Category: Economics

By The Numbers

Economics, Marxists

We’ve all marveled at the stupidity of Manhattan voters, in voting into power some Marxist asshole who is promising all sorts of free stuff in exchange for higher taxes and malevolent gouging of successful businesses and the individuals who made them or run them.

This might work if Manhattan was truly an island, i.e. well away from any mainland, where the population is in essence imprisoned on the island and can’t move out of the Marxist hellhole.  This, by the way, is how Marxist governments have traditionally been able to bend their citizens over the desk:  by forbidding them to leave or physically restricting their ability to do so.

Fortunately (for the would-be recipients of the looming Marxist economic rape in the Five Boroughs), they have a chance of saving themselves from catastrophe by simply leaving for sunnier climes (in every sense of the word), taking themselves, their businesses and their tax payments with them.

And the scale of said catastrophe?  Here’s the pitiless financial analysis:

Put simply, by any normal accounting, New York State is using federal funds to pay $21 billion to NYC. By the same standard, New York City too is presently bankrupt, in the old-fashioned sense that it cannot pay for its extravagant spending, collecting $86.8 billion in total revenue versus outlays of $119.8 billion. The $31 billion needed annually by New York to survive comes, directly or indirectly, from the federal government. That will not last.

But all this is mere prelude to the Mamdani tax-the-rich onslaught about to hit New York City. The numbers are frightening.

At the individual level, in a city of 8.5 million people and 4 million taxpayers, the top 1%, or some 40,000 individuals, account for an estimated 45% of the city’s total $17.4-billion personal income tax receipts. While the New York Post talks of 1 million potentially exiting New York, it is highly likely that at least half of high-income taxpayers will choose escape over life in Mamdani New York. So goes roughly $4 billion, from a mere 20,000 departing for greener pastures. Others are sure to follow. Seventeen point four billion dollars will be the high-water mark for New York City personal income tax revenue.

It gets markedly worse when businesses choose to exit New York, especially financial firms.

The city collects roughly $13 billion in direct taxes on businesses, but the impact of business exit would be far greater, as associated spending ripples through the economy, conservatively tying $30 billion in city tax revenue to business-driven activities. Ten major financial firms alone could reduce NYC tax revenue by $5 billion. The city is at enormous risk, made all the greater by the well understood impact of technology. At a minimum, no financial firm needs to be in New York any longer, especially when the most needed 1,000 firms are specifically targeted by Mamdani for sharply higher taxes.

Put it all together, and New York City revenues are likely to decline, permanently, by at least $10 billion due directly to Mamdani’s actions, adding to $5.5 billion in structural deficits, on top of an already slapdash concoction of sticks and glue that is New York State, made worse by implementation of devastating, and costly, Democratic Socialist Party principles, with President Trump vowing to restrict federal spending to the “bare minimum required by law.”

Read the whole thing for the full gory details.

I read somewhere that actor John Voigt has implored POTUS to somehow overturn the NYC election results, but of course Trump can’t — and shouldn’t.  Why not?

Because at some point the vacuous dreams and economic stupidity of Marxists need to explode, spectacularly, so that the people who did not learn the lessons of 1990s Detroit can have their noses rubbed in the foul dirt of utter financial bankruptcy.

And then they have to shoulder the burden of rebuilding the whole thing from the ground up, just as the Germans had to rebuild the shattered German state after 1945 — only without the lifeline of any kind of federal Marshall Plan, because New York City doesn’t deserve it.  New Yorkers have always had an unhealthy sense of their own importance and urban grandeur, and this time their collapse through stupidity and cupidity will actually be well deserved.

H.L. Mencken once defined democracy as “the theory that the common people know what they want and deserve to get it good and hard.”  Well, New Yorkers exercised their democratic rights… and now the fun begins.

Quote Of The Day

Economics, Journalist Scum, QOTD

Whiny little Commie bitch TV interviewer:  “So just bottom line, Mr. Secretary, do you acknowledge that these tariffs are a tax on American consumers?”

SecTreas Scott Bessent:  “No, I don’t.  You’re quoting Goldman Sachs… I made a good career of trading against Goldman Sachs.”

Missing The Point

Corporate Fuckery, Economics

I’m all for POTUS putting the arm on foreign manufacturers to open their factories here in Murka, because we need more industry Over Here.  So more jobs for Murkins, even in industries where our market doesn’t especially care for the actual product.  Clearly, however, something got lost in translation with the recent Hyundai cock-up in Georgia:

Federal authorities say 475 people were detained this week in what Homeland Security Investigations called the largest single-site enforcement operation in its history.

The raid took place Thursday at the HLGA battery plant site in southeast Georgia, a joint venture between Hyundai Motor Group and LG Energy Solution, as part of a months-long probe into alleged unlawful employment practices and other federal crimes.

…and this is even worse:

According to South Korea’s Foreign Minister Cho Hyun, more than 300 of the detained workers were South Korean nationals.

So in case the SouKs (and others) haven’t got the plot yet:  opening a manufacturing plant in the U.S.A. does not mean you can staff the place with a whole bunch of your own citizens not allowed to work Over Here.  You tossers.

Anyway, the illegal Koreans are immediately going to be “reshored” back in their own country instead of staying in some manky ICE detainment camp awaiting deportation.

We want the foreign factories, not the workers.  We’ve got the “worker” part covered, thank you.

And the Victory Girls have nailed it.

When Reality Bites

Eco-Crap, Economics

It’s all very well to espouse boutique nonsense like Net Zero, except that at some point reality will come and beat you over the head.  Hence situations like this one:

New York Gov. Kathy Hochul (D), Monday directed the New York Power Authority (NYPA) to develop and construct a nuclear power plant of not less than one gigawatt. The new plant was needed, Hochul said in her announcement, in order “to support a reliable and affordable electric grid, while providing the necessary zero-emission electricity to achieve a clean energy economy.” 

It was a surprising announcement for a state that closed and dismantled the Indian Point nuclear power plant only five years ago. The consideration of nuclear in the energy mix is part of a pattern seen in other blue states committed to eliminating electricity generated from fossil fuels. California has now delayed the closure of its only nuclear power plant, and Michigan is looking to restart a previously shuttered nuclear power plant. 

In all three cases, it appears that the states are coming to grips with the reality that intermittent wind and solar backed up by short-duration, expensive grid-scale batteries won’t be enough to supply the power needs of the state, especially as AI places more demands on the grid. Still clinging to the hope of a fossil fuel-free grid, these states are looking to nuclear as a more politically tenable option. 

Cue wailing and weeping from the anti-nuke brethren and watermelons in 3…2…1…

Me, I’d be quite happy if these idiots — and the people who voted them into power — broiled, froze or suffered permanent blackouts for a few years as a result of their foolishness, but perhaps I’m being too harsh.

Forgetting The Basics

Economics, Food & Drink

Many years ago, I had subscriptions to the UK’s Country Life and Country Squire  magazines, which, as their names suggest, are dedicated to that country’s rich rural heritage.  Yes, I know the mags’ main emphasis was (and still is) dedicated to the landed gentry, but the mags also contain gems, like this one from Country Squire :

We walk on concrete, but we live on bread. The modern world hums with the illusion of self-sufficiency – our smartphones deliver groceries with a tap, restaurants materialize meals on demand, and supermarkets present endless abundance as if by nature’s own hand. Yet this is a collective delusion.

The truth is simpler, starker: every society rests upon the bowed backs of farmers. They are the uncelebrated linchpin holding civilization together, performing work so fundamental we’ve forgotten to see it.

Their labor defies romanticism. Farming is not some bucolic idyll; it is mathematics written in mud and sweat. A farmer must be gambler and scientist, prophet and laborer – calculating risks against fickle weather, coaxing growth from stubborn soil, fighting entropy itself just to keep the fields productive. One missed frost, one unseen blight, and a year’s work vanishes. Meanwhile, they’re patronized by 5-days-a-week urbanites who’ve never dug a ditch, who speak of ‘sustainability’ between takeaway lattes, who’d starve in a week if the lorries stopped running.

And for what?

To watch agribusiness conglomerates and supermarket oligarchs siphon away the profits? To hear deadbeat politicians lecture them about ‘efficiency’ while folding to trade deals that undercut their livelihoods? To be treated as quaint relics in a world that venerates guff videos on TikTok?

There’s more, much more in the piece, and I urge you all to read it.

There’s unexpected humor, too.  This from Country Life:

And of course, there’s property:

…a snip, at only $120,000 a year rental.

Being Patient

Bad News, Business, Economics

Like many, I suspect, I was somewhat surprised that our GDP shrank a little during Q1, especially as the job market continues to grow (despite hundreds if not thousands of government jobs ending).  However, we have to remember that we essentially started off the year in Q1 with the last remaining month of Bidenomics, and no doubt the hangover from four years of said stupidity was one hell of a handbrake to the start of the year.

Still, I refuse to be a slave to the “Q” mindset so beloved of financial types, where every fiscal quarter has to show growth even if market conditions make it impossible.  Which, I suspect, is what happened here, for all sorts of reasons.

It’s short-term thinking like this which causes trouble in the longer term.

What we do know, however, is that large corporations are moving production back to the U.S. and away from Asia (especially from China yay) to the tune of some $5.2 trillion — but those are just planned investments, i.e. promises, which will take some time to be realized.  In addition, there are planned growths in ship-building which are almost certain to revive once-moribund areas, not to mention making us both more independent in trade and more secure militarily.  But those too are still in the planning stages.

Factories don’t just spring up overnight, in other words.

Listen:  we all knew that to reverse the tide of red ink, both in government spending and the trade deficit, we would have to experience some discomfort.  And while ICE is doing well — from all accounts, over 60,000 illegals (mostly of the career criminal persuasion) have been booted out in the past three months — but as I’ve said before, that still leaves many millions more that still need to be expelled:  millions of whom, we all know, that are sucking up public money in healthcare and education, to name but two areas of ongoing concern.

The question is:  are we on the right track?

I think so.  The moves to reduce tax burdens on the majority of the population, the DOGE-inspired slashing of government spending and the efforts to cut deadwood and make both business and government more efficient — by stopping the inherent inefficiencies of DEI policy, for one — all mean that the long-term prospects for our economy look promising.

And to a large degree, the market swings caused by the tariff business are simply due to the fact that markets hate uncertainty, because they’re slaves to short-term thinking — remember, stock prices are tracked daily.  These are very uncertain times we live in.

But we need to give the whole thing more time to develop.  We didn’t sink into quasi- (and in some cases actual) socialism in a single quarter, either.  That took decades of work by socialists like Bill Clinton, Barack Obama and their cohorts in Congress from even before then.  And we’re not going to reverse this tide in a single quarter.  Hell, it may take years.

It didn’t take that long for Javier Milei to effect massive changes in Argentina, but it should be remembered that taming an inflation rate of hundreds is considerably easier than doing the same to an inflation rate in the teens (as we experienced under Biden), let alone getting inflation into low single digits, which in today’s world is almost impossible and takes a supreme effort of will.

But although cheaper energy and the concomitant lowering of the prices of goods and services is going to make a difference, that’s not going to happen immediately because we still have to drill new holes, build new refineries and get more nuclear power generators online to replace the unreliable and fragile Net Zero-style solar- and wind-based power generators so beloved of the Eco-Nazis.  None of that can happen in a single quarter, either.

We’re doing the right thing — and by “we” I mean the Trump Administration, whom we voted into power.  We just need time to get it done, and not be swayed by short-term thinking.