Tuesday, September 22, 2020

The Supreme Court. Gender? Race? Enthnicity? Catholicism 7, Judaism 2, all other religions 0?

In a post here on July 7, 2018 titled More is at risk than abortion and gay marriage: California must protect itself from the rise of "A Handmaid's Tale" theonomist judiciary the subtle risk of the current and future Supreme Court makeup was extensively noted. We will not repeat that long post, but rather refer readers to it while offering the following chart:

In that 2018 post it was noted:
Contrary to everything I understand about religion vis-à-vis the Judicial Branch within the Union is reflected in this from Wikipedia:
   Of the 114 justices who have been appointed to the court, 91 have been from various Protestant denominations, 12 have been Catholics (one other justice, Sherman Minton, converted to Catholicism after leaving the Court). Another, Neil Gorsuch, was raised in the Catholic Church but later attended an Episcopal church, though without specifying the denomination to which he felt he belonged.
    At the beginning of 2010, Justice John Paul Stevens was the sole remaining Protestant on the Court In April 2010, Justice Stevens announced his retirement, effective as of the Court's 2010 summer recess. Upon Justice Stevens' retirement, which formally began on June 28, 2010, the Court lacked a Protestant member, marking the first time in its history that it was exclusively composed of Jewish and Catholic justices. Although in January 2017, after seven years with no Protestant justices serving or nominated, President Donald Trump nominated Neil Gorsuch to the Court, as noted above it is unclear whether Gorsuch considers himself a Catholic or an Episcopalian.
    This development led to some comment. Law school professor Jeffrey Rosen wrote that "it's a fascinating truth that we've allowed religion to drop out of consideration on the Supreme Court, and right now, we have a Supreme Court that religiously at least, by no means looks like America".

Yes, Professor Rosen, it's fascinating...and endangers our freedom.

Wednesday, September 16, 2020

California (and the nation?) fading into the ashes...

The above graphic appeared in the July 19, 2009, post here Fading Into the Ashes  in which a fear was expressed:

Once known for its economic opportunities, for its schools and higher education system, and for its commitment to the social compact, California is fading into the ashes, the ashes from wildfires and the ashes from Californian's burning through their wealth.

Wildfire season is underway now. Maybe it won't be as bad as the past few years or as expensive.

On January 11, 2012, in the post The Golden State to become The Brown State: The 5-Year Plan the following warning was offered:

Next we have the spin on reducing the cost of CAL FIRE:

Under this proposal, responsibility for fire protection and medical emergency response in these populated wildland areas will be assumed by local government. As a result, this proposal will ensure that local jurisdictions making land use decisions which result in housing development encroaching in wildland areas are also responsible for providing the necessary emergency response services associated with more highly populated land use patterns.

...It is estimated that this proposal will result in the realignment of up to $250 million of CAL FIRE’s fire protection program to local governments.
This would have been a thoughtful, significant proposal thirty years ago, back in 1981 in Brown's first stint as Governor. But since then, thousands of homes have been built in the urban-forest interface. They aren't going away (unless they burn down).

The entire budget for the Department of Forestry and Fire Protection is/has been around $750 million. The Brown proposal is to shift a third of that budget to local fire departments with some funding for five years.

The problem with that theory is that local agencies are not in a position to contract for helicopters and other aircraft. What will happen is that many more fires will get away from under-equipped local firefighters in that urban-forest interface area, moving into the state responsibility areas, making it significantly harder for a later response of CAL FIRE units to suppress creating a corresponding cost increase to the state.

The whole program will take several years to implement. I assume Brown hopes it will be at least five years before anyone notices the wildfire damage problem.

Those are the two earliest of the 11 posts here that discussed the wildfire problem.

And it was "at least five years" from 2012 before the public started to notice the wildfire damage problem. As noted in Wikipedia: "In terms of property damage, 2017 was the most destructive wildfire season on record in California at the time, surpassed by only the 2018 season,"

The year 2020 is the year California finally ran into the firefighting wall - a shortage of firefighters and equipment, a shortage of money. The year 2020 has been the largest wildfire season recorded in California history, but since the peak of the wildfire season usually occurs between July and November we won't know just what "largest" will mean.

State and local government were already facing a financial crisis because of Covid-19. The fire fighting costs will exacerbate that. And the fires will compound the economic impact of the pandemic.

On January 12, 2019, John Poimiroo, California’s former state tourism director and an active outdoor and travel writer, wrote in The San Francisco Chronicle Why wildfires pose an existential threat to California tourism. Of course, in the middle of the 2020 Covid-19 pandemic, it may be difficult for those who depend on tourism for a livelihood to focus also on the wildfire problem. But the article began by quoting then-Governor Jerry Brown from a November 11, 2018 news conference:

    “New abnormal” was the expression Brown used when describing the spate of recent wildfires that have decimated the state. He predicted they will intensify and continue for the foreseeable future. “We have a real challenge here, threatening our whole way of life,” Brown said at a press briefing in November during the Woolsey and Camp fires.
    Between 1984 and 2010, the number of wildfire acres that burned at high intensity rose by 50 percent, and more than 60 million dead trees remain in the state's forests, according to the Sierra Nevada Conservancy, a state agency focused on conservation efforts.
    “Right now, the Sierra Nevada region is at a critical point. A century of fire suppression, a shortage of restoration efforts and years of drought have placed Sierra forests ... at incredible risk,” according to the conservancy.
    Has the ever-expanding wildfire season brought about, as Gov. Jerry Brown has suggested, a “new abnormal” for California travelers? The short answer is yes.
    Between 1984 and 2010, the number of wildfire acres that burned at high intensity rose by 50 percent, and more than 60 million dead trees remain in the state's forests, according to the Sierra Nevada Conservancy, a state agency focused on conservation efforts.
    “Right now, the Sierra Nevada region is at a critical point. A century of fire suppression, a shortage of restoration efforts and years of drought have placed Sierra forests ... at incredible risk,” according to the conservancy.
    What this means for California travelers is that the places we go and the things we love to do in the outdoors may be suffocated long term, not just during the ever-expanding fire season.
    Welcome to the new abnormal.

In the fall of 2019 which followed Poimiroo's article we read Kincade Fire’s destructive toll on Sonoma wineries, vintners which emphasizes the impact on just one industry - wine production and sales - which does involve tourism among other sources of revenue. But what most don't think about is wineries 'quietly dumping a smoke-tainted vintage."

Of course, the fires of 2017, 2018, 2019, and 2020-to-date destroyed an estimated 20,000 homes worth about $6 billion. This has created 60,000± homeless people whose real and personal property asset value depends entirely on insurance companies. In communities like Paradise, the place of employment of those people was destroyed by the fire, literally or as a side effect.

It is probable that Covid-19 will be addressed within a year with vaccines. But as Jerry Brown said just before he passed the Governor baton to Gavin Newsom, wildfires were the "new abnormal" in California - except they are the new normal.

We've had to suffer the specter of President Trump talking about California not maintaining their wildlands. This year to date more than 1.1 million acres have burned on federal lands in California, compared to 769,032 acres on non-federally managed lands. That's 59% on federal lands which, as can be seen on the chart to the left, is consistent with the share of wildland owned by the federal government.

With that said, for decades environmental groups in California have been fighting over proper maintenance of wildlands, fighting with timber companies and, most importantly, have been blocking federal decision-making. Keep in mind that the State of California and its political subdivisions own 3% of the land - comparatively not much raking involved, Donald.

The fact is right now the feds and the private sector together control 95% of California's forest lands.

But CalFire and local fire districts bear the brunt of the fire fighting to protect people and property.

The critical question now is how the private sector, State government, and local governments are going to survive the combined impact of Covid-19 and wildfires that have occurred during Donald Trump's Administration.

As noted here in 2009, California is fading into the ashes. Don't expect Google or Facebook to offset a potential collapse of California's economy. And remember: "As California goes, so goes the nation."

Monday, September 7, 2020

The American labor movement, Labor Day, and the Wealthiest 1%: Continuing ignorance makes losers

If you check your TV schedule for Labor Day weekend, you won't find an annual PBS show recognizing American workers. Nor will you find any national broadcast coverage of parades or fireworks or memorial day type ceremonies honoring workers who died advocating labor causes.

But then again, you won't see either Bernie Sanders or Donald Trump leading a celebration despite the fact that angry American workers were their base of support.

The American Labor Day Holiday was literally given to you to smooth over the killing of American workers on strike by U.S. Government officials. In 1894, President Grover Cleveland pushed Congress to establish the holiday as a way to reduce class tension following the Pullman Strike. During that strike thousands of United States Marshals and 12,000 United States Army troops were called out to suppress the strike and about ninety workers were gunned down.

Cleveland’s choice to establish Labor Day in September deflected attention away from another explosive labor action — the Haymarket massacre of 1886, where the deaths of American workers did contribute at least one lasting legacy to the international movement for working-class liberation — a workers’ holiday, May Day, celebrated around the world on May 1.

Tied to the socialist movement, May Day as a national holiday was unacceptable to the American Establishment of the late 1800's. But a response from the Government over the Pullman Strike deaths was needed, so Cleveland selected what we now celebrate as Labor Day in the hopes that working Americans would be mollified and someday forget the labor movement.

But that didn't happen rapidly. Thirty years later, in 1916, Congress passed the Adamson Act creating the first legally enshrined eight hour work day in order to avoid a nationwide railroad strike which would have resulted in deaths.

It would take years before most Americans would forget about the meaning of Labor Day - after The Great Depression, beyond the Revolutionary 1960's, really all the way to the 1980's when the Industrial Revolution was replaced by the Digital Revolution.

During the 1980's decade most Americans seem to have decided they had nothing in common with the laboring class, had no need for organized labor, and literally raised a generation that thinks Labor Day exists for stores to sell stuff much like the Valentines Day "holiday."

To learn a little more about the history of Labor Day you can read When Labor Day Meant Something and  Labor Day is May 1, today is a boss’s holiday, though you should learn a lot more about what the labor movement struggled to secure for you though that would require reading books. You should at least be aware that there is a Wikipedia entry List of worker deaths in United States labor disputes.

Or you could embrace your ignorance, sit back and enjoy an NPR Jazz Sampler Labor Day Blues And Grooves.

Just keep in mind that the 1% depend upon most workers not understanding that laws like the minimum wage, mandatory overtime, etc., exist not because of some benevolent President but because of the American labor movement. There has always been the 1%, but there isn't much of a labor movement now. Some thoughtful folks might wonder if there is any relationship between that and who benefits from the economic growth....

This post was originally posted in 2016. In 2020 it seems more important than ever to encourage people to think about what benefits the labor movement gave us, beginning with the 8-hour day. Unfortunately, businesses have been allowed to ignore 8-hour day laws by paying a fixed salary and calling workers "professionals" when, in fact, the term means "following an occupation as a means of livelihood or for gain" and union plumbers are professionals paid by the hour.

Friday, September 4, 2020

The economy, Il Duce. Trump stirs the Squadrismo to violence to hide the Chinese economic recovery

A recent article in Foreign Affairs was headlined Xi Jinping Is Not Stalin: How a Lazy Historical Analogy Derailed Washington’s China Strategy points out:

    Chinese citizens enjoy much greater autonomy over their own economic well-being than Soviet citizens did in the early days of the Cold War—a product of China’s more open, market-oriented, and globally integrated economy. On this dimension, the comparison is not even close.
    Look to foreign policy, and the analogy unravels further. Stalin openly proclaimed his desire for a global communist revolution, hoping to create a network of socialist states under Moscow’s rule—and it wasn’t just talk. In the early years of the Cold War, his Red Army soldiers, intelligence officers, and Communist Party agents aggressively imposed communism across Eastern Europe. He provided aid to Mao’s Chinese Communist Party and covert assistance to communists in Greece, encouraged proxy military forces in the Korean War, and supported coups around the world.
    Xi, by contrast, has not orchestrated the overthrow of a single regime. ...Xi has yet to instigate a coup, arm insurgents, or invade a democracy and install a communist regime. Little suggests that he seeks to subvert American democracy. (Russian President Vladimir Putin has been much bolder and more aggressive on that front.)
    The Trump administration undoubtedly would like a Stalinist leader to be in charge in Beijing, if only to better mobilize and unite Americans against him. But China “as it is” is not ruled by a new Stalin. Asserting otherwise doesn’t change that fact and gets in the way of developing a sophisticated, successful U.S. policy to contain, deter, and engage China over the long haul.

Hidden in most of the anti-communist political rhetoric of this Presidential Election is the evidence of a significant failure in the Trump Administration's China trade policy. One might even assume that a significant reason why so many Republicans oppose the Great Economic Lockdown of 2020 is the subject of the article headlined at the top of this post.

A summary of the dilemma for the Paleoconservative Republican Trump Administration can be found in the article:

    Robert Gwynne, a shoe manufacturing and exports specialist in Guangdong, said reviving competitiveness in the United States and elsewhere to compete with China would not be quick or easy.
    “To get it back,” he said, “you’re looking at 20 to 30 years, depending on what business you’re in.”

The Use of Violence and Fear to Distract Voters

A rapid restructuring of a complex economy sustained by free trade cannot be done in a country committed to the idea of democracy. Effectively, this is a curse for Paleoconservative republicans who advocate:
  • ultranationalism embracing in law the aspects that characterize and distinguish the United States as an autonomous political community including a common language and shared cultural traditions reinforced by restrictions on immigration,
  • regionalism based upon states' rights as expressed in the 10th Amendment including the decentralization of government social policy which with regional differences should favor paternalism and Christian traditionalism while limiting multicultural programs,
  • economic nationalism through federal policy and treaties limiting free trade, establishing tariffs, and implementing protectionism, while facilitating capitalism by assuring the unrestricted ease of interstate commerce and facilitating workers sharing generally in business profits through stock ownership,
  • noninterventionism in the conduct of American foreign policy, limiting the size of military commitments outside the United States,
  • cohesiveness among individuals and prioritization of the group over the self in order to defend and to sustain ultranationalism, economic nationalism, regionalism, and noninterventionism.
Whether he understands the implications, every indication is Donald Trump's ideological preference for government, our government, is that of a paleoconservative republican, otherwise known as fascist. As expressed by Trump in March 2019 such a system depends upon the threat of violence from the military to police, from biker groups to racist groups. He is doubling-down on that in the campaign at this time.

All of this leads to a review of history and the similarities with Italy after WWI. The lack of an adequate political history education has resulted in Americans confusing Mussolini's Italian nationalist economic agenda with Hitler's Nazi movement that came to power in Germany a decade later. That is a potentially dangerous view.

Whether You Call It Paleoconservative or Fascist, It's UnAmerican

We won't re-explore the commonality between the personality cults of Trump and Mussolini. For more on the subject read Yes, Barack...Donald Trump is a fascist but not a Fascist, a paleoconservative not a conservative or enter "Mussolini Trump" in a Google search.

While there are some commonalities in their personas and even appearance, it is important to note that Mussolini was operating within the communications constraints of 1920. Trump has instant electronic media at his disposal in 2020.

Their lives have nothing in common. Benito Mussolini's father, Alessandro Mussolini, was a blacksmith and a socialist, while his mother, Rosa (née Maltoni), was a devout Catholic schoolteacher. Mussolini thought of himself as an intellectual and was considered to be well-read.

In 1902, Mussolini emigrated to Switzerland, partly to avoid compulsory military service which might make one think he was like Trump. But that move was specifically focused on objections to policy. In 1915 he volunteered to serve in WWI and in February 1917 was wounded in action severely enough that he had to be evacuated from the front.

Between 1919 and 1920 an intense social conflict occurred in Italy, particularly between militant groups we would call the left (Socialists) or the right (Squadrismo  aka Blackshirts which became the inspiration for Adolf Hitler's S.A.). To make a long story short, a 39-year-old Benito Mussolini came to power in 1922 under a parliamentary coalition until the National Fascist Party seized control and ushered in a one-party dictatorship by early 1925.

Italy at the time of Mussolini's rise had a serious lack of strategic resources to sustain competition in a 20the Century industrial economy. So Fascist Italy began exchanging natural resources from Soviet Russia for technical assistance from Italy in the fields of aviation, automobile and naval technology.

Referring to the economics of John Maynard Keynes as "useful introduction to fascist economics", Mussolini initially spent Italy into a structural deficit that grew exponentially, but did expand the economy.

Trump, who substantially increased the U.S. structural deficit, has identified for his constituents a serious strategic lack in the American technology economy. As explained in The New York Times article, much of the production of consumer technology is not done by Americans. Simply we cannot sustain a technology economy on our own. Yes, jobs in other countries support that economy. Now the focus has turned on China which does, in fact, seem to be evolving innovative technology built on earlier, now out-of-date American-developed technology.

In Trump's Administration, the United States has aggressively attempted to restrain trade with China with a goal to have Americans rebuild their own technology and other consumer goods production.

Unfortunately for Trump's goal, Covid-19 appeared at a time when the U.S. government had naively chosen to believe that pandemics were not a threat and therefore was not prepared to take appropriate action. It has effectively prevented many companies from implementing plans to move production.

Making the situation more complicated, unlike the 39-year-old Benito Mussolini who served 21 years as Prime Minister, Donald Trump is 74. And unlike Mussolini, President Trump is limited to two four-year terms within a national government designed to be unwieldy in a country divided into 50 self-governing states.

(In fact, in the Constitution the Presidency was not given strong powers in domestic affairs. Unfortunately it was Democratic Presidents who assumed more power and Democratic-led Congresses that transferred Congressional powers to the President. It wasn't until the rise of Paleoconservative Republicans that the problem with Democratic thinking became obvious...to Democrats.)

Trump does appeal to many middle class voters because the American middle class lost out during the economic globalization of the last few decades when compared to the wealthiest class in the first world and to almost everybody in Asia. As explained in another Foreign Affairs article The World Is Becoming More Equal: Even as Globalization Hurts Middle-Class Westerners:

    The results highlighted two important cleavages: one between middle-class Asians and middle-class Westerners and one between middle-class Westerners and their richer compatriots. In both comparisons, the Western middle class was on the losing end. Middle-class Westerners saw less income growth than (comparatively poorer) Asians, providing further evidence of one of the defining dynamics of globalization: in the last 40 years, many jobs in Europe and North America were either outsourced to Asia or eliminated as a result of competition with Chinese industries. This was the first tension of globalization: Asian growth seems to take place on the backs of the Western middle class.
    These facts supported the notion that the rise of “populist” political parties and leaders in the West stemmed from middle-class disenchantment. Our graph became emblematic not only of the economic effects of globalization but also of its political consequences.
    The COVID-19 pandemic has so far not disrupted these trends and in fact might lead to their intensification. The remarkable deceleration of global growth resulting from the novel coronavirus will not be uniform. Chinese economic growth, while much lower now than in any year since the 1980s, will still outpace economic growth in the West. This will accelerate the closing of the income gap between Asia and the Western world. If China’s growth continues to exceed Western countries’ growth by two to three percentage points annually, within the next decade many middle-class Chinese will become wealthier than their middle-class counterparts in the West. For the first time in two centuries, Westerners with middling incomes within their own nations will no longer be part of the global elite—that is, in the top quintile (20 percent) of global incomes. This will be a truly remarkable development. From the 1820s onward—when national economic data of this kind were first collected—the West has consistently been wealthier than any other part of the world. By the middle of the nineteenth century, even members of the working class in the West were well-off in global terms. That period is now coming to an end.

Third Way Democrats in power, of course, effectively have been unaware of the implications of this. In the February 16, 2016, post writen well before the 2016 party conventions, Hillary Clinton's Dilemma: the Centrist Third Way Policies of Bill's Presidency vs. Young Women the following was offered:

    Trump is right. And while pundits dismiss this as pandering to voters' anger and frustration, both Trump and Sanders frame the problem as that of the political economy of intertwined economic and political systems. All working class voters, not just the younger ones, know that there is something like this wrong in our country and believe correctly that this does them harm. The informed young Democrat realizes that the path to their stress was paved by Bill Clinton.
    Unfortunately, Bill Clinton embraced the centrist Third Way philosophy of governance. It is a hopeful philosophical construct that seeks the pursuit of greater egalitarianism in society through action to increase the distribution of skills, capacities, and productive endowments, while rejecting income redistribution as the means to achieve this. In doing this, it pretends to be a kind of change on democratic socialism that Bill Clinton embraced. To quote one Republican we all know: "I gotta ask the supporters of all that, 'How's that hopey, changey stuff working out?'"
    The problem is the centrist Third Way is not a variant on democratic socialism or even the philosopihical traditions of the New Deal and Great Society. It is a deviant. And every well-informed young black lesbian who grew up in a single-parent household knows this.
    I would prefer that the Hillary Clinton campaign, which has already moved slightly away from the centrist Third Way, move much further toward the political philosophy represented by the economic policies of Presidents Franklin Roosevelt and Lyndon Johnson. That would be better for America and for those critical Millennial Democratic women and for a very large number of unemployed young men.

We are now at a point that for 29 million people their source of income is unemployment insurance. Yes, the immediate cause is the pandemic. But the truth is most of those 29 million were struggling before Covid-19. They never experienced the union-built labor economy of the period between 1950-1970 that allowed expansion of a prosperous middle class. Other Americans did gain from that which makes it easy to identify one problem in the Democratic Party that must be corrected:

While two men in their 70's are running for President, those 29 million workers are facing a time when Americans who identify as white workers "with middling incomes...will no longer be part of the global elite—that is, in the top quintile (20 percent) of global incomes." It appears the pandemic will accelerate the timeline of that decline.

The are two ways to address this. The most pernicious would be to sacrifice real income improvements to freeze the existing hierarchical system of the global income distribution. That would also require slowing any gain in equity by minorities in the United States.

Any other option will require ingenious innovative thinking that must come from the Millennials. It's hard for someone as old as this writer to imagine success within the confines of the 18th Century governmental structure of the United States. It's easy for someone as old as this writer to imagine Paleoconservative thinking within the confines of the 18th Century governmental structure of the United States.

Having so many people in government being as old as this writer is a problem. But some of us know this about any battle between socialism and fascism over economics, beyond the fact that both are unAmerican. State socialism is a political and economic philosophy encompassing an economic and social system characterized by state ownership of the means of production. State fascism as practiced in Italy involved a controlling private sector economic policy that included:
  • the opposition to class struggle to create more productive society through the economic collaboration of the classes (fascist syndicalism);
  • the critical importance of economic productivity as a revolutionary force, ss productivists, rather than distributionists;
  • the elimination of free trade and initiation of protectionism;
  • the recognition and support of various cartels (consorzi) that had been created by Italian business leaders since Mussolini took office;
  • the nationalization of holdings by large banks which had accrued significant industrial securities;
  • the sale of most state-owned telephone networks and services;
  • the elimination of thestate monopoly on life insurance;
  • the return to private ownership of a metal machinery firm;
  • the awarding of concessions to private firms to set up tolls on motorways;
  • and more.
Some of this is more 1920's than 2020's. But take hard look at the Trump Administration's actions over the past three years and you'll find more than a slight resemblance. And in 2020 the gradual opening of federal lands to development in the face of Climate Change really stands out.

Ironically the Chinese single party government has mixed the use of state socialism and state fascism in an effort to become the significant economic world power. How we counter that without a one-party dictatorship should be the only concern of the two parties. It does not appear that the paleoconservatives in the current Administration see that as a concern.

Tuesday, September 1, 2020

A trade war, gig economy, and lack of immigrant workers will be the key factors in prolonging the post-pandemic Extended Economic Distortion

Because the differences between the 20th Century and 21st Century economies are significant, though not commonly identified, they will become significant elements in the post-pandemic Extended Economic Distortion.

Like most centuries, what is significantly different from the last century is confusing because the source of changes seem to escape clarity. For instance, as late as April 2009 international finance guru Randy Charles Epping's book The 21st Century Economy--A Beginner's Guide was released to acclaim and was regarded Bookauthority.or as among the "40 Best New Economy Books".

In that book according to one description: "Epping defines key ideas and commonly used words and phrases like carbon footprint, WTO, economy of scale, NAFTA, and outsourcing [and] illustrates how central banks help navigate global crises and drive the global economy, discusses the benefits of Green Economics, shows how trade wars can be avoided...."

Uh, shows how trade wars can be avoided?

One thing 2016 and 1916 have in common is that the economics of the previous century was about to come to an end. In 1916 we had WWI followed by The Great Depression and WWII.  In 2016 when Donald Trump took control of the Republican Party and won the U.S. Presidency, he began a nationalist trade war with the rest of the world completely disrupting the norms of the global economy, a trade war that appears to be expanding into hostilities when it comes to China.

Then came 2020's pandemic shutting down travel and commerce for many months - we don't know how many, because it's still going on and does not appear to be on a course towards full recovery. Except for China which, as explained in The New York Times:

    This was supposed to be the year that China’s export machine began to stall. President Trump had imposed broad tariffs on Chinese goods. Countries like Japan and France pushed companies to shift production from China. The pandemic had crippled China’s factories by the end of January.
    Instead, China Inc. has come roaring back.
    After reopening in late February and early March, China’s factories began an export blitz that is still gaining steam. Exports soared in July to their second-highest level ever, nearly matching the record-setting Christmas rush last December. The country has grabbed a much larger share of global markets this summer from other manufacturing nations, entrenching a dominance in trade that could last long after the world begins to recover from the pandemic.
    China is showing its export machine cannot be stopped — not by the coronavirus and not by the Trump administration. Its resilience lies not only in the country’s low-cost, skilled labor and efficient infrastructure but also in a state-controlled banking system that has been offering small and large businesses extra loans to cope with the pandemic.
    The pandemic has also found China better placed than other exporting nations. It is making what the world’s hospitals and housebound families need right now: personal protection gear, home improvement products and lots of consumer electronics.

The irony of this is important to California. As explained here in the lengthy November 24, 2016 post #Calexit. Perhaps 170 years of invidious doubtful scorn is enough California's early European influence was Spanish trade with Asia:

    Effectively the Pacific Coast (and more) of the Americas was left to the Spaniards, good Roman Catholics all, to colonize and they did so from Northern California to Cape Horn.
    The first European contact in California was a Spanish sailing expedition, led by Portuguese (?) captain Juan Rodríguez Cabrillo, in 1542, which traveled up the Pacific Coast as far north as the Russian River. Subsequent Spanish expeditions, followed....
    In 1565 the Spanish developed a trading route where they took gold and silver from the Americas and traded it for goods and spices from China and other Asian areas. The Spanish set up their main base in the Philippines. The trade with Mexico involved using an annual passage of Manila galleons, which would traverse somewhere near Cape Mendocino, then could turn south down the California coast towards their home port in Mexico.
    When the value of California for trade routes became obvious to several other European interests, particularly the Russians whose fur traders were traveling from Alaska down the coast, the Spanish sent the Portola Expedition both over land and sailing up the coast in 1769.
    The Portola Expedition's original assignment was to travel to the "port of Monterey" described by the Vizcaino expedition and establish a settlement there. After that, the explorers were to continue north to locate Cermeño's "Bay of San Francisco" (the northern end of which is now called Drake's Bay), chase away any Russians encountered, plant the Spanish flag and determine whether the bay would make a good port.
    After the Portolà expedition of 1769-70, Spanish Catholic missionaries began setting up 21 California Missions on or near the coast of Alta (Upper) California, beginning in San Diego. During the same period, Spanish military forces built several forts (presidios) and three small towns (pueblos). Two of the pueblos grew into the cities of Los Angeles and San Jose. And so California became a part of Viceroyalty of New Spain.

Except in the midst of WWII, trade with Asia has been critical for California's economy since the 17th Century. In the past four decades, trade with Asia has been integral to the U.S. economy as a whole. In 2018 Asian trade for the U.S. totaled $1.6+ trillion. In the first six months of 2020 it was $115 billion less.

A new 21st Century economy integral element is the so-called "Gig Economy." For many it is hard to understand the significance of the Gig Economy. Apparently the federal government has no lack of understanding.

There was no hesitation on the part of the federal government as reflected in the red in the chart to the right. Those red bars are the people on Unemployment Insurance (UI) under federal programs established by the CARES Act and some other programs

Under the CARES Act states are permitted to provide Pandemic Unemployment Assistance (PUA) to individuals who are self-employed, seeking part-time employment, or who otherwise would not qualify for regular unemployment compensation.

The important thing to recognize is that news stories such as in today's New York Times begin with "just over one million Americans filed new claims for state jobless benefits last week" before noting further down on the page "another 608,000 people filed for benefits under the federal Pandemic Unemployment Assistance program."

The truth is last week 1.43 million new unemployment claims were filed, and 42.5% were under the PUA many of whom, if not most, fall under the vague definition of gig workers who were working in the Gig Economy. And it is this subject that also relates to California's history.

If you know about the film industry you know that today actors, writers, and almost all other production folks are effectively gig workers, meaning they don't have jobs until they are hired for specific productions then laid off. Many work enough to get UI for a period, but then must do jobs like wait tables. It wasn't always this way as a 1984 New York Times article noted:

    In 1938, Metro-Goldwyn-Mayer had 120 actors and actresses under contract, including Clark Gable, Greta Garbo, Robert Benchley, Dame May Whitty, Judy Garland, and Freddie Bartholomew. Nearly a hundred writers and directors were under contract to M-G-M that year, too. And 1938 was hardly a peak year during the golden era of the Hollywood studio system.
    Although the movie industry has often yearned publicly for the old days - Francis Coppola, for example, bought a nine-acre studio in the heart of Hollywood a few years ago in order to re-create the old system, and every decade Universal has announced a ''new talent'' contract program - the studio system, with its old authoritarianism, has stubbornly remained as dead as the dodo bird and passenger pigeon that it followed into oblivion. Mr. Coppola's Zoetrope, which put four promising actors under long-term contract, is bankrupt; and somehow the new talent programs, which tried to do the same thing with beginning actors, never worked.

In the film industry there is some evolved benefits programs through unions for some of the quarter of a million California film industry UI applicants. But that isn't true for the bulk of the Gig Economy that began in the past two decades. Investopedia lays the subject out straightforwardly:

    In a gig economy, temporary, flexible jobs are commonplace and companies tend toward hiring independent contractors and freelancers instead of full-time employees. A gig economy undermines the traditional economy of full-time workers who rarely change positions and instead focus on a lifetime career.

Wikipedia offers considerably more discussion but gives this piece of critical information:

    In the 2000s, the digitalization of the economy and industry was carried out rapidly due to the development of information and communication technologies such as the Internet and the popularization of smartphones. As a result, on-demand platform based on digital technology has created jobs and employment forms that are differentiated from existing offline transactions based on accessibility, convenience and price competitiveness, the so-called Gig economy has become a focus.

Within the overall economy, the Gig Economy has complicated things because as noted in Wikipedia "36% of U.S. workers join in the gig economy through either their primary or secondary jobs." And they are likely the bulk of the 42.5% of new filings for unemployment.

Complicating the matter further, California is in the middle of a policy battle over whether gig workers are should be employees, not independent contractors. It's complicated and the outcome could impact the future of the national economy.

Foreign trade and the Gig Economy are two integral elements of the 21st Century American economy facing significant change. A third is the role of immigrant workers.

We are generally familiar with the nearly-century-old policy debate - perhaps battle - over immigrants, both legal and illegal, who work in agriculture. The Trump Administration has instituted policies that reduce the number of available workers, implying that the goal is zero. That would have a significant impact on the cost of food.

Then there is the complicated issue of the H-1B visa, on which U.S. technology companies have become dependent for workers. The issue is complicated because some companies use those visas to tie workers to a job and pay less than the market wage. But the United States and China are in a growing competition for technological leadership in areas such as artificial intelligence, biotechnology, quantum computing, and other sectors vital to future economic and military prowess. The Trump Administration's has acted to restrict both student and H-1B visas.

In the pandemic with its travel restrictions many actual and potential technology workers have gone home and others have not been able to come to the United States. In effect the pandemic has implemented Trump policies. This is going to disrupt American technology leadership already being effectively challenged by China. It is not clear that this will change in the next few years.

The post-pandemic Extended Economic Distortion is going to result from, among other factors, reduced world trade, reevaluation and potential reorganization of the Gig Economy, and a loss of immigrant worker efficiency and expertise.

A reason for the surprising ease that the early $500 billion in direct intervention for American families passed both houses of Congress. Without it, 17 million people would have dropped below the poverty line. That's why Trump bypassed a stalled Congress with the $300 per week second round add-on to UI.

Getting restaurant and personal care workers back to work is a goal to avoid some potential deep poverty. But post-pandemic economic issues go well beyond the service industry and well beyond the time when a vaccine will push Covid-19 onto the same shelf in people's minds as "the flu."

No historical period exists that is identical to this time. But the sharp deflationary recession across Europe and in the United States known as the Depression of 1920–1921 was stimulated by the return to the civilian economy of troops after the end of World War I.

But it created an economic distortion further twisted by the Spanish Flu and the rise of labor unions. Each country responded differently. Italy's response to the social unrest offers a cautionary lesson for dealing with an Extended Economic Distortion in 2020. We will explore the Mussolini-effect here in the future.