Voice For Liberty

Tag: Economics

  • Rethinking the city and the community for a post-pandemic world

    Rethinking the city and the community for a post-pandemic world

    How has the pandemic affected cities in general and Wichita specifically, and what are implications for the future?

    Recently Chase M. Billingham, who is Associate Professor of Sociology at Wichita State University, delivered an online lecture titled “Rethinking the city and the community for a post-pandemic world.”

    In the lecture, Billingham covered topics such as the nature of cities and urbanism; how the pandemic has affected cities; how cities have suffered during pandemics throughout modern history, but have also led in innovation, medicine, and research.; COVID-19 will likely accelerate ongoing trends, especially economic trends; the effect of remote working on different workers; the pandemic’s effect on Wichita in the present and future?; the effect of the pandemic on city budgets and services; and rethinking cities — and Wichita — for a post-pandemic world.

    As you can see, topics are both general and specific to Wichita. The lecture is available on YouTube here.

    This lecture is part of a series by the university titled “Perspectives on the Pandemic: Part II.” More information is here.

  • Swamp refilling itself

    Swamp refilling itself

    Although there has been progress, cronyism and the swamp may be renewed in Washington.

    Right under the nose of a president who promised to drain the swamp, one of the government’s shadiest handouts to large banks and big companies looks like it will be renewed for another 25 years. It will not get adequate oversight and congressional review. All it will take is the approval of two out of three U.S. Export-Import Bank directors, who are political appointees.

    That entity is called the Private Export Funding Corporation, or PEFCO.

    Veronique de Rugy is a Senior Research Fellow at the Mercatus Center at George Mason University. She goes on to explain that PEFCO acquires Export-Import Bank loans from private lenders. (The Ex-Im Bank is its own universe of cronyism.) It gets complicated, but the upshot is that many people are earning fees and interest without assuming risk, as taxpayers assume all the risk.

    Many government programs guarantee loans. But as de Rugy notes: “The Export-Import Bank has been criticized for its cronyism, but PEFCO adds insult to injury because most of its shareholders are also its customers.”

    This is from her recent New York Times op-ed I Study Corporate Welfare. Even I Was Shocked by This Cronyism. A privately owned entity created by the Export-Import Bank allows its customers to also be its owners. A larger piece is her commentary Now Is the Time to Revisit the 50-Year Relationship Between the Ex-Im Bank and PEFCO.

    Click for larger
    PEFCO and the Export-Import Bank represent cronyism — the swamp — at its height. In her commentary, she notes: “Although PEFCO is ostensibly a private institution, its activities incur no risks for itself or its private shareholders.” In the nearby chart from PEFCO’s 2019 annual report, we can see that the country with the largest balance of loans is China. In other words, U.S. taxpayers are on the hook should China default on these loans.

    In the commentary, de Rugy closes with these recommendations:

    In light of the current economic crisis, some may feel that now is not the time to reconsider or even reform PEFCO. But not even the most pessimistic economic scenarios assume that the current crisis will last 25 years. Assuming that the liquidity argument holds, if the guarantee agreement between the Ex-Im Bank and PEFCO is renewed again, it should be renewed for only one year, at the end of which the need for, or appropriate role of, PEFCO should be revisited in light of prevailing economic conditions. In the meantime, the Ex-Im Bank should review the appropriateness of its exclusive relationship with PEFCO.

    In addition, PEFCO should under no circumstances be allowed to pay dividends to its shareholders, since they have zero capital at risk.

    Finally, to signal a ceiling on the level of support that US taxpayers will provide to PEFCO’s shareholders, the Ex-Im Bank should not expand its guarantee for the interest payments that PEFCO owes on its secured notes, as has been proposed.

  • Updated: Presidential data explorer

    Updated: Presidential data explorer

    Explore the economic record of presidents through the lens of data, with new updates for August.

    To examine the record of presidents regarding economics, I gathered data from several sources and present it in an interactive visualization. Today the interactive visualization has been updated with jobs and Dow Jones data for the month of August.

    For each president, data is presented by month, with the first month of each president’s term having number one. Presidents that served two full terms have data up to month 96 of their term, while others have fewer months.

    Data is shown in several views:

    • A table.
    • A timeline chart showing the monthly value of a statistic by month for each president. There are two versions.
    • A chart showing the change in the absolute value of a statistic by month for each president.
    • A chart showing the proportional change in the value of a statistic for each president.
    • Grids of the same data.

    Click here to learn more about the data and access the visualization.

    Example from the visualization. Click for larger.
  • Kansas tax revenue, August 2020

    Kansas tax revenue, August 2020

    For August 2020, total Kansas tax revenue fell by 43 percent from July, reflecting the tax deadline postponement from April to July.

    Tax reports from the State of Kansas for August 2020 show tax revenues recovering from the effects of the response to the pandemic.

    When reporting on Kansas tax collections, the comparison is usually made to the estimated collections. Those estimates were revised in April based on economic conditions affected by the response to the pandemic. To get a feel for the effects of the response to the pandemic, it is best to compare to the same month the prior year.

    For August 2020, individual income tax collections were $270,957,227, up 1.2 percent from last August. Retail sales tax collections rose by 0.9 percent to $207,091,484. Total tax collections were $543,492,901, up 9.3 percent from the same month last year. A nearby table summarizes.


    My report on tax revenue for April details some changes made by the estimating group.

    My interactive visualization of Kansas tax revenue has been updated with August data. Click here to use it.

  • Wichita jobs and employment, July 2020

    Wichita jobs and employment, July 2020

    For the Wichita metropolitan area in July 2020, the number of unemployed persons is up, the unemployment rate is up, and the number of people working is down, all by large amounts, when compared to the same month one year ago. The recent trend, however, is positive, and the effects of the pandemic have been less severe for Wichita than for the nation.

    Data released today by the Bureau of Labor Statistics, part of the United States Department of Labor, shows the effects of the response to the pandemic in the Wichita Metropolitan Statistical Area for July 2020.

    Click charts and tables for larger versions.

    Total nonfarm employment fell from 302,000 last July to 284,800 in July 2020, a loss of 17,200 jobs (5.7 percent). (This data is not seasonally adjusted, so month-to-month comparisons are not valid.) For the same period, employment in the nation fell by 7.7 percent. The unemployment rate in July 2020 was 10.9 percent, up from 3.9 percent one year ago.

    Considering seasonally adjusted data from the household survey, the labor force rose by 564 persons (0.2 percent) in July 2020 from June 2020, the number of unemployed persons fell by 289 (0.8 percent), and the unemployment rate was 10.8 percent, down from 10.9 percent in June. The number of employed persons not working on farms rose to 284,162 in July from 283,309 the prior month, an increase of 853 persons (0.3 percent).

    The following chart of the monthly change in the labor force and employment shows the magnitude of drop in April overwhelming other months, and then a positive change in employment for the following months. The rate of increase in employment has slowed since a large jump in May.

    The following chart of changes from the same month one year ago shows a similar same trend — fewer jobs, although the labor force grew.

    The following chart of changes in employment from the same month of the previous year shows many months when the Wichita MSA performed better than the nation. In all months affected by the pandemic, we see the decline in employment Wichita has not been as severe as the nation.

    The following two charts show changes in jobs for Wichita and the nation over longer periods. The change is calculated from the same month of the previous year. For times when the Wichita line was above the nation, Wichita was growing faster than the nation. This was often the case during the decades starting in 1990 and 2000. Since 2010, however, Wichita has rarely outperformed the nation and sometimes has been far below the nation.

    (For data on all metropolitan areas in the nation, see my interactive visualization Metro area employment and unemployment.)

  • Updated: Economic indicators in the states

    Updated: Economic indicators in the states

    Economic indicators in the states, an interactive visualization.

    The Federal Reserve Bank of Philadelphia calculates two indexes that track and forecast economic activity in the states and the country as a whole.

    The coincident index is a measure of current and past economic activity for each state. The leading index predicts the six-month growth rate of the state’s coincident index. Positive values mean the coincident index is expected to rise in the future six months, while negative values mean it is expected to fall. (For more detail, see Visualization: Economic indicators in the states.)

    In the coincident index, the effects of the response to the pandemic are evident. Before the pandemic, the coincident index for Kansas was growing at about the same rate as the nation.

    The coincident index is available through July 2020, while the leading index is available through February. I was not able to learn why the leading index has not been updated.

    A nearby chart shows index values for the last five years for Kansas, some nearby states, and the United States. You can access the visualization and create your own charts here: Visualization: Economic indicators in the states.

    Example from the visualization. Click for larger.
    Example from the visualization, ending before the pandemic. Click for larger.
  • Added to presidential data explorer: Economic indexes

    Added to presidential data explorer: Economic indexes

    Explore the economic record of presidents through the lens of two economic indexes.

    To examine the record of presidents regarding economics, I gathered data from several sources and present it in an interactive visualization. Today, two economic indexes have been added.

    The Federal Reserve Bank of Philadelphia calculates two indexes that track and forecast economic activity in the states and the country as a whole. The coincident index is a measure of current and past economic activity for each state. The average value for the complete year 2007 is given the value 100. The leading index predicts the six-month growth rate of the state’s coincident index. Positive values mean the coincident index is expected to rise in the future six months, while negative values mean it is expected to fall. 1

    For each president, data is presented by month, with the first month of each president’s term having number one. Presidents that served two full terms have data up to month 96 of their term, while others have fewer months.

    Data is shown in several views:

    • A table.
    • A timeline chart showing the monthly value of a statistic by month for each president. There are two versions.
    • A chart showing the change in the absolute value of a statistic by month for each president.
    • A chart showing the proportional change in the value of a statistic for each president.
    • Grids of the same data.

    Click here to learn more about the data and access the visualization.

    Example from the visualization. Click for larger.

    —
    Notes

    1. For more about these indexes, and for a visualization of these for each state, see Visualization: Economic indicators in the states. ↩
  • China trade deal progressing slowly

    China trade deal progressing slowly

    We now have trade numbers for July 2020, and the U.S. trade deal with China is not meeting expectations.

    The United States Census Bureau has released data regarding United States trade with China through July 2020. The Peterson Institute for International Economics has analyzed this data.

    According to the Peterson analysis, China is not on pace to meet the terms of the deal which is the Economic and Trade Agreement Between the United States of America and the People’s Republic Of China: Phase One, which went into effect on February 14, 2020. For all products, China is purchasing U.S. products at a rate slightly less than half the anticipated rate. 1

    The agreement does not specify when China must make purchases except by the end of the year. But on a pro-rated basis, the rate is less than half of the target, meaning that China would need to greatly accelerate its purchases in the second half of the yeat to meet the targets.

    Of note, the trade agreement provides for two measurements: “Official Chinese trade data and official US trade data shall be used to determine whether this Chapter has been implemented.”

    Click for larger.

    —
    Notes

    1. “Through July 2020, China’s year-to-date total imports of covered products from the United States were $48.5 billion, compared with a prorated year-to-date target of $100.7 billion. Over the same period, US exports to China of covered products were $39.3 billion, compared with a year-to-date target of $83.2 billion. Through the first seven months of 2020, China’s purchases of all covered products were thus only at 47 percent (US exports) or 48 percent (Chinese imports) of their year-to-date targets.” See https://www.piie.com/research/piie-charts/us-china-phase-one-tracker-chinas-purchases-us-goods. ↩
  • Added to presidential data explorer: Primary Energy Net Imports

    Added to presidential data explorer: Primary Energy Net Imports

    Explore the economic record of presidents through the lens of energy independence.

    To examine the record of presidents regarding economics, I gathered data from several sources and present it in an interactive visualization. New to the visualization is Primary Energy Net Imports. When this number is negative, it means the United States is exporting more energy than it imports. This data comes from the U.S. Energy Information Administration.

    Primary energy is “Energy in the form that it is first accounted for in a statistical energy balance, before any transformation to secondary or tertiary forms of energy. For example, coal can be converted to synthetic gas, which can be converted to electricity; in this example, coal is primary energy, synthetic gas is secondary energy, and electricity is tertiary energy.”

    For each president, data is presented by month, with the first month of each president’s term having number one. Presidents that served two full terms have data up to month 96 of their term, while others have fewer months.

    Data is shown in several views:

    • A table.
    • A timeline chart showing the monthly value of a statistic by month for each president. There are two versions.
    • A chart showing the change in the absolute value of a statistic by month for each president.
    • A chart showing the proportional change in the value of a statistic for each president.
    • Grids of the same data.

    Click here to learn more about the data and access the visualization.

    Example from the visualization. Click for larger.