You should understand the Energy Department – even if Trump doesn’t

❝ When you hear the name “Rick Perry,” you might recall that time during the 2012 Republican presidential primary race where he forgot the name of a government agency he wanted to eliminate. After saying he wanted to ax the Department of Commerce and the Department of Education, he blanked on the third. Later in the debate, he said that his forgotten target for destruction was the Department of Energy.

A responsible leader doesn’t forget the name of a government agency that he wants to shut down. A responsible leader studies the department in detail, learning all of the things that it does, and thinks about how things would change if the department were abolished. And so for Perry, that “oops” moment was enough to persuade voters that he lacked the firm grasp of the facts needed in a presidential candidate. He soon abandoned the race…

❝ In reality, the department was created in an effort to increase government efficiency by combining of a bunch of existing agencies. One of these was the Energy Research and Development Administration, the successor to the Atomic Energy Commission, which itself grew out of the Manhattan Project. That agency managed the U.S.’s nuclear weapons programs. This is still one of the Energy Department’s jobs — it includes the National Nuclear Security Administration, which oversees the safety of the U.S. nuclear stockpile.

Let that sink in a moment…

The Energy Department’s roots in nuclear energy also show that it wasn’t simply a response to high oil prices. Government support for nuclear power boomed in the 1950s, when oil was cheap. The goal wasn’t to avert a fossil-fuel crunch, but to give humanity even cheaper sources of power.

❝ That’s still the department’s goal. As Bloomberg New Energy Finance reports, solar energy is now cheaper than coal power in many places, even without government subsidies, and is getting cheaper still. As a partial result of this technological improvement, coal is on the wane, while solar is booming. Scaling plays a huge part in this process.

Solar’s rise hasn’t come because of a fundamental technological leap, but because of learning curves. As production rises, prices tend to fall…

That means the Energy Department’s subsidy programs, which encouraged solar growth back before the economics made sense, probably had a hand in jump-starting the era of abundant energy that we now see stretching before us.

❝ More to the point, we should just stop rewarding intellectuals and politicians for casually calling for the abolition of government agencies in the absence of understanding what they actually do.

No doubt, my call is likely to fall on deaf ears, at least while the Trump administration is in power: Perry has…been nominated to head the Energy Department.

Noah Smith is one of the best and brightest of today’s young American economists. He is a Bloomberg View columnist. He was an assistant professor of finance at Stony Brook University, and he blogs at Noahpinion. He’s definitely worth following on Twitter @Noahpinion.

Our Immigrants, Our Strength


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Life jackets along the NYC waterfront — a reminder

❝ World leaders are gathering in New York this week for the United Nations General Assembly, and at the top of their agenda sits a refugee crisis that has reached a level of urgency not seen since World War II. The United Nations Summit for Refugees and Migrants and President Obama’s Leaders’ Summit on Refugees represent a watershed moment that is putting a global spotlight on the need for an effective response to a growing humanitarian crisis…

❝ As the mayors of three great global cities — New York, Paris and London — we urge the world leaders assembling at the United Nations to take decisive action to provide relief and safe haven to refugees fleeing conflict and migrants fleeing economic hardship, and to support those who are already doing this work.

We will do our part, too. Our cities pledge to continue to stand for inclusivity, and that is why our cities support services and programs that help all residents, including our diverse immigrant communities, feel welcome, so that every resident feels part of our great cities…

❝ Investing in the integration of refugees and immigrants is not only the right thing to do, it is also the smart thing to do. Refugees and other foreign-born residents bring needed skills and enhance the vitality and growth of local economies, and their presence has long benefited our three cities.

❝ Our cities are also on the front lines of helping those fleeing violence or persecution connect to critical, often lifesaving, services. Paris is one of the first major municipalities to open a refugee center in the heart of the city. Beginning in October, the center will provide services and basic necessities, as well as administrative support, to 400 refugees. New York has placed city representatives in immigration court to connect the thousands of unaccompanied children from Central America seeking asylum to crucial health, education and other social services. Last year London boroughs provided support to more than 1,000 unaccompanied, asylum-seeking children, and the city is now developing new ways of working with communities to offer support to resettled refugees.

❝ We know policies that embrace diversity and promote inclusion are successful. We call on world leaders to adopt a similar welcoming and collaborative spirit on behalf of the refugees all over the world during the summit meeting this week. Our cities stand united in the call for inclusivity. It is part of who we are as citizens of diverse and thriving cities.

RTFA for the details. This was published by the mayors of New York City, Paris and London. Not only cities for the successful – but, for the people of those cities trying to build anew.

Jobs — Blowing in the wind

Made-in-the-USA wind power will help keep our economy competitive and our air clean for generations – that’s one key takeaway from the U.S. Wind Industry Annual Report, Year Ending 2015, published by the American Wind Energy Association…

…U.S. wind power now supports a record 88,000 well-paying American jobs. This reflects a 20% growth rate in jobs supported by wind power in 2015 alone.

Last year, you helped us achieve a long-term extension of the primary federal policy incentive for wind power. In doing so, you helped to spur this job growth, and make the future brighter for these employees, and others who aspire to join them. If we succeed in meeting our goal – taking our country to 20% wind power by the year 2030 – the workforce is estimated to grow to 380,000 employees.

How many wind power jobs are in your state? Take a look at the map, and share it with your elected officials.


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Texas leads the nation with over 24,000 wind energy employees.

Wind project construction propelled Oklahoma to second place with more than 7,000 jobs.

Rounding out the top five are Iowa and Colorado with over 6,000 jobs, and after moving up 11 spots, Kansas ranks fifth with over 5,000 wind workers.

Maine gained the most in the state wind employment rankings, rising 16 spots.

No need for wind jokes about politicians and other fossil fuel industry pimps. Fact remains, folks fighting for renewable energy sources are winning and we need to keep up the pressure. The creeps whose profits and lifestyle are centuries behind their sell by-date won’t walk away just because they’re losing. They know American politicians can usually be counted on to go to the highest bidder. We have votes to offer. They have dollar$ to spend on election and re-election campaigns.

Same as it ever was – true. But, just as true, we are winning. Our voices and votes count.

Thanks, Mary Kate Francis

How wealthy are the rest of us?

We seem to really enjoy contemplating the money and lifestyles of the top 0.01 percent. The wealthiest Americans garner immense mind-share in the imaginations of the rest of the populace. We incessantly track the incomes of hedge-fund managers and other finance stars, the heirs to the Wal-Mart fortune and other $100 billion families. Don’t forget the Bloomberg Billionaires Index and the Forbes 400 and the wealthiest New Yorkers.

We are in short fascinated with other people’s wealth.

What about the rest of the income strata? As it turns out, there is a fascinating story there as well. It may not be as glitzy and luxe as the Billionaires Index, but it is a tale of gradual improvement. So says a recent data analysis on the global middle class by the Pew Research Center.

The good news is that during the first decade of the 21st century, about 700 million people were lifted out of poverty. That is a 14 percent reduction in poverty. The bad news is that moving into, and staying within, the global middle class is a significant challenge.

The study found that 71 percent of the global population is either poor (15 percent) or low-income (56 percent). The middle class is only 13 percent of the total population. To put some hard numbers on those percentages, with a world population of 7.2 billion humans, about 936 million are middle-class. A little more than a billion (1.08) are impoverished, and more than half the world’s population, a giant 4.03 billion people, are low-income.

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The Pew report contains some astonishing data points: 84 percent of the world’s population, including those defined as middle-class, live on less than $20 a day. Surviving on the maximum in the U.S. or Europe would be difficult for an individual — about $7,300 a year…

Think of it another way. More than fourth-fifths of world’s population live on less than $20 a day. In other words, how well this vast swath of humanity is doing will have important implications for industry, from health care and finance to agriculture and energy.

Income growth in these groups in both the developing and developed world will alter the economic and political landscape.

Not to be too optimistic, but the economic state of world is getting better. As more people move into the global middle class, they are able to buy more consumer goods, save and invest. That creates a long-term self-interest in political stability and, one can hope, democratic institutions.

Barry Ritholtz is justified in his positive outlook for the global population – even if the “we” in the industrial western civilization aren’t doing as well. The United States, Canada and Western Europe – with conservative governments very often – have a declining middle class. So, we feel the squeeze of Republican-style economics.

It’s your choice, folks. In my view as someone who’s a citizen of the planet Earth, I’m pleased the struggles of so many people around this globe are moving forward towards better opportunities for themselves, their children. The ennui of ignorant North Americans, of Europeans who have stepped into the bipolar trap of two-party politics continues to drag down what always has been the most dynamic and creative segment of our economy.

You can keep on with the obvious foolishness of believing you alone can make it – while the fat cats at the top stack the deck – or you can fight for independent thought and action and try for change that starts with education, healthcare, social security – and, did I say, education.

Key findings about the changing U.S. religious landscape

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Pew Research Center’s new Religious Landscape Study, the first since our 2007 study, draws on a massive sample size of more than 35,000 Americans to offer a detailed look at the current religious composition of U.S. adults. The size of the sample enables us to explore relatively small religious groups (including specific Christian denominations) as well as state- and metropolitan area-level data.

In addition to the full report, the findings of the study can be explored at a new interactive website. Here are a few of the key findings:

Christians are declining, both as a share of the U.S. population and in total number. In 2007, 78.4% of U.S. adults identified with Christian groups, such as Protestants, Catholics, Mormons and others; seven years later, that percentage has fallen to 70.6%. Accounting for overall population growth in that period, that means there are roughly 173 million Christian adults in the U.S. today, down from about 178 million in 2007.

Within Christianity, the biggest declines have been in the mainline Protestant tradition and among Catholics

The decline of Christians in the U.S. has corresponded with the continued rise in the share of Americans with no religious affiliation…People who self-identify as atheists or agnostics (about 7% of all U.S. adults), as well as those who say their religion is “nothing in particular,” now account for a combined 22.8% of U.S. adults – up from 16.1% in 2007…

There are clear differences between certain demographic groups when it comes to religious affiliation

The share of Americans who identify with non-Christian faiths, such as Islam and Hinduism, has grown modestly

You’ll find the whole report online over here. An interesting read especially if you find philosophy, personal and sociological, of interest. As I do.

Yes, we’re still about a half-century or more behind the rest of the industrial West when it comes to re-examining the beliefs we inherit from our less-educated forebears. Not much we can do about it except continue to encourage education. Folks can come to progressive conclusions on their own; but, it does help to have an extended opportunity to see what the whole world is learning and talking about. Ain’t many folks getting that from cable TV or this year’s hot social media.

Overdue and halfway useful — F.D.A. will finally phase out some antibiotics in farmed animals

The Food and Drug Administration said Wednesday that it was beginning to phase out the use of some critical antibiotics in animals raised for meat, a major policy shift that could have far-reaching implications for industrial farming and human health.

The change, which will take effect over the next three years, is the first serious attempt by the federal government to curb the broad use of antibiotics in farm animals in decades. Pressure for action has mounted as the effectiveness of drugs important for human health has declined, and deaths from bugs resistant to antibiotics have soared. Food producers said they will abide by the new rules, but some public health advocates voiced concerns that loopholes could render the new policy toothless…

The agency has changed the rules so that food animal producers would no longer be able to use antibiotics to make animals grow faster. It will accomplish that by asking manufacturers of the drugs to change the labels in a way that would make it illegal for farmers to use the medicines for growth promotion.

The changes, which were originally proposed in 2012, are voluntary for drug companies. But F.D.A. officials said they believed the companies would comply, based on discussions during the public comment period. The two drug makers that represent a majority of such drug products have already stated their intent to participate…

Additionally, the agency is requiring that licensed veterinarians supervise the use of antibiotics, effectively requiring farmers and ranchers to obtain prescriptions in order to be able to use the drugs for their animals.

Consumer health advocates say it is an open question whether the new rules will change how much antibiotics are consumed by animals. They say that a loophole will allow animal producers to keep using the same low doses of antibiotics, by arguing that they were needed to keep animals from getting sick, and thereby avoiding the new ban on use for growth promotion…

A more meaningful move, Dr. Keeve Nachman said, would be to ban the use of antibiotics for the prevention of disease, a step the F.D.A. so far has not taken. That would limit antibiotic uses to treatment of sickness that was diagnosed by a veterinarian, a much narrower category, he said.

RTFA for a few more details. This should get rolling in the beginning of 2014 and we’ll see which Pharmas obey which regulations. Same goes for the agribusiness giants who consider consumers a fraction of a step more important than the commodity animals they slaughter.

The cracks are still widening, but some light is also getting in

If you’ve been following the media industry over the past year, you probably don’t need anyone to tell you the waves of disruption continue to increase in both height and frequency — so the news that widespread cutbacks have caused dissatisfied readers to flee won’t come as much of a surprise. But while those waves have swamped some traditional players, other parts of the industry have been able to ride the tide, and non-traditional sources continue to play a growing role in how people get their news — although whether that is good or bad is still open for debate.

All of that and more is contained in the latest State of the Media report from the Pew Research Center’s Project for Excellence in Journalism…There’s a lot to take in, but here are what I believe to be some of the key takeaways:

The Bad News:

Cutbacks continue, and consumers are leaving: Close to one-third of U.S. adults say they have stopped using a news outlet because of dissatisfaction over the content — in other words, because they weren’t getting the news they wanted, or the news they expected to get. Survey respondents mentioned both fewer stories in general and less complete reporting, and while it’s impossible to know whether this phenomenon is related to the repeated rounds of cutbacks and job losses, it seems likely…

The Good News:

Demand for news is growing, not shrinking: Although it may be coming at the expense of some traditional players, there is clearly a large and growing appetite for news, since the top news sites saw traffic increase by 7 percent in 2012, according to Pew. And the impact of social media seems to be clearly positive, in the sense that those who have heard about news from friends and family through such channels show a stronger interest in finding out more…

As with any overview of the media business, there will be those who see this picture as a glass half-empty, and those who see it as a glass half-full — and perhaps a growing number who have completely lost interest in the glass because they are already getting their water elsewhere…upheaval is the order of the day in the media business and will likely be so for some time…

Even now there are new entities being born, and new models being applied — like the Forbes “BrandVoice” model, or Sullivan’s direct-to-readers model — that could either be the savior of the industry or a dangerous distraction. If you like bumpy rides with an uncertain ending, the media industry is definitely the place for you.

RTFA. Lots of meat and potatoes to munch on – both form and content. Producers who come from traditional print journalism are doing better than I thought they might. It may be out of desperation as anything else – like sudden insight – but, the truth will inform you even when it doesn’t set you free.

Here’s a predictable achievement of the Republican anti-Obama campaign – American prejudice against Blacks increased

Racial attitudes have not improved in the four years since the United States elected its first black president, an Associated Press poll finds, as a slight majority of Americans now express prejudice toward blacks whether they recognize those feelings or not…

Racial prejudice has increased slightly since 2008 whether those feelings were measured using questions that explicitly asked respondents about racist attitudes, or through an experimental test that measured implicit views toward race without asking questions about that topic directly.

In all, 51 percent of Americans now express explicit anti-black attitudes, compared with 48 percent in a similar 2008 survey. When measured by an implicit racial attitudes test, the number of Americans with anti-black sentiments jumped to 56 percent, up from 49 percent during the last presidential election. In both tests, the share of Americans expressing pro-black attitudes fell…

Most Americans expressed anti-Hispanic sentiments, too. In an AP survey done in 2011, 52 percent of non-Hispanic whites expressed anti-Hispanic attitudes. That figure rose to 57 percent in the implicit test. The survey on Hispanics had no past data for comparison…

Experts on race said they were not surprised by the findings

Neither am I.

Obama has tread cautiously on the subject of race, but many African-Americans have talked openly about perceived antagonism toward them since Obama took office. As evidence, they point to events involving police brutality or cite bumper stickers, cartoons and protest posters that mock the president as a lion or a monkey, or lynch him in effigy…

The poll finds that racial prejudice is not limited to one group of partisans. Although Republicans were more likely than Democrats to express racial prejudice in the questions measuring explicit racism (79 percent among Republicans compared with 32 percent among Democrats), the implicit test found little difference between the two parties. That test showed a majority of both Democrats and Republicans held anti-black feelings (55 percent of Democrats and 64 percent of Republicans), as did about half of political independents (49 percent).

As predictable a result of bigotry and hate as has been the anti-Muslim, anti-immigrant, xenophobia engendered by Republican politics since 9/11.

Put the blame for corruption on victims. Just as the range of ethnicities and religions among the fallen at 9/11 extended well beyond white bread-America, the range of victims of the Bush Era oversight failure – our Great Recession – falls disproportionately on the least equipped economic segment of our population. Non-whites, Hispanic folks, Black people get it in the neck the most from disappeared jobs and opportunity.

Keep on rocking in the Free World!

Stocks rally on decision to rebuild, repair, expand infrastructure to aid commerce – oh wait, that’s China not the United States!


The redesigned Hangzhou South railway station

China approved plans to build 1,254 miles of roads, spurring the biggest stock- market rally in almost eight months on signs the government is stepping up stimulus efforts to revive economic growth.

The government also backed nine sewage-treatment plants, five port and warehouse projects, and two waterway upgrades, according to statements on the website of the National Development and Reform Commission yesterday…

The Shanghai Composite Index closed 3.7 percent higher, led by construction stocks, on speculation infrastructure spending will help bolster growth that’s cooled to the slowest pace in three years. The announcements came a day after approvals for subway projects in 18 cities, an earlier rise in the railway- building budget and increases in land supplies in cities including Guangzhou, Hangzhou, Beijing and Shanghai.

They are clearly stepping up the infrastructure-investment push to help boost confidence and revive growth,” said Zhang Zhiwei, Hong Kong-based chief China economist at Nomura Holdings Inc. Premier Wen Jiabao’s policy stance is shifting “to a more proactive and significant easing…”

“China’s central government finally took real actions to arrest the worsening slowdown,” Bank of America Corp. economist Lu Ting said in a note. “Adding home supply and improving urban infrastructure are the two best ways to contain home prices, speed up urbanization and increase social welfare…”

The approvals on Sept. 5 for a total of 25 new subway and inter-city rail projects are worth more than $126 billion, or 1.7 percent of 2011 gross domestic product, according to HSBC. The spending will run from the second half of the year to 2018, it said…

The NDRC backing may accelerate metro-rail developments, most of which were already in local governments’ plans, Citigroup analysts Jenny Zhen and Paul Gong said in a note to clients yesterday.

“This sentiment is positive for the whole railway- construction and equipment sector,” they said…

If you’re interested in the global economy, one of the funniest things you can do is watch Asian Squawk Box on CNBC-World with Bernie Lo. Bernie’s a dyed-in-the-wool Republican and a Baptist to boot. He tries very hard to ask leading question of Asian old hands – to paint China as a failing economy envious of American accomplishments.

I watched him the other night as he tried to press one of the lifers for a typical Wall Street 2-3 month outlook on structural economic changes in China. He got the usual sigh, followed by – you have to learn that China’s economic planners, the government as a whole ignores what the stock market is doing in its various up-and-down joyride. They look to what will achieve the greatest improvement over a 2 to 5 year period. They want to ensure the fullest employment and growth in the nation’s economy – not just a bump that satisfies daytraders and short-term profiteers.

Meanwhile, we sit here in the GOUSA and get to watch alternating panic and euphoria from Biz TV talking heads and politicians who are most expert at blaming someone else – anyone will do – instead of Congressional corporate pimps who are most accomplished at sitting on their hands when they’re not busy picking our pockets.