Friday, March 24, 2017
Economic Shocks are More Likely to be Lethal in America
This article discusses that Americans without college educations have suffered financially for decades. However, in more recent times, there has actually been an increase in the middle-aged white morality rate. This has been increasing since 1999. The mortality rate of middle-aged white Americans is much higher than other countries such as France, Britain, Australia, Canada, Sweden, and Germany. In every five-year cohort of whites born since the 1940s, deaths from drugs, suicides, and alcohol have increased respectively. This is a clear issue. Recent trends in the income of households headed by white 50-54-year-olds mirror their mortality rates. It is suspected that income decreases and economic shifts such as decreased manufacturing job opportunities have played a large role in this epidemic. This seems to be a very complex issue that will be difficult to solve.
Monday, March 20, 2017
Globalization is facing a 're-calibration,' says Dow Chemical chief
According to the article, because President Donald Trump began to implement his policy on bringing manufacturing back to America, the process of globalization is under adjustment which is also called "recalibration" by the Dow Chemical chief, Andrew Liveris. America has been a consumption economy after the World War II which means people can import almost anything and sell them in any retail environment or channel while there is actually no much incentives to invest. On the contrast, almost all the other economies are investment economies and even Europ has protections around the economy. Becuase America has paid much attention to the consumption, manufacturing based in America has lost the advantage of job creation.
It would be interesting to see how the policies implemented by Trump can attract more investment. I'm looking forward to seeing what further policy would be issued to protect investment. Also, as America trying to get manufacturing back, this would definitely affect its import and the export of other countries. What is more, as the article mentioned, this adjustment might bring America to a level-playing field with other countries and probably, the America-centric would be the real future issue.
http://www.cnbc.com/2017/03/20/china-development-forum-globalization-is-facing-a-re-calibration-says-dow-chemical-chief.html
It would be interesting to see how the policies implemented by Trump can attract more investment. I'm looking forward to seeing what further policy would be issued to protect investment. Also, as America trying to get manufacturing back, this would definitely affect its import and the export of other countries. What is more, as the article mentioned, this adjustment might bring America to a level-playing field with other countries and probably, the America-centric would be the real future issue.
http://www.cnbc.com/2017/03/20/china-development-forum-globalization-is-facing-a-re-calibration-says-dow-chemical-chief.html
The Progressive Case for Immigration
Just as the title suggests, this article discusses the affects of immigration. In reality there are many positives for have immigrants. There is a common belief that immigrants hurt the wage level for natives with a similar skill set. In fact, data suggests that natives will be pushed more to war a specialized skill and then will earn a higher wage. Additionally, in countries where there is an aging population, migrants tax payments help fund th natives' pensions. With more people joining a society, it also leads to new ideas and potentially new businesses in their new home country. Immigrating to a country like the US also gives a worker a boost in the value of the work they complete-no matter their occupation. Suddenly, workers earn 2.5 times more than they would have in their home country.
This article also discusses the arguments against two other arguments against immigration 1) the countries which they leave should industrialize and 2) "migrants might taint their new homes with a residue of the culture of their countries of origin". The author explains that the growth in China that we have seen to create an industrialized nation is unlikely to happen again. Especially since the cost of automated manufacturing is getting lower and lower. There have also been downward trends in the wages earned for manufactured labor. So, industrialization won't have the same positive effects that we've seen historically. Additionally, the idea that migrants' culture would taint the home culture is ridiculous, especially in a place like the United States which is founded on the "melting pot" or "salad bowl" of everyone's cultures coming together to create free flowing ideas and discussions.
https://www.economist.com/news/finance-and-economics/21718873-whatever-politicians-say-world-needs-more-immigration-not-less
This article also discusses the arguments against two other arguments against immigration 1) the countries which they leave should industrialize and 2) "migrants might taint their new homes with a residue of the culture of their countries of origin". The author explains that the growth in China that we have seen to create an industrialized nation is unlikely to happen again. Especially since the cost of automated manufacturing is getting lower and lower. There have also been downward trends in the wages earned for manufactured labor. So, industrialization won't have the same positive effects that we've seen historically. Additionally, the idea that migrants' culture would taint the home culture is ridiculous, especially in a place like the United States which is founded on the "melting pot" or "salad bowl" of everyone's cultures coming together to create free flowing ideas and discussions.
https://www.economist.com/news/finance-and-economics/21718873-whatever-politicians-say-world-needs-more-immigration-not-less
Economists argue about the impact of Chinese imports on America
The article looks at the different arguments regarding the effects of the trade relationship with China. At first, it takes a look at the works of David Autor, David Dorn and Gordon Hanson who have found in their research that in the 17-year-period between 1997 and 2007, "a quarter of the loss in manufacturing jobs can be attributed to a surge in Chinese imports."
Then the article looks into the counter argument put forth by Jonathon Rothwell where he contests the method of measurement and notes that splitting the time period shows that there is a significantly smaller effect on the labor force (which is flawed in itself since it is a smaller sample size). Rothwell also speaks about how there are so many factors like monetary policies and individual incomes that might have been different without this surge of imports and that there are too many other variables at play here to entirely blame Chinese imports for all these issues.
He also criticizes the aforementioned research for not taking into account the benefits that had come with this "China shock" noting the lower prices and the rise in American and Chinese consumer incomes.
Then the article looks into the counter argument put forth by Jonathon Rothwell where he contests the method of measurement and notes that splitting the time period shows that there is a significantly smaller effect on the labor force (which is flawed in itself since it is a smaller sample size). Rothwell also speaks about how there are so many factors like monetary policies and individual incomes that might have been different without this surge of imports and that there are too many other variables at play here to entirely blame Chinese imports for all these issues.
He also criticizes the aforementioned research for not taking into account the benefits that had come with this "China shock" noting the lower prices and the rise in American and Chinese consumer incomes.
Although Rothwell's argument falls a little short when it comes to the numbers with the smaller sample size, there is something to be said about his concern about the variables and benefits not considered by the authors of the works being criticized. Sure, losing manufacturing jobs makes an economic dent but if on the other hand, US-based multinational corporations are building their profits off of this cheap labor then there are more than enough returns coming back to the US economy. Also given that American consumers are being able to buy cheap goods and services due to the cheap production means in China is certainly a benefit of this trade relationship that should not be completely ignored. The article notes how the excess of workers from the lost manufacturing jobs was not soaked up by other sectors but is should China really be blamed for that? If the US were to have better retraining programs or more government initiated employment facilities perhaps this number could have been reduced further.
Rather than alienating people against globalization (with all of its comparative advantages and push for efficiency) the United States really needs to focus on either becoming more efficient (and providing goods at the same rate as China) or being better at helping the people who lose out in the bigger gains.
Egypt's economy shows signs of life
Last year it seemed that Egypt's government, lead by the authoritarian Abdel-Fattah al-Sisi, was losing control of the country. However, through a series of economic reforms such as allowing the Egyptian pound to float and lowering government subsidies for oil and electricity. Egypt has generally been weary of letting its currency float, instead opting fro a fixed pound that was too high for foreign investment. with this floating currency, Egypt has seen foreign investment boost in the last year due to this reform with $4 billion of investment in government bonds in January.
However, while these reforms have brought back some foreign investment, Egypt has continued to see a disturbing decline in its domestic market. Because of the drop in government subsidies the Egyptian people must now put more of their money into these kinds of expenditures rather than in firms that they otherwise would have been able to buy goods and services from. Buying goods and services for domestic consumers is also getting quite difficult because of the inflating currency due to the floating pound. For example, the juice and dairy producer, Juhayna, has seen its profits for the third quarter of 2016 drop by 34% from what it was at the same time the previous year.
Will the government's focus on foreign investment pay off before the "bitter medicine" becomes too hard to take for Egyptian firms and the Egyptian people?
http://www.economist.com/news/middle-east-and-africa/21718552-bitter-medicine-starting-work-egypts-economy-shows-signs-life
However, while these reforms have brought back some foreign investment, Egypt has continued to see a disturbing decline in its domestic market. Because of the drop in government subsidies the Egyptian people must now put more of their money into these kinds of expenditures rather than in firms that they otherwise would have been able to buy goods and services from. Buying goods and services for domestic consumers is also getting quite difficult because of the inflating currency due to the floating pound. For example, the juice and dairy producer, Juhayna, has seen its profits for the third quarter of 2016 drop by 34% from what it was at the same time the previous year.
Will the government's focus on foreign investment pay off before the "bitter medicine" becomes too hard to take for Egyptian firms and the Egyptian people?
http://www.economist.com/news/middle-east-and-africa/21718552-bitter-medicine-starting-work-egypts-economy-shows-signs-life
Sunday, March 19, 2017
Work requirement for the poor, tax credit boost in the works for health plan, House Speaker Ryan says
I think that this article was an interesting read because healthcare is a big topic in the news and with this reform it could change alot! It will be interesting to see how the public takes some of these changes like the poor having to have a job in order to get the full medicade benefits! I also read that Trump is planing on raising the price that people are going to have to pay for Medicare which many people are struggling to pay the price now. There could be some backlash to these decisions and only time will tell.
Link: http://www.cnbc.com/2017/03/19/us-republicans-working-on-medicaid-tax-credit-changes-paul-ryan-says.html
The Fed Acts. Workers in Mexico and Merchants in Malaysia Suffer.
The peso is
a currency that has been losing value as the Fed stated that it plans on
raising interest rates this year. A shift in the global economy is affecting
millions of people and as rates continue to rise, it adds momentum to a stream
of money that has been leaving emerging markets and moving toward the US. Foreign economies, which are trying to develop,
are becoming weaker and currencies are falling.
It is almost as families are taking large pay cuts and can afford less
and less and some cannot afford much to begin with. People are starting to leave factories and go
back to their home towns.
Most economist believe that the predicted
rate increases will be far less than expected, but many emerging countries have
created large reserves of dollars in order to protect themselves against a
significant drop in their currencies.
One county that has already seen a significant impact is Turkey. Their currency has dropped 25% against the
dollar since May, and their reserves are low.
It will be interesting to see how this all works itself out. Some countries are vulnerable at the moment
and possible trade wars with the US need to be avoided at all costs.
Link: https://www.nytimes.com/2017/03/16/business/federal-reserve-interest-rates-china-mexico.html?ref=business
Untold Suffering: Hundreds of Thousands of People Have Fled South Sudan for Uganda
In the beginning of the month, refugees from South Sudan flooded into the borders of Uganda as a civil war broke out between the president's, Salva Kiir, forces and the vice president's, Riek Machar, forces broke out. Of course, South Sudan has had issues since its independence in 2013, and peace agreements have been temporary bandages to deeper rooted conflict. The conflicts have driven toward ethnic cleansing; the government has been accused of "population engineering to redraw the country's ethnic map."
With war comes economic troubles. Famine was declared in February, inflation topped 50% each month (though it has lowered), and the currency collapsed. Refugee camps can no longer accommodate the huge influx of migrants, and the ability to continue the system teeters on failure. Uganda has been a unique exception and example for accepting refugees. Their success is attributed to their leaders' good attitude toward refugees. Families who arrive in refugee camps are given plots of land to farm, and services such as schooling, clinics, and markets.
For such a large acceptance rate of refugees, and not known for its wealth, Uganda sheds an interesting light on the "refugee crisis crisis" that has been affecting the world. Are European countries economically unable or unwilling to accept refugees? Has the mentality of inclusiveness and accommodation that Europe seemed to fight for really exist?
"Untold Suffering: Hundreds of Thousands of People Have Fled South Sudan for Uganda." The Economist. The Economist Newspaper, 17 March 2017.
With war comes economic troubles. Famine was declared in February, inflation topped 50% each month (though it has lowered), and the currency collapsed. Refugee camps can no longer accommodate the huge influx of migrants, and the ability to continue the system teeters on failure. Uganda has been a unique exception and example for accepting refugees. Their success is attributed to their leaders' good attitude toward refugees. Families who arrive in refugee camps are given plots of land to farm, and services such as schooling, clinics, and markets.
For such a large acceptance rate of refugees, and not known for its wealth, Uganda sheds an interesting light on the "refugee crisis crisis" that has been affecting the world. Are European countries economically unable or unwilling to accept refugees? Has the mentality of inclusiveness and accommodation that Europe seemed to fight for really exist?
"Untold Suffering: Hundreds of Thousands of People Have Fled South Sudan for Uganda." The Economist. The Economist Newspaper, 17 March 2017.
China lashes out as South Korea puts an American anti-missile system in place
The U.S. Terminal High Altitude Area Defense system
(THAAD) deployed to South Korea earlier this month and while the missile-muting
shield is meant to keep North Korean nuclear ambitions in check it is also
driving the Chinese to distraction.
Beijing sees THAAD as an escalation against their own missile forces and
have argued and fought against the system’s deployment since the idea was
broached as North Korea began slinging its rockets farther.
Consequently, the campaign against South Korea's Lotte Group and other South Korean companies is an example of
how quickly political tides can shift in China. As of March 8, some 40 Lotte
stores had been closed, often on spurious grounds such as alleged fire-code
violations.
Lotte's troubles
expanded to other South Korean firms on Thursday as China's tourism ministry
instructed tour operators in Beijing to stop selling trips to South Korea from
March 15. The order has since spread to other regions across the mainland, an
official at Korea Tourism Organization said on Monday.
If you're older and lower income, prepare to pay more under GOP health bill
http://money.cnn.com/2017/03/13/news/economy/cbo-premiums-republican-health-care-plan/index.html?iid=hp-stack-dom
The republicans proposal to replace Obamacare has faced harsh criticism and rightfully so. The GOP's health care act would potentially raise the premium for a 64 year old by around 25%. Refundable tax credits will not be as generous as they were under Obamacare and this could lead to older people feeling a significant economic difference.
It was estimated that a 64 year old making around $25,000 a year would pay $1,400 under Obamacare, but this number would spike to $14,000 under the new proposed bill. People believe that by 2019, these premiums will start to decline and by 2026, would be 10% lower than they are under the current system. It is believed that these numbers are misleading as they will lower the cost for younger folk, but would significantly effect older Americans. This new proposed healthcare would benefit people that do not qualify for Obamacare (earning $64,000+) as it would lower the premium from $14,600 to $13,500. Lastly, it will be interesting to see the effects of the proposed bill in the long run and whether or not it has a significant positive or negative impact on the economy.
The republicans proposal to replace Obamacare has faced harsh criticism and rightfully so. The GOP's health care act would potentially raise the premium for a 64 year old by around 25%. Refundable tax credits will not be as generous as they were under Obamacare and this could lead to older people feeling a significant economic difference.
It was estimated that a 64 year old making around $25,000 a year would pay $1,400 under Obamacare, but this number would spike to $14,000 under the new proposed bill. People believe that by 2019, these premiums will start to decline and by 2026, would be 10% lower than they are under the current system. It is believed that these numbers are misleading as they will lower the cost for younger folk, but would significantly effect older Americans. This new proposed healthcare would benefit people that do not qualify for Obamacare (earning $64,000+) as it would lower the premium from $14,600 to $13,500. Lastly, it will be interesting to see the effects of the proposed bill in the long run and whether or not it has a significant positive or negative impact on the economy.
As Uber Woos More Drivers, Taxis Hit Back
This article started with comparing the center serving drivers of New York's yellow taxis and the center serving the Uber drivers in the city. The center for Uber drivers is on the higher end comparing to the one for the yellow cab drivers. Uber, Lyft and other similar services offer consumers convenient and sometimes cheaper options. Since the demand for these ride-hailing services is increasingly high, the competition for drivers is intense. However, the series of fare cuts that Uber offers had drawn protests from drivers, who say it makes it difficult for them to make enough income. Uber was also sued by some drivers trying to get health insurance and other employee benefits.
Despite the conflicts happened between Uber and its drivers, Uber is still the winner over yellow cabs. The taxi companies are forced to embrace new ways to get its foot back on the ground. There comes a dilemma for the drivers: should they stay with a taxi industry that has been a fixture of New York life for over a century or should they join the ranks of the ride-hail apps that are "reshaping the city's transportation landscape"? The yellow-cab drivers are feeling more wanted because the industry has been trying hard to lure new workers and customers, which was completely different before Uber, Lyft existed. Yellow cab drivers did not get much help for the taxi center and were treated unfairly sometimes. Now since the taxi industry reformed some of its policy, the center had served more drivers than before. The drivers are walked through each step of the licensing and renewal process. They also receive free training classes which cost more than $150 before.
I personally would like to support taxi companies. But the features that Uber and Lyft offer make it impossible for me to prefer a taxi. These ride-hailing apps are just way more convenient and save me lots of waiting time trying to get an empty cab by the side of the street. And I feel safer riding Uber and Lyft because I can easily report a driver on my phone. When the taxi companies can offer similar features like Uber, I think I would use cabs again, because I respect their long history of serving customers.
Link to article: https://www.nytimes.com/2017/03/18/nyregion/nyc-taxi-center-uber.html?ref=business
Despite the conflicts happened between Uber and its drivers, Uber is still the winner over yellow cabs. The taxi companies are forced to embrace new ways to get its foot back on the ground. There comes a dilemma for the drivers: should they stay with a taxi industry that has been a fixture of New York life for over a century or should they join the ranks of the ride-hail apps that are "reshaping the city's transportation landscape"? The yellow-cab drivers are feeling more wanted because the industry has been trying hard to lure new workers and customers, which was completely different before Uber, Lyft existed. Yellow cab drivers did not get much help for the taxi center and were treated unfairly sometimes. Now since the taxi industry reformed some of its policy, the center had served more drivers than before. The drivers are walked through each step of the licensing and renewal process. They also receive free training classes which cost more than $150 before.
I personally would like to support taxi companies. But the features that Uber and Lyft offer make it impossible for me to prefer a taxi. These ride-hailing apps are just way more convenient and save me lots of waiting time trying to get an empty cab by the side of the street. And I feel safer riding Uber and Lyft because I can easily report a driver on my phone. When the taxi companies can offer similar features like Uber, I think I would use cabs again, because I respect their long history of serving customers.
Link to article: https://www.nytimes.com/2017/03/18/nyregion/nyc-taxi-center-uber.html?ref=business
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