Kevin Drum

The American economy gained 142,000 jobs last month. We need 90,000 new jobs just to keep up with population growth, which means that net job growth clocked in at 52,000 jobs. The headline unemployment rate ticked down to 4.2%.

Employment numbers for the previous two months were revised downward, so we've now had three consecutive months of very meager job growth.

Average hourly earnings jumped 4.9% at an annualized rate while weekly earnings rose 8.6%. Average weekly earnings grew a stunning 15% in the financial sector. These are very strong numbers, especially considering that recent inflation readings have been under 1%.

Generally speaking, this jobs report shouldn't sway the Fed from going ahead with its rate cut this month. But the earnings growth might give it pause.

Vox points me today to a new paper suggesting the following sequence of events:

1. In 2006, a fungal disease called white nose syndrome starts killing off bats.
2. Bats fail to eat insects.
3. Farmers have to use more pesticide.
4. Pesticides kill babies.
5. Infant mortality goes up.

Here's the inevitable chart:

The researcher, Eyal Frank, found that insecticide use went up nearly a third—from 33 grams per acre to 44 grams per acre—in counties with outbreaks of white nose syndrome. In those same counties, at the same time as the surge in insecticides, infant mortality went up about 8%—from 6.8 per thousand to 7.4 per thousand—compared to counties that didn't increase insecticide use.

Correlation by itself is not causation, but in this case there's a pretty obvious causal mechanism available. There's probably something to this.

Just for fun, I want to show you what would happen if, against all odds, Donald Trump enacted a 20% tariff on all imports and it had no effect on the volume of imports. Here it is:

For example, in 2023 the federal government had a budget deficit of $1.8 trillion. Total imports—every car, every refrigerator, and every other physical object shipped into the country—added up to $3.1 trillion. Taking 20% of that nets you $600 billion. If every dollar of this was dumped into the general fund, the budget deficit would have gone down to.......

$1.2 trillion.

This is all ridiculous, of course. Even Trump couldn't apply 20% to everything, and if he did imports would drop significantly—which would reduce the tariff revenue.

Has any reporter ever asked Trump how much money he thinks his 20% tariffs would raise? Forget the details. Does he even know the simplest possible thing: how much we import and how much 20% of that is? Even Trump would have a hard time evading a question so straightforward.

OK, I admit that this is pretty amusing:

Trump is genuinely incoherent here. You really have to listen to understand how bad it is. As best I can make out, he's saying he'll raise so much money from tariffs that the federal deficit will go away and there will still be such vast sums left over that fixing child care will be trivial.

Sure. Ironically, the better answer is one that's political suicide:

There was a period in the '90s and aughts when the cost of child care really was rising faster than wages, but that hasn't been the case for over a decade. Since the end of the Great Recession, wages have risen considerably more than the cost of child care.

Nor is there a shortage of child care. The number of child care workers is higher than in 2019 and way higher than in 2012 (1.1 million vs. 850,000). Ditto for child care revenue ($16 billion compared to $11 billion, after adjusting for inflation). All while the number of children under ten has shrunk by 4%.

I'm all in favor of making child care easier and more affordable for families, but there's no crisis here. Trump could have said this if he'd known it. But needless to say, he doesn't have a clue.

This is a masked lapwing at the LA Zoo.

The BLS reported revised Q2 productivity today, and while I was fiddling around with it I came across a question I couldn't answer: how are we doing in the post-pandemic era? Here are your two choices:

If we assume linear growth before the pandemic, we're doing well. If we assume exponential growth, we're behind the curve.

I suppose this really ought to be modeled as exponential growth, which means our post-pandemic performance has been a little weak. All those robots and LLMs aren't having an effect yet.

I see that AH Datalytics has published the inaugural version of their Real-Time Crime Index, which provides rough estimates of crime within a couple of months of it happening. This contrasts with the FBI, which takes about six months to provide quarterly estimates and nearly a year to provide final annual figures.

What's more, the RTCI provides monthly data. For example, here's their estimate of murders over the past few years:

Does this give us any insight into why murder increased sharply in the spring of 2020? Maybe....

Up through April 2020—when COVID was already in full swing—murders remained at normal levels. They spiked in May when George Floyd was killed and then spiked further in June. But then they declined rapidly even though COVID was still surging.

So this suggests it was George Floyd, not COVID, that caused the murder spike. However, the annual summertime murder peaks have remained high for three years. It seems unlikely that the George Floyd effect could last that long, while the COVID effect probably could.

So it's still very difficult to say. If I had to guess, I'd say it was mostly COVID but with an extra little surge in 2020 when Floyd was murdered. It's just a guess, though.

This is the Belvedere Museum in Vienna. It was originally built as a palace, of course, but it never got used much. There were just too many other palaces in Vienna. Eventually, after 50 years of sporadic use, Maria Therese transferred the Imperial Picture Gallery to the Belvedere and it's been an art museum ever since.

Maybe I just read the wrong people, but I've sure seen a lot of chatter about Kamala Harris's proposal to tax unrealized capital gains. A couple of notes:

• The proposal is only for people with a net worth above $100 million. In practice it's really not a big deal.
• It's hardly unknown to tax unrealized gains. Your property taxes are based on the current value of your home even if you haven't sold it. Management fees for hedge funds are routinely based on the market value of gains, regardless of whether the underlying assets have been sold. Estate taxes are based on the fair market value of the estate's assets at the time of death. Nonqualified stock options are taxed when exercised, not when sold.
• Nevertheless, I'm not especially in favor of this. There are downsides to taxing unrealized gains, but the real reason I oppose it is that there's little point in creating a weird new tax just to hit the wealthy. At high incomes, income and wealth are almost perfectly correlated:
  .
  This means that if you want to tax the wealth of rich people, you can just establish a surtax on income above $1 million and accomplish nearly the same thing.

Why complicate things? If you think you have the votes for a wealth tax (which is what unrealized gains are), then you also have the votes for a new, higher income tax bracket for income over $1 million. So why not just do that instead?

The Wall Street Journal has this headline in today's paper:

How Immigration Remade the U.S. Labor Force

That's true enough, but it's also worth noting that it hasn't remade the workforce all that much—not recently, at least. Here's the number of foreign-born workers in the labor force:

This is all foreign born workers, both legal and illegal. It's currently exactly on its pre-pandemic trend, which suggests the recent surge in illegal border crossings has had little effect.

At the same time, it's worth noting that the share of foreign born workers has grown at an increased rate over the past year or two. This is largely because the number of native born workers has been pretty flat compared to just before the pandemic. This may be due to boomers retiring, but I'm not sure.