“Free markets increase total wealth. Competition encourages entrepreneurs to find new ways to release more value from both people and resources.
Because capitalism is voluntary and consumers have choices, the only way capitalists can get rich is to offer us something that we believe is better than we had before.
That creates new wealth.
Steve Jobs became a billionaire. But by creating Apple, he gave us more: millions of jobs and billions of dollars added to our economy.
Research shows that entrepreneurs only keep 2.2 percent of the additional wealth they generate. “In other words, the rest of us captured almost 98 percent of the benefits,” says economist Dan Mitchell of the Center for Freedom and Prosperity.
“I hope that we get 100 new super billionaires,” he adds, “Because that means 100 new people have figured out ways to make the rest of our lives better off.””
“Colombia is the second most unequal country in an already unequal Latin America region. Even as its economy has grown in recent decades, the poorest slice of the population is not seeing those benefits, and many lower- and middle-income earners struggle to pay for basic services.”
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“unrest that has convulsed Colombia for more than a month. A tax reform bill proposed by right-wing President Ivan Duque sparked protests in late April, with thousands responding to a call from national labor unions to push against the measure.
The government defended the proposed tax increase as a much-needed measure to repair the economy after fallout from the coronavirus. Those who opposed the legislation saw it as putting another burden on middle-class and poorer families who are already in a precarious position, also because of the coronavirus.”
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“Columbia recently emerged from decades of internal armed conflict, the culmination of an imperfect and still not fully realized peace process. But this helped excise the civil war as the dominant political issue.”
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“The Colombian National Police is very much linked to the military; though a distinctive branch, it falls under the oversight of the Ministry of Defense. The force itself was shaped by the conflict in Colombia, with officers often fighting “on the front lines, wielding tanks and helicopters as they battled guerrilla fighters and destroyed drug labs,” according to the New York Times.
Critics have said the country’s national police needs to reform, moving from a focus on training for battle to one of public safety.”
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““They are treating the protesters as they used to treat the guerrillas, as subversives, because that’s the type of public force that is the police,” Restrepo said. “The military and security forces that we have, that was never reformed.””
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“The government has also alleged that some of the violence and chaos is the work of guerrillas, including the vestiges of the FARC, as well as drug traffickers who have infiltrated the protests. At the end of May, when protests had stretched on for a full month, Duque deployed the military to Cali, saying the increased capacity would help in the areas that have seen “acts of vandalism, violence and low-intensity urban terrorism.” Officials have also said hundreds of police officers have been injured, including by armed civilians.
Restrepo said the government is trying to bring the FARC guerrillas and Colombia’s conflict back to the center of the agenda “to justify the militarization of the police and the techniques that they’re using, the violence [and] brutality that they’re using.” In other words, when it works politically, go back to the us-versus-them paradigm.
This has further enraged protesters who see their legitimate grievances being ignored and their anger recast.”
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“Experts told me it would be a mistake to say all protesters, or even all blockades in cities like Cali, are associated with criminal elements. “That being said, you’re having this context of social protests embedded in a city, in a country where, of course, there are some powerful criminal organizations and guerrilla groups,” the Universidad Icesi’s Albarracín said. At least some of those groups will take advantage of the disorder — and the front lines are already so chaotic and disorganized, it’s hard to know who’s who.”
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“Protests are happening across Colombia, in cities including Cali, Bogotá, and Medellin. But this is not a fully unified movement. Up close, the protests all look very different, with diverse and often localized grievances — and not all of the demands are aligned.”
“Cuba’s economic problems largely predate the pandemic, but the coronavirus sharpened them. It decimated Cuba’s tourism industry, a huge slice of the island’s economy. Trump-era sanctions — which the Biden administration has not rolled back — have added to the pressure. And the pandemic itself is taking a toll: Cuba is currently experiencing a record surge in cases and deaths.”
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“Biden said the US supports Cuba’s “clarion call for freedom and relief.” Both Democrats and Republicans have backed the protests, but US lawmakers are split over how to approach the demonstrations and acute humanitarian crisis on the island.
Biden promised during his 2020 campaign to roll back Trump’s sanctions on Cuba, but he hasn’t acted. Now, the issue is urgent — both for those who want to see the sanctions gone and for those who feel Biden must keep them in place to continue pressuring the regime.
Biden’s best-laid plans on foreign policy didn’t include Cuba as a priority. But now a crisis in Cuba is here. What the US should do is always a complicated decision, but it’s clear Biden can’t just ignore Cuba.”
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“After the protests, Cuban President Miguel Díaz-Canel blamed much of the unrest on the United States, claiming US-backed mercenaries caused the unrest. He called on supporters to also go to the streets and “defend the revolution.” About 100 people were arrested, according to human rights groups.”
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“The specter of United States interference remains powerful in Cuba, given, well, a very long history of US intervention there. Fast-forwarding to the Cuban Revolution in 1959, communist revolutionary Fidel Castro overthrew the US-backed dictator and began to pursue closer ties with the Soviet Union — an absolute no-no for the US during the Cold War.
The US tried to overthrow Castro during the Bay of Pigs invasion in the 1960s, but after that failure, the US strengthened an economic embargo that largely blocked Americans from doing business or trade with Cuba. There have been tweaks on the margins since, but the embargo has long outlasted the Cold War.
In 2014, then-President Barack Obama began a historic diplomatic opening with Cuba, and as a result of the process, rolled back some economic restrictions tied to the Cold War-era US embargo and opened up travel.
Trump, as president, vowed to reverse those policies; he did throughout his time in office, significantly stepping up the pressure starting in 2019. He imposed renewed travel restrictions and other sanctions, including designating Cuba as a “state sponsor of terror” in his final days in office. A key pillar of Trump’s sanctions severely limited remittances to the island, which cut off another economic spigot.
As experts said, Cuba’s problems are deeper than US sanctions alone, but the Trump-era policy, especially coming during the pandemic, is adding to the strain. And that is creating a dilemma for Washington.”
“For some reason, despite the risks, millions of Russians are unhappy enough with Putin to go out in the streets and protest. The question is—why? And will it matter?”
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“Why did he think Russians were turning out like never before? Davidoff said that everyone he asked began with the phrase: “Well, I don’t agree with Navalny about everything, but …” I had heard similar comments. Then the speakers would continue with phrases like these: “But if they can treat Navalny this way, they can treat me this way.” “But it’s a matter of self-respect.” “But the corruption is out of control.” “But my bills keep going up and my pension stays the same.” “But my salary just disappears.” “But I’ve got to help support my parents.”
Whatever the motivation for each person, it was strong enough for them to risk physical harm, detention or even imprisonment to express discontent with the country and their lives.”
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“Russians really are having a hard time making ends meet. In Moscow, with its shopping malls, elegantly dressed population and boom of elite housing, it’s easy to miss.
It’s also not easy to see on paper. All the statistics seemed to indicate that Russia weathered the Covid storm better than most countries. At the beginning of 2021, data showed that the economies of European countries contracted about 7.4 percent in 2020 and the world economy was down 3.5 percent, while Russia’s economy contracted by only about 3.1 percent. Analysts at Moscow’s Higher School of Economics noted cheerfully that this was the first time in history Russia did better than the world average. This appears to be in part because the segments of the economy hit hardest by the pandemic—service sectors—are relatively small in Russia. The price of oil, Russia’s main source of income, did plummet for a while, but then it began to edge up again. Today it’s almost $70 a barrel, while the state budget is based on revenues of $42 per barrel.
But on the micro level it’s a different story. Household incomes are down 3.5 percent in the past year, and this is a deeper dip in a downward trend: Households are making 11 percent less in real terms than in 2013. From Dec. 1 to March 17 the price of gas jumped 18.5 percent. Food prices have risen by almost 8 percent from April 2020 to April 2021, and the government is paying 3 billion rubles (about $40 million) to subsidize the price of sugar. The government has even banned the export of buckwheat groats, a staple for Russian families in hard times, to keep the price affordable.
All of this means that none of my retired friends can live on their monthly pensions of 12,000 rubles ($164) without working or getting help from their children and families. And it explains why all of us have been living paycheck to paycheck.”
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“Corruption in Russia has always been a problem, but the conventional wisdom is that it seems to have gotten worse in the past two decades. First, my friends would tell me, they had to pay 15 percent in kickbacks on state contracts, but now it’s 35 or 50 percent. The saleswoman in a local household goods store told me how she and her husband had saved up enough money to buy the rights to a small press kiosk, but since it was at a bus stop and owned by the city, he had to get an official’s signature. Dressed in his best suit, her husband went into the office and explained what he needed. The bureaucrat replied, “Well?” My friend’s husband didn’t understand, and after a few questions back and forth at cross purposes, the official finally said, “Didn’t anyone tell you? My signature costs $50,000.”
Businesspeople also run the risk that a competitor will pay off someone in law enforcement to bring charges against them—and watch as the competitor takes over their business. Everyone resents the day-to-day corruption that makes life difficult, the money you pay in taxes or fees that disappears into someone’s pockets. You pay your apartment fees, but the management company doesn’t shovel the snow or wash the floor in the entryway or fix the hole in the roof. You watch workers change the curbstones on your street four times in three months. The trash cans in parks are overflowing. Getting your kids in the right school or right class costs extra.”
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“The government crackdown in recent weeks means life has changed dramatically for independent media and opposition political figures and activists. Dmitry Gudkov, once a member of the parliament who formed the opposition Party of Changes, packed up and left Russia on June 6 after being warned by sources in the presidential administration that otherwise a “fake criminal case would continue until his arrest.” On June 9, the Anti-Corruption Foundation was declared an extremist group, thus making all its employees ineligible for elections for at least three years—including, of course, in the upcoming parliamentary elections scheduled for September. For Russians who hoped for change through open media and elections, it felt like the end of an era in Russia’s political life.”
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“Albats points out that throughout Russian history, autocrats have been forced out only when they lose the support of the “elites”—which these days means the billionaires around Putin.
Which suggests that a crusader like Navalny, no matter how charismatic, and ordinary Russians, no matter how discontented, are unlikely to change that pattern.”
“One test is unfolding in Nevada in a fight over a planned lithium mine and a rare desert wildflower. A mining company, ioneer Ltd., has proposed building a large-scale lithium-boron mine in western Nevada (the first of its kind in the United States) to supply materials for electric vehicle batteries, wind turbines, and other clean-energy technologies. If approved, the mine could quadruple domestic lithium production and help build 400,000 electric cars each year, according to the company’s estimates, helping to advance Biden’s goal “to win the EV market.”
But a rare plant may stop the project from breaking ground. The site is also home to Tiehm’s buckwheat, a pale yellow wildflower that is only found on a 10-acre patch of lithium-rich soil within the project area. Last year, the Center for Biological Diversity, a litigious environmental group, sued the U.S. Fish and Wildlife Service, demanding emergency protections for the buckwheat to block the mine. On Thursday, in response to a court order, the service proposed listing the buckwheat under the Endangered Species Act. The Biden administration now has until September 30 to issue a proposed rule to protect the plant, which could all but doom the lithium mine.
It’s a familiar story: A tangled web of environmental laws and regulations gives litigious groups ample opportunities to stall development projects or thwart them altogether. That strategy works well when environmentalists’ goal is to stop things from happening, but it’s likely to be a major obstacle to building the infrastructure and technological capacity to achieve Biden’s clean-energy vision, which will require many new mining operations, solar and wind farms, transmission lines, and other forms of development.”
“Every time a credit card is swiped, the bank charges a fee. It seems trivial, but those fees add up — enough to help pay for rewards like points-funded hotel rooms and cash back. To compensate, businesses raise prices, and so cash users (who tend to be poorer) are often subsidizing the perks going to credit card users (who tend to be richer). And the higher the rewards, the bigger the cost to the unsuspecting people paying for it.”
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“Credit card rewards aren’t generally taxed like regular income, so to a certain extent, they’re even a bigger benefit than they appear on paper.”
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“Klein also said that interchange fees that go up with rewards cards can disproportionately impact small businesses compared to large corporations, many of which are often able to negotiate lower fees or strike deals with big credit card companies. According to the Wall Street Journal, Walmart, Costco, and Amazon have all been able to leverage their size and reach to bring down their fees.”
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” not all businesses accept all credit cards, or accept credit cards at all. American Express has the reputation of having high transaction fees that many merchants avoid. And the nice rewards cards often have higher swipe fees than more basic cards issued by the same company. But once a merchant says that they’re going to accept one brand of credit card, whether it’s AmEx or MasterCard or Visa, they can’t really discriminate among the cards under those brands. In 2018, the Supreme Court decided that credit card issuers were allowed to bar businesses from offering consumers incentives to pay with less expensive credit cards. Essentially, if a retailer accepts one type of AmEx, it’s going to accept all of them.
Klein says he thinks if merchants were more easily able to discern which rewards cards to take and which to avoid, some of the poor-to-rich transfer problem could be solved. “A reasonable way for the market to help solve this problem is for the merchants to be able to say, ‘I’m not going to take the Sapphire, the swipe fee is too high,’” he said. “The economist in me is like, the market can correct this to some degree.”
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“Another potential policy fix would be to lower interchange fees, which the Durbin Amendment, part of the 2010 Dodd-Frank bill, did for debit card transactions. If swipe fees for credit cards were capped, rewards would almost certainly diminish, too. But so would the regressive nature of credit card spending.”
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“For many people without credit cards, the problem isn’t that they don’t want one, it’s that they can’t get one because their credit score is too low or they don’t have enough of a credit history to get approved. It’s harder for the unbanked to build up savings, get traditional loans, or pay basic bills. And so they wind up losing money — they turn to expensive payday lenders that charge exorbitant interest rates and risk getting pulled into debt traps or resort to financial products that charge them more specifically because they have less. Rich people reap most of the benefits of the stock market’s rise, a rise that’s fueled by the productivity of workers.
To put it plainly, it’s expensive to be poor in America. And when it comes to rewards cards, it’s expensive to the benefit of the rich.”
“American consumers are bearing nearly 93 percent of the costs of the tariffs applied to Chinese goods, according to a new report from Moody’s Investors Service. Just 7.6 percent of the added costs of the tariffs are being absorbed by China, the investment firm found.
And it gets worse. When China responded to Trump’s tariffs by slapping new tariffs on many American goods, American firms paid a significant price. That’s because “U.S. exporters, unlike China’s exporters, lowered by roughly 50 percent the prices of goods affected by foreign retaliatory tariffs, carrying a much higher cost burden than foreign importers of goods under U.S. tariffs,” writes Dima Cvetkova, an associate analyst at Moody’s and author of the report.
In other words, American companies ended up on the losing end of the trade war both going and coming. Importers absorbed most of the cost of the Trump tariffs, and American businesses that export to China got hit by the retaliatory tariffs worse than Chinese exporters to the U.S. did.”
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“More than half of the goods traded between the world’s two largest economies are now subject to tariffs, according to PIIE data, up from less than 1 percent before the trade war began. The so-called Phase One trade deal inked by the Trump administration and Chinese government in December 2019 (there never was a second phase) barely had any impact on those figures.”
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“According to the American Action Forum, a free market think tank, Trump’s tariffs (and retaliatory tariffs imposed by other countries) have increased annual American consumer costs by about $57 billion. The Tax Foundation estimates that Trump’s tariffs amount to an $80 billion tax increase on U.S. businesses. And researchers from Columbia University, Princeton University, and the Federal Reserve Bank of New York concluded that the tariff costs “have been passed on entirely to U.S. importers and consumers.”
More than three years after Trump launched his trade war and four months after President Joe Biden inherited it, the consequences of the tariffs should no longer be subject to debate. The evidence is overwhelming and one-sided: American consumers are being hammered.”