Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
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Topics today include:
Woman Who Accused Emmett Till of Harassment Says She Fabricated the Story
Essay about Ills of 'Printing Money' is Unconscionably Bad
The Rise of Finance and the Fall of American Business
Global Criticism of Trump
Trump and White House Team Stand Firm on Ban
Dems Plot Legislative Overturn of Immigration Ban
University of Michigan Issues Statement of Noncompliance with Order for Student Immigration Status
Scott Adams (Dilbert Creator) Explains the Psychology of Pro-Trump and Anti-Trump
Scott Adams Says One of Two Positions on Trump Will Soon be Proven Wrong
Either Wall Street or Economists will Soon be Proven Wrong on Trumponomics
Trump's Battle with the Pope the Happened One Year Ago
Trump's Public relations Problem (Cartoon)
London Just Set a New Modern Air Pollution Record
Some Days Syrian Refugees Wish They were 'Back Under Shelling'
How Donald Trump Can Work with Russia and Not Give Away the House
Former Mexican President Vincente Fox is a Trump Twitter Troll
Trump Apparel has a Conflict of Interest
Articles about events, conflicts and disease around the world
Global Criticism of Trump Ban Builds From Germany to Google (Bloomberg) Global opposition to U.S. President Donald Trump intensified on Sunday, as world leaders including Canadian Prime Minister Justin Trudeau and German Chancellor Angela Merkel denounced his decision to limit entry from seven predominantly Muslim countries in the name of fighting terrorism. Econintersect: Our opinion? If the war on terror is a battle for hearts and minds, the U.S. will clearly lose following this path. If hearts and minds don't matter then just hunker down and wait. We suspect hearts and minds are ultimately what matter. See also CEOs Speak Out Against Immigration Ban.
Trump stands firm over travel ban (BBC News) The Trump administration is standing firm over its ban on refugees from seven countries despite court rulings and mass protests against the move. Mr Trump tweeted the US needed "extreme vetting, NOW". His chief of staff said only 109 people, out of 325,000 travelling, had been detained. A number of judges ruled on the issue - one federal judge temporarily halted the deportation of visa holders. There has been condemnation from countries around the world.
While some major universities are advising their students that they are studying Trump's Muslim ban, the University of Michigan released a statement on Saturday that flatly refused to release the immigration status of their students. The Maize and Blue isn't playing along with Trump's Muslim prejudice.
The Persuasion Filter and Immigration (Scott Adams Blog) Hat tip to Steve Keen. Trump supporter, the creator of the Dilbert cartoon, Scott Adams, sees Americans divided into two extreme groups. (Presumably there is a third group in between, we could call them fence sitters or undecideds.) On what he calls the left are those that see Trump as "Hitler-like"; on what he calls the right are those who see the new president as "an effective business person with good intentions". Adams says: "They can’t both be right." Scott argues:
"... human brains did not evolve to show us reality. We aren’t that smart. Instead, our brains create little movies in our heads, and yours can be completely different from mine."
Scott says that Trump supporters see the president as establishing an extreme starting position so that he can negotiate back to the middle. Trump opponents see the current actions as indications of things to come. Scott is in the first group but says we will learn if he is right or wrong fairly soon:
If Trump is a Master Persuader, as I have been telling you for over a year, he just solved his biggest problem with immigration and you didn’t notice. The biggest problem is that his supporters on the right want more immigration control than he can (or should) deliver while his many critics on the left want far less. Normally when you negotiate there is only one party on the other side. But in this case, Trump is negotiating two extremes in two different directions. It’s the toughest possible situation. Best case scenario is that 40% of the country want you dead when it’s all over. Not good.
So what does a President Trump do when he is in an impossible situation?
According to the Hitler Filter, he does more Hitler stuff, such as being more extreme than anyone expected with his recent immigration declarations. That filter accurately predicted that he would be “worse” once elected. Sure enough, his temporary immigration ban is more extreme than most people expected. If things never get worse from this point on, we would have to question the Hitler Filter. But if things get worse still, the Hitler Filter is looking good.
Trumponomics: Wall Street or academic economists will be wrong (Australian Financial Review) One group of pundits is going to be horribly wrong on Trumponomics. Either bullish investors driving stocks to record highs, or many of America's eminent academic economists who are overwhelming bearish on Trump's policies will have egg on their face when the history books are written. Justin Wolfers, an Australian economics professor at the University of Michigan, says many of his fellow academics who attended a recent conference in Chicago believe there is an "absurd level of optimism in the markets" about the new President. On Wall Street, traders are jubilant about Trump's pro-business policies of lower taxes, swingeing cuts to regulation, infrastructure investment and higher defence spending.
Donald Trump issued a blistering response to Pope Francis on Thursday, saying it is "disgraceful" for the Catholic leader to question his faith and calling the pontiff "a pawn" for the Mexican government.
"No leader, especially a religious leader, should have the right to question another man's religion or faith," Trump said at a rally in Kiawah Island, South Carolina. A press release followed shortly after he read the statement at the podium.
London Just Set a New Modern Pollution Record (Bloomberg) At times this week the British capital’s air quality has been worse than Beijing. The city’s poor air quality set a modern record during this week’s spate of pollution that occurred when cold, windless weather trapped emissions over the capital. More than 20 sites recorded levels that hit the limit 10 on an index maintained by King’s College London from Jan. 17 to Jan. 24, the most since the index was introduced in 2012, said Andrew Grieve, an analyst at the college.
How Donald Trump Can Work with Russia and Not Give Away the House (Strategic Culture) Hat tip to Doomstead Diner. These authors argue that Vladimir Putin is straightforward in seeking to reestablish Russia as a major force in global affairs, and to win recognition that the countries of the former USSR are a Russian sphere of influence. He appeals to Trump’s deal-making style by hinting at a grand bargain to reshape the international political and security environment. But President Trump will need to understand the complexity of this "straightforward" situation:
We are not back in the Cold War, and containment is not the strategy to confront Russia today. Improved communications are necessary with Russia, including with the military, to reduce the risks of unintended conflict and provide better understanding of mutual interests and areas of difference. At the same time, our democratic values and principles that are now being challenged must be reaffirmed; these are basic to American greatness. Like it or not, the United States is the cornerstone of the liberal-democratic international order. It is often said that being responsible makes one act responsibly. Let us hope that happens with Trump. Indeed, it is an axiom of statecraft that a leader is entitled to his own policy, but not his own facts.
Other Scientific, Health, Political, Economics, and Business Items of Note - plus Miscellanea
Woman at center of Emmett Till case tells author she fabricated testimony (The Guardian) It was the lynching that outraged African Americans, spurred the civil rights movement and etched the victim’s name in history: Emmett Till. The 14-year-old Chicagoan was visiting relatives in the cotton country of the Mississippi delta on 24 August 1955 when he allegedly wolf-whistled at a white woman. Three days later his body was found in the Tallahatchie river. Till had a bullet hole in the head, an eye gouged out and other wounds. The murderers had wrapped barbed wire around his neck and weighted him down with a cotton gin fan. A few weeks after the murder, the then 21-year-old testified in court that Till had grabbed and verbally harassed her in a grocery store. “I was just scared to death,” she said. The all-white jury cleared her husband Roy Bryant and his half-brother JW Milam of the crime. They later publicly admitted their guilt, saying they wanted to warn other blacks. Carolyn Bryant disappeared from public view. Now, 62 years later, it has emerged that she fabricated her testimony about Till making physical and verbal advances. Bryant, who is still living at an undisclosed location, told Timothy Tyson, the author of a new book, The Blood of Emmet Till:
“That part’s not true. Nothing that boy did could ever justify what happened to him.”
Printing more money isn’t the answer to all economic ills (The Conversation) Hat tip to Dirk Ehnts who offered this with "no comment". The author, an economics professor from Australia named Richard Holden. Econintersect: He is correct in saying that the concern of governments printing more money CAN cause inflation. He is wrong in stating that it WILL cause more inflation. This is one of the sorriest essays we have ever seen penned by an economist. This essay should be an embarrassment to the institutions where he has been associated, as a teacher or a student, including Harvard, MIT and the Unversity of Chicago. He has obviously not studied in any detail what he is criticizing (or has chosen not remember any details). Here is a list of some of the errors we found in this piece:
"[I]t also begs an obvious question: if it is so easy to fix a nation’s economic ills – just run the printing presses round the clock – then why doesn’t everyone do it?" The reason is that recognizing the actual accounting breaks the power of the banking system to control governments.
"If the government prints money and doesn’t back that by issuing bonds then there is inflation." He offers Zimbabwe in 2008 as an example of hyperinflation. This is hardly a credible example of a globally recognized sovereign currency. There is no evidence to support Holden's assertion in such systems where debt is denominated in a nation's own currency for a major country. NONE!
"...there is only a finite amount of real economic resources that can be extracted through seigniorage (the difference between the face value of physical money and its production costs)." This is a widely stated incorrect definition. Seigniorage is correctly defined the difference between the monetary value of a currency and the independent value of the commodity from which it is made. Production cost contributes nothing to value, only what a user is willing to "pay" determines value.
"So here’s my challenge to the modern monetary theory crowd. Please state a formal, precise, economic model in which a monetary authority can extract an infinite amount of real resources through seigniorage. Or be quiet." Holden reveals his ignorance of the work of economists working in MMT. There has never been (to our knowledge) an academic who has stated what Holden charges. Instead, researchers have always identified inflation as a result if the amount of money available is not in balance with an economy's ability to produce. What MMT researchers have said is that lack of money can suppress production to levels below the output capacity. This does NOT propose infinite production of money.
"I understand that “mainstream” economists have some work to do. That’s how science moves forward. Einstein didn’t say Newton was a knucklehead, he came up with a better theory." Holden shows little understanding of physics, as well. Einstein did nothing that discredited Newton's laws of motion. Einstein found that there were regimes in the physical universe that were not observable by traditional human senses as described by Newton. The human senses remained and Newton's laws are still valid for them today.
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