I’m preparing to go to the polls to cast my vote. I’m old enough that there’s an “election day” rather than an election season.

I look forward to it with some foreboding. Given my track record my casting a vote for a candidate is practically proof positive that they’ll lose.

The elections I look forward to casting my votes for are for the president of the school board and the board member for our subdistrict. For Chicago that’s a first. There are three candidates running for board president, one endorsed by the mayor and the other two opposed to property tax increases and short term high interest rate loans. I think it’s actually an open question which candidate will win and I’ll be casting my vote for the non-Johnson candidate I think is most likely to win. My concern is that the two non-Johnson candidates will split the anti-Johnson vote and give the election to the candidate the mayor endorsed.

Update

I neglected to mention that I will be voting in the mayoral primary, too. The difficulty in that election is deciding among the several notables running who is the best and is not Brandon Johnson.

We did not have a single trick-or-treater last night. Not one. I think we can reasonably declare the practice officially over, at least in Chicago, at least in our neighborhood.

“Trick-or-treating”, i.e. wearing costumes and going door-to-door receiving candy, is a custom roughly 100 years old. Some attribute it to British or Scottish customs. Perhaps. It might be interesting to know the actual history of the custom.

In the 1930s there was an organized movement to promote it as an alternative to property damage and mischief. After a decline in the 1940s, it revived and I would say had its heyday in the 1950s and 1960s. Amusingly, when my late father-in-law would take my wife trick-or-treating he’d bring a martini glass with him, holding it out and saying “Trick or Treat!” with the kids. In a charming way he was a big kid himself.

But, as I say, the custom has gone out of fashion, at least here. Next year I won’t turn on my lights and I won’t buy candy to hand out.

At The New Republic via MSN Alex Shephard echoes a point I have been making for some time:

But that’s the problem. Trump has made billions of dollars during his presidency. He has worked to obscure his ties to Epstein, his late friend. He is mismanaging one ruinous war while appearing to help Russia fight another one. Those are just a few of the things that Democrats could pursue. It is fair to describe all of them as potentially impeachable. Indeed, any investigation into Trump’s conduct in office—whatever that conduct is—would likely produce impeachable offenses.

Harris’s idea that the party can simply run these investigations, uncover damaging evidence, and then—presumably—move on to other scandals is simply not plausible. The party’s base is fed up and insistent that Democrats “do something” about Trump and his cronies, which is to say that people want to see them stopped and punished. It’s hard to imagine that investigations alone will be enough to satisfy this bloodlust, even if Democratic voters know that there is no chance of convicting and removing Trump.

and concludes:

The squeamishness from establishment figures like Harris is understandable. It may even be reasonable. But it’s not plausible—the party’s base will not tolerate it, and the evidence the Democrats in Congress uncover will demand it. The fact that many Democratic leaders haven’t faced this reality yet suggests they still don’t understand the political dynamics of the moment. But it will dawn on them soon enough, and the likely result is that the only U.S. president to be impeached multiple times will see his record padded.

I don’t know what’s happening in states other than Illinois (and for two days, Alaska) but the political ads being run by Democrats not just for federal office but for local offices as well are primarily attack ads against Trump. How will newly-elected members of Congress, after running on opposition to Trump, avoid investigating and attempting to impeach Trump? I simply don’t see it.

At his Substack Ruy Teixeira makes the same point by asking Democrats eleven questions:

1. Do Democrats understand how much of their victory will be attributable to thermostatic reaction against the Trump administration rather than any confidence in the Democrats?
2. Are Democrats willing to stand up to the progressive/DSA left after the election?
3. Can Democrats effectively address “affordability”?
4. Can Democrats embrace bipartisanship and the permitting bill (BAAJA)?
5. Can Democrats find their way back to economic growth?
6. Can Democrats advance a coherent policy toward AI?
7. Can Democrats transition away from the energy transition?
8. Can Democrats articulate a viable immigration policy?
9. Will Democrats try to bring back DEI and affirmative action?
10. Will Democrats be able to move toward the center on trans issues?
11. Can Democrats embrace cultural positions that resonate with the working class?

Judging by the campaigns they’re running, the answers to all of those questions is “no”, as I presume Mr. Teixeira is aware.

My practice is to avoid commenting about countries or states of the Union in which I’ve never lived and about which I know little. My philosophy is better to remain silent and be thought a fool than to speak and remove all doubt.

In that light I think the best comment of the day is from Glenn Greenwald at X:

There are a bunch of ignorant American liberal pundits pontificating this week about Brazil even though they don’t know the first thing about any of the relevant facts or dynamics (Naomi Klein with Mehdi Hasan was so confused as to be comical).

Mr. Greenwald has lived in Brazil for the last ten years.

I don’t know enough about Brazilian politics to comment intelligently.

I also think it’s at least incautious to side with a “left-wing” or “right-wing” political party in another country because you, yourself, consider yourself “left-wing” or “right-wing”. Those labels don’t travel well. I’m reminded of the line from the satirical sketch comedy Beyond the Fringe comparing British and American politics:

Well, let’s see, you have the Republican Party, you see, which is the equivalent of our Conservative party. And then you have the Democratic Party which is the equivalent of our Conservative Party.

When I was out and about my errands this afternoon I saw a car I didn’t recognize. It looked like a Tesla but wasn’t identical. It had a Texas Manufacturer’s plate. No insignia or brand. Its rear window was opaque or, at least, you couldn’t see into the car from behind. It had no side mirrors. When we stopped at a red light, I asked the driver what kind of car it was.

“Tesla Cybercab”, he replied.

In their latest editorial the editors of the Chicago Tribune declaim that “the days of extraordinary public-sector union wage hikes must end”:

The budgetary backdrop for the county and the city has changed dramatically since most of the existing labor arrangements were negotiated in the hyperinflationary period immediately following the pandemic.

Do our political leaders actually understand that?

For example, city of Chicago workers generally will get raises exceeding 3% in 2027. Additionally, many of their union contracts tie their pay to the consumer price index, ensuring city workers’ compensation will not fall below the rate of inflation.

I wonder if the editors realize that these “cost of living” increases are themselves inflationary? That is true of all wage increases public or private unless the workers’ productivity has increased. Higher public wages are funded either by increasing taxes, cutting other spending, or running a budget deficit. If funded by deficit spending, it introduces new money into the economy, increasing aggregate demand without a matching increase in the supply of goods and services, which is structurally inflationary. The editorial seems to regard inflation protection for public employees as an ordinary contractual benefit while treating its cumulative fiscal consequences as extraordinary.

A significant question is how? The governor of Illinois, the mayor of Chicago, the president of the Cook County Board and most other major elected officials in Illinois either financed their own elections or depend on public employee unions to fund them. Said more bluntly they owe the unions.

Cook County Board President Toni Preckwinkle is, essentially, running without serious opposition for re-election. No Republican is running. A libertarian candidate few have ever heard of is running against her.

The “why” of the editors’ plaint is easy: the state, county, and city can’t afford it and neither can their residents. The how is considerably harder. How do elected officials restrain public employee compensation when the organizations representing those employees are among the political constituencies on which their careers depend? It’s the how our political leaders make that choice without committing political suicide that’s hard.

There’s quite a bit to comment on in David Malpass’s new op-ed in the Wall Street Journal. If his name doesn’t ring any bells Mr. Malpass is an economic analyst and former government official in the first Trump Administration. The op-ed is ostensibly a call for the Federal Reserve to update its “economic models” but I think there’s more going on in it.

The Federal Reserve’s outdated economic models and board structure are pushing it toward interest-rate increases that would hurt affordability and small businesses without curbing inflation. This approach risks keeping bond yields and mortgage rates higher than necessary while waiting too long to cut rates. Instead, the Fed should consider broadening its models to include the value of the dollar as a key factor in price stability, which would help deliver low inflation, fast growth and dollar dominance.

Perhaps his sharpest criticism is levelled at the Phillips Curve, the empirical observation that inflation and unemployment are inversely correlated:

Better data and analytical tools will help, but the Fed faces larger problems. Its old-fashioned models exclude the dollar even though its value significantly affects inflation and price stability. The models also assume that faster growth and wage gains cause inflation and that higher rates are the best tool to slow it.

It is hard to see how. Even with better data, inflation is a flawed guide to setting rates. It depends on factors beyond the Fed’s control, such as gasoline and diesel prices, and on liquidity in the economy from asset-price gains. Inflation also depends on the dollar and external supply factors such as energy production, deregulation, wage growth, tariffs, innovation, tax cuts and China’s pricing decisions.

When I took economics courses, the better part of a century ago, the Phillips Curve was taught as Holy Writ. When Congress defined the Fed’s “dual mandate” in the late 1970s, the Phillips Curve was still influential in economic thinking about the relationship between inflation and unemployment. Keeping prices stable while minimizing unemployment. Is the Phillips Curve actually obsolete? Or has the Federal Open Market Committee (FOMC) managed to thread that needle for the last 35 years? I don’t know and Mr. Malpass presents no evidence to suggest otherwise.

A fact I think that Mr. Malpass should take into consideration is that Paul Volcker’s success in curtailing inflation with high interest rates 45 years ago is the baseline, the standard of comparison. His actions were necessary due to the previous 20 years’ worth of bad fiscal and monetary policy, including excessive federal spending, accommodative monetary policy, and the disastrous experiment with wage and price controls, compounded by external shocks. Bad fiscal policy is the underlying cause of the present riots in France.

Here’s the kernel of his op-ed:

Bond markets are pricing in painfully high interest rates for the foreseeable future because of the Fed’s models. Hence the rise in bond yields and mortgage rates contributing to losses in the equity markets. Higher-than-necessary rates will also add significantly to the U.S. budget deficit given the size and short maturity of the national debt.

Is that true? The market is charging for risk, including fiscal risk and the consequences of Treasury supply, as well as forecasting the Fed’s rate path. Here’s the St. Louis Federal Reserve’s chart of 10-year Treasury rates over the last 60 years:

You may draw many conclusions from that but a conclusion you cannot reasonably draw is that bond rates are presently “painfully high”. They’re well below the extraordinary levels of the early 1980s but whether they’re excessively high today depends on inflation expectations, real interest rates, and the risks investors perceive. Mr. Malpass provides no evidence that the Fed’s models are responsible for those risks.

Here’s his conclusion:

A final point: Including prices and viewing growth as a positive factor in the Fed’s models would increase investor confidence in the dollar’s value and attractive returns on Treasurys. Linking the Fed’s price-stability mandate to a stable dollar would also solidify the dollar’s market share in the rapid growth of digital currencies and stablecoins. Dollar stability would, in turn, intensify pressure on China’s investment portfolio, which is underweight the dollar and overweight zero-yielding gold.

Would faster interest rate changes be an improvement over the status quo? I won’t argue that the Fed shouldn’t update its models. The question is to what end. I would argue that the Fed should keep its present mandate (stable prices and low unemployment) and eschew the “Greenspan put” (ensuring that asset prices rise). IMO what we face right now just as 45 years ago is the consequence of bad fiscal policy. That’s outside the scope of the Fed. The responsibility for that is with the Congress and, as we have seen, the executive.

Is Mr. Malpass really arguing for better economic models or is he arguing for models that will justify the policies he already favors?

On our last day in Alaska we visited the Iditarod Museum. That was of particular interest to my wife and me—we’ve been Iditarod Insiders for 30 years. We also took the opportunity to buy a few things in the gift shop. It was hard to pass buying decent quality hats and sweatshirts for a couple of bucks each. They were marked way down since they were commemorative of past races.

We had lunch that day with some other friends. They built their home themselves and, honestly, it was one of the most magnificent I’ve ever been in. Here’s the view from their backdoor:

We flew out of Anchorage at 9:00pm that evening and were back in Chicago at 7:00am Chicago time.

North to Alaska
Next Stop, Ketchikan
Port of Call: Juneau
Next Stop: Skagway
At Sea
Leaving the Ship
Visiting Wasilla

For the last ten years I have been saying that I didn’t understand Donald Trump. I don’t know why he does things. And I can’t simply trust that what he does will be the right thing. Those two reasons were sufficient for me never to vote for him. In his Wall Street Journal column Holman Jenkins presents his unified theory of Trump:

I find myself joking with die-hard Russiagate believers that their theory of Trump treason explains only half of Mr. Trump’s Russia actions. My theory explains 100%: Mr. Trump says and does whatever, in his cynical mind, he thinks will benefit Mr. Trump in the next five minutes. This is a universal theory of Trump behavior to which I have yet to find a significant exception.

That isn’t precisely “circular reasoning” but it’s close enough to it for government work. That sort of reasoning may be explanatory but I don’t believe it’s sufficient. It’s not predictive.