U.S. State GDPs Compared to Entire Countries

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It’s pretty difficult to even comprehend how ridiculously large the US economy is.

Click here to view the U.S. State GDPs Compared to Entire Countries map.

The map above (click to view and enlarge) matches the economic output (Gross Domestic Product) for each US state (and the District of Columbia) in 2018 to a foreign country with a comparable nominal GDP last year, using data from the BEA for GDP by US state (average of Q2 and Q3 state GDP, since Q4 data aren’t yet available) and data for GDP by country from the International Monetary Fund. Like in past years, for each US state (and the District of Columbia), I’ve identified the country closest in economic size in 2018 (measured by nominal GDP) and those matching countries are displayed in the map above and in the table below. Obviously, in some cases, the closest match was a country that produced slightly more, or slightly less, economic output in 2018 than a given US state.

It’s pretty difficult to even comprehend how ridiculously large the US economy is, and the map above helps put America’s Gross Domestic Product (GDP) of $20.5 trillion ($20,500,000,000,000) in 2018 into perspective by comparing the economic size (GDP) of individual US states to other country’s entire national output. For example:

  1. America’s largest state economy is California, which produced nearly $3 trillion of economic output in 2018, more than the United Kingdom’s GDP last year of $2.8 trillion. Consider this: California has a labor force of 19.6 million compared to the labor force in the UK of 34 million (World Bank data here). Amazingly, it required a labor force 75% larger (and 14.5 million more people) in the UK to produce the same economic output last year as California! That’s a testament to the superior, world-class productivity of the American worker. Further, California as a separate country would have been the 5th largest economy in the world last year, ahead of the UK ($2.81 trillion), France ($2.79 trillion) and India ($2.61 trillion).
  2. America’s second largest state economy—Texas—produced nearly $1.8 trillion of economic output in 2018, which would have ranked the Lone Star State as the world’s 10th largest economy last year. GDP in Texas was slightly higher than Canada’s GDP last year of $1.73 trillion. However, to produce about the same amount of economic output as Texas required a labor force in Canada (20.1 million) that was nearly 50% larger than the labor force in the state of Texas (13.9 million). That is, it required a labor force of 6.2 million more workers in Canada to produce roughly the same output as Texas last year. Another example of the world-class productivity of the American workforce.
  3. America’s third largest state economy—New York with a GDP in 2018 of $1.68 trillion—produced slightly more economic output last year than South Korea ($1.65 trillion). As a separate country, New York would have ranked as the world’s 11th largest economy last year, ahead of No. 12 South Korea, No. 13 Russia ($1.57 trillion) and No. 14 Spain ($1.43 trillion). Amazingly, it required a labor force in South Korea of 28 million that was nearly three times larger than New York’s (9.7 million) to produce roughly the same amount of economic output last year! More evidence of the world-class productivity of American workers.
  4. Other comparisons: Florida (about $1 trillion) produced almost the same amount of GDP in 2018 as Mexico ($1.19  trillion), even though Florida’s labor force of 10.2 million less than 20% of the size of Mexico’s workforce of 59 million.
  5. Even with all of its oil wealth, Saudi Arabia’s GDP in 2018 at $683 billion was below the GDP of US states like Pennsylvania ($793 billion) and Illinois ($863 billion).

Overall, the US produced 24.3% of world GDP in 2017, with only about 4.3% of the world’s population. Four of America’s states (California, Texas, New York and Florida) produced more than $1 trillion in output and as separate countries would have ranked in the world’s top 16 largest economies last year. Together, those four US states produced nearly $7.5 trillion in economic output last year, and as a separate country would have ranked as the world’s third-largest economy.

Adjusted for the size of the workforce, there might not be any country in the world that produces as much output per worker as the US, thanks to the world-class productivity of the American workforce. The map above and the statistics summarized here help remind us of the enormity of the economic powerhouse we live and work in.

So let’s not lose sight of how ridiculously large and powerful the US economy is, and how much wealth, output, and prosperity is being created every day in the largest economic engine there has ever been in human history. This comparison is also a reminder that it was largely free markets, free trade, and capitalism that propelled the US from a minor British colony in the 1700s into a global economic superpower and the world’s largest economy, with individual US states producing the equivalent economic output of entire countries.

This article is reprinted with permission from The American Enterprise Institute.

AUTHOR

Mark J. Perry

Mark J. Perry is a scholar at the American Enterprise Institute and a professor of economics and finance at the University of Michigan’s Flint campus.

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U.S. Adds Fewest Jobs This Year As Labor Market Cools

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The U.S. labor market cooled once again in September, adding the fewest jobs this calendar year, according to a Friday morning report from the Bureau of Labor Statistics (BLS), fueling investor hopes that the Federal Reserve might reduce the intensity of its anti-inflation campaign.

The U.S. added 263,000 jobs in August, slightly higher than investor expectations, a meaningful drop from August’s addition of 315,000, and half the 528,000 added in July, according to the BLS. The unemployment rate edged down to 3.5% in September, from 3.7% in August, with 5.8 million Americans currently unemployed, beating investor expectations.

The decline in job growth is another sign that the red-hot labor market is beginning to cool after job openings plunged 10% to 10 million in September from 11.1 million in August, according to a Tuesday BLS report. This slowdown is likely to be welcomed by investors, who hope that loosening labor conditions might prompt the Federal Reserve to reduce the intensity of its anti-inflation campaign, according to CNBC.

Members of the Federal Open Market Committee, the Fed group that sets its policy on interest rates, have been consistent in their messaging that high interest rates and elevated levels of inflation are expected to last at least another several months. The battle against inflation is still “in the early days,” said President Raphael Bostic of the Federal Reserve Bank of Atlanta, according to CNBC.

Wages grew by 5% over the past 12 months in September without accounting for inflation, according to the BLS. In August, wages were up 5.2% over the previous 12 months, without accounting for inflation, but once inflation and a reduction in the average hours worked were considered, earnings actually decreased by 2.8% in August, according to the Bureau of Labor Statistics.

“Despite the stronger wage growth due to the tightness of the labor market, a majority of workers are finding their wages falling even further behind inflation,” Fed researchers wrote in a Tuesday report on wage growth published by the Federal Reserve Bank of Dallas on Tuesday.

A small minority of workers saw significant real wage growth, while the proportion of workers who saw wages decline fell slightly from pandemic-era highs to 53.4%, the highest rate since 2011, the Fed researchers reported. Amongst those that saw wages decline, the median decline was 8.6%, far greater than the typical range of a 5.7% to 6.8% decline seen in the past 25 years.

Earnings data for September is due on Sept. 13, alongside inflation data in the Consumer Price Index (CPI), a measure of the inflation faced by typical urban households in the U.S.

AUTHOR

JOHN HUGH DEMASTRI

Contributor.

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The Biden Administration Just [Quietly] Scaled Back Student Loan ‘Cancellation’

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UPDATE: 

Student debt forgiveness is unjust, highly regressive, and inflationary. It should be scrapped, not scaled back.

In August, the White House announced that most federal student loan borrowers would be eligible for forgiveness. Most borrowers who didn’t receive a Pell Grant would be eligible for up to $10,000 of forgiveness, while borrowers who did receive a Pell Grant—a type of financial aid for low-income undergrads—would be eligible for up to $20,000.

In what NPR describes as a “remarkable reversal,” the US Department of Education last week “quietly changed its guidance around who qualifies” for student debt forgiveness under President Biden’s controversial executive order.

“At the center of the change are borrowers who took out federal student loans many years ago, both Perkins loans and Federal Family Education Loans. FFEL loans, issued and managed by private banks but guaranteed by the federal government, were once the mainstay of the federal student loan program until the FFEL program ended in 2010.

Today, according to federal data, more than 4 million borrowers still have commercially-held FFEL loans. Until Thursday, the department’s own website advised these borrowers that they could consolidate these loans into federal Direct Loans and thereby qualify for relief under Biden’s debt cancellation program.

On Thursday, though, the department quietly changed that language. The guidance now says, ‘As of Sept. 29, 2022, borrowers with federal student loans not held by ED cannot obtain one-time debt relief by consolidating those loans into Direct Loans.’”

NPR adds that the change could affect as many 1.5 million borrowers, noting that it’s “unclear why the department reversed” course.

While the Department of Education is mum on the sudden change, National Review suggests it may be a legal maneuver to strengthen the constitutionality of Biden’s executive order, which was recently challenged by attorneys general in Iowa, Kansas, Nebraska, Missouri, South Carolina, and Arkansas, which filed a federal lawsuit alleging that Biden’s unilateral order was unconstitutional.

The Pacific Legal Foundation has also filed suit, contending “that student-loan borrowers in states like Indiana, Wisconsin, Minnesota, Arkansas, and North Carolina would be unfairly taxed for the student-loan ‘forgiveness’ under President Joe Biden’s program.”

Few people, I suspect, could explain the difference between an FFEL loan or a Perkins Loan (I certainly couldn’t). But many rightfully question the constitutionality of the president of the United States unilaterally “canceling” with the stroke of a pen hundreds of billions of dollars in student loans, all of which will have to be paid by taxpayers who did not take out the loan or receive the service.

While I’ll leave the constitutional question to legal scholars, it’s clear student debt forgiveness is unjust, highly regressive, and inflationary.

Lawrence Summers, an economist who served in both the Clinton and Obama administrations, made it clear that Biden’s order would have inflationary consequences.

“Student loan debt relief is spending that raises demand and increases inflation,” Summers argued. “It consumes resources that could be better used helping those who did not, for whatever reason, have the chance to attend college. It will also tend to be inflationary by raising tuitions.”

While many will point out that government shouldn’t be “helping” those who didn’t attend college anymore than those who did, his observation that forgiveness will cause tuition prices to rise is spot on.

Second, even the Washington Post concedes that Biden’s plan is “a regressive, expensive mistake.” How regressive?

As Politico points out, a recent study by economists Constantine Yannelis and Sylvain Catherine “concludes that blanket forgiveness of $10,000 in debt would offer $3.60 to the highest-earning 10 percent of households for every $1 it gave to the bottom 10 percent and that three quarters of the benefits would flow to households with above-median incomes.”

Finally, some may argue that student debt forgiveness is unjust because it’s regressive. While they have a point, debt forgiveness would be unjust even if it was not regressive. As Brad Polumo recently wrote for FEE, loan forgiveness is a textbook example of what the nineteenth century economist Frédéric Bastiat described as “legal plunder.”

Polumbo explained that it’s no coincidence that Biden’s loan bailout was rolled out right before midterm elections in November, describing it as a “calculated attempt” to reward his voting base at the expense of the public treasury. This, Bastiat explained, is legal plunder.

“See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong,” Bastiat wrote in The Law. “See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.”

Bastiat warned that “sometimes the law defends plunder and participates in it.” Looting might be legal when the government does it; but it’s never moral, regardless of how many votes it buys or who the beneficiaries are.

Why the Biden administration is “scaling back” its student loan forgiveness order is anyone’s guess. What’s clear is that it should not just be scaled back; it should be scrapped.

This article was adapted from an issue of the FEE Daily email newsletter. Click here to sign up and get free-market news and analysis like this in your inbox every weekday.

AUTHOR

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. His writing/reporting has been the subject of articles in TIME magazine, The Wall Street Journal, CNN, Forbes, Fox News, and the Star Tribune. Bylines: Newsweek, The Washington Times, MSN.com, The Washington Examiner, The Daily Caller, The Federalist, the Epoch Times.

RELATED ARTICLE: Segregating Students by Age Is a Terrible Practice

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

Constitutional Crisis: Biden’s Student Loan Handout Could Cost $400 Billion, Congressional Budget Office Reports

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UPDATE: ‘FLAGRANTLY ILLEGAL’: Lawsuit Filed to Stop Biden’s Student Debt Cancellation

As Americans drown in Democrat incurred debt, they are ramping up more trillion dollar debt. President Biden’s move to cancel up to $10,000 in student loans for privileged borrowers (at the expense of the working class) — and up to $20,000 for others — will cost more than $400 billion, according to the nonpartisan Congressional Budget Office (CBO)

“By suddenly adding so-called student loan “forgiveness” to the November elections, President Joe Biden has used politics to paper over the constitutional crisis he precipitated. Under the Constitution, paying off federally insured student loans would be a presidential usurpation not only of the legislative power but also the appropriations power, the taxing power, and the “debting” power.”

Fox News: President Biden’s move to cancel up to $10,000 in student loans for many borrowers — and up to $20,000 for others — will cost more than $400 billion, according to the nonpartisan Congressional Budget Office (CBO). The CRFB also included in its estimate about $120 billion in costs to taxpayers from another element of the Biden’s executive order on “income-driven repayment,” which the CBO said it excluded. (Fox News). CBS News: The cost of the debt-forgiveness plan has sparked a debate among some Republicans and those without college degrees, who have argued that the plan isn’t fair to people who didn’t go to college but yet whose tax dollars will support the effort. After the report was issued, Republicans decried the plan’s price tag, citing the CBO’s forecast, with Rep. Andy Biggs of Arizona writing on Twitter that it was “even more expensive than we initially thought.” Even so, the CBO’s estimate is lower than an earlier forecast from the University of Pennsylvania’s Penn Wharton Budget Model, which pegged the cost at $519 billion (CBS News). National Review: More than 60 percent of Americans would oppose President Biden’s student loan “forgiveness” if it were to raise taxes, according to a new poll by the Cato Institute (National Review).

AUTHOR

Pamela Geller

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IRS Sent Out Over $1 Billion In Child Tax Credit Payments To The Wrong People

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The Internal Revenue Service (IRS) sent over $1.1 billion in child tax credit payments to incorrect recipients during the COVID-19 pandemic, according to an audit by the Department of the Treasury’s Inspector General (IG) for Tax Administration on Tuesday.

The IRS sent the payments to 1.5 million people between July and November of 2021 during the pandemic, according to the audit. Additionally, the IG noted that 4.1 million taxpayers did not receive payments they should have, amounting to $3.7 billion withheld.

The incorrect payments were made to recipients whose dependent children, required to claim the credit, did not meet the age requirements (i.e., under 18 years old), were deceased, or had been claimed on another filer’s return. These were a small proportion of the 178.9 million child tax credit payments made during the period, totaling $76.7 billion.

Additionally, the report noted that the IRS incorrectly sent out 6,829 reconciliation letters to taxpayers who received the credit, a document required to prepare their 2021 tax returns. Some taxpayers never received the letter, while others received letters with incorrect amounts.

The report further noted that the IRS erroneously changed 1,610 taxpayers’ bank account information used to receive direct deposits of the credit.

The payments were made under provisions of the American Rescue Plan Act, President Joe Biden’s main legislative response to the pandemic. The Act increased the annual amount of the tax credit by $1,000 to $1,600 per child, while, significantly, making the credit fully refundable and eligible to be claimed in advance by up to 50%.

Child tax credit payments were just one of Biden’s efforts to give taxpayers cash at a time when precautionary lockdowns were still in place in many states, along with the Paycheck Protection Program for businesses and stimulus checks for individuals. These programs were widely criticized by Republicans, who claimed that they would increase both the federal budget deficit and inflation, resulting in the Act receiving no GOP House support.

Ever since the Act’s passage, Republicans in Congress have used instances of incorrect payments, and amounts unspent, to criticize the Biden administration.

“We have cataloged numerous examples of ridiculous waste of federal tax dollars from the American Rescue Plan,” said Republican Rep. Jason Smith of Missouri, the ranking member of the House Budget Committee, during a hearing in June.

The Daily Caller News Foundation has reached out to the IRS for comment.

AUTHOR

ARJUN SINGH

Contributor.

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The On-Going Plot to Reduce Global Population

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According to Kelleigh Nelson’s News with Views article of March 22, 2022, “The Homicidal Killing Fields of America’s Medical System,” her extensive research  confirms that what we are currently experiencing has been in the planning stage for at least two decades.

Its purpose was to establish a crisis, through fear, by which the public mindset would accept the existence of a pandemic that would completely endanger our health globally, and provide the excuse for destroying all current law. However, there is much evidence that what was chosen (a virus – COVID-19) to initiate the outset of the “pandemic,” very possibly doesn’t even exist.

The reason I use the word, “possibly” is because I can’t positively confirm all existing intelligence.  However, the best I have found is contained in an article by Jon Rappoport, published in the Peoplesvoice.org, on January 29, 2021.

According to Rappoport, “There is no Covid pandemic.” He points out that the whole notion that Covid-19 is one health condition is a lie. COVID is not one thing.

He states that this the most difficult and yet the simplest point to accept and understand and that we shouldn’t reject the existence of the virus and then say, “So what is the cause of people dying?” His response to that is, there is no ONE CAUSE. There is no one illness. There is no “it.”

The article continues…Rappoport states that none of the “COVID deaths” in the entire world require the existence of a new virus. For instance, in Wuhan, where the whole business began, the first COVID cases of pneumonia occurred in a city whose air is heavily polluted. In China, every year, roughly 300,000 people die from pneumonia. That means millions of cases. None of these deaths need to be explained by invoking a new virus.

He continues, “Add to this the fact that the PCR test for the virus is irreparably flawed and useless.” (For a variety of reasons, I have explained in other articles.) The test spits out false positives like a fire hose. Thus, the high case numbers. The authorities have to go to such extremes to paint a picture of a spreading viral epidemic…in order to plant fear and thus compliance in the citizenry. However, there is no evidence that an actual germ is traveling around the world felling people. The ‘evidence’ is invented.

The” pandemic” is invented.

The fraud is promoted.

And, if you think there are other major reasons to explain “why all these people are dying,” keep in mind that “lung” conditions are an expanded category worldwide. For instance, there are about one billion cases of flu-like illnesses every year on planet earth. Repackaging/relabeling just a small percentage of those cases alone would account for all official COVID death numbers.

But we have known for some time that the “Agenda” for world government has been planning, for three or four decades, something comparable to what we are experiencing currently.  The so-called “pandemic,” which is fueled by something called COVID-19, very probably doesn’t exist except in propaganda and in the minds of the people.

According to Kelleigh Nelson’s News with Views article of February 8, 2020, “Mass Murder by a medical System that has Lost its Direction and Soul” she states that the AMA, CDC, FDA, NIH protocols for treatment of patients with COVID have saved no patients; they have purposely murdered hundreds of thousands, perhaps millions, who could have been saved. She makes a point, “That the dissident doctors, scientists and healthcare workers know that there are repurposed drugs (inexpensive and available) that could have saved up to 86% of those who perished.”

Following is a list of comments relative to the above.

“People were dying, (yet) all my ideas were getting shouted down. My superiors were showing up (to my clinical meetings) and getting me to stand down, because I was entertaining the idea that we should do this, that and the other thing, and they didn’t want anything to be done.” – Dr. Pierre Kory

“This is a war on cheap repurposed drugs.” – Dr. Paul Marik before testifying on NH bill that would make ivermectin available OTC in NH.

“I never thought I’d see the day where doctors are censored, and patients are kept from care.” – Dr. Peter McCullough.

As we have observed, practically all hospitals are in lockstep with everything that is being carried out by the forces behind this so-called pandemic. We know this is true because of the evidence given by dissident doctors, scientists, healthcare workers and parents or families of patients who failed to survive their hospital stay. The hospital protocols were used to further their goal of diminishing the global population.

Also, the hospitals are given monetary incentives by the government to label all illnesses as Covid. This, of course, results in the enhancement of the number of C-19 cases reported daily across the country and figures into the national mind set of the acceptance of existence of a “pandemic.”

Additionally, the hospitals are given bonuses for deaths from “COVID” or listed as COVID, but nothing for those who survive. So, we can imagine what the incentive leads to, hundreds of thousands of dollars.

A Case in Point

This brings me to an ordeal experienced by Beth, my wife’s niece, whose son Jonathon, was in a hospital with “COVID.” She kept a daily journal of her son’s progress, which to all appearances, even though he was on an ECMO (extracorporeal membrane oxygenation) Machine, was daily improving.  He was able to participate in physical therapy and occupational therapy.  She had videos confirming this.

All this transpired over a period of about three months.  Toward the end, she was told that they might have to remove the ECMO machine to be used with patients who had been vaccinated, which her son had not. Later, when this came about, it resulted in him having trouble breathing, in fact, he was gasping for breath. For this they began giving him shots to stop the gasping.

She was informed by the staff that this was why the shots were being administered, to which she replied that “she didn’t want him to be gasping for breath,” because she wanted him to at least have the opportunity to try to live. In the response, the doctor said, “If he gets this miracle, it doesn’t matter what I do.” But when the gasping stopped – after the 4th injection he was dead.

So, now comes the aftermath.

Beth is tough, both mentally and emotionally. But she’s been through a lot recently. She lost both parents in a short period of time, then came the loss of her son. It’s been a lot of heartbreak and stress. At the very outset, upon arriving at the hospital she requested that he be given ivermectin, hydroxychloroquine (HCQ), or other repurposed drugs, but of course, that didn’t happen. Since the repurposed drugs were denied, what do you think he was given instead? It very well could have been Paxlovid which is worthless, or Remdesivir, which, according to reports, is very expensive as well as deadly.

I’ve talked with her three times to prepare to give an account of all this in order to present to others. She is convinced that her son was murdered, even though the hospital staff was only obeying the protocols handed down by the insiders at the top, you know who they are…the AMA, CDC, NIH, FDA etc.

We could say that the hospital staff only takes on the alter ego of the hospital, which also takes on the alter ego of all the powers at the top. They follow what they’re told to do in order to keep their jobs, even if they know what they’re doing is not normal or right.  Never mind the fact that the ECMO machine was taken from her son and given to a vaxed patient and would not help the vaxxed patient to survive. It is probable that the reason the other patient was in the hospital was due to the COVID injections. In this case, as in others, the hospital wouldn’t help them survive, even if it was possible, as they receive no monetary benefits for those who survive.

The amount of evidence is endless that the vaccine was designed purposely to either kill or seriously injure. The obvious outcome is the depopulation of America and the entire world.

All this plays into the agenda of the great reset by the invisible government which is the Council on Foreign Relations (CFR).  All the components of it, the United Nations, the Democratic Party, The World Economic Forum (WEF), and the socialist sleepers who have infiltrated the Republican Party, and many others are having their day, but it will be short lived. Just when they believe they have everything under complete control and everything nailed down so that nothing can stop them, something is going to play into the Lord’s time-table which will result in their total destruction.

A few years prior to that something will have played into His plans that brought about that blessed day when the Lord himself, will have descended from heaven and with a shout, “With the voice of the archangel, and with the trump of God, and the dead in Christ shall rise first.”

“Then, we who are alive and remain shall be caught up together with them in the clouds, to meet the Lord in the air and so shall we ever be with the Lord.”

And this is the day that Beth will be looking forward to with total assurance that a joyful occasion will transpire when she is reunited with her son, Jonathon.

Conclusion

Beth isn’t the only one who is experiencing this; we know that there are many thousands, maybe even millions, who are going through much heartbreak as a result of the protocols being ordered by the medical authorities and the federal government to continue this façade of a pandemic using fear to control the masses.

And it will get worse. So, we need to prepare for whatever comes, and the only way I know that we can do it is to grow stronger in our faith and dependance upon God to see us through all the travails that are forthcoming.

Please, share this article with as many as possible.  The time is close at hand.

©J.W. Bryan. All rights reserved.

2022 Now The Worst Year in the History of U.S. Stock Market

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Stock futures are falling. On Friday, U.S. stocks ended in the red, with the Dow Industrials closing down 1.6% and all major indexes posting weekly losses.

On Monday, the British pound hit its lowest-ever level against the U.S. dollar and was sharply lower against the euro. Yields on benchmark U.K. bonds have jumped to fresh multiyear highs.

AUTHOR

Pamela Geller

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Economic Freedom Plummets in the U.S. During Biden Rule, New Ranking Shows

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Economic freedom in the U.S. drops to its lowest point in four decades.

The Democrats hate you and wish to destroy every good thing, every joy this fine country had to offer. The daily social fabric of our lives is disintegrating at whiplash-inducing speed.

Get out and vote in November. We must overwhelm the tallies to thwart these election fraud criminals.

Economic freedom in the US has declined significantly, new ranking shows

By: Eric Cervone, The Blaze, September 18, 2022:

The United States is significantly less free economically than it was a year ago, according to the Canada-based think tank Fraser Institute.

Each year, the Fraser Institute releases a report entitled “Economic Freedom of the World,” a ranking of countries around the world by economic freedom. This year’s ranking uses data from 2020 to order countries from most free to least free. The ranking is calculated using numerous factors, including size of government, respect for property rights, freedom to trade, monetary policy, and regulation.

“When you talk about economic freedom, you’re talking about people being free to trade with others, compete in markets, and keep what they earn,” said Florida State University economics professor James Gwartney, who co-authored the report. “Economic freedom is about people being free to mold and shape their own lives.”

The United States slots in at 7th place, down one spot from last year. But the U.S.’s score dropped more significantly, down from 8.25 to 7.97 on the index’s 10-point scale. The reason why America lost only one spot in the rankings is because economic freedom around the world fell in 2020, according to the Fraser Institute. The report shows that the average economic freedom rating fell to 6.84 in 2020, down from 7.00 in 2019, “erasing about a decade’s worth of improvement in economic freedom in the world,” the report states. However, average economic freedom is still up compared to 2000.

Keep reading….

AUTHOR

Pamela Geller

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Fearing Fed, Stocks Tumble And Major Investor Slashes Expectations

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All three major U.S. stock indices fell Friday morning as investors worried that the Federal Reserve’s ongoing campaign of aggressive interest rate hikes would weaken the economy.

With Friday poised to be the fourth day in a row of slumping stocks, the Dow Jones Industrial average fell by 1.36%, the S&P 500 by 1.7% and the Nasdaq Composite fell by 2%, according to CNBC. Investors’ fears followed a late Thursday announcement by Goldman Sachs analysts, who slashed their year-end expectations for the S&P 500 by 16%, according to Reuters.

“Based on our client discussions, a majority of equity investors have adopted the view that a hard landing scenario is inevitable and their focus is on the timing, magnitude and duration of a potential recession and investment strategies for that outlook,” David Kostin, an analyst at Goldman, wrote in the note, according to Reuters.

This follows a Goldman Sachs note released earlier this week, which warned that the Fed was unlikely to relent from its pace of interest rate hikes, even in the event of a so-called “soft landing” where inflation is managed without inducing a recession. Fed Chair Jerome Powell has been clear that the agency will continue rate hikes until inflation is brought under control, and is well on its way to the Fed’s target of 2% annually.

Goldman’s earlier note predicted that the Fed would continue raising rates at least through the end of the year, with a 0.75% interest rate hike in November and a 0.5% interest rate hike in December. Central banks around the world, even some that previously had negative interest rates, have been aggressively pursuing rate hikes as inflation hammers economies worldwide, according to The Wall Street Journal.

AUTHOR

JOHN HUGH DEMASTRI

Contributor.

RELATED VIDEO: Clay Travis: 1.4% to 8.3% inflation under President Biden

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RELATED ARTICLE: ‘Until Something Goes Wrong’: Goldman Sachs Warns Investors High Rates Are Here To Stay

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Key Inflation Indicator Remains Sky-High In Another Worrying Sign For Businesses

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The prices faced by producers rose by 8.7% year-on-year in August as inflation continues to challenge businesses, according to the Bureau of Labor Statistics (BLS).

While down from the near-record highs of 11.3% in June, the current price increases were over 4 times the typical rates — between 1 and 3% annually — seen in 2019 and 2020, according to data from the Bureau of Labor Statistics’ Producer Price Index (PPI), which measures the prices suppliers charge businesses and other customers. These elevated rates mirror Tuesday’s Consumer Price Index (CPI), which pegged inflation at 8.3%, according to the BLS.

A significant component of the decrease was accounted for by a 5.2% decline in energy costs, according to the BLS. Mirroring July’s results, the index for foods and all goods less food and energy rose by 0.1% and 0.2%, respectively.

The index for all products other than foods, energy and trade services rose by 5.6% year-over-year,  less than the 5.8% posted in July, according to the BLS. The price for unprocessed goods was still incredibly elevated, at 36.1%, more than July’s value of 30.4%, as a spike in the price of natural gas kept prices up.

The Biden administration has been taking a victory lap on economic conditions, with Treasury Secretary Janet Yellen claiming the economy had undergone one of the fastest recoveries in modern history. President Joe Biden claimed that the passage of the Inflation Reduction Act had helped to combat inflation “at the kitchen table,” in a Tuesday speech at the White House.

Simultaneously, the BLS’ monthly CPI report placed inflation at 8.3%, and found that food prices had increased 13.5% annually. Rent and electricity were also up, 6.7% and 15.8% respectively.

Increased rent prices have put pressure on families in particular, with the average cost of a single family rental home up about 13.4% this year, according to CNBC. At a median cost of $2,495 per month, families who might otherwise save to purchase a house are being priced out of home ownership, CNBC reported.

Gas prices also remained incredibly elevated, despite having fallen 12.2% month-on-month, and were still up 25.6% compared to the same time last year, the BLS reported.

AUTHOR

JOHN HUGH DEMASTRI

Contributor.

RELATED ARTICLE: Food Prices Hit 40-Year High, Keep Breaking Records Every Month

EDITORS NOTE: This Daily Caller column is republished with permission. ©All rights reserved. Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.

8 Ideas That Will Teach You to Think Like an Economist

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Sound economic thinking is vital for a prosperous future.

Economics is the study of human action—the choices people make in a world of scarcity. Scarcity means that people have unlimited wants but we live in a world of limited resources. Because of this fact people have to make choices, and choices imply trade-offs. The choices people make are influenced by the incentives they face and those incentives are shaped by the institutions—rules of the game—under which people live and interact with others.

The Foundation for Economic Education has published some excellent essays on the economic way of thinking and basic concepts (“The Economic Way of Thinking” by Ronald Nash and “Economics for the Citizen” by Walter E. Williams).

In this essay, I will explain eight ideas and give examples of the economic way of thinking.

We often hear how wonderful certain countries are because they provide “free healthcare” or “free education.” Many will also say “I got it for free” because they didn’t pay with money.

The error lies in not understanding the difference between price and cost. For example, people usually say, “The Starbucks latte cost me five dollars” or, “The movie ticket cost me fifteen dollars.” Cost in economics means what you give up or sacrifice. In these examples, the prices were $5 and $15. But the cost of the latte was perhaps the sandwich one could have purchased instead with that same $5, and the cost of the movie was perhaps the three lattes one could have purchased instead with that same $15.

Labeling healthcare and education “free” is not just wrong—”there’s no such thing as a free lunch”—it’s also misleading. As my former professor Walter E. Williams would say, “Unless you believe in Santa Claus or the Tooth Fairy, the money has to come from somewhere.” You might not get a medical bill in those countries but you have more taken out of your paycheck (i.e., taxes) and you might have to wait much longer to get that test or have that “minor” (from the bureaucrats’ perspective) surgery. You pay with either money or time, but either way, you pay! Taxes are also used to pay for public schools, which is yet another example of how people call something “free” when it is not.

There’s a difference between zero price and zero cost. There could be a zero price ($0), but there’s never a zero cost. Therefore, don’t swear anymore by using the “F” word!

“Actions speak louder than words,” is a well-known idiom. Humans act, and the act of choice tells us something. Consider this example: A person walks into an Apple store and sees the price of the latest iPhone and angrily mumbles, “What a rip off” but still proceeds to purchase that phone.

When one does something voluntarily, it demonstrates their true preference at the time. Assuming that individuals are self-interested and will ex ante (looking forward in time) subjectively weigh the cost and benefit of an action, and, also assuming it’s not a right to have the private property of another (i.e., Apple’s iPhone), then when a person walks into an Apple store and buys the new iPhone, the individual obviously expects to be better off in some way at that moment. To say that Apple “took advantage” of the willing customer would be nonsense since Apple, or any private business, cannot force people to buy their product. It’s one thing to say something, but the proof is in the act of choice.

“Don’t cry over spilt milk” means what’s done is done. The only costs that should come into our decision-making are future opportunity costs. Past costs are “sunk.” The typical example to explain the sunk cost fallacy is the movie example. You spend $15 to see a movie and an hour into this three-hour movie you realize that it’s horrible and will only get worse. However, your feeling is that you should stay and get your money’s worth. That is bad economic thinking. The $15 is gone so don’t lose the next two hours of your valuable time—get up and leave.

Most of us know people who were (are) in a horrible relationship or dating the wrong type of person (perhaps this applies to you). But the feeling of “I’ve already spent two years of my life with this person” can lead to a bad decision. Many end up marrying the person in order to justify the investment of time.

No offense to Beyoncé, but if you like yourself, then perhaps don’t let that person “put a ring on it”! Don’t lose the next two years of precious time. It’s better to be single than in a bad relationship (but that’s for another essay).

The optimal or efficient level of pollution is not zero. The optimal number of traffic deaths or sports injuries also is probably not zero. The optimal number of people getting a virus is not zero. The optimal level of safety is not perfect safety. Does this sound strange or harsh? Well, if you want to do a cross country road trip and not walk or ride a bike, or if you want to enjoy playing or watching sports, and if you want to physically interact with others, then it is clear that the optimal level of pollution, deaths, injuries, and people getting a virus is actually greater than zero. The optimal level of safety is less than perfect safety. Nothing is free including more safety—trade-offs are always involved because there is always an opportunity cost when we do something, even things like travel, play sports, or interact with others.

Incremental decision-making is what economists call thinking at the margin. Marginal means the one additional or extra unit. Every time we make a decision it’s as if we are calculating the marginal benefit (the benefit of one more unit) and the marginal cost (what would be given up to acquire one more unit) of the action. The economic way of thinking says something should be done until the marginal benefit (MB) equals the marginal cost (MC). There’s also a concept known as the law of diminishing marginal utility—each additional unit gives less and less utility or benefit.

We want clean air so that our eyes aren’t irritated when we go outside and our lungs don’t burn when we take a breath. However, if the desire is perfectly clean air this would mean no more cars, no planes, no boats or ships, and no trains (some would actually desire this situation, at least theoretically). This would impose tremendous costs on society.

Let’s look at it another way. If I snapped my fingers and made the Pacific Ocean perfectly clean but then put one drop of oil somewhere in the ocean unbeknownst to everyone else, would it be worth it to spend money, time and other resources to hunt down that one drop of oil? The marginal benefit of finding and removing one drop of oil in the quintillions of gallons of water would be less than the marginal cost. In plain English, it’s not worth it. Again, the optimal level of pollution is some, not zero.

When it comes to studying, practicing a sport or musical instrument, or dating someone before marrying them, you might think, “The more time, the better.” I am a literal person so if I told my students, “The more you study the better,” this would mean they would never eat, drink, sleep, or spend time with family and friends. But common sense says that after studying for a certain amount of time most students will say, “I get it” or simply “time to move on.” Why waste more time studying?

Also, if you are in a place in your life where you are considering marriage, then the point of dating is to acquire information about the other person so that you can make a good decision. Ultimately, you come to a point where you have enough information to propose, accept a proposal, or break up with this person. When I proposed to my wife, I did not have perfect information about her, but my information was good enough. Sure, one more month of dating would have given me some marginal benefit in terms of additional information about her, but I came to a point where I had enough information—where MB=MC.

“Good enough is good enough” is what economists mean by doing something until the marginal benefit equals the marginal cost. The MB=MC rule implies that the “more is better” thinking is not optimal. One aspirin from the bottle can help your headache but it’s dangerous to think, “Well, if one is good, the whole bottle is better.” Yes, your headache will be gone but so will you.

In a standard economics class, students are taught absolute advantage and comparative advantage. The former means being able to produce more than another with the same amount of resources or using fewer resources to produce an output. The latter means being able to do something at a lower opportunity cost than another.

Because there’s always an opportunity cost when doing something, sometimes it is advantageous to pay someone else to do something even if we have the knowledge and skills to do it ourselves. This also has applications to trade policy. Just because the United States (actually individuals in the United States) can produce certain products does not mean we should. It’s ok if not everything we buy says “Made in USA” because if the government tries to “protect American jobs” and begins imposing tariffs and quotas, we are not actually saving American jobs. It’s more correct to say we are saving particular jobs at the expense of other American jobs. Of course, good politics and good economics often go in different directions.

The complaint that businesses can charge “whatever they want” is nonsense. For example, why is it that movie theaters only charge $8 for popcorn and not $8,000 or $8,000,000 if they can supposedly charge whatever they want? There are two sides to a market transaction, and it’s this interaction of sellers and buyers that determines the price. What’s interesting is that many times the same people complaining are the ones making noise eating that popcorn during the movie.

Entrepreneurs become wealthy if they create a product or service that provides value for a large number of people. Unless the entrepreneurs received special privileges from the government, they didn’t forcibly take money from their customers.

The anger directed at “the rich” is based on the fallacy of thinking the economy is a fixed-size pie. In other words, those who criticize the “filthy rich” believe that they took a piece that was too big, leaving less pie for the rest of us regular folks. The reality is that these entrepreneurs baked a bigger pie. They benefited, but so did we!

In a business transaction, exchanges are voluntary, and voluntary trade is a win-win situation. The entrepreneur wins (as well as the employees he or she hires) and the customers win.

Intentions and results are not always the same thing. The economic way of thinking teaches us to consider possible unintended consequences of our own actions or the actions of politicians. Just because something sounds good or feels right does not mean a certain goal will be achieved. In fact, the very problem that is being addressed can become worse.

Sound economic thinking also removes one’s blinders. The effects of a policy on all groups are considered, not just one group. This helps individuals to see through politicians’ claims that a policy will save American jobs when in reality only some special-interest group will benefit at the expense of other Americans. When politicians confiscate money (i.e., taxes) to build sports stadiums using the “it will create jobs” argument, the mistake is to focus on the jobs seen and neglecting the unseen—the opportunity cost of those tax dollars.

There is so much more to say about this subject called economics and there are many more examples of the economic way of thinking that I could have included. Some characterize economics as applied common sense; yet, economics also gives us counterintuitive insights.

This is the power and beauty of economics

AUTHOR

Ninos P. Malek

Ninos P. Malek is an Economics professor at De Anza College in Cupertino, California and a Lecturer at San Jose State University in San Jose, California. He teaches principles of macroeconomics, principles of microeconomics, economics of social issues, and intermediate microeconomics. His previous experience also includes teaching introductory economics at George Mason University.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

Charging an All Electric Car Uses 4 Times the Electricity of a Home Air Conditioner

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Watch as Congressman Thomas Massie (R-KY) puts Biden’s Secretary of Transportation Pete Buttigieg on the spot during a hearing on the cost to charge all electric vehicles on Tuesday, July 18th, 2022.

Congressman Massie states, “Numbers are important. It would take four times as much electricity to charge the average household’s cars as the average household uses on air conditioning. Do you think that could be — so, if we reach the goal by 2030 that Biden has of — of 50 percent adoption instead of 100 percent adoption, that means the average household would use twice as much electricity charging one of their cars as they would use for all of the air conditioning that they use for the entire year.”

Tesla Model charging
Tesla Model Energy required to charge battery (kWh) End charge of battery (kWh)
Model 3 Long Range 88.541 kWh 78.557 kWh
Model 3 Performance 94.242 kWh 80.818 kWh
Model S** 118.366 kWh 103.892 kWh
Model S Plaid 116.344 kWh 99.287 kWh

NOTE: Most air-conditioning units run on a cycle of 15 minutes twice per hour. The actual power consumption is at 7.7kWh.

CLICK HERE: Access the Global Energy Tracker on CFR.org

In a December 21st, 2021 column titled Electric Cars vs. Gas Cars: Is the Conventional Wisdom Wrong? Bill Wirtz reported,

Electric vehicle batteries need a multitude of resources to be manufactured. In the case of cobalt, the World Economic Forum has called out the extraction conditions in the Democratic Republic of the Congo, where more than half of the world’s cobalt comes from. Miners as young as seven years are suffering from chronic lung disease from exposure to cobalt dust. Not only does battery manufacturing account for 60 percent of the world’s cobalt use, but there are also no good solutions to replace it, which is something Elon Musk is struggling with.

This does not even address the extraction procedures, complications, ethical conditions, and emissions produced by the need for aluminum, manganese, nickel, graphite, and lithium carbonate.

With a European market estimated to reach a total of 1,200 gigawatt-hours per year, which is enough for 80 gigafactories with an average capacity of 15 gigawatt-hours per year, that need is set to increase exponentially.

The renowned German research institute IFO declared the eco-balance of diesel-powered vehicles to be superior to electric vehicles in a study released in April.

In an April 7th, 2022 column titled The Environmental Downside of Electric Vehicles Michael Heberling reported,

An electric vehicle requires six times the mineral inputs of a comparable internal combustion engine vehicle, according to the International Energy Agency.

At one time, “Saving the Environment” and “Fighting Climate Change” were synonymous. That is no longer true. The quest for Clean Energy through electric vehicles (EVs) epitomizes “the end justifies the means.”

According to the International Energy Agency (IEA), an electric vehicle requires six times the mineral inputs of a comparable internal combustion engine vehicle (ICE). EV batteries are very heavy and are made with some exotic, expensive, toxic, and flammable materials.

The primary metals in EV batteries include Nickel, Lithium, Cobalt, Copper and Rare Earth metals (Neodymium and Dysprosium). The mining of these materials, their use in manufacturing and their ultimate disposal all present significant environmental challenges. Ninety percent of the ICE lead-acid batteries are recycled while only five percent of the EV lithium-ion batteries are.

The Bottom Line

All electric vehicles (EVs) are costly to manufacture, use exotic, expensive, toxic, and flammable materials, harm the environment and harm those children working in the mines in the Democratic Republic of the Congo, where more than half of the world’s cobalt comes from.

Now we learn that Biden’s Secretary of Transportation Pete Buttigieg has not idea what it costs the ordinary American family to own, charge and maintain EVs. If you purchase a Tesla is will cost $45 for their outlet, and an estimated  installation cost of between $750-$1500.

You see it’s not about the environment, saving the planet from climate change or what is best for the American family.

It’s all about their green agenda and its ideology. The ends justifying their nefarious means!

The American consumer be damned.

©Dr. Rich Swier. All rights reserved.

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There’s 1 Big Problem with Any ‘Climate Emergency’ Biden Might Declare

Data Show California Is a Living Example of the Good Intentions Fallacy

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“Concentrated power is not rendered harmless by the good intentions of those who create it.”

During a speech at Harvard several years ago, Charlie Munger related a story about a surgeon who removed “bushel baskets full of normal gallbladders” from patients. The doctor was eventually removed, but much later than he should have been.

Munger, the vice chairman of Berkshire Hathaway, wondered what motivated the doctor, so he asked a surgeon who participated in the removal of the physician.

“He thought that the gallbladder was the source of all medical evil, and if you really love your patients, you couldn’t get that organ out rapidly enough,” the physician explained.

The doctor was not motivated by profit or sadism; he very much believed he was doing right.

The anecdote is a perfect illustration of the righteousness fallacy, which Barry Brownstein noted is rampant in modern politics and a key driver of democratic socialism.

The Righteousness Fallacy (also known as the fallacy of good intentions) is described by author Dr. Bo Bennett as the idea that one is correct because their intentions are pure.

It recently occurred to me that California is a perfect example of this fallacy. Consider these three facts about the Golden State:

  1. California spends about $98.5 billion annually on welfare—the most in the US—but has the highest poverty rate in America.
  2. California has the highest income tax rate in the US, at 13.3 percent, but the fourth greatest income inequality of the 50 states.
  3. California has one of the most regulated housing markets in America, yet it has the highest homeless population in American and ranks 49th (per capita) in housing supply.

That politicians would persist with harmful policies should come as little surprise. The Nobel Prize-winning economist Milton Friedman once observed the uncanny proclivity of politicians “to judge policies and programs by their intentions rather than their results.”

In his book Capitalism and Freedom, Friedman described the danger of such thinking.

[The threat comes] … from men of good intentions and good will who wish to reform us. Impatient with the slowness of persuasion and example to achieve the great social changes they envision, they’re anxious to use the power of the state to achieve their ends and confident in their ability to do so. Yet… Concentrated power is not rendered harmless by the good intentions of those who create it.

I don’t doubt that California lawmakers, like the physician who was removing healthy gall bladders, believe they are doing the right thing. Yet they, like the physician, need to wake up to reality and realize they aren’t making people better.

AUTHOR

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. His writing/reporting has been the subject of articles in TIME magazine, The Wall Street Journal, CNN, Forbes, Fox News, and the Star Tribune. Bylines: Newsweek, The Washington Times, MSN.com, The Washington Examiner, The Daily Caller, The Federalist, the Epoch Times.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

VIDEO: Ten Minute Lesson on the Nature of Money

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I was sent this by a gentleman who has a financial magazine read by some of the top people in finance. This is not my field and am uncomfortable even thinking about it in some ways. But I am reliably informed by a few people now, that there is truth in this world view, and profundity. In fact, this is not the usual video about how things work or what to invest in, so much is its an attempt to explain an entire world view about how money is created and destroyed, what wealth is, and so on. I plan to watch it a few more times and hopefully develop an understanding that gives me some predictive ability.

To the extent that I get it now, it doesn’t necessarily change much. It still appears that we are moving from a more or less credit driven free market system into what might be a more controlled feudal system. I dunno. Hopefully this offers insight. Looking forward to the comments on this.

EDITORS NOTE: This Vlad Tepes Blog column by  Eeyore is republished with permission.

U.S. Devotes $195 Mil to ‘Redress the Legacy of Harm’ in Racist Transportation Infrastructure

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In the Biden administration’s latest racial equity project, American taxpayers will spend $195 million to help connect minority communities that are cut off from economic opportunities by racist transportation infrastructure. The costly plan is known as Reconnecting Communities Pilot (RCP) and it is part of the Department of Transportation’s (DOT) “Equity Strategy Goal to reduce inequities” across the nation’s transportation systems and the communities they effect. In its announcement, the DOT writes that “preference will be given to applications from economically disadvantaged communities, especially those with projects that are focused on equity and environmental justice, have strong community engagement and stewardship, and a commitment to shared prosperity and equitable development.” The language sounds like material found in a communist manifesto.

DOT Secretary Pete Buttigieg justifies the investment by explaining that “transportation can connect us to jobs, services, and loved ones, but we‘ve also seen countless cases around the country where a piece of infrastructure cuts off a neighborhood or a community because of how it was built.” RCP is the first-ever initiative funded by the federal government that is completely dedicated to unifying neighborhoods living with the impacts of infrastructure that divides them, Buttigieg adds. It will help reconnect communities that are cut off from economic opportunities by what the administration seems to claim is a racist transportation infrastructure. In fact, the lengthy grant announcement states that the multi-million-dollar community reconnection program “seeks to redress the legacy of harm caused by transportation infrastructure.” The “harm” includes barriers to opportunity, displacement, damage to the environment and public health, limited access and “other hardships,” according to the document.

In pursuit of redressing the legacy of harm, RCP “will support and engage economically disadvantaged communities to increase affordable, accessible, and multimodal access to daily destinations like jobs, healthcare, grocery stores, schools, places of worship, recreation, and park space,” the administration writes in the grant announcement. Thus, the new program will be implemented in line with a multitude of other federal initiatives launched by a 2021 Biden executive order to advance racial equity and support for underserved communities through the federal government. Besides the DOT’s Equity Action Plan, the agency grant document identifies them as federal actions to address environmental justice in minority and low-income populations, affordable housing in the nation’s most desirable neighborhoods and a program to strengthen the economy through the creation of good-paying jobs with the free and fair choice to join a union, strong labor standards, and workforce programs. There are many more that were left out of the RCP document.

In the last year, key federal agencies have implemented racial equity plans as per Biden’s order. The Department of Justice (DOJ) created a special initiative to advance equity for marginalized and underserved communities. The Department of Labor (DOL) dedicated $260 million to promote “equitable access” to government unemployment benefits by addressing disparities in the administration and delivery of money by race ethnicity and language proficiency. The Treasury Department named its first ever racial equity chief, a veteran La Raza official who spent a decade at the nation’s most influential open borders group. The Department of Defense (DOD) is using outrageous anti-bias materials that indoctrinate troops with anti-American and racially inflammatory training on diversity topics. The U. S. Department of Agriculture (USDA) created an equity commission to address longstanding inequities in agriculture. The nation’s medical research agency has a special minority health and health disparities division that recently issued a study declaring COVID-19 exacerbated preexisting resentment against racial/ethnic minorities and marginalized communities. The Transportation Security Administration (TSA) recently hired a Chief Diversity and Inclusion Officer even though most of its employees come from “underrepresented racial and ethnic groups.” Just a few days ago Judicial Watch reported that the administration is spending $6 million to advance racial equity in the government’s food-stamp program that already serves a large minority population.

EDITORS NOTE: This Judicial Watch column is republished with permission. ©All rights reserved.