The View from Right Field

Among the Reasons You Can’t Trust China's Reports on Coronavirus

While on our trip to Egypt, I saw an article in The Egyptian Gazette last Thursday on the coronavirus efforts in Wuhan, China.  The article reported that inspectors were going door-to-door in Wuhan, trying to identify every infected person.  Wang Zhonglin, the new Communist Party secretary in Wuhan, was quoted as saying, “If a single new case [of coronavirus] is found (after Wednesday), the district leaders will be held responsible.”  Which means, of course, that no new cases will be reported because the district leaders know what will happen to them if one is.

It reminds me of this story:

Uncertainty: The Reason the Economy Isn’t As Good As It Could Be

Donald Trump, like the real estate developer and TV host he was, calls everything the best and the greatest – and other adjectives I can’t come up with right now.  He says this about the economy.  The problem is that it isn’t true, but it could have been.  The 2017 tax reform act was a boost to the economy,¹ as were the cutbacks in regulation by the Trump administration and the end of the constant uncertainty as to what new regulation or interpretation or guidance the Obama administration might come up with next.  Because of these actions by people in the Trump administration, the economy started growing faster than under the Obama administration.

But, in spite of President Trump’s boasts and tweets, the economy hasn’t grown as much as it could have – because President Trump brought in his own brand of uncertainty.  In 2018, President Trump tweeted that “trade wars are good, and easy to win.”  The American economy doesn’t agree.  While we needed to do something about China’s unfair trade practices, President Trump’s approach of unilateral tariffs, plus China’s retaliation, resulted in higher costs and more uncertainty.  While China might have been hurt, we have been hurt, too.  Uncertainty is a drag on an economy, no matter what else you do.

Might It Have Been Possible to Oppose Donald Trump Without the Fury?

As we enter the last year of either Donald Trump’s presidency or President Trump’s first term, it seems like an appropriate time to look back on the last three years.  First, in looking at my posts about President Trump, I see I started out complaining a lot about what he did and his style of doing it.  Just look at some of the titles of my posts in his first nine months:

• “Donald Trump at Seven Weeks. This Is Not Working.”
• “Donald Trump Meets Angela Merkel. Things Keep Getting Worse.”
• “Donald Trump: Will the Embarrassment Ever End?”
• “@realDonaldTrump: Such a Small, Small Man”¹

But eventually, I got tired.  It wasn’t making a difference (obviously), and I was saying the same thing over and over again.  I got bored writing it.  I can only imagine how bored people got reading it.

Illinois and Stein’s Law

Herbert Stein, economist and Chairman of the Council of Economic Advisors under Presidents Nixon and Ford, is probably best known by many people today as the father of Ben Stein (of “Ferris Buehler's Day Off” and “Win Ben Stein’s Money” fame).  But Herb Stein is also known for “Stein’s Law”: “If something cannot go on forever, it will stop.”

Which is actually a lead-in to Illinois’s budget and unfunded pension liability mess.  Unless you believe that Illinois’s unfunded pension debt will never be a problem, because there will always be enough money in the fund to make current pension payments,¹ you would say that the present situation cannot go on forever; i.e., Illinois cannot continue to not properly fund its pension obligations.  But looking at the people we have in Springfield, you would despair of that ever happening.

Illinois Is Starting on the Next “Great Experiment”

On January 16, 1920, the Eighteenth Amendment came into effect, launching Prohibition across the country.  It was called, by some, the “Great Experiment.”  Needless to say, it did not work out as expected and, within fourteen years, it was repealed.

On Wednesday, Illinois began its own “Great Experiment,” though this one involves legalization, not prohibition, and it involves marijuana, not alcohol.  The question is how this new “Great Experiment” is going to turn out.

Government Subsidies – Programs That Never End

There is a saying that the only things certain in life are death and taxes.  And the only thing permanent is a government program.  The inability of the federal government, and state and local governments, to terminate programs that don’t work is proof of the latter.  Instead of getting rid of the old programs that don’t work, governments just set up a new program – again and again.  Which results in four or five (or more) programs all trying to solve the same problem, and none of them doing it well (if at all).

Overseas, the forever programs are often subsidies: for food, fuel, etc.  In theory, the subsidies are set up for good purposes: to help the poor.  (Of course, they are also set up to help politicians – get votes.)  The problem is that, over time, the subsidies become more and more expensive, as costs go up and prices don’t.  And corruption seeps in: subsidized fuel, for example, is sold to neighboring countries where prices are subsidized.

Thoughts on Ukraine, Donald Trump, and Joe Biden

The news articles are all about Donald Trump’s telephone call with the president of Ukraine and his request (suggestion, threat, whatever) that Ukraine investigate Joe Biden and/or his son Hunter Biden’s activities in or relating to Ukraine.  A few comments:

1.  Democrats claim they are shocked that President Trump would allegedly do this. I am not, but after the 2015-16 presidential campaign, nothing President Trump does either surprises or shocks me.

2. Some Democrats are calling for President Trump to be impeached. Really? It is less than fourteen months until the 2020 election.  Don’t impeach him.  Beat him.  Trying to impeach him is just going to get those people who supported President Trump in 2016 more motivated to vote for him again.  Republicans impeached Bill Clinton in 1998, and he got more popular.  If Democrats impeach President Trump on something like this, which is, as I mentioned in point #1, neither surprising nor shocking, they will just increase the chances he gets re-elected next year.

The Purpose of a Corporation. I’ll Go with Milton Friedman.

Last Monday, the Business Roundtable, a group of chief executive officers of big U.S. corporations, announced that it had changed its statement on the purpose of a corporation and had issued a new “Statement on the Purpose of a Corporation.”¹  This was a big deal:

“The leaders of some of America’s biggest companies are chipping away at the long-held notion that corporate decision-making should revolve around what is best for shareholders. …

No longer should decisions be based solely on whether they will yield higher profits for shareholders, the group said.  Rather, corporate leaders should take into account ‘all stakeholders’ – that is, employees, customers and society writ large. …

I Am So Tired of @realDonaldTrump

In the middle of his snit yesterday over trade and tariffs with China, President Trump tweeted, in part:

“Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” (Here and here)

I just don’t know what to say.  Maybe Xi Jinping and Kim Jung Un, people President Trump calls his friends, can order their companies to do this.  But, President Trump, you can’t do this.  We are a free country, and you can’t order people or companies around like some Communist dictator.  And saying things like this is stupid. 

Helping People Takes More Than Just Raising Taxes and Spending Money

Taxes are going up in Illinois tomorrow.  The gas tax is going up 18 cents a gallon, and there are probably other taxes going up, too.  Also, there will eventually be new taxes on things like marijuana and sports gambling.¹  I understand why taxes have to go up.  Illinois has spent more than it has raised in taxes for so long that the time has come to start paying up.  I am not sure, however, that enough of the tax increases is going toward the unpaid bills and funding the pension promises the legislators have been making for years.  Actually, I am sure.  Enough isn’t going for these things.  But that is not what I want to talk (spelled “r-a-n-t”) about today.  I want to talk about how the Illinois spends its money.

One of the problems with the politicians we have in Illinois is they seem to think that, once they have passed the programs and appropriated the money, their job is done.  They think that all they have to do is spend money and problems will be solved.  Which is just so far from being true.