7:35 AM, Dec 27, 2014 • By IRWIN M. STELZER
An estimated 90 million of us will drive 50 miles or more during this holiday season, and recent years’ gnashings of teeth at the pump are being replaced with smiles. The price of gasoline is down 36 percent since April, to a national average of around $2.40 per gallon, with some cities reporting prices of below $2. That price, which includes paying for the crude oil and refining it into petrol, shipping costs and state and federal taxes, about equals only the tax component extracted from British motorists for every gallon of petrol, as they call it, that they buy. Costs of making the stuff are extra.
The story of oil and gasoline is only one part of the story of the advances -- some would say onward rush -- of the U.S. economy. In 2008 only 75 million Americans, some 15 million less than this year, took to the roads during the holiday season -- many were out of work or too strapped to bear the costs of travel. It might be too soon to revive Franklin Roosevelt’s 1936 campaign song, “Happy Days Are Here Again,” trumpeting the decline in the unemployment rate from 24.9 percent when he took office in 1933 to a mere 16.9 percent, but if things keep going as they are -- more on that next week -- we might be humming it at this time next year.
This is the year in which third quarter growth hit an annual rate of 5 percent, the highest in over ten years, following smart second quarter growth of 4.6 percent. Consumers spent more as did businesses. Orders for durable and nondurable goods, investment in plant and equipment and in intellectual property rose, as did exports. It’s hard to find a bad number in the newest batch of economic data, with the possible exception of housing.
· Auto sales are set to beat last year’s very good figure by about 6 percent, with big, gas-guzzling SUVs leading the way, some luxuriously outfitted and costing more than $100,000 dealers in Chevy Suburbans tell me;
· Share prices hit record levels, with the Dow Jones Industrial Average piercing the 18,000 level for the first time, prompting some New York Stock Exchange traders to show up on the floor wearing hats emblazoned “Dow 18,000”;
· The University of Michigan consumer sentiment index for December is at its highest level since January 2007;
· The unemployment rate fell from 7 percent at the end of last year to 5.8 percent and some 2.5 million new jobs were created;
· In October, manufacturing output passed its pre-recession peak, reached in January 2007, and the sector is now closer to operating at peak capacity than at any time in the past six years despite a global economic environment that is beset by woes from Europe to Russia to Asia to Latin America.
Two other milestones were passed on the road to a fuller recovery. The government’s bailout program, started by George W. Bush and continued by Barack Obama, was beloved of Wall Street and in boardrooms, and loathed on Main Street and around the proverbial “kitchen table” featured on so many political ads. It has now come to an end with the sale of stock from General Motors’ finance arm. That program, formally titled the Troubled Asset Relief Program (TARP), had thrown $426.4 billion of taxpayer money into a battle that saved Citicorp, Bank of America, General Motors, American International Group (AIG) and other companies, and, TARP fans contend, the entire U.S. economy from financial disaster. While, they add, turning a small profit of $15 billion ($25 billion in gains offsetting a $10 billion loss on GM shares) when for the government when it unloaded the shares it acquired during the bailouts -- a profit, that is, if you don’t count the cost of adding to the deficit to get cash to finance the buyouts. TARP left a permanent legacy of banks restored to sufficient health to pay the government some $100 billion in fines for various rule infractions, and of two anti-Wall Street, anti-cronyism populist movements, the Tea Party on the right, and the anti-Hillary Clinton Democratic faction now led by Massachusetts senator Elizabeth Warren, on the left. TARP is no more, these factions remain as thorns in the sides of establishment parties.
11:50 AM, Dec 12, 2014 • By IRWIN M. STELZER
The new dawn didn’t. There was to be no more sturm und drang, no more brinkmanship, no more government shutdowns, no more threats of default on America’s debt. Just routine passage of a $1,100,000,000,000 spending bill to keep the government running until next September when the current fiscal year ends. In the event, it was only hours before midnight on Thursday, when funding of most government activities was scheduled to end, that the House of Representatives, by a vote of 219-to-206 passed the so-called continuing resolution that will keep all of the functions of government, both the necessary and the wasteful, in operation. No, it was not a split in the Republican party that brought us once again to the brink of shutdown, although some Republicans, eager to show their distaste for the president’s unilateral action in freeing millions of illegal immigrants from the threat of deportation did cause, did defect. It was the Democrats who almost succeeded in shutting down the government and President Obama, not House speaker John Boehner, who had to struggle to get this resolution passed. The battle will have important consequences for the shape of American political life during the two years remaining of his term, and perhaps far into the future. Here’s why.
12:00 AM, Dec 6, 2014 • By IRWIN M. STELZER
The European Parliament has called for the dismemberment of Google, the French want “les Gafa,” as they call Google, Apple, Facebook, and Amazon, reined in, EU regulators are under pressure to get tough with the Americans. And the leaders of Silicon Valley’s non-tax-paying, privacy-invading, dominant tech firms, to use EU descriptives, are surprised. They shouldn’t be.
8:42 AM, Dec 5, 2014 • By GEOFFREY NORMAN
The economy added more than 320,000 jobs last month. Against a forecast of 230,000. The unemployment rate holds at 5.8 percent, indicating that many who had previously given up are again seeking employment.
Experts will be going under the hood this morning and fine tuning their reporting. But this is undeniably good news and points, as the Wall Street Journal reports, to the strongest annual job growth in 15 years.
11:43 AM, Dec 4, 2014 • By GEOFFREY NORMAN
Good news: price of gas down. Bad news: price of beef up. Seems that while oil is plentiful, slaughter-weight steers are not.
10:47 AM, Dec 1, 2014 • By GEOFFREY NORMAN
American consumers restrained themselves over the Thanksgiving holiday. With regard to shopping, at any rate. As Hiroko Tabucchi of the New York Times reports:
12:00 AM, Nov 29, 2014 • By IRWIN M. STELZER
“Give me your tired, your poor … your huddled masses … wretched refuse … the homeless,” implores the Lady in New York harbor. Little can she know that 11.4 million of these “tempest-tost” souls are already here, having arrived illegally, most from Mexico and points south. Some 4-5 million of those illegal, or “undocumented” immigrants to use the description preferred by pro-immigration advocates, no longer are threatened with deportation orders.
3:45 PM, Nov 22, 2014 • By IRWIN M. STELZER
Some 140 million bargain-hunting customers will descend on retailers on Thanksgiving Day, so-called Black Friday, and throughout next weekend -- or at least those who haven’t shopped already or by early next week will head for the shops. Not so long ago most stores remained closed on Thanksgiving Day, on the assumption that families preferred to spend the holiday enjoying uninterrupted togetherness, downing some 46 million turkeys and watching football. No longer. Walmart, Macy’s, and many others are opening their doors on the holiday.
12:00 AM, Nov 15, 2014 • By IRWIN M. STELZER
There is more than might have been, but a lot less than first meets the eye. That describes the climate deal struck this week by President Barack Obama and Chinese president Xi Jinping in their private two-day meeting following a gathering of 19 Asian Pacific leaders in Beijing. The very fact of a deal is more than even well-informed observers expected.
2:48 PM, Nov 13, 2014 • By GEOFFREY NORMAN
Recent news on the economy has been generally encouraging so it is possible that this week’s first time claims number could be a one-off.
An idea for the president.7:48 AM, Nov 10, 2014 • By IRWIN M. STELZER
President Obama, an increasingly leaky White House tells us, fears irrelevance. I am still relevant, the president all-but declared at his recent press conference. And to prove it, he told us about his constitutional authority to issue executive orders and to veto bills that he finds in conflict with his progressive agenda. Perhaps.
10:10 AM, Nov 7, 2014 • By GEOFFREY NORMAN
The monthly BLS report on unemployment comes in under expectations which were for some 235,000 news jobs. So the 214,000 is a downside miss. However, the new benchmark for “good, not great” seems to be a monthly increase in of 200,000. And the economy has hit that number for nine consecutive months.
6:00 PM, Nov 3, 2014 • By WILLIAM KRISTOL
Whether or not Jeff Bell comes from behind to win the New Jersey Senate race, he deserves credit for having run a classy, ideas-focused race. That's epitomized by his "closing argument," reproduced below. If a majority of New Jersey voters actually read this email, I do think Bell would win. The media complain a lot about the low quality of campaigns these days—but when an underdog candidate runs a high-quality campaign, they don’t bother covering it. It would be good if some of them acknowledged Bell's attempt to elevate the political discourse.