Wednesday, February 20, 2019

Amazon Walking Away Was A Loss For AOC

I was not even following the developments closely. I thought it was a done deal. Past tense. And then Amazon announced its exit. I was surprised. I still have not had the time to dig into the details. I did read the NYC Mayor's op-ed on the topic. And the AOC celebratory tweet. And there is this Wharton podcast, that I read. (I did not listen)



If it was a botched deal, maybe the NY Governor, and the NYC Mayor did not sell it to the people hard enough. Or maybe Amazon made the mistake of not engaging. Or the protestors did not see the full picture. It comes across as a political victory, but an economic loss.

When I think of the Green New Deal, I see a lot of high tech entrepreneurship. Otherwise, under the current economic paradigm, the Green New Deal can look really, really hard. Pricing out dirty energy is much smoother than trying to shut down an industry. There is no shutdown valve.

Just like the original New Deal created a new middle class and a new age of prosperity, I see the Green New Deal as ushering in an Age of Abundance.

You probably don't want to come across as anti-entrepreneurship. On the other hand, maybe Amazon should not be so stand-offish when it comes to ordinary people and their elected representatives. The local community matters. The city might have gotten 25,000 jobs. But what was Long Island City going to get specifically?

I see no evidence AOC was the central figure in the protests. (Some New Yorkers will protest a-n-y-t-h-i-n-g) But she obviously was supportive, and she obviously was celebratory after the fact. If it was a political victory, it was a grand one. Hey, not everything is business.

But I do think AOC should work harder to come across as pro-entrepreneurship.


















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Monday, February 11, 2019

The Next Recession Might Force The US To Do Universal Basic Income



The next recession, which likely will hit before the next presidential election, might force the US to do a Universal Basic Income. The idea will be, every taxpayer gets a basic income (yes, the richest also do) directly from the government, no questions asked. It would likely be a direct deposit that shows up once a month.

Quantitative easing was a gift to the banks post 2008 recession. The Fed was basically printing money, lots of it, and handing it out to the banks at zero interest rates. That meets the definition of free money. Absent a real stimulus, which might have been closer to three trillion dollars, the system resorted to quantitative easing. The Fed did not need congressional approval to do that. It was Fed action. Like raising or lowering interest rates.

The interest rates are already near zero. The Fed does not have much wiggle room. And there is no Big Crisis to justify giving free money to the banks. We The People are an afterthought.

If it happens it will be interesting, because the Fed will introduce UBI (Universal Basic Income) without any presidential initiative or congressional approval. It will change the political paradigm in the country.

What do you think Paul Krugman? Will the next US recession gift us the Universal Basic Income? Is it an idea whose time has come?

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