January 31, 2016

AP Acts As If Illinois’ Chronic Delinquency in Paying Its Bills Is a New Development

A Saturday report by Associated Press political writer John O’Connor acts as if the the sordid history of fiscal irresponsibility in the State of Illinois is a new development brought on by a stubborn Republican governor in just the past seven months.

What hogwash. The state has had a large backlog of delinquent unpaid bills for a decade, if not longer. Five years ago, a Democratic governor and a Democrat-dominated legislature enacted steep income and property tax increases, promising that the additional taxes raised would enable the state to whittle down the unpaid backlog, solve the state’s horrific unfunded pension liabilities problem, and generally right the fiscal ship. Naturally, they did no such thing. O’Connor also didn’t find any of the tax or bill-delinquency history worth recounting in his 800-word report. Instead, he relayed stories of the kinds of hardships caused by the State’s delinquency which, though genuinely gut-wrenching, could have and should been covered regularly by the national press during the past several years.

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WashPost Writer: Despite Venezuela’s Collapse, Govt. Giveaways Are ‘Good Idea in General’

In trying to explain the current situation in Venezuela, the Washington Post’s Matt O’Brien, in a post at the paper’s Wonkblog, also inadvertently identified two reasons why authoritarian socialist tyrants like Huge Chavez and Nicolas Maduro are able to achieve and retain power.

The formula is simple: When you first gain power, garner international and media goodwill by giving stuff away, like housing and gasoline. That wlll earn you props from the likes of O’Brien and liberals everywhere who have come to believe that doing so “is a good idea in general.” Meanwhile, you can work in the background to overturn whatever checks and balances your country’s political system might have. If the populace finally figures out what you’re really up to and rises up in opposition, they can’t stop you — even if your party gets blown out in elections and takes over what has become, thanks to you, an impotent legislature.

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No Ferguson Effect? St. Louis, Baltimore Now in World’s Top 20 For Murder Rates

Those in the press who have insisted that the “Ferguson effect” is an urban legend will have a hard time explaining why the two cities with the most potential to be affected by this supposedly mythical phenomenon now have murder rates among the top 20 in the entire world.

St. Louis, Missouri, next door to Ferguson, where a leftist-”inspired” campaign of “protests,” civil disorder and rioting began in August 2014, came in at Number 15, with a rate of 59 murders per 100,000 residents. The city’s 188 murders in 2015 were up from 159 in 2014 and 120 in 2013. Baltimore, Maryland, where Mayor Stephanie Rawlings-Blake infamously admitted in April 2015, as public safety was deteriorating in her city, that “we also gave those who wished to destroy space to do that,” was Number 19, with 344 murders (a rate of 55 per 100,000).

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Sunday Off-Topic (Moderated) Open Thread (013116)

Filed under: Lucid Links — Tom @ 6:00 am

This open thread is meant for commenters to post on items either briefly noted below (if any) or otherwise not covered at this blog. Rules are here.

Positivity: Hundreds of thousands attend ‘Family Day’ as Italy debates same-sex unions

Filed under: Positivity — Tom @ 5:55 am

From Rome:

Jan 30, 2016 / 12:24 pm

Rome’s Circus Maximus was the site of a massive rally against a proposed law which would allow same-sex unions across the country of Italy.

Hundreds of thousands are estimated to have gathered for ‘Family Day’ at the historic site in the capital city a week ahead of a vote which could allow same-sex couples to legally enter into civil unions.

If passed, the legislation would grant same-sex couples – as well as non-married couples of the opposite sex – the same legal rights as married couples of the opposite sex.

Among the legal allowances would be the adoption of a child by the same-sex partner of his or her parent.

To date, Italy offers no legal rights to same-sex couples.

“Italy is one of the few western countries that is still resisting this deviation,” said Family Day organizer Massimo Gandolfini in an interview with Sky Tg24. Most European countries allow for legalized same-sex unions in some form.

At a speech during the Family Day rally, Gandolfini told the crowds: “Without limits, our society will go mad!” the AP reports.

Speakers addressed the throngs of crowds peacefully demonstrating with banners and signs, many of which called for the protection of a child’s right to a mother and a father.

The proposed bill to give legal rights to same-sex partnerships was submitted to parliament Oct. 7, 2015. …

Go here for the rest of the story.

January 30, 2016

Bloomberg Writer: ‘Economic Growth Isn’t Everything’

Observers can be excused for thinking that the politicial establishment is preparing the battlespace to convince us plebes that progress and economic growth are overrated. (That’s sort of odd for people who call themselves “progressives,” but making sense is not their strong suit.)

How interesting, for example, that Northwestern University economist Robert Gordon’s book, The Rise and Fall of American Growth was released on January 12, even though, as Bloomberg writer Noah Smith notes, Gordon “has been going around for several years making … (the) case (that) … the golden days of growth are over.” Just in time for the arrival of a more visibly weak economy, Gordon’s premise has been getting wildly disproportionate press attention. Smith goes further in his “Economic Growth Isn’t Everything” column, referring to “the illusion of stagnation” (i.e., don’t believe those weak stats, even if they go negative; everything is really fine), while reminding us of the supposedly marvelous things government has done and supposedly can still do for us.

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Press Predicts How Economy Will ‘Strengthen’ After Weak GDP Report, Ignores How 4th Quarter May Further Weaken

As has been its habit during the Obama administration when the economy turns in a poor performance, the press’s coverage of yesterday’s report on U.S. economic growth focused on how much better next quarter’s news will supposedly be. Especially in this instance, the beat reporters and pundits should have looked at whether or not yesterday’s initial result will hold up, or whether it’s likely to be revised downward.

The government’s Bureau of Economic Analysis reported yesterday that the economy grew at an annualized rate of 0.7 percent in last year’s fourth quarter. That’s bad enough, but statements published by a leading GDP prognosticator before the BEA’s release, once applied to yesterday’s data, foreshadow a distinct possilbity that February’s or March’s revision will come in with a minus sign preceding it.

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Press Drags Out ‘Warm Weather’ to Excuse Poor Fourth-Quarter Growth

Friday morning, the government reported that the economy grew at a pathetic annual rate of 0.7 percent in last year’s final quarter.

As it did in covering the disappointing Christmas shopping season, the business press partially blamed yesterday’s awful result on the weather, i.e., warm weather.

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Saturday Off-Topic (Moderated) Open Thread (013016)

Filed under: Lucid Links — Tom @ 6:00 am

This open thread is meant for commenters to post on items either briefly noted below (if any) or otherwise not covered at this blog. Rules are here.

Positivity: From slavery to model of mercy – the powerful story of Julia Greeley

Filed under: Positivity — Tom @ 5:55 am

From Denver:

Jan 28, 2016 / 03:06 am (CNA/EWTN News).- Julia Greeley was a familiar sight on the streets of Denver in the late 1800s and early 1900s.

Wearing a floppy hat, oversized shoes, and dabbing her bad eye with a handkerchief, Greeley was often seen pulling her red wagon of goods to deliver to the poor and homeless of the city. She had a particularly special devotion to the Sacred Heart, and would deliver images and information about the icon to firefighters throughout Denver every month.

Her charitable work earned her the title of a “one-person St. Vincent de Paul Society” from one writer, and has made her the local model of mercy for the Jubilee Year of Mercy.

Born a slave in Hannibal, Missouri sometime between 1833 and 1848, Greeley endured some horrific treatment – once, a whip caught her right eye and destroyed it as a slave master beat Greeley’s mother.

One of many slaves freed by Lincoln’s Emancipation Proclamation in 1863, Greeley’s work with the family of William Gilpin, Colorado’s first territorial governor, brought her to Denver in 1878.

After leaving the Gilpins’ service, Greeley found odd jobs around the city, and came upon the Sacred Heart Parish of Denver, where she would convert to Catholicism in 1880. She was an enthusiastic parishioner, a daily communicant, and became an active member of the Secular Franciscan Order starting in 1901. The Jesuit priests at her parish recognized her as the most fervent promoter of devotion to the Sacred Heart of Jesus.

Despite her own poverty, Greeley spent much of her time collecting food, clothing and other goods for the poor. She would often do her work at night, so as to avoid embarrassing the people she was assisting.

“She stood out because of how extraordinary she was,” David Uebbing, chancellor of the Archdiocese of Denver, told the Denver Catholic.

“Even though she was only earning $10 to $12 a month cleaning and cooking, she was using it to help other people who were poor,” he said.

“That spoke volumes about the charitable heart she had. In addition, she had great devotion to the Sacred Heart of Jesus and was known for walking (monthly) to 20 different firehouses to give (felt) badges of the Sacred Heart and tracts to firemen. That brings to life the corporal and spiritual works of mercy this holy year is dedicated to.”

Julia Greeley died on June 7, 1918 – the Feast of the Sacred Heart. Although her death came unexpectedly, she was able to receive last rites. It is estimated that she was around 80 years old, though because she was born into slavery, her exact age was never known.

After her death, her body lay in state in a Catholic parish for five hours, during which a constant stream of people came to pay their last respects to the well-known, well-loved woman. …

Go here for the rest of the story.

January 29, 2016

AP: 8 Smoking Guns Later, Hillary Still ‘Will Not Be Charged,’ Per ‘Experts’

This afternoon, Catherine Herridge at Fox News reported that “the intelligence community has deemed some of Hillary Clinton’s emails ‘too damaging’ to national security to release under any circumstances.”

This eighth “smoking gun” — on top of the seven an Investor’s Business Daily editorial identified last week — wasn’t enough to move the Associated Press Bradley Klapper from the AP’s default position virtually since Mrs. Clinton’s private email server was discovered, naturally referencing unidentified “independent experts,” namely that “it’s unlikely Clinton will be charged with wrongdoing.”

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4Q15 Gross Domestic Product, 1st (Advance) Reading (012916): An Annualized 0.7 Percent; Negative Inventory Effect Far Lower Than Predicted; Feb. and March Revisions Going Into Contraction Is a Distinct Possibility

Filed under: Economy,Taxes & Government — Tom @ 7:15 am

Predictions:

There are so many reasons in the hard data coming from Uncle Sam and others during the past several months why today’s report should be worse than the consensus predictions. But it has all seemed to come down to consumption and inventory changes with GDP in recent quarters, so it’s hard to bet against the consensus predictions. One would think that if there’s a surprise, it would almost have to be to the downside. But again, consumption uber alles.

The report will be here at 8:30 a.m.

HERE IT IS (full text version):

Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at an annual rate of 0.7 percent in the fourth quarter of 2015, according to the “advance” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.0 percent.

The Bureau emphasized that the fourth-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see the box on page 4 and “Comparisons of Revisions to GDP” on page 5). The “second” estimate for the fourth quarter, based on more complete data, will be released on February 26, 2016.

The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), residential fixed investment, and federal government spending that were partly offset by negative contributions from private inventory investment, exports, and nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

The deceleration in real GDP in the fourth quarter primarily reflected a deceleration in PCE and downturns in nonresidential fixed investment, in exports, and in state and local government spending that were partly offset by a smaller decrease in private inventory investment, a deceleration in imports, and an acceleration in federal government spending.

Real gross domestic purchases — purchases by U.S. residents of goods and services wherever produced — increased 1.1 percent in the fourth quarter, compared with an increase of 2.2 percent in the third.

The final paragraph confirms the domestic slowdown the press, which has insisted on telling us that it’s all about what’s going on the in the rest of the world, has avoided reporting.

I’ll have the breakdown and comparisons to previous quarters shortly.

UPDATE: Here’s the breakdown:

GDPcomponentsThru4Q15at012916

Here’s the problem, identified in the following paragraph in Moody’s pre-release prediction yesterday, captured here, because it won’t remain for long:

MoodysGDPgrafOnInventories012816

As seen in the table above, inventories substracted only 0.45 points from GDP. As seen in the announcement, real final sales only rose 1.1 percent instead of 2.1 percent

If Moody’s is ultimately right about inventories — and there are others who have expected an inventory effect roughly as large or larger — then future revisions have a very high chance of pulling fourth-quarter GDP into negative territory.

(Specifically, if you take another 0.85 points away from today’s 0.7, based on a projected 1.3-point inventory hit instead of the currently reported -0.45, you get a negative 0.15 percent reading.)

Another factor which may pull revised GDP down is consumption, if retail sales, durable goods shipments, or wholesale sales in December get revised downward. Previous months’ originally reported retail sales have been revised downward in the following report on an almost regular basis.

But, as noted an inventory-related writedown of GDP seems very likely February or March. Today’s change is so small compared to expectations that one has to wonder if the government is delaying the bad news as long as it can.

Friday Off-Topic (Moderated) Open Thread (012916)

Filed under: Lucid Links — Tom @ 6:00 am

This open thread is meant for commenters to post on items either briefly noted below (if any) or otherwise not covered at this blog. Rules are here.

Positivity: See What Happened When a Man Who Appeared Homeless Walked Into a Chick-fil-A

Filed under: Positivity — Tom @ 5:55 am

From Murfreesboro, Tennessee, via the Daily Signal:

January 26, 2016

A Tennessee father is crediting Chick-fil-A with helping teach his daughter “life lessons” in his viral Facebook post about a store manager’s kindness toward a man in need.

“I love teaching my daughter life lessons, and I also love being there to watch other Christians teach her life lessons. Thank you, Chick-fil-A, for taking care of the latter today,” wrote Joey Mustain in a post that has been shared over 43,000 times as of Jan. 26.

Mustain said in the post that he was eating at a Chick-fil-A with his daughter Stella when a “homeless traveler” walked in to see if the store could spare “any extra food.” Though “people near him kept their distance,” Mustain said the man was kind and conversational as he waited to speak with the store manager.

Mustain said he and his daughter then witnessed what he described as a “beautiful scene” between the two men, who have yet to be identified.

“All I could pick up on of the conversation was the manager saying that he’d love to give him a full, warm meal—not just scraps or extras—, and the only thing he required was that the man let him pray with him,” wrote Mustain in the Facebook post.

After agreeing to this request, Mustain said “the manager stopped then and there, laid his hand on the man, and proceeded to pray.”

Mustain includes a picture in the post, in which the two men appear to bow their heads together.

“I heard love in that prayer. The homeless man wasn’t some untouchable stain on business. He was the reason that store opened its doors this morning (or any morning),” wrote Mustain.

After explaining to his daughter what was happening, Mustain said “she bowed her head, too.”

“I realized then and there that Chick-fil-A doesn’t simply do business for profits, they truly use business to minister. In a time when companies are trying to win in the market by neutralizing any possibility of offense, CFA is thriving because they unwaveringly cling to their principles and purpose,” said Mustain.

Mustain told The Daily Signal he hopes the attention from the Facebook post will help “bless” Chick-fil-A’s business. …

Go here for the rest of the story.

January 28, 2016

AP Reporters Cite the Same Expert — and Only That Expert — For Comments on Thursday’s Governments Reports on the Economy

The Associated Press may be down to one person in the whole wide world who will tell its economics reporters what they want to hear when the federal government releases economic data. That’s what you almost have to conclude after reading the wire service’s reports on two of Thursday’s major releases, namely last week’s initial unemployment claims and December’s durable goods orders and shipments.

The only outside source AP reporters Christopher Rugaber and Martin Crutsinger consulted in their respective reports about initial claims and durables was one Ian Shepherdson, chief economist with Pantheon Macroeconomics. Naturally, Sheperdson was sunnyside-up despite relatively troubling news in each area.

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