Is the stock market really the economy, or not?

 I figured this would be a good topic for a post on the anniversary of Black Tuesday in 1929.

First things first: I am not an economist. Everything here is my own opinion and is based on the References at the bottom.

Question: Is the stock market really the economy?

Short answer: No it isn't.

Slightly longer answer: No it isn't - mostly, but the reasons are subtle.

Long answer:

About 52% of Americans own stock either directly because they own mutual funds or individual stocks, or because they invest in a 401(k), 403(b), or an IRA. That means that nearly half of Americans DO NOT OWN STOCK AT ALL IN ANY FORM. So for nearly half the country, market movements have no direct impact on them at all.

AND the richest 10% of Americans (measured by net worth and income) own 84% of the stock.

AND "(A) Federal Reserve study (using data from 2016) found that only about one-third of families in the lower half of the income scale had stock holdings. In the next 40% of the income scale, about 70% of households held stocks, while households in the top 10% of the income scale had stock ownership rates above 90%."

So the more money you have, the higher the probability that you own stock. 88% of households with earnings of $100,000 or more owned stock, while only 19% of those earning $35,000 or less did (and that mostly in retirement instruments). 

In addition, less than half of Americans are invested in retirement accounts and less than 20% of Americans work for companies that offer defined-benefit pensions. And most households who do own stock own less than $5,000 worth of it.

BUT, when the economy heads south, as it did during the spring of 2020, and even though the stock market did drop (34%) initially, the stock market can still rise, partly because it's viewed by wealthy people as a good place to stash money. With interest rates near zero, savings accounts, CDs and bonds are terrible places to make money this year. The stock market is a way better bet.

So, the bottom line here is that when the stock market goes up or down, it doesn't really directly affect many people. People might be affected if the market goes down and some companies lay off workers or go out of business. But in 2020 most of these layoffs are in small businesses that don't have any stock for people to buy anyway. People may also be affected if the market goes up a lot and some companies start to hire or raise salaries. But what really happens when the market goes up is that companies either buy back their own stock to increase the value of the company (by further increasing the price of the stock), or they send the money to their executives and shareholders in the form of bonuses and dividends.  None of which helps most people, even the people who work for these companies.

To emphasize this last point, from the Washington Post article cited below:

"In the middle part of the 20th century, for instance, stock market returns and wages rose more or less in tandem. But starting around 1980, the dynamic shifted: Corporations began to prioritize paying shareholders over paying workers. Stock returns took off, while wages stagnated.

The disconnect between the stock market and the job market is especially acute right now. Per the latest available data, the unemployment rate remains more than double its pre-pandemic level.

The S&P 500, on the other hand, is just 5 percent lower than its February high."

In short, nearly 20 million people who were employed in February 2020 are still unemployed 8 months after the first market slide and economic downturn despite the fact that the stock market has pretty much recovered that initial 34% slide.

So if there is any connection between the stock market and the economy it's a very weak one and it is advantageous to a very, small fraction of the population.

References (where I got my data):

On why the stock market isn't the economy:

https://www.nytimes.com/interactive/2018/02/08/business/stock-market-is-not-economy.html

and

https://tcf.org/content/commentary/stock-market-not-economy/?agreed=1

and

https://fivethirtyeight.com/features/the-economy-is-a-mess-so-why-isnt-the-stock-market/

and (a recent article)

https://www.washingtonpost.com/business/2020/10/27/401k-retirement-stocks-trump/

On the percentage of Americans who own stock:

https://www.forbes.com/sites/teresaghilarducci/2020/08/31/most-americans-dont-have-a-real-stake-in-the-stock-market/#223fe2661154

On the effect of stock market moves on Americans:

https://www.nytimes.com/2018/02/08/business/economy/stocks-economy.html

On the wealth of Americans:

https://www.nber.org/papers/w24085?utm_campaign=ntw&utm_medium=email&utm_source=ntw

And, just for grins, here's an economist that thinks the stock market is the economy - sort of:

https://www.marketwatch.com/story/why-you-should-stop-saying-stocks-are-not-the-economy-11598295686

COVID Mortality Rates (UPDATED)

 So I've been in a small kerfuffle with some folks on Facebook over the mortality rate of COVID-19. Their contention is that it is vanishingly small - like .002%. My contention is that it is much higher - like 5 - 6%. Since I've been told by some folks on FB to "do your own research," here it is.

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Variables I use to compute the mortality rates:

Confirmed Cases: the reports of the total number of confirmed positive cases in the U.S.

Recovered: people who have a confirmed positive test and who have recovered from the virus (whether they were in the hospital, ICU, or not).

Deaths: well, yes. A confirmed positive case that leads to death. (Note that this can be tricky, since some death certificates which should read COVID-19 as the cause of death, instead read things like 'heart failure', pneumonia, etc. For example, my mother, who was a Type-1 diabetic, died of a heart attack. That's what's on her death certificate. But the heart attack was the proximate cause of her death. She really died from "complications due to Type-1 diabetes" which would have been a more accurate cause of death to put on the death certificate. The CDC and my other sources take these ambiguities into account when they produce death numbers.)

(Provisionally) Resolved: Since we're in the middle of a pandemic there are three types of COVID-19 patients. (1) those who've been confirmed positive, but whose cases have not yet resolved, (2) those who have recovered, and (3) those who have died from the disease. All three of these groups add up to the total number of confirmed cases.

Of those, the confirmed positive unresolved is the largest group; those are the people who have the virus but have not yet recovered or died. So we can't really count those people in a computation of the mortality rate because we don't know the outcome of their case yet. We can only count those whose cases have been "Resolved" in one way or the other. So we add those who've recovered to those who've died to get a single number of those whose COVID-19 cases have been resolved one way or the other.

This is why it takes the CDC several months to put out the annual report on seasonal influenza, how many cases, how many hospitalizations, and how many people died. To get a final number you have to wait until the number of new cases a week (or a day or a month) falls below a certain level, and all those confirmed cases have resolved before you can put out a final mortality rate for that year. For example, see the data for 2018-2019 here https://www.cdc.gov/flu/about/burden/2018-2019.html

So I use "Provisionally" Resolved because the number will change over time because we don't have the virus under control yet. This will cause the mortality rate to fluctuate.

Mortality Rate: MR = (Deaths/Resolved) it's the fraction of people whose COVID-19 cases have resolved and who have died from the disease.

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Here are the three sources of information I've been using in my research. I use them because they all have a history of doing this kind of analysis, they have been reliable in the past, and they are producing values that are pretty close together despite their being three separate organizations. Also, many other organizations (including the media) use their numbers when they report things to the public.

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Centers for Disease Control - COVIDView

https://www.cdc.gov/coronavirus/2019-ncov/covid-data/covidview/index.html

and scroll down to find "Severe Disease -> Mortality"

The CDC doesn't seem to report "Recovered" cases, just Deaths and Cases. (But if you can find a CDC website that does include Recovered numbers, please let me know.) So there's no way to compute the "Resolved Cases" number and hence the Mortality Rate. So we just have to take their word for it that this is the correct mortality rate for this week.

For week 38 (14 Sep 2020 through 20 Sep 2020) "the percentage of deaths attributed to pneumonia, influenza, or COVID-19 (PIC) for week 38 is 6.6% ... the percentage remains above the epidemic threshold and will likely increase as more death certificates are processed."

The CDC also lumps in pneumonia, influenza, and COVID-19 as reported on death certificates into a single number. Given that it's September, the influenza numbers should be very low. I can't say anything else more specific about this data.

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Johns Hopkins Coronavirus Resource Center

https://coronavirus.jhu.edu/map.html

As of 25 Sep 2020 about 2:23PM

Confirmed Cases: 7,019,232

Recovered: 2,710,183

Deaths: 203,329

Resolved (Recovered+Deaths): 2,913,512

Mortality Rate (Deaths/Resolved): 6.97%

This is the website that most people in the media and other independent organizations go to to get their data. These folks are really good at what they do and I'd trust their numbers any day.

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Worldometers.info website 

https://www.worldometers.info/coronavirus/country/us/

as of 25 Sep 2020 at 20:48 GMT (3:48pm CDT)

Confirmed Cases: 7,220,658

Recovered: 4,463,721

Deaths: 208,081

Resolved (Recovered+Deaths): 4,671,802

Mortality Rate (Deaths/Resolved): 4.45%

The folks at Worldometer have been around for quite a while and do a very good job of gathering and validating data. They also use a wide variety of sources to get their data. The folks at Johns Hopkins use Worldometer to help validate their own data. I'm not sure why their Recovered number is so much higher than Johns Hopkins, so that's an opportunity to do some more research.

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So as you can see, it looks like the mortality rate for COVID-19 is somewhere between 4% and 6%. Compare that to the mortality rate of the seasonal influenza virus which is about 0.2%. So the novel coronavirus is between 20 and 30 times more deadly than the seasonal influenza virus.

4% to 6% is a far cry from 0.002%.

Be careful out there and wear your masks!

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UPDATE: (And thanks to my friend Mike Murphy for providing the links used here.)

First, an article at the Our World In Data website titled "What do we know about the risk of dying from COVID-19?" by Hannah Ritchie and Max Roser, dated March 25, 2020 

Here's the link:

https://ourworldindata.org/covid-mortality-risk?fbclid=IwAR2DDpjV2N0BEDZC5zwDDrQ-fl2ieB65hvevzp_M-ZeqXqH55ACh9Y7A3UM

This is a good article that tries to define the different meanings of fatality rate from COVID-19 and clarify the definitions.

From that article I'll quote: 

"When some people are currently sick and will die of the disease, but have not died yet, the CFR (Case Fatality Rate = the number of deaths/number of confirmed cases) will underestimate the true risk of death. With COVID-19, there are many who are currently sick and will die, but have not yet died. Or, they may die from the disease but be listed as having died from something else.

In ongoing outbreaks, people who are currently sick will eventually die from the disease. This means that they are currently counted as a case, but will eventually be counted as a death too. This means the CFR right now is an underestimate of what it will be when the disease has run its course.

With the COVID-19 outbreak, it can take between two to eight weeks for people to go from first symptoms to death, according to data from early cases (we discuss this here).

This is not a problem once an outbreak has finished. Afterwards, the total number of deaths will be known, and we can use it to calculate the CFR. But during an outbreak, we need to be careful with how to interpret the CFR because the outcome (recovery or death) of a large number of cases is still unknown."

This definition is kind of the closest to my Resolved Cases definition above and makes the valid point that the fatality rate will change as the pandemic progresses and you won't know the final fatality rate until the pandemic is over (which I believe I said above).

Mike also provides another link from Johns Hopkins on Mortality Analyses: https://coronavirus.jhu.edu/data/mortality?fbclid=IwAR2oFYxbghmty3mGM56I2HYRc6QQtCqu9V6CbXiu5BPf6zYQLWFNJtVZOtg

The Johns Hopkins page gives several good graphs on, in particular, "case fatality ratios (the number of deaths divided by the number of confirmed cases)." 

Note that this is different from my fatality rate which is "the number of deaths divided by the number of RESOLVED cases." As noted above, I use RESOLVED cases because the pandemic is still ongoing and many of the current confirmed cases have not yet either recovered or died, so it doesn't make sense to me to include them in the denominator.

Finally, Mike shares a link from the research journal Nature, dated 28 August 2020, https://www.nature.com/articles/d41586-020-02483-2?fbclid=IwAR1r5WxYkOj8lm8qkOB7uvpgFiR3_X0IfArw2eCMR8vwBJE2Y1OR0BDtYqw

The article is titled "The coronavirus is most deadly if you are older and male — new data reveal the risks" and is by Smriti Mallapaty, who is the Asia-Pacific reporter for Nature News.

Mallapaty talks about a ratio "a metric known as the infection fatality ratio (IFR), which is the proportion of people infected with the virus, including those who didn’t get tested or show symptoms, who will die as a result." which is close to one described in the Our World in Data article described above. The main point of the article is that if you are male and/or over 50 your chances of dying from COVID-19 are way higher than if you're under 18. Something I think we've known for a while.

Aside from the definition of infection mortality ratio, this article really doesn't have much to do with the discussion in the original blog entry I wrote above, so we'll just leave that here.

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Please just listen to Dr. Fauci

So at 4:32PM CDT 2 September 2020 the numbers from https://www.worldometers.info/coronavirus/country/us for U.S. coronavirus cases & deaths are:

Confirmed Cases: 6,293,308
Deaths: 189,859
Recovered: 3,534,977

Now, if you divide Deaths by the sum of (Deaths + Recovered) you get
(189,859)/(3,724,836) = 0.0509
which is a 5.1% death rate. Not too bad, you say?
(BTW, the world death rate is just about 5% using numbers from the same source above. Also, we use (Deaths+Recovered) because we don't know the outcome of the rest of the positive cases yet. If we used Deaths/Confirmed Cases as Johns Hopkins University uses (see https://coronavirus.jhu.edu/data/mortality) then the death rate (what JHU calls the fatality ratio) is about 3%. This is still 15 times the fatality ratio of seasonal influenza.)

Let us look at the same numbers for the seasonal influenza virus. Many people (Mr. Trump included) have said that the novel coronavirus is no worse than the flu, so let's look.

From the official CDC web site at:
https://www.cdc.gov/flu/about/burden/2018-2019.html
(I used last flu season's data because all those numbers are complete and don't include any COVID-19 numbers.)

The case numbers and deaths from influenza are:
"CDC estimates that influenza was associated with more than 35.5 million illnesses, more than 16.5 million medical visits, 490,600 hospitalizations, and 34,200 deaths during the 2018–2019 influenza season. This burden was similar to the estimated burden during the 2012–2013 influenza season"

Unfortunately, the CDC doesn't tell us the Recovered cases, so we'll just use the medical visits as our denominator. So if you divide 34,200 deaths by 16.5 million medical visits you get
(34,200)/(16,500,000) = 0.00207
and rounding up, about 0.002
which is a death rate of 0.2%

So the COVID-19 death rate is about 25 TIMES the death rate of the seasonal influenza virus, at least in the United States. And we already have a vaccine for the influenza virus that millions of people take every year.

However, this doesn't say anything about how contagious COVID-19 is compared to the seasonal influenza virus. So lets look at that as well.

Here's a comparison of the novel coronavirus and the seasonal influenza virus from Johns Hopkins University. https://www.hopkinsmedicine.org/health/conditions-and-diseases/coronavirus/coronavirus-disease-2019-vs-the-flu

With respect to which virus is more contagious, here's what the CDC says
"While COVID-19 and flu viruses are thought to spread in similar ways, COVID-19 is more contagious among certain populations and age groups than flu. Also, COVID-19 has been observed to have more superspreading events than flu. This means the virus that causes COVID-19 can quickly and easily spread to a lot of people and result in continuous spreading among people as time progresses."
https://www.cdc.gov/flu/symptoms/flu-vs-covid19.htm

So, yeah, don't wear that mask. You'll be fine.

But maybe you should wear that mask - SO YOU DON'T KILL ANYONE ELSE, like your parents, your child's teacher, your neighbor, the checker at the grocery store, your spouse.

Look, I know that masks are uncomfortable. I don't like wearing a mask whenever I'm out of the house either. I don't like social distancing. I don't like not being comfortable going to restaurants or movies, or the theatre. But think about it this way; you're not wearing the mask so that YOU don't get sick, you're wearing the mask so that OTHER PEOPLE don't get sick. Until we have a vaccine the only way to stop this virus outbreak is to STOP THE SPREAD and the best way to do that on an individual level is to wear masks in public.

So please, listen to Dr. Fauci and wear the damn mask.

One last thing; for a very good and readable article on the "5 Things Everyone Should Know about the Coronavirus Outbreak" take a look at https://www.yalemedicine.org/stories/2019-novel-coronavirus/

A Few Observations on Venturing Out During the Pandemic - 4 months in...

Observations today on coronavirus/quarantine/masks/venturing out into the world in Galesburg, IL.

BEWARE! I did my daily walk earlier today. Usually, I pass half a dozen or so people in my walk around the neighborhood; we stay on opposite sides of the street. Most don't wear masks - I don't wear one while I'm walking, but I've got it with me - but we don't get anywhere near each other. Today, though, I saw (1) a group of four older folks (at least as old as I am), 3 women and a man, walking together in a compact group, no masks, and no social distancing. Yes, they may all be living together, but... (2) Later I was passed by a group of five bicyclists, all adults, no helmets, no masks, all riding pretty close together so no social distancing there either.

So apparently this loosening up in Illinois is getting a bit out of hand.

MEDIUM GOOD NEWS: We also went to Hy-Vee on Henderson this morning during "senior hour". Many folks there still can't figure out the one-way arrows for the aisles. Nearly everyone in masks; I just noticed one person without one. This time all the employees were wearing them - and correctly (like covering their noses!). Folks were trying to social distance; the dots on the floor near the cash registers are terrific and people seem to adhere to them. Hy-Vee seems to be pretty much done with their wholesale "let's move every item to a different aisle" mania of the last few weeks, so that may have helped. There were still a remarkable number of gaps in the shelves where they are out of certain items. Luckily, we were able to get everything we needed.

GOOD NEWS: In the last two days I've had two appointments (don't ask, but it's OK) at the Illinois Eye Center in Peoria. Here are their criteria: (1) just the person with the appointment is allowed in the building (so Diane had to sit in the car), (2) temperature checks at the door, (3) all the employees in masks, (4) plexiglass shields at the check-in/check-out desks, (5) clearly marked social distancing signs and floor thingees, (6) all patients in masks, (7) hand sanitizer available in the halls and in every examination room, (8) folks following you through examination rooms wiping stuff down as you leave. I felt very confident and safe. 

Stay healthy, everyone!

Mail-in Voter Fraud is (mostly) a myth

In response to a letter in the Galesburg, IL Register-Mail on Friday, 19 June 2020 in which was stated: "The narratives that mail-in voting is safe and that there is no fraud involved is demonstrably false." I would like to present several articles and references that provide context that refutes that assertion. I've not used references from CNN, AP, or MSNBC as some people apparently don't think those organizations are truthful.

There is a very good article from Snopes.com on May 26, 2020. They rate the claim of massive mail-in voter fraud as "Mostly False".
https://www.snopes.com/fact-check/mail-in-ballot-voter-fraud/

The Heritage Foundation finds 204 cases of Fraudulent Use of Absentee Ballots in all 50 states over the period from 1992 - 2016, more than twenty years of data. That is out of more than about 1 BILLION votes cast. See https://www.heritage.org/voterfraud/search?combine=&state=All&year=&case_type=All&fraud_type=24489 for the database. The Heritage Foundation defines FRAUDULENT USE OF ABSENTEE BALLOTS as "Requesting absentee ballots and voting without the knowledge of the actual voter; or obtaining the absentee ballot from a voter and either filling it in directly and forging the voter’s signature or illegally telling the voter who to vote for."

The Brookings Institution has an article on its web site: Low rates of fraud in vote-by-mail states show the benefits outweigh the risks by Elaine Kamarck and Christine Stenglein from Tuesday, June 2, 2020 that examines the Heritage Foundation database used in the report noted above. The Brookings report has an interesting table on the number of cases of mail-in voter fraud in the five states (Colorado, Oregon, Utah, Hawaii, and Washington) that used all mail-in voting before 2018. Their total from the Heritage Foundation database of mail-in voter fraud cases is at
https://www.brookings.edu/blog/fixgov/2020/06/02/low-rates-of-fraud-in-vote-by-mail-states-show-the-benefits-outweigh-the-risks/ Their conclusion is that while mail-in voter fraud does occur, the number of cases is infinitesimal.

There is also a good article from the MIT Election Data + Science Lab at https://electionlab.mit.edu/research/voting-mail-and-absentee-voting that discusses the history of absentee and mail-in voting. Note that the director of the MIT Election Data + Science Lab is Charles Stewart III, Ph.D., one of the authors of "The Hill" article below.

There is an article at "The Hill" web site (not known for its liberal leanings): Let's put the vote-by-mail 'fraud' myth to rest by Amber McReynolds and Charles Stewart III, from April 28, 2020. See
https://thehill.com/opinion/campaign/494189-lets-put-the-vote-by-mail-fraud-myth-to-rest This article also does an analysis of the Heritage Foundation database and comes to the conclusion that in the case of widespread voter fraud "This is simply not true."

Finally, here is a link to the Federal Election Commission's Twitter accumulation by one of the commission's members on mail-in voter fraud from May 27, 2020: https://www.fec.gov/resources/cms-content/documents/2020-05-27-ELW-Facts-About-Voting-by-Mail.pdf

In short, voter fraud of all types does exist, but is exceedingly rare and has not been shown to change the results of any election. Data is your friend.

The Social Security and Medicare payroll tax

The Social Security and Medicare Payroll Tax.

It funds Social Security and Medicare.

So, there have been recent suggestions that one way to help the economy during the current stock market slump and the coronavirus pandemic is to reduce the "payroll tax" that nearly everyone pays on earned income. I won't go into the politics of this, but I was curious how the payroll tax (FICA and MDCR on your paystub) contributes to the Social Security and Medicare systems.) So here's the result of my brief research. Enjoy.

The Social Security payroll tax is 6.2% of your gross pay for both employer and employee.
The Medicare tax is 1.45% each. (There is a surcharge for high-income earners, but we'll ignore that here.)

So the totals are 7.65% each for employer and employee (15.30% total for both). Note that this applies only to earned income. So your stock dividends and capital gains don't apply here.

The Social Security payroll tax income cap for 2020 is $137,700 (so neither the employee nor the employer pays the Social Security part of the payroll tax once the employee's gross salary is above this amount). This income cap goes up a little bit every year. In 2020 approximately 6% of all earners have income that is over the income cap amount and hence do not pay the payroll tax on any earned income over the $137,700 cap. (See https://www.ssa.gov/policy/docs/population-profiles/tax-max-earners.html )

There is no income cap on the Medicare payroll tax.

The payroll tax is what funds the ongoing operations of the Social Security Administration and Medicare. It is what provides the funds for my monthly Social Security benefit and my Medicare Part A premiums and some other Medicare costs. How does this happen?

Payroll taxes are used to buy special-issue U.S. Treasury securities for the Social Security Trust Fund. This happens daily. The SSA is paid interest on these securities by the federal government. (These securities are basically a loan from the SSA to the federal government.) In order to make benefit payments, the SSA sells securities from the Trust Fund. In 2017, the SSA bought $2 trillion worth of special-issue Treasury securities using the money it received from payroll taxes. The SSA also sold $1.156 trillion in securities to pay Social Security benefits.

Note that if the total amount of payroll taxes collected in a given year exceeds the dollar amount of benefits paid, then the surplus is retained by the Social Security Trust Fund - and the Trust Fund grows. Conversely, if the total dollar amount of payroll taxes collected in a given year is less than the dollar amount of benefits paid, then the SSA must reduce the amount of money in the SS Trust Fund to make up the difference - and the Trust Fund shrinks. So in 2017, because the SSA paid out less money in benefits than it took in in payroll taxes, the size of the Trust Fund increased. However, starting in 2021 the anticipated amount in benefits paid will be larger than the anticipated payroll tax revenues and the size of the Trust Fund will begin to shrink every year.
See https://www.ssa.gov/OACT/ProgData/fundFAQ.html
and
https://www.ssa.gov/OACT/TRSUM/index.html

It is anticipated that - if nothing is done to reduce or eliminate the rate of shrinkage - the Social Security Trust Fund will be exhausted by 2035 and in subsequent years the SSA will only be able to pay out about 76% of the expected benefits.

There are many ways to fix this, either by increasing income into the Fund, or by decreasing expenditures (aka benefits).

One way to do this is to eliminate the payroll tax income cap. If the payroll tax income cap is eliminated and everyone pays the SS payroll tax on their entire earned income, the Trust Fund will not be exhausted until about 2080. So that's one fix that is doable - make everyone pay the payroll tax on their entire earned income. Note that this only affects the 6% of earners that make more than the current income cap because the other 94% of earners were paying the payroll tax on their entire earned income already. See option E2.1 at https://www.ssa.gov/oact/solvency/provisions_tr2019/payrolltax.html

There are other proposed options that have various effects on the size of the Social Security Trust Fund. Many of them are considered not palatable by most people. The three options mentioned most often are (1) increase the payroll tax amount by several percent (so all people with earned income will pay more in payroll taxes going forward), (2) increase the retirement age by several years (which has the effect of reducing benefits to future retirees), and (3) decrease actual benefit amounts for future retirees by some percentage by changing the formula used to compute the PIA (the Primary Insurance Amount: your full retirement benefit at your full retirement age. See https://www.ssa.gov/OACT/COLA/piaformula.html and https://en.wikipedia.org/wiki/Primary_Insurance_Amount).

None of these options has a lot of support except in certain circles in Congress and some media outlets.

So, to get back to the original question about a temporary reduction in the Social Security payroll tax, here's my opinion, FWIW.

It's a really bad idea, for this reason: It will reduce the income going into the Social Security Trust Fund for this year.

There are a couple of consequences of this.

It will require the SSA to take more money out of the Trust Fund to meet this year's benefit obligations. I know, you say, but John, the Trust Fund is supposed to grow this year. Yes, except that those growth projections assumed the current payroll tax rate and were made before there were 39 million people who are now NOT paying the payroll tax for at least part of the year. At this point, by reducing the payroll tax for everyone else (which, BTW, will not help the 39 million unemployed people at all because they now have no earned income), there is even less money flowing into the Trust Fund, but there is still quite a bit flowing out (part of which is my monthly Social Security benefit payment). This will reduce the overall size of the Trust Fund, which will reduce the amount of interest income the Trust Fund earns - every year going forward.

And that will make the problem of the Trust Fund shrinking to zero even worse.

So, yeah, a really bad idea.

A Modest Proposal on running elections (in the USA)

A Modest Proposal on running elections

My current ideas on elections and how they should be run; a response to the current electioneering and all the stories about how dangerous and insecure voting machines are.

Stuff we should do with respect to elections:

Part 1: Things I think are popular and doable in the short run.

1. Paper ballots. Every ballot cast has a paper backup that is archived and can be used in recounts.

2. Universal voter registration. You get a drivers license and you're 18, you're registered. You turn 18 and you don't have a license, you're registered.

3. The ONLY reasons to remove someone from the voter roles are (a) they moved and they informed you of the move or they registered in a different district (yeah, that would require comparing voter rolls across districts; that may be iffy), or (b) they die. Specifically, you can't remove them just because they haven't voted recently.

4. Make election day a national holiday. Everybody gets off except for essential health & safety personnel (and maybe they also get time off to vote).

5. Every state and local district has at least one month of early voting for every election AND early voting is done every day of the week, including weekends AND there's more than one place in your district to vote. The last one is, of course, to make it more convenient for everyone to vote.

6. The federal government should allocate waaaay more money to states to standardize their electoral procedures, machines, and processes.

Part 2: Things I think should be done, but will take more time and/or support.

1. All source code for all voting machines should be open source and should be reviewed by acknowledged experts in software development and computer security before it is used. They should be contracted and paid for this by the federal government and their reports should be in the public domain.

2. All electronic voting machines should generate a paper backup ballot that the voter has the opportunity to review before they cast their final vote. The backup ballots should be saved at each polling place and then transmitted to the counting location. No electronic voting machine should be connected to the Internet.

3. NO Internet voting should take place until it is proven (yes, proven) that voting via Internet connected devices (smartphone, tablet, computer) is at least as secure as executing financial transactions over the Internet (your bank & credit card transactions, for example).

4. There should be state and federal election commissions to regulate and review all voting machines. All voting machines (including upgrades to the software) must be approved by their relevant commission before they are distributed for use.

5. All elections should use ranked-choice voting.

6. All election results that use electronic machines should be audited immediately after the polls close and the votes have been counted.

7. All voting precincts should use the same style of voting machine. (Having half-a-dozen different voting technologies is just silly.)

8. For any federal election there should be mandatory rules on process and machines at the federal level.

Part 3: Things not directly related to voting or voting machines that I think need to be done as well. (and probably won't)

1. U.S. national elections should be limited to 6 months before the actual election day. No candidacy announcements and no campaigning are allowed until inside that 6 month window.

2. No private monies should be spent on national elections. All the money should be allocated by the federal government. (Failing that, see numbers 4 - 7 below.)

3. There should be a cap on the amount of money a candidate can spend on the primaries, and another cap on how much they can spend on the general election. (Hey, the British kind of do this. See https://en.wikipedia.org/wiki/Political_funding_in_the_United_Kingdom)

4. Corporations should be forbidden from contributing to candidates or parties and should not be allowed to run political ads at all. (Corporations are NOT people and don't have First Amendment rights.) Labor unions and other special interest groups (Say, the Sierra Club or the NRA) should be treated like individuals where campaign contribution limits and timing are concerned.

5. All political action committees and super-PACs should be banned.

6. The equal access provision for broadcasting should be re-instated by the FCC for federal elections.

7. There should be a maximum amount of money any individual can contribute to a single candidate in the primaries and in the general election. Let's say something like $1,000.

That is it for now, but I'm sure you and I can come up with way more interesting and safe things to do for elections.

1969 - Fifty years ago

1969 - Fifty years ago

TL;DR

What a fantastic year.  For me, 1969 was just one of the best years I can remember. Here's why.

First, I'm really talking about the period from July 1969 through July 1970.

Why? Because it was a year of firsts for me. Many firsts, many interesting and mundane things that marked the year before I went to college.

----------------------------
* I turned 17 on 23 July 1969.

* 1969-1970 was my senior year in high school.
It was also my second year living in Pasadena, Texas. The high school I attended was Sam Rayburn Senior High School. It had 3,600 students, while my high school in New York - John F. Kennedy Catholic - had 600; a big change. At Kennedy I was in the middle of the pack of a bunch of Catholic students who were expected to excel by everyone, parents, teachers, peers. At Rayburn I was all of a sudden taking all advanced classes, labeled a nerd, and was the guy with the weird accent. I never really got used to living in Pasadena, or Texas for that matter, but being right near Houston and near the Gulf of Mexico made being there a bit better. There were a ton of things to do in Houston, and Galveston and the Gulf were less than an hour away, so once I had a car I could escape Pasadena pretty regularly.

* I got my first drivers license in the summer of 1969.
We'd moved to Texas in summer 1968, when I turned 16, but I missed the summer drivers education class. So, with my junior year high school schedule being full I had to wait an entire year to take drivers ed. The drivers ed car was an automatic and so it was easy to drive. The most 'fun' part was learning to drive on the freeways around Houston. Yeah, not that fun really. But I made it and passed drivers ed. The next problem was that I had to take my drivers exam in my mom's car and it was a standard shift so I had to learn how to drive a 'three on the column' and figure out clutching, etc. My mom took me to the parking lot of the high school football stadium (Yes, my high school had it's own football stadium. Texas, you know.) and taught me how to drive the standard transmission there. This was good because all the embarrassing stalls and jerky starts happened on the parking lot instead of in traffic. The only fly in the ointment was that in southeast Texas near the Gulf of Mexico there aren't any hills, so I had to wait till my mom moved back to New York to learn to drive that standard on a hill.

* I got my first car in the summer of 1969.
The car was a 1963 Chevy Corvair coupe with a small 6-cylinder engine and a 5-speed stick transmission. It was blue. Remarkably, it had seat belts, though no shoulder harnesses or head rests. I added head rests later which added to the cool vibe of the Corvair. Being a Corvair the engine was in the back. Two sets of 3 cylinders in two lines, each with a single-barrel carburator. Loved that car. I learned how to change the oil and do a tune-up on that car. I got my first set of tools for that car.

* In 1969 I took my first long road trip in the Corvair.
I was attracted to a woman in my junior class whose family had moved from Pasadena up to Tulsa, Oklahoma after junior year. My long trip was a drive from Pasadena to Tulsa in December during our Christmas break in 1969. It was the adventure of my teenage years. According to Google Maps it's just about 500 miles from Pasadena, Texas to Tulsa, Oklahoma. An 8-hour drive or so up I-45, US Route 69, and the Indian Nation Turnpike. I started right after Christmas, with the intention of spending a couple of days in Tulsa and then heading back. The drive up to Tulsa was pretty uneventful, as was my stay. Spending a couple of days with my friend and her sister cured me of my attraction and I was ready to go home. I started out early with cold weather and light snow in the air. By the time I was on the Indian Nation it was a blizzard and the road was pretty well snow-covered. Remember, I'd had my license for less than 6 months and had never driven on snow before. Also, snow removal in Oklahoma isn't as robust or efficient as it is in, say, Wisconsin. An hour or so into the drive I did a nice little 180-degree skid onto the median. Remember that "turn in the direction of the skid" thing? Well, it's a learned skill. Luckily, there wasn't much traffic - hardly anybody else wanted to drive in a blizzard - and I was able to get myself back on the road. Only to do a second 180 a few miles further down as the snow was turning to ice. I managed to get myself back onto the road again and proceeded down the Turnpike at about 15 miles an hour for a while. The Indian Nation Turnpike heads pretty much dead south from Tulsa, so an hour or so later I was out of the storm and the temperature had warmed up so it was just raining. Sometime after that and right before I was out of Oklahoma on US Route 69 near Atoka my Engine Overheating light came on. US 69 was a two-lane road that wound its way through some hill country in southern Oklahoma so there weren't many places to pull over. Getting desperate, I lucked into a wide space in the road that was created by the entrance to the Mack Alford Correctional Center. I pulled over, got out and opened up the engine compartment to discover that my fan belt was broken so the engine wasn't getting cooled (the Corvair had an air-cooled engine, so that fan was essential). I walked up to the entrance to the Correctional Center to ask if I could use a phone. The guard at the gate not only wouldn't let me use a phone, he told me to get out of the drive if I knew what was good for me. According to my map, there was a town about 5 miles south of me, where I  hoped I could find a service station. So fan belt in hand I started walking and managed to hitch a ride from a passing motorist who dropped me off at a station just on the outskirts of this town. My luck held and the station had the right size fan belt and I had enough money. Then I hitched back to my car and opened up the trunk to get out my tools. Only to discover that my brother had borrowed my toolbox and all my tools and had managed not to put them back before I left for Tulsa. So now I had a fan belt, but no way to put it on. Hoping that I could borrow a wrench at the service station I started hitching again. Miraculously, the first guy who stopped had tools and said I could borrow them to install my fan belt. Of course, he backed up from where he picked me up to where my car was parked and managed to hit my driver's side fender with his bumper. It was a small ding and I was already tired and still had a 6-hour drive ahead of me, so I waved him off, borrowed his wrench, installed the fan belt, thanked him and was off and running again. I did manage to make it home, where I retrieved my tools and put them back in the trunk. I haven't been back to Tulsa since.

* In 1969 I got my first real job.
My mother was graciously paying my car insurance, but gas and maintenance were all on me. So that summer of 1969 I got my first real job, sacking groceries at a Globe supermarket an easy walk from our apartment. I worked at the Globe full time during the summer and hung onto the job, working part-time after school started in late August. This kept me in gas money and let me buy my lunch in the school cafeteria every day. To save on parking fees I talked the owner of a convenience store that was right across the street from my high school to let me park next to his store during the day. How I managed to do this I no longer remember. The job at Globe was OK. I packed groceries for customers and after a few months also started stocking shelves. Despite the fact that this was Texas, I had to join a union to work at the Globe. I can't remember how much the dues were, but they couldn't have been much and the union membership got me a higher starting rate than the minimum wage, so it was all good. I worked at that Globe for most of my senior year, but quit shortly before graduation because I had too much else to do.

* I had my first car accident.
The Globe parking lot was also the site of my first traffic accident. The parking lot opened onto a busy four-lane street with no traffic light. So turning left out of the parking lot was always an adventure. One early evening in the fall of 1969 I was leaving the parking lot and turning left. There was a pickup truck in the rightmost lane turning into the parking lot and I thought there wasn't anybody in that next lane so I started my turn. Big mistake not waiting to look around the truck before turning. Because there was a car in that next lane and a second later there was a dent in my left front fender - the same fender that would be backed into in December in Oklahoma. The dent in my fender wasn't that bad, my car was still drivable. But the other car had managed to crack his radiator. Nobody hurt, and we got both cars back into the parking lot and called the police. First accident, the first time I had to show my insurance card, the first time I had to tell my mom about it.

* I learned to surf in the summer of 1969.
Another advantage of having a car was that I could drive to the beach. Galveston was a bit less than an hour from our apartment and gas was cheap in 1969. I loved going to the beach. In those days at the western end of Galveston Island you could drive out onto the sand and park. At the other end of the island if you took the ferry from Galveston to the Bolivar peninsula you could drive pretty much the entire length of the peninsula, 80 miles all on the sand. On Galveston island there were also several outfits that would rent you surfboards by the hour or the day. I'd roll down the windows, strap a surfboard to the top of my car and pick a spot somewhere along the seawall to park. I taught myself how to surf, mostly by watching other people and then trying to do what they did. In 1969 surfboards were longer and heavier than they typically are now and the waves in the Gulf of Mexico weren't that high. So it wasn't that hard to learn to stand up on the board and ride the small waves into shore. The rides weren't that long, but they were spectacular. The feeling of getting up and having the board flow through the wave was just really enormously invigorating. Many weekends I'd finish a Saturday late shift, hop in my car and drive down to Galveston around 11pm, spend the night on the beach and rent a surfboard as soon as they opened in the morning. I'd surf all day and head home exhausted and ravenous in the late afternoon. Occasionally my brother would go with me and once or twice a friend also hopped a ride. The freedom of being on the beach and catching waves was just wonderful.

* In my senior year I took AP Chemistry and met some people who would be friends for life.
At 17 I wanted to be a doctor. I wasn't sure why and I had no real idea what doctors did all day long, but I knew that they kept my mother alive (she was a very brittle Type 1 diabetic with all the problems that that degenerative disease brings), so that was my goal. The first step to meeting that goal was to load up on science and math classes. In my senior year I took Trigonometry and Math Analysis, a year-long physics sequence, and AP Chemistry called Chem II at Rayburn. Chem II was my favorite class, and not just because my teacher was a tall, very attractive 23-year-old blonde who'd just graduated from the University of Houston. Chem II was our homeroom and also our first-period class, so we had extra time with it every day. Wednesdays were our lab day, starting at 7:00am and running through the homeroom period and first period and we needed every second of that time. Since we were together so much of every school day, the 20 or so of us in Chem II became pretty close friends. Most of us were complete science nerds and so also had those Math and Physics classes together. Fifty years later I stay in at least some contact with a few of those folks. Some of them did become doctors (I didn't) or scientists or tech people, and many drifted off into other disciplines. But we all had good memories of Chem II.

* In 1969 I met my first real girlfriend.
What with being somewhat introverted and moving 2,000 miles between my sophomore and junior years of high school, I'd never really dated nor had a girlfriend. That changed about midway through my senior year when I met Sue. She was best friends with another woman - Susan - who was dating one of my Chem II buddies. Sue wasn't a science nerd but was kind and a good listener and we hit it off almost immediately. We dated the rest of senior year, went to prom, and hung out a lot. If I remember correctly, Sue's father was very protective, so our dates were many times constrained by parental rules. Our relationship continued into part of the summer of 1970 until I went up to New York to live with my father (more on that below). That next fall I went off to college and Sue stayed in Pasadena to attend the local community college. We had one last fling that next spring and then it was over. No regrets, no drama or histrionics. We just went our separate ways into new relationships. Still, she was the first, so thanks, Sue.

* I got accepted to college early in 1970.
I can't remember a time when I wasn't going to college. My mom talked about it when I was young and as high school hit it seemed like everyone was telling me about good grades and what classes I had to take to get into college. Nobody in my family had ever gone to college. My parents had not even graduated from high school - needing to work to help the family instead. So nobody knew the first thing about the process of getting into college or paying for it or what it was like. Also, this was 1969 so no internet, no Google, no web pages, no email. It was basically you, your high school guidance counselor, and whatever books you could find in the local library. Luckily for me I had done well on the National Merit Scholarship Qualifying Test; not well enough to earn a scholarship, but well enough to be inundated with literature from colleges that wanted students like me. That was the first part of my education about college. Getting out of Pasadena was a priority for me, so I devoured those brochures. I finally chose Lindenwood College II in St. Charles, MO. I chose Lindenwood for several reasons: first, they offered me a scholarship and work-study money. Second, it wasn't in Texas. Third, the II in its name was for the men's college that had just admitted its first students for fall 1969. The co-located women's college (Lindenwood College for Women back then) had 500 students; LC II had 100 men. I was hooked. Fourth, they had a computer that students could use. Being a child of the early 60s I was fascinated by the American space program and the race to the moon. One of the things that was hot at that time was all the computers that they used. This seemed like it would be a cool thing to learn.

* I saw my first R rated movie - MASH.
MASH is a black comedy, an anti-war movie, and pretty much my favorite movie of all time. Well, Casablanca might be number one, or they might just be tied. MASH was released in March 1970 and was an R-rated movie. Looking back I have no idea why it would have been R-rated at all. We were obviously all much more innocent and naive in 1970. Since I was 17 in 1970 I could go see it, and since I was living in Pasadena, Texas in 1970 I pretty much was on my own; my best friend Randy wanted to see it as well, but for some reason our schedules didn't work out. MASH is a terrific movie and I was suitably impressed. My 17-year-old brain could barely comprehend lots of the allusions and dark humor but I knew right away that this movie was "important." So I saw it like three more times that spring, the first time I'd ever gone back to see a movie more than once. I still watch it probably once a year or so.

* I got kicked out of class for protesting the invasion of Cambodia in May 1970.
This next story all probably happened because I'd gone to see MASH and was getting more interested in politics and the world around me. I can't say that I was really into politics in high school, nor was I a real political activist. But by early 1970 I was worried about being drafted and I was really ready for the Vietnam war to be over. I'd also just read "How old will you be in 1984?" a book of essays by and about high school student newspapers and free speech. The invasion of Cambodia in late April 1970 and the subsequent student protests lead me to want to do something. So I wore a black armband to school one day later in May. I didn't do anything disorderly and just went about my classes, but with the armband on. In 1970 in the Pasadena Independent School District there was a rule that students weren't allowed to "disrupt" classes. This happened to be a lab day in Chem II and while I was doing my lab work one of the assistant principals came into the classroom - disrupting it - and hauled me out of the room and down to the office. I was ordered to take off the armband, which I declined to do citing a recent Supreme Court case that asserted that high school students had freedom of speech (Tinker vs. Des Moines Independent School District, 1969). He didn't care and I was kicked out of school for the day and headed home. Thus my career of political activism started and largely ended.

* I spent the summer of 1970 living with my father for the first time since 1959.
My parents had gotten divorced in 1959 when I was seven years old. I'd not seen my father much except for my birthday and Christmas in all the intervening years. It wasn't because my mother wouldn't let us see him, it was that my father just wasn't really suited to being the dad of young children. He worked much better with older kids. So at the end of my senior year of high school I decided to go back to New York and live with my father for the summer before I headed to college. I sold my Corvair to pay for the plane ticket and showed up in Ossining, NY in early June (yes, he knew I was coming). My father was separated from his second wife and had a one-bedroom apartment in what passed for a high-rise in Ossining. He got the bedroom, I got the couch. It was an interesting summer. I listened to way too much Frank Sinatra music, my dad's favorite and a singer I learned to loathe. We must have hit every Italian restaurant in Westchester and Putnam counties. We visited my Dooley relatives whom I hadn't seen since we moved to Texas. And my dad helped me fix up a 1965 Chevy Greenbrier van (yes, it's a Corvair van!) so I could drive it back to Texas. On the way back to Texas, the van started burning oil big time. So much that I had to get off the Pennsylvania Turnpike, find a store and buy a case of oil so I could stop every few hours and put in another quart. I sold that van to my brother Michael in August so I could have money for books during my first semester at Lindenwood.

* I worked construction for the first time that summer of 1970.
When I got to New York in summer 1970 I didn't have a job. My father found me a job working off the books for a one-man stonemason operation. Dad would drop me off by the side of the Saw Mill River Parkway at about 7:00am every morning and my boss (whose name escapes me after 50 years) would pick me up. We'd go to the job site - it was the same large house somewhere in Westchester for the entire summer - and I'd mostly break rocks and mix mortar. We built a massive fireplace and chimney inside and out and a long rock retaining wall along the driveway. It really did take all summer. I got really good at hauling rock in a wheelbarrow and then lifting rocks up from one level of scaffolding to the next all day long. I really liked that job even though I was underpaid and the stonemason wasn't a particularly good or well-organized boss. The physical labor every day turned out to be fun; it gave me a chance to think a lot and I got to spend some of the lunchtime reading every day.

* I learned to drink beer - and like it.
The stonemason I was working for went out every day at lunchtime and bought a sandwich (I brought mine from home) and a six-pack of beer. He'd give me one and he'd drink the rest and then we'd get back to work. I can't recall what brand of beer it was, probably Schaefer or Rheingold, but I really hated it at first. But over the course of several weeks I started to like the tangy, somewhat bitter flavor and for the rest of the summer looked forward to that daily mid-day beer. One beer was enough to give me a little buzz and the back-breaking rock lifting was enough to sweat it out of me in short order. In 1970 the drinking age in New York was 18 and I turned 18 on 23 July. So for the rest of the summer I could go out to bars. That didn't happen very often because I didn't have the van till late in the summer and I was usually pretty tired after work. But it gave my father and me something to bond over. I also discovered that my father apparently knew everyone in upper Westchester and Putnam counties because every time we went to a restaurant he would know the owners and half the patrons. In every bar it was the same, my dad knew everyone. It made for easy introductions, but, of course, I was called the name I've always hated, "John Junior." So it goes.

UPDATE 01/02/2020:
* I was on TV for the first time. (How could I have forgotten this in the first post?!?!)
Senior year I was on the Sam Rayburn Prep Bowl team. Houston Lighting & Power sponsored this competition among the local high schools. The cool part was each contest (two teams at a time) was on the local TV station. I made it onto the Rayburn team along with Gene Thorne, David Gwyn (both unfortunately passed now, I believe), Danny Martinez, and John Beard. We did really well, winning 2 in a row before we were defeated by a team from Galveston. (They were really good.)