Economy

Last summer, Covid claimed yet another casualty. The Post Pub, tucked away under a low ceiling on L Street in Washington, was a throwback to a different age, one of noontime highballs and midnight shots on the house. Yet while the past had been swinging, the future for the little downtown watering hole was bleak, and so it announced that it would have to close. For me, the loss was personal. The Post was where I had deepened countless friendships over glasses filled and then unfilled with foamy brown. It was where, in 2018, I looked up at the TV above the bar, saw the words “fire and fury” on the same chyron as “North Korea,” and wondered for a fleeting second whether that was where I might die (it wouldn’t have been a bad end, all things considered).

Gawker returned in 2021 with the air of a drunk stumbling back into a party he had never been invited to. Leah Finnegan, the new editor, admitted that the brand was “toxic” but appealed to the reader to keep “an open mind and an open heart.” (What is this? Gawker or an e-celeb issuing an apology video over a sexual harassment scandal?) Me, I was biased. I hated Gawker. The original site was a hive of mean-spirited moralists. The average Gawker employee was the sort of person who would post revenge porn while lambasting people who mildly transgressed against speech codes. Their writing pioneered the sort of effortful indifference that still leads Brooklynites to claim that people are “having a normal one” and things are “like, er, yikes”.

My father was born in 1948. He’s the same age as Jackson Browne: ’65 I was 17, ’69 I was 21. His plan was to graduate from his Western Pennsylvania public high school and join the Marine Corps. The local draft board came damn close to saving him the trouble of enlisting. But near the end of his high school career, it was discovered that his girlfriend was “in a family way.” His parents briefly floated the idea of obtaining an illegal abortion. Fortunately, my 17-year-old father, his soon-to-be in-laws, and his Episcopal priest (in those days such men could be depended upon) stood firm. He and his girlfriend were married. Soon after, my half-brother was born and my father enrolled in an apprenticeship program with the International Brotherhood of Electrical Workers.

No issue has been more politicized over the last six months than the sudden reemergence of inflation. For those keeping score at home — and many of us are whenever we buy our groceries — the latest report puts the current inflation rate at 6.8 percent, the highest since 1982. How one perceives the inflation threat depends as much on one’s political beliefs as it does on economics. Many conservatives are inclined to see this inflation as a more permanent fixture of the economy, believing it to be a consequence of the ongoing profligacy of the Biden administration. Democrats, in contrast, have tended to characterize the phenomenon as largely transitory and more a result of ongoing supply issues related to the pandemic.

No one forced mainstream media outlets and cable news channels to go all in on Jussie Smollett’s fantastical tale of being mugged in subzero temperatures at two o’clock in the morning by two mysterious MAGA-hat-wearing perpetrators in January 2019. “The Racist, Homophobic Attack on Jussie Smollett Is America's Endgame” cried GQ in one of several instances of the mainstream press abandoning all journalistic ethics (again) or skepticism in favor of political confirmation bias. Once again they handed a giant bat to Donald Trump and others on the right who were accused of being second-hand enablers of the Smollett attack — and now, rightly, they’re being smashed for it.

Cockburn is finally allowed to travel internationally again and he is quite chapped that his airport bar bourbons will no longer be paired with a side of CNN. It was, in fact, the only time he would indulge in the network’s antics. But based on the recent headlines about the poorly rated cable news channel, the loss of its airport network should be the least of CNN’s worries. Primetime anchor Chris Cuomo, who was ousted from his show last week over revelations that he was deeply involved in his brother’s public response to sexual harassment allegations, is reportedly planning to sue the network for the rest of the money from his contract. This is bad news for CNN, which is now quietly investigating a sexual misconduct accusation against Chris.

This weekend, Donald Trump announced that his nascent digital-media company, Trump Media & Technology Group, had secured $1 billion in investment from various unnamed sources, as part of an effort to become publicly traded. Shortly after, it was revealed that Representative Devin Nunes was set to leave Congress to become the firm’s CEO. The announcement comes three months after the special-purpose acquisition company called Digital World Acquisition Corporation listed publicly to little fanfare. The SPAC, sponsored by Miami-based financier Patrick Orlando, joined more than 400 other “blank-check” companies that raised money in the first three quarters of 2021.

President Joe Biden’s re-nomination of Jerome Powell as Federal Reserve chairman came as no surprise to financial analysts. Powell remained the most likely candidate given his ability to schmooze and glad-hand with politicians within and outside the administration. He earned the title of “best bureaucrat in Washington, DC” by receiving endorsements from both National Review and the American Prospect despite their divergent policy views. A corresponding vote in the Senate seems preordained, unless Massachusetts Senator Elizabeth Warren gets her way and forces a new pick. “Reappointing Powell is the safest route here,” the Cato Institute’s Norbert Michel told me in an email after Powell’s nomination on Monday.

Scientifically, the jury is still out on whether women are better multitaskers than men. A 2013 study suggested that women do, in fact, outperform men, while a 2019 German study found no demonstrable differences between the sexes. In my entirely unscientific opinion, I think the stereotype is real. Women are engaged in all kinds of things at the same time. At any given moment, I’m engrossed in my work while also contemplating the contents of my freezer, making a mental note to order more diapers, and simultaneously clipping my daughter’s toenails. A New York Times piece on why women do the household worrying described a woman’s mental load as a “combination of anxiety and planning that is part of parenting.

Joe Biden cheerfully told Americans that most of them are too thick to understand what a “supply chain” is. Naturally, he understands it thoroughly. You can see with your very own eyes how well he has handled it. Since, as Joe said, you must be wondering why so many shelves are empty, I’m here to explain. Following the president’s wise advice, I will use small words and a simple story. Let’s begin in the good ol’ days, not too long ago, when the shelves were magically full. The story begins in a land ever so far away, where happy people worked and worked to make Christmas toys for children in Kansas. When they finished making the toys, they placed each one in a little box and then placed lots of them in a great big box.

No one knows what will come out of the sausage making now going on up on Capitol Hill, but let’s take a look at one proposal to raise money to pay for some of the cost of the reconciliation bill. At the moment, capital gains are taxed only when the asset is sold or the owner dies. (The estate tax is just a tax on capital that is triggered by death rather than by sale.) Oregon senator Ron Wyden proposes that they be taxed every year whether sold or not. Unrealized capital gains are certainly a tempting target. After all, for people like Bill Gates and Jeff Bezos, practically their whole, vast fortunes are capital gains, the cost basis of their stock in Microsoft and Amazon is, at most, a few cents a share.

Who knew our relationship with China would be responsible for ruining not one but two Christmases? At least this year we had a bit of warning. Our own vice president told us of the current supply chain issues back in August. While most Americans were worried about President Biden’s botched withdrawal from Afghanistan, Vice President Kamala Harris was in Singapore discussing a different topic altogether. “The stories that we are now hearing about the caution that if you want to have Christmas toys for your children it might be the time to start buying them because the delay may be many, many months.” For once, Kamala was correct. Last year, in the middle of the pandemic, Americans had very different concerns.

Tucked away in the reconciliation bill now bogged down in Congress is a requirement that banks report the annual deposits and withdrawals from every bank account that has activity of more than $600 a year. It would not list individual transactions, just the total money flow in and out. Ostensibly, this is to catch rich people who have been under reporting income. Secretary of the Treasury Janet Yellen gave as an example: “High-income individuals with opaque sources of income that are not reported to the IRS, there's a lot of tax fraud and cheating that's going on.” Wages, salaries and fees are already reported to the IRS through W-2 forms. So is investment income. That sort of income is what a large majority of American families depend on.

The most important macroeconomic development of the last three decades has been the extraordinary growth of the Chinese economy. In 1990, it was largely a subsistence peasant economy with a negligible footprint in world trade. China now provides the largest share of world exports, and by some standards has already become the world’s largest economy. In 1990, the wage of an average Chinese worker was perhaps 1/40th of that of an American worker. By 2020, it was just about a quarter: a tenfold gain in just 30 years. Before the 18th century, all societies were basically subsistence peasant agricultural societies with a small upper layer of landowning nobles and clerics. Then the Industrial Revolution began.

Many are familiar with the old aphorism that in real estate the three most important determinants of value are location, location, location. Things are a bit different in making economic forecasts and predictions, where two variables matter most: accuracy, of course, but also timing. Regarding accuracy: a lengthy list of economists — some quite eminent — have ended up with egg on their faces because of inaccurate predictions and forecasts. In this regard, there’s the observation by the distinguished economist Irving Fisher, 92 years ago today on October 16, 1929, that stock prices had reached 'what looks like a permanently high plateau’. Since the Great Crash occurred two weeks later, Fisher’s timing wasn’t so great either.

Deep down, everyone has always known that the wealthy and powerful hide away vast quantities of often ill-gained money in far-flung tax havens. In recent years though, with the Panama and Paradise Papers, the public has had chances to see how the clandestine industry that helps the elites do so operates. Another such opportunity has come knocking with what is being called the biggest leak of offshore data in history. The Pandora Papers consist of almost 12 million files that lay out the secret financial affairs of almost three dozen world leaders and hundreds of high-level public officials from more than 90 countries. The details make for sensational headlines: the king of Jordan has a hidden $100 million real estate empire (including a seven-bedroom mansion in Malibu!