Where are we going from here?Posted by Joseph Semuta on 4/23/2020
I'm not gonna lie. I have been outright depressed the last few weeks. For a day or two I'd be happy, maybe even super happy. Then BAM! I am dragging my body around. Make no mistake about this kids, getting back to worthwhile endeavors will do wonders and the fact that I am setting up classes in the district's cyber school for us to collaborate on and move forward is a breath of fresh air...even through my mask.
Despite my joy for this little win, the reality of our economic climate is dire. The distribution of scarces goods and resources (economics) is changing. Social distancing is here to stay until there is a medicine to mitigate the disease's effects and that is likely at least a year away. Even if every governor in the country were to lift their state's restricitons, one would stil wonder how much people will return to normal. At this point we have to ask ourselves what businesses are likely to be purged, what business will survive and how. What replaces those lost? How do these changes impact workers? Are we going to need more, or less of certain occupations?
Whoever has these answers and the courage to carry them out stands to become very wealthy. Our social paradigm has shifted. Who is going to capitalize?
I guess my question is why not you?
The rest of this semster we are going to focus on markets (interaction of supply and demand) and entrepreneurship. Maybe the next Jeff Bezos comes from HAHS...why not?
An FYI....there are no requirements until May 4th.
Repeat...we are not moving forward until May 4th so until then think about future of goods and services in this social distanced world.
The last two weeks...Posted by Joseph Semuta on 4/16/2020
The volume of information I have consumed over the past two weeks is indiciative of the law of diminishing returns. I mean, my brain is fried. Walk away...walk away. It's so hard though because reality is absurd. They'll be more worthwhile posts coming soon. This is one of those "you have to crawl before you walk" type posts.
Sign in and comment. Let me know what kind of posts and information you would like to talk about.
RedistributionPosted by Joseph Semuta on 4/2/2020
The massive unemployment numbers released today clearly illustrates the need for government intervention in the economy moving forward. We already know Congress is aware, but the argument will evolve as we move forward as to exactly what the government is supposed to do. There are hardcore libertarians out there who are not enthused about government bailing business out for any reason. Technically, it's part of the risk of opening up a business they believe. Remember when we did our reading objectives into fiscal policy, government can try to stimulate either demand side (Keynesian) or supply side (Trickle down). The mechanism they choose should be reflective of how they are trying to stimulate the economy.
Is it fair to really call what the government is doing a "stimulus". I mean, we don't actually want to increase spending becasue the likely means reducing social distancing. No, we need government to pay the bills for those who have been forced out of work...that includes small business...for the duration of this mess. That's really the only way we can make it.
Thoughts? Am I over-reacting?
This post is about more though. During normal times, America has been know to shame people for receiving welfare. However, the federal government is massive and everybody on every level of society receives free or reduced prices for goods or services...the definition of welfare. Check out the two articles in the Social Redistribution readings section to get a feel how the government supports different levels of society in different ways and how we tend to shame the poor for receiving aid, but not others.
My favorite elements of Everyone is Still on Welfare have to do with how we provide money back to upper classes via taxes which hides the fact that they received a reduced burden. We just saw it with the Trump tax cuts in 2017, yet most do not care that the government decided to redistrbute cash at much greater levels to the upper class than to lower classes. It just doesn't cause the uproar that social welfare does; Perhaps it is because the wealthy control the media and do not want to push the story. Who knows why, but it's a very real phenomenon.
Another element of the article that I appreciated is the idea that we shame people for receiving food stamps, but the other beneficiaries of that policy choice make out like bandits because of the program. Selling more food means more people working all throughout the supply chain for the store. It means more profits for the store. It means a greater demand for jobs. Yet, we frame it as theft be a class of people with no real benefit, and that is wrong.
I am not saying that you should support food assistance programs, I am saying that if you believe that these welfare programs are bad then you should also judge all the other welfare recipients that same way.
The Washington Post article How the Poor Pay More describes the difficulties of urban poverty and the difficulties and importance of choices. We know that choices have consequences. Sometimes however, the choices are out of your hands and that is when the difficulty arises. You know, the structural deficiences of some places. Parts of this article remind me of when I lived outside of Pittsburrgh and had to take my clothes to a laundry mat. Make no mistake about it, laundry mats are otherwordly at times. There are characters upon characters and drama and insanity!!!! You get waaaaaaaay more done at home when you can wash and dry your laundry in your basement. Imagine trying to study in a laundrymat. It can be done, but it is clearly harder to get stuff done in a quality fashion inside a laundry mat, not to mention the limited worhtwhile activites one can complete in a laundrymat.
What are your thoughts on these articles? They both ususally generate wonderful discussion. I would love for that to happen here.
Not one comment yet???Posted by Joseph Semuta on 4/2/2020
Not one comment on anything? Would you guys be interested in setting up a zoom as a class? I am going to podcast lecture burst on the first demand section soon. Let me know how that works out.
How is everybody doing?Posted by Joseph Semuta on 3/30/2020 3:00:00 AM
I can't tell you how much I miss school, but I want this blog to be about you. How are you doing? Have any positives emerged from our time at home? Are you taking advantage of Ebsco host and gettign some reading in? I'd love to hear from you. Post in the comments so I can get a feel for the quality of this as a communication tool.
Thanks and looking forward to hearing from you.
Evidence of how important some view the economyPosted by Joseph Semuta on 3/30/2020 2:00:00 AM
If you ever doubted the incredible power that economic forces can wield, consider the absurdity of a politician in a functioning democracy suggesting that the health of the economy is more important than say, 100,000 of its own citizens' lives.. Earlier today, the Trump administration extended the social distancing guidelines until April 30 ending any speculation that his administration would in fact choose that path of absurdity. Make no mistake about it, the opportunity cost on the economy from this decision is massive and indicates how seriously the president is taking the advice of his health care experts becasue it is clear that the president wants it opened as soon as possible.
Instead, it appears that Jair Bolsonaro is rolling the dice alone by choosing economy over people.
Yes, he really does seem to be be gambling that the disease is over-hyped. The gall of it is tremendous when you actually consider the stakes. We already know he is Bolsanaro is willing to trade off some lives for economic performance. How far is he willing to go? If cases rise in Brazil, will he change his tune? Will it be too late?
In memory of the recently deceased Kenny Rogers and his legendary song The Gambler, let Mr. Bolsanaro consider the sage advice offered up in the song...
YOU GOT TO KNOW WHEN TO HOLD 'EM
KNOW WHEN TO FOLD 'EM
KNOW WHEN TO WALK AWAY
AND KNOW WHEN TO RUN
YOU NEVER COUNT YOUR MONEY
WHEN YOUR SITTN' AT THE TABLE
THEY'LL BE TIME ENOUGH FOR COUNTIN'
WHEN THE DEALIN'S DONE
Well, he's playing his hand. I just can't see him counting any "money" when this is all said and done.
Revisiting introductory economic concepts in light Covid-19Posted by Joseph Semuta on 3/26/2020 1:00:00 AM
There is not an economic sector that is not being significantly impacted by Covid-19. In a sense, the story of the virus is its economic impact. The president himself has suggested that he would like the economy back at full capacity by Easter weekend, against the advice of the medical experts on his Coronavirus impact team.
Regardless of whether of not we are capable of reopening at that time remains to be seen, but the deep impacts on the economy are starting to emerge and they can act as a point of reference in our economic learning and understanding.
Consider some of the first lessons of the semester and the point that they were trying to drive home which is when you choose one course of action you cannot get the benefit of another course of action. It is the default mindset of an economist; life is filled with trade-offs. Their goal is to maximize saitsfaction. Let's do it!
But first let's ignore the incredible differences we would encounter when we consider benefit maximization and reflect back on the early discussions.
Should we fund a needle exchange program, or would the money be better spent on a different type of treatment facility? Or maybe not spend our tax dollars on support for drug addicts? Is cutting grass labor or leisure and how does that impact it perceived value? How much laboring is too much? Shoud we spend more on civilian goods or the military?
Consider where you stood then. How much has your thinking changed since those early discussions?
I would guarantee that many who supported a needle exchange program have changed their minds. How couldn't they? How could government fund that health crisis when there is a much larger crisis that impacts every citizen?
I couldn't, and I am supportive of programs in general.
But not now, there is a more pressing health issue.
I would also bet that many would feel that more should be spent on "butter" and less on "guns"right now. Jets and drones cannot kill a virus and the lack of medical equipment is disturbing.
If you want to comment, feel free but please keep it clean.
WelcomePosted by Joseph Semuta on 3/26/2020 12:15:00 AM
I wish this initial posting would have happened under different societal circumstances rather the cloud of uncertainty that is hanging ever so ominously over our heads.
But it didn't and for whatever reason my choices have led me to neglect this resource until this very point in time.
A time in history where technology is good enough to recognize that we are at the early stages of a global pandemic but not yet to the point where we can come up with an instant cure.
You know, like Star Wars or Avengers level technology.
But instead we are forced to retreat to our homes and limit contact in an effort to "flatten the curve" and slow the spread of the virus and hope that we do not exceed our health care system's capabilities.
Doctors and nurses should treat patients, not have to choose which ones get the opportunity for care.
That is what we are trying to avoid.
These are difficult times. Please continue to to do the right thing and maintain proper social distancing.