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Economy

The Pandemic Economy

Economists Carmen Reinhart and Vincent Reinhart write in Foreign Affairs that we’re in The Pandemic Depression: Although dubbed a “global financial crisis,” the downturn that began in 2008 was largely a banking crisis in 11 advanced economies. Supported by double-digit growth in China, high commodity prices, and lean balance sheets, emerging markets proved quite resilient…

Whitewater & Walworth County’s Working Poor, 2020 ALICE® Report

The 2020 ALICE® report, on those who are “asset limited, income constrained [yet] employed” is now available.  These latest data were collected before the recent recession – one can be sadly confident that hardship reaches farther now. For Wisconsin, 11% of households were below the poverty level, and 34% (including those below the poverty level) were…

A Key Difference Between Bristol, New Hampshire and Whitewater, Wisconsin

A sad story from April about Bristol, N.H. (population 3,300) reveals key differences between that town and Whitewater. While this new recession affects both communities, the economic hardship will be different.  See David Gelles, ‘This Is Going to Kill Small-Town America.’ Bristol depends on one major, private manufacturer: By the end of March, with just…

Built Against Substantive Change

Over time, no matter how small the city, national conditions and trends make their way to the edge of town. Some towns will address these conditions, but others will be resistant to substantive change. For those towns in the latter category, business as usual and rhetorical feints suffice in response to powerful forces to which…

Federal Reserve Chair Powell’s Interview on Economic Recovery

Last night, 60 Minutes broadcast an interview with Federal Reserve Chairman Jerome Powell in which Powell discussed current economic conditions and prospects for recovery. (Powell sat for the interview on Wednesday, 5.13.20 with Scott Pelley of CBS News.)  The interview is available online, as is a transcript. Below are excerpts from the transcript (although Powell’s…

Again – Consumer Sentiment

A story from the Wall Street Journal reminds that ‘re-opening’ is futile without broad-based consumer demand. Austen Hufford and Bob Tita report Factories Close for Good as Coronavirus Cuts Demand (‘Some manufacturers that furloughed employees during lockdowns say plants won’t reopen’): Factory furloughs across the U.S. are becoming permanent closings, a sign of the heavy damage…

Consumer Sentiment

Much of the ‘reopening’ advocacy rests on the idea that after allowing a business to reopen, that business will see an adequate return of customers. While some businesses may see adequate customer demand, it’s almost certain that others will not. It has never been true that simply opening a business would assure its survival. If…

Boosterism, ’30s Style

Although the Roosevelt Administration was (whatever its other mistakes) candid about the economic conditions it faced, there was in the ’30s, as there has been over the 2010s in Wisconsin, a delusional impulse to happy talk – regardless of economic conditions – among some politicians and some business groups. Margaret Bourke-White‘s Kentucky Flood depicts the…

The Reopening Debate Will Turn on Consumer Demand

The push to reopen Wisconsin will only effectively benefit retail businesses if consumer demand returns to pre-pandemic levels.  Consumer demand will only return to pre-pandemic levels if consumers feel safe.  Some retail demand will return as soon as shops and restaurants open; the marketplace question is whether consumer demand returns to something like pre-pandemic levels.…