Friday, January 29, 2021

Biden’s Stimulus Package – Good, Bad, Too Much, Not Enough, and Vastly Better Than Nothing


Two weeks ago yesterday the not-yet president proposed a $1.9 trillion effort aimed to help the American economy, and the people in it, recover from the pandemic’s effects.

A good stimulus should do two things.  First, it should help people, perhaps but not necessarily through organizations they need, avoid or mitigate life disasters.  Second, any money it provides for other reasons should be designed to come back, either through taxes or by cutting costs the federal government would otherwise accrue.  If all or almost all of its expense fits in one or both of these categories, it is worthwhile, nearly regardless of how much money is involved. 

Using these standards, how does the proposal measure up?  Taking “A Look at What’s in Biden’s $1.9 Trillion Stimulus Plan” (Jeanna Smialek, The New York Times, January 14th), we see quite a mixed bag. 

First, the scheme calls for “$1,400 per person for those under certain income thresholds, topping off the $600 checks” from December.  That would qualify under both points above if the income limit were low, but it is not.  Per Steven Rattner’s “Biden’s Relief Plan Is a Trojan Horse.  And I’m OK With That,” in the same publication on January 27th, at least part of this amount would go to people with annual family incomes as high as $310,000, “many middle and upper-middle-class Americans have been stashing money away at a ferocious rate,” and “merely putting cash into Americans’ pockets is not what’s needed for the overall economy.”  This line item would cost $465 billion, of which no more than half would be spent quickly.

Second on Smialek’s list, per Biden’s document, is ”a $400 per week unemployment insurance supplement to help hard-hit workers,” through the end of September.  That may be too high and too long, with more of the jobless getting well over what they were earning at work, and strong prospects for a summer economic boom.  This item is not as easy to algorithmically limit as the $1,400 checks, but if there were a way of thinning it out without causing great delays that should be done.

Next, Smialek mentioned payments to “kindergarten-to-eighth-grade” schools to enable them to reopen.  Even if all agree that would be safe enough to pursue, it is not clear why that would cost in the tens of billions, though some of that would return from taxes on higher incomes facilitated by not needing to supervise children at home.  Then her piece moved to the most controversial part, minimum wages to rise to $15 per hour.  That would not be immediate, and there was no timeline.  Per Veronique de Rugy’s January 21st Reason “Joe Biden’s Plan for Big Government,” that would also include an end to restaurants’ “tipped minimum wage,” which can be as little as around $2.50 per hour, causing more problems for an already crippled industry.  That pales, though, with the unsuitability of making broad-based increases to something with substantial local variation.  As shown in this map from “By the numbers:  The impact of the $15 minimum wage,” by Erica Pandey on January 20th in Axios, the “estimated real purchasing power” of $15 varies across the country’s metropolitan areas from $11-$12 (dark red) to $17-$20 (dark blue):


Other articles concurred, such as “Here’s how many jobs Biden’s proposed $15 minimum wage could kill, according to the Congressional Budget Office” by Lucas Manfredi in the January 18th Fox Business, which concluded “as many as 3.7 million.”  Since jobs going away helps neither people nor the economy, it has long been my bias to oppose minimum wage hikes, and here we do not have an exception. 

As Smialek continued, the plan would contain $440 billion for “communities” including small businesses, excellent under the second standard above and valuable also for the first.  Mandating paid leave would help the people involved, if not the financial system, and providing refundable tax credits for parents may not be positive, as it duplicates other items here and encourages people to work when it is not safe. 

That leaves, per Smialek, “$160 billion in funding for a national vaccination program, expanded testing, a public health jobs program and other steps meant to fight the virus.”  Although I have long thought of testing as being unresponsive to our situation, keeping vaccinations going is among our nation’s highest priorities.  I do not see why such spending has not been long before approved.

So, is the $1.9 trillion proposal good or bad?  As a rough cut it is certainly favorable.  There needs to be more debate on several of the items, while ensuring minimum vaccination delays.  But for now we must do something.  “Ready, fire, aim” can work for government as well as business, so if this is the best we have, let’s start.

Friday, January 22, 2021

The Coronavirus Status: Better, But Worse Than It Seems


As much as I want to focus on other issues, the pandemic has more effect on jobs and the economy than anything else.  It continues to change, so here we go again. 

The leading indicator, whether it should be or not, the 7-day average of number of new United States cases, as of Thursday was 188,110, down a whopping 27% from its all-time peak 13 days before.  Daily deaths measured the same way were 3,078, off 8% from its 9-days-before historic high, and hospitalizations, which also crested on January 12th, now average 124,008 or 5% lower. 

The American map of daily new cases, also from the January 22nd New York Times, has changed a lot.  With darker colors showing the highest rates, Thursday’s data came out thus:


The angriest-looking areas have moved from the upper Midwest to California, Arizona, and South Carolina, with Oklahoma, parts of Texas, and New York state not far behind.  The light colors in the former Nynex area in the Northeast, seemingly reflecting better social distancing, are no longer consistent, and Wisconsin, infamous for high drinking and its concurrent gatherings, now does not stand out at all. 

Another issue critical to track is vaccine distribution.  A national map in the January 20th New York Times showed little state-by-state difference – per the same publication and date “about 14.3 million people have received at least one dose of a Covid-19 vaccine” and “about 2.2 million people had been fully vaccinated.”  As reported in the January 19th USA Today, almost half of distributed doses, which per the January 20th Times were “about 36 million.”  The lack of overall project management is still scandalous, but we are making progress.

We know that the Pfizer and Moderna vaccines are the only ones approved for full United States use, but what it the status of the others?  As reported in the January 19th New York Times, eight more – products by Gamaleya, Oxford AstraZeneca, CanSino, Vector Institute, Sinopharm, Sinovac, Sinopharm-Wuhan, and Bharat Biotech – have been approved in some countries for at least emergency use, and 58 others are in various development stages. 

Great further help is on the way, not only with vaccines but with the defensive struggle, as “Biden Unveils National Strategy That Trump Resisted” (Sheryl Gay Stolberg, The New York Times, January 21st), as now we have a president who calls his responsibility a “full-scale wartime effort” and says we are “still in a very serious situation.”  We now have a mask-wearing mandate on “interstate planes, trains and buses” along with “the creation of a national testing board and mandatory quarantines for international travelers arriving in the United States.”

Despite all that is positive, there remain real cautions.  One reason American pandemic numbers have improved is not only people getting vaccinated, but the estimated 1 in 15 who have already had the virus.  Factoring those things in, we are doing better than a week or two ago but not massively.  As before we should not confuse lower infection, death, and hospitalization rates with a safer country.  It is important for all of us to continue our precautions until we are fully protected – then, but only then, we can have those parties, go to large concerts and major sporting events, resume nightclub visits, and, for those without romantic partners, improve that situation.  In the meantime, watch this blog – I will keep you up to date. 

Friday, January 15, 2021

Surveillance and Facial Recognition – Right and Wrong Ways to Deal with Them

With the Capitol insurrection and consequent second impeachment, it may seem like political stability will be the most important long-term American problem as Covid-19 infections, deaths, and hospitalizations come slowly down.  It is now more urgent, but should settle down almost completely by spring.  What we can’t forget are the two issues that loomed largest before the virus spread.

In February, I wrote a three-part series on widespread electronic surveillance, ending by recommending five courses of action.  They were allowing people to opt out from phone tracking and face comparisons, giving cellphone-system data the same legal protection as those from landline telephones, banning location sharing by phone apps, holding a referendum on what electronic information law enforcement agencies may collect and use, and having a public service campaign educating people on the existence of and their control of data-collection sources.  Soon after that, we got two articles furthering this issue – Mona Wang and Gennie Gebhart’s March 7th Truthout “Schools Are Operating as Testbeds for Mass Surveillance,” and John Seabrook’s March 9th New Yorker “Dressing for the Surveillance Age.”  The first, while as much an editorial as a news piece, informed us that some school districts send “”automated alerts” to school administrators, and in some cases, local police” when students explore “sites relating to drugs and violence, as well as terms about mental and sexual health.”  Online searches have long been less private than we, and especially our children, might think.

The second, showing an example of how the market can speak, asked “can stealth streetwear evade electronic eyes?”  Seabrook concluded that yes, at least some of the time with current technology, it can.  As with innocent looking stickers that fool driverless cars, clothing that to human eyes make someone “impossible to miss” has been designed under such names as “invisibility cloak” and “Jammer Coat.”  Incredible as it may seem, the right patterns can make someone seem transparent to artificial intelligence networks, with objects behind them visible as ever.  Unlike the automated-vehicle deterrents, the garments are clearly legal and ethical, but it seems only a matter of time until surveillance technology software catches up. 

News on the other concern, though, did not stop with the coronavirus.  “Even the Machines Are Racist.  Facial Recognition Systems Threaten Black Lives,” by Eisa Nefertari Ulen in Truthout on March 4th, summarized the main objection to use of this knowledge, that it gives erroneous matches more often for nonwhites.  That problem hit to the core, as, on June 9th we saw that “IBM Says It Will Stop Developing Facial Recognition Tech Due to Racial Bias” (Hannah Klein, Slate), and that, one day later, “Amazon Pauses Police Use of Its Facial Recognition Software” (Karen Weise and Natasha Singer, The New York Times).  Both were for the same general reasons, problems with “Asian and black faces” (Klein) and in response to “misidentifying people of color” (Weise and Singer).   

It is possible that such technology has been used more than its level of reliability has justified, though it has had large successes.  The core problem, though, may be something many Americans may not be willing to accept.  While the people we call “whites” have origins all over Europe, the Middle East, and beyond, those we call “African Americans” in this country are mainly only from the western African coast, and were often bred together, and with whites, after that.  The vast majority of Americans of eastern Asian descent are from the ethnic Han areas in Japan, China, and Korea.  It may be that the faces of people in those groups simply vary less than those in others, so will require more work to differentiate. 

Why did IBM not focus on further improvement instead of halting efforts?  Why did Amazon not continue using these tools for groups with which they have been more effective?  Why did I read, in “Facial Recognition Technology Isn’t Good Just Because It’s Used to Arrest Neo-Nazis” (Joan Donovan and Chris Gilliard, Slate, January 12th, 2021), that “those who have looked deeply at the values underlying it see (this capability) as deeply flawed, racist, and a debasement of human rights”?  The reason is that the ability to automatically recognize faces has been pulled into our national racial impasse.  That means, as in too many other areas, that truth in their design and results is no longer universally sought out, accepted, or even primarily valued. 

Where will we go with identification and tracking of people?  We don’t know, and it is important.  Can we get the most from allowing these things without letting them end our privacy forever?  That is something we need to focus on, as soon as politics and Covid-19 calm.  For now, though, we must be aware that letting these issues solve themselves may be the worst resolution we could have.               

Friday, January 8, 2021

December Jobs Data: Unemployment Holds; First Net Employment Loss Since April Only Part of Reason AJSN Showed Latent Demand for Work Up 273,000 To 21.2 Million

The only projection I saw for the number of net new nonfarm payroll positions in this morning’s Bureau of Labor Statistics (BLS) Employment Situation Summary was plus 71,000, and it missed by more than 200,000.  The 140,000 loss was the first since April.

Fortunately, the other numbers did not consistently follow.  Seasonally adjusted and unadjusted unemployment stayed the same and gained 0.1%, to 6.7% and 6.5% respectively.  There are still 10.7 million Americans officially jobless.  The count of those on temporary layoff rose over 200,000 to 3.0 million, consistent with the 800,000-averaging weekly unemployment claims.  Those out for 27 weeks or longer edged up 100,000 to 4.0 million.  The two measures of how common it is for people to be working or one step away, the labor force participation rate and the employment-population ratio, did not suffer, with the former still 61.5% and the latter up 0.1% to 57.4%.  The number of those working part-time for economic reasons, or keeping less than full-time employment while looking for that with longer hours, surprisingly fell almost 500,000 and is now 6.2 million.  Average private nonfarm hourly earnings shot up 23 cents per hour, not a good sign since that means more lower-paid people are not working, and is now $29.81.

The American Job Shortage Number or AJSN, the metric showing how many people would work if getting a job were known to be as easy as buying a six-pack, increased for the first time in eight months, as follows:

Almost half of the AJSN’s monthly gain was from higher official unemployment, with most of the rest from those not looking during the past year.  With the share of the AJSN from unemployment unchanged at 44.1%, rises in the other categories above kept pace with December’s job losses.  Do not be fooled into thinking that the count of those claiming no interest in working is permanent – it consistently decreases when more work opportunities become available.  Since a year ago, the AJSN has gained over 6.2 million, about 70% from increased official joblessness.

The other data side remains the status of Covid-19 in the United States.  How did we do with that when the BLS information was taken?  Not well at all.  From November 16th to December 16th, per The New York Times, the 7-day average number of new daily cases went from 155,532 to 211,008, or 36% more.  The two other measures did worse, with the average count of hospitalized patients up from 73,268 to 109,969, or 50%, and average daily deaths up a shocking 120% from 1,155 to 2,545.  All three numbers have increased further since then, and are now at all-time national highs. 

Overall, the picture is bleak.  We cannot blame the steady upward coronavirus march on too many people at work – with the population increase, the jobs loss had more effect than 140,000 – but we’re clearly doing plenty of things wrong as a nation.  However, relief from vaccinations, of which 4.5 million Americans have received their first of two doses and about 500,000 more join them each day, should help both employment and pandemic figures as soon as next month.  In the meantime, we still cannot afford to put jobs ahead of health.  Help is on the way, but this time the turtle staggered backwards once more.

Friday, January 1, 2021

American Changes for 2021-2022 – II

“It’s tough to make predictions, especially about the future” – Yogi Berra

Last week I looked at some of the many 2021 jobs-and-economy forecasts and semi-forecasts.  Now it is time for my views.

There are four general patterns of change and non-change.  The first could be called “pent-up demand,” either what happened after World War II with housing and previously unavailable consumer goods, which created tens of millions of civilian jobs, or simple resumption.  The second is “acquiescence,” or situations where people decide they preferred what they had to do during the pandemic, including innovations and efficiencies discovered, tested, and at least partially debugged over the past year.  Third is “as expected,” in which trends, whether interrupted or not, go back to either where they were or where they were headed before Covid-19.  Fourth is “new perspective,” when, on the edge of resuming an activity after a break, people decide they do not want to do it in the same way they did before, do not want to do it at all, or wish to start something new. 

To project how something will be different is to determine which pattern will apply.  Sometimes that seems easy, and otherwise we have to look at the strength of the factors involved – how much incentive people have to follow certain methods.  There will always be a great deal unknown, as anyone associated with commercial success of any kind of art can relate.  Yet we can still do better than chance.  Accordingly, I extend the following.

On working at home, the second and third patterns will operate.  Before March, there was a movement by large organizations to bring employees back into the office, with amenities designed to encourage longer hours there, but many workers discovered how much they liked not needing to commute.  (The nasty things, such as slanted toilets and self-serving messages on water-cooler cucumbers, though, will be nipped in the bud – a perfect application of the fourth pattern.)  Outcomes here will vary greatly by company, and after a year or two will resume being in effect an employee benefit.  Zoom calls, though, which nobody seems to like, will go away, replaced again by conference calls or in-person gatherings.

One thing teachers and school administrators have discovered is that remote learning for students below high school, to which the first pattern applies, does not work.  Its disadvantages, from students losing snow days to uncorrectable income and home-setting differences, have become known, with little on the other side.  Expect distance classes to end for junior high and below as soon as pandemic infection levels drop substantially, probably with the 2021-22 school year.  The same will pertain to wearing masks and practicing social distancing, for the same reasons.    

As for permanent changes to restaurants, we don’t see any, except for thinning of their numbers caused by many forced out of business.  The fourth pattern, in which many people notice how much less money they have spent on eating out, will apply, and demand, not helped by insufficiently worthwhile high-end takeout meals, will drop.  There will be new places, but fewer prospective entrepreneurs than before will feel motivated to start such ventures.  Other storefront businesses will do better, but indefinitely lower demand for space in the likes of New York City will force rents down.

Per the third pattern, I do not predict significant changes to labor laws.  What looked like a push to raise wages and provide benefits such as paid sick days to low-level customer-facing workers, such as grocery clerks and cashiers, seems to have petered out, with some seeing the stimulus payments and possible preferential vaccine treatment as close enough to fair compensation.  The cases against mandating broad-based pay increases are as strong as ever, and with a moderate president will continue to stop the passing of laws requiring the likes of $15 per hour for everyone.  The struggles between Uber, Lyft, Airbnb, and their resource providers will continue, with the companies getting the worst of them most of the time.

Will proof of vaccination become a credential needed for many 2021 activities?  Yes – and it will indicate a two-class society, not by race or income but by the choice of whether to get injected.  It will probably be required for travel to certain states and countries without quarantining, for entry to some restaurants, bars, or social clubs, and elsewhere.  I don’t know about large spectator events, as such numbers make fraudulent credentials hard to stop, and all it would take would be one case of some such liar superspreading the virus to make us all realize that, once again, a few people can ruin things for the rest of us.  By mid-2022, with these advantages and the taming of Trumpism, about 95% of Americans will have had one of many vaccines long since readily available.

Happy new year.  I hope 2021 is as good to all of us as I believe it will be.