Make America Constitutional Again?

Make America Constitutional Again?

Tyler Durden

Fri, 07/31/2020 – 22:05

Authored by James Bovard via The American Institute for Economic Research,

The American political system may be on the eve of its worst legitimacy crisis since the Civil War. Early warning signals indicate that many states could suffer catastrophic failures in counting votes in November. The election will occur amidst the vast economic devastation inflicted by a political class that responded to COVID by seizing almost unlimited power. And Deep State federal agencies have already proven that they will trample the law to sabotage election results. 

America could soon see a hundred-times worse replay of the Florida presidential balloting 20 years ago in the Bush-Gore showdown. Some Florida counties had antiquated voting equipment while others had harebrained ballot designs that confounded voters. The Florida Supreme Court ordered a manual recount of disputed votes but the Supreme Court, in a 5-to-4 decision, stopped the recount because it could result in “a cloud upon what [George W. Bush] claims to be the legitimacy of his election,” Justice Antonin Scalia wrote. Two days, the same Supreme Court majority blocked any subsequent recounting because it was “not well calculated to sustain the confidence that all citizens must have in the outcome of elections.” Unfortunately, “legitimacy via blocked recounts” may also be the epithet for the 2020 presidential election. 

Because of the pandemic, many states are switching primarily to mail-in voting even though experiences with recent primaries were a disaster.

In New York City, officials are still struggling to count mail-in ballots from the June primary.

Up to 20% of ballots “were declared invalid before even being opened, based on mistakes with their exterior envelopes,” the Washington Post noted, thanks largely to missing postmarks or signatures. In Wisconsin, more than 20,000 “primary ballots were thrown out because voters missed at least one line on the form, rendering them invalid.”

Some states are mailing ballots to all the names on the voting lists, providing thousands of dead people the chance to vote from the grave. President Trump claims that the shift to mail-in voting could result in “the most corrupt vote in our nation’s history.” Trump is often wrong on issues but even a New York Daily News article tagged the recent primary results a “dumpster fire.” Delayed election results and potentially millions of disputed ballots could minimize support for whoever is designated the next president. 

Elections supposedly choose which candidates are selected to follow the law and uphold the Constitution, but COVID shutdown dictates vividly how political power is now practically unlimited. Michigan governor Gretchen Whitmer prohibited “all public and private gatherings of any size” (prohibiting people from visiting friends) and also prohibited purchasing seeds for spring planting in stores after she decreed that a “nonessential” activity. Oregon Governor Kate Brown banned the state’s four million residents from leaving their homes except for essential work, buying food, and other narrow exemptions, and also banned all recreational travel – even though much of her state had almost zero COVID cases. 

In the name of reducing risks, politicians entitled themselves to destroy tens of millions of jobs. Permitting governors to shut down churches was not on the ballot but that didn’t stop many states from banning worship services at the same time politicians cheered mass protests that scorned “stay-at-home” orders.

The media has often whitewashed the damage from COVID power grabs in part because every restriction was supposedly justified by “science.” After New York Gov. Andrew Cuomo dictated that nursing homes must admit COVID patients, more than 6,000 elderly nursing home residents were killed by the coronavirus. Cuomo has yet to reveal which “science” textbook spawned this policy (which several other states also imposed). Were those state governments grossly incompetent or were they murderous? It doesn’t matter because Trump made rude comments about N.I.H. honcho and media darling Anthony Fauci. What’s the point of voting for politicians who merely need to invoke dubious statistical extrapolations to sow death and economic devastation?

Finally, does the presidential election even matter?

Deep State federal agencies are a Godzilla that have established their prerogative to undermine if not overturn election results. The FBI has achieved saint-like status among many liberals for its efforts to topple Trump. For almost three years, the nation’s political life was roiled by an investigation driven by false allegations that the Trump campaign colluded with Russia in the 2016 election. As George Washington University professor Jonathan Turley observed last week, the media continues to ignore “one of the biggest stories in decades. The Obama administration targeted the campaign of the opposing party based on false evidence.” Obama officials who exploited the CIA and other intelligence agencies to illicitly target Trump campaign officials have laughed all the way to million-dollar book advances. 

During the Trump impeachment effort, the establishment media openly cheered the Deep State. New York Times columnist James Stewart assured readers that the secretive agencies “work for the American people,” New York Times editorial writer Michelle Cottle hailed the Deep State as “a collection of patriotic public servants,” and Washington Post columnist Eugene Robinson captured the Beltway’s verdict: “God bless the Deep State!” The media has almost completely abandoned its watchdog role, and its veneration will make it easier for the FBI, CIA, and National Security Agency to ravage not just elections but also Americans’ rights and liberties in the coming years.

Even before the voting starts, surveys show that for the first time “a majority of Americans (55 percent) are dissatisfied with their system of government,” the Atlantic reported. The percentage of Americans who “expressed trust in government in Washington” has fallen from 73% in 1958 to only 17% now, according to the Pew Research Center. But those numbers could quickly become far more ominous for our political ruling class. 

What happens if Trump continues to repel many if not most potential voters, and then Biden comes across in the presidential debates as clueless and doddering as did Special Counsel Robert Mueller in a congressional hearing last July? How many Americans will feel forced to choose between a scoundrel and an idiot?

Many pundits and professors presume that a Biden victory in November will magically re-legitimize the American political system. But almost all the problems of recent years will continue or intensify. The Centers for Disease Control and the Food and Drug Administration, both of which horribly botched the nation’s response to COVID, will continue bollixing public health crises. U.S. foreign policy will continue to be reckless and self-defeating, with American pretensions to global hegemony becoming ever more ludicrous. Deficit spending will continue to spin out of control, spiraling closer to the day when the Federal Reserve’s sorcery fails to entrance financial markets. Unfortunately, both Democrats and Republicans appear willing to bankrupt the nation to perpetuate their own power.

Federal legitimacy hinges on the Constitution, but there is not a snowball’s chance in hell that either Trump or Biden will “make America constitutional again.” As Thomas Jefferson declared in 1786, “An elective despotism was not the government we fought for.” What’s the point of voting if “government under the law” is not a choice on Election Day? American political legitimacy will continue plummeting as long as politicians scorn any legal and constitutional limits on their power.

via ZeroHedge News Tyler Durden

US Takes Unprecedented Step Of Imposing Sanctions On Assad’s Teenage Son

US Takes Unprecedented Step Of Imposing Sanctions On Assad’s Teenage Son

Tyler Durden

Fri, 07/31/2020 – 21:45

This week the US imposed a new round of sanctions against the Syrian government, and while this is nothing new, what is gaining attention is the unprecedented step Washington has taken against Bashar al-Assad’s teenage son.

Secretary of State Mike Pompeo cited that the continued sanctions under the ‘Caesar Act’ were geared toward ending Assad’s “brutal war against the Syrian people.”  

President Assad’s oldest son, 18-year old Hafez Bashar al-Assad (named after his grandfather who previously ruled Syria), is not known to be politically active or connected, and holds no office or decision-making abilities, but now under the new sanctions he won’t be allowed to travel to or have assets in the US, reports The Guardian.

When pressed US officials admitted that the action against Assad’s children are preemptive. US deputy assistant secretary of state, Joel Rayburn, was cited in the following:

Asked why Assad’s teenage son had been added to the list – he was born in 2001 – Rayburn said: “There has been a trend of senior Syrian regime actors and business people who have been active in the regime to do business through their adult family members to evade sanctions.”

“It seems very clear that the immediate family of Bashar al-Assad and their in-laws are attempting to consolidate economic power inside Syria so that they could use this to further consolidate political power.”

He said: “Assad would only use such power to strengthen the killing machine against the Syrian people”. He denied that the sanctions would have any impact on humanitarian trade or on the economy of Lebanon.

However, many analysts have pointed out that the sanctions are designed to ensure that Syria never recovers from its crushed war-time economy, not to mention the billions in damage to buildings, homes, and infrastructure across the country.

Hafez al-Assad, 18, is named after his grandfather, who ruled syria prior to Bashar. Image source: Reuters

Also interesting is the fact that the sanctions do not target al-Qaeda held Idlib province, nor the oil and gas rich northeast section of the country occupied by US forces in support of Kurdish-led Syrian Democratic Forces (SDF).

The far-reaching US sanctions now essentially “blacklist” anyone doing business with Damascus for any reason. As geopolitical commentator Jason Ditz points out: “This would cover a lot of basic commerce Syria might engage in in the course of reconstruction, particularly importing goods and services, and may force Syria to delay such rebuilding for lack of willing contractors.”

Thus it appears that the US war on Syria will grind on for many more years to come. 

via ZeroHedge News Tyler Durden

Black Lives Matter: An Immodest Suggestion

Black Lives Matter: An Immodest Suggestion

Tyler Durden

Fri, 07/31/2020 – 21:25

Authored by MN Gordon via,

We don’t like it.  But we won’t deny it.  America’s buried itself under an immense pile of public debt over the last 40 years.

Time to grab a shovel and some gloves.  There’s plenty of digging out to do.  There’s also plenty of opportunity in doing it.  We’ll have more on this in a moment.  First, the grim facts…

The national debt in 1980 was $908 billion. 

Today it’s over $26 trillion. 

New debt racked up in June alone – $863 billion – was more than the country added in its first 200 years of existence.

But as the national debt’s been piled on with ever increasing heaps over this time.  Economic growth has diminished to near subsistence levels.  The progression was gradual at first.  Yet over the last two decades the growing burden has become inescapable.

In the 1950s and 1960s, for example, the average GDP growth rate was above 4 percent.  Then in the 1970s and 1980s GDP growth declined to around 3 percent, where it held through the 1990s.  The 21st century, however, has been characterized by decreasing growth rates.  In fact, over the last decade, the average GDP growth rate has been below 2 percent.  That’s no joke.

The divergence between increasing debt heaps and diminishing growth has become wider and wider.  Whereas the debt to GDP ratio was 32 percent in 1980.  Today, it’s 110 percent.  Tack on U.S. unfunded liabilities – social security, Medicare Parts A, B, and D, federal debt held by the public, plus federal employee and veterans benefits – estimated to be over $153 trillion, and the debt to GDP ratio jumps to 637 percent.

However, this assumes GDP holds or continues to putter along at 2 percent.  The fact is, 2 percent GDP growth may be a wishful thing of the past.  Yesterday [Thursday], if you missed it, the Commerce Department reported that GDP isn’t growing; rather, it’s contracting – and it’s contracting a lot.  Specifically, it’s contracting at an annualized rate of 32.9 percent.

In other words, government debt is blowing out like a newborn baby’s diaper.  But that’s not all.  In addition to federal debt, there’s state, local, and private debt too…

Zombie Economics

State and local debt levels, in many jurisdictions, have also reached levels that are inescapable.  Outstanding U.S. mortgage debt’s approaching $15 trillion.  U.S. corporations are sitting on $10 trillion in debt.  And student loan debts at $1.6 trillion.

Rounding out the debt binge is $1.2 trillion in U.S. auto loans and nearly $1 trillion in credit card debt.  Unfortunately, all this debt dooms the economy to a perpetual state of zero to low growth for decades to come.  It also dooms the country to the social discord of a flailing economy.  Ruchir Sharma, writing for the Wall Street Journal, explains why:

“Easy money fuels the rise of giant firms and, along with crisis bailouts, keeps alive heavily indebted ‘zombie’ firms at the expense of startups, which typically drive innovation.  All of this leads to low productivity—the prime contributor to the slowdown in economic growth and a shrinking of the pie for everyone.

“At the same time, easy money has juiced up the value of stocks, bonds and other financial assets, which benefits mainly the rich, inflaming social resentment over growing inequalities in income and wealth.  It should not be surprising that millennials and Gen Z are growing disillusioned with this distorted form of capitalism and say that they prefer socialism.  The irony is that the rising culture of government dependence is, in fact, a form of socialism—for the rich and powerful.”

Indeed, the massive debt buildup and zombification of large swaths of corporate America is a severe hindrance to productivity.  Rather than fueling new businesses and new investments, the economy will function to service and roll over debt in perpetuity.  It will take a productivity miracle to ever get back to sustained GDP growth above 2 percent.

Black Lives Matter: An Immodest Suggestion

Where will America’s productivity miracle come from? 

Public education is not teaching students what they need to know to compete in the global economy.

According to the National Center for Education Statistics, math scores of U.S. students rank 30th in the world.  The East Asian peers of today’s American students will eat their lunch in the growth industries of tomorrow.

Here’s where Black Lives Matter has a real opportunity.

The protests.  The riots.  The calls for reparation payments.  Social justice wealth transfers.  White privilege taxes.  All the nonsense.  Where’s the strategy?  Where’s the long-range ‘strategery’?

No doubt, those selling BLM T-shirts in Walmart parking lots are exercising gumption.  But it’s not gonna cut it.  Moreover, like bingo winnings, reparation payments will be quickly squandered while the unhappiness remains.

Here at the Economic Prism we hesitate to offer advice.  We don’t know the answers.  We hardly know the questions.  But we do observe, contemplate, and reflect…

And as far as we can tell the BLM movement is empty of ideas and without direction.  Hence, from a place of modesty, we offer an immodest suggestion:

If BLM was strategic they’d be fighting for school vouchers to start pumping out semiconductor engineers 10 to 12 years from now.

Within half a generation they could take a significant role in driving America’s much needed productivity miracle.  Apathy would be replaced with dignity. 

The politics of race, class, identity would be vanquished.

Certainly, it would take hard work and relentless perseverance.  Yet it’s within reach…for those willing to take a grab at it.

Bottom-line, performance is the only measure.  Professional sports has shown that the best performers make the big bucks, regardless of race.  Why not become top performers in a high-paying growth industry?

This is an industry where America’s up and coming generation has fallen a step behind its global competitors.  There’s a need.  There’s demand.

You can thank us in 2030.

via ZeroHedge News Tyler Durden

Google Says New ‘Contact Tracing’ App To Launch In Coming Weeks

Google Says New ‘Contact Tracing’ App To Launch In Coming Weeks

Tyler Durden

Fri, 07/31/2020 – 21:05

Shortly after launching a new contact-tracing program in Ontario, a top Google executive said in a blog post published Friday that 20 US states and territories (roughly 45% of the country’s population) are “exploring” using the tool Google built with Apple to create new contact-tracing programs, and that the new apps are set to launch in the coming weeks.

Google had previously said in May that three states, Alabama, North Dakota and South Carolina, would be launching apps using the exposure notification tool. Those states are still using the protocols, it appears.

Additionally, the company said during its update that 16 countries and regions outside the US have launched apps using the Apple-Google tool, while other countries – including France and the UK – have sought to build their own tools from scratch, though the UK infamously pivoted, abandoned its custom system, and adopted the Google-Apple protocol.

However, the UK has yet to launch this new app, and it’s unclear when it will be ready, as the Telegraph recently reported.

Here’s how the UK’s app-based system (which is based on the Google-Apple system) is supposed to work, per the Telegraph.

Source: The Telegraph

The technology should enable users to track whether they came in contact with any infected people via bluetooth signals.

VP of Engineering David Burke penned the post, which was published Friday afternoon on the East Coast. Read it in full below:

* * *

In May, we partnered with Apple to launch the Exposure Notifications System (ENS) and made it available to public health authorities around the world in their fight against COVID-19. The ENS allows public health authorities to develop apps that augment manual contact tracing efforts while preserving the privacy of their citizens. As of today, public health authorities have used ENS to launch in 16 countries and regions across Africa, Asia, Europe, North America and South America, with more apps currently under development.

In the United States, 20 states and territories—representing approximately 45 percent of the U.S. population—are exploring apps based on ENS. We expect to see the first set of these apps roll out over the coming weeks. The Association of Public Health Laboratories also announced recently that it will host a national key server to support all U.S. states, which will allow people with Exposure Notification apps to receive alerts even if they travel across state borders.

We’ve continued to improve the technology and provide more transparency based on feedback we’ve received from public health authorities and other experts. Public health authorities will continue to make their own decisions about how exposure notifications become part of their plans in controlling COVID-19, and we will work to improve the technology in response to their feedback. Here are some of the changes we’ve already made, as well as some upcoming additional changes.

Improvements to the Exposure Notification API

Since the Exposure Notification API was publicly released in May, we’ve spoken with dozens of public health authorities to understand how the API could be improved to help them better manage the COVID-19 pandemic while preserving privacy. Based on this feedback, we recently launched an update to the API, which includes the following changes:

When an exposure is detected, public health authorities now have more flexibility in determining the level of risk associated with that exposure based on technical information from the API.

Bluetooth calibration values for hundreds of devices have been updated to improve the detection of nearby devices.

The API now supports interoperability between countries, following feedback from governments that have launched Exposure Notification apps.

To help public health authorities build apps more efficiently, we’ve added reliability improvements for apps and developer debug tools.

We’ve improved clarity, transparency and control for users. For example, the Exposure Notifications settings on Android now include a simple on/off toggle at the top of the page. In addition, users will also see a periodic reminder if ENS is turned on.

Technical guidance and transparency

We’ve heard feedback that public health authorities and developers want more technical guidance about how ENS works. In response, we’ve published the following resources over the last few weeks:

Reference verification server to help guide public health authorities in building a server that allows verification of test results when users report themselves as positive for COVID-19.

Implementation code showing how the Exposure Notification API works underneath the hood.

Telemetry design explaining what de-identified diagnostics data is collected to ensure that ENS is functioning properly and securely.

Additional technical resources will be publicly shared as we continue to improve ENS.

Education and privacy protections

The Exposure Notifications website has more information about ENS, and offers educational and technical resources, as well as the latest updates.

As a quick reminder, here are some of the core privacy protections that were built into ENS:

You decide whether you want to use Exposure Notifications—it’s off unless you turn it on.

ENS doesn’t use location data from your device.

Your identity is not shared with Google, Apple or other users.

Only public health authorities can use this system.

Finally, we’ve received questions about why your Android device location setting has to be turned on if you want to use an Exposure Notification app. We want to explain why this particular setting needs to be on, and how you can control your location settings on Android.

To be absolutely clear, ENS does not use device location, and the policies for using ENS prohibit public health authority apps from requesting or collecting device location. Instead, ENS uses Bluetooth technology to detect when two devices are near each other, without revealing the location of either device. While Bluetooth scanning doesn’t necessarily reveal location, it can in some cases be used to infer your device’s location. For example, if a shopping app scans for the Bluetooth signals of a stationary Bluetooth beacon located inside a store, then the app could infer that you went to that store. So in 2015, with privacy in mind, we designed the Android operating system to prevent Bluetooth scanning unless the device location setting is on. At that time no one could have anticipated that Bluetooth scanning might one day be helpful in controlling a global pandemic like COVID-19.

Our engineering teams have been working to update the next version of Android with Exposure Notifications in mind. On Android 11, which will soon be released, users will be able to use Exposure Notification apps without turning on the device location setting. We’re making this update for Exposure Notifications only, given that ENS has been designed in such a way that neither the system nor the apps using it can infer device location through Bluetooth scanning, and apps that are allowed to use ENS are subject to additional policies that disallow automatic collection of location. All other apps and services will still be prohibited from performing Bluetooth scanning unless the device location setting is on.

But even in current versions of Android, when you turn on the device location setting, your phone continues to prohibit access to any apps, including Google apps, that don’t have permission to use device location. The device location setting is like a circuit breaker in a house: When it’s on, power is flowing to the house, but you can turn the lights on or off in each room. If you turn on the device location setting to use ENS, it won’t affect the decisions you’ve already made about specific apps. You can always view and change which apps have access to your device location by going to Settings > Location > App permissions.

We’re committed to supporting public health authorities as they build tools to fight COVID-19. We’ll continue to improve ENS based on feedback, while ensuring that people can trust in the privacy-preserving design of this technology.

* * *

Source: Google


via ZeroHedge News Tyler Durden

Why The Iran-China Oil Alliance Is So Important

Why The Iran-China Oil Alliance Is So Important

Tyler Durden

Fri, 07/31/2020 – 20:45

Via Defense and Foreign Affairs,

The steady rise in U.S. strategic competition with the People’s Republic of China (PRC) over trade and the South China Sea already has so many dimensions that it is sometimes easy to ignore shifts in the PRC’s behavior in other areas. On July 6, 2020, Iranian Foreign Minister Javad Zarif announced that Iran was negotiating an agreement with the PRC – with which it long has had trade and strategic links – which would now make the two countries the equivalent of strategic partners.

This expanded U.S.-PRC competition to new parts of the world. Perhaps more importantly, the move is a substantive and significant response to India’s success in militarily outmaneuvering the PRC in Kashmir during June 2020.

The PRC-Iran accord means the end of Indian use of the Iranian port of Chah Bahar and the construction of a rail link from that port city northward to link with a new rail spur into Afghanistan. India’s moves into Kashmir in 2019-2020 are widely perceived in Beijing to presage a new move by India to cut off the PRC-Pakistan landbridge through Pakistani controlled Azad (Free) Kashmir, giving India its own landbridge to Central Asia.

Thus, after the confrontation between the Indian Army and People’s Liberation Army (PLA) troops in the Ladakh region of Kashmir on June 15-16, 2020, Beijing determined it would respond by cutting Indian access to Central Asia through Iran. The first signs came as the Iran-PRC deal was announced and the Iranian government canceled the Chah Bahar to Zahedan rail link which was to be built by India, citing Indian delays on the 628 km project. The Iranian government said that it would complete the line on its own, with a $400 million investment from the Iranian National Development Fund to the Iranian Railways.

Indian Prime Minister Narendra Modi had gone to Tehran in May 2016 to sign the Chah Bahar deal, but work was indeed delayed as India fretted that the project might invoke U.S. sanctions against India.

The PRC-Iran agreement could involve serious military ties and lead to major PRC defense sales to Iran, involve some $400 billion in PRC economic investment over 25 years, and lead to a major PRC role in modernizing Iranian railroads, ports, 5G Networks, and telecommunications generally. In return, the PRC would get discounted supplies of Iranian oil products and gas for the next 25 years.

The PRC would be able to make Iran part of its Belt and Road Initiative (BRI), and be able to establish free trade zones in Iran in Maku in the northwest, Abadan in Khuzestan Province near Iraq, and Qeshm island just inside the Persian Gulf near the Strait of Hormuz.

The agreement would give the PRC access to Jask, a major Iranian port outside the Strait of Hormuz. The PRC began developing its strategic position in the Persian Gulf region during the Iran-Iraq war as far back as 1980-1988. And the PRC presence in the Persian Gulf has only increased since that time.

PRC activity over the last decade shows a clear intent to secure its energy imports from the Persian Gulf, compete with the U.S. and India, and look toward a day when it would be as real a power in the Persian Gulf and the Indian Ocean as it was striving to be in Asia and Pacific.

The PRC had also made Pakistan a key partner in its Belt and Road Initiative, and the PRC now plays a key part in developing and managing the Pakistani port of Gwadar, on the Arabian Sea. The PRC also invested some $10.7 billion into transforming an Omani fishing village into the special Economic Zone Authority of Duqm. But, significantly, Oman has reserved significant parts of the maritime facilities at Duqm for British and U.S. forces.

The PRC has taken these steps for both economic and strategic reasons. In 2019, Beijing attempted, without success, to bring Saudi Arabia and the United Arab Emirates into its orbit. It found it could not, however, have a strategic relationship with Iran and the Arabian Peninsula states simultaneously. It stayed with the more significant choice, Iran.

It is vital to the PRC to secure its access to the Persian Gulf oil and gas, and limit U.S. capability to influence this flow to the PRC during a crisis or war. The PRC imports more than 70 percent of its petroleum, and gets more than 40 percent of its supplies from the Persian Gulf.

Iranian-PRC trade and strategic linkages in many ways circumvent U.S. attempts to sanction the leadership of both states. At a time when both sanctioned states have come under great pressure, the new alliance, then, offers Beijing and Tehran some real respite and strategic resilience. Adding Russia into the mix only widens the trading zone of both states.

The real challenges, however, comes from whether the PRC economy can be sustained for the duration of the new accord, and whether an Indian military thrust to cut off the Pakistan corridor to the PRC will cause grave difficulties for Beijing.

But, certainly, the new deal with Iran is Beijing’s signal that it is planning for the day when the Pakistan corridor to the Indian Ocean may be lost to it.

via ZeroHedge News Tyler Durden

Responding To Criticism, Elon Musk Tells The World That Him And Bill Gates Are Not “Lovers”

Responding To Criticism, Elon Musk Tells The World That Him And Bill Gates Are Not “Lovers”

Tyler Durden

Fri, 07/31/2020 – 20:25

“The rumor that Bill Gates & I are lovers is completely untrue.” 

Those are the actual words that the CEO of $270 billion Tesla tweeted out on Thursday, probably when he should have been working, in response to comments that Bill Gates made the day prior on CNBC.

Gates had appeared on CNBC to talk about the conspiracy theories associated with the coronavirus pandemic and, in the process, wound up taking a shot at Musk, who has been notoriously wrong about almost all of his coronavirus predictions (for instance, that there would be no new cases by the end of April).

Gates said of Musk: “Elon’s positioning is to maintain a high level of outrageous comments. He’s not much involved in vaccines. He makes a great electric car. And his rockets work well. So he’s allowed to say these things. I hope that he doesn’t confuse areas he’s not involved in too much.”

This, of course, set off Musk, who had to stop whatever humankind-altering project he was working on at the time (monkeys solving Rubik’s cubes?) and respond on Twitter. He also wrote “Billy G is not my lover,” a lame reference to the Michael Jackson song “Billy Jean”.

Recall, back in March we reported that America’s favorite sociopath CEO had Tweeted out that the coronavirus panic was “dumb”. Just hours after that, he again took to Twitter to double down on his statement and defend his reasoning using a word salad of half-assed smart-sounding terms that amounted to one giant non-sequitur.

Asked by another Twitter user what his reasoning was for calling the coronavirus panic “dumb”, Musk responded by Tweeting:

“Virality of C19 is overstated due to conflating diagnosis date with contraction date & over-extrapolating exponential growth, which is never what happens in reality. Keep extrapolating & virus will exceed mass of known universe!”

We can’t believe we’re going to say this: but we’re rooting for Bill Gates on this one.

via ZeroHedge News Tyler Durden

Universal Basic Income Is Not An Economic Savior

Universal Basic Income Is Not An Economic Savior

Tyler Durden

Fri, 07/31/2020 – 20:05

Authored by Lance Roberts via,

According to a new study by the left-leaning Roosevelt Institute, a universal basic income could permanently make U.S. economy trillions of dollars larger. While such socialistic policies sound great in theory, history, and data, show it isn’t the economic savior it is touted to be.

What Is A Universal Basic Income (UBI)

To understand why the theory of universal basic incomes (UBI) is heavily flawed, we need to understand what UBI is.

Basic income, also called universal basic income (UBI), is a public governmental program for a periodic payment delivered to all citizens of a given population without a means test or work requirement. Basic income can be implemented nationally, regionally, or locally, and is an unconditional income sufficient to meet a person’s basic needs (i.e., at or above the poverty line).

The idea of guaranteed income is not a new thing. According to Wikipedia:

“The concept of a state-run basic income dates back to the early 16th century when Sir Thomas More’s “Utopia” depicted a society where every person receives a guaranteed income. 

In the late 18th century, English radical Thomas Spence, and American revolutionary Thomas Paine, declared their support for a welfare system that guaranteed an assured basic income. Nineteenth-century debate on basic income was limited, but during the early part of the 20th century, a basic income called a “state bonus” was widely discussed. 

In 1946, the United Kingdom implemented unconditional family allowances for every family’s second and subsequent children. In the 1960s and 1970s, the United States and Canada conducted several experiments with negative income taxation, a related welfare system. From the 1980s and onward, the debate in Europe took off more broadly, and since then, it has expanded to many countries around the world. “ 

While the idea of a UBI sounds good in theory, as discussed previously, they fail to work in reality.

UBI Won’t Increase Economic Growth

“More money in people’s pockets will lead to stronger economic growth.” – J.M. Keynes

Such is the underlying sentiment behind a universal basic income and its impact on economic growth. Unfortunately, it simply isn’t true.

Let’s run a hypothetical example using GDP from 2007 to the present. (I am using estimates of -4.3% for 2020 GDP growth) In 2008, in response to the “Financial Crisis,” Congress passes a bill providing $1000/month ($12,000 annually) to 190 million families in the U.S. 

The chart below shows the economy’s annual GDP growth trend assuming the entire UBI program shows up in economic growth. For those supporting programs like UBI, it certainly appears as if GDP is permanently elevated to a higher level. 

When you look at the annual rate of change in economic growth, which is how we measure GDP for economic purposes, a different picture emerges. In 2008, when the $12,000 arrives at households, GDP spikes, printing a 17% growth rate versus the actual 1.81% rate.

However, beginning in 2009, the benefit disappears. The reason is that after UBI is injected into the system, the economy normalizes to the new level after the first year. Also, notice that GDP grows at a slightly slower rate as dollar changes to GDP at higher levels print a lower growth rate.

UBI’s Dark Side

Of course, the money to provide the $12,000 UBI benefit had to come from somewhere.

According to the Center On Budget & Policy Priorities, in 2019, roughly 75% of every tax dollar went to non-productive spending. 

“In the fiscal year 2019, the Federal Government spent $4.4 trillion, amounting to 21 percent of the nation’s gross domestic product (GDP). Of that $4.4 trillion, federal revenues financed only $3.5 trillion. The remaining $984 billion came from debt issuance. As the chart below shows, three major areas of spending make up most of the budget.”

Think about that for a minute. In 2019, 75% of all expenditures went to social welfare and interest on the debt. Those payments required $3.3 Trillion of the $3.5 Trillion (or 95%) of the total revenue collected.

That was BEFORE the shutdown of the economy due to COVID-19. Given the subsequent decline in economic activity occurring this year, those numbers become markedly worse. Given this bit of data, all universal basic income payments would have had to come solely from debt.

The table below shows the increase in total Federal Debt adjusting for the annual UBI payment. 

The chart below takes our hypothetical example and compares the impact of the additional debt on the Federal deficit from the implementation of UBI.

While the “theoretical models” assume that UBI will create enough economic growth and prosperity to “offset” the increase in debt, 40-years of history suggest otherwise.

UBI Won’t Increase Economic Growth

As discussed previously, there is a high correlation between debts, deficits, and economic prosperity. 

“The relevance of debt growth versus economic growth is all too evident, as shown below. Since 1980, the overall increase in debt has surged to levels that currently usurp the entirety of economic growth. The growth in debt continues to divert more tax dollars away from productive investments into the service of debt and social welfare.”

However, simply looking at Federal debt levels is misleading.

It is the total debt that weighs on the economy.

Under the current economic situation, it currently requires nearly $4.00 of debt to create $1 of economic growth. However, if you added UBI into the equation, it would require roughly $5 per $1 of growth. (Unfortunately, at the current spending rate, the U.S. will be approaching the $5 mark by the end of 2020)

If you don’t understand the implications of debt on economic growth, let me rephrase the analysis for you.

For instance, in the 30-years from 1952 to 1982, the economy ran at a surplus. That surplus fostered rising economic prosperity in the U.S. which averaged roughly 8%. 

Since 1980, the economic deficit has continued to erode economic prosperity. As shown, there has been no organic growth without increases in debt. Due to the need to increase debt to fund it, UBI would only succeed in exacerbating the situation.

The UBI Test Has Already Failed

The United States already has a semi-UBI plan. It is an effectively bankrupt system called “Social Security.” 

The collapse in economic growth has resulted in a collapse in Federal Tax revenue needed to pay for the massive social welfare schemes in the U.S.

It now requires more than of 100% of tax receipts just to meet the mandatory spending of social welfare and interest on the debt. In other words, we are now going into debt more just to provide social assistance.

How bad is it?

Social Security will be insolvent and unable to pay the full value of promised benefits by 2035. Social Security’s costs will exceed its income by 2020, according to a new report published Monday by the program’s trustees.

At the end of 2018, Social Security was providing income to about 67 million Americans. About 47 million of them were over age 65, and the majority of the rest were disabled. If nothing changes, the Social Security Trust Fund will be fully depleted by 2035. If such occurs, the program will impose across-the-board cuts of 20 percent to all beneficiaries.”

Getting Worse

That report, dire in its warning already, was issued before the “Pandemic” and “economic shutdown.”

Meanwhile, demographics are blowing up the basic premise of the funding of Social Security. There were 2.8 workers for every Social Security recipient in 2017. That’s down from 3.3 in 2007, and that’s way down from the 5.1 workers per beneficiary that existed in 1960.

Furthermore, the two programs function mostly as a giant conveyor belt to transfer wealth from the young and relatively poor to the old and relatively rich. Such allows the average person (who now lives to be 78) more than a decade of taxpayer-funded retirement.

Welfare now makes up the highest percentage of disposable personal incomes in history despite record low unemployment, rising wage growth, and the longest economic expansion in U.S. history.

During the “Great Depression,” the economically devastated masses would form “breadlines.” Today, those “breadlines” form at the mailbox. Without government largesse, many individuals would be living on the street.

The chart above shows all the government “welfare” programs and current levels to date. The black line represents the sum of the underlying sub-components. Since the onset of the “pandemic,”  both unemployment insurance and “other benefits” have surged by $3 trillion. Those increases are in excess of the continued increases in all other benefits, like social security, Medicaid, and Veterans’ benefits.

Importantly, for the average person, these social benefits are critical to their survival. Government assistance now makes up ~38% of real disposable personal incomes. With more than 1/3rd of incomes dependent on Federal assistance, it should not be surprising the economy continues to struggle. Recycled tax dollars used for consumptive purposes, has virtually no impact on increasing economic activity.


In its essential framework, a universal basic income sounds excellent. Everyone has their basic needs covered. Then they can go out and produce and not worry about covering critical bills. In reality, the additional income is quickly absorbed into the economy as prices rise (inflation) to compensate for the extra spending. After the first year, the UBI has to be increased or no longer has any benefit. 

Therein lies the trap with all socialistic programs.

While UBI, along with free healthcare, education, childcare, etc., sounds great, they are NOT productive investments that have a higher return than the carrying cost of the debt. In actuality, history suggests these welfare supports have a negative multiplier effect in the economy.

Most telling is the inability of the current economists, who maintain our monetary and fiscal policies, to realize the problem of trying to “cure a debt problem with more debt.”

The Keynesian view that “more money in people’s pockets” will drive up consumer spending, with a boost to GDP being the result, has been wrong. It hasn’t happened in 40 years.

We fear that these socialistic programs, which promises “free everything” with no consequences, instead delivers inflation, generates further income inequality, and ultimately higher social instability and populism. Such has been the result in every other country which has run such programs of unbridled debts and deficits.

While UBI sounds excellent at the conversational level, so does “communism” and “socialism.” In practice, the outcomes have been vastly different than the theory.

As Dr. Woody Brock aptly argues:

“It is truly ‘American Gridlock’ as the real crisis lies between the choices of ‘austerity’ and continued government ‘largesse.’ One choice leads to long-term economic prosperity for all; the other doesn’t.”

Take your pick. 

via ZeroHedge News Tyler Durden

Egypt Receives Advanced Russian Fighter Jets Over US Lingering Sanctions Threat

Egypt Receives Advanced Russian Fighter Jets Over US Lingering Sanctions Threat

Tyler Durden

Fri, 07/31/2020 – 19:45

Ignoring the lingering threat of Washington sanctions, Egypt is moving forward with a purchase of large batch of Russian Su-35 “Flanker” jet fighters

The first batch of Su-35’s are now said to en route to Cairo this week, after in 2019 Egypt signed an agreement to purchase more than 20 Su-35 fighter jets from the Kremlin in a $2 billion deal.

The whole arrangement is awkward for the US defense establishment, given that it works so closely with the Egyptian military, and has done so for years going back to the Camp David Accords. 

Via The Drive

Last last year, soon after the controversial deal was inked, a US official announced that the “United States could impose sanctions on Egypt and block it from future military sales if it goes ahead with a purchase of Russian warplanes” — but now that the planes have reportedly already been shipped, it’ll be interesting to see if the threat is followed through upon.

The news and analysis source Middle East Monitor previously offered the central rationale to Washington’s objections to its ally Egypt acquiring the aircraft: in addition to the obvious problem of the Kremlin’s growing influence in the region, the US has for decades honored its unofficial policy of ensuring that Israel keeps a “qualitative edge” over all potential rivals when it comes to defense technology. 

The US has previously threatened other countries with sanctions under its Countering America’s Adversaries Through Sanctions Act (CAATSA) for purchases of Russian military equipment (Serbia being a recent example, related to rumors that it’s mulling S-400 anti-air acquirement).

Cairo eyeing the advanced Russian fighter might be viewed as an especially insulting affront by the Trump administration especially given that as the second largest recipient of foreign aid historically (after Israel), Washington has provided billions in economic and military aid to Egypt over the past years, including its F-16 fighters.

via ZeroHedge News Tyler Durden