presents a great PERSONAL risk" to them is also the group that is masking the most?

This week the FDA provided emergency use authorizations for Pfizer and Moderna to distribute new booster shots with the stated purpose of offering better protection to the Omicron variants.

These are bivalent vaccines meaning that they are meant to target both the original Covid strain and the Omicron variant in the same dose.

These should be available for those over age 12 (Pfizer) and age 18 (Moderna) as soon as next week.

Source: https://www.fda.gov/news-events/press-announcements/coronavirus-covid-19-update-fda-authorizes-moderna-pfizer-biontech-bivalent-covid-19-vaccines-use

I think I can predict who will be first in line to take the new booster doses.

How safe and effective are the new booster doses?

Are there are risks that outweigh the benefits in taking this new booster dose?

The FDA states that they believe the benefits outweigh the risks.

However, there were a mere 800 people in each clinical trial and these people were only followed for less than two months for safety issues after being vaccinated. 

The effectiveness of the new vaccines were not even tested on humans.

I will say that again.

The new vaccine boosters have not even been tested for effectiveness in humans.

The FDA is relying on pre-clinical trials with eight mice that showed an increase in antibody levels as the basis for the claim that the vaccines are effective.

This is an excerpt of an Q&A in Mercury News on whether you should take the new booster.

(Underlines for emphasis added by BeeLine)

Q: Why is this booster being rolled out, if it hasn’t yet been proven effective in people?

A: The FDA says the shots are safe and will help fend off disease. “How confident am I?” Dr. Peter Marks, the FDA’s top vaccine regulator, said in an interview with the New York Times. “I’m extremely confident.”

In preclinical data presented by both Pfizer and Moderna to the FDA in June, the bivalent vaccine design performed better than the single-target vaccine.

In eight mice, Pfizer’s bivalent booster generated a 2.6-fold increase in neutralizing antibody levels against the BA.4 and BA.5 subvariants, compared with the companies’ current booster. Lab work by Moderna showed its new booster increased neutralizing antibodies against the new variants 8-fold, while the original booster only increased antibody levels around 4.4-fold.

The companies are now conducting clinical studies in humans. But those results probably won’t be ready until late October or early November.

In looking at the numbers above, don't you have to ask what the emergency is right now?

How is it conceivably in the public's interest to rush a vaccine to market that has not even been proven effective beyond the immune response in eight mice?

Is this what public health has become?

What other proof do you need to see that ideology drives public health policy no differently than it does anybody else.