MR Daily Review
June 22nd 2022
1. At least 1,000 killed in Earthquake in Afghanistan.
A magnitude 6.1 earthquake struck Afghanistan Wednesday, killing at least 1,000 people with death tolls expected to rise. The earthquake struck the south east of the country near the border with Pakistan, hitting cities like Khost particularly hard. The response will be a test of the new Taliban government and will also highlight the outside world’s willingness, or lack thereof, to work with them. The damage is already devastating and assessments are still early and coming in so much of that work remains to be done and how well and effectively it happens remains to be seen.
2. Former treasury secretary Larry Summers says unemployment may need to rise as high as 10% to fight inflation.
Larry Summers says he saw inflation coming. What made Larry Summers unique is that he immediately called for the Fed to raise interest rates at the very idea that it could be possible we might start to get inflation. Raising interest rates will lead to a recession, especially because the Fed has engaged in a decades long saga of pumping as much money as humanly possible into the IV that is hooked up directly to capital’s arteries. Quantitate easing is a policy by which the Fed literally buys the bad debt of businesses that they want to sell. It has pumped trillions of dollars into the economy. This has happened essentially without pause since 2008. This was all fine, until we started getting unions, and Summers knows that the reason to hike interest rates doesn’t have anything to do with the high prices, it has to do with keeping the loose labor market that capital depends on. Summers wants to fight workers.
3.The average home in the United States costs 484,523 pieces of avocado toast.
Millennial Review Facebook commenter Jonathan urged us to “cut out avocado toast for 40 a month” and “buy a $15,000 beater home” to get started. I was just crunching some numbers. And according to the St. Louis fed, the average price of an avocado in the U.S. is $1.26, the average price of a loaf of wheat bread is $2.56. Assuming 12 slices in the loaf, and we’re eating the butt, and two pieces of avocado toast per avocado, we’re looking at .84 cents per slice of avocado toast. That puts us at 47 pieces of avocado toast a month to meet the $40 a month threshold. It also puts us at 484,523 pieces of avocado toast to meet the average home price in May of $407,000. And 17,857 pieces of avocado toast to match his $15,000 “beater house.” The problem isn’t avocado toast, it’s capitalism.
4. Joe Biden chooses Social Security privatizer to oversee Social Security Administration.
Joe Biden has a long history of at least being open to privatizing Social Security. Infamously during “the grand bargain” of the Obama administration, Biden was the point man working with Mitch McConnell for the administration trying to get Obamacare passed, and on the table were significant cuts and private carve outs for Social Security. So it should come as no surprise that Biden just appointed conservative Andrew Biggs, who has advocated for wholesale privatization, to the Social Security Administration Advisory Board. A career think tank ghoul who has long tried to ax Social Security now has significant oversight and power over the program. Great job Joe.
5. Inflation, gas prices, up in much of the world, not just the U.S.
Inflation and in particular rising gas prices are becoming a fundamentally important political issue in the United States. Much of the blame for the economic woes those higher prices causes falls on the shoulders of the Biden administration. Some of that blame is warranted, Biden is the president after all. But looking to the international situation shows that blame should at least be geared toward structural solutions and not just taking pot shots at the president. Inflation is up in much of Europe, particularly in the U.K., it’s also up in Canada, Japan, and South Korea. Gas prices are up universally as well. These problems aren’t unique to the United States and a Republican administration certainly won’t fix them.