Month: March 2018

The U.S. had its most recent recession between December 2007 and June 2009. Even 10 years since it began, the country’s job market is still feeling its impact.

Some states have recovered well from the recession but, as Statista’s Niall McCarthy points out, others are still struggling today and seven of them had fewer jobs in 2017 than 2007, according to CareerBuilder data.

That’s despite the nation as a whole having around 6.7 million more jobs in 2017 than 2007. The list of states with fewer jobs last year included Alabama, West Virginia, Mississippi, New Mexico, Connecticut, Wyoming and Illinois.

CareerBuilder’s research also revealed the occupations that are thriving since the end of the recession.

You will find more infographics at Statista

The fastest rates of growth were seen among home health aide positions with almost 300,000 jobs added between 2007 and 2017.

During the same time period, web development jobs grew 38 percent while veterinary technologist and technicians went up 32 percent.

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Authored by Pepe Escobar via The Asia Times,

Perhaps a Confucian path would be the right direction toward Eurasian integration

The Chinese constitutional amendment allowing Xi Jinping the possibility of further presidential terms – staying in power long enough to bring “national rejuvenation” combined with the Russian election re-confirming Vladimir Putin in the presidency have assured consistency and continuity for the Russia-China strategic partnership way into the next decade.

This will facilitate the interaction between the Belt and Road Initiative (BRI) and the Eurasia Economic Union (EEAU); policy coordination inside the Shanghai Cooperation Organization, the BRICS and the G-20; and the overall drive towards Eurasia integration.

The strengthening of what should be viewed as the Putin-Xi era could not but render Western liberals – and neoliberals – absolutely livid.

Capitalist interests have always believed their own propaganda narrative, which directly links capitalist expansion with the inevitable spread of democracy.

Critical thinking is, at last, debunking it as a grand illusion.

What in fact happened since the early 1980s was that Western turbo-capitalism avidly profited from a variation of neo-slave labor in China’s Special Economic Zones (SEZs). Compound it with the proverbial hubris of Western elites betting that China — regarded at best as a source of cheap labor as well as an enfeebled Russia during the 1990s would never accumulate enough know-how to challenge the West, geoeconomically and geopolitically.

The historical record is implacable, showing there’s no connection whatsoever between “free” trade – usually freer for those with extra economic heft and political liberalization. For instance, the Prussian monarchy lowered trade barriers and that led to the creation of the Zollverein in 1834. And the Third Reich between 1933 and 1938 offered a heady mix of hardcore capitalism and totalitarianism.

China’s system, where a (Marxist) party controls the state for the purposes of national cohesion certainly does not qualify as a liberal democracy. Dissenter Minxin Pei, the author of  China’s Trapped Transition, already knew 12 years ago that the Chinese Communist Party (CCP) would never go the Western liberal democracy way (Pei did understand Little Helmsman Deng Xiaoping’s commands to the letter).

He got it right that China has “no interest in becoming a member of the [Western] club. They want the economic benefits from the Western liberal order but reject its political values and fear its security alliances. Now they are in a strong enough position attempting to build their own clubhouse.”

What Pei got wrong is that the CCP would smother China’s economic growth (“The prospect of a Japanese-like stagnation is real.”) Xi Jinping and his new dream team need enough time to successfully tweak the Chinese economic model.

Away from childish 24/7 demonization, the fact is Russia today is a democracy, albeit imperfect. And it’s important to analyze how a young democracy can be manipulated. The third chapter of new book Manifest-Destiny: Democracy as Cognitive Dissonance details the rape of Russia; how Boris Yeltsin’s “free market reforms” facilitated by the “Harvard boys” allowed a small coterie of billionaire oligarchs — Mikhail Khodorkovsky, Boris Berezovsky and Roman Abramovich among them — to take over an economy suffering from shock therapy.

Between 1991 and 1997 Russian GDP collapsed by a whopping 83% while investment into the economy fell by 92%.

The case of Khodorkovsky is emblematic. Through Yukos, he owned key Siberian oil fields and was about to sell them all to Western corporate interests back in 2003 when Putin went after him. There’s no question this was avidly studied by the Beijing leadership. Control of key national resources is the ultimate red line.

For Putin as well as Xi, the supreme arbiter is the national state, not a bunch of oligarchs like it’s become a norm across the liberal and neoliberal West. On a BRICS level, compare it with the current usurper installed in the Brazilian presidency, who’s doing his best to hand over most of the pre-salt oil reserves as well as aviation giant Embraer to foreign interests.

When in doubt, ask Confucius

It has become a ritual for guardians of the Western establishment to weep hard about the “fading liberal world order.” At least some admit it is “neither liberal nor worldwide nor orderly.”

Lesser guardians may be more realistic, noting how Western politicians have been completely bypassed by popular anger in myriad latitudes, yet still believing it’s possible to “rebuild democracy’s moral foundations.”

It’s not — not under the predominant neoliberal creed, the post-mod TINA (there is no alternative). The guardians, left and right, cannot possibly understand the rise of populism — because those under the populist influence clearly see how the myths of “rule of law” and “national sovereignty” are fast dissolving in the mud. The guardians at best mourn, nostalgically, “the loss of elite influence.”

China, Russia, Iran and Turkey  – all implicated in Eurasia integration  – may all rank as authoritarian systems at different levels. And cases can be made that, with the exception of China they still underperform economically compared to their true potential.

Yet one thing they value most of all is national sovereignty amid a multipolar system. That’s their conceptual counterpoint to the il(liberal) world (dis)order. That’s their answer to TINA.

As for “the loss of elite influence,” that’s code for a self-described coterie of the wealthy and powerful claiming a fuzzy democracy moral high ground which only unmasks their deep fear as the Western unipolar moment dissolves sooner rather than later.

All these contradictions are in sharp relief when we look at the European Union. The EU, since the Maastricht treaty, has been steered into becoming what Angela Merkel herself defined as Bundesrepublik Europa — the Federal Republic of Europe.

Anyone familiar with Brussels knows how those waves of tax-free Eurocrats milk an ultra-centralized and bureaucratically Kafkaesque regulation system as they remain completely out of touch with normal, real-life Europeans.

The EU’s notion of promoting “economic integration”  including heavy doses of austerity could not be more anti-democratic.

Add to it scandals at top state level that do nothing but corrode the belief in the primacy of the Western liberal democracy model. The latest involves the real possibility that Colonel Gaddafi probably financed the 2007 Sarkozy presidential campaign in France; an outstandingly murky affair featuring the politics of energy, the politics of water, and the proverbial major weapons contracts through which Western liberal democracies discard any moral high ground.

Now compare it with Xi Jinping as hexin lingdao (the nucleus of the leadership) a sort of primus inter pares in a Sinified version of Plato’s Republic. Greek-Roman-Enlightenment political theory is not the only game in town anymore. Yet not a chance the hubristic West will start listening to Confucius.

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Cerberus Capital Management has officially eaten its initial investment in Remington as the country’s oldest firearms manufacturer officially filed for Chapter 11 bankruptcy late Sunday after unveiling a plan last month to surrender most of the company’s assets to its creditors. CNNMoney reported that the company agreed to reduce its debt by $700 million through the Chapter 11 process and contribute $145 million to its subsidiaries as part of the deal.

Cerberus will shed its ownership once the bankruptcy is complete.

Falling gun sales in recent years combined with high debt levels and a bleak sales outlook (now that President Trump is in office and Republicans are seen as more likely to protect gun rights) are making life difficult for firearms manufacturers.

Remington, which is buried under nearly $1 billion in debt, announced a debt restructuring plan on Feb. 12, two days before the school shooting in Parkland, Florida. Since then, some retailers have reacted by dropping sales of firearms – most notably Dick’s Sporting Goods, which announced a ban on the sale of assault rifles and Walmart, which raised the minimum age to buy guns to 21.

Remington makes the Bushmaster AR-15-style rifle that was used in the Sandy Hook shooting in Connecticut that left 20 first-graders and six educators dead in 2012. The company was cleared of wrongdoing in the shooting, but investors swiftly shunned Cerberus Capital Management, the company’s owner, according to the Associated Press.

Gun makers have reported precipitous declines in profits over the past year thanks to the drop in sales.

After 8 years of almost incessant rises in NICS Firearms Checks (a proxy for ‘legal’ arms sales) under President Obama, the number of checks declined last year.

 

Remington announced in February that it would reduce its $950 million debt load in a deal that will transfer control of the company to creditors. It plans to wrap up its bankruptcy as soon as May 3, according to CNN.

The company’s announcement came just two days before 17 people were killed at a high school in Parkland, Florida, on Feb. 14 – a massacre that sparked an intense campaign for gun control by activists.

Remington plans to keep on making guns. The company said, when it first announced its plan to file for bankruptcy in February, that operations “will not be disrupted by the restructuring process.”

Founded in 1816, Remington is one of the oldest and best-known gun makers in the world.

Remington is headquartered in North Carolina. It makes handguns, shotguns and rifles at its 19th-century factory in Ilion, NY, and is a cornerstone of the region’s economy.

While Cerberus has been wiped out, Remington’s creditors might have reason to be optimistic. With the “March for our Lives” attracting hundreds of thousands of Americans, pressure on lawmakers to crack down on gun sales is growing. And any sign of an impending crackdown will likely send gun sales soaring again.

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Via TheAntiMedia.com,

Following a lengthy silence in the wake of the Cambridge Analytica scandal, where it was revealed that a data firm was able to obtain personal information from over 50 million Facebook accounts, company CEO Mark Zuckerberg finally spoke out last week.

“We have a responsibility to protect your data, and if we can’t then we don’t deserve to serve you,” Zuckerberg wrote in a Facebook post. “I’ve been working to understand exactly what happened and how to make sure this doesn’t happen again.”

Facebook’s top dog then embarked on a small media tour, addressing several of the major concerns highlighted by the unsavory affair. While speaking with the Wall Street Journal, for instance, Zuckerberg said his company has launched an investigation into third-party developers who are “doing bad things” with users’ personal data on the Facebook platform.

But he also admitted that “like any security precaution, it’s not that this is a bulletproof solve” and that no mechanism “by itself is ever going to find every single thing.”

While it’s great that the company is taking a proactive step, the effort is not likely to comfort those users who feel their privacy has already been violated. What’s more, Zuckerberg conceded in the interview that the investigation may take months or more to complete.

In the meantime, options are available to those who refuse to simply wait around while Facebook gets its collective act together.

For starters, stop using the “log in with Facebook” option after downloading an app. It may take a bit longer to create a new account, but the app won’t get instant access to private information from your Facebook profile, which the company itself admits is what happens.

For the apps you’re already using, there’s a fairly simple process for managing the types of data they can access. Or, if you prefer, the same process always you to delete the app entirely.

Step 1:

Step 2:

Step 3:

Step 4:

Step 5:

Step 6:

Step 7:

Step 8:

Step 9:

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During Obama’s first term, the FBI was presented with evidence that Russia was providing assistance to Iran’s nuclear program, according to former undercover informant William Douglas Campbell. 

Campbell – who worked for the CIA for decades before his work for the FBI, tells The Hill that he gathered evidence of Russia intercepting nonpublic copies of international inspection reports concerning Tehran’s nuclear program – sending equipment, advice and materials to one of Iran’s several nuclear facilities. 

Campbell said Russian nuclear executives were extremely concerned that Moscow’s ongoing assistance to Iran might boomerang on them just as they were winning billions of dollars in new nuclear fuel contracts inside the United States. –The Hill

“The people I was working with had been briefed by Moscow to keep a very low profile regarding Moscow’s work with Tehran,” said Campbell. “Moscow was supplying equipment, nuclear equipment, nuclear services to Iran. And Moscow, specifically the leadership in Moscow, were concerned that it would offset the strategy they had here in the United States if the United States understood the close relationship between Moscow and Tehran.” 

Notes of Campbell’s FBI debriefings show he reported in 2010 that a Russian nuclear executive was using “the same kind of payment network” to move funds between Russia and Iran as was used to launder kickbacks between Moscow and Americans.

Campbell worked from 2008 to 2014 as an undercover informant inside Rosatom, Russia’s state-controlled nuclear giant, while posing as a consultant. He helped the FBI put several Russian and U.S. executives in prison for a bribery, kickback, money laundering and extortion scheme.  –The Hill

“Ask your politics”

When Campbell asked the FBI why all of the illegal schemes he uncovered weren’t being prosecuted, he was explicitly told it was political: 

“I remember one response I got from an agent when I asked how it was possible CFIUS would approve the Uranium One sale when the FBI could prove Rosatom was engaged in criminal conduct.  His answer: ‘Ask your politics,’ ” Campbell said.  

In other words – Obama’s “scandal free” administration approved the Uranium One deal and spearheaded the Iran Nuclear Deal after the FBI, headed at the time by Robert Mueller knew, according to Campbell, that: 

• Russian nuclear executives routed millions in bribe money to a Clinton charity as part of a “uranium dominance strategy.”
• The Clinton Foundation received $145 million in donations from parties connected to Uranium One – in particular, mining executive and close Clinton pal Frank Giustra.
• Moscow had compromised an American uranium trucking firm, Transport Logistics International (TLI) in violation of the Foreign Corrupt Practices Act – which bribed a Russian nuclear official in exchange for a contract transport Russian-mined U.S. uranium, including “yellowcake” uranium secured in the Uranium One deal.
• A Russian nuclear executive connected to the Uranium One deal engaged in a money laundering and bribery scheme with a United States trucking company, DAHER-TLI. 

Campbell said he became concerned the Obama administration was granting concessions to the Russian nuclear industry in 2010 and 2011 — paving the way for Moscow to buy large U.S. uranium assets and to secure billions in nuclear fuel contracts — even as he reported evidence of Moscow’s help to Iran.

“I got no feedback. They took the reports and the reports, I assume, went to specific people assigned to analyze the reports and that was the last I heard of it,” he said.

In 2012, FBI agents asked Campbell to press a top Russian nuclear executive about the Iran assistance, providing a list of detailed questions. The Russians became suspicious about Campbell’s inquiries and fired him from his consulting job, he said

“It raised a red flag almost immediately and within a matter of weeks thank God I was out of harm’s way,” he said. –The Hill

***

Following Campbell’s undercover work, the FBI rewarded him in 2016 with a check for $51,000 at an awards banquet in Chantilly, VA – however after details of Campbell’s undercover work for the FBI first emerged in an October 2017 report by The Hill – which did not divulge his name, Michael Isikoff of Yahoo News and Joel Schectman of Reuters published articles smearing Campbell, saying he was “so unreliable that prosecutors dropped him as a witness” in a case unrelated to his undercover work – while two “senior officials” within the Justice Department fed Congressional investigators the same thing during a December 15 briefing. 

Both statements were lies, as the case was related to Campbell’s undercover work, and he was dropped as a witness after the Baltimore U.S. Attorney’s office botched their case, which Campbell’s testimony would have weakened.

As part of the smear, Campbell’s name was also divulged in a public filing by the DOJ, “making him unemployable in the industry and leaving him to survive on Social Security” after decades of loyal service to both the CIA and the FBI. 

Campbell testified to Congressional investigators in February after an “iron-clad” gag order was lifted. 

Campbell’s lawyer Victoria Toensing, a former Reagan Justice Department official and former Chief Counsel to the Senate Intelligence Committee, fired off a letter to Attorney General Jeff Sessions on Tuesday demanding an investigation into Campbell’s character assassination – CC’ing DOJ Inspector General Michael Horowitz, along with several Congressional Investigators and others involved in the matter. 

The letter reads: 

“We write on behalf of our client, William Douglas Campbell, to request an investigation of disclosures by anonymous “federal officials” to the media and of Congressional briefings by “senior officials” of the Justice Department. The former provided false information about Mr. Campbell to the media. The latter provided false information about Mr. Campbell to Senate and House committees.”

 

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A week after the  first pedestrian death caused by an autonomous vehicle, AP reports that Arizona’s Governor has suspended Uber’s license to test self-driving cars on public roads in the state.

AP reports that Arizona Gov. Doug Ducey told the company in a letter Monday that video footage of the crash raised safety concerns.

He called the crash “an unquestionable failure” to comply with safety expectations.

The move comes days after The New York Times reported that the company’s own documents showed the testing program was rife with issues. The documents showed trouble with driving through construction zones and requiring far more human intervention than competing companies.

Experts have told The Associated Press that the company’s technology should have detected the pedestrian in time to avoid the crash.

This ban comes hours after Amnon Shashua, the co-founder of Israeli start-up Mobileye, said on Monday its computer vision system would have detected the pedestrian who was killed in Arizona by a self-driving Uber vehicle, and called for a concerted move to validate the safety of autonomous vehicles.

In a blog post, Shashua also criticized “new entrants” in the self-driving field that have not gone through the years of development necessary to ensure safety in the vehicles.

Now Is the Time for Substantive Conversations about Safety for Autonomous Vehicles

Society expects autonomous vehicles to be held to a higher standard than human drivers. Following the tragic death of Elaine Herzberg after being hit last week by a self-driving Uber car operating in autonomous mode in Arizona, it feels like the right moment to make a few observations around the meaning of safety with respect to sensing and decision-making.

First, the challenge of interpreting sensor information. The video released by the police seems to demonstrate that even the most basic building block of an autonomous vehicle system, the ability to detect and classify objects, is a challenging task. Yet this capability is at the core of today’s advanced driver assistance systems (ADAS), which include features such as automatic emergency braking (AEB) and lane keeping support. It is the high-accuracy sensing systems inside ADAS that are saving lives today, proven over billions of miles driven. It is this same technology that is required, before tackling even tougher challenges, as a foundational element of fully autonomous vehicles of the future.

To demonstrate the power and sophistication of today’s ADAS technology, we ran our software on a video feed coming from a TV monitor running the police video of the incident. Despite the suboptimal conditions, where much of the high dynamic range data that would be present in the actual scene was likely lost, clear detection was achieved approximately one second before impact. The images below show three snapshots with bounding box detections on the bicycle and Ms. Herzberg. The detections come from two separate sources: pattern recognition, which generates the bounding boxes, and a “free-space” detection module, which generates the horizontal graph where the red color section indicates a “road user” is present above the line. A third module separates objects from the roadway using structure from motion – in technical terms: “plane + parallax.” This validates the 3D presence of the detected object that had a low confidence as depicted by “fcvValid: Low,” which is displayed in the upper left side of the screen. This low confidence occurred because of the missing information normally available in a production vehicle and the low-quality imaging setup from taking a video of a video from a dash-cam that was subjected to some unknown downsampling.

Images from a video feed watching a TV monitor showing the clip released by the police. The overlaid graphics show the Mobileye ADAS system response. The green and white bounding boxes are outputs from the bicycle and pedestrian detection modules.  The horizontal graph shows the boundary between the roadway and physical obstacles, which we call “free-space”.

The software being used for this experiment is the same as included in today’s ADAS-equipped vehicles, which have been proven over billions of miles in the hands of consumers.

Recent developments in artificial intelligence, like deep neural networks, have led many to believe that it is now easy to develop a highly accurate object detection system and that the decade-plus experience of incumbent computer vision experts should be discounted.

This dynamic has led to many new entrants in the field. While these techniques are helpful, the legacy of identifying and closing hundreds of corner cases, annotating data sets of tens of millions of miles, and going through challenging preproduction validation tests on dozens of production ADAS programs, cannot be skipped. Experience counts, particularly in safety-critical areas.

The second observation is about transparency. Everyone says that “safety is our most important consideration,” but we believe that to gain public trust, we must be more transparent about the meaning of this statement. As I stated in October, when Mobileye released the formal model of Responsible Sensitive Safety (RSS), decision-making must comply with the common sense of human judgement. We laid out a mathematical formalism of common sense notions such as “dangerous situation” and “proper response” and built a system to mathematically guarantee compliance to these definitions.

The third observation is about redundancy. True redundancy of the perception system must rely on independent sources of information: camera, radar and LIDAR. Fusing them together is good for comfort of driving but is bad for safety. At Mobileye, to really show that we obtain true redundancy, we build a separate end-to-end camera-only system and a separate LIDAR and radar-only system.

More incidents like the one last week could do further harm to already fragile consumer trust and spur reactive regulation that could stifle this important work. As I stated during the introduction of RSS, I firmly believe the time to have a meaningful discussion on a safety validation framework for fully autonomous vehicles is now. We invite automakers, technology companies in the field, regulators and other interested parties to convene so we can solve these important issues together.

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Earlier this month, John Mauldin hosted the Strategic Investment Conference 2018, a three-day investor conference with 20 financial experts discussing everything from the global economic outlook for the next 12-months, along with trading strategies to overcome significant geopolitical, economic, and technological risks.

One panel was hosted by Karen Harris, Managing Director of Bain & Company’s Macro Trends Group, who presented a fascinating  keynote tilted: “Labor 2030: The Collision of Demographics, Automation, and Inequality.”

According to Mauldin Economics, Harris addressed roughly 700 investors who eagerly waited for her speech. Harris started off by saying, “the combination of a demographically shrinking workforce plus increasingly cost-effective automation will aggravate inequality, constrain demand, and put a cap on economic growth.”

She also warned, “this will have all sorts of unpleasant effects in the next decade.”

Similar to  Chris Hamilton via the Econimica blog, Harris indicates there is a significant and ominous shift currently underway in the American economy — originating from the 1980s/1990s and forced upon by a  “supply-constrained world to a demand-constrained one.” The primary drivers of the shift are debt, demographics, and disruption (or automation).

“Automation’s impact will be highly unequal. At least initially, high-wage workers will reap most of the gains and low-wage workers pay most of the cost. This is not beneficial to social order, obviously, but in the end, it’s not helpful even to the businesses that automate. Someone has to buy the goods the robots build and wealthy people have a lower propensity to spend. The results will be “demand-constrained growth.” This isn’t necessarily a contraction, but it will likely cap future GDP growth potential”

About 13-minutes into the keynote, Harris elaborated on “technology’s impact on demographics, i.e. helping people live longer.” She does not foresee lifespans dramatically increasing to reverse or cushion the deceleration in America’s lifespan growth.

Bain believes the collision of demographics, automation, and inequality has only just begun — and it will get much worse for the American worker. She dubbed the inflection point the “Wile E. Coyote” moment…

Harris says rising inequality has only just begun. It will get much worse and not just in the US. Many won’t notice initially because rising productivity will mask some of the job losses, but eventually, job losses will overwhelm productivity. She called this the “Wile E. Coyote” moment. Hard to pinpoint, but probably coming in the next decade.

Now is no time to follow market momentum, Harris says. It is a massive boom akin to tech and housing combined and the reversal will be tough.

Another implication is consumer spending. Baby Boomer spending growth will begin declining in the 2020s anyway. Add in the growing inequality with up to 25% of the workforce displaced by automation, and middle-class markets seem likely to erode. Investors and businesses should be asking, “Who will be my customers a decade from now?”

Here is the actual report from Harris and her team with excerpted highlights below: 

Figure 3: US companies could invest nearly $8 trillion in automation technologies by 2030.

Figure 4: US service sector automation could displace labor two to three times more rapidly than previous transformations.

The report paints a bearish long-term outlook for the United States: 

• Be wary of following market momentum—volatility will increase. The crosscurrents of multiple macroeconomic forces will ebb and flow at different times, making it dangerous to assume that signals indicate stable opportunities. Trends that had longer trajectories up until now, such as falling interest rates or even growth itself, may reverse course far more rapidly than in past decades. Companies can prepare for such shifts by making resiliency a high strategic priority and actively managing and monitoring macro risks.
• Middle-class markets are likely to erode. Many consumer-facing businesses design and market goods based on a three-tier household model, including a small upper-income tier, a small lower-income tier and a broad middle-income tier. Pressure on the middle class may favor a primarily two-tier structure, with upper-income households representing roughly 20% and lower-income households making up the remaining 80%. This change would trigger a dramatic shift in the way that companies segment goods and services markets within and across these tiers.
• Expect an interest rate speed bump. Interest rates are likely to rebound upward (potentially rapidly) in the next decade before dropping back toward historical lows, making capital management for businesses and capital preservation for investors more challenging. Since the 1950s, interest rates have tended to rise or fall gradually with patterns in one direction or the other, lasting decades. An environment of volatile interest rates would expose companies and investors to a greater risk of being caught with exposures pointing in the wrong direction.
• Automation could fuel a 10- to 15-year boom followed by a bust. The next wave of automation investment will create many opportunities but will grow increasingly perilous as it builds momentum. Companies may feel competitive pressure to invest in automation technologies, similar to the way they felt compelled to create global supply chains in the 1990s and 2000s. But to avoid being caught on the wrong side of the investment cycle, businesses and investors will need to pay greater attention to monitoring their risk exposure as the investment cycle progresses.
• Highly skilled, high-income labor will grow increasingly scarce. The pace at which displaced workers retrain and migrate toward higher-skilled jobs will likely be too slow to alleviate shortages. The challenge for companies will be attracting, growing and retaining highly skilled talent and maximizing worker’s productivity by rethinking how their businesses are structured.
• Baby boomer spending growth will peak in the 2020s before tapering.Compared with previous generations, baby boomers will extend the period of high-income earning and spending by about 10 years. The sheer size of this generation means there are considerable market opportunities for most goods and services, including big-ticket items such as housing and transportation. But growth based on this demographic shift will become more concentrated among the top 20% of households.
• More government in more places is likely. Faced with rising inequality, governments are likely to become more interventionist, using higher taxes and regulation to manage market imbalances. Governments may expand their role in the marketplace, similar to what was seen in the West between the end of World War II and the early 1980s, by shifting resources as well as becoming a direct buyer of goods and services.
• Intergenerational conflicts will potentially rise, drawing in businesses. As retirees and the working-age population battle for resources, businesses may become indirectly involved. Businesses, management teams and even shareholders may add their voices to the conversation about government transfers as they grapple with existing pension obligations, the scarcity of highly skilled workers, social pressure to address job losses and declining incomes among mid- to low-skilled workers.

Figure 8: Baby boomers powered worldwide labor force growth in the 1970s and 1980s, but this is slowing…

Figure 9: Despite longer work spans, the relative size of the workforce will shrink to less than one worker per dependent by 2030.

Figure 10: US labor force growth will remain low for the foreseeable future. 

Figure 12: Workers delaying retirement will not fill labor force gap to maintain historical GDP growth.

Peak America: The report indicates the collision of demographics, automation, and inequality poses a serious threat to the financial system: 

For capital markets, the increased spending by an aging population could spell trouble. As people retire, they will be liquidating savings en masse. Financial savings are only backed by the real output potential of the economy, so the practical consequence for capital markets is likely to be too much capital drawdown chasing too little real capacity. Until now, the dramatic inflation of financial assets vs. the size of the real economy has masked the coming challenge posed by insufficient real growth to meet future obligations (see the Bain report A World Awash in Money).

But as baby boomers begin using assets and pensions, the large-scale liquidation of financial assets could lead to a drop in their value. One risk here is that guaranteed private or government pensions that similarly relied on financial asset inflation to meet future obligations will become highly strained or could break, especially at subnational levels of government.

Countries will have limited policy options to alter demographics at a national level and increase output: These may include increasing the supply of labor through increased immigration, incentives for more female workforce participation and improving workers’ skills to raise their productivity. But given the breadth and scale of the demographic imbalances, these levers are unlikely to meaningfully offset declining labor force growth at the global level.

Figure 18: Productivity gains from automation will vary broadly across industries by about 10% to 55%.

Figure 20: Advanced economies using automation to close the cost gap with developing economies.

Figure 21: Next-generation robots are becoming cost competitive against developing-economy workers.

Figure 22: Automation could eliminate 40 million jobs in the US and depress wage growth.

Figure 23: Many industries could use automation technology to reduce operating costs by 10% to 15%.

Figure 24: In retail distribution, automation will crease new job functions but fewer full-time jobs.

Figure 25: In healthcare, automation will eliminate full-time jobs and change job functions.

Figure 26: Automation will affect 80% of workers through wage suppression and job loss.

Figure 27: US service sector automation could displace labor two to three times more rapidly than previous transformations. 

Figure 35: Automation may create worse outcomes for lower-income workers.

Figure 36: Labor’s share of GDP is already declining; increased automation may accelerate this trend.

According to Bain Capital and Karen Harris’s eye-opening report, a historic shift for America has begun. The trend is driven by debt, demographics, and automation, which will only accelerate into the 2020s. The magnitude of the workforce shift is expected to match that of the automation of agriculture from 1900 to 1940. The automation of farming transformed America’s economy and severely disrupted labor markets, ultimately climaxing into the Great Depression and subsequent world war.

From the gloomy future laid out by Bain Capital and Harris, one can expect a similar outcome this time as well.

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Authored by Jeff Thomas via InternationalMan.com,

The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.

—Ernest Hemingway

Military spending is the second largest item in the US federal budget after Social Security. It has a habit of increasing significantly each year, and the proposed 2019 defense budget is $886 billion (roughly double what it was in 2003).

US military spending exceeds the total of the next ten largest countries combined. Although the US government acknowledges 682 military bases in 63 countries, that number may be over 1,000 (if all military installations are included), in 156 countries. Total military personnel is estimated at over 1.4 million.

The reader could be forgiven if he felt that a US military base was rather unnecessary in, say, Djibouti or the Bahamas, yet the US Congress will not allow the closure of any military bases. (The Bi-partisan Budget Act of 2013 blocked future military base closings under the argument that they’re all essential for “national security.”) And Congress has a vested interest in keeping all bases open and consuming as much in tax dollars as possible (more on that later).

Of course, those bases need to be kept well-stocked with small arms, tanks, missiles and aircraft. Yet, in spite of the admittedly incredible number of US military bases across the globe, the additional stockpile of weaponry is so great that the government has difficulty finding places to put it all.

One storage location is pictured in the photo above – Davis-Monthan Air Force Base in Tucson, Arizona. In spite of the size of the photo, it shows only a portion of the aircraft located there. (And bear in mind, such aircraft often cost over $100 million each.)

If asked, the military states that, although these aircraft are in dead storage and many have never seen any use whatever, they might possibly be called up for service, “if needed.” Of course, if they’re needed, they’re unlikely to be of use if located in Arizona. And, in addition, they may not be useful for warfare, as war technology has moved on since the days when such aircraft designs were suitable.

It’s been said that generals are forever fighting the last war, and this is certainly true. Even a layman can observe that such conventional aircraft will never see use, as they serve no purpose in modern warfare.

And yet, these storehouses are being dramatically added to every year.

This year, production will be increased for the F-35 and F/A-18 aircraft. To get an idea of the cost of such expansion programmes, the F-35 Joint Strike aircraft alone will cost $400 billion for 2,457 planes. However, most of this cost will be for development and testing, not the planes themselves.

To save you the arithmetic, that’s about $162 million per plane. (I’m guessing that Henry Ford might have been able to produce them a bit more cheaply. It’s difficult to imagine what they could possibly be made out of to justify their extraordinary price tag.)

But, even though a staggering amount of money is spent on such aircraft, only to then send them to storage facilities at some point, why not, at the very least, sell off the surplus cheaply or scrap them and close down the costly bases that warehouse them?

Well there’s a bit of a snag there. If they were to be scrapped, it would be necessary to admit that they weren’t really necessary. And if they weren’t necessary, why were they purchased?

It may well be that the answer lies in the fact that the military industrial complex is a major political contributor, paying heavily into the campaign funds of both political parties.

It’s probably safe to say that, in doing so, they’re likely to expect something in return, and of course, that’s just what they get. As stated above, the “defense” budget is far beyond what it would cost to defend the US, and ridiculously so.

However, as far as the military industrial complex is concerned, the ideal situation might be for the US to enter into a policy of perpetual warfare with vaguely-stated military goals, and to do so on many fronts globally. If Congress were to approve a budget that would allow for that, the amount of kickback to the military industrial complex would not only be maximized, but it would be ongoing, from one year to the next.

So, is that what has occurred?

Well, if we look back at say, World War II, the most costly war in history, we see a war that was fought on three continents and cost the lives of between fifty and eighty million people, yet it was concluded a mere four years after the US joined.

By comparison, the undeclared war with Afghanistan has been a minor one, costing roughly 150,000 lives. Again, based upon arithmetic, as compared to World War II, it should theoretically have taken just over two months to conclude, yet to date, it’s been ongoing for seventeen years, and its daily cost has far exceeded that of a world war.

So, are we to conclude that the US military has become so inept that it can’t fight a war and win, no matter how much firepower they have and no matter how much time it takes?

If this is not the case, then there’s only one other conclusion to draw. (As Sherlock Holmes often said, “Once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth.”)

In this case, what remains is that winning the war is not the objective and, in fact, never was the objective. The objective would be to consciously create perpetual warfare; to extract billions in tax dollars each year from the electorate, in order to pass the revenue on to the military industrial complex in the form of armaments contracts. Whether those armaments are needed, or even useful, would be of minimal importance.

In recent years, the US military has gone far beyond its original concept of “defense.” It’s invaded more countries than ever before in its history, often with no direct provocation whatever, on the basis of “making the world safe for democracy.” (It should be borne in mind that invading a country, largely destroying it, then installing a puppet government is not exactly “democracy.”) In addition, these have not been actual “wars,” as, under US law, only Congress can declare war and has not done so since 1942.

In addition, the “enemy” in each case has been vague indeed. The US is not at war with any country specifically, but with “terrorism,” a non-specific enemy, one that’s even more vague than George Orwell described when writing 1984.

If nothing succeeds like success, it’s also true that nothing exceeds like excess. If this thought is troubling now, it will be even more troubling when the US makes good on its threat to attack North Korea, a small country next door to China, or to invade Iran, an ally of both China and Russia.

When the fur really starts to fly, it will be highly doubtful if the American taxpayer is able to pony up the further cost of a true world war, which would be far beyond what they’re shouldering at present.

And, since the loser in a war is almost always the country that runs out of money first, and the US is for all purposes broke, the outcome of such a war would not be in favour of the US.

*  * *

You don’t have to sink with the US… There are practical steps you should take to prepare—before America makes a dangerous military move. Get the details straight from Jeff in our guide to Surviving and Thriving During an Economic Collapse.

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While the resurgence of human trafficking in war-torn Libya in recent years has occupied the headlines, trafficking in the UK has also climbed to an all-time high, according to the National Crime Agency.

Statistics released by the NCA show the number of potential victims of slavery has increased by 35% to 5,145 since 2016 – the highest since records began in 2009. And it’s likely that number will only continue to climb, per RT.

The NCA said most victims are being used for sex or as drug mules by “county lines” groups, which use vulnerable children as couriers to transfer drugs from the city to rural areas.

British nationals comprised the largest group, followed by people from Albania and Vietnam. UK children accounted for 819 referrals, while 777 were Albanians, and 739 were Vietnamese.

Liam Vernon, a senior manager in the NCA’s modern slavery and human trafficking unit, said the figure is “shocking.” “The reality is that there isn’t a region in the UK that isn’t affected.” “The number is shocking and our assessment is that this is an underreported crime.”

Nearly half of the referrals were linked to labor exploitation, while other cases were connected to sexual exploitation (1,744) and domestic servitude (488). The NCA said the increase in referrals was due to a “greater awareness” of the problem, but warned that figures “almost certainly represent an underestimate of the true scale” of the problem in the UK. Will Kerr, director of the NCA, said the rising phenomenon was a “particular concern.”

“We are now dealing with an evolving threat,” he said.

“The criminals involved in these types of exploitation are going into online spaces, particularly adult services website, to enable their criminality.”

Other common countries of origin include China, Nigeria, Romania, Sudan, Eritrea, India, Poland and Pakistan; but 116 different nationalities are known to have been affected.

Victoria Atkins, Home Office minister for crime, safeguarding and vulnerability, said the figures showed that more potential victims were being “identified and protected” because of an “improved understanding of modern slavery.”

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Authored by Mitchell Gunter via Campus Reform,

A statue of Thomas Jefferson has raised the ire of student activists at Hofstra University, who are demanding that administrators remove his visage from campus.

JaLoni Amor, a Hofstra student and Black Lives Matter activist, released a petition calling for the statue’s removal on March 17, proclaiming that Jefferson has been embraced as an “icon” by “white supremacist and neo-nazi organizations” like the Ku Klux Klan.

“The Sondra and David S. Mack Student Center is one of the central points for on-campus life and student activities,” the petition reads.

“It is unfortunate then that a bronze sculpture of a 71-year-old Thomas Jefferson, gifted to the university by Hofstra Trustee David Mack, is right in front of the Student Center.”

“Jefferson has been embraced as an icon by white supremacist and neo-nazi organizations such as the Ku Klux Klan,” the petition continues, calling attention to Jefferson’s past as a slave owner who committed rape.

Shortly after, Amor created a Facebook event for an upcoming protest titled, “Jefferson Has Gotta Go!” slated for March 30. More than ten organizations are listed on the event’s flyer, including the Democrats of Hofstra University, Queer and Trans People of Color Coalition, The Gender Identity Federation, and Young Democratic Socialists of Hofstra.

“At noon on Friday, March 30, 2018 students will gather in front of the statue of Thomas Jefferson located in front of the Student Center at Hofstra University to protest its presence on this campus and the administration’s refusal to remove it!!!” the event’s description states.

Amor took to the page’s discussion section to elaborate on the event’s purpose.

“I drafted this petition to call on Hofstra University to F I N A L L Y remove the statue of Thomas Jefferson from in front of the Student Center,” Amor wrote, asserting that “Jefferson owned more than 600 slaves in his life time” and “preyed upon many of these slaves.”

Amor also addressed her fellow protesters, writing, “WHITE ALLIES – Please understand that this is a protest against white supremacy and that you as white people – even though you’re allies – benefit from white supremacy!” and “PROTEST. Do not just come and take selfies for your Instagram feed or SO HELP ME GOD.”

“The leading black organizers will wear handcuffs around their wrists to honor our ancestors who were enslaved by Europeans and forced to build this country. If you want to volunteer to wear handcuffs, COMMENT!” Amor continued, stating, “HOPEFULLY, nothing will get physical. There’s so many of us that anyone who tries will ….. lose ….. so I don’t anticipate anyone trying!”

Not all students were supportive of the protest, however.

“Not to bring problems, but I’d like to point out that as you are making the protest about your right to freedom of speech, don’t forget that people like Jefferson gave you that right,” Hofstra student Conor Dawson wrote in response to Amor’s post.

“Jefferson was one of the earliest anti-slavery advocates in the 18/19th century. He even proposed abolition and banning it outright in congress. Just do a little bit of basic reading on the subject and youll [sic] see that he stood for a LOT more than just that,” Alex McHale added.

“To add to the criticism here, Jefferson was not involved in eugenics. That movement happened in the early 20th century, long after Jefferson. Also, there is no evidence that he slept with any slaves besides Sally Hemings. I’d say you don’t know as much about Jefferson as you think,” Ned Borninski concluded.

Campus Reform also reached out to JaLoni Amor to learn more about the protest. 

“The sculpture in front of the Student Center has always bothered me,” Amor explained, referencing Jefferson’s past. “Perhaps it would be traumatizing if I hadn’t gotten used to the routine micro and macroaggressions I’ve dealt with while attending Hofstra University.”

“There are so many more appropriate places for this sculpture,” Amor continued, suggesting museums and archives. “This movement is not about editing history or erasing history. It’s honestly about preserving history, all of the history.”

Amor elaborated that the act of removing the statue would force students to confront the troubling aspects of Jefferson’s life that the protesters find objectionable.

“I think so many students want this statue to stay because for many of them, they were thought of when this nation was founded and remain the dominant, privileged demographic that is always thought of and catered to today,” Amor proclaimed.

“I want to force them to look at their privilege and understand what their race means.”

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