American Exceptionalism – The Wrongologist

Cartoons Of The Week

Welcome to a week that included TikTok, March Madness and St. Patrick’s Day!

The House overwhelmingly passed legislation to ban TikTok:

But will it ever become law?

Trump said the quiet part out loud:

Insulin remains under threat:

Yes, Big pharma is suing the Biden administration for making insulin affordable. They say his actions are “unconstitutional“. It’s important to remember that they didn’t invent insulin and it is cheap to make.

The GOP’s double standard on documents:

The mystery surrounding Princess Kate isn’t going away:

Boeing is so badly broken it’s hard to see how it recovers:

March madness has many meanings:

Wrongo’s favorite St. Paddie’s Day cartoon:

Florida Lets Measles Run Free

The Daily Escape:

Highland Lighthouse, North Truro, Cape Cod, MA – February 2024 photo by Barbra A. Bentley

Let’s take a break this Saturday from a) Russia’s infiltration of the Republican Party and b) the growing realization that unless House Speaker Mike Johnson Johnsonless whips his members into shape before March 1^st, we’ll have a government shutdown. Instead let’s focus today on Measles.

You are a witness the continued collapse in US public health standards since Florida’s Surgeon General has said its ok for unvaccinated kids to attend public school even though there are measles outbreaks. From KFF News:

“With a brief memo, Florida Surgeon General Joseph Ladapo has subverted a public health standard that’s long kept measles outbreaks under control. On Feb. 20, as measles spread through Manatee Bay Elementary in South Florida, Ladapo sent parents a letter granting them permission to send unvaccinated children to school amid the outbreak.”

“The Department of Health ‘is deferring to parents or guardians to make decisions about school attendance,’ wrote Ladapo, who was appointed to head the agency by Florida Gov. Ron DeSantis, whose name is listed above Ladapo’s in the letterhead.”

With his brief memo, Ladapo has subverted a public health standard that’s long kept measles outbreaks under control. This is where you wind up after decades of indoctrination of libertarianism and neoliberalism, where “freedom” becomes anarchy, a rejection of the ability of the state to impose restrictions, even in the name of public safety.

Everyone in America knows that measles is highly contagious, that it kills, and can do lasting damage. More from KFF:

“Most people who aren’t protected by a vaccine will get measles if they’re exposed to the virus. This vulnerable group includes children whose parents don’t get them vaccinated, infants too young for the vaccine, those who can’t be vaccinated for medical reasons…”

The CDC advises that unvaccinated students stay home from school for three weeks after exposure. About 1 in 5 people with measles end up hospitalized, 1 in 10 develop ear infections that can lead to permanent hearing loss, and about 1 in 1,000 die from respiratory and neurological complications. They reported that in 2023, childhood immunization rates had hit a 10-year low.

Worse, only about a quarter of Florida’s counties had reached the 95% threshold at which communities are considered protected against measles outbreaks, according to data posted by the Florida Department of Health in 2022.

Rebekah Jones, a data scientist who was removed from her post at Florida’s health department in 2020, over a rift regarding Coronavirus data, said:

“I think this is the predictable outcome of turning fringe, anti-vaccine rhetoric into a defining trait of the Florida government,”

A strategy of letting measles spread (which can wipe out your body’s immunity memory) while Covid is still pin-balling its way around the country? Sounds legit.

The way that things are going with public health in the US, it’s only a matter of time until the health departments of other western countries start issuing travel health notices for their citizens wanting to visit the US, advising them of the diseases that are being left to run free, particularly in Florida.

From The Nation:

“In 2022, Georgetown University political scientist Donald Moynihan wrote a piece on how to undermine the administrative state….No country becomes a world power without a capable public service.”

Perhaps the corollary, as stated by The Nation’s Gregg Gonsalves is this:

“No country becomes healthy without a capable public health system.”

That describes America today. More from The Nation:

“We did terribly on Covid…part of the reason was that our fundamentals were weak, but our politics are also set up to undermine public health….This has implications well beyond…the pandemic. It’s about how we expect to survive and thrive in America….This is a disaster in slow motion, and we’re watching it unfold as bystanders.”

There you have it: another thing to lose sleep over, and the election is still 7+ months away. Will there be enough infant deaths to generate sufficient outrage to roll this decision back?

Highly doubtful.

Wrongo is leaving you with that thought and is segueing into our Saturday Soother, where we take a break from doom scrolling and spend a few stolen moments alone with our thoughts. Here on the Fields of Wrong, there is still snow on the ground. So while we hope that spring is just around the corner, there’s little evidence to support it.

To help you relax, grab a seat by a south-facing window and watch and listen to Samuel Barber’s “Adagio for Strings”, played here by the Vienna Philharmonic, and conducted by Gustavo Dudamel. Dudamel is scheduled to become music director of the New York Philharmonic in 2026. This performance was a part of the annual free Vienna Summer Night Concert in 2019.

This is the fourth time Wrongo has featured this composition, although you are seeing this particular version for the first time.

Barber finished the Adagio in 1936. In January 1938, Barber sent an orchestrated version of the Adagio for Strings to Arturo Toscanini. The conductor returned the score without comment, which annoyed Barber. Toscanini later sent word that he was planning to perform the piece and had returned it simply because he had already memorized it!

It was performed for the first time by Toscanini in November, 1938. Here, it is conducted by Gustavo Dudamel in 2019, like Toscanini did, without a score:

The Number Of Guns Seized in US Schools Is Soaring.

The Daily Escape:

Geminids Meteor shower, Grand Tetons, WY – December 2023 timed exposure photo by Jeff Bernhard

We’ve just passed the 11^th Anniversary of the school massacre in Newtown, CT. Wrongo and Ms. Right live about 20 minutes from the scene. While that grisly event is never too far from our consciousness when December rolls around, we never thought there would come a time when America would have an easier time banning books than guns. From the WaPo:

“Last school year, news reports identified more than 1,150 guns brought to K-12 campuses but seized before anyone fired them, according to an investigation by The Washington Post. That’s more than six guns each day, on average. Nationwide…1.1 million students…attended a school where at least one gun was found and reported on by the media in the 2022-2023 school year.”

It’s hard to imagine that while some children are trying to learn, others are packing.

Even that exhaustive review of local news sources doesn’t account for guns that are carried into schools undetected. In addition, many gun seizures are never disclosed by districts. Some guns are found on campuses located in communities that are underserved by news organizations.

The Post asked the country’s 100 largest school districts to share data on guns seized over the last five school years. Many said they do not track that data. But disclosures from 51 of them illuminated the gap between what’s reported in the news and what happens in schools.

In those districts, representing 6.3 million students, 515 guns were found during the 2022-2023 school year. That means 58% of seizures in those districts last academic year were never publicly reported by news organizations. The Post’s survey recorded guns recovered at schools in rural, suburban and urban areas, in all 50 states and Washington, DC. Here’s a chart from the WaPo survey:

Note the sharp increase after the Covid shutdown. A giant problem is that the true number of guns on school campuses is almost certainly far higher.

The Post found that the number of campus gun seizures spiked significantly between the 2018-2019 school year and the 2022-2023 school year — a five-year period that, following the pandemic shutdowns, has also seen significantly more behavioral problems in school. The 47 districts for which The Post was able to obtain five full school years of data saw a 79% increase in guns found on campuses over that time frame. In many communities, the number of guns found has more than doubled, a trend that mirrors a precipitous rise in school shootings.

A huge question is what’s causing so many more kids to bring loaded guns to school? The WaPo quotes Megan Ranny a leading firearm-injury researcher and dean of the Yale School of Public Health:

“Kids are more likely to carry firearms, and even to bring firearms into school, if they have been victims of violence themselves, if they aren’t connected to a community, if they have post-traumatic stress….We’ve got a lot of kids who are scared…maybe have lost parents from Covid, maybe have lost community connections because of shutdowns of community groups during Covid. And then add on to it increased access to firearms. A lot of guns bought over the last couple of years. It becomes a perfect storm.”

Such frightening thoughts. One of the positive outcomes from Sandy Hook is that Sandy Hook Promise, a nonprofit launched after the 2012 killings, debuted the “Say Something Anonymous Reporting System” that allows users to anonymously alert school officials of safety concerns at any time of day, online or by phone. More from WaPo:

“More than 5,000 schools use the program….The system is free to schools….In the districts they’ve trained, about 3% of students and staff, on average…submit tips…although some school systems see higher participation rates, up to 5%. Most tips concern suicidal behavior and drug use. But the system has averted at least 143 acts of violence with a weapon, including at least 15 planned school shootings, since 2018…”

And what about parents? What’s their responsibility for one of their kids bringing a gun to school? Parents have largely skated on accountability for the misdeeds of their children, except in Virginia, where last week, CNN reports that:

“The mother of the Virginia 6-year-old who shot his first grade teacher in January was sentenced Friday to two years in prison, according to the court in Newport News.”

What happens to her son (she’s a single parent) will be collateral damage in this story. Parents need to be held accountable for these acts, particularly when the kid took the parent’s gun to school.

When we talk about what‘s wrong today, we have to admit that there’s nothing more important in America than the supremacy of the Second Amendment. Your life, the lives of your spouse and children, or your friends are worth nothing compared to that “right” to own guns.

Time to wake up America! The nation is sinking under this sick and warped interpretation of the Amendment. To help you wake up, It’s the perfect time for Tchaikovshy’s 1892 “Waltz of the Flowers” from his ballet “The Nutcracker”. Here it is performed by the Concertgebow in the Netherlands, conducted by Semyon Bychkov.

The waltz is the last number in the Nutcracker Suite, which is set on Christmas Eve at the foot of a Christmas tree in a child’s imagination:

Kissinger Has (Finally) Left The Building

The Daily Escape:

Camden, ME – November 2023 photo by Daniel F. Dishner. Note the star: It’s on top of nearby Mt.Battie.

Kissinger may have changed the world, but that isn’t always a good thing. The media are calling his legacy “complicated”. For Wrongo, it isn’t complicated. He may have gotten Nixon to China and negotiated (?) the end of the war in Vietnam, but his time on our foreign policy stage is strewn with death and destruction. Think about the carpet bombing of Cambodia that led to the demonstrations against the war in May 1970 and to the murders at Kent State and Jackson State University. Think about the coup in Chile that overthrew Salvador Allende.

Now, Nixon’s entire Cabinet is dead.

Kissinger’s philosophy was to look at “the big picture”. He was gladdened by how his China diplomacy rattled the Soviets. Most of Wrongo’s current thinking about Kissinger comes from reading Christopher Hitchens’ 2001 book, “The Trial of Henry Kissinger”. Hitchens talks about Kissinger’s role in the destruction of Chilean democracy in favor of the Pinochet dictatorship. And when Pinochet ordered the assassination of dissenter and former U.S. ambassador Orlando Letelier on US soil by blowing up his car in Washington, Kissinger was fine with that.

He was responsible for the prolongation of the Vietnam War through the sabotage of Lyndon Johnson’s 1968 Vietnam peace talks along with the civilian deaths from the US’ bombing in Laos and Cambodia, helping to usher in the Khmer Rouge, while also not doing anything positive to win the Vietnam war. Kissinger then became supportive of the Khmer Rouge. He saw its leader, Pol Pot as a counterweight against North Vietnam. He asked Thailand’s foreign minister to tell the Khmer Rouge: “We will be friends with them. They are murderous thugs, but we won’t let that stand in our way. We are prepared to improve relations with them.”

That was Kissinger’s moral philosophy.

Kissinger was behind the Greek military junta’s invasion of Cyprus in 1974, and the Pakistani army’s crimes against humanity in East Pakistan (now Bangladesh). And we shouldn’t forget the Indonesian invasion and subsequent destruction of East Timor.

Quite the record for a Nobel Peace Prize Laureate.

Late in life. Kissinger continued supporting authoritarians including Putin. Kissinger intervened in Putin’s imperialist war in Ukraine in 2022 to support the idea that the West should bully Zelensky into giving up territory to the Russians. He was also on the board of Theranos helping to facilitate the fraud while lining his pockets.

Wrongo wrote earlier this year about how he started out as a Kissinger fanboy, having read his 1957 book “Nuclear Weapons and Foreign Policy” while in high school. It criticized the Eisenhower Administration’s “massive retaliation” nuclear doctrine. It proposed the use of tactical nuclear weapons on a regular basis to help win wars. By the time that Wrongo was running a tactical nuclear missile base in the mid-1960s, he was no longer a fan. From Wrongo:

“Wrongo met Kissinger in the mid-1980s at an event hosted by David Rockefeller at his Pocantico Hills estate. HK was walking his dog, a particularly obstreperous Golden Retriever. Wrongo asked “What’s the dog’s name?” Kissinger replied: “Madman”. Could there be a more perfect name for a Kissinger family pet?”

Here are a few headlines announcing Kissinger’s death:

You’ve gotta love the Rolling Stone headline.

Kissinger’s legacy is defined by his role in the US’s resumption of ties with China. He did the groundwork for Nixon’s 1972 visit to China and made more than 100 trips to the country over the years. The WaPo noted that the China state broadcaster labeled Kissinger an “old friend of the Chinese people.”

Let’s close with another possibly apocryphal story about Kissinger by Corey Robin:

Let’s hope that Henry the K is having a really hot time in his new condo.

Proportionality In Gaza

The Daily Escape:

Fall colors, Ophir, CO – October 2023 photo by Chirag A. Patel

Welcome to our Saturday Soother. The problem is that getting soothed today may prove difficult. Israel’s military said Friday night (local time) that its “ground forces are expanding” their operations in Gaza. The decision to expand ground operations was made by the Israeli War Cabinet after talks on a possible hostage release reached a stalemate.

Biden’s Plan To Cut Drug Prices

The Daily Escape:

Mars on left, Earth on right – image by alofeed

The Biden administration released its list of 10 prescription medicines that will be subject to the first-ever price negotiations by Medicare. This is a big deal because Medicare covers 66 million older Americans, people who routinely take very expensive drugs.

Until recently it was illegal for Medicare to negotiate prices with drug companies. But the Inflation Reduction Act (IRA), passed last August, gives Medicare that power. It also forces companies to pay a rebate to Medicare if their drug prices rise faster than inflation. The Congressional Budget Office estimates that price-capping measures will reduce Medicare expenses (and the federal deficit) by $96 billion by 2031.

The list includes drugs for diabetes, arthritis, and Crohn’s disease, and could sharply lower medical costs for patients. Reuters says that the US Centers for Medicare & Medicaid Services (CMS) spent $50.5 billion between June 1, 2022 and May 31, 2023 on these 10 drugs. That was about 20% of the total cost of drugs in the Medicare prescription drug program known as Part D.

The WaPo had an opinion piece by David Goldhill, CEO of SesameCare.com, a digital marketplace for discounted health services: (brackets and emphasis by Wrongo)

“The pharmaceutical industry earns almost 50% of its worldwide revenue here [the US], as do medical information-technology firms. [Medical] Device makers earn 40% of their money in the US. And this understates things, because US revenue is generated from higher prices, so margins are greater. If the US accounts for half of a company’s revenue, it probably contributes at least 75% of its profits.”

This has always been the business plan for Big Pharma: Make your money in the US and take whatever scraps of profit you can get in other markets.

That market subsidy is paid by American taxpayers generally (through the funding of Medicare) and by US pill-takers specifically when they pay higher co-pay prices for the drugs that help with their chronic conditions. The Economist points out that prescription medicines in America cost two to three times more on average than in other wealthy countries:

The blue dots are the price paid in the US for brand name drugs. The grey dots are prices paid in the various countries for all US drugs sold in those countries. The comparison of brand name to generics shows how much greater the cost is to an American. It also follows that US patients’ out-of-pocket expenses, (the slice of drug costs not covered by insurance), are among the highest in the world.

It’s understandable why Biden’s move to start negotiations on some of the most expensive drugs has been fiercely opposed by the pharmaceutical industry. Essentially, high US drugs costs underwrite what amounts to a subsidy for buyers of the same drug sold when it’s outside the US.

Many of the Big Pharma have jumped on the legal bandwagon, challenging price-setting provisions in the IRA. More from the Economist:

“Since the law’s passage over 50 companies have blamed the IRA in earnings calls for clouding their prospects.”

A quick primer on drugs. Most medicines are either small-molecule drugs or large-molecule drugs. The former are the kind of pills that line our medicine cabinets. Large-molecule drugs, (also called biologics), are more complex and must be injected. The IRA grants biologics 13 years of pricing freedom after a drug is approved, while small-molecule drugs get only nine years post-approval before they must face Medicare’s bean counters. The industry estimates that small-molecule brands could lose between 25% and 40% in overall revenue due to the earlier cap on prices.

PhRMA, the pharma Industry’s lobbyist argues (and Republicans back them) that high US prices reflect the high cost of drug development. The pharmaceutical manufacturers are, of course, suing to stop the price negotiations. They say that allowing the government to negotiate lower bulk prices for drugs will stifle innovation, and will cut funds for research.

One thing that Big Pharma wants to avoid showing us is that they rely on smaller, more agile biotech firms for ideas. Between 2015 and 2021, 65% of the 138 new drugs launched by Big Pharma originated mostly from smaller firms. So, while innovation isn’t totally gone from the big firms, what they’re mostly doing is marketing the intellectual property of small pharmaceutical firms.

It didn’t take long for Republicans to jump on the decision to allow Medicare to negotiate drug prices. From Politico:

“Piggybacking on the pharmaceutical industry’s strategy, Republicans are working to persuade Americans that the Biden plan will stifle innovation and lead to price controls.”

Politico quotes Joel White, a Republican health care strategist:

“The price control is a huge departure from where we have been as a country….It gets politicians and bureaucrats right into your medicine cabinet.”

Politico says that the GOP effort to reframe the drug price debate may hurt them, since they plan largely to run on inflation, while the Biden plan will lower drug prices. Also they quote a new poll from the Kaiser Family Foundation (KFF) that shows 58% of independent voters trust Democrats to lower drug costs compared with 39% of Republicans.

Our politicians and pundits have bleated at us for years about being an “exceptional nation” – but what we really are is exceptionally gullible. As long as the large healthcare and pharmaceutical companies insist on standing between American consumers and their health needs, maximizing their profit will always come first.

We also continue to elect leaders who lobby for keeping corporations unleashed so that they can make as much profit as possible, while saying that the “market” will decide where the public good is prioritized. This keeps us hopelessly mired in a grossly expensive, and often ineffective healthcare system.

We continue to let ourselves be convinced by corporations and our politicians that reforming healthcare is impossible. That the solutions and methodologies used by other developed nations are substandard, and/or somehow immoral.

The Hill reported that the 14 leading US drug companies paid out more in stock buybacks and dividends from 2016 to 2020 than they spent on research and development. Those firms spent $577 billion from 2016 to 2020 on stock buybacks and dividends, $56 billion more than the $521 billion they spent on R&D. So, it’s oblivious how Big Pharma could easily fund their R&D with lower drugs prices.

It is also useful to remember that America has more healthcare billionaires AND healthcare bankruptcies than any other country. Those two things are inextricably linked.

As long as the pharmaceutical companies can maximize profits by buying politicians rather than by charging higher prices in other countries – the American people are the ones who will continue to get screwed.

Ukraine War Reveals Our Broken Military Supply Chain

The Daily Escape:

Archangel Falls, Zion NP, UT – August 2023 photo by Torsten Hartmann Photography

The most important thing we’ve learned from the Ukraine War is that the US isn’t ready for a protracted war. One of the big reasons why, as The Insider says, America no longer builds weapons the way it used to. And we need to start building weapons again at tempo.

The Center for Strategic and International Studies (CSIS) has drawn a similar conclusion about US weapons manufacturing: There is no surge capacity and it will take years to revive it. According to their study, replacing the inventory of the critical items used in Ukraine, like 155 millimeter artillery shells, will take 4-7 years; Javelin missiles will take 8 years to replace; Stinger missiles 18 years. Before the Ukraine War broke out, the US was producing only about 14,000 155mm shells per year, enough for two days of fighting in Ukraine at current usage rates.

This scramble for ammunition reflects how ill-prepared the US and its allies are to sustain an intense and/or protracted land war.

Think back to America’s weapons building capabilities during World War II. We became an industrial powerhouse, cranking out warships and aircraft at a breakneck pace. One example: The Navy built ships in just weeks — its fleet grew from just 700 to over 6,000 over the course of the war.

The US maintained this capacity for decades but, as The Insider reports:

“Nowadays, it might take years to build a US Navy ship. The reasons for this are complex — shifted priorities, increased technology on board…labor costs — but the effect is clear: In a high-intensity conflict, the US would face challenges in not only producing vessels but also repairing any ships damaged in battle.”

These aren’t the only weapons that are in short supply. The Pentagon issued a study in April on the contraction of our Defense Contracting industry, which went from 52 primary contractors in the 1990s down to just six today. (full disclosure: Wrongo owns what is for him, a substantial number of shares in one of the six companies.)

During Clinton’s presidency, following the fall of the Soviet Union, Defense Secretary Bill Perry convened defense industry CEOs (known in the industry as the “last supper”) and told them that they should not assume production contracts would be maintained at Cold War levels, and they needed to diversify to survive. Many of the companies got out of defense production, and those that remained merged to secure market share of what became dwindling orders from the Pentagon.

This insured that US weapons suppliers wouldn’t be ready for a future that included China’s defense spending surge, the Russia-China strategic partnership, or today’s war in Ukraine.

Now, the Pentagon is revisiting whether industry consolidation has gone too far.

The WSJ reports that today, the industrial base of defense vendors is about 55,000 companies, down from 69,000 in 2016, and many of them are small firms. This smaller base has become a choke point as shortages of labor, chips, rocket motors and other components are stymieing efforts to boost arms production. The WSJ quotes Halimah Najieb-Locke, the Pentagon’s deputy assistant secretary of defense in charge of industrial-base issues, that the Pentagon:

“…is increasingly reliant on a smaller number of contractors for these critical capabilities….That impacts everybody’s ability to ramp production.”

These supply chain issues also dog the global arms manufacturing industry. US companies hold the first five spots in the top 10 ranking of arms sales, with China taking another four. The consolidated sales of the top five have fallen since the start of the Ukraine War.

Having this paradoxical slowdown in sales amid an increase in demand speaks to the larger challenges of a defense contractor base that is geared to peacetime production. The Defense Department has a role in this failure, since they rarely award contracts for multiyear procurements beyond current requirements. Air Force Chief of Staff Gen. CQ Brown said that the military hasn’t focused enough on keeping a steady flow of munitions production and procurement:

“In some cases, because you don’t have a threat on your doorstep, munitions aren’t…high on our priority list…”

Making the age-old point that sometimes, “just in time” isn’t. More from the WSJ: (emphasis by Wrongo)

“Lockheed and second-ranked Raytheon Technologies Corp. jointly produce…Javelin antitank missiles, but they expect it will take two years to double output that is now at around 400 a month.”

“Greg Hayes, chief executive at Raytheon, said that Ukraine has burned through five years of Javelin production since February and 13 years’ worth of Stinger antiaircraft missiles.”

Aerojet Rocketdyne is an example of a small but crucial cog in the defense industry. It builds the rocket motors used in the Javelin and Stinger missiles deployed in Ukraine. Labor and supplier issues have delayed its deliveries of rocket motors. Raytheon, who makes the Javelin along with Lockheed, said it will be 2024 before Aerojet catches up with engine orders.

The US is also facing a nearly $19 billion backlog in arms sales to Taiwan. Control of the Pacific would be a crucial part of any war with China, and Beijing has the world’s largest navy. According to a 2022 Pentagon report, the country has about 340 ships and submarines. The US, meanwhile, has fewer than 300 warships. Despite that, the US is committed to growing its fleet. Its number of ships is expected to increase to 350 by the 2040s.

To keep up with China, the US will need to build more ships and submarines more quickly. But it has a smaller number of shipyards and a skilled-labor shortage.

All of this will take money, billions of it. But we’re already first in the world’s defense spending. The worst military equipment is equipment that isn’t unavailable when it’s needed. That is not to say that the Defense Contractors should be given a blank check, but we are in dangerous times.

The US spends more on national defense than the next ten countries combined. Defense spending accounts for 12% of all federal spending and nearly half of US discretionary spending. The Defense Contractors are floating on a sea of profits from their captured Pentagon customer.

But is it better to spend extra dollars to have weapons inventory on hand than pay the much higher political cost of a military failure? Can those dollars be found within the existing defense budget rather than by adding to it? From a strategic viewpoint, shouldn’t we build capacity in peacetime when we don’t yet need it (while hoping never to), so that if the US does need it, the capital assets are in place?

The real issue is the stop/start government procurement process. We saw this in N95 mask sourcing, where domestic suppliers downsized over the years to a point where they couldn’t meet the surge in demand when Covid hit. After they ramped up, the government walked away from them when mask mandates ended.

This is also true in defense. Over the last 25 years, Congress has passed more than 120 Continuing Resolutions to fund the Pentagon instead of annual appropriations bills. With Continuing Resolutions comes chronic uncertainty for companies about when they’ll get paid, or when they can proceed to a new phase of weapons development or production.

Nothing is forcing the DOD to only do business with a small group of contractors (other than no one else bids on the contracts because the DOD won’t award to them). The issue is a shrinking domestic manufacturing base, and a lack of sustained business in the defense sector to support a larger field of competitors.

Market forces require efficiency. Sadly, efficiency comes at the cost of resiliency. National security priorities should deal with the stop/start issues that face our defense industry. In 2020, the National Defense Industrial Association’s report on the readiness of the Defense Industrial Base said 27% of critical defense supplier industries would likely experience shortages in the event of a surge in demand for combat-essential products.

And two years later, it happened in Ukraine.

Over the longer term, the US should develop an industrial reserve policy that pays companies to maintain excess capacity, such as warehousing critical, long lead-time parts. Much of today’s production challenges could be easily resolved by giving selected weapons or weapons systems a “protected” status, making them outside of the usual DOD acquisition and contracting rules that limit the flexibility and commitment needed to ensure a continuous production line.

This strategy would be expensive. But Russia’s war in Ukraine has reinforced the necessity of maintaining a deep inventory of weapons which we no longer have today. And it’s no longer a question of whether the US industrial base is prepared to rapidly surge production. It’s clear that we are not, because the necessary investments have not been made.

(hat tip to Brendan K. for his useful insights for this article)

Economic Illiteracy

The Daily Escape:

The confluence of the Green River (L) and the Grand River (R) form the Colorado River, Canyonlands NP, UT – July 2023 photo by Michael L Mauldin. In 1921, the Grand River was renamed the Colorado.

Wrongo doesn’t think that political polls have much value if they have a national focus, but still, he presents an Economist / YouGov Poll taken between July 8th and 11th of a nationwide sample of 1,500 adults (including 1,296 registered voters). The margin of error for adults is 2.8%, and for registered voters is 2.9%. They asked whether the country is in a recession:

Responses show that about 47% of adults and 48% of registered voters believe the US economy is currently in a recession. But, it’s not true.

We’re still seeing inflation: The BLS reported the Consumer Price Index was up 3% year over year in June. Inflation in June 2022 was 9% and it’s been falling ever since. It is now back near what the Fed says is its target for inflation, 2%.

But having inflation, even severe inflation, doesn’t mean we’re also in a recession. In fact, employment has continued to grow, even as economic growth has slowed. Growth has slowed from about 7% in 2021 to about 2% in the first quarter of 2023. But the economy isn’t shrinking. And the jobless rate in June was 3.6%, still at very low levels not seen consistently since the late 1960s. That would be 50+ years ago.

CNN quotes Justin Wolfers, an economics professor at the University of Michigan:

“We’re running out of time for a 2023 recession….We’ve never had a recession when the labor market was running this hot. In fact, it would be absurd to use r-word at a time when we’re creating jobs at this rate.”

Americans need to be taught economics. And also to read. It shouldn’t be so difficult to understand that the US economy is still humming along. Sadly though, most high schools don’t teach economics, and many college degrees don’t require it. This has resulted in economically ignorant adults (including voters) who just believe what lying politicians and an ambivalent media tell them.

The media’s endless ranting about inflation and recession has been a problem for Democrats. There’s plenty of economic unease and a lot of it is generated by so-called media “experts”.

People seem to want more concrete indications that we’ve turned a corner. But we’ve gone from ̶800,000 jobs a month to full employment. Isn’t that turning a corner? We’ve had real wage gains after 44 years of declining real wages: Isn’t that turning a corner?

If you’re not someone who pays much attention to politics and/or if most of your information is coming from mainstream media, this is what you remember hearing about the Biden presidency:

The economy sucks because nobody wants to work.
INFLATION!!
Home prices are rising, which is why YOU can’t afford one!
Home prices are falling, which is why YOU can’t retire!
GAS PRICES!!! OMG!
There’s going to be a MASSIVE recession any day now!

Every night since Biden took office, the media has blanketed us with some flavor of all of those narratives. Every night, every newscast.

But some of us say that it’s a complete mystery why Biden’s poll numbers won’t budge.

OTOH, the cost of housing is increasing year over year. Insurance premiums are increasing by double digits year over year. The plumber or HVAC guy costs way more. But since the headline rate of inflation is down, let’s all go out for steak and lobster tonight.

From a political perspective, shouldn’t the Democrats fulfill the wishes of the voters who think we’re in a recession by having one now rather than waiting until 2024? A recession next year would make the Biden reelection effort (along with the efforts to take control of the House and keep control of the Senate) less viable.

We’re a nation of economic illiterates who can’t figure out when the economy actually is good. Right now, they are telling pollsters that they’re doing okay, but the economy is terrible.

And since they vote, Democrats will do substantially better in 2024 with a soft landing rather than a mild recession, regardless of whether polls are still showing voters believe that the country’s in a recession.

We’re In Hot Water

The Daily Escape:

Harbor Seals hauling out on a buoy in Petersburg, AK. Wrongo and Ms. Right were passing by in a zodiac – July 2023 photo via the cruise line

It seems like it’s going to stay hot for a long while, and nobody wants to do anything about it. Temperatures are rising both on land and at sea, with climate experts ringing alarm bells about unprecedented sea surface temperatures:

“The National Oceanic and Atmospheric Administration (NOAA) in late June warned that half of the world’s oceans may experience marine heat wave conditions by September.”

And it’s hitting close to home:

“Not only is Florida sizzling in record-crushing heat, but the ocean waters that surround it are scorching, as well. The unprecedented ocean warmth around the state — connected to historically warm oceans worldwide — is further intensifying its heat wave and stressing coral reefs, with conditions that could end up strengthening hurricanes.”

The NYT reported that the water temperature around Florida hit 90° yesterday.

And while it’s possible to score cheap political points on their governor DeSantis who would rather fight with Mickey Mouse and whatever “Woke” means this week while ignoring climate change, Wrongo won’t stoop to that. He’s sure that Floridians love their governor’s priorities. Just last week, as insurance companies were pulling out of Florida, DeSantis was saying not to worry, the insurers will return to Florida after the hurricane season.

As Pogo said many years ago: “We have met the enemy and he is us.”

Primarily, the enemy is the Republican politician who continues to vote against efforts to bring the world’s CO2 levels under some semblance of control. The fixes to climate change that will have the most impact involve changes in public policy that will never happen as long as Republicans hold enough votes to block them.

But the big idea is that we’re not going back to where we were heat-wise, no matter what we do to cut further CO2 emissions. As NYT journalist Jeff Goodell said on NPR: (brackets by Wrongo)

“We are moving into a different world, and we need to grasp that idea….the planet is heating up…because we’re putting CO2 into the atmosphere…..It is essentially permanent when we put it [CO2] up there….And the warming will not stop until we stop emitting CO2 and burning fossil fuels….And even if we stop [adding more] CO2, we are stuck with that warming planet for a very long time.”

So, even if at this moment we made huge changes, we would always be on this part of the temperature scale, unless we figure out how to take quite a bit of that CO2 out of the atmosphere.

A few red state legislatures are considering following South Carolina’s lead and simply banning all mention of global warming or climate change in official documents or state-funded research. They think the only real way to deal with the climate problem is to ignore it.

Worse, nobody has a good model for what happens when all that warm water sits and gets warmer. Some meteorologists have pointed out that if the Caribbean got hot enough, it could spawn a continuous series of Category 5 hurricanes, say, once a week from May to October.

Which would resolve the problem of insuring Florida’s oceanfront properties pretty quickly.

It’s becoming evident that we live in a world designed for a climate that no longer exists. What’s really sobering is that the climate that now exists won’t resemble the one that will exist a generation from now.

How our societies and political systems deal with this is the central question of the 21st century.

Wrongo and Ms. Right moved back to New England from California partly because of climate. We were concerned about how scarce water would become in Los Angeles, and we knew that Connecticut would have more water for longer. This week, several of our roads and bridges closed because we had too much rain, causing the Housatonic River to overflow its banks.

This shows that there are no longer any places that can be marked safe from climate change. It has become impossible to predict the future climate/weather anywhere based on the past. And we’re still not coming to terms with just how hot and dangerous things are becoming. Or how fast it’s happening.

Let’s close the week with a wake up tune. Here’s “The Effects of Climate Change on Densely Populated Areas” by People Under The Stairs, a hip hop group from LA formed in 1997:

Sample Lyric:

Hundred degrees at midnight for the third day in a row
Nobody sleepin’ well and I can feel the tension growin’
LA wth rollin’ brownouts, rollin’ papers and rollin’ sixties
Heat exhaustion increasing caution across the city
Some people hit the mall, they’re tryin’ to stay cool
Some people call the cops; “there’s black children in the pool”
Everybody’s lookin’ sideways, we’re ragin’ on the highways
I hate it, I’m tryin’ to stay hydrated and faded but my way Is blocked
By road construction like a scene from “Falling Down”
Cops, they tryin’ to function but it seems they takin’ down us
Brown people at will People get hot and then killed
As the sun begins to set it’s hotter, no-one can chill
Everybody’s windows open there’s not a moment of silence
Alcohol heatin’ frustration that’s increasing domestic violence
9-1-1 is overwhelmed, homie, guess you on your own
The hills are still on fire, I recommend you stay at home

Saturday Soother – May 20, 2023

The Daily Escape:

Daffodils, Laurel Ridge, Litchfield CT – May 2023 photo by Dave King

The oil industry enjoys special economic status in the US. That is demonstrated by the tax breaks and outright subsidies we give them. Hannah Dunlevy notes that:

“In 2020, the explicit and implicit fossil fuel subsidies cost the United States $662 billion, around $2,006 per capita. Cutting just two tax breaks for the fossil fuel industry — the intangible drilling costs subsidy and the percentage depletion tax break — could generate $17.9 billion in government revenue over ten years, according to Congress’s non-partisan Joint Committee on Taxation.”

Biden’s fiscal year 2024 budget proposed cutting some of tax subsidies for oil and gas companies, which would save the US $31 billion over ten years. It will probably not survive the current Debt Ceiling and budget discussions.

One hidden subsidy that the oil industry enjoys is when wells are no longer productive – they are idled. If it’s no longer profitable to return idled wells to production, they need to be plugged. And the cost of plugging a well can be $100,000 or more.

The problem is that when wells start to decline, they are sold by Big Oil to smaller producers. When the well is sold, the plugging and cleanup liability passes to the new buyer. And often, the new buyer simply walks away from the uneconomic well, creating what the industry calls “orphaned wells”. But if a company doesn’t plug its wells before walking away, the cleanup costs will ultimately fall to taxpayers and current operators.

This has already happened with thousands of wells in California and may happen to millions more across the country. Pro Publica reports that there are more than two million unplugged oil wells scattered across the US. California is just the tip of the iceberg.

Petroleum reservoir engineer Dwayne Purvis laid out the reality at a recent conference. His research shows that more than 90% of the country’s unplugged wells are either idle or minimally producing and unlikely to make a comeback.

California is the canary in a coal mine. Shell and ExxonMobil recently agreed to sell more than 23,000 California wells which they owned through a joint venture, to a German asset management group IKAV for an estimated $4 billion. This means that a subsidiary of IKAV now owns about a quarter of California’s oil and gas production, largely in Kern and Ventura counties.

This ownership shift moves the subsequent environmental liability from Big Oil powerhouses to firms with smaller capitalization, increasing the risk that aging wells will be left orphaned, unplugged and leaking oil, brine and methane. For California and other states, this could repeat what was seen in coal mining, which led to taxpayers bearing all of the cleanup costs.

The oil industry has created layers of LLCs that are used to screen Big Oil from the dirty end of the oil business, like responsibility for cleaning up the messes that they make. And these firms can easily declare bankruptcy rather than pay for cleaning up orphan or idle wells.

ProPublica reports on an analysis by Carbon Tracker Initiative, a financial think tank that used the California regulators’ draft methodology for calculating the costs associated with plugging oil and gas wells and decommissioning them along with their related infrastructure.

The cost categories included plugging wells, dismantling surface infrastructure and decontaminating polluted drilling sites. That would cost California about $13.2 billion. Adding inflation and the price of decommissioning miles of pipeline could bring the total cleanup bill to $21.5 billion.

Meanwhile, Purvis estimates that California oil and gas production will earn only about $6.3 billion in future profits over the remaining course of operations; nowhere near sufficient to pay for the cleanup, even if those profits could be captured by the state.

That’s just California. These costs are what economists call “Externalities”. An externality is an indirect cost (or benefit) to a party (taxpayers) that arises as an effect of another party’s (Oil Companies) economic activity. The problem is that the price of their product doesn’t include the externalities. That means there is a gap between the profit of these corporations and the aggregate loss to society as a whole.

Republicans have a tried and true solution for this problem. Taxpayers pay the bills. We’re back to the “privatize profit, socialize the losses” game that corporations have played forever. Maybe the correct terminology should be socialism for the rich.

They prefer to call it keeping government off the backs of job creators.

Time to let go of California’s messy problem and find a few minutes to center ourselves before next week which will bring either financial Armageddon, or a diminished Biden. At the Fields of Wrong, we had a freeze last Wednesday that caused us to cover the newly planted vegetables and bring the Meyer Lemon tree indoors. Spring in Connecticut can always show up with a backtracking nod towards winter.

But on this rainy Saturday, grab a chair by a big window and listen to Debussy’s “Nuages” (‘Clouds’) from his “Trois Nocturnes”. Leopold Stokowski and the Philadelphia Orchestra made the first American recording of Debussy’s “Three Nocturnes” for a 1950 LP.

Here is the first “Nocturne”, a musical impression of slow-moving clouds:

The Wrongologist

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We’re In Hot Water

Saturday Soother – May 20, 2023