All posts by Dr. ESP

Demand Side Economics

Economics

We hear a lot these days about the effects of inflation on average Americans (whoever they are).  And we see a lot of finger pointing when it comes to the causes.  Greedy corporations.  Supply chain disruptions resulting from the lingering effects of the pandemic.  Federal Reserve policies.  The growing federal debt.  You know what we do not hear.  Anything about the responsibility of consumers to fight inflation.

Despite the fact the current inflation rate remains almost twice the Federal Reserve target of two percent, consumer spending continues to rise.  Which suggests, every consumer could help by following what I call the Dr. ESP “Fight Inflation Now” shopping principles.  Making discretionary purchases only when they are on sale or looking for a less expensive brand substitute or generic alternative.  Let me give you an example based on my most recent purchases at Publix.

  • Every Thursday, Publix publishes a list of BOGO (buy one, get one free) items for the next seven days.
  • Make a list of products you normally buy that are on the list.  Last Friday this included a favorite brand of cereal, Thomas’ bagels, Philadelphia cream cheese, side dishes such as Betty Crocker mashed potatoes and macaroni and cheese, pulled pork BBQ, buns for the BBQ and frozen pizzas.  For perishables, one is consumed immediately while the other is frozen for later use.
  • Next look for sale items, even if the sale price is at or slightly more than you used to pay “in the good old days.”
  • Finally, get the staples (e.g., milk) you need that may not be on sale.

Did it make a difference?  The receipt showed that even though I purchased milk and toilet paper at the retail price, the total bill was $58.67 after a savings of $38.13.  There has been one other side benefit from this system.  By substituting brand names, we have discovered new favorites which have permanently replaced old standards.

Why does the system work?  Instead of supply chain disruptions, consumers create demand chain disruption.  Consider the following.  If consumers follow the Dr. ESP “Fight Inflation Now” principles, prices decline as consumer behavior works its way through the demand chain as follows.

  • Sale items lower the retailers’ revenue, squeezing their already narrow profit margins (especially for grocery stores).
  • Stores will then order less from brokers or produce account representatives whose commissions will suffer.
  • These middle agents will then do one of two things.  Independent brokers will devote their time and energy to higher volume products.  Manufacturers’ product representatives will report decreased sales to the home office.
  • In either case, manufacturers, facing potential loss of market share, will likely reduce prices or offer more promotions.

Can it make a real difference?  I will let Arlo Guthrie answer that question.

You know, if one person, just one person does it they may think he’s really sick and they’ll ignore him. And if two people, two people do it, in harmony, they may think they’re crazy.  And three people do it, three, can you imagine, three people walking into Publix, only buying products on sale and walking out. They may think it’s an organization. And can you, can you imagine fifty people a day, I said fifty people a day walking into Publix, only buying sale items and walking out. And friends they may think it’s a movement. And that’s what it is, the demand side inflation massacre movement.  And all you got to do is follow the Dr. ESP “Fight Inflation Now” process the next time you go into Publix or any other retail store.
For what it’s worth.
Dr. ESP

Not Rocket Science

Politics

If nothing else, Joe Scarborough is consistent when it comes to his schadenfreude over Donald Trump’s promise to his followers, “You will get tired of all the winning.”  Before viewing the following Tweet or tuning into today’s edition of “Morning Joe,” I knew how he would begin his recap of last night’s off-year elections.

He then pointed out why Democratic handwringing over a spathe of weekend polls was premature and why this seventh consecutive poor showing in the only poll that matters (an actual election) does not rest solely on the shoulders of the twice impeached, four times indicted, wannabe autocrat.  However, what he failed to do was explain it in simple enough terms even the leaders of his former party could understand.

There are only two factors which determine an election’s outcome.  The candidate and the issues on which he or she runs.  The sweet spot in politics is an intersection between the two.  However, sometimes the issues don’t matter.  John Kennedy comes to mind.  Analyses of Kennedy’s and Nixon’s 1960 platforms suggest their respective stances on the major issues of the day were almost indistinguishable.  Sometimes it is the nominee who is a non-factor.  Most Americans did not feel any personal affinity to Lyndon Johnson in 1964, but his commitment to carry on Kennedy’s agenda versus the (what  then seemed) extremist views voiced by firebrand Barry Goldwater made LBJ’s brash and often crude persona irrelevant.

Which brings us to the 2024 presidential election.  The Democratic Party will have a nominee who certainly does not make most Americans swoon.  But as we saw again last night, it stands with a majority of American on most key issues.  And when it articulates those positions in a way that resonates with even more Americans, Democrats win. 

Take the extreme example of Kentucky Governor Andy Beshear.  His opponent Daniel Cameron made an issue of Beshear’s veto of what the Associated Press described as “a sweeping Republican bill aimed at regulating the lives of transgender youths that includes banning access to gender-affirming health care and restricting the bathrooms they can use.”  Beshear knew he needed to frame his decision in a way that appealed to (or at least did not offend) the same people who wanted more parental control over the curriculum in their children’s schools.  In his veto message, he said, “This bill allows too much government interference in personal healthcare issues and rips away the freedom of parents to make medical decisions for their children.”  The result?  Beshear’s margin of victory against a Republican touted as an up-and-comer with a future on the national political stage was five percentage points higher than his narrow win four years earlier.

In contrast, the GOP will have a candidate who has an approval rating lower than Joe Biden’s.  In addition, the party’s position on most issues is the polar opposite of that of an overwhelming majority of American voters.  Reproductive rights, gun safety, American democracy and voting rights.  Gay rights.  Separation of church and state.

Any campaign, going into 2024, would prefer to have both an exciting candidate and a platform that resonates with a majority of voters.  But given the current landscape, one party is batting .500 while the other is 0 for 7 since 2016.  Despite the most recent polls, common sense should tell us Biden’s chances are much brighter than they appear.  But as Scarborough suggested on Monday morning, bad polls, regardless how accurate they may be, send the candidate and his campaign a message.  “Work harder!”  The same applies to every individual who dreads a second Trump term.

For what it’s worth.
Dr. ESP

The Fog of Reporting

Media

Following the less than accurate reporting about the explosion at a Gaza City hospital, the mainstream media invoked the phrase “fog of war” to minimize accountability for their rush to judgment. The phrase originally referred to the a military commander’s uncertainty about battlefield engagement based on uncertain information about the on-the-ground situation.  It is now applied to the inability of war correspondents to accurately report what is happening in a war zone.  If you think they learned a lesson from the Al-Ahli Arab Hospital story, you would be wrong.

Based on reporting by all of the major media sources, one might believe that the recently attacked Jabaliya refugee camp is a place where Palestinian civilians sought safety following Israel’s response to Hamas’ October 7 terrorist attack.  Why?  Because, until yesterday, not one print or broadcast outlet had taken time to explain when and why Jabaliya was established.  You might be surprised to learn, as I was, that in 1948 Jabaliya was designated as a refugee camp for Palestinians who were encouraged to leave or expelled from their homes in Israel at the start of hostilities following formal recognition of Israel as the Jewish homeland.  The assumption being that they would be there temporarily, just until the Jewish state was quickly defeated allowing refugees to return to their residences within Israel’s borders under the UN sanctioned partition.

It may have been a tent city in 1948, but that is no longer the case.  It is now one of the most densely populated locations on the Gaza Strip, 1.4 square kilometers housing over 100,000 residents in multi-story apartment buildings.  “Jabaliya Refugee Camp” is more a historical designation than a description of its current status unless you want to call the residents, some who have lived there for three quarters of a century, refugees.

Yesterday, the New York Times, buried at the end of an article titled “In Gazan Neighborhood Hit by Airstrikes, Death and Despair Reign,” finally acknowledged Jabaliya’s history.

Despite its designation as a refugee camp, Jabaliya is a developed community housing Palestinians and their descendants who fled or were expelled from their homes in the 1940s during the conflict that surrounded the creation of Israel.

Jabaliya, Israeli officials say, is a stronghold for the militants.

But it is also a home for the 116,000 Palestinians who are registered to live in the 1.4-square-kilometer area.

They are among millions of Palestinians who are still classified as refugees by the United Nations after decades of exile. Israel, which bars Gazans from returning to the land they were expelled from, objects to the U.N. definition of Palestinians as refugees in general.

Media sources have multiple reasons to avoid again jumping to conclusions. Pictures of the still-standing structures from Jabaliya confirm Jabaliya is no makeshift refuge. The fact that many buildings remain erect right next to targeted structures suggests the Israel Defense Force (IDF) has focused on strategic targets.  Plus the IDF acknowledgement of responsibility for the bombings indicates they believe there were legitimate military targets.

Civil War General William Sherman was right when he said, “War is Hell.”  Every civilian death should be mourned.  But there is a difference between collateral damage and terrorism.  There is no question about which took place on October 7.  To determine the extent to which Israel conducted its response in accordance with the international rules of combat cannot and should not be determined now, veiled in the fog of war or media coverage.

Other history about the Gaza Strip also needs retelling, especially the unexpected proposal by former Israeli Prime Minister Ariel Sharon to disengage from Gaza, initiated in 2003 and implemented in 2005.  This included both unilateral relocation of 80,000 Israeli settlers against their will and the turnover of administrative responsibility and governance to the Palestinian Authority.  But that is a story for another day.

For what it’s worth.
Dr. ESP

Terrorism Works

Politics

At first it was just aberrant behavior.  One can argue it began with Richard Nixon and his 1972 re-election campaign’s “dirty tricks.”  Their success by bending the rules is best described by Mark Felt (aka Deep Throat) in the film All the President’s Men. based on Bob Woodward’s and Carl Bernstein’s book of the same title.

Nationwide–my God, they were frightened of Muskie and look who got destroyed–they wanted to run against McGovern, and look who they’re running against. They bugged, they followed people, false press leaks, fake letters, they canceled Democratic campaign rallies, they investigated Democratic private lives, they planted spies, stole documents, on and on– don’t tell me you think this was all the work of little Don Segretti.

Fast forward to October 3, 2023, the day House Speaker Kevin McCarthy was voted out of office by eight members of the Freedom Caucus, a subset of the larger group which forced 15 floor votes before McCarthy obtained the speakership.  As early as January 3, 2023, more pragmatic members of the GOP caucus referred to the dissenters as the “Taliban 19.”  This was nothing new.  Former Speaker John Boehner once referred to the Freedom Caucus as “legislative terrorists.”  After the chaotic attempts to replace McCarthy, it is hard to disagree.

More importantly, the self-proclaimed leader of the MAGA wing of the GOP House considered these descriptors a call to arms.  According to POLITICO.COM, “Rep. Mat Gaetz (R-FL) called the comments ‘hurtful’ and ‘false,’ though he added, ‘I too am prepared for an extended battle I will ultimately win.'” On October 24, 2023, win he did with the ascension of Mike Johnson (R-LA) to Speaker of the House.  Neither Gaetz or Marjorie Taylor Greene could ever dream the House gavel would be wielded by such a Trumpy, election denying, America First, homophobic Christian nationalist who explains his guiding principle as follows. 

Someone asked me today in the media, “People are curious, what does Mike Johnson think about any issue under the sun?” I said, ‘Well, go pick up a Bible off your shelf and read it. That’s my worldview.”

Imagine the response by every one of the 220 GOP members of Congress who voted for Johnson if an Irani Ayatollah said, “What do I think about any issue under the sun?  Go pick up the Koran and read it.  That’s my worldview.”

Now that Gaetz, et. al., have demonstrated terrorism works, you can bet the farm this is not the last time they will use it.

POSTCRIPT–Election Deniers

If you think the 2020 “Big Lie” was a one-off or it only applies to inter-party contests, look no farther than the eventual choice of Mike Johnson as Speaker of the House.  Until last Tuesday, the rule which governed GOP caucus votes, named after former Speaker and convicted pedophile Dennis Hastert, though not specifically stating such, implies that the members of the party will abide by the wishes of a majority of the total GOP conference.

On October 11, the conference nominated Majority Leader Steve Scalise as the party’s choice for speaker.  The secret ballot vote was 113 for Scalise and 99 for Jim Jordan.  The MAGA wing of the GOP conference, however, refused to accept the outcome.  When Scalise withdrew his nomination two days later, the conference nominated Jim Jordan over seven other contenders using (drum roll) ranked voting, something the RNC opposes for national elections.  Again the losers failed to fall in line, denying Jordan the 217 votes on the House floor to secure the gavel.  The conference then nominated Tom Emmer by a vote of 117 to 97.  Within four hours (what one pundit referred to as a tenth of a Scaramucci), Donald Trump torpedoed Emmer’s nomination  because he refused to go along with the Big Lie.

Only after Johnson received 128 votes in  last Tuesday’s secret ballot, just 57.9 percent of the 221 GOP conference members, his supporters declared victory and demanded the entire GOP membership get behind him.  One more example the GOP continues to believe the only legitimate elections are those in which their candidates prevail.

For what it’s worth.
Dr. ESP

 

Daddy Issues

Culture, Media

You ask me what I’m thinking aboutI tell you that I’m thinking aboutWhatever you’re thinking aboutTell me something that I’ll forgetAnd you might have to tell me againIt’s crazy what you’ll do for a friend

~”Daddy Issues” by The Neighbourhood

Just when you thought there was the slightest possibility Republican “Team Sane” might eventually land the ship safely on Earth One, it’s leader former Wyoming Representative Liz Cheney proved that once Donald Trump is gone, it will be back to business as usual.  On what do I base this pessimistic view of a functioning two-party democratic system?  Her interview with Jake Tapper on the October 22 edition of CNN’s “State of the Union.” After an opening segment on the importance of plea deals by Sydney Powell and Kenneth Chesebro on Trump’s legal peril and Jim Jordan’s secret ballot reality check, Tapper turned to the Israel-Hamas War.

TAPPER: Let me ask you, just in terms of advising a country that is an ally — a lot of people are drawing parallels to 9/11, although, proportionally, this was worse. This is about — would be the same as killing 40,000 people in Israel, as opposed to 3,000 that happened here in 9/11.

On 9/11, your father was vice president. You came to work at the State Department after 9/11. Take a listen to what President Biden said in Israel this week.

VIDEO CLIP OF BIDEN: But I caution this: While you feel that rage, don’t be consumed by it. After 9/11, we were enraged in the United States. And while we sought justice and got justice, we also made mistakes.

TAPPER: Given the goal of not just defeating Hamas, but a long-term goal of Israel living in peace, of a two-state solution, if that’s even a serious proposition anymore, what lessons do you think we have learned as a country that we could tell Israel, that we could share with Israel?

CHENEY: Well, look, I think probably the biggest mistake that we made post-9/11 was President Biden’s decision to withdraw from Afghanistan the way that he did.

Leave it to Daddy’s little girl to conveniently skip over the 2003 invasion of Iraq.  You know, the conflict predicated on what we once thought was “the BIG lie” until Trump came up with “a BIGGER lie.” Actually it was two lies:  Saddam Hussein’s involvement in the 9/11 terrorist attack (not true) and his imminent development and potential use of weapons of mass destruction against the United States (also not true).

We can all agree the withdrawal from Afghanistan did not go as planned largely due to the fact that no one expected the Kabul government and military forces to surrender to the Taliban within days, if not hours, of the start of the evacuation.  At a time when some Americans are questioning continued support for Ukrainians who are fighting and dying in defense of democracy, they seem to forget we provided 20 years of both American treasure and lives for a regime that showed no interest in standing up for itself.  Since the U.S. withdrawal, Afghanistan, though ruled by the Taliban, has not been a credible terrorist threat to our homeland.  They have enough problems to deal with governing their own country.

Compare that to the consequences of the 2003 Iraq invasion. 

  • A total of 4,492 U.S. members of the arm services killed and another 32,292 wounded. 
  • Direct funding of more than $750 million.  Estimates of indirect costs at home and abroad raise that total to $3 trillion.
  • An ISIS resurgence in the region.
  • War profiteering of which the major financial beneficiary was Haliburton (you know, “Daddy’s corporation”) which received $39.5 billion in federal contracts during the conflict.

Perhaps the most devastating unintended consequence of the Iraq invasion was the removal of the single most efficient counter-balance to the rise of Iran.  After eight years of armed conflict between Iraq and Iran beginning in 1980, the Iranian clerics agreed to a U.N. brokered cease-fire.  According to a 2016 report by Satgin Hamrah of the Fletcher Forum of World Affairs, “While the war may have ended in 1988, its legacy lives on in the Sunni versus Shia sectarian conflicts that currently exist in much of the Muslim world.”  Without Hussein’s presence to ensure a strong Sunni counter to the Iranian Shia theocracy, the threat to America is significantly higher than it was pre-2003. According to a 2022 assessment by the Council on Foreign Affairs:

Iran has built considerable political clout in Iraq since the fall of Saddam Hussein’s regime. Its wide sphere of influence could be expanding, raising domestic tensions and alarming U.S. policymakers.

When the GOP accuses the Biden Administration of enabling Iran’s rise as a global menace, politely remind them who created the opportunity by removing their preoccupation with a hostile next door neighbor.

POSTSCRIPT

The other piece of news coming out of the interview was Cheney’s announcement she had not ruled out a possible run for the presidency.  My first thought?  She will not have to worry about campaign financing.  Certainly, she can self-fund her campaign with Daddy’s literal “war chest.”

For what it’s worth.
Dr. ESP