Tag: pandemic
First-Quarter Productivity Decline Is A Grim Economic Portent

First-Quarter Productivity Decline Is A Grim Economic Portent

The Bureau of Labor Statistics today released its first estimate of productivity in the first quarter. It showed productivity falling at a 0.8 percent annual rate. This is really bad news.

Productivity matters a lot for both inflation and living standards. In the five years from 2019 to 2024, productivity growth averaged 1.9 percent annually. That is up from 1.1 percent annually in the decade before the pandemic.

The faster rate of productivity growth most immediately translates into lower inflation. As a first approximation, inflation will be equal to nominal wage growth minus productivity growth. If nominal wages are growing at a 4.0 percent annual rate, and productivity is rising at a 1.9 percent annual rate, inflation will be roughly 2.1 percent. (We could have some redistribution from profits to wages, reversing the rise in profit shares in the pandemic, but we’ll leave that one for another time.)

To take the other side of the same coin, real wages can sustainably increase at the rate of productivity growth. The 1.9 percent rate of productivity growth meant that real wages could rise at roughly a 1.9 percent annual rate. By contrast, the 1.1 percent rate for the decade before the pandemic could only support a 1.1 percent annual rate of real wage growth. Over the course of a decade that’s the difference between a 20 percent rise in real wages and an 11 percent rise.

For these reasons, the productivity slowdown reported for the first quarter is a big deal. Having said this, it is necessary to throw out two important caveats about the first quarter productivity data.

First these data are subject to revisions. Both the numerator or this equation (output) and the denominator (hours) will be revised in subsequent months. When we have the data in June, after two rounds of revisions, the picture may look very different.

The other important caveat is that productivity data are notoriously erratic. For example, productivity shrank at a 2.4 percent annual rate in the fourth quarter of 2015. It rose at a 1.7 percent annual rate in the first quarter of 2016. Reversals like this are very common. This means that even if the first quarter weakness holds up through revisions to the data, it is entirely possible that we see a sharp reversal in the second quarter or the second half of 2025.

First and foremost, the negative productivity growth reported for the first quarter should be seen a warning. We have pursued a number of policies that are likely to do both near-term and lasting damage to the economy. Tariffs, mass deportations, reckless layoffs in the federal government, and slashing research budgets, are all likely to hurt economic growth. Much of the impact will only be seen over the long term, but some may already be showing up in the data.

For example, if ships from China are not coming due to 145 percent tariffs, we will see fewer workers unloading goods, at the ports, fewer truck drivers transporting goods, and before long, empty shelves at the stores. The firings at the federal level, coupled with layoffs elsewhere due to cutbacks of federal support, could show up in higher unemployment rates.

The fall in productivity reported for the first quarter should be taken as a flashing yellow. Maybe all will be okay, but it’s not a good start.

Dean Baker is an economist, author, and co-founder of the Center for Economic Policy and Research. His writing has appeared in many major publications, including The Atlantic, The Washington Post, and The Financial Times. Please consider subscribing to his Substack Dean Baker.

Reprinted with permission from Substack.

RFK JR. Trump Lutnick

What Happens When The U.S. Government Reports 'Alternative Facts'?

Much has been written about the Trump team's assault on civil society, universities, public health, the judiciary and our global alliances, and rightly so — but there is one danger that deserves more attention because our ability to thwart this attempted revolution, this upending of our constitutional system, depends upon truth itself.

We have seen one institution after another buckle before President Donald Trump's onslaught. If Congress is conquered, and Big Tech won't oppose him, and Big Media is bending the knee, and Big Law is folding, and universities are crumpling, and the judiciary is a question mark, who is left? Only the voters.

But what if the voters don't have a grasp on reality? What if the inflation rate rises to 9%, bird flu is ravaging farms across the Midwest, unemployment is rising, the economy is shrinking, measles is killing hundreds of children, crime is rising — but the government has suppressed or falsified the data that would reveal those conditions? We face the prospect that many government statistics will be manipulated by Trumpists.

The demolition work has already begun. The Labor Department has dismissed a committee of economists, academics and business leaders who advised the Bureau of Labor Statistics. The Commerce Department has disbanded the Federal Economic Statistics Advisory Committee — an arm of the Bureau of Economic Analysis — which seeks, or rather sought, to help the government provide accurate statistics on many aspects of the economy.

The move came on the heels of Commerce Secretary Howard Lutnick telling Fox News that he plans to alter the way GDP is calculated. "You know the Commerce Department runs the statistics of GDP. Governments historically have messed with GDP. They count government spending as part of GDP. So I'm going to separate those two and make it transparent."

Yes, some governments (think China) do sometimes misrepresent economic statistics. But our government has been pretty clean in this regard — until now. Keep in mind also that any first-year economics student could tell you how to break down GDP into government spending, consumption, investment and net exports — all statistics that are, for now, easily accessible thanks to the government.

This is yet another way the Trump administration is undermining America's global standing. As Tara Sinclair, a professor at George Washington University's Center for Economic Research, told NPR, "If the data were manipulated, even in a small way, that will affect the credibility of our entire statistical system. And that's going to have global financial implications, because people around the world rely on the quality of U.S. economic data to make decisions."

Advisory panels do more than offer expertise; they provide insurance against the politicization of government statistics. Without neutral outsiders looking over the shoulders of government decision-makers, it becomes easier to fudge or hide data. That brings us to the Census Bureau, the agency that determines who lives where and how many votes each district is entitled to, among many other things. It just dismissed five outside advisory panels.

Simultaneously, the administration is curtailing public access to climate-change data compiled by the National Oceanographic and Atmospheric Administration. You say the Earth is warming — well, we have data that say the opposite. It's "alternative facts," but this time, it's not just Kellyanne Conway riffing with reporters — it comes bearing a government imprimatur.

It would be easier to count grains of sand on a beach than to keep track of the lies emanating from this administration, but manipulating official government studies and statistics is a step beyond anything we've seen and a profound threat.

Consider the secretary of health and human services, who has spent his entire career denying reality about infectious diseases, vaccines, and other matters. Nominating and confirming (looking at you, Sen. Dr. Bill Cassidy of Louisiana) such a dangerous crank for a key public health post was an antisocial act.

Even if Robert F. Kennedy Jr. never did anything but repeat the falsehoods about vaccines that have marked his career, it was a certainty that people would look to him for guidance and be harmed. Sure enough, last week, in the midst of the measles outbreak in Texas, a number of unvaccinated people who contracted measles were admitted to hospitals with vitamin A toxicity.

Under Kennedy, HHS is taking lying to new extremes. Though multiple studies, including one featuring half a million Danish children, have discredited the notion that there is a link between vaccines and autism, Kennedy has authorized a new study to search for a "link." This is beyond mendacious. The original study suggesting a connection was found to have been a hoax years ago, and again, no reputable research since has found any association between vaccines and autism. Autism diagnoses are rising due to awareness, not vaccines, as any person not suffering from oppositional defiant disorder can figure out.

Kennedy has chosen David Geier to conduct this sham "study." Geier is not a physician (though he was sanctioned by the state of Maryland for practicing medicine without a license), and he's a proponent of the vaccines-cause-autism deceit. But few will remember this when he produces a government-sponsored "study" showing a link between the MMR vaccine and autism.

The Trump administration is doing more than attempting to seize unconstitutional power for an unaccountable executive. It is seeking to destroy truth itself, the last tool of the opposition.

Mona Charen is policy editor of The Bulwark and host of the "Beg to Differ" podcast. Her new book, Hard Right: The GOP's Drift Toward Extremism, is available now.

Reprinted with permission from Creators.


If You Get Ebola, Don't Forget To Thank Donald Trump

If You Get Ebola, Don't Forget To Thank Donald Trump

The last time Americans faced the possible spread of Ebola to U.S. territory, in 2014, Donald Trump irresponsibly stoked public fears and barked at Barack Obama while doing nothing useful to protect us. Now the same deadly virus has showed up in the crowded capital of Uganda — where a nurse has died — and is threatening to spread further, which means it could eventually arrive here.

And this time Trump has done something far worse, mindlessly ripping down the shield that has defended us from Ebola and similar menaces. If and when the hemorrhagic virus arrives here to kill Americans, he won't be able to point an accusing finger at Obama or anyone else.

Last August marked the 10th anniversary of the Ebola outbreak in Liberia that the Obama administration stopped through the work of the U.S. Agency for International Development and the Centers for Disease Control and Prevention, overseen by White House officials, all working in cooperation with other countries and the World Health Organization.

It was a complex undertaking: Led by Ron Klain, who later became Joe Biden's chief of staff, veteran officials mounted what's known as a "whole of government" effort to confine the outbreak in West Africa and bolster the local response with advanced medicine, protective gear, burial teams and experienced clinicians.

The result they achieved was an enormous success that saved many lives and enhanced American prestige abroad. Hundreds of idiotic carping tweets from Trump, then just a celebrity conspiracy monger, were an ignoble footnote.

Flash forward to our current dark moment, when the Trump administration is abruptly eviscerating all kinds of vital government functions — including our once-unparalleled capacity to suppress a hazard like Ebola before it seriously imperiled our citizens.

Almost as soon as he returned to the Oval Office, the president misused his power to cripple all the agencies whose personnel and expertise are most needed at this moment to guard against the return of Ebola. On his orders, the United States withdrew from the WHO, while his minions took down USAID websites and shut down most CDC functions.

Mark Leon Goldberg, a journalist who superbly covers international organizations and America's "soft power" diplomacy, explained how the system is supposed to work in his Global Dispatches column on Substack:

"Under normal circumstances, there would be no need to panic. Since the 2014 West Africa Ebola outbreak, local health officials in Africa and the international community have become skilled at containing outbreaks before they spread out of control. There have been at least eight separate outbreaks in the region, but all have been contained. None spread internationally, least of all to the United States.

"At the center of these efforts to stop the international spread of Ebola are the World Health Organization, the U.S. Centers for Disease Control and Prevention, and the United States Agency for International Development. These agencies work with local authorities and provide platforms for international cooperation that help develop and deploy vaccines, conduct disease surveillance, and work directly with local health officials to provide capacity where it may be lacking."

He quotes Stephanie Psaki, a former National Security Council official, outlining the "playbook" that those agencies followed to stem countless disease outbreaks — implemented at high speed with international partners, emergency funding and trained health professionals in place.

What's suddenly different, says Goldberg, is that "there's no one left to execute that playbook. Trump fired most of them. ... Simply put, the methods and strategy that have successfully kept Americans safe from eight Ebola outbreaks over the last decade are no longer operational."

The same numbskull who once mouthed off about Ebola has left us more vulnerable to it than we've ever been before. Trump's own former surgeon general, Dr. Jerome Adams, recently warned against the vindictive and stupid assault on the nation's public health infrastructure by his old boss.

"Regardless of how you feel about 'public health,' or 'Fauci,' it's a real bad time to have blocked public communications from CDC, and work with WHO," Adams scolded on social media. "Republicans must understand (that) they're gonna own any and all preventable outbreaks / harm moving forward."

He means the Republicans who are letting Trump run wild. But no worries! When the coffins are lined up, I'm sure they will all send thoughts and prayers.

Reprinted with permission from Alternet.

Why Did Trump Silence Public Health Officials -- Again?

Why Did Trump Silence Public Health Officials -- Again?

Within days of Donald Trump entering the Oval Office, he decreed by executive order that the United States will withdraw from the World Health Organization. He ordered the National Institutes of Health, the Centers for Disease Control and Prevention, the Food and Drug Administration and the Department of Health and Human Services to stop communicating with the public and other scientific organizations. And he withdrew the security protecting Dr. Anthony Fauci, the retired federal infectious disease expert.

Why would Trump issue these reckless orders, which appear ill-timed and foolish as the H5N1 virus — bird flu — begins to spread across the nation? Having already killed millions of chickens, this disease appears now to have killed at least one American male — and could soon mutate into a form transmitted from human to human.

To anyone who remembers how Trump mishandled the COVID-19 pandemic during his final year in office, his actions during the first week of his second term are deeply ominous. The U.S. death toll was the highest in the world, with over a million Americans struck down by the virus, despite the fact that we had access to vaccines before many other countries.

Despite Trump's laudable effort to encourage production of vaccines, he also became the principal obstacle to an effective response. Politics dictated Trump's actions from the very beginning, when he downplayed the pandemic threat and pretended that coronavirus would disappear before Easter. He discouraged testing, again because he wanted to minimize the threat. Listening to extremist advisers, he promoted quack cures, scoffed at effective health measures like masking, and undermined trust in public health authorities. His statements and actions resulted in countless unnecessary fatalities — ironically concentrated among his own Republican supporters.

Now Trump appears to be deflecting blame for his own failures onto international and federal agencies — and onto Fauci, whose undeserved status as a whipping boy for the far right has brought death threats against him and even his family.

It's not that WHO and the U.S. health agencies didn't make mistakes in coping with COVID-19 — a new form of illness that kept mutating and defying measures to bring it under control. Even the wise and experienced Fauci didn't get everything right. But the errors and missteps by Trump and his administration were far more consequential — and worse, were plainly motivated by political self-interest.

While the actual impact of Trump's executive orders has yet to be determined, their effects could severely undermine our defenses against the next pandemic, which seems likely to arrive sooner than expected. As a member of WHO, the United States benefits from the WHO global surveillance network that monitors perilous diseases such as influenza and Ebola — providing timely data, genetic material and other crucial information to our scientists. Removing U.S. funding and support will seriously undermine that system and endanger the entire world, including us.

Silencing or chilling communications from federal health agencies — and halting their exchanges with other scientists both here and abroad — poses a different risk. Prohibited from publishing scientific reports, issuing health advisories or updating their websites, the CDC and NIH won't be able to send out public alerts and recommended procedures, with potentially grave effects on our collective response to a pandemic.

These dictates from the new Trump regime are a spooky echo of the old Trump regime's bad behavior.

Recall that in late February 2020, a top CDC official publicly warned of an imminent pandemic and urged Americans to prepare for the shutdown of schools and workplaces. The president instantly threatened to fire her and forbade the CDC from delivering briefings on measures to combat the virus.

Instead, Trump took over the briefings and constantly misinformed the public. On masking, for instance, he said, "You don't have to do it. I'm choosing not to do it." Trump not only contracted the virus and became gravely ill — surviving only thanks to special care at Walter Reed Army Hospital — but made many others in his orbit sick as well. He nearly killed his former friend Chris Christie by exposing him to the virus (although typically Trump claims it was Christie who infected him).

We may soon relive that nightmare. Sadly, this president appears to have learned nothing from experience, except how to deflect responsibility. That won't protect any of us — not even Trump.

Joe Conason is founder and editor-in-chief of The National Memo. He is also editor-at-large of Type Investigations, a nonprofit investigative reporting organization formerly known as The Investigative Fund. His latest book is The Longest Con: How Grifters, Swindlers and Frauds Hijacked American Conservatism.

Reprinted with permission from Creators.



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