Bernie loves Donald! Americans love old cars!

Bernie loves Donald!

Someone once said that Republicans are like Democrats, only slightly less so. That description seems especially apt for Donald Trump, whose economic views would make Bernie Sanders proud —recalling the old Persuaders song, “It’s a Thin Line Between Love and Hate.” So what separates Bernie Sanders from Donald Trump? Mainly age: Sanders is 84, while Trump is a 80. Both favor using government power to seize private wealth. Bernie has proposed that the federal government take 50% of the stock of AI companies. Outrageous? His RINO ally DJ has floated a similar idea, promising to make Americans “rich as hell” by requiring AI companies to sell equity stakes to the federal government.

Sanders harks back on Obama’s “you didn’t produce that” and AOC’s contention that the wealth of some comes by making others worse off. Sanders justifies his expropriation by saying that AI was produced through the “collective knowledge of humanity”. Hey “Artificial intelligence was not created out of thin air. The data and language used by generative A.I. tools didn’t just pop into Sam Altman’s head or Elon Musk’s imagination. A.I. is built on our collective intelligence: our books, songs, artwork, journalism, computer code, scientific research, videos, conversations, images and ideas spanning generations.” By that logic, I should get a cut out of the profits of every producer of goods and services no matter how big or how small – including some of Bernie’s book royalties.

Now we will see if the republicans continue to genuflect to Trump. Ted Cruz says “I don’t think the federal government should be in the business of being an equity holder in private companies.” All well and good, but where was Cruz when Trump started this road to socialism by demanded a piece of other firms? Cruz was silent while the Trump government has taken equity stakes in private companies. In August 2025 it acquired 10 percent of Intel. As of mid-2026 the government had spent $30 billion in sixteen companies, mostly semiconductors and rare earths.

I guess it is a matter of semantics. Bernie being the good socialist that he is wants to expropriate the 50 percent stake in AI while Trump is purchasing his government share with the government’s money. But any way you slice it, both are big government socialists at heart.

We love old cars

You know you are old when your car has a cassette player. Actually my CLK 350 does have a cassette player but the F250 and the GLS 450 have CD players. Do new cars have CD players? My CLK is a 2007. The F250 is a 2017 while the GLS is a 2018. I am in equilibrium and have no desire for a new vehicle. As a matter of fact, I would not trade any of my vehicles for a new one. The CLK is my favorite Mercedes convertible and I actually pat it when I put it up for the night. When my GLS was in the shop and they give me a loaner, I like the technology in the new ones but they just feel cheap. My GLS has higher end seats and fixtures than the new models. It feels more solid too. I would rather have mine than a new one. The F250 has 165,000 miles on it and is the best truck I have ever owned. It has towed a 41 foot toyhauler all over the east coast and to motorcycle rallies way up north and out west. We camp with it when we visit out of state friends and the fifth wheel makes a great hunting lodge. It is also my farm truck and I will drive it – and the others – until the wheels fall off.

I am not by myself. Americans are keeping their vehicles longer. We are not quite the Cubans but the average American car is 12.6 years old. Insurance costs – I changed companies because my old one tried to lowball me on the repairs when a deer attacked my GLS 450 – and especially the ridiculous high prices of new cars are enough to keep the old clunkers going. I am old enough to have paid $1,650 for a new Toyota Corolla in 1968. Even on a graduate student’s stipend I could afford it. Now a Toyota Corolla starts at $30,000 and goes to over $40,000. 

Those factors also mean that the number of new cars purchased yearly in America have fallen by one million units. So more and more Americans are opting to keep their cars longer. You would think that the auto dealers who get half of their revenues from their service shops would benefit. But customers have increased doing it yourself and have also gone to independent repair shops resulting in dealer service visits falling by 12 percent last year. 

I haven’t done the math but it is likely that the American automobile manufacturers would rather make SUVs and pickups that are more expensive with higher markups than small sedans increasing overall profitability. No American manufactured cars are under $30,000. Since that is the case, then your government should remove all tariffs on vehicles imported into the country with a list price under $30,000 and leave that market to the Japanese, Koreans and Chinese. I am tempted to say that the Asians build small cars because they are small people – but I won’t.

Mike Pence versus the Cult of Trump

Mike Pence

I have a genuine respect for Mike Pence. While many of those around him abandoned their conservative principles in favor of Trump’s brand of populism, Pence has largely held his ground. His essay “A Republican Time for Choosing,” published in the Wall Street Journal, clearly articulates those principles.

Much of what Pence writes echoes concerns I have raised since Trump first took office — including my recurring unease about the stranglehold our two-party system has on American politics. I won’t rehash those arguments here. But one passage in Pence’s essay deserves particular attention: his invocation of Calvin Coolidge’s 1926 speech in Philadelphia, delivered on the 150th anniversary of the signing of the Declaration of Independence.

“If all men are created equal, that is final. If they are endowed with inalienable rights, that is final. If governments derive their just power from the consent of the governed, that is final. No advance, no progress can be made beyond these propositions. If anyone wishes to deny their truth and their soundness, the only direction in which he can proceed historically is not forward, but backward toward the time when there was no equality, no rights of the individual, no rule of the people. Those who wish to proceed in that direction cannot lay claim to progress. They are reactionary.”

Against that backdrop, consider how Trump has chosen to mark the 250th anniversary of the nation’s founding. A $250 bill bearing his likeness? A proposed “settlement” funneling $1.776 billion in taxpayer money to political allies — since blocked by a federal judge? The plastering of his name across Washington landmarks, including the Kennedy Center, where another federal court has ordered its removal? And then there is the spectacle of the National Mall celebration, where Trump announced himself as the headline act after a string of performers — Martina McBride, Bret Michaels, Young MC, Morris Day and The Time, and The Commodores — declined to participate. Trump dismissed them as “overpriced singers, who nobody wants to hear, whose music is boring,” and declared on social media that he was bringing “the man who some say is the Greatest President in History (THE GOAT!), DONALD J. TRUMP” to take the place of these highly paid, Third Rate ‘Artists.’” 

But of course everyone wants to hear a two hour speech by the president!

The Cult of Trump

As Pence observes, Trump’s populism has gradually transformed his movement from a conservative coalition into something more closely resembling a personality cult. The phenomenon is not unique to Trump — it follows the familiar logic of any cult organized around a single charismatic figure. Those who once identified as principled conservatives have, in many cases, jettisoned those principles entirely, endorsing behavior from Trump that they would roundly condemn in any liberal politician.

The conflicts of interest alone should give pause. Trump purchased $5 million in Dell shares, after which Dell was awarded a $9 billion government contract. To MAGA loyalists, this registers as unremarkable. George Will — hardly a Trump sympathizer — put it bluntly: the GOP has “become a cult” whose beliefs are whatever its leader declares, even when those declarations contradict longstanding conservative orthodoxy. As Will noted, Trump’s Republicans have found themselves in agreement with progressive Democrats that the government should be directing the economy — rejecting free trade for protectionism and free markets for state intervention. That his supporters can absorb these contradictions and still find their footing is, at minimum, a feat of considerable cognitive flexibility.

Again TDS reigns on both sides.

What we have, in practice, is whim-driven governance — mercurial, unpredictable, and largely untethered from coherent principle. The tariff policy offers the clearest illustration. The rationale shifts constantly; the targets seem almost random. Allies and adversaries are treated interchangeably. Trade surpluses and deficits seem equally irrelevant. The policy reaches its logical nadir when the president raises tariffs on Switzerland, reportedly because he took offense at the Swiss president’s tone during a phone call.

Recall that Trump told Fox’s Bret Baier, before taking office, that he would be too busy governing to pursue retribution against his enemies. I wrote at the time that this was a lie — a claim that cost me my column at the Knoxville Focus, a local “conservative” weekly. The subsequent record has vindicated the assessment. The Department of Justice has functioned, in no small part, as a Department of Retribution, pursuing more than 48 individuals Trump regards as adversaries — among them E. Jean Carroll, who accused him of sexual assault in the 1990s. The case of John Bolton is particularly instructive: forced into a “settlement” that required him to plead to a felony charge for conduct that, in prior cases involving more serious offenses, had drawn only misdemeanor treatment. That prosecutors continue to push for jail time suggests motivations that are, at best, difficult to distinguish from pure vindictiveness. Bolton, for his part, should have had the judgment to wait until Trump left office before publishing his memoir.

I have long argued that Trump Derangement Syndrome cuts in both directions. His opponents are consumed by a reflexive hostility that distorts their judgment; his supporters are consumed by a reflexive loyalty that does the same. Both are, in their way, cults — one organized around loathing, the other around devotion. Neither is a reliable guide to the truth.

The Democrats’ Recruitment Class: When the Fringe Becomes the Face

There is a rule in politics that used to be bipartisan common sense: the candidates you recruit say everything about what your party stands for. By that standard, the modern democratic party has a serious problem — and it is one entirely of its own making. Across the country, democratic primaries are producing candidates whose views would have been disqualifying in any serious political organization a decade ago. The party that once prided itself on pragmatic governance and broad-tent coalition-building has instead become a proving ground for ideological maximalism — rewarding candidates who compete to see how far left they can sprint before falling off the edge.

The Progressive Surge

The progressive wing of the democratic party has convinced itself that the path to power runs through ideological purity. The result is a candidate pipeline that prioritizes litmus tests over electability and grievance over governance. Calls to abolish prisons, seize private industries, and dismantle America’s international alliances are no longer fringe positions whispered at activist meetings — they are campaign platforms, endorsed and celebrated.

What’s striking is not just the radicalism of some of these positions — it’s the institutional cowardice with which the democratic establishment has responded to them. Party leaders who once would have drawn clear lines have instead hedged, equivocated, or quietly looked the other way. The result is a party that cannot define what it stands for, because it is too afraid of the activists who fund and organize it to say no to anyone.

Character No Longer Counts

Beyond ideology, there is the matter of basic character standards — once considered a floor, not a ceiling, for public office. Democrats spent years insisting that personal conduct mattered, that who a candidate was as a person reflected on the party and ultimately on governance itself. That standard has now been selectively abandoned whenever inconvenient. Serious questions about a candidate’s character are brushed aside as distractions the moment ideological allies decide an election is too important to lose.

This is not a matter of partisan scoring. It is a coherent observation: a party that refuses to enforce its own stated values is a party that has no values — only interests. Voters notice.

The Antisemitism Problem

Perhaps most glaring example has been the democratic Party’s halting, inconsistent response to antisemitism within its own ranks. Jewish voters — a constituency that has been reliably democratic for generations — are watching candidates who traffic in anti-Jewish rhetoric receive enthusiastic support from prominent party figures. The double standard is glaring – rhetoric that would end a republican’s career overnight is tolerated, rationalized, or ignored entirely when it comes from the left.

Republicans have a genuine opportunity here — not to exploit fear, but to offer something the democratic party currently cannot: a clear, unambiguous commitment that antisemitism has no home in American politics, period, regardless of which side of the aisle it comes from. Jewish Americans deserve a political home where their safety and dignity are not conditional on their ideological alignment.

What This Means for 2026 and Beyond

Democratic recruitment is not merely an internal party management problem. It is a window into the soul of an institution in ideological free fall. A party that cannot say no to its most extreme voices, that cannot enforce basic standards of conduct, and that cannot protect its own most loyal constituencies from harassment and hate is not a party fit to govern.

Republicans should resist the temptation to simply mock and move on. The better choice is to contrast — clearly, repeatedly, and specifically — what principled governance looks like against what the democrats are currently offering. Voters in competitive districts are not ideologues. They want competence, stability, and leaders who can pass a basic integrity test.

The democrats are making the argument for republicans. The task is simply not to get in their way.

MAGA too!

And yes, I am not giving the republicans a pass. Just go back and read previous postings. Recall, I got fired from the local “conservative” weekly for not being 100 percent MAGA and having the audacity to be critical of our (RINO) president. The republicans have their MAGA fringe led by the occupant in the White House. There are Andrew Clyde, Randy Fine, Andy Ogles, Tim Burchett and some of the 40 member Freedom Caucus. But the MAGA fringe is a personality driven cult. It does not have legs and will end when Trump leaves office. But no single personality drives the fringe on the left. It is a collection of souls that seems to grow daily. From the vacuousness of AOC to the toxicity of Graham Platner, the progressive left appears to have more staying power than the MAGA right. Consider that the far left progressive caucus in the House sports 97 members while its “center-left” New Democrat Coalition has 110 members (30 of whom also belong to the progressive caucus. So 177 of the 212 democrat members of the House are either center-left or fringe left. That, my friends, is not a personality driven cult like the MAGA-folk and why it is here to stay for a while.

Costco emulates China!

Is China cheating in world markets?

The OECD recently reported that 60 percent of China’s market-share gains across 15 industrial sectors were driven by government subsidies with Chinese firms receiving three to eight times more state support than their domestic competitors. The implications are threefold. First, those subsidies allow Chinese companies to undercut foreign rivals on price, sometimes selling below cost. Second, this practice is a key reason the Chinese economy is under serious strain. One has to wonder how long Beijing is willing to bleed its own finances to capture global market share. Third, Western consumers benefit at Chinese citizens’ expense. We buy goods below market price while ordinary Chinese people foot the bill.

Source: OECD Finds 60% of Chinese Gains in Market Share Driven by Subsidies

It may surprise you but I support tariffs on subsidized imports set equal to the value of the subsidy, not as protectionism, but as a corrective measure to level the playing field. My preference remains zero tariffs and zero subsidies across the board. The United States is hardly blameless here. Washington heavily subsidizes agriculture and provides substantial support to aerospace, energy, and manufacturing, totaling roughly $150 billion annually. A more productive approach would be negotiating mutual agreements to eliminate export subsidies altogether.

Do you Costco?

Which brings me to Costco. Have you noticed the gas lines? I pay $65 a year for membership for the privilege of making Costco my primary gas station. It is closer than Sam’s, is conveniently located and is 30 to 50 cents per gallon cheaper than other gas stations. That kind of pricing is classic loss-leader strategy. Costco acknowledges that members who buy gas are more likely to shop inside, generating revenue that offsets the below-market fuel prices. In other words, Costco is doing exactly what critics accuse the Chinese of doing, using subsidized pricing in one category to gain broader market advantage. Should Costco be penalized for it? If not, the logic of sanctioning China for doing the same thing subsidies deserves a harder look.

On a more personal note, I have never loved shopping at Costco. The parking lot is perpetually packed with the carts piled high as though a storm is coming. The Costco app is useless as are the employees. No one who works there knows where anything is. Also, Costco must pay Apple News, because every day there are articles about shopping at Costco. I don’t think a single item in any of the articles is healthy and not a single one I would buy.

Honestly, I hate Costco. I hate the crowds. I hate the lousy service. Despite the convenience, I am going to go to let my membership expire and buy my gas at Sam’s. I prefer Sam’s anyway. The checkout is faster. The stuff I buy is cheaper at Sam’s. And the clerks don’t have nose rings and assorted facial piercings – except for an occasional nose stud (what’s with these nose piercings anyway?). Also I only buy two things at Costco, their coastal cheddar cheese and their Kirkland brand salsa. Well, the salsa is now gone – slated for deletion (because of course, I buy it). I am therefore not renewing and will buy the bulk cheese at Sam’s, while not as flavorful, it’ll do.

So has Costco adopted the Chinese economic playbook of using subsidized pricing in fuel to erode competition from independent gas stations? It comes as no surprise that it has opened stores in Shanghai and Shenzhen. I wonder if gas is a lost leader there as well? Perhaps the saving grace for small businesses here may be the very things that frustrate Costco shoppers –  the membership fee and the interminable lines act as natural barriers that keep bulk retail from completely displacing neighborhood stores. At least for now.

Hegseth at Normandy

Pete (Fox News) Hegseth gave a speech at the 82^nd anniversary of D-Day. As I have often mentioned, my other half’s father was a Bedford Boy and was in the first waves at Omaha Beach. So I was especially interested in Hegseth’s remarks – given that he is my least favorite of Trump’s cabinet. Well his speech was covered very differently by the media. While it was reported in glowing patriotic terms by the rightwing press, such was not the case with the European media. In fact, it stirred up a hornet’s nest on the continent a fact ignored by Trump’s news outlets here.

Hegseth took the occasion to criticize European nations over illegal migration for allowing what he described as an “invasion” on their shores during the speech. The Europeans had a proverbial cow and did not report any other part of his speech. Hegseth said “Sadly, today, different European beaches are stormed by different dangerous ideologies. Beaches in Spain, in Italy, in Greece and Bulgaria. Boats and men arrive. When will European capitals do something about that invasion?” Hegseth said that in the years since D-Day some European capitals have grown too “comfortable” with their hard-fought freedoms, forgetting that “freedom is not free”. “The men who fought and died here restored freedom to Europe. That freedom must be maintained by this generation of leaders and war fighters or what they fought for was merely temporary.”

The European press was not pleased. The Guardian reported that Hegseth was accused by European historians of “grotesque stupidity” and desecrating the memory of the soldiers who stormed the beaches of Normandy after he sought to link immigration to the D-day anniversary, saying Europe was facing a different “invasion” of its shores.” https://www.theguardian.com/world/2026/jun/07/pete-hegseth-d-day-speech-immigration-grotesque-stupidity

The British historian Simon Schama described the remarks as a “special kind of loathsomeness: a blend of historical deafness, grotesque stupidity and comically ludicrous self-importance”. “As if the little people’s rage against immigration somehow is superior to the war against the 3rd Reich and entitles this comic book nobody to lecture the actual heroes.” [Don’t you love the command of the English language by the English?}

Here are more comments from the Guardian. Israeli lawyer Daniel Seidemann said “This is an obscene desecration of the memories of those who

stormed the beaches of Normandy, and especially of those who fell.” Anders Åslund, a Swedish economist contrasted the comments with Hegseth’s later remarks on the US standing alongside its allies. “So much nonsense,” he wrote on social media. “‘We stand by our allies!’ No you don’t. You just attacked them. Immigration policies are internal matters.” Åslund said Hegseth’s comments were particularly “clueless” given his recent decision to skip a key NATO meeting and Donald Trump’s vows to cut the number of troops in Europe. “Doesn’t Hegseth know that the most unreliable ‘ally’ by far is the US?” 

This reporting is in stark contrast to the coverage of the event by the Trump mouthpiece Red State where never a word of criticism of anything Trump or Trump related is printed. This publication is as biased as anything on the left. You can read it for yourself. The is no mention of Hegseth’s remarks on immigration. “Hegseth Remembers Those Who Fought During 82nd D-Day Commemoration at Normandy”

https://redstate.com/nick-arama/2026/06/06/hegseth-marks-d-day-anniversary-n2203110

Also, it is apparent that Hegseth decided to go off script and join others in the administration (JD Vance) at lecturing the Europeans on their own soil because the official remarks from the Department of Defense made no mention of illegal immigration. So I guess Red State only looked at the official release from the Department of Defense and did not actually cover the event itself. You may read the speech at https://www.war.gov/News/Speeches/Speech/Article/4208765/remarks-by-secretary-of-defense-pete-hegseth-at-the-81st-d-day-landings-anniver/

Here are the last two paragraphs.

“Our world is a better place when Europe and America are strong, free, and independent. France understands this well and so do the men buried here, and so do the men sitting before me. Our nations together have endured a bond intertwined by history and we share this hallowed ground underneath our feet dedicated and consecrated by the blood of our heroes.

Our moment today is an echo. It’s an echo of theirs and may we live worthy of them. It is truly one of the honors of a lifetime to commemorate the sacrifices of D-Day and celebrate the freedoms of our two nations. God bless you all and may God bless our warriors. Thank you.”

It’s about time! Gerrymander scorecard.

It’s About Time!

How do you feel about changing the clocks — springing forward and falling back? I personally hate it. It takes both me and my dog a while to adjust. Since I get up around 5:30 a.m. seven days a week, my German Shorthaired Pointer, Lili, needs time to reset her internal clock as well. Depending on which way we’ve sprung or fallen, she’ll want to be walked and fed at either 4:30 a.m. or 6:30 a.m.

I’ve reported before that the Georgia legislature voted to move to Atlantic (Bermuda) time year-round. Now, the House Energy and Commerce Committee has voted 48–1 to make Daylight Saving Time permanent.

The president was ecstatic, tweeting: “Big Vote today (48–1!) in the Energy and Commerce Committee on a Bill including The Sunshine Protection Act, which will make Daylight Saving Time Permanent! This is so important — hundreds of millions of dollars are spent every year by people, cities, and states being forced to change their clocks. Many of these clocks are located in towers, and the cost of renting or using heavy equipment to do this twice a year is prohibitive! It’s time that people can stop worrying about the clock, not to mention all the work and money spent on this ridiculous, twice-yearly production. It will also be a very nice win for the Republican Party. We are going with the far more popular alternative — saving daylight — which gives you a longer, brighter day. And who can be against that? This is an easy one! The House and Senate should push hard for more daylight at the end of the day. Very popular and, most importantly, no more changing of the clocks — a big inconvenience and, for our government, a very costly event!”

I think he left out the confusion it causes for hens trying to lay their eggs on schedule — and for dairy cows wondering when it’s time to be milked.

My clocks reset automatically, so I’ve had my own run-in with time changes. I remember waking up one morning to go deer hunting and completely forgetting about the time change. I got up, walked the dog, and headed out to my tree stand — only to be puzzled by how long it was taking for sunrise. When I checked my watch (which I only wear when hunting), it read 4:30 a.m. instead of 5:30. I’m fairly certain that was the longest hour of my life. The deer seemed confused too — nothing was stirring that morning.

Who Gained, Who Lost in the Latest Gerrymandering Wars?

I’ve written before about “safe” seats versus “competitive” House seats. Most seats in the House are safe, and the purpose of gerrymandering is to make even more of them that way. California sought more safe Democratic seats. Texas aimed for more safe Republican seats — and specifically tried to eliminate the seats held by Jasmine Crockett and Al Green. Tennessee worked to dismantle the safe Democratic seat in Memphis, much as it previously did with the one in Nashville, converting both into safe Republican seats.

So when all is said and done, which party came out ahead? Karl Rove has weighed in on the question. (See: Gerrymandering Isn’t Enough for the GOP — WSJ)

Rove finds there are 184 safe Democratic seats, 188 safe Republican seats, and only 63 competitive ones — 18 of which are considered toss-ups. To maintain control of the House, Republicans must win 30 of those 63 competitive seats. Democrats need 34 to regain control and install Hakeem Jeffries as Speaker.

In a typical off-year election, the president’s party loses around 30 seats. But this is far from a typical election. When Obama’s approval rating dropped to 45 percent, Democrats lost 63 seats. With Trump’s approval now below 40 percent, it would be remarkable if Republicans managed to hold the House. However, gerrymandering makes it nearly impossible for them to lose 63 or more seats.

Brace yourself: Hakeem Jeffries as Speaker, Democrats in control of all House committees, and impeachment — part three.

Trump’s latest tariffs

In his continuing effort to find a way to make his illegal tariffs legal, the president – or more likely his anti-trade trade representative Jamieson Greer – has come up with another effort that is almost comical. It is use of Section 301 of the Trade Act of 1974. Greer is accusing 60 of our trading partners of failing to enforce laws around “forced labor,” using that as a justification to impose tariffs of 10 percent to 12.5 percent. The tariffs affect 99% of imports to the United States. This is another attempt to reimpose Trump’s universal tariffs. The man just doesn’t give up. This attempt is so childish that I was going to write a rejoinder. But my friend Professor Don Boudreaux of George Mason University beat me to it. If you are familiar with Don’s blog, Café Hayek you know that the vast majority of his posts are regarding tariffs. Because of that I have written less and less about them and just refer you to Café Hayek to see the continuing debunking of the president’s obsession.

Here is an article in the Wall Street Journal

https://www.wsj.com/economy/trade/u-s-proposes-at-least-10-tariffs-on-trading-partners-after-probe-into-forced-labor-511511f5

Here Don is responding to a similar piece in the Washington Post. 

Editor:

The Trump administration’s latest excuse – of which you’re wisely skeptical – for imposing, this time under Section 301, broad punitive taxes (a.k.a. tariffs) on Americans’ purchases of imports is that it wishes to combat forced labor (“Trump tries a new trick to raise tariffs,”June 4).

Every civilized person sympathizes with prohibitions on the sale and purchase of goods produced by slaves. Yet every such person als0 understands that protectionists have incentives to abuse this sympathy by exaggerating the extent to which the stream of commerce contains slave-produced goods. In this light, here are some relevant facts (gathered with the help of Claude).

In China, which is the trading partner accused as being most reliant on forced labor, the upper estimate of the number of forced laborers is 3.17 million. Now looking at other data from 2024 – and making assumptions as generous as possible to the administration’s case – we have these additional facts:

– Total number of manufacturing workers in China: 120 million

– Annual U.S. imports of manufactured goods from China (including estimates of transshipments): $542 billion

Even if (contrary to fact) all forced-labor workers in China work in manufacturing, that means that 2.6 percent of China’s manufacturing workers are forced laborers. Assuming (also almost certainly contrary to fact) that the productivity of these workers is as high as that of China’s non-forced-labor manufacturing workers ($39,000 per worker), the value of U.S. manufactured-goods imports from China that is produced by forced labor is likely around $14.1B. With total U.S. imports of manufactured goods being $2.71 trillion, the maximum share of U.S. manufactured-goods imports that is produced by Chinese forced labor is 0.5 percent.

As a portion of total annual U.S. production of manufacturing output – $7.1 trillion – U.S. imports of forced-labor manufactured goods from China are a paltry 0.2 percent.

These numbers strongly suggest that the effects on America’s economy of forced labor in China are too minuscule to meet Section 301’s requirement that the challenged actions be shown to burden or restrict U.S. commerce. You are indeed wise to doubt the sincerity of the administration’s latest excuse for obstructing Americans’ freedom to trade, as a far worse source of such burdens and restrictions is the administration itself.

Sincerely,

Donald J. Boudreaux

Professor of Economics

and

Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the

Mercatus Center

George Mason University

Fairfax, VA 22030

Random Thoughts #79

Nukes for Taiwan?

I’ve grown weary of China’s endless posturing toward Taiwan. I’ve argued before that this is largely a rope-a-dope — China would be strategically foolish to attempt an invasion. Their real objective, I suspect, is the reunification with Manchuria. But here’s a thought: why not end the Taiwan drama once and for all by simply giving Taiwan a nuclear weapon? A credible nuclear deterrent would silence Beijing’s bluster overnight. Short of that, the U.S. could station nuclear weapons on Taiwanese soil under American control — a bold but defensible move that sends an unmistakable signal.

Loyalty Over Competence — Once Again

Trump appointed his stooge Bill Pulte as acting Director of National Intelligence, replacing Tulsi Gabbard. Pulte will add that title to his other two. Currently he is director of the Federal Housing Finance Agency and also chairman of Fannie Mae and Freddie Mac. Pulte’s sole qualification as DNI director appears to be unwavering loyalty to Trump. Even reliably Republican voices pushed back: deposed Texas senator John Cornyn flatly stated he saw “no evidence of any qualification for the job,” and Senate Majority Leader John Thune warned, “We don’t need a weaponized DNI.” Others worry Pulte will be used to target political enemies — and not without reason. Don’t you think Pulte has enough on his plate already? But Pulte is merely the latest in a parade of Trump loyalists shoehorned into roles they aren’t qualified for. When you demand fealty above all else, the talent pool shrinks fast — and you end up just stacking new titles onto the same old cronies.

Because it’s an acting appointment, Pulte skips Senate confirmation — where he would almost certainly fail. His selection is also a pointed insult to Treasury Secretary Bessent, who reportedly once threatened to punch Pulte “in the f—ing face.” But there’s a deeper signal here: Trump may simply view the Office of the Director of National Intelligence as useless, another layer of government he has little use for. 

Trump’s Endorsement Streak Hits a Speed Bump

Trump’s otherwise reliable endorsement record took a hit when his pick for Iowa governor — Rep. Randy Feenstra — was defeated in the primary by businessman and farmer Zach Lahn. Lahn ran with the backing of Charlie Kirk’s Turning Point Action and had known Kirk since he was seventeen. Apparently, in Iowa friendship with Kirk trumps Trump.

The journal Nature Takes Aim at Academic Fraud

The journal Nature is finally doing something meaningful about the academic fraud that has long plagued its pages. It will now accept “registered reports” — proposals in which researchers submit their hypothesis, methods, and planned analyses before running any experiments. If accepted, Nature commits to publishing the paper regardless of whether the findings reach statistical significance, provided the protocol was followed and the results interpreted reasonably. Pre-registered protocols are stored in a public repository, preventing researchers from quietly bending or cherry-picking results after the fact. Crucially, this also opens the door to publishing negative or inconclusive findings — results that are systematically absent from the scientific literature today.

I’ve had papers rejected precisely because the results were “negative.” Think of the climate research that never saw the light of day for the same reason. Kudos to Nature for this overdue reform.

Heat Deaths, Old Age, and the WHO’s silly recommendation

A recent Wall Street Journal piece by Bjørn Lomborg — “Global Warming or Just Getting Old?” — takes aim at a WHO committee’s push to designate climate change a global health emergency. Their evidence: heat-related deaths in Europe have climbed to 63,000 per year, up 82% since 1990. Lomborg points out the obvious — Europe’s population has aged significantly over that period, and aging alone accounts for virtually all of that increase.

Two things Lomborg didn’t mention are worth adding. First, a rise in European deaths hardly constitutes a “global” emergency. Second — and most glaringly — only about 20 percent of European homes and buildings have air conditioning. The most direct remedy sits right there but recommending it is apparently off the table because of those pesky greenhouse emissions. I guess the WHO feels it is better to have old folk dying of heat stroke – right?

Americans Are Leaving — Would You?

Americans are expatriating at record rates — nearly 200,000 left last year alone. Is it a Trump-driven flight, à la Ellen DeGeneres? For some, perhaps. But most expats cite the cost of living. Retirees are stretching their pensions further abroad. Remote workers have discovered, as one old girlfriend of mine put it, “I can write code anywhere” — she chose Turks and Caicos for the diving and sailing. Hard to argue with that.

Germany baffles me, though — more Americans relocated there last year than Germans came here. Why trade sunshine for a contracting economy and a cold winter? Why move to a collapsing country that is cold? Portugal, Spain, the Netherlands and the Czech Republic have seen the numbers of Americans doubling over the past 10 years and growing by 36 percent since COVID. The dollar may be falling making living abroad more expensive, still a middle income American salary makes you rich in most other parts of the world. So the question is that if you expatriated, where would you go? I am partial to Grand Cayman but ultimately I would have to leave having claustrophobia living on an island. Maybe Mexico? What about you?

When Is Transitory Transitory?

Remember when Janet Yellen and Jerome Powell declared that inflation was “transitory”? They were ultimately proven wrong. Their critics went ballistic, accusing them of lying to protect the Biden administration. Powell was branded a political hack—just as many had long viewed Yellen in her role as Treasury Secretary. But here’s the thing: they weren’t actually wrong at the time. They were relying on a specific measure of inflation that did, in fact, suggest the price surge was temporary. That measure—the Fed’s preferred gauge—was the Personal Consumption Expenditures (PCE) price index, not the better-known Consumer Price Index (CPI).

The PCE is similar to the CPI but differs in a few important ways. First, the PCE captures certain indirect purchases excluded from the CPI, such as medical care paid for by insurance. It also covers rural and urban consumers, nonprofits, and items purchased on behalf of consumers—like employer-provided fringe benefits. Second, and more critically, the PCE’s formula accounts for the fact that consumers adapt to rising prices by substituting lower-cost goods or services for more expensive ones. The PCE captures this substitution effect on an ongoing basis, while the CPI only updates its basket of goods and services every two years. The PCE is therefore more comprehensive than the CPI. But it excludes food and energy prices, which tend to be volatile due to temporary factors such as weather or geopolitical disruptions (think the Strait of Hormuz). Under this framework, if prices rose because of COVID-19—and were expected to fall once the pandemic subsided—policymakers would reasonably classify that inflation as “transitory.” And so they did.

There are other inflation measures worth knowing. The Producer Price Index (PPI) and the GDP deflator are two examples. The Dallas Fed computes something called a “trimmed mean PCE,” which strips out the top 31 percent of the fastest-growing price categories and the bottom 24 percent of the slowest-growing ones. There is also the Median PCE, which can be thought of as a more aggressive version of the trimmed mean—it symmetrically removes the top and bottom 50 percent of categories (sorted by spending-weighted growth rates), leaving only the category sitting precisely in the middle. Each measure has its proponents and detractors. Research suggests, for instance, that the Dallas Fed trimmed-mean measure was downwardly biased when price changes became more positively skewed during the inflation surge of 2021.

Why does any of this matter? Because monetary policy operates with a significant lag. My advisor Karl Brunner drilled this point into us, drawing on Milton Friedman’s landmark study A Monetary History of the United States and subsequent research. Friedman wrote: “There is much evidence that monetary changes have their effect only after a considerable lag and over a long period and that the lag is rather variable.” At the November 2022 Federal Open Market Committee (FOMC) meeting, Fed Chair Jerome Powell invoked this same concept of “long and variable lags.” The implication is straightforward: when the Fed acts—say, by adjusting the federal funds rate through open market operations—it takes considerable time before those actions ripple through to the broader economy. Friedman found that, averaged across the 18 business cycles studied, “peaks in the rate of change in the stock of money tend to precede peaks in general business by about 16 months and troughs in the rate of change in the stock of money to precede troughs in general business by about 12 months.”

That was then—what about now? Asset prices, such as stock prices and government bond yields, typically respond to changes in monetary policy within hours or even minutes. But those rapid asset-market reactions are far ahead of what happens to real goods and services prices and actual economic activity. Federal Reserve Governor Christopher Waller has noted that, in more recent cycles, lags tend to run nine to twelve months—shorter than in Friedman’s era, but still meaningful. Meanwhile, the president of the Kansas City Fed has warned that it may be a mistake to view the current rise in oil prices as “transitory,” even though Powell has suggested it might be. On the other side of that debate, Fed Governor Michelle Bowman has argued that reacting to temporarily elevated energy-price inflation would impose unnecessary restraint on the economy and labor market: “I am optimistic that, once the conflict is resolved, supply disruptions will ease, leaving a temporary imprint in [PCE] inflation and minimal impacts on domestic economic activity.” And yet the Cleveland Fed’s Beth Hammack, who sits on the Open Market Committee, has cautioned that waiting for definitive proof that inflation has become entrenched could force the Fed into larger, more disruptive rate adjustments down the road. Translation: if inflation stays above the 2 percent target, rate hikes will follow.

So it is noteworthy that in the Fed’s Open Market Committee there is significant disagreement over whether spikes in prices are transitory or not. Also should the Fed take action now because of those spikes that will have impacts not felt in real economic activity for a considerable while. Consider, it the spike is transitory and the Fed takes immediate action to raise rates, then the impact in the future will be less economic growth than otherwise.

To recap: different inflation measures produce different results. The Fed favors measures that filter out temporary price volatility because reacting to short-lived fluctuations—given the long lags involved—tends to produce suboptimal outcomes. I used to describe monetary policy to my students as turning around an aircraft carrier. Well, the U.S. economy is a $30 trillion aircraft carrier. If the price increases are concentrated in volatile categories likely to reverse on their own, the Fed will generally view them as transitory. That reasoning is sound—until it isn’t.

Enter Kevin Warsh, the new Fed chair, who wants to revisit the PCE as the primary inflation benchmark. Consider the divergence: the PCE’s “core” measure (excluding food and energy) ran at 3.3 percent over the past year, while the Dallas Fed’s trimmed mean came in at just 2.3 percent. If the Fed were to formally adopt the trimmed mean as its standard, it could declare victory and cut the federal funds rate—something that would surely delight President Trump. At his confirmation hearing, Warsh said: “What I’m most interested in is what’s the underlying inflation rate, not what’s the one-time change in prices because of a change in geopolitics or a change in beef.” That framing should also encompass Trump’s tariffs and the wave of geopolitical disruptions currently buffeting the global economy. If these shocks are truly one-offs, the trimmed mean gives the Fed less reason to tighten. If they are masking deeper demand pressures, these alternative gauges offer false comfort—and would expose the Fed to withering criticism if inflation resurges.

My concern is this: although Warsh has said all the right things about Fed models, the Fed’s historical overreach into fiscal policy, and the dangers of discretionary excess, his push to change the inflation benchmark looks uncomfortably like a search for whatever measure produces the lowest number. To be fair, Fed policy decisions are genuinely difficult—especially when long and variable lags mean that today’s correct call can easily become tomorrow’s mistake.

Here is a research paper that might be of interest.

The Long and Variable Lags of Monetary Policy: Evidence from Disaggregated Price Indices

By S. Borağan Aruoba and Thomas Drechsel

https://www.nber.org/papers/w32623

The Democrats Sell Their Soul (If They Ever Had One)

What does it mean to be “hoisted on one’s own petard”? The Democrats are so desperate to reclaim power that they will embrace some truly strange, bizarre and odious candidates for public office. The poster child is Maine’s Graham Platner, but he is hardly alone — there is also Texas’ Talarico, Michigan’s Abdul El-Sayed, and New York City’s Darializa Avila Chevalier, who has the backing of Zohran Mamdani as she seeks to oust Adriano Espaillat, the chair of the Congressional Hispanic Caucus representing New York’s 13th Congressional District. Never mind that Chevalier has called Joe Biden a “rapist” and a “war criminal,” declared the U.S. a “f—ing disgrace” on social media, posted “f— Kamala Harris,” and attacked even leftists like Bernie Sanders and Alexandria Ocasio-Cortez. She wants to close all prisons, legalize all drugs, end U.S. military support for Israel, and — like a committed communist — seize the means of production. Mamdani likes her, apparently eager to attack the democrat establishment just as much as the country’s foundations. We shall see whether voters in New York continue to reward that kind of thinking.

Platner, who I find genuinely repellent, has been embraced by Bernie Sanders, Elizabeth Warren (“he’s my man”), and the progressive wing of the party. Beyond his public trashing of a war hero, Platner has a well-documented appetite for crude content that makes light of sexual assault and other sensitive topics, and he has struggled to explain away a Nazi-themed tattoo on his chest. Most recently, it came to light that his own wife alerted his campaign early on about sexually explicit texts he had sent to six women — messages she discovered on his phone. He also maintains an account on a private messaging app called Kik, which has a reputation for facilitating sexual hook-ups for pedophiles. None of this has moved Sanders and the left who continue to support him on the grounds that Trump’s economy is the bigger issue. It is a remarkable position to take.

You would think a Nazi concentration camp tattoo would be disqualifying. And it would be, if Platner were a republican. Yet some polls show him running nine points ahead of Susan Collins — one of the Senate’s most respected members, who has never missed a roll call vote during her entire tenure. Platner recently tweeted that “Senator Collins is bought and paid for by Benjamin Netanyahu and votes accordingly,” a statement that sits rather uncomfortably alongside that tattoo. It also ignores the fact that Collins voted for the War Powers resolution to stop Trump’s Iran war. If Maine somehow elects this nutcase Platner then they truly deserve to be called “Mainiacs.” Also the tattoo is fitting since the Nazis were socialists too. 

Planter went to Washington to meet with democrat senators and emerged with their endorsement. Brushing off criticisms of his conduct New York’s Kirsten Gillibrand said “I am very confident we will win Maine.” Sanders said “He is going to stand up to the oligarchies.” I bet Sanders doesn’t mean George Soros, Tom Steyer and Michael Bloomberg. Sanders continues to beclown himself. I am tempted to call him a fool. I should also call Warren a fool as well for criticizing Pete Hegseth (maybe my least favorite cabinet member) for his Christian tattoos while giving Platner a pass on his Nazi tattoo. 

Perhaps that towering intellect – someone name Sonny Hostin on something called the View – said it best about Platner: “So he’s a liar, a racist, an antisemite. He’s a homophobe. So he has all the things and character does matter. But we have someone that has almost unbridled power in the White House at this point. There are no checks and balances and the only way that we can maybe bring a bit of our democracy back is by having a Congress that functions and that has these checks and balances. And I do think one of the only ways is to win that seat in Maine.” I guess she hasn’t seen Collins’ voting record. What an idiot.

Recall also the vocal antisemite who ran for a congressional seat in Texas and advocated putting all American Zionists in jail. Jewish democrat representatives in Congress said they would petition to block her from being seated if she won. Senator Jacky Rosen of Nevada, along with Representatives Josh Gottheimer of New Jersey and Jared Moskowitz of Florida, forcefully condemned her rhetoric, with Gottheimer and Moskowitz vowing to force expulsion votes “every single day” if she were elected. So why haven’t Rosen, Chuck Schumer, and their colleagues in the Senate taken the same stand against Platner? The silence is telling.

This strikes me as a genuine opportunity for Republicans to make inroads with Jewish voters. Senate Majority Leader John Thune should put out a statement from his caucus committing to challenge Platner’s seating should he somehow win. I have several Jewish friends who are moving away from the democrats driven in no small part by the antisemitism they see flourishing in democrat ranks. One told me recently that he feels uncomfortable wearing his Star of David here in Knoxville — genuinely worried that someone might follow him from synagogue and vandalize his car or worse. I told him that this feeling echoed what black southerners lived through in the 1950s and ’60s. When I was admitted to the University of Georgia, an administrator warned me not to walk the campus perimeter with my books for fear of being shot. I took that advice. And yet, even then, certain fraternities openly threatened students like me just for walking on campus.

I am glad those days are behind us. When my youngest granddaughter attended Georgia — graduating in 2023 — she said she never experienced a single instance of racism in her four years in Athens. Hopefully, before long, we will be able to say the same for Jewish Americans as well.