Written by rjs, MarketWatch 666
News posted last week about economic effects related to the coronavirus 2019-nCoV (aka SARS-CoV-2), which produces COVID-19 disease, has been surveyed and some articles are summarized here. We cover the latest economic data, especially the prospects for an infrastructure bill, stimulus checks, government funding, the Fed, the latest employment data, housing market reports, mortgage delinquencies & forbearance, travel, layoffs, lockdowns, and schools, as well as infrastructure and GDP. The bulk of the news is from the U.S., with a few more articles from overseas at the end. (Picture below is morning rush hour in downtown Chicago, 20 March 2020.) News items about epidemiology and other medical news for the virus are reported in a companion article.
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Congress is shifting to a $3.5 trillion budget debate, so I’m including what I have on that. Most stories on mask and vaccine mandates are also in this package. Now that schools will be heading back soon, there’s a lot on those too.
The news:
As Fed shifts gears, shaping consensus gets trickier for Powell – In his nearly six years on the Federal Reserve’s board of governors before becoming its chair, Jerome Powell never once cast a dissenting vote on monetary policy. That doesn’t mean he always agreed. His concerns about the U.S. central bank’s continued asset purchases after the 2007-2009 recession, which were shared by two other Fed governors, helped force a policy turn in 2013 that compelled it to start reducing its massive holdings of bonds despite then-Chair Ben Bernanke’s misgivings. Now it is Powell, the Fed chief since 2018, who is feeling the heat and, like Bernanke, has to try and shape consensus as policymakers approach yet another critical turning point: when and how to start withdrawing the extraordinary stimulus they put in place to shield the economy from the COVID-19 pandemic. In recent days, a steady drumbeat of Fed officials have offered competing timelines about when to start tapering the Fed’s $120 billion in monthly purchases of Treasuries and mortgage-backed securities amid surging inflation and strong job gains. Discord among the core group of the Federal Open Market Committee’s permanent voting members, who are typically more reticent to voice firm views, has also sprung out into public, a sure sign of intense debate behind closed doors. For his part, Powell, has said the Fed is “a ways off” from meeting the “substantial further progress” threshold that was to set in motion the start of the bond-buying taper. He has also repeatedly said he thinks high inflation readings are temporary. Data on Wednesday showed U.S. consumer price gains slowed in July even as they remained at a 13-year high on a yearly basis amid tentative signs inflation has peaked. The Fed has long been a “consensus” body which derives much of its credibility from policy actions that for decades have been overwhelmingly backed by voting members. Formal dissents occur – three regional Fed presidents dissented in 2019 – but in the last quarter of a century only two Fed governors have done so. The last time was in 2005. Still, even “the threat of dissent is powerful,” said Narayana Kocherlakota, a University of Rochester economics professor who dissented a number of times while he was president of the Minneapolis Fed from 2009 to 2015. “If you were a voter, there was an attempt made to stretch what the committee was putting together in order for everybody to go along with it … the chairs I worked under preferred not to have dissents.”
GDP at (Covid) Risk? – and State and Behavioral Response –Menzie Chinn – As of last week, GDP originating in counties with rising death rates accounts for 60% of total; still below the 80% recorded in the Winter. Source: Deutsche Bank, Covid Tracker, 5 August 2021. Source: Deutsche Bank, Covid Tracker, 5 August 2021. These are results based on reported data as of 4 August. It is unclear what the economic implications of high Covid death rates would be. If state authorities impose public health measures such as restricting indoor business activity, then one might see a decline in high contact service related activity and hence output. However, reaction functions vary widely across states. For instance, we can see hospitalization rates rising above peak in Florida, and yet there is no evidence of a state government response. Hence, there may be no short run impact on activity (although risk averse behavior might come into play, reducing economic activity nonetheless). Source: Newnodes, accessed 8/9/2021.(The above regards short-run implications. Obviously, with a sufficiently high death/incapacitation rate, hours worked might decline measurably in the longer term, as suggested in some models.).More on Florida from several days ago (the situation is changing fast) here.
Early Q3 GDP Forecasts: Around 6% to 7% with “Significant downside risk” –From BofA: We look for growth of 7.0% qoq SAAR in 3Q … We forecast retail sales fell by 2.3% mom in July, reflecting cooling service demand on Delta concerns and weaker online spend from the pull forward in the timing of Prime day. This poses significant downside risk to our 3Q GDP forecast; if we are correct, 3Q GDP tracking could fall to 3%. [August 13 estimate] From the NY Fed Nowcasting Report: The New York Fed Staff Nowcast stands at 3.8% for 2021:Q3. [August 13 estimate] And from the Altanta Fed: GDPNow: The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2021 is 6.0 percent on August 6, down from 6.1 percent on August 5. [August 6 estimate]
Seven High Frequency Indicators for the Economy –These indicators are mostly for travel and entertainment. The TSA is providing daily travel numbers.This data is as of August 8th. This data shows the 7-day average of daily total traveler throughput from the TSA for 2019 (Light Blue), 2020 (Blue) and 2021 (Red). The 7-day average is down 21.7% from the same day in 2019 (78.3% of 2019). (Dashed line) There was a slow increase from the bottom starting in May 2020 – and then TSA data picked up in 2021 – but the dashed line has mostly sideways over the last six weeks. The second graph shows the 7-day average of the year-over-year change in diners as tabulated by OpenTable for the US and several selected cities. This data is updated through August 7, 2021. Since some restaurants have not reopened, the actual year-over-year decline is worse than shown. Dining picked up during the holidays, then slumped with the huge winter surge in cases. Dining was generally picking up, but has moved sideways or down recently. The 7-day average for the US is down 9% compared to 2019. This data shows domestic box office for each week and the median for the years 2016 through 2019 (dashed light blue). The data is from BoxOfficeMojo through August 5th. Movie ticket sales were at $119 million last week, down about 47% from the median for the week. This graph shows the seasonal pattern for the hotel occupancy rate using the four week average. Occupancy is well above the horrible 2009 levels. With solid leisure travel, the Summer months have had decent occupancy – but it is uncertain what will happen in the Fall with business travel. This data is through July 31st. The occupancy rate is down 6.2% compared to the same week in 2019. Note: Occupancy was up year-over-year, since occupancy declined sharply at the onset of the pandemic. This graph, based on weekly data from the U.S. Energy Information Administration (EIA), shows gasoline supplied compared to the same week of 2019. Blue is for 2020. Red is for 2021. As of July 30th, gasoline supplied was up 1.3% compared to the same week in 2019. This is the 4th week so far this year when gasoline supplied was up compared to the same week in 2019.
Yields Plunge After Strongest 10Y Auction On Record -After yesterday’s solid 3Y auction, we speculated that demand for today’s benchmark 10Y refunding auction would depend completely on today’s CPI print. Well, after the first CPI miss since February earlier today, it was full speed ahead and nowhere was that more obvious than in the just concluded sale of $41 billion in 10Y paper which may have been the strongest 10Y auction in years, if not history.Starting at the top, the high yield of 1.34% was a stunner because the 10Y When Issued was trading at 1.372% just moments before the auction suggesting a burst of demand into the 1pm deadline. This was the biggest stop through in our record which goes back some 7 years, cementing just how furious demand for today’s auction was.The Bid to Cover surged from 2.39 to 2.65 which was the highest since May 2020; naturally it was far above the six-auction average of 2.42. But it was the internals that were the biggest surprise because with Indirects taking down 77.2%, this was the highest award to foreign buyers on record! And with Indirects taking an all time high, while Directs were more or less in line at 13.1%, down from 17.5% last month, Dealers were left with a record low award, taking down just 9.6%, the lowest on record.
Biden’s infrastructure bill on cruise control to Senate passage – President Joe Biden’s bipartisan infrastructure deal cleared its final serious Senate hurdle Sunday night, putting the legislation on a glide path to passage as soon as late Monday. In a 68-29 vote, the Senate closed down debate on a bill negotiated by a bipartisan group of 10 senators that spends $550 billion in new money on the nation’s physical infrastructure. Sunday’s vote came after senators spent the weekend haggling over amendments and time agreements to consider them. Final passage of the legislation is expected late Monday night, or the wee hours of Tuesday at the latest, unless a deal is reached among all 100 senators to speed it up. A 50-hour budget debate and an unlimited “vote-a-rama” on nonbinding but politically symbolic topics will follow immediately after. “We will move forward to wrap this up as expeditiously as possible, and then move on to the budget resolution,” said Senate Majority Leader Chuck Schumer after the vote. “The two-track process is moving along. It’s been a process that has been a very good process. It’s taken a while, but it’s going to be worth it.” A total of 18 Senate Republicans, including Senate Minority Leader Mitch McConnell, joined all 50 Senate Democrats to advance the physical infrastructure bill. Sens. Dan Sullivan (R-Alaska) and Roger Wicker (R-Miss.) supported ending debate, after previously voting against moving forward. Meanwhile, Sen. Todd Young (R-Ind.), who is up for reelection in 2022, announced he would oppose the bill, citing concerns about the national debt. Young was part of a larger group of 20 senators that supported the bipartisan infrastructure talks. Prior to the vote Sunday evening, senators spent the weekend trying to negotiate amendments changing the infrastructure bill’s cryptocurrency regulations and allowing coronavirus aid money to be spent on infrastructure. But they did not reach an agreement. Sen. Bill Hagerty (R-Tenn.) said Saturday that he would not allow the infrastructure bill to pass more quickly, dampening the Democratic majority’s enthusiasm for allowing the GOP to have more amendment votes. The Senate has considered more than 20 amendments to the bill thus far, but attempts to vote on two dozen more fell apart on Thursday night after Hagerty refused to expedite the bill as a condition of the deal. Hagerty on Sunday afternoon attempted to bring up 17 amendments by unanimous consent, but Sen. Kyrsten Sinema (D-Ariz.) objected, citing his refusal to come to a time agreement and potential objections from other senators. Other GOP senators also tried unsuccessfully on Sunday to bring up their own amendments. “We have wasted all day Thursday, Saturday and now through Sunday,” said an exasperated Sen. Chuck Grassley (R-Iowa). “That’s enough time to vote on a multitude of amendments, and we just sat around those three days, accomplishing nothing.” Grassley voted against ending debate Sunday, citing his complaints about the amendment process. However, he told reporters after that he’d still support final passage. The infrastructure bill could theoretically be amended after Sunday’s vote. But that would require cooperation from all 100 senators, making the prospects unlikely.
Democrats leave out debt ceiling hike from budget for $3.5T spending plan – Senate Democrats on Monday unveiled a budget blueprint that paves the way for a massive spending plan they want to pass without GOP support later this year. The budget resolution, which includes instructions for how to draft the $3.5 trillion bill, does not include an increase to the debt ceiling. Democrats can pass the budget resolution and the spending plan on their own if all 50 of their members stay unified, under a process known as reconciliation. Republicans, bristling at the spending package, have warned that they won’t put up the 10 GOP votes needed to raise the debt ceiling outside of the budget process. Though the budget resolution can still be changed, the Democratic plan to leave it out paves the way for a massive fight this fall over the nation’s borrowing limit. Democrats want to pass the budget resolution this week, after the Senate wraps up its work on a roughly $1 trillion bipartisan infrastructure package. Senate committees will then have until mid-September to write their parts of the $3.5 trillion bill, in what is expected to be a weeks-long haggling session to try to lock down support from all 50 Democrats. Senate Majority Leader Charles Schumer (D-N.Y.) said in a letter to his caucus that the budget resolution was a starting point for the negotiations among Democrats over the spending package. “Please remember that the resolution only includes ‘top-line’ reconciliation instructions to the committees, and that every Senator will have opportunities to shape and influence the final reconciliation bill after adoption of the Budget Resolution,” Schumer wrote to the caucus. He added that the budget resolution “provides a target date of September 15th to the committees to submit their reconciliation legislation. We will work towards this goal and meet, as a caucus, during the week of the 15th to review the bill.” The budget resolution includes instructions for 12 Senate committees to have a hand in drafting the $3.5 trillion spending plan. It also greenlights Democrats to include a slew of major priorities in their spending package later this fall including universal pre-K for 3- and 4-year-olds, expanding Medicare, providing “lawful permanent status for qualified immigrants” and clean energy technology. The details of the spending plan are expected to go through weeks of intense negotiations among Democrats as Schumer tries to work to lock down support from every member of his caucus. Sen. Kyrsten Sinema (D-Ariz.) has raised concerns about the price tag and Sen. Joe Manchin (D-W.Va.) has sent warning signs over the debt. But any attempt to go smaller would likely spark fierce pushback from progressives in both chambers.
McConnell doubles down on debt ceiling fight – – Senate Minority Leader Mitch McConnell (R-Ky.) doubled down Monday on his warning that Republicans won’t help raise the debt ceiling as Democrats appear poised to exclude it from a spending package they can pass along party lines. “Here’s the comedy, they won’t let Republicans have any say in this monstrosity but they want our help raising their credit card to make it happen,” McConnell said, referring to Democrats’ plans to pass a $3.5 trillion spending package. “Democrats want Republicans to help them raise the debt limit so they can keep spending historic sums of money with zero Republican input and zero Republican votes,” he added. Congress and the Trump administration agreed to suspend the debt ceiling in 2019. The borrowing limit then kicked back in earlier this month, with the Treasury Department using “extraordinary measures” to help keep the government solvent. But they’re expected to need to formally raise, or suspend, the debt ceiling later this year. Republicans, bristling over the Democratic spending package, have been pushing Democrats to include it in a massive spending package they will try to pass without GOP votes under a process known as reconciliation. But Democrats released a budget resolution on Monday that includes instructions for drafting the spending package that did not include language paving the way for including a debt ceiling hike. That means Democrats will need GOP support in order to raise the debt ceiling. To raise it outside of the budget process, they will need at least 10 Republican votes. Democrats could also try to attach it to a must-pass bill, like a government funding measure, to try to jam Republicans into voting for it.
Senate Passes $1 Trillion Infrastructure Bill – – The Senate gave overwhelming bipartisan approval on Tuesday to a $1 trillion infrastructure bill to rebuild the nation’s deteriorating roads and bridges and fund new climate resilience and broadband initiatives, delivering a key component of President Biden’s agenda. The vote, 69 to 30, was uncommonly bipartisan. The yes votes included Senator Mitch McConnell of Kentucky, the Republican leader, and 18 others from his party who shrugged off increasingly shrill efforts by former President Donald J. Trump to derail it. “This historic investment in infrastructure is what I believe you, the American people, want, what you’ve been asking for for a long, long time,” Mr. Biden said from the White House as he thanked Republicans for showing “a lot of courage.” Mr. McConnell, who publicly declared that his priority was stopping the Biden agenda, said in a statement that “I was proud to support today’s historic bipartisan infrastructure deal and prove that both sides of the political aisle can still come together around common-sense solutions.” The measure faces a potentially rocky and time-consuming path in the House, where Speaker Nancy Pelosi and a majority of the nearly 100-member Progressive Caucus have said they will not vote on it unless and until the Senate passes a separate, even more ambitious $3.5 trillion social policy bill this fall. That could put the infrastructure bill on hold for weeks, if not months. The legislation is, no doubt, substantial on its own. It would be the largest infusion of federal investment into infrastructure projects in more than a decade, touching nearly every facet of the American economy and fortifying the nation’s response to the warming of the planet. Funding for the modernization of the nation’s power grid would reach record levels, as would projects to better manage climate risks. Hundreds of billions of dollars would go to repairing and replacing aging public works projects. With $550 billion in new federal spending, the measure would provide $65 billion to expand high-speed internet access; $110 billion for roads, bridges and other projects; $25 billion for airports; and the most funding for Amtrak since the passenger rail service was founded in 1971. It would also renew and revamp existing infrastructure and transportation programs set to expire at the end of September. ” With a bipartisan victory pocketed, Democrats turned immediately to a more partisan venture, a second social policy package that would fulfill the remainder of their spending priorities. The Senate’s $3.5 trillion social policy budget, which is expected to pass along party lines late Tuesday or early Wednesday, will allow Senate committees to draft legislation packed with policies to address climate change, health, education, and paid family and medical leave, and pass it over the threat of a filibuster. It will also include tax increases – and is expected to generate unanimous Republican opposition.
U.S. Senate pivots to $3.5 trillion bill, key to Biden’s agenda — – The Democratic-controlled US Senate on Tuesday passed a massive infrastructure bill and immediately debated a $3.5 trillion spending blueprint for President Joe Biden’s key priorities on climate change, universal preschools and affordable housing. started. Here the bipartisan $1 trillion infrastructure bill, passed by the 100-member chamber in a 69-30 vote, could provide the nation’s biggest investment in decades in roads, bridges, airports and waterways. With a small majority in the Senate, Democrats here increasingly turned to a budget proposal directed at spending for a multi-trillion dollar follow-up package. They plan to push the package forward over the next few months using a process called “budget reconciliation,” which bypasses the chamber’s usual rules requiring 60 votes to pass most laws. House of Representatives Speaker Nancy Pelosi has repeatedly said that her chamber will not take up the infrastructure bill or the spending package until both are delivered, requiring the Democratic leadership to bring legislation to Biden’s table. This would require holding together its narrow majority in Congress. “Today we’re taking this country in a very different direction” with a budget plan that will ask “the wealthiest people in our country to start paying their fair share of taxes,” said Senate Budget Committee Chairman Bernie Sanders, one of the Senate’s most liberal members, said Tuesday as the debate began. Senator Lindsey Graham, the top Republican on the budget committee, said against the spending plan, it would fuel inflation, inflict higher taxes and energy costs on working Americans, and open the border to more illegal immigration. “In 2022, that idea will be on the ballot, and my goal and my Republican allies’ is to fight like hell,” Graham said, referring to next year’s contests that will determine Congress’s control. The Senate on Tuesday launched a “vote-a-rama,” a process that gives senators the opportunity to propose amendments to the budget proposal. The debate can go on for days unless party leaders agree to a shorter duration. House Majority Leader Steny Hoyer, a Democrat, said if the Senate passes it, the House will return on Aug. 23 to consider the budget proposal.
Senate OKs $3.5T budget plan after energy, enviro debates – The Senate early this morning adopted a $3.5 trillion budget framework that sets the stage for congressional Democrats to pass sweeping legislation aimed at combating climate change and expanding other domestic programs this fall. The Senate adopted the budget in a party line vote, 50-49, after debating several amendments related to energy and the environment, including a unanimous vote against the Green New Deal. Even though the amendments were nonbinding, they aimed to put lawmakers on the record about hot-button issues. The Senate is now in its summer recess. House Democratic leaders announced yesterday they would return from their recess on Aug. 23 to adopt a budget plan, which is likely to match the Senate effort. The maneuvering would allow committees in both chambers to begin drafting the budget reconciliation package with hopes of having legislation ready soon after Congress returns in mid-September. While the details of the legislation are still to come, the contours outlined in the budget direct several committees to draft plans for a federal clean energy standard for the first time, an overhaul of renewable energy tax incentives, and record levels of spending on climate initiatives, among them a Civilian Climate Corps (Greenwire, Aug. 9). Democrats say their plan would complement and build on a $1.1 trillion dollar infrastructure bill that passed the Senate yesterday and is also expected to pass the House (Greenwire, Aug. 10).The Senate, ahead of the budget resolution’s final passage, held a wide ranging debate on hundreds of amendment, with Republicans notching some largely symbolic wins on contested energy matters.Senators adopted 57-42 an amendment by Sen. Kevin Cramer (R-N.D.) to bar the White House Council on Environmental Quality and EPA from promulgating regulations of guidance to ban hydraulic fracturing.Fracking, Cramer argued, has made the U.S. a global leader in oil and gas production, reducing emissions and the domestic use of imported and dirtier fuels from places like Russia.But Budget Chair Bernie Sanders (I-Vt.) invoked this week’s dire report from the Intergovernmental Panel on Climate Change to push back. “We have got to move away from fossil fuel,” he said. “We have to end fracking.”The Democrats supporting Cramer’s amendment all hailed from fossil fuel-producing states, including New Mexico’s Martin Heinrich and Ben Ray Lujfln, Michael Bennet and John Hickenlooper of Colorado, Montana’s Jon Tester, and Energy and Natural Resources Chair Joe Manchin of West Virginia. Independent Sen. Angus King of Maine also supported the amendment.
The Senate Passes A $3.5 Trillion Budget Proposal. It’s The Latest Win For Biden : NP – Democrats pushed a $3.5 trillion framework for bolstering family services, health, and environment programs through the Senate early Wednesday, advancing President Joe Biden’s expansive vision for reshaping federal priorities just hours after handing him a companion triumph on a hefty infrastructure package.Lawmakers approved Democrats’ budget resolution on a party-line 50-49 vote, a crucial step for a president and party set on training the government’s fiscal might at assisting families, creating jobs and fighting climate change. Higher taxes on the wealthy and corporations would pay for much of it. Passage came despite an avalanche of Republican amendments intended to make their rivals pay a price in next year’s elections for control of Congress. House leaders announced their chamber will return from summer recess in two weeks to vote on the fiscal blueprint, which contemplates disbursing the $3.5 trillion over the next decade. Final congressional approval, which seems certain, would protect a subsequent bill actually enacting the outline’s detailed spending and tax changes from a Republican filibuster in the 50-50 Senate, delays that would otherwise kill it. Senate Budget Committee Chairman Bernie Sanders, I-Vt., once a progressive voice in Congress’ wilderness and now a national figure wielding legislative clout, said the measure would help children, families, the elderly and working people – and more. “It will also, I hope, restore the faith of the American people in the belief that we can have a government that works for all of us, and not just the few,” he said. Republicans argued that Democrats’ proposals would waste money, raise economy-wounding taxes, fuel inflation and codify far-left dictates that would harm Americans. They were happy to use Sanders, a self-avowed democratic socialist, to try tarring all Democrats backing the measure.If Biden and Senate Democrats want to “outsource domestic policy to Chairman Sanders” with a “historically reckless taxing and spending spree,” Republicans lack the votes to stop them, conceded Senate Minority Leader Mitch McConnell, R-Ky. “But we will debate. We will vote.”The Senate turned to the budget minutes after it approved the other big chunk of Biden’s objectives, a compromise $1 trillion bundle of transportation, water, broadband and other infrastructure projects. That measure, passed 69-30 with McConnell among the 19 Republicans backing it, also needs House approval.Senate Majority Leader Chuck Schumer, D-N.Y., assured progressives that Congress will pursue sweeping initiatives going beyond the infrastructure compromise. It was a nod to divisions between the party’s moderates and liberals that he and Pelosi will have to resolve before Congress can approve their fiscal goals. Democrats control the House but only narrowly. “To my colleagues who are concerned that this does not do enough on climate, for families, and making corporations and the rich pay their fair share: We are moving on to a second track, which will make a generational transformation in these areas,” Schumer said.
Brace For “Nasty” Debt Ceiling Fight As GOP Goes Full “Scorched Earth Mode” On Democrats – After Senate Republicans handed Democrats enough votes to pass their $1.2 trillion infrastructure package on Tuesday,they’re digging in and planning to go into ‘scorched earth mode’ over the debt ceiling, according to RBC strategist Blake Gwinn, who says that a “nasty standoff” is all but guaranteed.“I get that they would prefer a suspension of the limit vs. a numerical increase, but I can’t see any way Democrats are going to get 10 Republican votes for a debt ceiling deal in regular order, short of some extremely painful concessions,” Gwinn said according to Bloomberg, adding “I expect GOP will be in scorched Earth mode this fall.”As Bloomberg explains, “this means further bill paydowns and a decline in the Treasury’s cash balance will drive a richening of bills versus OIS, flattening of the front-end bill curve toward zero, “specific mispricings” of Treasuries around the anticipated drop-dead date, repo softness. Worse comes to worst, there’s the risk of potential ratings action, though it hasn’t come to this since the 2011 debt ceiling episode.”The news comes after the Wall Street Journal reported that 46 Senators have signed a pledge to force Democrats to raise the debt ceiling via budget reconciliation – a process which doesn’t rely on at least 10 GOP Senators to pass legislation.In the letter, the Republicans said that Democrats need to take responsibility for the consequences of their spending, including the $1.9 trillion coronavirus-relief package that passed the Senate earlier this year without any Republican support. CBO said last month that faster economic growth spurred by the relief bill will likely offset the measure’s entire cost, and estimated that deficits over the next decade will be slightly lower than last projected in February, before the bill passed. –WSJ“Democrats, at any time, have the power through reconciliation to unilaterally raise the debt ceiling, and they should not be allowed to pretend otherwise,” reads the letter, which adds that Republicans won’t be a party to boosting the debt limit via stand-alone bills or any other vehicle.”They shouldn’t be expecting Republicans to raise the debt ceiling to accommodate their deficit spending,” said Republican Sen. Ron Johnson, echoing previous comments by Senate Minority Leader Mitch McConnell (R-KY) that Democrats shouldn’t expect any help from Republicans on the debt limit.”This debt ceiling is going to cover all of the things that all of us have been opposing,” McConnell reiterated on Tuesday, adding that the Democrats “need to do the responsible thing and raise the debt ceiling, because America must never default on its debt.” The brewing conflict has sent October and November Treasury Bills down relative to the rest of the short-end curve, while the timing over when the government will actually hit the debt ceiling is unclear. As of August 9, the Treasury’s cash balance sat at $444 billion, up from $443 billion the prior session. While it started deploying ‘extraordinary measures’ this month to keep the government running, it wasn’t able to provide a specific estimate as to how long it will last. On Aug. 1, the debt limit, which had been suspended under a 2019 law, was reinstated at around $28.5 trillion, a figure that includes debt held by the public and debt held by government agencies. The Treasury uses emergency accounting maneuvers to conserve cash so the government can keep paying its obligations, but those measures are expected to run out some time in the fall. Unless Congress steps in to suspend the debt limit again, the Treasury could begin to miss payments on its obligations and default. –WSJ
Biden’s pushes for drug pricing reform while attempting to keep Democrats together on infrastructure deal -President Joe Biden called on Congress to move his $3.5 trillion plan forward that would among other things, lower the cost of prescription drugs. “There aren’t a lot of things that almost every American could agree on,” Biden said during a speech Thursday. “But I think it is safe to say that all of us, whatever our background or our age and where we live, could agree that prescription drug prices are outrageously expensive in America.” Three specifics of the plan would be allowing Medicare representatives to negotiate on prices wirth drug makers, putting a cap on how much seniors pay out of pocket and increase the number of more affordable generic drugs available. “These prices have put the squeeze on too many families, and stripped them of their dignity. They’ve been forced, forced people into terrible choices between maintaining their health, paying their rent or their mortgage, putting food on the table. I mean, literally,” Biden said. Prices for insulin and Multiple Sclerosis medication have jumped 1,200% and 1,000% respectively since the 90’s. Biden overcame skepticism, deep political polarization and legislative gamesmanship to win bipartisan approval in the Senate this week of his $1 trillion infrastructure bill. But as the bill moves to consideration in the House on Aug. 23 alongside a $3.5 trillion budget that achieves the rest of Biden’s agenda, the president is facing an even more complicated task. He must keep a diverse, sometimes fractious Democratic Party in line behind the fragile compromises that underpin both measures. If Biden and Democratic leaders in Congress hope to succeed with what they’ve called a two-track legislative strategy, the months ahead will almost certainly be dominated by a tedious balancing act. With exceedingly slim majorities in Congress, Biden can’t afford many defections in a party whose members include moderates and progressives. “Is it going to be easy?” Senate Majority Leader Chuck Schumer said Wednesday. “Absolutely not. But if past is prologue, we got a chance – a decent chance.” The trouble has been brewing for months. In a May 17 letter to House Speaker Nancy Pelosi and Schumer, a group of 59 House Democrats referred to new investments in the range of $7 trillion to $9.5 trillion. The Senate Democrats also had their share of members with concerns. In a letter to leadership, Sen. Joe Manchin of West Virginia, one of two high-profile moderate senators, expressed misgivings about the size of the $3.5 trillion package. “It is simply irresponsible to continue spending at levels more suited to respond to a Great Depression or Great Recession – not an economy that is on the verge of overheating,” Manchin said in a statement. He urged colleagues “to seriously consider this reality as this budget process unfolds.” At the same time, progressives in the House, fresh off forcing the administration’s hand on reviving a moratorium on evictions, have made clear they see a moment to wield power. With no votes to spare in the evenly split 50-50 Senate and a slim margin in the House, any single senator or a few representatives could deny Biden the majority he needs for passage. Knowing that they must appease all in their party, Biden and the Democratic congressional leadership have pushed to simultaneously pursue the infrastructure and budget bills.
Moderates revolt on infrastructure in new challenge for Pelosi — The Democrats’ strategy for enacting President Biden’s agenda hit a major snag Friday when nine House moderates bucked party leaders with threats of tanking a $3.5 trillion budget bill unless they can vote first on the Senate’s $1 trillion bipartisan infrastructure deal. The ultimatum flips leadership’s preferred sequence on its head, and it presents a blunt challenge to Speaker Nancy Pelosi (D-Calif.), who has laid out carefully choreographed plans to withhold a House vote on the bipartisan bill until the Senate passes a second, larger package of health, climate and safety net benefits later this year. The notion of linking the two bills reflects the demand of House progressives, who simply don’t trust their moderate colleagues – particularly those in the Senate – to support the “family” benefits package if the more popular funding for physical infrastructure has already become law. The budget resolution, which lays the groundwork for the larger reconciliation package, has already passed the Senate and is scheduled for a House vote the week of Aug. 23. Yet the competing demands from the party’s furthermost ideological wings has created an impasse, at least temporarily, and if Biden’s year-one economic agenda is to be enacted, one side will have to give in. That means either some progressives will have to change their tune and support infrastructure without Senate passage of the $3.5 trillion social benefits package, or some moderates will have to drop their threat and support the budget resolution without an infrastructure vote beforehand. Neither side appeared ready to budge on Friday. “With the livelihoods of hardworking American families at stake, we simply can’t afford months of unnecessary delays and risk squandering this once-in-a-century, bipartisan infrastructure package,” the nine moderates, led by Rep. Josh Gottheimer (D-N.J.), wrote to Pelosi. “It’s time to get shovels in the ground and people to work.” Liberals wasted little time firing back. Rep. Pramila Jayapal (D-Wash.), citing Biden’s pledge to fortify the post-pandemic economy for all Americans, argued Democrats have “a moral imperative” to deliver on that promise. “Anyone who votes to slow down or stop progress on this popular and necessary Build Back Better reconciliation package is voting against the President’s and the Democrats’ agenda,” Jayapal, the head of the Congressional Progressive Caucus, said in a statement. In sharper words, Jayapal blasted out a campaign fundraising email warning that the moderates were threatening to sink Biden’s plans to expand paid leave, housing subsidies, Medicare and efforts to address climate change. “Blocking this from passing means blocking these priorities – and we can’t allow it,” the email reads. Pelosi, for her part, has remained silent on the topic. And White House officials, who did not hold a press briefing Friday, did not respond to a request for comment.
National Academies’ Report Took Pharma-Friendly Stance After Millions in Gifts From Drugmakers – -To several U.S. senators, it looked wasteful, even outrageous. Every year, taxpayers pay for at least $750 million worth of expensive pharmaceuticals that are simply thrown away. Companies ship many of the drugs in “Costco“-size vials, one lawmaker said, that once opened usually cannot be resealed or saved for other patients. Yet pharma gets paid for every drop.So Congress turned to the prestigious National Academies of Sciences, Engineering and Medicine for advice, given its reputation for “independent, objective reports” on such matters. The national academies’ influential report, released in February, struck physicians who’ve tracked the issue as distinctly friendly to Big Pharma. It advised against an effort to recoup millions for the discarded drugs. It concluded that Medicare should stop tracking the cost of the drug waste altogether.Yet the report left out a few key facts, a KHN investigation has found.Among them: One committee member was paid $1.4 million to serve on the board of a pharmaceutical corporation in 2019 and in 2020 joined the board of a biotechnology company that lists government “cost containment” efforts as a risk to its bottom line.Another committee member reported consulting income from 11 to 13 pharmaceutical companies, including eight that Medicare records show have earned millions billing for drug waste. His pharma ties were disclosed in unrelated publications in 2019 through this year.Those committee members said they reported relevant relationships to the national academies and that the information is readily available outside of the report.What’s more: The National Academy of Sciences itself for years has been collecting generous gifts from foundations, universities and corporations, including at least $10 million from major drugmakers since 2015, its treasurer reports show. Among the donors are companies with millions to retain or lose over the drug waste committee’s findings.
A U.S. scientist settled his federal whistle-blowing complaint over Covid treatments. –Rick Bright, the virologist who claimed the Trump administration retaliated against him last year by ousting him from his job, has settled his whistle-blower complaint against the federal government and will receive back pay and compensation for “emotional stress and reputational damage,” his lawyer said Monday.Dr. Bright’s removal last April as head of the Biomedical Advanced Research and Development Agency created upheaval within the Department of Health and Human Services in the earliest days of the coronavirus pandemic.He said he was removed from his post after he pressed for rigorous vetting of hydroxychloroquine, an anti-malaria drug embraced by President Donald J. Trump as a coronavirus treatment, and that the administration had put “politics and cronyism ahead of science.” Those allegations are still being investigated by the Office of Special Counsel, which protects federal whistle-blowers. Under Mr. Trump, H.H.S. officials denied any wrongdoing. Neither side disclosed details or specifics of the settlement. But Dr. Bright’s lawyer, Debra S. Katz, said her client had been compensated to the fullest extent allowed by the law. She said he will receive back pay, as well as damages to cover the costs of private security and temporary housing that he required after receiving threats. He will also receive compensation, Ms. Katz said, for distress “associated with the disparaging comments and threats” made by administration officials including Mr. Trump, who had blasted Dr. Bright on Twitter as a “creep” and a “disgruntled employee.”Dr. Bright now works for the Rockefeller Foundation, where he is developing a new institute devoted to pandemic prevention that will function as a hub for scientists in government, the private sector and academia.
FDIC seeks industry feedback on the future of remote exams – – The Federal Deposit Insurance Corp. is asking banks to comment on their experience with remote exams in the pandemic.The FDIC’s request for information, published in the Federal Register on Thursday, appears aimed at helping the agency develop longer-term best practices for off-site bank monitoring. The agency asked bankers to reflect on more than a year and half of largely remote bank examinations, with comments due Oct. 12. The agency is “seeking comment on what worked well in the off-site examination context to inform plans for future examinations, consistent with applicable law and the purpose of examinations,” it said in the RFI.
Ginnie Mae extends comment period on nonbank capital plan — Ginnie Mae will give more time for financial institutions to comment on a plan that would impose new risk-based capital requirements on nonbanks and clarified that the changes will not take effect this year. Ginnie, an arm of the Department of Housing and Urban Development, said late Thursday that it will extend the comment period by 60 days to Oct. 8 on its request for input. The guarantee agency had asked for feedback on a plan to increase net worth and liquidity requirements on all financial institutions that issue Ginnie Mae securities. Ginnie initially gave lenders 30 days to respond.The plan has sparked an outcry from mortgage lenders because it would subject nonbanks to a 10% risk-based capital ratio – with a risk weight of 250% for mortgage servicing rights.
How the pandemic is accelerating trends in financial advice and changing the way Americans manage their money. – American Banker podcast – After a year of disruption in wealth management — widespread working from home, virtual meetings between financial advisors and their clients, volatility in the stock market — the world will hopefully begin recovering later this year. Many of the trends the pandemic in finance accelerated may be here to stay. Catherine Keating brings us her dispatches from the front lines of financial advice. Join us to hear about: Where is wealth management headed in a post-pandemic world?
What can wealth management do to help Americans fight student debt, underfunded retirement plans, and the difficulties of saving?
How can we increase diversity among wealth managers while serving an increasingly diverse population of investors?
How can we invest in a low-interest-rate environment?
Stress tests show GSEs would have enough capital to cover crisis losses —The mortgage giants Fannie Mae and Freddie Mac would face up to $20 billion in combined credit losses in the event of a severe financial downturn, according to stress test results released Friday by the Federal Housing Finance Agency.Although the credit losses would exceed those forecast under previous stress test scenarios, Fannie and Freddie likely maintain a large enough capital cushion to cover the projected losses. The government-sponsored enterprises, as part of an annual exercise required for institutions with more than $250 billion of assets, were tested against a hypothetical financial crisis scenario that featured a severe global recession with stressed commercial real estate and corporate debt markets as well as a global market shock.
CFPB servicing rule aims to stave off another foreclosure crisis –The impending termination of government aid for struggling homeowners is expected to spark a flood of foreclosures as early as next month, but the mortgage industry hopes a recent Consumer Financial Protection Bureau rule will help limit the damage.Federally sponsored forbearance plans begin expiring in September after a temporary foreclosure moratorium ended July 31. Many analysts believe foreclosures will soon be inevitable for hundreds of thousands of borrowers who were delinquent as soon as the pandemic began last year.But a CFPB rule taking effect Aug. 31 is designed to help servicers handle the flood of defaults and modification requests. A key provision enables lenders to process quick foreclosures for loans beyond repair, so they can focus on working with other borrowers and thereby mitigate cumulative foreclosures from COVID-19.
Fannie and Freddie: REO inventory declined in Q2, Down 49% Year-over-year Fannie and Freddie earlier reported results for Q2 2021. Here is some information on single-family Real Estate Owned (REOs). Note that COVID is impacting foreclosure activity, from Fannie: “The decline in single-family REO properties in the first half of 2021 compared with the first half of 2020 was due to the suspension of foreclosures that began in March 2020 as a result of the COVID-19 pandemic. In response to the pandemic and with instruction from FHFA, we have prohibited our servicers from completing foreclosures on our single-family loans through July 31, 2021, except in the case of vacant or abandoned properties.” Freddie Mac reported the number of REO declined to 1,477 at the end of Q2 2021 compared to 2,812 at the end of Q2 2020. For Freddie, this is down 98% from the 74,897 peak number of REOs in Q3 2010.Fannie Mae reported the number of REO declined to 6,363 at the end of Q2 2021 compared to 12,675 at the end of Q2 2020.For Fannie, this is down 96% from the 166,787 peak number of REOs in Q3 2010. Here is a graph of Fannie and Freddie Real Estate Owned (REO). REO inventory decreased in Q2 2021, and combined inventory is down 49% year-over-year.This is well below a normal level of REOs for Fannie and Freddie.
MBA Survey: “Share of Mortgage Loans in Forbearance Decreases to 3.40%” –Note: This is as of August 1st. From the MBA: Share of Mortgage Loans in Forbearance Decreases to 3.40%: The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 7 basis points from 3.47% of servicers’ portfolio volume in the prior week to 3.40% as of August 1, 2021. According to MBA’s estimate, 1.7 million homeowners are in forbearance plans.The share of Fannie Mae and Freddie Mac loans in forbearance decreased 5 basis points to 1.74%. Ginnie Mae loans in forbearance decreased 12 basis points to 4.18%, while the forbearance share for portfolio loans and private-label securities (PLS) decreased 7 basis points to 7.37%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers decreased 4 basis points to 3.63%, and the percentage of loans in forbearance for depository servicers decreased 10 basis points to 3.49%.”Forbearance exits increased as August began and new forbearance requests declined, resulting in the largest decrease in the share of loans in forbearance in three weeks,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “1.7 million homeowners remain in forbearance, 13% of whom were current on their payments as of August 1st. Of those who exited forbearance last week, more than 10.5% were current. Forbearance has surely provided both insurance and assurance for many of these homeowners who worried about ongoing hardships, and it is positive to see so many continue to be able to make their payments while in forbearance.””Delinquency rates have increased slightly for borrowers who have exited forbearance and began repayment plans, deferral plans, or modifications over the course of the pandemic. However, July’s strong job market report provides evidence of a rebounding economy, which should provide further support for homeowners exiting forbearance in the months ahead.” This graph shows the percent of portfolio in forbearance by investor type over time. Most of the increase was in late March and early April 2020, and has trended down since then. The MBA notes: “Total weekly forbearance requests as a percent of servicing portfolio volume (#) decreased relative to the prior week: from 0.06% to 0.04%.”Visit website
In A Boost To Landlords, Supreme Court Blocks Part Of New York’s Eviction Moratorium – The Supreme Court ruled in favor of landlords and partially blocked part of New York’s eviction moratorium on Thursday.The 6-3 ruling (the court’s three liberal judges – Stephen Breyer, Elena Kagan, and Sonia Sotomayor – dissented) lifts the part of the moratorium that allowed tenants to claim economic hardship by filling out a form; now, according to the Supreme Court, tenants must prove economic hardship with evidence in court.The ruling stated the moratorium “violates the Court’s longstanding teaching that ordinarily ‘no man can be a judge in his own case’ consistent with the Due Process Clause.””While I respect the U.S. Supreme Court as a separate judicial entity, I am deeply disappointed in the injunction issued yesterday that invalidates eviction protections for hundreds of thousands of tenants and denies New Yorkers this still necessary public health measure,” State Senator Brian Kavanagh, who co-sponsored the legislation, said in a statement.After the decision was announced, Lieutenant Governor Kathy Hochul, who will become New York’s Governor on August 24th, issued a statement, “No New Yorker who has been financially hit or displaced by the pandemic should be forced out of their home. As New York State’s next Governor, I look forward to working with the Legislature to quickly address the Supreme Court’s decision and strengthen the eviction moratorium legislation. I will work with our partners in the Legislature to help get the funding available to those in need as soon as possible.”
U.S. Supreme Court strikes down part of New York’s eviction ban -The U.S. Supreme Court has struck down at least part of New York’s eviction moratorium, potentially leaving thousands of renters in the state at risk of being forced out of their homes.The court’s order Thursday focused on the state’s policy of allowing tenants to self-attest that they’ve experienced a Covid-related hardship, rather than documenting the setback with evidence. “This scheme violates the court’s longstanding teaching that ordinarily ‘no man can be a judge in his own case,'” the majority wrote. Five New York landlords and one landlords’ association brought the challenge against the ban.The decision could trigger a humanitarian crisis in the state, said Rebecca Garrard, legislative director at Citizen Action of New York. “Given the sudden notice of this decision, we could see eviction numbers like we’ve never seen before,” Gerrard said. The statewide ban was supposed to be in effect through August, but now the entire protection is in jeopardy, she said, “If you’ve had a notice of eviction served within the last 30 days, you could be evicted today.”More than 830,000 tenants in New York are behind on their rent, with an average debt of $4,000.The ban was too broad and placed an “enormous burden” on landlords, said Olga Someras, general counsel at the Rent Stabilization Association of New York City.”All you had to do was check a box; in theory, it applied to millionaires,” Someras said. “There were stories where tenants were using the law meant to protect vulnerable New Yorkers as a sword rather than a shield to take advantage of landlords.”The ruling on New York’s ban is separate from the new nationwide eviction moratorium, announced by the Centers for Disease Control and Prevention earlier in the month. That protection applies until Oct. 3 and to places where Covid rates remain high.However, the ruling suggests that broader ban may, too, be at risk.”This is a very bad sign for how the Supreme Court is going to land and rule on the CDC’s moratorium when it inevitably lands at their feet,” Garrard said.
Evicted, Despite a Federal Moratorium: ‘I Do Not Know What I am Going to Do’ – – Inside Courtroom 8A of Las Vegas Justice Court last week, the benches were packed with renters and landlords battling over evictions that continued at a brisk pace despite a last minute, two-month extension of the federal protections meant to keep people in their homes. Vanessa Merryman, 41, was among the tenants ordered to leave her apartment. “I have never been homeless in my life,” she said through tears, slouched on a metal bench outside the courtroom as the scorching Las Vegas sun beat through the windows. She was shellshocked that the court session that upended her life lasted all of 15 minutes. “I do not know what I am going to do,” she said. “It is really scary.” The federal moratorium on evictions – combined with billions of dollars in rent subsidies – was supposed to avert the scenario of millions of Americans being turned out of their homes after they lost their jobs during the pandemic and were unable to afford their rent. Yet despite these efforts, many local governments and courts were not sure how to apply the extension, and desperate tenants continued to flood local government websites seeking rental assistance that was usually slow in coming. “The lay of the land has been confusing at every level, not just to tenants, but also to landlords, court personnel and judges,” said Dana Karni, manager of the Eviction Right to Counsel Project in Houston. In extending the moratorium last week, the Biden administration hinged it to high local coronavirus infection rates – the idea being that protection was warranted in areas where the virus was surging. Clark County, including Las Vegas, was among hundreds of counties that meet the criterion for high infection rates, but the federal Centers for Disease Control and Prevention guidelines gave some leeway to judges to instead apply state laws, which at times allowed for evictions. “While the extension of C.D.C. protections is much needed, the confusion that surrounds its existence waters down its impact,” Ms. Karni said. For many tenants, it was too late anyway. With state moratoriums expiring and the expectation that the federal guidelines would be gone soon, court dockets like those in Las Vegas overflowed with eviction cases. Tenants had to actively file for protection under the C.D.C. measures, but many of them were unaware of that. And as eviction proceedings rolled forward, some landlords won, citing reasons other than nonpayment of rent for seeking to remove tenants.
Leading Index for Commercial Real Estate “Pulls Back in July” –From Dodge Data Analytics: Dodge Momentum Index Pulls Back in July: The Dodge Momentum Index fell to 155.8 (2000=100) in July, a 6% decline from the revised June reading of 164.9. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year.Both components of the Momentum Index fell in July. Commercial planning fell 3%, while institutional planning dropped 9%.The Momentum Index posted strong gains through much of the winter and spring as the economy and building markets began to stabilize following the recession. While the economy has continued its forward progress through the summer, the Index has regressed somewhat as higher material prices and shortages of skilled labor continue to exert a strong influence over the construction sector. Despite the declines in June and July, the Momentum Index remains near levels last seen in 2018. Compared to a year earlier, the Momentum Index was 25% higher than in July 2020 – institutional planning was up 27% and commercial planning was 25% higher than last year.This graph shows the Dodge Momentum Index since 2002. The index was at 155.8 in June, down from 164.9 in June.According to Dodge, this index leads “construction spending for nonresidential buildings by a full year”. This index suggests a decline in Commercial Real Estate construction through most of 2021, but a pickup towards the end of the year, and growth in 2022 (even with the decline in the July index).
Close to 50% of US Workers Can’t Afford to Rent One Bedroom Housing —Yves Smith – I am late to post on an important study by the National Low Income Housing Coalition, Out of Reach 2021, which is embedded at the end of this post. However, it appears to have gone under the radar when it first appeared last month; CNN was one of the few major US outlets to write up the damning report. The Guardian helped correct this lapse by posting on the report yesterday, which is how I cam across it. Among other things, it finds that a minimum wage worker can’t afford a one-bedroom rental in any county in the US.Needless to say, before gentrification, many US cities has housing alternatives for low wage workers or those who’d had a bad run of luck. They were called “flophouses” in the Depression and later “single room occupancy hotels” in New York City: a not large room with a bed, and communal toilets and showers. Now their options are things like couch surfing, living in their car (assuming they have one), being a roommate (often in an overcrowded unit), going to a shelter, sleeping on the street, or going into debt. And even seeming middle class workers can’t make ends meet due to housing costs:Ironically, the National Low Income Housing Coalition lists JP Morgan as its lone big supporter.The linchpin to the analysis is that HUD sees 30% as a realistic maximum for what a full time worker should pay for rental housing. The National Low Income Housing Coalition using that to derive a National Housing Wage:The 2021 National Housing Wage is $24.90 per hour for a modest two- bedroom rental home and $20.40 per hour for a modest one-bedroom rental home … .The federal minimum wage of $7.25 per hour falls well short of both the two-bedroom and one- bedroom National Housing Wages … Thirty states, the District of Columbia, and several dozen counties and municipalities now have minimum wages higher than the federal minimum wage, but even taking higher state and county minimum wages into account, the average minimum wage worker must work nearly 97 hours per week (more than 2 full- time jobs) to afford a two-bedroom rental home or 79 hours per week (almost 2 full-time jobs) to afford a one-bedroom rental home at the fair market rent. People who work 97 hours per week and need 8 hours per day of sleep have around 2 hours per day left over for everything else – commuting, cooking, cleaning, self-care, caring for children and family, and serving their community. Doing so is an impossibility for a single parent who needs a larger-than-one-bedroom apartment. Even for a one-bedroom rental, it is unreasonable to expect individuals to work 79 hours per week to afford their housing … .The struggle to afford rental housing is not confined to minimum-wage workers. The average renter’s hourly wage of $18.78 is $6.12 less than the national two-bedroom Housing Wage and $1.62 less than the one-bedroom Housing Wage. As a result, the average renter must work 53 hours per week to afford a modest two- bedroom apartment. Many single parents or caregivers find it difficult to work those hours.
Delta variant, supply-chain chaos could derail back-to-school shopping -U.S. shoppers are growing more anxious about visiting stores and trying on clothing in dressing rooms, according to a recent survey. Some of those polled by First Insight also say they are beginning to cut back on spending due to the resurgence in Covid cases. Both trends threaten to slow momentum for what many were predicting to be an incredibly strong back-to-school shopping season. Deloitte has estimated that back-to-school spending for kids in grades K-12 would reach $32.5 billion this year, up 16% from 2020 and 17% from 2019. That averages out to about $612 per student. The consulting firm’s estimates were based on a poll of 1,200 parents completed from May 27 to June 5. A lot has changed since then. Although parents may have extra cash after rounds of government stimulus checks and child-tax credit payments, the recent surge in Covid cases fueled by the delta variant could upset these predictions. Couple that with tight inventories, caused by shipping disruptions and conservative planning on the part of retailers and things may not be as rosy as they looked when students began their summer breaks. No doubt, there are worries back-to-school plans could change at the last minute. After all, the Centers for Disease Control and Prevention recently reversed its policy on masking, calling for vaccinated individuals to once again wear masks indoors to prevent Covid’s spread. The new guidance has prompted consumers to rethink decisions about dining out, traveling and making other purchases. Fifty-six percent of consumers say they’re proactively cutting back their spending at retail establishments, First Insight found in a survey of 1,038 people it fielded on Thursday. That’s up from 52% a month earlier, when the predictive consumer analytics firm asked consumers the same questions about their shopping behaviors tied to the pandemic. First Insight’s poll also found that 64% said they are generally anxious about the pandemic, up from 51% in July. Fifty-six percent reported feeling nervous about interacting with sales associates in stores, a sharp increase from 43% in July. “The tail winds that retailers and restaurants have enjoyed recently may be short-lived,” S&P Global Ratings analyst Sarah Wyeth said in a report to clients.
BLS: CPI increased 0.5% in July, Core CPI increased 0.3% – From the BLS:The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent in July on a seasonally adjusted basis after rising 0.9 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 5.4 percent before seasonal adjustment.The indexes for shelter, food, energy, and new vehicles all increased in July and contributed to the monthly all items seasonally adjusted increase. The food index increased 0.7 percent in July as five of the major grocery store food group indexes rose, and the food away from home index increased 0.8 percent. The energy index rose 1.6 percent in July, as the gasoline index increased 2.4 percent and other energy component indexes also rose.The index for all items less food and energy rose 0.3 percent in July after increasing 0.9 percent in June. Along with shelter and new vehicles, the indexes for recreation, for medical care, and for personal care increased in July. The index for used cars also increased in July, but the 0.2-percent advance was much smaller than in recent months. The index for motor vehicle insurance declined in July, and the index for airline fares fell slightly.The all items index rose 5.4 percent for the 12 months ending July, the same increase as the period ending June. The index for all items less food and energy rose 4.3 percent over the last 12 months, while the energy index rose 23.8 percent. The food index increased 3.4 percent for the 12 months ending July, compared to a 2.4-percent rise for the period ending June. CPI was at expectations, and core CPI was slightly below expectations. I’ll post a graph later today after the Cleveland Fed releases the median and trimmed-mean CPI.
Consumer Price Index: July Headline Remains at 5.4% – The Bureau of Labor Statistics released the July Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 5.37%, down fractionally from 5.39% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 4.27%, down from 4.47% the previous month and above the Fed’s 2% PCE target.Here is the introduction from the BLS summary, which leads with the seasonally adjusted monthly data:The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent in July on a seasonally adjusted basis after rising 0.9 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 5.4 percent before easonal adjustment.The indexes for shelter, food, energy, and new vehicles all increased in July and contributed to the monthly all items seasonally adjusted increase. The food index increased 0.7 percent in July as five of the major grocery store food group indexes rose, and the food away from home index increased 0.8 percent. The energy index rose 1.6 percent in July, as the gasoline index increased 2.4 percent and other energy component indexes also rose.The index for all items less food and energy rose 0.3 percent in July after increasing 0.9 percent in June. Along with shelter and new vehicles, the indexes for recreation, for medical care, and for personal care increased in July. The index for used cars also increased in July, but the 0.2-percent advance was much smaller than in recent months. The index for motor vehicle insurance declined in July, and the index for airline fares fell slightly.The all items index rose 5.4 percent for the 12 months ending July, the same increase as the period ending June. The index for all items less food and energy rose 4.3 percent over the last 12 months, while the energy index rose 23.8 percent. The food index increased 3.4 percent for the 12 months ending July, compared to a 2.4-percent rise for the period ending June. Read moreInvesting.com was looking for a 0.5% MoM change in seasonally adjusted Headline CPI and a 0.4% in Core CPI. Year-over-year forecasts were 5.3% for Headline and 4.3% for Core.The first chart is an overlay of Headline CPI and Core CPI (the latter excludes Food and Energy) since the turn of the century. The highlighted two percent level is the Federal Reserve’s Core inflation target for the CPI’s cousin index, the BEA’s Personal Consumption Expenditures (PCE) price index.
“Transitory” Inflation Cooling As “Sticky” Heats Up: Here Is The Heatmap From Today’s CPI Report -First the facts: core CPI rose 0.3% (0.33% unrounded) mom in July, coming in a touch below consensus at 0.4% mom and cooling off notably following the prior three months of average 0.8% spikes. Unfavorable base effects led to the % yoy rate dropping to 4.3% (4.27% unrounded) from 4.5% yoy in June. At the same time, headline CPI came in stronger at 0.5% (0.47% unrounded), boosted by a 1.6% pop in energy and 0.7% jump in food, which kept the % yoy unchanged at 5.4%.According to BofA – and judging by the market’s delighted kneejerk response – this month revealed significant cooling in transitory inflation. First on the goods shortages theme: used car prices edged up 0.2% mom, even though new cars were much stronger at 1.7% mom. Some joked that this is an example of carbitrage, where “people buy new cars then flip them for profit as used cars”That said, and as noted earlier, given the signal from wholesale used car prices as per the Mannheim Used Vehicle Indexwhich began to turn lower in June, BofA expects negative readings in CPI used cars beginning next month in further relief to “transitory” inflation. Car/truck rental prices also dropped 4.6% mom following record gains in previous months, likely reflecting the start of a negative payback.Meanwhile, price pressures were mixed across commodities: household furnishings/supplies edged up 0.1% mom, apparel was flat, and both medical commodities and other goods rose 0.2% mom. Meanwhile, recreation and education/communication commodities saw stronger readings of 0.5% and 0.8%, respectively.Not everything “transitory” declined, however: reopening strength continued with lodging exploding 6.0% mom. However, airline fares edged down -0.1% mom leaving prices still 9.7% below pre-pandemic levels, perhaps in response to the recent media panic over the Delta variant. High frequency travel data have shown signs of plateauing in recent weeks, amid rising virus cases, which point to limited upside in airline fares in coming months. The broader transportation services sector plunged 1.1% mom, with a 2.8% dive in motor vehicle insurance a big drag. This largely reflects distorted seasonal factors after auto insurance credits were offered in spring 2020. Finally, seasonal factors support another big decline in August, though turn favorable in September which should lead to choppiness.
Producer prices soar 7.8% annually in July, most on record | Fox Business – Producer prices accelerated at the fastest annual pace on record in July as supply chain disruptions and materials shortages continued to put upward pressure on costs. The producer price index for final demand increased at a 7.8% pace for the 12 months ended July, according to the Labor Department. The July print was faster than the 7.3% pace recorded in June and ahead of the 7.3% rate that analysts surveyed by Refinitiv were expecting. The reading was the strongest since recordkeeping began in November 2010. Producer prices rose 1% in July, matching the increase from June. Analysts were anticipating prices would grow at a 0.6% pace. Nearly three-quarters of the increase was due to the 1.1% rise in prices for final demand services, the largest on record. Almost half of the increase was due to a 1.7% rise in margins for final demand trade services, which measure changes in margins received by wholesalers and retailers. Approximately 20% of the increase can be attributed to margins for automobiles and automobile parts retailing, which jumped 11.2%. Airline passenger services and hospital outpatient care were among the other indexes that saw gains. Portfolio management saw a 1.8% decline. Indexes for chemicals and allied products wholesaling and for fuels and lubricants retailing also turned lower. Prices for final demand goods, meanwhile, rose 0.6%. Prices for tobacco products saw a notable 2.7% increase while prices for beef and veal fell 11.6%. Core producer prices, which exclude food and energy, rose 1% in July, double the 0.5% gain that was expected. Core prices climbed 6.2% annually, compared to the 5.6% increase that was forecast. The year-over-year increase was the largest since the data series began in August 2014.
Weekly Initial Unemployment Claims decrease to 375,000 –The DOL reported:: In the week ending August 7, the advance figure for seasonally adjusted initial claims was 375,000, a decrease of 12,000 from the previous week’s revised level. The previous week’s level was revised up by 2,000 from 385,000 to 387,000. The 4-week moving average was 396,250, an increase of 1,750 from the previous week’s revised average. The previous week’s average was revised up by 500 from 394,000 to 394,500.This does not include the 104,572 initial claims for Pandemic Unemployment Assistance (PUA) that was up from 94,427 the previous week.The following graph shows the 4-week moving average of weekly claims since 1971. The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 394,000.The previous week was revised up. Regular state continued claims decreased to 2,866,000 (SA) from 2,980,000 (SA) the previous week.Note: There are an additional 4,820,787 receiving Pandemic Unemployment Assistance (PUA) that decreased from 5,156,982 the previous week (there are questions about these numbers). This is a special program for business owners, self-employed, independent contractors or gig workers not receiving other unemployment insurance. And an additional 3,852,569 receiving Pandemic Emergency Unemployment Compensation (PEUC) down from 4,246,207.Weekly claims were close to the consensus forecast.
BLS: Job Openings Increase to Series High 10.1 Million in June – From the BLS: Job Openings and Labor Turnover Summary; The number of job openings increased to a series high of 10.1 million on the last business day of June, the U.S. Bureau of Labor Statistics reported today. Hires rose to 6.7 million and total separations edged up to 5.6 million. Within separations, the quits rate increased to 2.7 percent. The layoffs and discharges rate was unchanged at 0.9 percent, matching the series low reached last month.The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.This series started in December 2000.Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for June, the most recent employment report was for July. Note that hires (dark blue) and total separations (red and light blue columns stacked) are usually pretty close each month. This is a measure of labor market turnover. When the blue line is above the two stacked columns, the economy is adding net jobs – when it is below the columns, the economy is losing jobs.The huge spikes in layoffs and discharges in March 2020 are labeled, but off the chart to better show the usual data.Jobs openings increased in June to 10.073 million from 9.483 million in May. This is a new record high for this series.The number of job openings (yellow) were up 65% year-over-year. Quits were up 46% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for “quits”).
June JOLTS report: at last, new hires (slightly) outpace record job openings — This morning’s JOLTS report for May was the best we have seen since the immediate rebound from the pandemic lockdowns. There was yet another record level continued all of unfilled job openings, yet another new record low in layoffs and discharges, an enhanced number of people quitting their jobs, and finally – for the first time this year – a huge number of new hires, setting a new m/m record high outside of the immediate lockdown rebound last year. Here are the month over month percentage changes for each of those metrics: As noted above, headline job openings (blue), which have been making new all-time records for month, were finally joined by a nearly 700,000 gain in actual hires (gold): Voluntary quits also rose, and are higher than any other prior month except this past April: The record number of people voluntarily quitting their jobs (meaning they are not eligible for unemployment benefits) is testimony to the record robustness of the jobs market. Finally, while total separations (light blue, left scale) are at normal levels, layoffs and discharges (violet, right scale) declined to yet another all time low: This is a market that is beginning to arrive at a new equilibrium, after having been out of equilibrium for most of this year. Almost nobody is getting laid off, but lots of people are quitting. But the big change is, while there are continued record openings, finally there is hiring outpacing the level of new openings to fill them. I want to share two other graphs that I came across recently. The first, from Wolf Richter, shows that continued unemployment claims have declined in the aggregate in States that have cut off pandemic unemployment benefits vs. those that have retained them: One drawback of this graph is that we can’t tell if the difference is driven by just one or two of the big States, but I think it makes a valid point that is also consistent with this second graph, which I have posted previously but was forwarded to me again last week: Together, these show that while undoubtedly for some of those people not entering the job market continued pandemic jobless benefits are an issue, for many more the lack of COVID safety in the locale where they live, the unavailability of reasonable-cost child care, or the general low pay for the labor required, are keeping them on the sidelines. A great deal depends on the course of the Delta wave. If it burns through the dry tinder and recedes over the next 45 days, then we may see openings gradually level off and begin to decline, while hiring continues to increase sharply. If not, well, . . . .
Average grocery, restaurant worker pay hits $15 an hour for first time – Average pay for restaurant and grocery workers rose above $15 an hour for the first time, according to Labor Department data reviewed by The Washington Post.The Labor Department reported that in June, the most recent month where data is available, nonmanagerial restaurant workers earned an average of $15.31 an hour, which is a more than 10 percent increase from the $13.86 hourly wage workers were taking home before the pandemic, the Post noted. Grocery store workers took home on average $15.04 an hour in June, which was up 7 percent from when the pandemic began.Workers in seafood markets, office supply stores, liquor stores, day care services and janitorial services also saw hourly wages surpass the $15 benchmark, according to the Post, in addition to parking lot attendants and individuals who care for the elderly or disabled. Overall, almost 80 percent of all workers in the U.S. now take home paychecks that offer at least $15 an hour, according to the Post. In 2014, that number sat at just 60 percent.The U.S. added 943,000 jobs in July, causing the unemployment rate to drop 0.4 percentage points to 5.4 percent. The increase in jobs came amid a summer rush of travel and recreation spending, as severe COVID-19 restrictions eased. Democrats on Capitol Hill tried to pass a federal minimum wage increase as part of the $1.9 trillion COVID-19 relief bill in February, but the Senate Parliamentarian ruled that the boost is not in line with budget rules.
Census data shows LGBT Americans hit harder by economic, food insecurity amid pandemic U.S. Census Bureau data released this week revealed that LGBT Americans have reported larger rates of economic and food insecurity amid the coronavirus pandemic than Americans who do not identify as members of the community. The findings came in the latest Household Pulse Survey, which the Census Bureau first launched in April 2020 to measure U.S. household experiences during the pandemic. This week’s report is the first to include data on gender identity and sexual orientation. The data, which was collected from July 21 to Aug. 2, found that nearly 20 percent of LGBT adults reported a loss of income in the previous four weeks, compared to about 17 percent of non-LGBT adults. Additionally, about 13 percent of adults who identified as LGBT said they lived in a household where there was either sometimes or often not enough food available to eat within the past week, compared to roughly 7 percent of non-LGBT adults. LGBT Americans were also more likely to report issues of covering basic expenses and other living costs, with nearly 37 percent saying they lived in a house that “had difficulty paying for usual household expenses” in the previous week. Comparatively, 26 percent of non-LGBT adults reported challenges in paying for household expenses. In homes that were rented or owned with a mortgage or loan, 8 percent of LGBT adults said they were not confident they would be able to meet their next housing payment, while 6 percent of non-LGBT Americans said the same. The latest data, which came from survey responses from a total of more than 64,000 U.S. households, suggests that the coronavirus pandemic may be exacerbating the financial challenges among LGBT Americans, who even before COVID-19 hit had already been more likely to experience greater financial hardship than non-LGBT people.
New Orleans Jazz Fest is canceled amid rise in virus cases. -The New Orleans Jazz & Heritage Festival has been canceled, officials said Sunday, citing the “exponential growth of new Covid cases in New Orleans and the region.”The festival, normally held in the spring, had been rescheduled for Oct. 8 to 17 in the hope that vaccinations would make the event possible. Ticket holders will receive emails soon outlining refund options.Reported cases hit a record high this month in Louisiana, with the state reporting an average of 4,600 new cases a day in the past week, according to a New York Times database. Hospitalizations are up 140 percent to a daily average of 2,037, and deaths have risen 193 percent to an average of 30 a day.Louisiana reinstated indoor mask mandates this month to try to help contain the infections that have been fueled by the state’s low vaccination rate and the highly contagious Delta variant of the virus. Only 37 percent of the state’s population has been fully vaccinated, according to New York Times data.Many employers have already canceled or delayed return-to-office plans, but Jazz Fest was one of the first major events to be canceled amid a wave of reported cases that Dr. Rochelle P. Walensky, the director of the Centers for Disease Control and Prevention, has called the “pandemic of the unvaccinated.”
Judge allows cruise line to temporarily require proof of vaccination in Florida. –A federal judge on Sunday granted Norwegian Cruise Line’s request for a preliminary injunction, temporarily allowing the company to require proof of vaccination from passengers despite a Florida law that bans businesses from doing so. Gov. Ron DeSantis’s office said in an emailed statement on Monday that it plans to appeal the ruling. Mr. DeSantis signed a state law in May that set fines for businesses requiring customers to provide proof of vaccination. Norwegian’s next cruise ship to sail from Florida is set for Aug. 15, out of Miami. In a statement on Sunday, the company said the ruling would allow it to “operate in the safest way possible.””We welcome today’s ruling that allows us to sail with 100 percent fully vaccinated guests and crew, which we believe is the safest and most prudent way to resume cruise operations amid this global pandemic,” said Frank Del Rio, the president and chief executive. In the order, Judge Kathleen Williams of U.S. District Court noted that scientific research shows that “cruise lines are hotbeds for Covid-19 transmission.” She also cited the potential for the cruise line to suffer financially if Norwegian was forced to cancel trips or reroute around Florida.
American, Delta, Southwest Airlines: No Immediate Plans For COVID-19 Vaccine Mandates Three major U.S. airlines – American, Delta, and Southwest – are currently not requiring COVID-19 vaccine mandates for staff, though they haven’t definitively ruled it out as a matter of future policy, according to reports and statements from spokespersons. Southwest CEO Gary Kelly wrote in an internal memo cited by CNN that he would “continue to strongly encourage” employees to get vaccinated, but that it would not be a requirement at this stage. “Obviously, I am very concerned about the latest Delta variant, and the effect on the health and safety of our employees and our operation, but nothing has changed,” Kelly wrote. A Southwest spokesperson told The Epoch Times in an emailed statement that “we still are strongly encouraging our Employees to vaccinate themselves and to share with us their vaccination status,” but beyond that “we don’t have anything else to share” on the topic.
Sturgis Motorcycle Rally kicks off amid COVID-19 surge fueled by Delta variant – Thousands of bikers have converged on the tiny South Dakota community of Sturgis for the annual 10-day Sturgis Motorcycle Rally.The rally got underway on Friday amid a surge of COVID-19 cases in the U.S. being fueled by the highly-contagious Delta variant. In South Dakota, cases spiked nearly 70% in the days before the rally started.The rally kicked off ceremoniously, with no mask mandates. No proof of vaccinations are needed, Mola Lenghi reports for “CBS This Morning: Saturday.””We’re not going to start checking papers. I mean, that’s not really an American way,” said Daniel Ainslie, city manager of Sturgis, which has a population of 7,000.Last year’s rally was pinned a superspreader event. This year, people can drink on the streets to avoid crowded bars.
Washington State sets vaccine mandate for government and health care workers. -The Washington State police in Seattle last month. Gov. Jay Inslee announced on Monday that state workers must be vaccinated against the coronavirus as a condition of employment.Credit…Jason Redmond/ReutersGov. Jay Inslee of Washington announced Monday that most state employees and all health care workers must be fully vaccinated against the coronavirus by Oct. 18, or risk losing their jobs.”We have essentially a new virus at our throats,” Mr. Inslee said at a news conference, referring to the Delta variant.Mr. Inslee went beyond similar orders issued by other states by saying that a refusal could lead to being fired. This would apply to both private and public sector workers, including 60,000 state employees, as well as 14,000 that work for King County and 10,000 employed by Seattle. The policy also includes contractors who work at state, county and city locations, like construction sites, offices and health care facilities.”These workers live in every community in our state, working together and with the public every day to deliver services,” Mr. Inslee said. “We have a duty to protect them from the virus, they have the right to be protected, and the communities they serve and live in deserve protection as well.” Applications will be considered for “legitimate medical reasons or sincerely held religious beliefs,” the governor said, but not for philosophical objections. Employees will not be able to forego the vaccine and get tested weekly.Mr. Inslee’s office said that the bill for coronavirus tests would be in the millions of dollars if continued indefinitely and the testing option had not worked well in public facilities like prisons, privately-run hospitals or nursing homes. “We’re past the point where we can test our way to safety,” he said. “They don’t solve the problem.”Mr. Inslee is using the emergency authority powers he was granted during the coronavirus pandemic to issue the new order, his office said. The state licenses health care workers in private facilities and settings, and the governor said that the same enforcement mechanism that comes into play when a medical error or the wrong medicine is given. “This is a life-and-safety rule,” he added.The directive does not extend to workers in higher education, public education, or employees of the legislative and judicial branches. “The reason we’re in this pickle today is because 30 percent of our eligible citizens, so far, have chose not to get to the vaccine,” Mr. Inslee said, emphasizing that it was not too late for both residents and state employees. But those on public salaries “essentially have to have your last vaccine by Oct. 4,” he said.
A wave of vaccine mandates sweeps the U.S. -As the Delta virus variant gathers speed, so are Covid-19 vaccine mandates: from the local level, like San Francisco’s strict mandate for indoor public spaces, to the vast federal bureaucracy.The flurry of increasingly strict vaccine rules for public workers, private companies and colleges comes as virus cases and hospitalizations have risen sharply, reaching rates not seen since their winter peak and testing the limits of hospitals across the United States. The mandates are only expected to accelerate once the Food and Drug Administration grants full approval to the vaccine in the coming weeks.About 50 percent of Americans are fully vaccinated, and vaccination rates have begun climbing again, to nearly 700,000 new doses administered every day. But tens of millions of Americans are still holding out.On Thursday alone, Covid vaccine mandates proliferated and gained support with a stunning swiftness:
- San Francisco leaders unveiled some of the nation’s toughest restrictions on unvaccinated people, barring them from indoor dining, bars, nightclubs, gyms, large concerts, theaters and other events held inside. The new rules, which take effect on Aug. 20, would apply even to people who can show they have tested negative for the coronavirus. City employees and restaurant and bar workers will be given a grace period.
- The Department of Health and Human Services said it would require more than 25,000 health workers – including contractors and volunteers – to receive coronavirus vaccines, becoming the latest federal agency to implement such a mandate. That goes beyond President Biden’s announcement last month that civilian federal workers would either have to be vaccinated or submit to severe restrictions. The mandate applies to members of the Indian Health Service and the National Institutes of Health who work in federally run facilities and deal with patients, and the U.S. Public Health Service, which is led by the surgeon general.
- The Department of Veterans Affairs will require nearly every worker, volunteer and contractor within its vast health care system to be vaccinated against the coronavirus over the next eight weeks. Last month, the department began requiring shots for 115,000 of its frontline health care workers, making it the first federal agency to mandate that employees, including doctors, dentists and registered nurses, be inoculated. The expansion will impact about 245,000 more workers.
- The Supreme Court allowed Indiana University to require students to be vaccinated against the coronavirus. Justice Amy Coney Barrett, who oversees the federal appeals court in question, turned down a request for emergency relief from a group of eight students who had sued, saying the requirement violated their constitutional rights to “bodily integrity, autonomy and medical choice.”
- The nation’s largest teachers’ union, the National Education Association, offered its support to policies that would require all teachers to get vaccinated against Covid or submit to regular testing. The announcement comes after Randi Weingarten, the powerful leader of the American Federation of Teachers, another major education union, signaled her strongest support yet for vaccine mandates on Sunday.
Peter Singer on compulsory vaccination – Peter Singer: The reason is that we are not good at protecting ourselves against very small risks of disaster. Each time we get into a car, the chance that we will be involved in an accident serious enough to cause injury, if we are not wearing a seat belt, is very small. Nevertheless, given the negligible cost of wearing a belt, a reasonable calculation of one’s own interests shows that it is irrational not to wear one. Car crash survivors who were injured because they were not wearing seat belts recognize and regret their irrationality – but only when it is too late, as it always is for those who were killed while sitting on their belts.We are now seeing a very similar situation with vaccination. Brytney Cobia recently posted on Facebook the following account of her experiences working as a doctor in Birmingham, Alabama:“I’m admitting young healthy people to the hospital with very serious COVID infections. One of the last things they do before they’re intubated is beg me for the vaccine. I hold their hand and tell them that I’m sorry, but it’s too late. A few days later when I call time of death, I hug their family members and I tell them the best way to honor their loved one is to go get vaccinated and encourage everyone they know to do the same. They cry. And they tell me they didn’t know. They thought it was a hoax. They thought it was political. They thought because they had a certain blood type or a certain skin color they wouldn’t get as sick. They thought it was ‘just the flu.’ But they were wrong. And they wish they could go back. But they can’t.”The same reason justifies making vaccination against COVID-19 compulsory: otherwise, too many people make decisions that they later regret. One would have to be monstrously callous to say: “It’s their own fault, let them die.” I look forward to Jason Brennan’s rebuttal.
“No Mingling”: Hawaii Revives COVID-19 Restrictions Over Fear Of Delta Variant –The state of Hawaii announced it would reintroduce restrictions on social gatherings due to the COVID-19 Delta variant.“With COVID-19 cases going up, the State of HawaiÊ»i is taking precautions now to avert a strain on our healthcare systems. To that end – I’ll be signing an Executive Order that will limit social gatherings, effective immediately,” Gov. Dan Ige, a Democrat, announced Wednesday on Twitter.The order would limit capacity at restaurants, bars, gyms, and social establishments to 50 percent of capacity. It also caps indoor and outdoor gatherings to 10 and 25 people, respectively.“Patrons in restaurants bars and social establishments must remain seated with parties maintaining at least 6 ft distancing between groups (with maximum groups size of 10 indoors and 25 outdoors); there will be no mingling, and masks must be worn at all times except when actively eating or drinking,” according to a news release from his office.The order also stipulates that county governments “will review proposals for all professionally sponsored events for more than 50 people, to ensure that appropriate safe practices will be implemented.” “Organizers of these professional events must notify and consult with the following county agencies prior to the event. County approval is required for professional events for more than 50 people,” Ige’s office added.The policies will remain in effect until Oct. 18, according to Ige’s office, unless another order is implemented.
San Francisco announces strict requirements barring the unvaccinated from indoor spaces. – San Francisco leaders on Thursday unveiled some of the nation’s toughest restrictions on unvaccinated people, barring them from indoor dining, bars, nightclubs, gyms, large concerts, theaters and other events held inside. The new rules, which take effect on Aug. 20, would apply even to people who can show they have tested negative for the coronavirus.The rules are similar to those announced by Mayor Bill de Blasio of New York earlier this month, except that San Francisco will require patrons to be fully vaccinated while New York requiresonly a minimum of one dose. The new requirements come amid a flurry of increasingly strict vaccine rules for public workers, private companies and colleges and as virus cases and hospitalizations have risen sharply across the country that are only expected to accelerate once the Food and Drug Administration grants full approval to the vaccine in the coming weeks.San Francisco’s order does not apply to people dining outdoors, entering a restaurant to order take-out or to children under 12, who are not yet eligible for vaccines.City officials indicated that they will give more leeway to employees of affected businesses than to patrons. Restaurant and bar workers have until Oct. 13 to prove that they are fully vaccinated, a move that the mayor said was designed to prevent people from losing their jobs. The city is also giving a grace period toits 35,000 municipal employees, who are required to be vaccinated 10 weeks after the final F.D.A. approval. Health care workers and those who work in homeless shelters, jails and other congregate settings considered high risk have until Sept. 15 to be vaccinated.
Big City Mayors Leaving Office After COVID, Mass Protests –The unprecedented COVID-19 crisis, major financial problems, race reckoning, and the movement to defund the police have caused a growing number of big city mayors look for new careers. They are citing burnout and a feeling of being blamed for problems far beyond their control, according to Politico. Seattle Mayor Jenny Durkan will not seek a second term even though she has many years of experience in politics having served as a federal prosecutor. Washington state was hit hard and early by COVID and Durkan was unprepared for the tremendous challenges of running a city during a pandemic. She was faced with pandemic surges and demonstrations over police brutality. For her, it was like running an Ironman at a sprint pace. “When you’re in the cauldron, making those tough decisions, it becomes much more clear. I could either do the job they elected me to do or run to keep the job. But I couldn’t do both,” Durkan, a Democrat and daughter of Martin Durkan, a state legislator and power broker in Washington state, told Politico. Durkan had proposed cutting the Seattle police budget by $20 million or about five percent and she wanted more police reforms in response to George Floyd’s death. Protestors and even some city councilors who supported the Defund the Police movement wanted a 50% cut. A large group of demonstrators including a city councilor marched in her neighborhood last summer after they determined her address which had been hidden. Durkan and her family had been receiving death threats. She received messages like “Guillotine Jenny” that were written on her street. “You can come to my house 100 times and that’s not going to stop me from doing what I think is right. But it did make things inordinately more difficult because I was worried not just about my own personal security but the security of my family,” said Durkan. The lockdowns caused by COVID led to a huge economic downturn that damaged city budgets. Eventually federal aid helped alleviate some of the problems but not before many people lost their jobs and businesses. The killing of George Floyd led to big protests in many U.S. cities and then there were problems created by the most contentious presidential election in recent times. Some cities were literally burning because of these controversies. Many city leaders want out some for personal reasons or because they are termed-out but others want out because they believe it is not worth the stress or that another person might be more suited for the job. “It is time to pass the baton,” said Atlanta Mayor Keisha Lance Bottoms as she announced she would not seek a second term. Bottoms does not know what her next move will be.
Arkansas’ governor says it ‘was an error’ to ban mask mandates.-Gov. Asa Hutchinson of Arkansas said on Sunday that he had made a mistake in signing a law banning mask mandates in his state.”It was an error to sign that law. I admit that,” Mr. Hutchinson, a Republican, said on the CBS program “Face the Nation.”Arkansas, which has one of the lowest vaccination rates in the country, has seen cases approach last winter’s surge counts. It now has a seven-day rolling average of 2,351 new daily cases.”Facts change, and leaders have to adjust to the new facts and the reality of what you have to deal with,” Mr. Hutchinson said. “Whenever I signed that law, our cases were low, we were hoping that the whole thing was gone, in terms of the virus, but it roared back with the Delta variant.”Mr. Hutchinson signed the bill banning mask mandates in April, and he had been working to modify it in the wake of rising case counts and outbreaks at schools. But the state legislature has declined to take up the new legislation. On Friday, a judgetemporarily blocked the ban, allowing schools and other government entities in Arkansas to require masks.
New data shows a mass exodus from U.S. public schools, especially kindergarten. -As the pandemic upended life in the United States, more than one million children who had been expected to enroll in public schools did not show up, either in person or online. The missing students were concentrated in the younger grades, with the steepest drop in kindergarten – more than 340,000 students, according to government data. Now, the first analysis of enrollment at 70,000 public schools across 33 states offers a detailed portrait of these kindergartners. It shows that just as the pandemic lay bare vast disparities in health care and income, it also hardened inequities in education, setting back some of the most vulnerable students before they spent even one day in a classroom.The analysis by The New York Times in conjunction with Stanford University shows that in those 33 states, 10,000 local public schools lost at least 20 percent of their kindergartners. In 2019 and in 2018, only 4,000 or so schools experienced such steep drops.The months of closed classrooms took a toll on nearly all students, and families of all levels of income and education scrambled to help their children make up for the gaps. But the most startling declines were in neighborhoods below and just above the poverty line, where the average household income for a family of four was $35,000 or less. The drop was 28 percent larger in schools in those communities than in the rest of the country.While kindergarten is optional in many states, educators say there is no great substitute for quality, in-person kindergarten. For many students, it’s their introduction to school. They are taught to cooperate and to identify numbers and letters. They learn early phonics and number sense – the concept of bigger and smaller quantities.
Some children who had mild Covid are facing confounding long-term symptoms.Will Grogan stared blankly at his ninth-grade biology assignment. It was work he had mastered in class the day before, but now it looked utterly unfamiliar.”I don’t know what you’re talking about,” he blurted to his teacher and classmates, who reminded him how he’d answered questions about the topic the previous class. “I’ve never seen this before,” he insisted, becoming so distressed that the teacher excused him to visit the school nurse.The episode, earlier this year, is one of numerous cognitive mix-ups that have plagued Will, 15, since he contracted Covid-19 in October, along with fatigue, aching legs and dizziness. As young people across the United States prepare to return to school, many are struggling to recover from lingering neurological, physical or psychiatric symptoms.Often called “long Covid,” the symptoms vary from patient to patient, as does the duration and severity. Studies estimate long Covid may affect 10 percent to 30 percent of adults infected with the coronavirus. Estimates from the handful of studies of children so far range widely.Pediatric coronavirus cases have risen sharply, driven by the highly contagious Delta variant and the fact that well under half of 12- to 17-year-olds are vaccinated and children under 12 are still ineligible.
DeSoto Parish superintendent debunks rumor of 100+ kids being out with COVID . (KSLA) – The superintendent of DeSoto Parish Schools is addressing a rumor that has been circulating about more than 100 kids being out due to COVID-19.KSLA reached out to Superintendent Clay Corley Wednesday, Aug. 11 after receiving messages from a number of concerned parents. The superintendent provided us with the following response:“We have seen some instances of positive Covid cases. Similar to what we saw throughout last school year. We continue to monitor our numbers closely and communicate daily with the Dept. of Health to work through all close contact and quarantine situations. We would like to remind parents and families to remember to follow the self-screening guidance and keep children at home if they are experiencing any symptoms. We will also be offering vaccination clinics at all schools throughout the school year for students and staff beginning next week. Dates are available on our website and through our various social media platforms.” The Louisiana Department of Health (LDH) tracks outbreaks at schools in the state. Click here to keep up with their data.
Dallas schools to defy governor’s order and require masks – A Dallas school district is defying Texas Gov. Greg Abbott’s (R) ban on mask mandates in schools and will require all staff, students and visitors to wear face coverings on district property beginning Tuesday. The Dallas Independent School District (ISD) said the new measure comes as the Centers for Disease Control and Prevention and Dallas County health officials have increased the local COVID-19 alert to level red, and reported that hospitalizations are increasing at the quickest pace since the beginning of the pandemic, including among children. The district noted in a statement that while no vaccines are authorized for children under the age of 12, “school attendance is mandatory, and virtual learning is not an option at this time.” It said it will provide masks and sanitizer at buildings within the district and continue contact tracing in “keeping with the top priority of safeguarding the health and well-being of staff and students.” The new policy comes after Abbott signed an executive order in May that prohibited “governmental entities in Texas,” including school districts, counties, cities, public health authorities and government officials, from imposing mask mandates. The governor’s office said that individuals who try to violate the order by requiring masks be worn could be subject to a fine of up to $1,000. The Dallas ISD addressed Abbott’s executive order in its statement, writing that the governor demand “does not limit the district’s rights as an employer and educational institution to establish reasonable and necessary safety rules for its staff and students.” “Dallas ISD remains committed to the safety of our students and staff,” the district added. Florida Gov. Ron DeSantis (R) has signed a similar order prohibiting mask mandates in schools throughout the Sunshine State.M
Tennessee schools face state threats over mask mandates – Tennessee’s two largest school districts’ attempts to protect more than 200,000 students, teachers and staff from COVID-19 face threats of funding cuts from state officials. Memphis/Shelby County and Nashville/Davidson County school systems have implemented mandatory mask wearing for students, teachers, staff and anyone else entering schools and school buses. Memphis schools open today, August 9, and Nashville schools tomorrow, August 10. Memphis established the policy some time ago for this school year while Nashville’s school board approved the policy by an 8-1 vote on Thursday. As of this writing, Nashville and Memphis are the only two school systems in the state to have such mandates. A high-ranking state official immediately shot back that he would ask the governor for a special session of the state legislature to create what amounts to an emergency voucher program for those opposed to school mask mandates. “I’m going to ask the governor for legislation to allow those parents in those school districts to take their money through school choice and to go wherever they deem they need to go,” House Speaker Cameron Sexton told the Tennessean . Memphis, one of the poorest cities of its size in the United States, has 223 schools serving 113,198 students, far and away the largest K-12 public school system in the state. Nashville follows with 168 schools and 85,500 students. Following a distant third is Knox County (Knoxville) where masking in the schools is optional. It has 91 schools and 61,545 students. When schools open, state officials could have a sword of financial destruction held over the heads of the two districts. The threat of funding cuts is directed against mask mandates, remote learning, or any effort to “segregate classrooms based on who has and hasn’t been vaccinated,” the Tennessean newspaper reported last week.
Parents surround health workers advocating for masks in schools: ‘We know who you are’ -A group of parents in Tennessee surrounded health care professionals outside of a school board meeting on Tuesday, after they advocated for mask mandate in the local school district, The Tennessean reported.According to video circulated on social media, a group of parents in Franklin, Tenn., surrounded the health care workers while they were leaving a building during a Williamson County School District Board meeting. The footage shows parents chanting “we’ll not comply” as the workers exit through building doors. Some parents are seen yelling obscenities toward one health care professional as he heads into the parking lot. One woman can be heard yelling “take that mask off!” As the footage continues, an unmasked man in a black shirt can be seen yelling at the health care worker who has made it into his car. “You’re not on our side!” he yells. “We know who you are.” Another man in a blue, long sleeved shirt confronted the driver. “We know who you are. You can leave freely, but we will find you,” he said, pointing a finger at the driver’s side window. The confrontation between parents and medical workers comes after the Williamson County Schools (WCS) voted on Tuesday to require a mask mandate for students and faculty members in their district, according to the Tennessean. Some of the parents in the district said that the mask mandate amounts to child abuse, according to the footage. The four-hour school board meeting drew a crowd of anti-mask protesters including former sports journalist and conservative political commentator Clay Travis, who has children that attend schools in the district, the Tennessean reported. Another video showed a male protester being escorted out of the building during the meeting by local authorities for being disruptive. Other protesters followed suit by leaving the board meeting as well.
DeSantis threatens to withhold salaries in school mask-mandate dispute –In his ongoing crusade against mask mandates in schools, Florida Gov. Ron DeSantis (R) announced on Monday that the Florida Board of Education could withhold the salaries of superintendents and school board members who defy his ban on facial coverings.”With respect to enforcing any financial consequences for noncompliance of state law regarding these rules and ultimately the rights of parents to make decisions about their children’s education and health care decisions, it would be the goal of the State Board of Education to narrowly tailor any financial consequences to the offense committed,” DeSantis’s office said in a statement to WFOR-TV. His office added that DeSantis’s priorities were “protecting parents’ rights” and “ensuring that every student has access to a high-quality education that meets their unique needs.” “For example, the State Board of Education could move to withhold the salary of the district superintendent or school board members, as a narrowly tailored means to address the decision-makers who led to the violation of law,” the statement continued.The Florida governor has already threatened to cut off funding to schools that enact mask mandates for students.DeSantis has been engaged in an ongoing spat with the Biden administration regarding his decision to prohibit mask mandates in Florida. Last week, two lawsuits were filed against DeSantis challenging his ban’s constitutionality.One of the suits argued that the Florida state constitution guaranteed a safe school environment and provided counties with the power to govern themselves.Fellow Republican Gov. Asa Hutchinson of Arkansas said last week that he regretted signing a ban on mask mandates, asking the state legislature to reverse the decision. Hutchinson said he had signed the law when cases were low in his state and argued that even if he hadn’t signed it, the legislature would have overridden him.
Local officials in Florida prepare to defy the governor’s no-mask mandate. – The recent rise in U.S. coronavirus cases has led local leaders to defy Republican governors who have banned mask mandates in states like Florida and Texas, where the virus is surging.The Centers for Disease Control and Prevention last monthrecommended universal masking in schools, regardless of vaccination status, and urged schools to reopen for in-person education.Starting on Tuesday, the Dallas public school district will require everyone on school property, including students, employees and visitors, to wear masks. The Austin public school district also announced its own universal mask mandate, which will start on Wednesday.The rules come as Gov. Greg Abbott of Texas remains one of the most strident opponents of mask mandates: His office said in a statement on Monday that he “has been clear that we must rely on personal responsibility, not government mandates.”In Florida, Gov. Ron DeSantis is threatening to withhold the salaries of local superintendents and school board members who enact them, even though just half of people in the state are vaccinated, and the Delta variant is driving a surge that has made the state one of the worst-hit in the nation. Forty-three percent of the state’s adult intensive-care beds are filled with coronavirus patients, The Wall Street Journal reported.Mr. DeSantis signed an executive order last month that blocked local officials from enacting mask mandates. But several local officials and community leaders are preparing to defy him.Schools in Leon County, Alachua County and Duval County have decided in recent weeks to require masks for students, although some schools are allowing students to opt out or are mandating them only for certain grades.The Broward County School District, one of the largest in Florida, also voted last month to require its students to wear masks, although in light of the governor’s recent executive order, the district said in a statement that it was “awaiting further guidance before rendering a decision on the mask mandate for the upcoming school year.”Other opponents of the bans are turning to the courts. Lawsuits have been filed against Mr. DeSantis’s order in Florida. In Texas, the top elected official in Dallas County sued Mr. Abbott on Monday evening, arguing that his ban on mask mandates violates state law.
Virginia will require masking in all K-12 schools. -Governor Ralph Northam of Virginia on Thursday announced a public health order requiring a universal mask mandate for all indoor school settings in kindergarten through 12th grade, becoming one of the latest governors to weigh in on the contentious fight over face coverings in schools.The order comes as schools around the United States have started returning to the classroom with a patchwork of approaches to masking and as the highly contagious Delta version of the coronavirus continues to spread rapidly around the country, leading to a rise in new infections and what the Centers for Disease and Control director called a “pandemic of the unvaccinated.”Virginia’s new policy, which went into effect immediately, echoes a state law signed in January that requires schools to follow guidelines issued by the C.D.C. Yet despite the law and the C.D.C.’s update to include broader masking guidelines, at least two school districts had voted as recently as this week to make masks optional. The announcement from Gov. Northam marks a shift from last month, when Virginia’s Department of Health and Department of Education released back-to-school guidance that merely advised masking in schools in all indoor settings, including for those in middle and high schools who were not fully vaccinated, but stopped short of issuing a mandate, instead leaving the decision up to the districts. But that guidance was released before the Centers for Disease Control and Prevention escalated its mask recommendations on July 27, a spokesperson for the governor said.
Union head indicates teachers may drop opposition to vaccine mandate. –Randi Weingarten, the head of the powerful American Federation of Teachers, expressed her strongest support to date for mandatory vaccination of educators against Covid-19, saying on Sunday that she would urge her union’s leadership to reconsider its position against vaccine mandates.”It’s not a new thing to have immunizations in schools,” Ms. Weingarten said on the NBC program “Meet the Press.” “And I think that on a personal matter, as a matter of personal conscience, I think that we need to be working with our employers, not opposing them, on vaccine mandates.”She called the rising number of coronavirus cases in the United States a “public health crisis. And the politics are infecting it.”She added that she felt the need “to bring people together and to stand up and say this as a matter of personal conscience.” Ms. Weingarten, who recently traveled to Missouri and Florida, both of which are reporting surges in Covid cases among the unvaccinated, said her change of heart was motivated by the rapid spread of the highly contagious Delta variant, the need to return children to the classroom, and her particular concern for the health of children under the age of 12, who do not have the option of getting vaccinated.
Newsom Announces Nation’s First Vax-Or-Test Rule For All Teachers And Staff –California has become the first state in the nation to require all teachers and school employees to be vaccinated or submit to regular Covid-19 testing.In a Wednesday announcement, Governor Gavin Newsom (D) made official a policy already employed by several school districts, including Long Beach Unified and districts in San Francisco, Oakland and Sacramento.As Fox5 notes, Los Angeles Unified School District – the largest in the state, and second-largest in the nation – has a slightly stricter policy in place, requiring weekly testing for all students and staff regardless of vaccination status.Newsom’s order, first reported Tuesday night by Politico and later confirmed by various media outlets, was announced by the governor during a late-morning visit to an elementary school in Alameda County. Newsom said California is the first state in the nation to implement such a sweeping requirement.The vaccination-or-testing requirement already has the support of the powerful Service Employees International Union, which represents thousands of school workers across the state. –Fox5Newsom’s latest edict won hilarious praise from the Service Employees International Group (SEIU) union, which less than two weeks ago opposed Newsom’s order requiring state workers show proof of vaccination or undergo regular testing due to the ‘abruptness’ of notification.”We share Governor Newsom’s commitment to increasing the rate of vaccination so we can better protect the students and families we serve from sickness and death, and prevent the virus from spreading to our own families and communities, and we support public health measures such as this which are designed to do so while giving workers a choice,” said SEIU California executive board member, Max Arias. “Worker-led school safety protocols have created the model for safe school reopening, and many school workers have already created similar agreements.”
California orders all teachers to be vaccinated or face regular testing. – California became the first state to issue a vaccine mandate for all educators in public and private schools on Wednesday when Gov. Gavin Newsom ordered teachers and school staff members to provide proof of vaccination against Covid-19 or face weekly testing.”We think it’ll be well-received to keep our most precious resource healthy and safe,” he said, “and that’s our children.”The policy applies to staff members serving students in kindergarten through 12th grade and will go into effect on Thursday, with the deadline for full compliance being Oct. 15.Similar mandates are gaining momentum among public and private employers as cases across the United States have jumped with the spread of the Delta variant.In Hawaii, officials announced last week that all state and county employees, including public-school teachers, must be vaccinated or be tested weekly. But California’s policy goes a step further by including private schools. While California officials initially emphasized they were merely encouraging everyone to get vaccinated, the governor announced late last month that the state would require vaccines or testing at least weekly for health-care workers and state government employees. Last week, state health officials made the requirement even more stringent, largely removing the testing option for more than two million health-care workers. But it wasn’t clear then whether California would extend a mandate to hundreds of thousands of educators.
The largest U.S. teachers’ union announces support for vaccination or testing for educators – The nation’s largest teachers’ union on Thursday offered its support to policies that would require all teachers to get vaccinated against Covid or submit to regular testing.It is the latest in a rapid series of shifts that could make widespread vaccine requirements for teachers more likely as the highly contagious Delta variant spreads in the United States.”It is clear that the vaccination of those eligible is one of the most effective ways to keep schools safe,” Becky Pringle, president of the National Education Association, said in a statement.The announcement comes after Randi Weingarten, the powerful leader of the American Federation of Teachers, another major education union, signaled her strongest support yet for vaccine mandates on Sunday.Ms. Pringle left open the possibility that teachers who are not vaccinated could receive regular testing instead, and added that local “employee input, including collective bargaining where applicable, is critical. Her union’s support for certain requirements is notable because it represents about three million members across the country, including in many rural and suburban districts where adults are less likely to be vaccinated. Overall, the union said, nearly 90 percent of its members report being fully vaccinated.
Los Angeles and Chicago schools will mandate teacher vaccinations. – As schools prepare to reopen five days per week amid an alarming surge in the coronavirus, Los Angeles and Chicago, the second and third-largest districts in the nation, announced on Friday some of the strongest teacher vaccine mandates to date.Educators and school staff in both cities will have to be fully vaccinated by Oct. 15. School begins in Los Angeles on Aug. 16 and in Chicago on Aug. 30.In Los Angeles, district employees will also have to submit to regular virus testing, regardless of vaccination status. In Chicago, staff will be tested weekly until the vaccine deadline. Both systems said there will be an exemption process for those with disabling medical conditions or sincerely held religious beliefs.California and Illinois are also both requiring everyone to use masks inside schools when they reopen.The new vaccine mandates will put pressure on other large school systems, particularly those in liberal states, to institute similar policies. New York City, the nation’s largest district, is currently planning to offer teachers the choice of either vaccination or weekly virus testing.Leaders of both national teachers’ unions, the National Education Association and the American Federation of Teachers, have said they support vaccine mandates, but that details should be negotiated locally.Nearly 90 percent of the nation’s educators are vaccinated, according to a survey from Education Week. Yet a small but vocal group of rank-and-file educators oppose vaccine requirements.
Pennsylvania slashes over 1,500 higher education jobs with union support – Last month, Pennsylvania State System of Higher Education (PASSHE) Chancellor Daniel Greenstein gave his stamp of approval for a plan that will lay off thousands of workers and reduce the quality of education at the PASSHE. The restructuring plan, approved on July 14, will merge six universities into two schools: California, Clarion and Edinboro on the one hand and Bloomsburg, Lock Haven and Mansfield on the other. It will lay off faculty members, reduce educational opportunities, and do nothing to alleviate the skyrocketing cost of tuition and the debt students will carry after graduation. In addition, the overhaul includes a wholesale reduction in staff and other cost-saving measures, sparing no school. According to a recent study conducted by the Political Economy Research Center at the University of Massachusetts Amherst, more than 1,500 jobs will be axed, including 809 faculty and over 600 staff. These huge layoffs will have a cascading impact on local economies, as these small-to medium-sized towns rely on the universities to survive. The PASSHE system comprises 14 public universities across the state and enrolls over 95,000 students primarily from working-class backgrounds, employing over 11,000 workers and faculty. Student enrollment has dropped by 21 percent since the 2008 financial crisis. The system lost roughly $52 million last year from continued enrollment declines and refunds issued to students who had refused to attend unsafe schools during the surge of the COVID-19 pandemic. The latest announcement will accelerate the crisis under conditions in which the pandemic is surging once again, with statewide daily new infections increasing by more than sevenfold in the past alone. Many comments noted the fact that Pennsylvania ranks 48th in the US in public expenditure on higher education, with the Democratic Party at the helm over the last two election cycles, while stressing the horrific, prolonged impact these cuts will have on the students who attend these schools.
The University of Texas at San Antonio opts to start fall classes remotely.— It is what many universities fear. After months of gearing up for a fall semester that seemed like normal, with in-person classes and packed football games, the University of Texas at San Antonio announced Wednesday that almost all courses will be held online for the first three weeks.The university’s president, Taylor Eighmy, notified the campus of 30,000 students of the shift, blaming a surge in Delta variant cases in San Antonio.Fully remote classes are something leaders of universities across the country hope to avoid this fall, after three semesters of pandemic disruption on their campuses.Yet, even as infections rise, public universities in Texas are denied the most potent tools to stop the spread – they cannot force students or staff to get vaccines or even wear masks. Gov. Gregg Abbott of Texas renewed his ban on vaccine and mask mandates in late July. As many as 20 Republican-led states forbid vaccine mandates in some form.While their public institutions are hamstrung, more than 500 other public and private colleges around the country have instituted vaccine requirements.”The goal of university presidents is to get shots in arms,” said Terry W. Hartle, senior vice president of the American Council on Education, an industry group. “But in deep red states, mandating a vaccination is likely to draw hard and fast battle lines.”
The Supreme Court won’t block Indiana University’s vaccine mandate. – The Supreme Court allowed Indiana University on Thursday to require students to be vaccinated against the coronavirus.Eight students had sued the university, saying the requirement violated their constitutional rights to “bodily integrity, autonomy and medical choice.” But they conceded that exemptions to the requirement – for religious, ethical and medical reasons – “virtually guaranteed” that anyone who sought an exemption would be granted one. Justice Amy Coney Barrett, who oversees the federal appeals court in question, turned down the students’ request for emergency relief without comment, which is the court’s custom in ruling on emergency applications. She acted on her own, without referring the application to the full court, and she did not ask the university for a response. Both of those moves were indications that the application was not on solid legal footing. The students were represented by James Bopp Jr., a prominent conservative lawyer who has been involved in many significant lawsuits, including the Citizens United campaign finance case. He argued that the university’s vaccine requirement was putting his clients at risk. “The known and unknown risks associated with Covid vaccines, particularly in those under 30, outweigh the risks to that population from the disease itself,” Mr. Bopp told the justices. “Protection of others does not relieve our society from the central canon of medical ethics requiring voluntary and informed consent.”The ruling capped a string of setbacks for the students in the case, which was the first to reach the Supreme Court concerning the coronavirus in the context of an educational institution. The court has previously ruled on many emergency applications arising from the government’s response to the virus in other settings, including houses of worship and prisons. A trial judge had refused to block the university’s requirement, writing that the Constitution “permits Indiana University to pursue a reasonable and due process of vaccination in the legitimate interest of public health for its students, faculty and staff.” A unanimous three-judge panel of the United States Court of Appeals for the Seventh Circuit, in Chicago, declined to issue an injunction while the students’ appeal moved forward.
IMF offers crumbs to poorer countries – To the accompaniment of overblown rhetoric and after months of haggling, the International Monetary Fund has agreed to try and boost the finances of low- and middle-income countries as they struggle to deal with the COVID-19 pandemic amid lack of access to vaccines and already inadequate public health services.Last week it signed off on a $650 billion expansion of its Special Drawing Rights (SDRs) program. SDRs have no conditions attached and do not have to be repaid, enabling countries to employ them without making compensatory cuts to public spending. But the decision will make little difference to the worsening situation confronting many countries as they face a continuing slowdown in the growth of their national income.This was acknowledged, at least indirectly, by the IMF itself in its latest update to its world economic outlook. It cut the forecast for growth for emerging-market and less-developed countries, reversing the trend that has prevailed over the past two decades and more.However, this did not stop IMF managing director Kristalina Georgieva from talking up the SDR expansion when she announced it.She said it was a “historic decision – the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis.”The SDR allocation will benefit all members, address the long-term global need for reserves, build confidence and foster the resilience and stability of the global economy. It will particularly help out most vulnerable economies struggling to cope with the impact of the COVID-19 crisis,” she continued.These claims are contradicted by the very structure of the allocation. The expansion of SDRs, the equivalent of newly printed money, will be allocated to the IMF’s 190 members in proportion to their share of the global economy. This means that only $275 billion will go to emerging and developing economies, with the rest allocated to the world’s major economies. Furthermore, it is estimated that only 8 percent of the new money will go to countries that are classified as “highly debt vulnerable.”
There’s yet another surge in shipping costs – FT Alphaville – The price of shipping goods from Asia to Europe has soared over the past year. But, over recent months, the rise has been particularly dramatic. Here’s a chart put together by Xeneta, an outfit that specialises in data on what it costs to book space on one of the 40ft containers across the world’s oceans: That’s about a $6,000 rise in shipping costs per container since the end of April.Not only has it become far more expensive to ship goods across the Indian Ocean and up the Suez Canal, the service has become poorer. Emile Naus, a partner specialising in supply chain management at consultants BearingPoint, says exporters are full of complaints: We have had numerous reports that containers are being left off vessels even after paying the high rates. This has certainly caused some customers to over supply products, to try and maintain stock levels in Europe. The result is that there will be an issue with warehouse capacity, and the bullwhip effect this will undoubtedly cause will actually lead to more uncertainty in shipping volumes well into 2022. According to project44, a data logistics outfit, delays on the China to Europe routes are rising too: In many manufacturing industries, the hurdles to making and distributing goods seen during the earlier days of the pandemic seem to have been overcome. Mark Dow, an independent macro trader who has a large following on Twitter, told us on last Friday’s Twitter Spaces that he now thinks the US has reached a point where rising Covid-19 numbers would do little to offset the economic rebound. The reason being that, by this stage, businesses have learnt to cope to the point where they could easily stomach the impact of rising caseloads.Yet what we are seeing on the Asia to Europe route may reflect broader inflationary trends across the market for ocean freight, especially since prices for freight going from East Asia to the US West Coast have also picked up in recent months.Indeed, month on month, the rise in freight costs has been 20 per cent – higher than for the European route (though the cost of shipping a 40ft container from Shanghai to LA is nowhere near as expensive as the journey from China’s East Coast to Hamburg or Rotterdam). Data, as before, via Xeneta:Lack of capacity remains an issue. But analysts think that one of the factors driving the trend of late is a rise in Covid-19 cases in China. Here’s Josh Brazil, vice president for marketing at project44:The fact that ships remain delayed and now Covid variant outbreaks in major Chinese manufacturing hubs are on the rise, indicates that there may be far-reaching down-stream consequences going into Black Friday and holiday shopping seasons . . . …One of the few givens in 2021 is endemic delays, and the fact that conditions can change almost overnight.The big question now is how big the reverberations of this intensification of the logjams we’ve seen throughout the pandemic will be. We’ve already seen some edginess in global stock markets. Will we start to see it having a material impact on goods production, or have firms become better at building up inventories? We shall find out in the coming weeks.
Germany declares Israel a high-risk travel destination amid virus surge – report – Germany has added Israel to its list of high-risk travel destinations, along with the United States and Turkey, due to a surging coronavirus outbreak, it was reported Friday. Montenegro and Vietnam are also now considered high risk by the German government, said the Reuters news agency citing the FUNKE media group’s reporting based on government sources. Travelers to Germany from high-risk countries are required to quarantine for ten days unless they are vaccinated against the coronavirus or have recovered from COVID-19. The self-isolation can be shortened to five days with a negative test. The downgrade will take effect on Sunday, with the exception of Turkey which will be delayed until Tuesday due to the large number of Turkish-origin residents of Germany. German Chancellor Angela Merkel is set to visit Israel this month but the trip has remained unconfirmed due to the coronavirus pandemic. In this March 30, 2021, file photo, German federal police officers check passengers arriving from Palma de Mallorca for a negative Corona test as they arrive at the airport in Frankfurt, Germany (AP Photo/Michael Probst, File) Last month, the US Centers for Disease Control raised its travel alert level in Israel due to rising coronavirus cases. Israel is now listed by the CDC at Level 3, the second highest, due to the rate of new daily cases per capita. A notice on the CDC website said travelers to Israel should be fully vaccinated and that anyone who is not should avoid non-essential trips.
Canada reopened its border to U.S. travelers more than a year after sealing it. – For the first time since March 2020, Canada on Monday reopened its borders to nonessential travel by U.S. citizens and residents who are fully vaccinated against the coronavirus. But the pent-up demand created by the shutdown did not lead to a surge in traffic from Americans desperate to again visit their neighbors – at least, not immediately. Midmorning Monday at the border crossing at The Thousand Islands Bridge at Lansdowne, in Ontario, private cars were outnumbered by heavy trucks, for which the border was never shut. And so far the border reopening is only one way. Late last month, days after Canada announced that it would reopen its border, U.S. officials made clear that they would not immediately reciprocate. “The United States is extending restrictions on nonessential travel at our land and ferry crossings with Canada and Mexico through Aug. 21,” the Department of Homeland Security said. On Monday, even with the relatively light cross-border traffic, delays were reported to be common. Some travelers proved less adept at navigating Canada’s new pandemic rules than others. At the Thousand Islands Bridge crossing, Tim Guinnane, who drove from New Haven, Conn., with a kayak on the roof of his Toyota Prius and a bicycle in the back, said it had taken him three hours just to reach a border guard. “That’s not like a violation of the Geneva Convention,” he said before going into the base of the tower to buy a bottle of water. “I just thought it’d be more like an hour.” Once he reached the border booth, Mr. Guinnane said, he was questioned by a border guard for only about five minutes. Like several other travelers, he attributed the long wait to Americans who had failed to upload proof of vaccination and a recent negative coronavirus test to a Canadian government app. There were also travelers who had neither and were turned back. The scene was similar hundreds of miles west at the International Rainbow Bridge that connects Niagara Falls, Ontario, and Niagara Falls, N. Y.
From France to Thailand, demonstrations against pandemic measures grow. –Protests around the world are growing once again, with hundreds of thousands of people in Europe, Asia and South America taking to the streets over the weekend to oppose their governments’ handling of the pandemic.Demonstrators turned out in cities across France and Italy to protest new measures requiring proof of vaccination or a negative coronavirus test to carry out many daily activities.In the fourth consecutive weekend of protests in France, the turnout swelled to its largest in the past month as more than 230,000 people across the country demonstrated against a new law, set to be enforced starting Monday, that makes health passes mandatory for many indoor venues, including cafes and restaurants.Protesters throughout Italy voiced their opposition on Saturday toa similar pass that was introduced in the country the day before, arguing that the measure infringes on their freedom. While rallies in some countries have been prompted by new restrictions, protesters in other nations are blaming governments for failing to act forcefully enough in the face of coronavirus outbreaks.
Thousands Protest Against France’s Coronavirus Health Pass As Stricter Rules Loom – Thousands of protesters took to the streets Saturday across France for the fourth consecutive weekend of rallies against a requirement for a new pandemic health pass needed to enter most businesses or use public transportation. The latest round of protests come after France’s highest court upheld the majority of a new law requiring the health pass and for health care workers to be vaccinated against the coronavirus. The court wrote that those provisions complied with the nation’s founding charter. According to a notice from the French government issued July 29, residents were required to “present a health pass to access leisure and culture venues and events bringing together more than 50 people.” Beginning Monday, the health passes will be required to enter bars, restaurants, and malls – and to access long-distance travel by plane, train or bus. The pass – championed by President Emmanuel Macron – requires proof of vaccination, a negative coronavirus test result in the past 48 hours, or showing that one has recovered from the virus for at least 15 days (but not more than six months). As France enters a “fourth wave” of the coronavirus pandemic, Macron hopes the new rules will encourage residents to be vaccinated and stave off the fast-spreading delta variant. Polls show most people in France support the health passes. In July, Macron also announced that health care workers were required to get vaccinated by Sept. 15 – or they would be banned from work and not be paid. The Associated Press reported that a largely peaceful crowd of protesters walked through the streets of Paris surrounded by police clad in riot gear. The protesters carried signs that read: “Our freedoms are dying” and “Vaccine: Don’t touch our kids.” Confirmed case counts were on a largely downward trend in April through June before sharply increasing in mid July. The nation has so far recorded more than 112,000 deaths that have been attributed to the virus. More than 36 million people in France, about 54% of the population, have so far been fully vaccinated. At least 7 million have gotten their first vaccine shot since Macron announced the health pass on July 12.
Italy: COVID ‘Green Pass’ needed for museums, indoor dining – Pompeii’s archaeological park is offering free swab tests, the Vatican Museums posted refund instructions and tourists whipped out smart phones to show QR codes along with admission tickets Friday as a new COVID-19 certification rule took effect in Italy as part of the government’s plan to rein in a summer surge in infections. A so-called “Green Pass” is now required to enter archaeological sites, gyms, theaters, indoor pools and the indoor sections of restaurants, bars and cafes. To obtain a certificate, individuals must show they have received at least one dose of a coronavirus vaccine approved for use in the European Union, recovered from COVID-19 in the past six months or have negative lab results from a test done within the previous 48 hours. The government announced the rule on July 22. Some 50 million of Italy’s 60 million residents had downloaded the certification by late July. Vaccine certificates issued by the United States, Canada, Japan and Israel will be accepted for tourists arriving from those countries. Certification not written in Italian, English, Spanish or French must be accompanied by a sworn translation. Along the sidewalk flanking Vatican City’s walls, visitors to the Vatican Museums – one of the world’s most popular attractions – got ready to show their cellphones to workers at the entrance. Visitors from France found the new Italian system familiar. Their country has already introduced entrance requirements even tougher than Italy’s since they also apply to outdoor dining, While many find it convenient to flash their Green Pass on a phone, paper certification is acceptable in Italy. The Vatican Museums website cautioned visitors to have an identity document handy so staff could “verify actual ownership” of the Green Pass. For anyone unwilling or unable to comply, the website offered instructions on how to request a ticket refund.
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