We all know the economy is very complex and interrelated. Politicians in general don’t understand or care. Regular businesspeople grasp it much better. But even the experts can’t necessarily analyze and grasp all the moving parts at every moment in time.
That’s why the present economic outlook is difficult to pin down and with it being an election year, people want to understand better as the economic forces interact with the politics of things.
It’s bad enough when the Labor department substantially revises numbers every month for nearly two years because their model seems significantly incapable of measuring unemployment and employment numbers. That’s the corporate survey numbers. The household survey is regarded as more accurate by many experts. But it has significantly differed from the corporate survey for enough months that its accuracy is being questioned.
As for recent numbers, most of the new jobs were government jobs—again—and healthcare jobs. Some 300,000 jobs were created but the general media did not mention that 690,000 part-time jobs were also created. Question is, are those part-timers people who would like to have full-time jobs, people who only want part-time work or people working from home?
Like many businesses, the beef industry would like to know how long consumers can and will keep spending, but no clear consensus is emerging. Everyone is hoping for a “soft landing” but don’t expect many interest rate cuts in 2024.
We don’t have enough information to know definitively whether the merger between Kroger and Albertson’s (Safeway’s parent) would be anticompetitive or not. Supermarket margins are tight. But in typical government fashion, the Federal Trade Commission (FTC) is real-life clueless. Incredibly, the agency hasn’t yet caught on to the fact that Walmart or Target sell groceries. Natural food chains like Sprouts and the dollar stores that sell food don’t count either.
So, the FTC opposes the merger by not counting the No. 1 grocery seller, Walmart.
Many folks have caught on to the Green New Deal as a concept way ahead of its time, if not just an impractical fantasy the government is trying to conjure. But a recent editorial in the Wall Street Journal vividly pointed out that regardless of the shortsightedness of phasing out fossil fuels for all the hundreds of products derived to enable for modern standards of living, there is another colossal problem the greenies have not grasped.
Our electric grid is overtaxed in some regions already. But the new demands of artificial intelligence data centers, added to the (maybe) demands from electric vehicles and federally subsidized manufacturing plants like chip factories, would put exponential requirements on the grid we can’t begin to meet. Big data centers need 100 times the power as the average industrial plant and need it steadily around the clock. Already, new ones are waiting two to six years for power to be connected.
Upgrading the grid would require millions of new heavier transformers for homes and charging stations, heavier poles and lines for higher power needs, giant utility transformers for power stations with a multi-year wait even now, and lots more power generation in a country retiring coal and gas power plants by the dozens. One estimate for the cost of these upgrades by 2035 is a cool $1 trillion, paid by utility companies, taxpayers and electricity customers.
Candidates make promises in election years, and we are in the months when politicians get very nervous, noted Charlie Hurt, a commentator for the Washington Times, Breitbart and Fox News. So, President Biden is busy trading more student loan forgiveness for the youth vote. Hurt pointed out that 38% of voters hold bachelor’s degrees, many with paid-off student loans. That means the 62% of voters who didn’t get a college degree are supposed to pay for other peoples’ college loans. Parents who couldn’t afford to send their kids to college are expected to pay loans off for those who could.
California’s $20/hour mandate for fast food franchises has kicked in and some employees were shocked to find the doors locked when they went to work. Stores have cut back on employee numbers, cut hours for some, raised prices and closed some stores. Cutting volumes and access to fast food restaurants in the country’s biggest market is problematic for the beef industry and pinched consumers. Demand for ground beef has pushed 90% lean beef to levels well over $300, reflecting the need filled by chains and independents selling beef burgers.
That’s before the California Fast Food Council, empowered over the restaurants, imposes more mischief. — Steve Dittmer, WLJ columnist
(Steve Dittmer is the author of the Agribusiness Freedom Foundation newsletter. Views in the column do not necessarily represent the views or opinions of WLJ or its editorial staff.)
