Spin-In tech. The Army is partnering with the Pentagon’s internal startup accelerator to adapt small commercial drones—think hobbyists’ quadcopters—for the battlefield. The Defense Innovation Unit announced it will begin offering its expertise to the Army’s Short Range Reconnaissance program. [Jack Corrigan,.nextgov.com, Apr 29, 19] The difficulty comes when the Army writes a doctrine and instructions for use of technology that it did not develop. Nice idea; how do we use it, buy it, supply it, carry it, and service it? The Army's backpack is already overflowing and battery demnd is skyrocketing.
the biggest success of the Trump Presidency has been the economy. .. the “reformacons” on the right who derided deregulation and corporate tax cuts as an out-of-date agenda should admit how wrong they were. [Wall Street Journal editorial, Apr 27, 19] The braggarts over the recent economic growth conveniently ignore the contribution of putting hundreds of billions of dollars spent by the federal government on the national credit card of deficit finance (think a $trillion a year). With enough loans, anyone can look like an economic genius, even the self-styled "king of debt".
The CIA-affiliated venture-capital firm In-Q-Tel has nurtured many promising technology start-ups with seed money. But getting any technological innovations to take root inside the intelligence agencies has been a challenge, thanks to embedded contractors with their own financial incentives, bespoke and aging information technology systems, and sclerotic, risk-averse acquisition policies that make it exceptionally difficult for commercial companies, especially start-ups, to work with the government. [Amy Zegart and Michael Morell, Foreign Affairs, Apr 24, 19]
Innovation leaders often cite Eastman-Kodak as an example of an enterprise that was too dim-witted to see the writing on the wall and so fell from its lofty perch. But Kodak’s executives weren’t ignorant. They knew technology was changing and in fact invested billions of dollars in digitization. Kodak’s fatal problem was an inflexible organization that couldn’t adapt quickly enough to forces outside of its control. [Zachery Tyson Brown's All This ‘Innovation’ Won’t Save the Pentagon, DefenseOne, Apr 23, 19] Sounds like IBM's story with the PC.
China’s Subsidized Conquest of Trade. U.S. industry fades away as state-owned companies undersell the competition. [William Galston, Wall Street Journal, Apr 23, 19] Latest US victim industries: subway cars and 5G components. In the foreign competing countries, their people are paying taxes to the state to support the state subsidies to chosen industries, something not likely to be popular in tax-cut-merica. Trump is groping with a false sense of (smartest guy in the room) self-confidence to fix the problem while desparately concealing his actual financial track record to keep the sunshine from the magic.
Trump called Congress “very partisan.” [The Hill] Imagine that!
Faster pay, maybe. A bill introduced last week in the House of Representatives would accelerate payments to small businesses that do work for the federal government. The Accelerated Payments for Small Business Act of 2019 would direct federal agencies to disburse payments within 15 days of receiving a proper invoice if a specific payment date is not established, rather than the current 30-day standard. The bill impacts only small businesses. (Washington Business Journal) Nice thought, BUT, faster pay means more people, or more robots, to process AND VERIFY the claims.
More science, or else. It is hard to maintain leadership in any field with five decades of shrinking budgets. Science is no different—especially when your competition is devoting hundreds of billions, year after year, to beating you. ... The solution? America needs to do what it does best: compete. The U.S. has the world’s best research universities, a great scientific talent pipeline and a strong culture of innovation. Now Washington needs to invest more—much more [Alex Beam, Wall Street Journal, Apr 19, 19] Reaistically, every scientist sees a need for more knowledge but has little appetite to compete for political attention.
Not Nothing. A plausible title for the paperback editions that will soon be in bookstores might be, “We Didn’t Not Find Anything.” [Dwight Garner, reviewing the Mueller report, NYTimes, Apr 20, 19]
Brussels sets out $20bn list of US goods facing tariffs. [Jim Brunsden, Financial Times, Apr 17, 19] Tit-for-tat on tariffs truned out really ugly in the 1930s, an historical fact appaprently irrelevant to the White House's American-alone campaign for American isolation.
Semantic City. “I believe the government spied on the Trump campaign,” said Mr. Barr in a town where semantic directness is simply not practiced among the political pharisees and their pilot fish in the media who seek to preserve a certain order by obfuscating true intent. [Kevin Brock, TheHill, Apr 16, 19]
A President of [just] His People? The message seems clear and so does the audience: more red meat for red-state Americans who have been the foundation of his political enterprise since his against-the-odds campaign for the White House. [Peter Baker, New York Times, Apr 16, 19]
Being ahead of one’s time may impress posterity; it is no advantage at the polls. .... The authors blame it on voters who stress “hollow celebrity and contrived popularity” at the expense of “competence and rational judgment.” [Richard Norton Smith reviewing The Problem of Democracy By Nancy Isenberg & Andrew Burstein, Wall Street Journal, Apr 12, 19]
Don't need no outside advice neither. Pentagon officials are killing JASON in all but name.For decades, JASON studies helped DOD and other agencies get outside perspectives on scientific and technical topics. [Patrick Tucker, DefenseOne, Apr 11, 19] Just send DOD more money and cut soft stuff like food stamps, says Trump as America-alone fortress builder.
In the age of Trump, national politics is showbiz — self-righteous performance art to make the base feel good about itself. [David Brooks, NYTimes, Apr 11, 19]
When Impulse Rages. Secretary of Homeland Security Kirstjen Nielsen’s firing is the plainest example yet of the futility of trying to restrain Trump from inside—and the personal cost to those who try. [David Graham, The Atlantic, Apr 8. 19] The Founders foresaw such power grabbing and built checks and balances into the federal government structure. The federal judiciary, appointed for life, are demonstrating the check system to keep the executive within the law.
Up to $5 million of the $20 million allocated by ARPA-E under Design Intelligence Fostering Formidable Energy Reduction and Enabling Numerous Totally Impactful Advanced Technology Enhancements (DIFFERENTIATE) program, funding opportunity will be made available specifically for small businesses under ARPA-E’s SBIR. ...Submit trial balloon concept papers by May 20, 2019. [ARPA-E newsletter, Apr 5, 19]
Writing after the release of the Pentagon Papers, Hannah Arendt crystallized the essence of today’s obfuscatory media atmosphere: “Lies are often much more plausible, more appealing to reason, than reality, since the liar has the great advantage of knowing beforehand what the audience wishes or expects to hear.” [Alan Hirshfeld reviewing Robert Crease's The Workshop and the World, Wall Street Journal, Apr 5, 19]
Satire overwhelmed. The danger, of satire: not that it mocks and belittles respect-worthy pieties, not that it “punches down,” but that it has become impossible to separate it cleanly from the toxic disinformation that defines our era. [Justin E.H. Smith, philosophy professor, NY Times, Apr 5, 19] Free speech enables truth itself to be overwhelmed. with enough media and enough liars.
Tariff, the go-to tool. The Trump administration’s demand that punitive tariffs remain to ensure Beijing enacts genuine overhauls has emerged as one of the biggest sticking points as U.S. and Chinese trade negotiators opened new talks. [Bob Davis, Wall Street Journal, Apr 3, 19] Worked to punish everyone in the 1930s.
Lower taxes- gut IRS. A Hollowed-Out IRS Workforce Has Led to a 91 Percent Drop in Investigations of Non-Filing Businesses, [CAO says] The agency is ignoring even tax returns with obvious discrepancies because it no longer has the resources to follow up on them. [Eric Katz, govexec.com, Mar 27, 19] Only suckers pay taxes. -- Donald Trump, Sep 27, 2016
Puritanism as a political project failed, and for a host of reasons. The Bible is too big and complex a book to inspire a single doctrine of human government. Also, the Puritans’ intense work ethic tended to generate prosperity and markets, and markets are no place for narrow orthodoxy and severe morality. [Barton Swain revieiwng Michael Winship's Hot Protstants, Wall Street Journal, Mar 27, 19] Politicians and voters could take note that evangelicals' fervor for righteousness makes a poor base for practical governance.
Shrinking government. Key Federal Agency Doesn't Have the Staff to Oversee $35B in 2017 Hurricane Recovery Money. Slow process has led to four states and territories devastated by hurricanes receiving virtually none of the funds Congress appropriated. [Eric Katz, govexec.com, Mar 25, 19]
Pentagon: We're Buying Boeing F-15s to Keep 2 Fighter Makers in Business. ... The acting defense secretary's ties to the company had nothing to do with the decision, a senior defense official said. [Marcus Weisgerber, Defense One, Mar 25, 9] Oh, right.
Employees as commodities. Trump proposes to integrate the functions of the Office of Personnel Management into the General Services Administration, Defense Department and the Executive Office of the President, although much remains contingent on Congress approving legislation. [Erich Wagner, govexec.com, Mar 21, 19] Don't expect Congress to agree to remake USG into Trump Tower Inc with an arbitrary dictator.
All the federal government’s initiatives and resources around [AI] can now be accessed on one dedicated website, AI.gov, which the White House launched. [Brandi Vincent, nextgov.com, Mar 19, 19]
Governor Cuomo announced companies in 43North’s portfolio have created more than 400 jobs in Western New York. 43North is the startup competition that invests $5 million annually to attract start-up companies to Western New York and cultivate their growth in the region. Since launching the competition in 2014, 43North has invested in 44 companies. [43North press release, Mar 7, 19]
Include Us Out. U.S. semiconductor companies want no part of any trade deal that calls for stepped-up purchases from China. Washington has pressed Beijing to buy more than $1 trillion in U.S. goods and services as part of an agreement, and China has offered to buy $30 billion of U.S. chips over six years. But U.S. chip makers have told President Trump’s administration not to include them, Bob Davis reports. Why? Because U.S. production costs are so high, mandatory-purchase quotas would essentially force U.S. chip makers to open new factories in China and give Beijing bureaucrats more sway over the U.S. firms. [Jeff Sparshott, Wall Street Journal, Mar 19, 19]
Making government like a real estate biz. The Trump administration has long expressed a desire to make the federal non-salary compensation system more in line with private sector employers, who mostly have abandoned offering pensions to employees. .... “We believe it is the first step to eliminating any kind of defined benefit pension plan for federal employees,” [AFGE Senior Policy Counsel Richard] Loeb said. “Despite [the administration’s] claims to the contrary, they’re not doing this to enhance retirement benefits. They’re doing it to reduce their costs.” [Erich Wagner, govexec.com, Mar 15, 19]
President Trump is making the trade deficit bigger. "Pretty much anyone with a passing knowledge of macroeconomics could have predicted that this would be the likely result of moves by Trump and Congress to stimulate the U.S. economy with bigger federal deficits," Justin Fox writes at Bloomberg Opinion. "That Trump himself did not see this coming is another indication that, as someone recently said, the man doesn’t understand much about macroeconomics." [Jeff Sparshott, Wall Street Journal, Mar 14, 19] Or he simply has no connection to truth when spouting.
Trump warned Beijing he would not sign off on a trade deal that didn’t meet U.S. demands, Jong Un, Bob Davis, and Alex Leary report. ... a sharp departure from his recent optimism; it's not clear if they're a negotiating tactic or a sign of some underlying impasse in talks. [Jeff Sparshott, Wall Street Journal, Mar 14, 19] Unlike the US Congress Republicans, the Chinese don't worry about angering Trump's "base" who believe/hope in his omnipotence.
Prepare to prepare. (NSF) has instituted a new requirement that is going to affect everyone who wants to submit a Phase I SBIR or STTR proposal, starting immediately. And if you don’t react ASAP, you may well be precluded from submitting a proposal in the current solicitation “window” that ends June 13th—and you may even be precluded from submitting if you react quickly but not well to the new requirement. [Greenwood [SBIR] Consulting, Mar 12, 19] All agencies have a problem with piles of proposals with no chance of funding. Lots of work for the agency and lots of wasted work by the proposers. Meanwhile, Trump keeps trying to chop the agencies' workers. One solution is a clear agency message on what kinds of proposals have a reasonable chance. Help them and yourself - see what they fund, learn what they want.
Don't need no dadgum gummint. Thirty-five Congressional mandates sit unanswered, on everything from minimum seat space to secondary barriers protecting cockpits. The top job at the Federal Aviation Administration has been open for 14 months. Enforcement fines against major U.S. airlines have dropped 88% in the past two years, even as three-hour tarmac delays have more than doubled. [Scott McCartney, Wall Street Journal, Mar 12, 19]
Always about "me". Trump: Making daylight saving time permanent is â€˜OK with meâ€™ [AP News, Mar 11, 19]
The Army is all in on innovative startups, but it will likely rely on tried and true contractors to get the tech over the finish line, Lt. Gen. Eric Wesley told SXSW. [nextgov.com, Mar 9,19] As usual, the military wants new ideas that have been thoroughly tested. Advantage: established companies. But then, the Army could be at war tomorrow in any climate, especially with a loose-cannon President.
‘The comic thing about this drama is that no one is even pretending there is a real emergency.” So says Neeraj Kaushal, 57, a professor of social policy at Columbia who has just published a bracing book on U.S. immigration policy. Her thesis: Far from presenting an emergency, as President Trump contends, America’s immigration system is the best in the world. [Tunku Varadarajan, Wall Street Journal, Mar 8, 19] Except for Trump's view as he echoes his "base." Unfortunately, Trump is classic political theatrical exploiter of convenient myths. The real Trump is playing a character called Trump who is anti immigrant because thats what the voters in middle America want. [commenter, WSJ,Mar 9, 19]
Buy American goes to China. The Sichuan provincial government has stipulated that for 15 types of medical devices, hospitals will be reimbursed only for procedures that use Chinese-manufactured devices. [ELIZABETH C. ECONOMY, Foreign Affairs, Mar 6, 19] With Trump alienating all and sundry, China will look more and more attractive to other countries despite Xi's control fetish.
Anything Goes. When America, the world’s most influential democracy, has a leader without shame, who is backed by a party without spine willing to prostitute itself to Trump no matter how low he goes — and both are protected by a virtually state-run network without integrity, called Fox — it becomes a hunting license for leaders everywhere to go after their own domestic opponents and cross any human rights redline to stay in power. [Tom Friedman, New York Times, Mar 6, 19]
Hunkering down. DOE has drafted new restrictions on research collaborations between the scientists it funds and certain foreign governments suspected of trying to steal sensitive technologies. DOE officials are still debating the scope of the new rules. [Jeffrey Mervis, Science, Feb 15, 19]
Like Spain in 1796, the U.S. is at the apparent apogee of its power, consciously facing a post-hegemonic future but uncertain about how to proceed. Like the Spanish monarchy then, the U.S. today is riven between hostile constituencies—radical and reactionary, Christian and secularist—with no formula for reconciling them. [Felipe Fernández-Armesto reviewing Carrie Gibson's El Norte and Robert Goodwin's America, Wall Street Journal, Mar 2, 19]
Few law enforcement jobs are more coveted than the FBI’s special agent positions. But the tightest labor market in decades is forcing the bureau to aggressively recruit candidates. [Wall Street Journal, Feb 25,19] Consequences of a sleazy president attacking his own government.
Danger words. Trump claims "absolute right to .... " declare an emergency despite the clearly framed emergency law that allows Congress to stop such a declaration.
Five [DARPA funded] research teams will study the behavior of marine organisms to develop sensors designed to detect and track manned underwater vehicles and drones in strategic waters. [Jane Edwardson, GovConWire, Feb 19, 19] no small biz
limitless credit card.
It’s no longer cool to
talk about the
deficit. President Trump didn't talk about it during his State of the
Union. Neither did Stacey Abrams in her Democratic response. All told,
Washington’s red-ink alarms have gone dead, even though the annual
will pass the trillion-dollar mark starting in 2022. [Jeff
Sparshott, Wall Street Journal, Feb 19, 19]
The Trump Administration Can’t Get a United Front Against Iran [Defense One, Feb 19, 19] who would trust any Trumpian figure to act in the group's interest?
End the ending, prime the pump. Federal Reserve officials are zeroing in on a strategy to end the wind-down of their $4 trillion asset portfolio [Wall Street Journal, Feb 15, 19] national economic mirage relies on government debt boosting by posturing free-market politicians
The Army has activated an Artificial Intelligence Task Force on the Carnegie Mellon University campus in Lawrenceville, Pa., that is home to the National Robotics Engineering Center. The university has made many robotic advances, including creating flexible, soft and inflatable robots able to move over rough surfaces. What to watch: The task force is expected to spread to other institutions as the Army searches for cutting-edge advances in robotics and autonomous systems. [Association of the U.S. Army news, Feb 8, 19]
In the long run, a third or so of the country cannot effectively govern the other two-thirds with an unpopular agenda and a Twitter account. [Jonathan Rauch and Peter Wehner, NYTimes, Feb 8, 19]
Trump loves the new NAFTA. Congress doesn’t. and both Democrats and Republicans say it has little chance of passing without significant changes. [Jim Tankersley, New York Times, Feb 7, 19] Trump and any other aspirational leaders must face the reality that the US Constitution gives Congress the ultimate power in any disagreement. There is no binding Treaty until Congress ratifies it. And once ratified, it is the law of the land that the Executive Branch must adninister.
A. Ernest Fitzgerald, a [famous whistle-blowing] Pentagon official tasked with analyzing project expenses died at 92. At one point he noted that any high cost Pentagon system was a bundle of overpriced spare parts flying in close formation. He served in an isolated office, with secretary, from 1970 to 2006. He also cited as Fitzgerald's law that “There are only two phases of a program. The first is, ‘It’s too early to tell.’ The second: ‘It’s too late to stop.’ ” [Harrison Smith, Washington Post, Feb 7, 19]
Money does not spend itself. A new study released by the Senior Executives Association paints a dire picture of the federal workforce, one that is stretched too thin, hampered by old technology and the target of partisan attacks. Without a significant overhaul, agencies may fail to provide adequate services when they are needed most, the researchers found. [Erich Wagner, Government Executive, February 5, 2019] Since 1960, 15% more employees and 400% more money to be spent. Polticians love to demand more from government while shrinking it and its pay rate.
Startup Act reintroduced, would expand federal innovation support. Senators Jerry Moran (R-Kan.) and Mark Warner (D-Va.), co-signed by Senators Roy Blunt (R-Mo.) and Amy Klobuchar (D-Minn.), re-introduced the Startup Act today. The bill would enact an array of innovation policies, including reauthorizing Regional Innovation Strategies, creating a new commercialization grant program, and implementing a startup visa. SSTI has endorsed the bill and hopes to see the legislation passed by the 116th Congress. Read more. Sounds good to politcians, BUT, who would fund it, run it, and on what criteria?
Miracle cancelled.. [Taiwan] Electronics giant Foxconn reversed course and announced that the huge Wisconsin plant that was supposed to bring a bounty of blue-collar factory jobs back to the Midwest — and was lured with billions in tax incentives — will instead be primarily a research and development center staffed by scientists and engineers [for college graduates]..... company originally planned to build high-tech liquid crystal display screens in a project President Donald Trump had proudly pointed to as a sign of a resurgence in American manufacturing. ... because the  global market environment has shifted. [AP, Jan 30, 19]
"They are wrong! Perhaps Intelligence should go back to school!" [Twitter-in-Chief]. Sen. Mark R. Warner (D-Va.), the vice chair of the Senate Intelligence Committee, also weighed in. “The President has a dangerous habit of undermining the intelligence community to fit his alternate reality. People risk their lives for the intelligence he just tosses aside on Twitter.” [WashPo, Jan 31, 19]
Fantasy exposed, again. “A large majority of respondents—84%—indicate that one year after its passage, the 2017 Tax Cuts and Jobs Act has not caused their firms to change hiring or investment plans,” said Kevin Swift, president of NABE and chief economist at the American Chemistry Council. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jan 29, 19] Trickle-down benefits of tax cuts for the wealthy remain a fantasy.
at the annual meeting of the National Tax Association in November 2017, one of the keynote speakers began his remarks by asserting that if one set a monkey in front of a typewriter and, after some period, saved only those parts of what had been typed having to do with tax reform, the resulting tax law would be better than what the Republicans were poised to legislate. The speaker was Harvard economist and former Secretary of the Treasury Lawrence Summers. [Joel Slemrod, J Economic Perspectives, Fall 2018] Taxation always suffers from the political fantasy that what the present power group wants would be good for everybody. One-year economic returrns say that the critics were right.
Tell us that tale again. Trump advisers lied again and again, Mueller says. The question is, why? [WashPo, Jan 27, 19] Let's consult our mirrors for the culprit as we insist our politicians and the media tell us what we want to hear. That tax cuts will boost everyone's economic health, that a concrte wall will stop narcotics, opiods, and hard-working immigrants. And the internet lets us choose our own supporters and echo chambers.
New data from the U.S. Chamber of Commerce suggests the extended government shutdown is having a significant adverse effect on 41,000 small businesses across all 50 states. Small government contractors have lost $2.3 billion in revenue thus far 34 days into the shutdown, with another $29 billion at risk if the shutdown continues, Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce, told reporters. [Frank Konkel, NextGov, Jan 24, 19] Small biz thinking about who has responsible attitude for election 2020?
Trump fore-runners. Conflict of Inerest. George Washington was a stockholder when the [Bank of England] was financing the war to put down his rebellion. ..... Ready, fire, aim. The charismatic Montague Norman, is attributed with a large role in the development of the ‘“mystique” of the central banker’. He hated experts, and preferred to make decisions by instinct, turning to economists not to tell him what to do, but to supply explanations for things he had already done. [Jamie Martin reviewing David Kynaston's history of the Bank, LondonRB, Jan 24, 19]
Russia Says He’s a Spy. His Lawyer Says He Just Wanted Photos of a Cathedral. [New York Times, Jan 23, 19] Rule: avoid places without rule of law, or you could become a trading asset. .
Eden no more. Sir David Attenborough [long time naturalist] has warned that “the Garden of Eden is no more”, as he urged political and business leaders from around the world to make a renewed push to tackle climate change before the damage is irreparable. [Grahame Wearden, The Guardian, Jan 22, 19] as Greenland’s enormous ice sheet is melting at such an accelerated rate [more than 400 billion tons per year] that it may have reached a “tipping point,” and could become a major factor in sea-level rise around the world within two decades, scientists said in a study [just] published .[John Schwartz, New York Times, Jan 21, 19]
The Pentagon’s out-there-thinking department, DARPA, is working on autonomous attack swarms more like a murmuration of starlings than a formation of fighter-bombers. What human operators could co-ordinate such dynamics? [The Economist, Jan 18, 19] Note: DARPA is required by law to put 3% of its external contracts into SBIR, and looks for novelty; why not for you, out-there-thinker with swarm control ideas.
Trumponomics disappoint. The tax-cut steroid wore off within six months of its passage. Corporate investment rose at a 10% annual rate in the first half of 2018 but then slowed to 2.5% in the third quarter. According to the Institute for Supply Management, new orders for manufacturing equipment plunged 11 points in December. The logical explanation is that corporations won’t invest unless they expect an adequate return on such investments. That return depends on there being enough buyers for the goods and services they produce. But there aren’t enough. [Robert Reich, The Guardian, Jan 18, 19] No matter: Trump's base doesn't read eonomics, they just applaud his atmospherics.
Lessons Learned. The Army published a study of the U.S. war in Iraq that criticizes decisions of some of the service’s most senior officers and outlines hard-learned lessons from the conflict. [Wall Street Journal, Jan 17, 19] The Army believes in learning lessons from its adventures.
The [SBA] has stopped approving routine small-business loans because of the shutdown. The result: Business owners are halting plans for expansion and repairs, and considering costlier sources of cash, Ruth Simon reports. [Jeff Sparshott, Wall Street Journal, Jan 17, 19]
Re-launch the viewgraphs, and now power-points. the new[Trump announced] missile-defense strategy rests most of its hopes on other technologies that essentially do not exist, and may never do so. The review says, for example, that the F-35 Joint Strike Fighter could be networked with new sensors and outfitted with new missiles to take out adversary missiles on the launch pad. Tests have shown that the F-35 can do this. But the jet has to be in the enemy’s airspace already. [Patrick Tucker, DefenseOne, Jan 17, 19] We have added defense with the Trump reality show.
by being so brazen and uncooperative during its rise, China has actually activated the antibodies that will help prevent its success. [Kori Schake, in her book Safe Passage, 2017] a lesson to be recognized about the Trump adninstration, if not within
Lipstick for the pig. U.S. officials are debating ratcheting back tariffs on Chinese imports as a way to calm markets and give Beijing an incentive to make deeper concessions in a trade battle that has rattled global economies. [Wall Street Journal, Jan 17, 19] Expect such a concession to be touted as one step back to take two steps forward.
If not evidence, what? We're pleased to release a new evidence report as part of our Straight Talk on Evidence initiative. The report—"FDR’s call for 'bold, persistent experimentation': An antidote to 40-year stagnation in key areas of social policy (part two in a series)"—is posted on the Straight Talk website. Straight Talk on Evidence is an initiative of the Laura and John Arnold Foundation's (LJAF) Evidence-Based Policy team. [Jon Baron, VP of Evidence-Based Policy, Laura and John Arnold Foundation] Jon was a House staffer on SBIR and then an imaginative head of DOD's SBIR office in the Clinton Years.
What price glory, for a Wall? Federal contractors can’t count on receiving any compensation for lost labor. With nine of the 15 major federal agencies unfunded, some federal contractors and their employees are taking drastic measures to try to stay afloat. Low- and middle-wage workers are looking for new jobs, small- and medium-size firms have stopped paying employees and may have to fire some people, and the financial institutions that support those companies are assuming greater risk, Andrew Duehren reports. “How long can it go on? We’re counting the days until we’re out of business.” —Gary Shumaker, president and CEO of C2 Solutions Group. ... President [glory-seeking] Trump's top economic adviser said the broader impact of the shutdown remains fairly limited [Jeff Sparshott, Wall Street Journal, Jan 15, 19] The President doesn't need his salary, and his staff dare not speak truth.
Modern science depends on money, institutions and oodles of brainpower. Partly because its government can marshal all three, China is hurtling up the rankings of scientific achievement. An analysis of 17.2m papers in 2013-18, by Nikkei, a Japanese publisher, and Elsevier, a scientific publisher, found that more came from China than from any other country in 23 of the 30 busiest fields, such as sodium-ion batteries and neuron-activation analysis. [The Economist, Jan 12,19]
Yesterday's Solution.The Trump administration is readying guidance that could let states remodel their Medicaid programs to more closely resemble block grant proposals, according to people familiar with the discussions. [Wall Street Journal, Jan 12, 19] Republicans love to propose block grants that would transform the idea of a United States into the original idea of confederation of states. The people who hate the federal income tax seek the same backwalk without admitting the reality that led to federal direct taxation. Perhaps SBIR could also evolve from a national competition to a formal fair-share program. Why all this talk: today's problem was yesterday's solution.
Discussion. Trump's Day: The president meets with state and community leaders at the White House this afternoon to discuss border security. [Jerry Seib, WSJ, Jan 11, 19] Look for the conventional Army idea: If I want your opinion, I'll tell you what it is.
La meme chose. Although he had little understanding of the challenges, he parlayed a line of blather into a seat at the table. Before long, there was a proposal..... No, no, not a Wall in 2016; a nineteenth century railroad .... to build a Pan-American Railway, backed by governmental subsidies. [Charkes Morris reviewing Rutkow's The Longest Line on the Map, Wall Street Journal, Jan 8, 19] Le plus ca change, la meme chose.
Got/need security clearance during shutdown? finances continue to top the reasons for security clearance denial and revocation. ... security clearance holders do have good reasons to be concerned that financial hardships brought about by the shutdown could affect their security clearance. [Lindy Kyzer, govexec.com, January 7, 2019] Taking heart because you trust The Donald to act in your best interest?
Thousands of federal contractors are already feeling the pinch. According to Bloomberg’s Christopher Flavelle and Paul Murphy, contractors could see more than $200 million per day in lost or delayed revenue due to the shutdown. Not all contractors are suffering equally, though, since they vary considerably in size and include defense giants such as Boeing and General Dynamics that can more readily weather the storm. [Fiscal Times, Jan 7, 19] Note that funded agencies, like DOD, have the money to pay the contractors.
[L]et me beat any unreformed supply-siders to the punch on one final topic: There is little or no evidence that the Tax Cuts and Jobs Act of 2017 had much of an impact on wages — and certainly workers haven’t seen the absurd $4,000 per employee windfall President Donald Trump’s economic advisers and political allies made before the tax cut was passed by Congress. [Barry Ritholtz, Fiscal Times, Jan 7, 19]
There was no flag that he could wrap himself in. He didn’t brag; he didn’t boast; he didn’t use personal insults. He knew the world was watching, and he held everyone — most of all himself — to the highest ethical standards. Indeed, at first, some people thought Washington was too modest to lead an army. [Brad Meltzer, talking about his The First Conspiracy The Secret Plot to Kill George Washington,WashPo, Jan 5, 19]
The smell of fair-share politics. A significant majority of [NIH] SBIR and STTR grants awarded to small businesses in any given year end up in just a handful of states. For example, the percentage of all 2017 SBIR/STTR awards made to companies in the 23 states and Puerto Rico eligible to participate for funding from NIH’s Institutional Development Award (IDeA) program was only 8 percent – 97 of the 1,218 awards made across all phases of both innovation funding programs. For comparison, the same states account for 15.8 percent of the estimated U.S. population in 2017. NIH wants to change that discrepancy. [SSTI, Jan 2, 19] If SBIR is a national competition there is no reason to expect any particular distribution related to population. The awards would naturally go to plaes where innovation self-assembles. If Iowa or Oklahoma wants more, it must first create the conditions for innovation to self-assemble there. SBIR was first invented for fair-share to certain types of small biz, and now would further fair-share on a population basis.
FOIA re-write brainstorm. [Trump] appeared to order Acting Defense Secretary Shanahan to stop releasing Inspector General reports to the public. [DefOne Jan 3, 19] How convenient to hide Executive Branch shenanigans.
Immigrants in demand. The Labor Department received nearly 100,000 temporary-worker visa requests in the first five minutes of New Year’s Day, an unprecedented demand that caused the online submissions portal to crash. [Wall Street Journal, Jan 3, 19]
[Economists] may simply have to accept the inevitable: convincing most people of the value of free trade is a losing fight. .... most people—and therefore the politicians who represent them—see no contradiction in supporting technological advances while opposing freer trade. Raging at the machine seems stupid, but raging at foreigners does not. [Alan Blinder, Foreign Affairs, Jan/Feb2019]
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Fantasy fact. Trump says most furloughed federal workers are Democrats. How does he know that, and why would it matter?
Overall federal R&D spending, at 0.7% of gross domestic product, is roughly half what it was in the mid-1980s. The Trump administration, “apart from a few areas, has done everything to scale back American investments in research,” said Matt Hourihan, a budget analyst at the American Association for the Advancement of Science. [Bob Davis, Wall Street Journal, Dec 23, 18] Why would we expect a real estate mogul to understand investment in science and other long term investments? Fortunately, Congress with corporate memory does understand. Trump signs the resultant legislation having made his noise for his political base.
Don't need no Secretaries. Cabinet officers come and go in Washington with little lasting political impact, but the resignation of Defense Secretary Jim Mattis strikes us as a major political event that is likely to reverberate for the rest of Donald Trump’s term and damage him in ways the President doesn’t seem to appreciate. [Editorial Board, Wall Street Journal, Dec 21, 18] Trump personifies "arbitrary and capricious".
Comic (tax) Relief. Jared Bernstein [economist] testified before the House Financial Services Committee on “the peril of an ignored national debt.” The hearing was delayed for a vote on new tax cuts that would increase the debt by roughly $100 billion. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Dec 20, 18]
The House voted 348-11 for a bill speeding U.S. development of quantum computing, an emerging technology with potentially revolutionary uses. President Trump is expected to sign the measure. [Wall Street Journal, Dec 19, 18]
The Trump Tax Cuts Boosted Growth and Jobs, but at What Cost? The deficit has ballooned, and most of the benefits went to corporate profits rather than employees. [Jason Furman, Wall Street Jounral, Dec 18, 18]
First America Firsters> By 1765 many colonists believed that the perfect America would have no Indians in it at all. [Katherine DuVal reviewing Spero's Frontier Rebels, Wall Street Journal, Dec 18, 18]
Bill Priestap, the FBI’s top counterintelligence official, told lawmakers. “Every rock we turn over, every time we looked for it, it’s not only there, it’s worse than we anticipated.” The FBI's comments highlight the multiple avenues the federal government is pursuing to counter China—from tariffs to trade talks to legislation to counterespionage to criminal charges. [Jeff Sparshiott, Wall Street Journal, Dec 12, 18]
NSF surrenders as its biology directorate announced it will no longer limit researchers to submitting only one proposal in which they are listed as a principal investigator (PI) or co-PI. It was intended, in part, to reduce the number of rejected proposals resubmitted without major changes. But scientists pushed back, fearing the change would discourage collaborations and disadvantage those who rely on the PI designation for career advancement. NSF officials say opposition from the community—and a dip in grant submissions to the biology directorate—prompted them to reverse course. [Science, Nov 23, 18] Agencies have a problem announcing what will win and what will not win so clearly that the hopeless proposals stay home. Because bureaus naturally avoid speaking unwanted truth before, during, or after a proposal.
Alexander Kott, Army Research Laboratory’s chief scientist, cautions when thinking about technology that it is best to think more about strategy and solutions before making a long list of requirements. “You cannot sprinkle AI (artificial intelligence) on a problem to make it go away,” he said. “It is not magic dust.” [Association of the U.S. Army ausa.org, Dec 9, 18]
DEMOCRACY IS THE art of running the circus from the monkey cage,” the American satirist H.L. Mencken once quipped. [The Economist, Nov 10, 18]
Fairfax County VA [one of America's richest] announced it will contribute $1M to help Reston innovation hub Refraction expand. The county anticipates the investment to generate 800 new tech jobs, train 2,500 workers and lead to $200 million in new capital investment over the next five years. [DCInno, Dec 4, 18]
Although he has repeatedly hailed the deal he made earlier this year to increase spending on what he called a “depleted” military, President Trump declared that U.S. defense spending was too high, calling it “Crazy!” [Yuval Rosenberg and Michael Rainey, Fiscal Times, Dec 3, 18] Did he hear the hoofbeats of the Democrats' grabbing the House and seven governors?
Politics first. CIA Director Gina Haspel was furious that the report describing the CIA’s assessment of MBS’s involvement in Khashoggi’s killing was leaked, the New York Times reports. [Lara Seligman and Elias Groll, Foreign Policy, Dec 3, 18] Secrecy is hard to maintain where political advantage can be sought from announcing the facts. Such is today's national capital and divided electorate.
I appoint judges who should obey my commands. He lied for this outcome and should, in my opinion, serve a full and complete [prison] sentence, says the nation's chief executive. Forseeing such a coup of executive intervention, the founders appointed judges for life and the executive for a fixed term.
Synthetic biology. The Pentagon is also looking at living camouflage, self-healing paint, and a variety of other applications of engineered [marine] organisms [a field that promises living camouflage that reacts to its surroundings to better avoid detection, new drugs and medicines to help deployed forces survive in harsh conditions, and more], but the basic science remains a challenge. .... There’s currently a $45 million effort across the Army, Navy and Air Force, dubbed the Applied Research for the Advancement of Science and Technology Priorities Program on Synthetic Biology for Military Environments, aimed at giving researchers the tools they need to engineer genetic responses into organisms that would be useful for the military. [Patrick Tucker, DefenseOne, Dec 1, 18]
1944] the Great Depression and the
rise of European fascism had scared American executives. Many had come
to believe that unrestrained capitalism was dangerous — to everyone. In
the years that followed, most executives behaved as if they cared about
their workers and communities. And the economy — and American business
— boomed. If postwar executives returned with the same ideas today,
they would be branded as socialists. In truth, they were the
capitalists who cared enough about the system to save it. The same goes
for the new reformers. [David Leonhardt, New York Times,
18] Today, the White House leads the charge to return capitalism to its
profits-over-everything approach at the expense of any other national
DOD misunderstands SBIR. The military has poured billions of dollars into [SBIR] — yet resists putting its fruits to use. ... It is also not apparent that the DOD understands the intent of the SBIR Program or the boom in innovation that would result if SBIR companies were given the support to run with their innovation. [Rep Ken Calvert, Vice Chairman of the House Defense Appropriations Committee, DefenseOne, Nov 30, 18] Never mind, SBIR is a political handout to a favored group with the main objective of delivering money to the group. Something the US Congress does well. Over SBIR's three decades Congress has systenatically suppressed any economic evaluation as would be demanded of any program that required appropriations. DOD over those decades did what any bureau would do - it used the program as best it could to advance the bureau's objectives assigned by Congress's annual authorization law. Congress never made any clear statement that SBIR was to pursue any other over-riding objectives. That much DOD fully understands.
The federal budget process is a mess and it’s likely going to stay that way for the foreseeable future, as a special bipartisan committee set up to improve the budget process failed to approve even modest reforms. [Fiscal Times, Nov 29, 19] Too many losers for any proposed fix.
Don’t believe the hype. Any agreement in Argentina will be a tactical pause at best, providing short-term relief to jittery stock markets and beleaguered U.S. farmers, but having no material or long-lasting effect on the slide toward a high-stakes geopolitical competition between the United States and China.Xi and the ruling Chinese Communist Party are incapable of addressing the United States’ fundamental concerns over China’s industrial policies and state-led economic model. Because of this, any process to settle these issues is bound to fail. [Ely Ratner, Foreign Affairs, Nov 27, 18] Of the two executive titans clashing and preening, only one has complete control of his government.
The surge in [government] borrowing is so great that it’s “beginning to warp bond indexes,” says Daniel Kruger of The Wall Street Journal. [Fiscal Times, Nov 28, 18] The credit-card lovers are still demanding more government than they are willing to pay for.
Trump threatens to cut ‘all subsidies’ for GM [Wall Street Journal, Nov 27, 18] Once again Trump threatens power that he does not have because the subsidies are specified in US law.
Easier said than done. A consultant hired by the Trump administration to boost the number of border agents and customs officers has brought on just 15 of the 7,500 called for in its $300 million contract, according to figures provided by the agency. ... [partly because] More than three out of four applicants still fail their polygraph. [Eric Katz, Govenment Executive, Nov 26, 18] Not surprising that top candidates are not signing up when the national unemployment rate is in record low territory as often shouted by the Braggart-in-Chief. There is a classic tactic to bring in top candidates: raise the pay.
Henry Paulson, first at Goldman Sachs and later as Treasury secretary, and now as elder statesman, concludes China engagement is failing and an “economic Iron Curtain” may soon descend between the two. ... unsparing in his criticism of China’s current direction. ... a sobering statement of the perilous state of relations between the two economic superpowers. [Greg Ip, Wall Street Journal, Nov 26, 18]
Real estate mogul deals his way. Trump said in an interview he expects to move ahead with boosting tariff levels on $200 billion of Chinese goods to 25% [Wall Street Journal, Nov 26, 18] He's still in his Trump Tower, with deams of grandeur, says he wants US auto maker to ignore world-wide over-capacity and uncompetitive US production costs.
Investors avoid uncertainty. It is found that electorally-induced policy uncertainty decreases manufacturing investment in US states. In a state with average partisan polarization, the elasticity of election-year investment to a specific measure of policy uncertainty is -0.027. When the incumbent governor is term-limited, there is greater uncertainty over the outcome, providing an instrument to demonstrate this effect is causal, not simply coincidental. Moreover, manufacturing investment does not rebound following the election. Rather, own-state uncertainty is associated with a large and significant coincident rise in neighboring states' investment. These findings suggest that policy uncertainty at the sub-national level drives investment to alternate sites. [Nathan Falk and Cameron A. Shelton, J Economic Policy, Nov 2018]
Tax beats subsidy. Taxing the continued operation of incumbents can lead to sizable gains (of the order of 1.4 percent improvement in welfare) by encouraging exit of less productive firms and freeing up skilled labor to be used for R&D by high-type incumbents. Subsidies to the R&D of incumbents do not achieve this objective because they encourage the survival and expansion of low-type firms. [Daron Acemoglu, Ufuk Akcigit, Harun Alp, Nicholas Bloom and William Kerr, American Economic Review, Nov 2018] Which politicians would admit to taxes for the puprose of driving firms out of business when they can get headlines for subsidies to attract firms, however efficient?
Swarming upstream. DARPA-funded [swarming] drones worked together despite heavy electronic-warfare [jamming] defenses. .... For years, the Defense Department has funded efforts to apply emerging technologies like machine learning and artificial intelligence to the task of finding small areas of spectrum to allow for short bursts of essential communications between military assets—little windows where just enough data can get through to allow for all the components to work together. That’s what they demonstrated in Yuma. [Patrick Tucker, DefenseOne, Nov 21, 18]
Will fantasies ever end? SECSTATE Pompeo said the Trump administration is trying to persuade the Iranian people that the United States re-imposed economic sanctions on Tehran as a way to “protect” the Iranian people. [The Hill, Nov 26, 18] Perhaps the Iranians could reciprocate to "protect" the American people.
Keep AI genie in our bottle. the US made its latest move by proposing to broaden its restrictions on technology exports. The Commerce Department maintains a list of militarily sensitive technologies that require a special license to leave the country. ... proposing to add to the list, among other things, a breadth of foundational tools and techniques in artificial intelligence, like neural networks and deep learning, natural-language processing, computer vision, and expert systems. Commerce is seeking public comment through December 19 [MIT Tech Rvw, Nov 20, 18] America alone, again.
Autocrat seethes at separation of powers. Trump lashed out against the US Court of Appeals for the Ninth Circuit, calling it a lawless disgrace and threatening unspecified retaliation. [Adam Liptak, New York Times, Nov 19, 18] Earlier Donald McGahn, the [White House] lawyer, told Mr. Trump that presidents did not have the authority to order prosecutions [even of political opponents], and warned him that any such move could lead to impeachment. [JILLIAN RAYFIELD, New York Times, Nov 20, 18] Rule of law is just not an autocrat's thing. Which is why the founders made lifetime appointment of federal judges.
Learn DOD. Startups that want to gain a better understanding of Defense Department customers and end-users can apply to the DOD-sponsored Startup Innovation Fellowship (SIF), which pairs highly-trained military and civilians experts with startups for six week immersive experiences, allowing fellows to experience frontline innovation and offering companies perspectives on Defense Department needs and market opportunities. The application for this cohort closes on Dec. 5. Apply here . [BostInno.com, Nov 19, 18]
Where does our capital go? The total cost of post-9/11 wars will approach $6 trillion by the end of fiscal 2019, according to an annual report published by the Watson Institute for International and Public Affairs at Brown University. .... What are companies doing with their tax cut windfalls? In addition to boosting shareholder returns through buybacks and dividends (more on that here, here and here), U.S. corporations are placing a new priority on paying down debt, according to a report released by Moody’s Investor Service. .. 43% to buybacks and 37% to debt [Fiscal Times, Nov 15, 18] Although war usually leads to some technology innovation, most of the expense has no ROI. Then why do it? Because we are the biggest, baddest, strongest giant in the valley.
Don't need no aliens. U.S. enrollment of international students declined for the second year in a row, sending waves of unease across American colleges and universities. Foreign students are big business: They pumped $42 billion into U.S. college and university coffers in the 2017-18 school year alone. Students from abroad are still flocking to the coasts, but are less interested in the South and Midwest, Michelle Hackman and Douglas Belkin report. The shift is due to a combination of politics, fear, geography and branding, said Alejandra Sosa Pieroni, an international recruitment expert with Ruffalo Noel Levitz, a company that consults with colleges to improve enrollment. [Jeff Sparshott, Wall Street Journal, Nov 13, 18]
Texans are offering millions of dollars in awards to boost research in neurodegenerative disease. A prize in San Antonio will focus on ideas that explain the cause of Alzheimer’s, and a Dallas-based foundation will start handing out annual awards for work on diseases, such as the devastating progressive supranuclear palsy (PSP), that involve the wayward protein tau. [Ben Fidler, xconomy.com, Nov 8, 18]
Deja-vu. “But once the generation with
memory of fighting had died, the next war came along,” Mr. Schönpflug
[German historian] said. “History teaches us that when the generation
that experienced war dies out, caution diminishes and naiveté toward
[Katrin Bennhold, New York Times, Nov 10, 18] One hundred
all new people. People who mostly ignore history, or distort convenient
pieces of it for political purposes.
“It is not
declared, few have to
fight, and no one has to
Ellis’s powerful epigram captures why we now have so much war.
[David O Stewart, reviewing Ellis's American Dialog, Washington Post,
Nov 8, 18] We have certainly slid into the comfort suite of
our big political desires and simply adding the cost to the national
A house of many mouths. Trump’s senior trade adviser, Peter Navarro, excoriated China and attacked Goldman Sachs and Wall Street as Beijing’s “unpaid foreign agents” who are weakening the U.S. leader before his meeting this month with China’s president. .... Secretary of State Mike Pompeo and Defense Secretary Jim Mattis met with their Chinese counterparts to try to mend fences with Beijing, ... Other officials, including Treasury Secretary Steven Mnuchin and National Economic Council Director Larry Kudlow, have been trying to line up a deal. .... A senior White House official said Mr. Navarro didn’t speak for the administration or Mr. Trump. “It’s the president who rejuvenated the China negotiations” when he called Mr. Xi on Nov. 1, he said. Mr. Navarro “is freelancing; he’s speaking for himself.” [Bob Davis and Gordon Lubold, Wall Street Journal, Nov 9, 18]
Former Treasury Secretary [and Goldman Sachs chief] Henry Paulson concludes that U.S. engagement with China is failing and an “economic Iron Curtain” may soon descend between the two economic superpowers. [Greg Ip, Wall Street Journal, Nov 8, 18] Paulson is a serious observer, not one of the crowd of economics fantasizers inhabiting the Trump administration.
After Wisconsin paid dearly for a job factory. Foxconn is considering bringing in personnel from China to help staff a facility being built in Wisconsin, as it struggles to find engineers and other workers. [Wall Street Journal, Nov 6, 18] Getting a new governor too.
The rich and the rural vs. the urban. The great compromise of 1787 gave the small states disproportionate representation in the Senate. Since then the ratio of small states to urban states has grown and the Senate is more married to home-cooked values. Unfortunately, the rural will not gain much economically from the new alignment, which will degrade their freedom to enjoy a rising nationalism. And [polarization] is exacerbated by a president who insists on aggravating the differences. In fact, after an election in which both parties can declare victories and mandates, the likelihood that parties will take these successes as evidence that they should continue business as usual—behaviors that contribute to polarization—is quite high. [Elaine Kamarck, Brookings, Nov 7, 18]
Trickle-down still popular. People who aren’t liberals — three-quarters of the country — don’t especially care about [economic] fairness. They do, however, care about growth. So Democrats need to argue that these investments, not tax cuts for the rich, are the way to spur growth. Such an argument stands in direct contrast to the right’s story. Republicans say the rich, with millions returned to them in the form of tax cuts, know best what to do with their money and the market can make the best decisions about investments and society’s needs. [Michael Tomasky, New York, Times, Nov 2, 18] Why? Most people do not have the economic education, nor a healthy grasp on the appropriate mathematics, and the US economy is so complex, to make an informed judgment. Meanwhile, the beneficiaries of the tax preferences can afford to influence the loyalty of politicians who need big money to afford political campaign expenses. And that train will keep running until the liberals (a.k.a Demoocrats) come up with and understandable and credible counter-story.
Shut the gates, raise the walls. Trump’s closing argument is now clear: Build tent cities for migrants. End birthright citizenship. Fear the caravan. Send active-duty troops to the border. Refuse asylum. [Michael Shear and Julie Hirschfeld Davis, New York Times, Nov 1, 18] Fear the women and tremble at the children escaping persecution. Wait; wasn't America built with the great infux of such people, like Trump's father? Where is Ronald Reagan's "Morning in America" as the economy booms?
ARPA-E is seeking commercialization experts to advise ARPA-E-funded innovators on business strategy, product development, IP and other areas to accelerate technology transfer. Tech-to-Market Advisors focus on transformational energy projects that can be meaningfully advanced with a small investment over a defined period of time. [ARPA-E newsletter Oct 30, 18] The usual problem is that governmnet funds SBIR for things government can love, but that's usually not somethig profiatble enough to attract commercial investment. If it could so attract capital, why struggle for government funding?
Mussolini Trump renewed his attacks on the news media following a week of election-season violence, arguing that “fraudulent” reporting was contributing to anger in the country and declaring that the press was the “true Enemy of the People.” [CATHERINE LUCEY, AP, Oct 29, 18] Classic fascist approach to smothering criticism - make it an enemy of the people. Just the scenario that the First Amendment was meant to prevent. It doesn't matter whether the media are right or wrong; they are entitled to freely express their ideas and opinions. Just like a serial lying president.
The Navy’s USS John Finn destroyer launched the SM-3 IIA missile to intercept the ballistic target during the test in Hawaii, marking the missile’s second fulfilled interception, Raytheon said. [: Nichols Martin, GovConWire, Oct 29, 18]
More spending, less tax. A sharp pickup in government spending, particularly on defense, has helped fuel a broad acceleration in U.S. economic growth in the past year and a half. [Jeff Sparshott, WSJ, Oct 24, 18] Borrow more, spend more, and GDP rises. Surprise that credit cards make a richer life? And that politicians take credit for the growth while ignoring the debt? Vote for more fantasy from the magicians?
Surprise! “White House officials spent the day trying to decode what Trump meant because no one knew the substance of any such tax cut, or had seen any policy proposal related to it,” Politico reported Monday. [Yuval Rosenberg and Michael Rainey, FiscalTimes, Oct 23, 18] He tells them what they want to hear, and will mostly believe is real.
We’re in a hell of a mess in every direction. Respect for government, respect for the Supreme Court, respect for the president, it’s all gone. Even respect for the Federal Reserve. And it’s really bad. At least the military still has all the respect. But I don’t know, how can you run a democracy when nobody believes in the leadership of the country? [Paul Volker, New York Times interview by Andrew Ross Sorkin, Oct 23, 18]
Trump has embraced what we might call Kansasification of America. Taking a page out of former Governor Sam Brownback's playbook, the U.S under Trump has put into place the same sorts of tax and regulatory incentives that Kansas did circa 2012. [Barry Ritholtz, Bloomberg, Oct 18, 18] The Kansas experiment failed so badly that the legislature re-raised taxes and Brownback was eased out into a Trump-supplied job. But the US isn't Kansas and can just let the national debt climb so that no one in the present will feel much damage until all the present Congress is out of office. A nation addicted to credit card debt will not be immediately bothered. Ain't politics magic?
Research up for FY2019: NIH up 5%, DOD basic up 8%; DOD basic research up 8%; DOEnergy science up 5.2% ignoring Trump's plan for wholesale energy cuts. [Science, Sep 21, 18]
Math decline. More U.S. high-school graduates who took the ACT college-entrance exam aren’t ready for college-level coursework, with math readiness at a 14-year low. [Tawnell D. Hobbs,Wall Street Journal, Oct 17, 18] best scores in New York, New England, and Michigan.
Trump Seeks 5% Budget Cuts From Cabinet Agencies. [Wall Street Journal, Oct 17, 18] I shot an arrow into the air; it fell to earth I know not where. Trump's typical grand bluster will start to fade when he names specific losers. Never mind, it's only meant to stroke conservatives in next month's elections.
Commerce Secretary Ross said President Trump wants quick results from trade talks with the EU and warned that progress was unsatisfactory. ... "our president’s patience is not unlimited,” Mr. Ross said [Wall Street Journal, Oct 17, 18] Imagine that - Europe doesn't buy the bluster. Meanwhile, corn and soybeans are piling up unsold in Ameriuca's breadbasket Midwest.
Dreamcasting. Senior White House economic advisor Larry Kudlow touted the Trump economy, “[w]e're in a hot economic boom. There's no end in sight." ... Some critics on social media immediately questioned Kudlow’s forecasting track record — he famously said in December 2007, just as the Great Recession was beginning, that the “Bush boom” would continue “for years to come.” [Yuval Rosenberg and Michael Rainey, Fiscal Times, Oct 12, 18]
North Carolina finds success with SBIR/STTR matching grants. An evaluation of the One [NC[Small Business Matching Fund, providing grants of up to $50,000 to recent SBIR/STTR awardees, suggests that the program is achieving its goals of creating high-skill, high-wage jobs. Over the past 10 funding cycles, the $17.2 million deployed across 250 small businesses has created or retained more than 900 innovation-oriented jobs, and raised an additional $5.6 million in tax revenue for the state, according to the analysis performed by the NC Department of Commerce. [SSTI, Oct 10, 18]
Attempts at Fixing the Civil Service System Have Made It Worse. Lawmakers have repeatedly taken a piecemeal approach to providing relief to laws governing the federal workforce that date back to the 19th century and were last updated on a wholesale basis in 1978, but federal officials said those agency-by-agency and job-by-job laws have created an overly layered and disparate series of special authorities. ... the military maintains 300 different pay systems. [Eric Katz, GovExecutive, Oct 10, 18] With 535 lawmakers with agendas and an urge for the spotlight, complexity is assured, despite simplistic posturing by the would-be-king.
in 2003, rather than imploring citizens to make sacrifices, House Majority Leader Tom DeLay stated that "Nothing is more important in the face of war than cutting taxes." [Rosella Cappella Zielinski, Foreign Affairs, Oct 10, 18] To maintain global hegemony, make war, cut taxes on the rich, borrow ever more money from the rich who get even richer by collecting the rising interest payments. Whatta deal.
Industrial policy, political favoritism, ..... Procter & Gamble lands steel tariff exemption. After many decades of Republicans being against picking corporate winners and losers, their so-called champion dives into waiving taxes for anyone he chooses.
Irresistable urges. President Trump repeated his displeasure with higher short-term interest rates set by the Federal Reserve. [Jerry Seib, WSJ, Oct 8, 18] Cannot resist the urge to opine while claiming no decision role. Intending to undercut his own appointee to an deliberately independent commission?
Turmoil in publishing. 11 national funding organizations in Europe [declared] that as of 2020, they will require every paper resulting from research funded by its members to be freely available from the moment of publication. [Martin Enserink, Science, Sep 1, 18]
NASA SBIR has cottoned onto the idea of third party validation ($$$$) for an Phase II awardees's SBIR technology as a basis for adding more NASA's SBIR money to the tech development. Note: I invented this concept for BMDO (now MDA) SBIR in the early 1990s. Rules and qualifications for CCRPP. No info on NASA's criteria for picking the expected 9-13 winners.
Need corporate tax cuts? Big banks and financialised multinationals say they need corporate tax cuts: of course they do, just as my children say they need ice-cream. But in survey after survey, business officials say that when they are deciding where to invest, they want the rule of law, a healthy and educated workforce, good infrastructure, access to prosperous, thirsty markets, good inputs and supply chains and economic stability. All these require tax revenues. As the US investor Warren Buffett put it: “I have worked with investors for 60 years and I have yet to see anyone [...] shy away from a sensible investment because of the tax rate on the potential gain.” [Nicholas Shaxson, The Guardian, Oct 5, 18]
To help provide Illinois startups transform into viable tech businesses, the state is now beefing up a [$700M] investment fund. ...starting in 2019, $700 million will be available in the Illinois Growth Innovation Fund, a more than $400 million increase to what it was before. [Katherine Davis, Chicago Inno, Oct 2, 18] in a state that just recently emerged from political paralysis and possible bankruptcy.
Mobilizing your mob. What we saw in these [confirmation] hearings was the unvarnished tribalization of national life. At the heart of the hearings were two dueling narratives [about] What happened at that party 36 years ago? ... This, of course, led to an upsurge in [political] base mobilization. Persuasion is no longer an important part of public conversation. Public statements are meant to mobilize your mob. [David Brooks, NY Times, Oct 4, 18]
White House's Council of Economic
Advisers increasingly is using alternative economic statistics to
bolster President Trump's argument about economic strength. (Bloomberg)
[Jerry Seib, WSJ, Oct 3, 18] And as long as Trump's base
supporting him, his 40% approval is enough to frighten the Republican
Congress into playing his game.
But in the
early 2000s, most
high-wage, middle-skilled jobs disappeared. Now there is only a
high-wage, high-skilled job and a low-wage, low-skilled job. And that
has fractured the middle class and left a lot of people behind. ... And
not only have we lost the buffers and cushions we once had, but a
generation of leaders has come along, led by Donald Trump, who have
made fueling our
their business model. [Tom Friedman, NY Times, Oct 2,
18] Accordingly, the Republican party opts for
aggravating the split by handing out national treasure to the wealthy
and pressing to cut any programs that help the abandoned former
middle-class. Maybe one day that abandoned middle class will
blaming immigrants while believing Trump and support approaches that
recognize the real problems.
Trickle-down truth. A poll of 1,500 companies by consulting firm Mercer LLC showed 4% are redirecting tax savings to budgets for bigger paychecks in the coming year. [Wall Street Journal, Oct 2, 18]
Whistling in the hurricane. [Two] former congressmen are sounding the alarm about the $21.5 trillion federal debt [Liz Young, Albany Business Review, Sep 30, 18] So what? The Republican government does not care about deficit since their top priority is paying off their President and rich supporters with big tax cuts and happy talk about economic miracles. Besides, those supporters can then buy those growing interest rate Treasury bonds.
Don't Need No Scientists. The [EPA] plans to dissolve its Office of the Science Advisor, a senior post that was created to counsel the E.P.A. administrator on the scientific research underpinning health and environmental regulations, according to a person familiar with the agency’s plans. [Coral Davenport, New York Times, Sep 27, 18] The MAGA administration has only one figure of merit for EPA - corporate profits.
Cold War Ahead. Beijing has shown no sign of caving to U.S. demands that, in totality, entail a wholesale end of the industrial policy that has long guided Chinese economic development. Some suspect the U.S. goal isn’t a negotiated solution, but to disentangle the two economies permanently. [Greg Ip, WSJ, Sep 26, 18]
In your face. Trump actually tweeted last week: “We are under no pressure to make a deal with China, they are under pressure to make a deal with us. … If we meet, we meet.” [Tom Friedman, NY Times, Sep 15, 18[
Tech start-ups victimized. The price of the Brilliant (no SBIR)'s 'smart home' controller went up $50 even before it went on sale. The three-year old company joined the race to create intelligent home devices last week. .. The White House’s latest round of threatened tariffs on imports from China — where the device is manufactured — led the company to push the price up to $299 at the last minute. ... Hardware entrepreneurs say new levies on Chinese imports of up to 25 percent could be the "death knell" for their inventions. [Richard Waters, Financial Times, Sep 12, 18] Hear the cheers of the real-estate mogul's "base" every time he asserts another imaginary fact.
The Business Roundtable
nearly two-thirds of chief executives said recent tariffs and future
trade tension would have a negative impact on their capital investment
decisions over the next six months.
Roughly one-third expected no impact on their business, while only 2
percent forecast a positive effect. [Yian Mui, CNBC, Sep
18] As always, be careful what you wish for.
It took a lot more than fireside chats to turn [1930s isolationist] public opinion around. It took Hitler’s conquest of Europe, near-conquest of Britain and, finally, Pearl Harbor to convince a majority of Americans that America First was a mistake. [Robert Kagan, New York Times, Sep 23, 18]
Fighting the last war. The Chinese government said it plans to impose new tariffs on $60 billion in U.S. exports [Wall Street Journal, Sep 18, 18]. Trump is using the tariff and home-cooking tactics of the 1920s to fight his perceived enemy of multi-national trade cooperation and businesses in a world much more connected and distributed than the 1920s. He could find himself in the same kind of morass that LBJ found in Vietnam with WW II mentality.
When government is devalued, pawns fall off the chessboard. The Trump administration is unable to account for the whereabouts of nearly 1,500 migrant children who illegally entered the United States alone this year and were placed with sponsors. Meanwhile, Trump administration officials told a Senate panel on Tuesday that a decades-old court ruling that limits the length of time migrant children can be detained hampers the government’s ability to stem illegal immigration. [Ron Nixon, New York Times, Sep 18, 18] BTW, where is your SBIR proposal/money?
Spurring unintended consequences. “The U.S. tariffs are pushing China toward making the higher-end stuff,” Mr. Lu said as he walked past red-uniformed workers assembling table lamps in his Shenzhen factory. “It’s helping China be more competitive down the road.” [Liza Lin and Dan Strumpf, Wall Street Journal, Sep 17, 18] Students of American history might reflect on the consequences of England's 18th Century mercantile rules on the independent development of the American colonies. But our president semms to have slept through those history lessons
Thrust and parry in trade negotiations. Trump sounds like Napolean-Hitler-Tojo in taking on a big country on its home turf as deep countries absorb its attackers. This ain't a real estate deal nor reality show.
Denuding government. Under Gov. Scott Walker, Wisconsin reduced government spending, sidelined labor, loosened environmental regulations and restricted access to voting. As a result, Kaufman writes, the state’s roads are the second worst in the country, its renowned universities are bleeding talent and poverty rates have reached a 30-year high. [Michael O’Donnell reviewing Kaufman's THE FALL OF WISCONSIN, New York Times, Sep 14, 18]
Useful deficit. Washington Post’s Erica Werner says, “The [appropriation] deal could also cement another setback for deficit hawks, because it would continue the Trump-era tradition of boosting up spending levels in the hopes of receiving bipartisan support.”
Political Opioid. The Committee for a Responsible Federal Budget projects that the GOP’s proposed second round of tax cuts will add $5 trillion to the national debt over the next 20 years. ... Maya MacGuineas, president of the Committee for a Responsible Federal Budget: “It is amazing that things are so much worse and yet people care so much less.” [By Yuval Rosenberg and Michael Rainey, Fiscal Times, Sep 12, 18] Neither party has the courage to honor its own rhetoric on deficits as it pssses out money for its supporters.
Profit paramount. The Trump administration proposed weakening requirements for testing and repairing methane leaks in drilling operations. ... EPA said the changes will save the industry $75 million a year in regulatory costs between 2019 and 2025, while increasing methane emissions. [Reuters, Sep 11, 18] If profit is paramount, no need for pretend investment programs like SBIR for uncompetitive companies. Reminder: P in EPA stands for Protection.
Democracies are creatures of the present because the public focuses on the here and now, not some future hypothetical problem. To be fair, all these tendencies pre-dated Trump’s election — and will, almost certainly, survive his leaving. [Robert Samuelson, WashPo, Sep 10, 18] We, of course, pretend that we are smarter than "the public."
Brooms and shovels behind the elephant parade. President Trump was incorrect when he tweeted that more than a century had passed since quarterly economic growth last outpaced the jobless rate, the White House said. [Wall Street Journal, Sep 10, 18]
Who are the deserving poor? Middle-class families account for about 46 percent in 2014 of social safety net [means-tested] spending in the U.S., according to Brookings Institution report [by Richard Reeves and Christopher Pulliam] - doubled from about 23 percent of all means-tested spending in 1979. [Brookings, Sep 4, 18]
Stressed SBIR overseeer? Trump said he would freeze the pay of more than two million civilian federal workers next year, citing the growth of federal spending [as a "national emergency"]. [Kate Davidson, WSJ, Aug 30, 18] He got his and now everyone else has to be cut for fiscal responsibility. But Congresss will probably not allow it anyway.
Where's our big paycheck? Bloomberg’s analysis of recent wage trends finds that the big wage increases Republicans promised would result from their tax cuts have yet to materialize. Instead, inflation-adjusted hourly earnings are now slightly lower than they were a year ago (see more on this below). And a Quinnipiac University poll released two weeks ago found that, by a 58-38 margin, voters say the Trump administration isn’t doing enough to help the middle class. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Aug 29, 18]
Take a strong economy, add a dollop of tax cuts, and you get very strong corporate profits. [Brian Blackstone, WSJ, Aug 29, 18] Cut, cut, elect, elect; but only if the voters feel a marked benefit and don't notice the borrowing that's paying for the cuts.
Would-be dictator accused Google of elevating critical news stories about his presidency at the expense of friendly conservative voices, signaling potential government action if it didn’t alter its alleged practices. [Wall Sreet Journal, Aug 28, 18] His evidence for the court? His ringing voice.
Idea contest. NSF 2026 Idea Machine is a competition to help set the U.S. agenda for fundamental research in science and engineering. Participants can earn prizes and receive public recognition by suggesting the pressing research questions that need to be answered in the coming decade, the next set of “Big Ideas” for future investment by NSF. plan to launch the Idea Machine competition in late August 2018. Watch contest website.
DARPA asked industry to propose applied research and basic concepts that could help build and maintain systems designed to facilitate automated knowledge curation, discovery and application. .. will award up to $1 million to develop a prototype FedBizOpps notice posted Aug. 17. Response date Sep 17. [Jane Edwards, GovConWire, Aug 24, 18]
The head of Army acquisition has a message for small tech firms: come use our laboratories [thru CRADAs] ... says Bruce Jette, assistant Army secretary. We have to put everything on FedBizOpps, but I'm also looking for: What do you read? Where do you get your info? Where can I get in front of you my ideas, my needs, my desires for your help [with] things," he said. "We're looking at an overall public affairs strategy with respect to how we communicate with the larger innovation audience." [Marcus Weisgerber, DefOne Global Business Brief, Aug 23, 18] CRADAs have a long history [longer than SBIR] with little public knowledge of results. And political appointees usually have a short tenure because they can earn so much more in the private economy.
Trade talks between the U.S. and China failed to produce any visible sign of progress, reducing the prospects of a deal soon, people closely tracking the talks said. [Brian Blackstone, Wall Street Journal, Aug 23, 28] Xi may be betting that US trade intransigence may loosen after investigations and November elections. China also has a longer history view than US politicians.It worked at least once. Using newly installed facial-recognition technology, a man entering the U.S. from Brazil with a French passport at Washington Dulles airport was identified as an impostor, the U.S. Customs and Border Patrol said . The facial-comparison system has been installed as a technology demonstration in 14 airports and put into use on August 20. (Fortune) [Crain's Washington DC, Aug 24, 18]
Who's crushing it? Who is actually getting ahead in the Trump economy? ... while the tight labor market is highly welcomed, real hourly pay for most workers remains flat. In contrast, corporate profits and equity markets truly are crushing it, both on a pre- and especially, given the large business tax cuts, a post-tax basis. There is also no evidence of an investment boom. [Jared Bernstein and Ro Khanna (Member of Congress], WashPo, Aug 24, 18] Nevetheless, stand by for bodacious "crushing it" claims from the White House.
Apres moi le deluge. If I ever got impeached, I think the market would crash. I think everybody would be very poor. Besides I don't know how you can impeach somebody who's done a great job. -- Donald Trump
The president’s Office of Management and Budget projects that the deficit for fiscal year 2019, which begins in six weeks, will be $1.085 trillion. This is while the economy is, according to the economic historian in the Oval Office, “as good as it’s ever been, ever.” [George Will, National Review, Aug 19, 19] The national credit card is boosting total economic life the same way anybody could buy more luxury - borrow , borrow, borrow. Our politicians in power claim praise for our luxury and speak not of the credit card account.
The Office of Management and Budget and the Congressional Budget Office released new budget forecasts that show the nation falling into a deep financial hole, writes James Capretta. Unfortunately, the media is distracted and hasn’t covered the federal budget outlook the way it has in prior years. Meanwhile, policymakers are ignoring the budget problem because they don’t want to take responsibility for solving it. [James C. Capretta,AEI, Aug 16, 18] Tax Cuts usually make better Republican political sense than national economic sense, as Republicans try to return to the late 19C Gilded Age. Trump and the Republican Congress are just copying the political logic of Reagan and W in selling the tax cuts by pretending there are no consequences for federal economics. Trump, self professed "King of Debt," even had the brass to suggest that federal bond holders could be made to take a haircut on Treasury bonds backed by "full faith and credit" of the US Government.
[New Mexico] economic development fund is providing up to $3 million to help spur growth of [state] bioscience startups. Gov. Martinez announced the Catalyst Fund will provide the funding to ... match the state funding and invest in technology companies in early stages of development. [AP, Aug 16, 18]
Fifteen companies have landed spots on the unrestricted full-and-open track of a potential nine-year, $28 billion contract vehicle for technology research and development services to the Defense Department. [GovConWire, Aug 14, 18] One - MacAuley-Brown (Dayton, OH) - had $6M SBIR.
Sidelined scientists. Employees at more than a dozen federal agencies [including the people who review and select SBIR awards]reported that science has been essentially sidelined from the decision making process as a result of censorship from political leadership, preemptive self-censorship from scientists themselves, decreasing morale and workforce reductions, according to a new report from the Union of Concerned Scientists. [Erich Wagner, Government Executive, Aug 14, 18] There is, of course, no guarantee that politics will not affect SBIR awards in an environment of political self-protection.
How deep the hole? Trade wars may be morphing into something more dangerous: financial wars. The U.S. and other countries are weaponizing international finance in ways that could destabilize the global economy and fray the intricate web of relationships that sustain it. The latest example: President Trump doubled tariffs on imports of its steel and aluminum from Turkey, pouring fuel on the country's currency crisis, Greg Ip [WSJ] writes. [Jeff Sparshott, WSJ, Aug 15, 18] The man with the shovel still owns a real estate empire that has no external control systems.
The U.S. Army has been granted emergency approval by [FDA] to use a new type of freeze-dried plasma on the battlefield. The plasma comes in durable plastic bags, is more portable and less susceptible to damage than the current glass bottle system, as well as easier to reconstitute for medical use. [AUSA, Aug 10, 18]
Houston NASA meetup. NASA is hosting a pitch night Aug. 27 for innovations in artificial intelligence, autonomous robots, and biotech, among other sectors. The Houston event is part of NASA’s Ignite the Night series in which the space agency is soliciting innovation ideas from startups. Another pitch event will be held Aug. 20 in Denver. Applications to pitch in Houston must be received by Aug. 17. [Angela Shah, xconomy.com, Aug 10, 18]
The reality is that, well before Trump became president, global trade imbalances were shrinking. Figures from the [IMF] show that, as a share of the [GDP], the U.S. current account deficit hit a recent peak of 5.8 percent in 2006 and dropped to 2.4 percent by 2017. ... The implications are unexpected. Even according to Trump’s twisted view of trade, much of the needed adjustments have already occurred. [Robert Samuelson, WashPo, Aug 12, 18] Trump's schemes and political appeal rely on a simplistic and emotionally appealing take on cherry-picked economic facts. Caveat emptor: Buy him at your peril.
the head of Navy acquisition has stood up a task force to ensure emerging technology makes it into the service's new weapons. [Defense One's Global Business Brief, Aug 8, 18] Every service often talks of innovation but tends to bury it in unavoidable problems with logistics and dogma, until ships or planes start being disabled or killed. If you have proprietary ideas for countering the small-ship Iranian Navy, by all means dial up the Navy.
Don't expect procurement innovation. fewer than half [of government acquisition professionals] rate innovation as important to successful acquisitions. Only oversight rated lower in importance among acquisition professionals, and Chvotkin said it may be because feds are confused about what innovation actually means. [Frank Konkel, NextGov, Jul 19, 18] Government procurement is, after all, protected by a mass of regulation to prevent dumb or corrupt dealing.
The Chinese theft of U.S. intellectual property remains a “critical” threat, with perpetrators who have adapted to evade the structures of a 3-year-old ban on such hacking, according to a top-secret report intelligence officials sent to Congress ... “Most Chinese cyber operations against U.S. private industry that have been detected are focused on cleared defense contractors or IT and communications firms whose products and services support government and private sector networks worldwide,” it reads. One such product, the report says, is CCleaner, a popular consumer application that removes unwanted files from computers. [Patrick Tucker, NextGov, Jul 27, 18]
Collateral Damage. A container ship carrying a $20 million worth of soybeans [70,000-tonnes] has been circling off the Chinese coast for over a month after being caught in the middle of [Trump's] US-China trade war. [Yahoo Finance, Aug 8, 18]
Outrageous.The President of permanent outrage and insult renewed his attacks on NFL players who protest during the national anthem, claiming they “wanted to show their ‘outrage’ at something that most of them are unable to define.” [The Hill, Aug 10, 18] Autocrats hate competition.
Constitutional liberties be gone. Forty-three percent of Republicans surveyed in a new Ipsos poll said Trump should have the authority to shut down the news media. Almost a third of Americans (29 percent) say “the news media [are] the enemy of the people,” offering support for a false statement often voiced by the president as his opinion [The Hill, Aug 8, 18] Political power from baldfaced lies. What do these people expect from a dictatorship with government control of the news? A reborn enlightened despot from the Middle Ages?
American companies [are also testing government's management abiity] in that they have filed thousands of tariff-exclusion requests since the tariffs on steel and aluminum began this spring. [Jeff Sparshott, Wall Street Journal, Aug 6, 18] How does a caustically shrinking government judge winners and losers in industrial policy? Politics always sounds better than it actually works.
There hasn’t been [a trade war] since the 1930s. That ended so badly the participants created a world trade body to mediate disputes. ... No longer. With the U.S. and China threatening to put tariffs on virtually all the other’s trade and neither side pushing for a new global trade round, “trade war” is becoming the appropriate description. [Bob Davis, Wall Street Journal, Aug 6, 18]
Millions of words have been spilled on covering Chinese history, culture, demographics, and politics will matter over the course of the next 20 years or so, but beyond that, only one thing will matter:Will the Chinese have the world’s best AI? If they do, then they will take over the world if they feel like it. If they do not, then they won’t. [Kevin Drum, Foreign Affairs, J/A18] Will it take an Act of Congress to restore sanity to US international trade?
Please, please, buy our stuff. [SECSTATE] promised a new era of U.S. economic engagement with Southeast Asian countries, extending an olive branch to a region increasingly concerned about a U.S.-China trade fight. [Wall Street Journal, Aug 3, 18] Please also, ignore our manners.
Fisher Ames, a representative from Massachusetts in the first U.S. Congress, once compared autocracy to a merchant ship, “which sails well, but will sometimes strike on a rock, and go to the bottom.” A republic, he said, “is a raft, which would never sink, but then your feet are always in water.” [Daniel Deudney and GJ Eikenberry, Foreign Affairs, J/A18]
SBIR was made permanent for the Defense Department continuing beyond the present expiration date in 2022 by Section 893 of the NDAA2019. Politics at work.
More industrial policy. The Trump administration embraced an emerging corner of the financial sector, telling companies that offer new ways to bank and invest that the federal government wants to help them grow. [Wall Street Journal, Aug 1, 18] Standard free market Republicans would be aghast at such a proposition. But they quiver at the thought of opposing Trump's blindly loyal base.
If them, then us, too. Jane Hardy, the chief executive of a company [Brinly-Hardy, southern Indiana] that makes lawn-care equipment, says she had to lay off 75 employees this summer because of President Trump’s trade war. .... The U.S. Chamber of Commerce estimated the total price tag could hit $39 billion if Trump compensated the losses across all industries [and] called it a “slippery slope” for Trump to determine who gets help and who doesn’t. [Recall the Republican horror for "industrial policy."] [Heather Long, WashPo, Jul 30, 18]
Fine words today. Secretary of State Mike Pompeo said in a speech that the U.S. was committed to growing trade and investment in Asia, and he assured potential strategic and trade partners the U.S. wants partnership, not domination. [Wall Street Jurnal, Jul 30, 18] How will the POTUS step on that message tomorrow with more America Alaone threats?
Master mercurial ingrate Trump lashed out at the powerful public policy and political network built by billionaires Charles and David Koch after it criticized his leadership and broke with its tradition of backing Republican candidates by declining to support [one of] the party’s pick ... “The globalist Koch Brothers, who have become a total joke in real Republican circles, are against Strong Borders and Powerful Trade," Trump tweeted Tuesday. "I never sought their support because I don’t need their money or bad ideas.” [John McCormick, Terrence Dopp, Bloomberg, July 31, 18] And who got the Trumpophile Congress elected?
The chaos surrounding the mammoth [immigrant family] reunification task, which had little precedent and no single playbook, shows what happens on the ground when an administration makes or reverses policy on the fly. [ Nour Malas and Alicia A. Caldwell, Wall Street Journal, Jul 27, 18] When a President's only management tool is an off-hours Twitter, and the people who claim to be guardians of religious morality support an amoral President.
Congress and President Trump Are Spending Money and Cutting Taxes Like There Is No Tomorrow. [Howard Gleckman, taxpolicycenter.org, Jul 28, 18] Serving a banquet with borrowed money with no plan for re-payment. Not a fresh idea: W had the same ideas.
Trump punts. The agreement with the European Union that President Trump announced week would lower tariffs and other trade barriers, reduce bureaucratic roadblocks and end conflicting regulations for drugs and chemicals. The U.S. was pursuing much the same approach under President Barack Obama, through a deal that Mr. Trump shelved last year. [Chris Stanford, New York Times, Jul 26, 18]
Trade war casualty. China kills Qualcomm's $44 billion deal for NXP,the latest casualty in the escalating US-China trade tensions. QCOM is now stuck with paying NXP a $2 billion breakup fee.... In March, President Donald Trump blocked a $117 billion takeover of Qualcomm by rival Broadcom (AVGO), arguing that it could help China beat the United States in developing 5G technology. The following month, the Trump administration imposed a crippling ban on Chinese smartphone and telecommunications company ZTE, preventing it from buying crucial parts from American companies. [Sherisse Pham, CNN, Jul 26, 18]
The Credit Card State. The amount of corporate taxes collected by the federal government has plunged to historically low levels in the first six months of the year, pushing up the federal budget deficit much faster than economists had predicted. [New York Times, Jul 25, 18] Annual deficit to soon reach $1 trillion (that's $1000 billion) after Republican Congress caved to corporations and other wealthy patrons by accepting the fantasy economic projections from the corporatist Treasury Secretary.
Congress settled on a significant cut a number of the Pentagon’s back office functions. [Government Executive, Jul 24, 18] The usual result is less attention to minor programs like SBIR.
Post truth, no trust. The proliferation and Balkanization of news sources, abetted by the cloak of web anonymity, has left people feeling that they “have been denied trustworthy sources of information,” Mr. Blackburn writes. In response, they “take refuge in believing whatever they would like to be true.” If you can’t trust anyone or anything, you are left only trusting your gut. [Julian Baggini reviewing Blackburn's On Truth, Wall Street Journal, Jul 24, 18]
Friendly fire victims. The government announced a $12 billion plan to assist farmers who have been hurt by President Donald Trump’s trade disputes with China and other trading partners. The plan focuses on Midwest soybean producers. [KEN THOMAS and PAUL WISEMAN, AP, Jul 24, 18] Run more deficit spending to recover votes for political trade charades. “This is becoming more and more like a Soviet-type of economy here: Commissars deciding who’s going to be granted waivers, commissars in the administration figuring out how they’re going to sprinkle around benefits,” said Sen. Ron Johnson (R-WI). [Fiscal Times]
The U.S. Army has chosen 10 firms to compete for rapid prototyping orders under a potential three-year, $192 million contract. [GovConWire, Jul 23, 18] Fibertek had 127 SBIR awards; Trideum two awards.
Loved the promises. Trump’s tax cut hasn’t done anything for workers: Wages were supposed to rise. Instead, they’ve fallen, by Noah Smith, Bloomberg opinion contributor. https://trib.al/G69T9at [The Hill, Jul 24, 18]
An Army technology competition aimed at small tech firms and entrepreneurs with big game-changing ideas received 340 entries by its July 11 deadline. The Expeditionary Technology Search, xTechSearch, will offer prizes of up to $200,000 for the best technology that addresses an Army mobilization priority. What to watch: The papers are being reviewed by Army scientists and engineers. Notifications will begin today for those who will be invited to make a face-to-face pitch. [ausa.org, Jul 23, 18]
A new [DARPA] program called SHort-Range Independent Microrobotic Platforms, or SHRIMP, is looking to reward researchers who can overcome the big barrier to micro-robot fielding: creating strong motors that sip power. [DefOne, Jul 18, 18] read Solicitation ; response date Sept 26, 18. DARPA press release. Military permanent need: high performance, low weight and volume, low power demand. Cost - a secondary goal.
Back, forth, up, down, for, against, ally, foe. Rolf Mowatt-Larssen, a 25-year CIA officer now at Harvard's Belfer Center, writes at Just Security: "If there is a silver lining in this disastrous trip, surely NATO, as well as leaders in Germany and the United Kingdom, must now realize that they cannot trust what the US President says, appears to do, or promises. This lesson will be useful for our allies in forging a more independent pathway moving forward, until this American nightmare is over." [The D Brief, Jul 18, 18]
DOD has released a memorandum that would authorize contracting officers to use a competitive procedure to procure “innovative” commercial technologies and services as part of four-year pilot program in a move to encourage participation from non-traditional contractors, Federal News Radio reported. DoD’s acquisition officials will release “general solicitations” and competitively pick [fixed-price] proposals based on a peer review conducted by subject matter experts under the “commercial solutions opening” method authorized by the fiscal 2017 National Defense Authorization Act. [Jane Edwards, GovConWire, Jul 17, 18] Keep in minds that military equipment has to be ready to deploy from the Arctic tundra to the rainforest tropical jungle next week.
Oh, those promises. The updated federal budget now includes a projected 2019 deficit of $1.085 trillion — more than double the $526 billion the White House called for in its 2018 budget. “This is a striking acknowledgement following almost two years of claims that economic growth unleashed by these policies will wipe deficits away,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. [Fiscal Times, Jul 16, 18] Never mind, the baseless hand-waving helped pass the Aid-for-the-Wealthy tax cuts, a prime Republican [donor] objective for decades. The Gilded Age with the best government money can buy is progressing nicely.
"We find tax cuts lead to higher reported capital income and a decrease in wage and salary income. These effects are concentrated among top earners, and we find no effects for those reporting less than $200,000 in income," the authors [Ethan Rouen of Harvard Business School and Suresh Nallareddy and Juan Carlos Suárez Serrato of Duke University] wrote. [Fiscal Times, Jul 13, 18] You of course are free to believe the econo-rantings of the Libertarian Knights of Over-Taxed Wealth. They voted against the woman by overlooking the charade of the alternative.
Mr Know-it-all. “I would have done it much differently,” Mr. Trump said. “I actually told Theresa May how to do it, but she didn’t listen to me.” [CHRIS STANFORD, New York Times,, Jul 12, 18] After all, who needs allies when he knows it all and doesn’t want to fix international institutions, just destroy them [Paul Krugman, NYT, Jul 12, 18]? For thinking about consequences of Trumpism, read the history of the US 1890s Gilded Age.
Endless growth arguments. A new analysis from the Federal Reserve Bank of San Francisco suggests that most growth estimates are too generous, and the U.S. economy may not see much additional growth in the wake of the tax cuts. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jul 11, 18] The taxcutters project what they want to hear, and the professional economists seek valid estimates. The US economy is so large and complex that estimates have wide confidence bands. Bottom line: the wealthy got what they paid a lot for, and the unwealthy will have to take whatever is left over. Whatever happens, the federal Treasury will be in ever growing debt as the nation endlessly spends on its imaginary credit card faster than it collects revenue to pay for its purchases. How depressing the the so-called conservative Republicans created the financial mess to encourage wealthy supporters to pay the Republican re-election campaign bills.
The British Business Bank, a public company owned by the U.K. government, unveiled last week a £2.5 billion fund called British Patient Capital that will make long-term investments in technology companies and others with high potential for growth. [Science, Jun 29, 18]
Venture capitalists now talk about “kill zones”, areas they will not invest in because one of the big players may squeeze the life out of startups or buy them up at a low price. [The Economist, Jun 29, 18]
Trump's shrinkgov plan Creating an energy innovation office to handle applied research programs at the Department of Energy (DOE) could improve coordination—but some groups see it as a way to dismantle DOE's Advanced Research Projects Agency-Energy. Trump ran on a pledge to shrink government, but to date he has shown little interest in winning over the law-makers who hold sway over such changes. ... But like previous reshuffling attempts by his Democratic and Republican predecessors, the plan is likely to face a tepid response from Congress. [Science, Jun 29, 18] Trump wins with his base when he thunders some grand pronouncement, true or false, that creates lightning. He will need continual thundering to divert attention from the many things that nevr happen or do more harm than good.
Competition and trade-war catching up. Xiaomi’s public debut was supposed to value the Chinese gadget maker at $100 billion and set the stage for a global coming-out party for some of China’s most successful technology companies. When Xiaomi finished its first day of trading, the company was worth only $48 billion, weakness that could hang over the rest of the Chinese tech players waiting to go public. [Alexandra Stevenson, NY Times, Jul 8, 18]
Six companies have secured positions on a potential five-year, $45 million contract to provide support services to a U.S. Army center established to develop and engineer software for weapons, training and combat support systems. [GovConWire, Jul 8, 18] One firm, Universal Technical Resources (Cherry Hill, NJ), had $1M SBIR in 2013.
Trade is two-way. A country that shuts out imports deprives its trading partners of money to buy exports. If the U.S., for any reason, cuts its imports from a trading partner, that country’s economy and currency both weaken, so it buys less from U.S. companies. The end result of President Trump’s efforts to make Americans spend more on American-made products is that foreigners will spend less, Greg Ip writes. [Jeff Sparshott, Wall Street Journal, Jul 9, 18] Unfortunately for everyone, our President pretends he can change just one thing.
Troll-in-Chief. In Mr. Trump we encounter a politician who uses social media to bypass the realm of ideas entirely, addressing the sentiments of his followers without a filter of educated argument and with only a marginal interest in what anyone with a mind might have said. [Roger Scruton, NYT, Jul 5, 18] As Michiko Kakutani writes in her new book, “The Death of Truth”: “Trump, of course, is a troll — both by temperament and by habit. His tweets and offhand taunts are the very essence of trolling — the lies, the scorn, the invective, the trash talk, and the rabid non sequiturs of an angry, aggrieved, isolated, and deeply self-absorbed adolescent who lives in a self-constructed bubble and gets the attention he craves from bashing his enemies and trailing clouds of outrage and dismay in his path.” [Maureen Dowd, NYT, Jun 7, 18]
[US] corporations have invested trillions based on the belief that world markets would remain open, that U.S. industry would retain access to both foreign customers and foreign suppliers. Trump wouldn’t put all those investments at risk, would he? Yes, he would [Paul Krugman, New York Times, Jul 5, 18]
The leader of a nonpartisan research organization in Washington described the administration’s [trade tariff] approach as a “whac-a-mole policy” that doesn’t account for the complexity of global commerce. “The law of unintended consequences abounds,” he said. [New York Times, Jul 5, 18]
Another unintended consequence: continued economic improvements aren’t likely to draw those older [retired] adults back to work. In fact, it could give them the confidence to retire in greater numbers. [Jeff Sparshott, Wall Street Journal, Jul 5, 18] Politically inspired generous retirement plans in good times from the 1970s on got surprised by the longevity and retirement readiness of the baby boomers.
Trump wants to bring other motorcycle companies to the U.S. to compete with Harley-Davidson [Patrick Leary, Milwaukee Business Journal, Jul 3, 18] What foreign company would trust doing business with a chaotic wheeler-dealer white nationalist?
Where fantasy reigns. Trumpâ€™s top economic adviser (i.e fantasizer), said on Fox Business that the federal budget deficit is falling â€œrapidly.â€ Fact check: No, it is not. The CBO report shows the deficit is rising, both in dollar terms and as a share of the economy. ... [The adviser said] his comment was meant prospectively. It reflects his view not that deficits have come down sharply, but that they will be coming down as growth rises â€˜faster than virtually any forecasters think.â€™â€ [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jun 28, 18]
Confident ethical techforce. In the past month, workers at Google, Microsoft, Amazon and Salesforce have organized and written letters calling on CEOs to cancel or review contracts with government agencies whose work the employees say raises ethical questions. [Ali Breland, The Hill, Jun 30, 18]
The challenge for Chinaâ€™s leadership is to maintain what it perceives as the benefits of the internet without letting technology accelerate political change. ... ... But the internet continues to serve as a powerful tool for citizens seeking to advance social change and human rights. The game of cat-and-mouse continues, and there are many more mice than cats. [Elizabeth C Economy, The Guardian, Jun 28, 18]
Economic reality check. the evidence so far is that the Tax Act has not resulted in significant job creation: The current low unemployment rate environment preceded the bill. And as of May 8, 2018, the Tax Act has resulted in more than $480 billion in stock buybacks, but only $7 billion in bonuses to employees. [Reuven Avi-Yonah, American Prospect, Jun 28, 18]
Spend, spend, elect, elect. lawmakers are pushing to increase funding to cover the cost of more [F-35 not ready for prime time with nearly 1,000 deficiencies remaining] aircraft. Lockheed has strong support in Congress, Capaccio notes, thanks in part to its network of 1,500 suppliers scattered across 46 states. [Yuval Rosenberg and Michael Rainey, Fiscal Times. Jun 26, 18] Where jobs for constituents, or wealth for the wealthy, are at stake, deficit spending is worth every penny to either political party.
Instability. Trump softens trade stance toward China and raises optimism. [AP, Jun 28,18] The Government fails one of its intended purposes, stability, when policy shifts from day to day on the whim of the President. Our current President has not yet advanced from sole owner of a private business to Chief Executive of a nation. So, domestic economic investment is still a guessing game despite all the promises of a Tax Cut law.
Good-bye manufacture. Harley-Davidson [said it] will shift production of motorcycles for EU destinations from the U.S. to its international facilities to avoid the [new] tariff burden,. [Evelyn Cheng, CNBC, Jun 25, 18] Harley employs more than a thousand unionized U.S. steelworkers—the very folks the President claims he’s protecting. Harley’s main manufacturing facilities are in Wisconsin and Pennsylvania, and Mr. Trump has said the “big league” support of Harley employees helped him win the swing states in 2016. [Wall Street Journal, Jun 25, 18] Trump raged in response that he would heavily tax Harley, a power he does not have.
Political infleuence. Compared to venture capital, the geography of SBIR/STTR deals is considerably less concentrated. Overall, less than half (44.2 percent) of the SBIR/STTR award dollars distributed between 2013 and 2017 went to the top 10 metropolitan areas. The top 10 metropolitan areas represent approximately 80 percent of all venture capital dollars, according to CityLab. [SSTI, Jun 20, 18] With just opposite politics, the Chinese government is concentrating industry in large metropolitan areas, some yet to be invented, in the equivalent of locating all US industry east of the Mississippi River. [The Economist, Jun 22, 18] Distributing government money to small and remote states comes from the Great Compromise of 1787 that gave Delaware and Rhode Island two Senators each.
Trade war news. The cascade of tit-for-tat tariffs has spooked corporate executives, potentially slowing investment, and the Federal Reserve suggested this week that it might have to rethink its economic forecasts if the trade wars continue. [Alan Rappeport, NYTimes, Jun 23, 18] Trump plans to ratchet commercial tensions with China even higher by barring many Chinese firms from investing in U.S. technology and by blocking more technology exports to Beijing. [Bob Davis, Wall Street Journal, Jun 24, 18]
The Least Prepared. A Generation of Americans Is Entering Old Age the Least Prepared in Decades. Low incomes, paltry savings, high debt burdens, broken family structures, failed insurance—the U.S. is upending decades of progress in securing life’s final chapter. According to a Wall Street Journal tally, more than 40% of households led by people aged 55 through 70 lack sufficient resources to maintain their living standards. [Heather Gillers,Anne Tergesen and Leslie Scism, Wall Street Journal, Jun 22, 18] We wonder what the trickle-down Tax Cuts and Jobs Act inventors had in mind for these lean decades, and how the affected millions will vote in the next election if and when their future dawns on them in the face of demonstrably false promises from the Republican Party.
Try our chaos method. [Britain] should take “inspiration” from Donald Trump in the Brexit negotiations and cast off Britain's "defeatist" attitude, according to the US ambassador to the UK. [The Telegraph, Jun 23, 18] Each day of his presidency seems to arrive de novo, disconnected historically from the day before. [Lance Morrow, Wall Street Journal, Jun 22, 18] Meanwhile, The furor over child separations at the southern border has deepened concerns among Republicans over the Trump administration’s often-chaotic and polarizing approach to tackling major issues. [Niall Stanage, The Hill, Jun 23, 18]
Since passage of the [Tax Cuts and Jobs] bill, the once in a generation tax overhaul championed by President Trump and Republicans in Congress has already provided numerous benefits and an even brighter future for the American people. [Mattie Duppler, The Hill, Jun 22, 18] [Note: The Hill disowns the opinion as "not the view of The Hill."] Americans could have done the same thing by deploying their credit cards to buy the good life and defer payment until "later." They will unwittingly start paying as the interest charges on the national debt rise as both the principal and the interest rate escalate.
[Since] the US is determined [ready to invest big] to keep the global top spot in quantum technology, it should avoid some mistakes: military in charge, inflexible allocation, too prescriptive, over-investing, America only [Martin Giles, MIT Tech Review, June 18, 2018] Nice guidelines but the US innovation investment system won't be so controlled.
Next up from the administration is a plan to halt Chinese investment in U.S. technology, due from the Treasury Department by June 30, as Trump thinks he has the upper hand in the trade dispute with China. [Bob Davis and Lingling Wei, Wall Street Journal, Jun 20, 18] The great deal-maker with the even greater ego.
The surge of retiring baby boomers is reshaping the U.S. into a country with fewer workers to support the elderly, sharpen the national debate on the role of immigration in the workforce. [Jeff Sparshott, Wall Street Journal, Jun 20, 18] And with low birth rates and high retirement rates among whites, the immigrants will continually gain an ever growing role in the economy and the electorate. Whatever your politics, the anti-immigrant advocates have no solution, and don't even admit the problem. Business knows better.
Naturalized Citizens No Longer Have an Assumption of Permanence ... U.S. Citizenship and Immigration Service formed a task force in order to identify people who lied on their citizenship applications and to denaturalize them. [Masha Gessen, New Yorker, June 18, 2018]
This is still a big open country, births are at a 30-year low and immigrants are an extraordinary source of national renewal. Those children being warehoused in Texas, as well as their parents, should be treated as assets to America, not liabilities, much less as criminals. [Bret Stephens, NY Times, Jun 19, 18]
All the children are above average [Garrison Keillor]. (medical research) Funding is harder to find in general, and the current approach favors low-risk research and proposals by older scientists and white men. [Aaron E. Carroll, NY Times, Jun 18, 18] a natural consequence of peer-review selection and decades of PhD degrees.
The mature democracies of the West are not yet in serious danger. Donald Trump may scorn liberal norms, but America’s checks and balances are strong, and will outlast him. The real threat is to less mature democracies, where institutions are weaker and democratic habits less ingrained. [The Economist, Jun 16, 18]
Committing atrocities at the border, attacking the domestic rule of law, insulting democratic leaders while praising thugs, and breaking up trade agreements are all about ending American exceptionalism, turning our back on the ideals that made us different from other powerful nations. We were the leader of the free world, a moral as well as financial and military force. But we’re throwing all that away. [Paul Krugman, NY Times, Jun 18, 18]
there’s a pretty good case that an all-out trade war could mean tariffs in the 30-60 percent range; that this would lead to a very large reduction in trade, maybe 70 percent; but that the overall cost to the world economy would be smaller than I think many people imagine, maybe a 2-3% reduction in world GDP. [Paul Krugman, NY Times, Jun 17, 18]
Budget cuts lead to closing of Kansas State research center [AP, Jun 16, 18] The famous Brownback supply-side tax cuts did not spur the promised economic growth.
Montgomery County, Maryland, recently launched the country’s first county-based match program. ... will target Montgomery County-based SBs receiving Phase I or Phase II SBIR/STTR [NIH] grants. Subject to appropriations, awards will be up to 25 percent of a Phase I grant ($25,000 cap), or 25 percent of a Phase II grant ($75,000 cap). ... [limit] one grant each year, up to five total grants. [SSTI, Jun 14, 18]
The costs of monopoly. “We were promised…if we cut taxes and allowed more inequality we’d get faster growth,” [Glen Weyl, an economist at Microsoft think tank] said in an interview. But the costs of monopoly—the excessive prices they charge—“have risen more than government taxes have fallen. So we have seen stagnation right along with inequality.” That conservative failure, following the failure of liberal policies in the 1970s, he said, is why “people hate the technocracy.” [Greg Ip, Wall Street Journal, Jun 13, 18]
Five years ago, a group of Duke University scientists developed a pioneering gigapixel camera to provide long-range surveillance for the U.S. Navy through a sponsorship from the Pentagon. The technology, never picked up by the U.S. government, is now being used by Chinese police to identify people from nearly a football field away, after lead Duke researcher David Brady moved to China in 2016 to kick-start his business Aqueti (spinoff of Applied Quantum Technologies ($2M SBIR), Durham, NC; no SBIR). .... The Treasury Department is proposing to block Chinese firms from acquiring advanced U.S. technology, using laws designed to deal with national-security emergencies ... Mr. Brady, who remains Aqueti’s biggest shareholder, said he has no qualms about aiding China’s surveillance system, which critics claim leads to humans-rights abuses. [Wenxin Fan, Wall Street Journal, Jun 11, 18]
Bigger, bigger, ever faster. Although impressive, Summit [can do mathematical calculations at the rate of 200 quadrillion per second, or 200 petaflops] can be seen as a placeholder. Supercomputers that are five times faster — 1,000 petaflops, or an exaflop — are in the works, both abroad and in the United States. The Energy Department’s budget for its advanced computing program is being increased by 39 percent in the two fiscal years ending September 2019, said Paul M. Dabbar, the Energy Department’s under secretary for science. [Steve Lohr, New York Times, Jun 8, 18]
Don't need no advice. Lawmakers [again] voted against reinstating the Office of Technology Assessment, ... When shuttered in 1995, had more than 140 staffers and a budget of $22 million.[Aaron Boyd, DefOne, Jun 10, 18] More employment for lobbyists.
Don't need no immigrants neither. Foreign-born founders start a huge number of America's most innovative businesses — including ones that support the Pentagon. But new government policies are making it harder for them to stay. [Sonia Paul, The Atlantic, Jun 9, 18]
Don't need no allies neither. If the U.S. was hoping for help from Western allies in confronting China's overcapacity in steel and damaging intellectual property practices, those prospects now appear dimmer. [Jeff Sparshott, Wall Street Journal, Jun 11, 18] As long as Congress allows it, Trump will keep playing King destroying the Empire.
No one is going to win the election based on fiscal responsibility. It is important but it is not a thing to win elections on. The question is, what is he [a candidate] going to say to people to make their lives better. [Matt Bennett, a co-founder of the center-left think tank Third Way, to The Daily Beast, Jun 6, 18] The credit card and Social Security society says: Give us stuff we want and defer payment until after we're gone.
Big finance. As a result of both the long-term trends and new policies implemented in the first year of the Trump administration, over the next decade, “nearly all growth in spending will go toward higher health, Social Security, and interest costs—with little left for almost everything else: infrastructure, research, education, defense, housing, and most basic government functions.” [Fiscal Times, Jun 5, 16] Note that the Congressional Budget Office reports that 34% of the money spent by the federal government in 2017 came from borrowing (the deficit); and in spending 64% went to Social Security and major health programs and 29% to interest on the national debt, which left only 17% for the entire rest of the government.
For those who missed the memo, SBIR is a "fair share" political creature masquerading as an economic investment program. A political report by SSTI says: SBIR/STTR awards by Metro (2013-2017) A look at how the more than 25,500 awards were distributed at the regional level over the five-year period from 2013 to 2017 yields additional insight. The metropolitan areas with the largest concentrations of SBIR/STTR awards include knowledge hubs with large universities and access to federal R&D, such as Boston, Los Angeles, and Washington D.C. Smaller regions with a large federal R&D presence, like Huntsville, Alabama, Santa Maria, California and Dayton, Ohio also rank highly. Read more . That's all input data, which government does well. You won't find any reports that evaluate it as an economic investment program, basically because Congress does not want to hear it. You will read of great success stories like Qualcomm and Cree but no allocation of investment return rate from SBIR's portion of the company's capital. Nevertheless, it is an opportunity for companies who don't mind doing business with the government for free capital.
Free lunch still popular. [Calif] State Sen. Josh Newman (D), who voted in favor of the gas tax increase in a district long held by Republicans, lost a recall election that will send former Assemblywoman Ling Ling Chang (R) to Sacramento in his place. [Reid Wilson, The Hill, Jun 6, 18] The free lunch is popular nationally as well as the populace likes the Republican tax cuts that pretend to be a jobs generator but will have little benefit to the middle and lower economic groups at the cost of a big rise in national debt.
If you build it. no reasonable business person thinks that enough new money can be introduced by increasing production alone (as supply side advocates claim). If they did, record amounts of cash wouldn’t be sitting in corporate bank accounts doing nothing, which is what has been happening for years now. Obviously, the people who control this cash don’t believe that supply creates its own demand. [Mark R Reiff, Aeon, Jun 4, 18] Sound obvious? Nevertheless, Republicans are still peddling the idea in their taxcut arguments for people who need only the slightest excuse to vote for a tax cutter. But, for all their huffing and puffing, politicians cannot change the laws of economics, even though they can decieve the unwary.
One hand giveth, one taketh away. Middle-income workers are getting a tax cut of $930 per year on average this year, but pricier fuel could claim about $320 of that, health care premium hikes about $612, and tariff-related costs about $210, according to Zandi’s estimates. “At best, breaking even,” Harwood concluded. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jun 1, 18] Apparently Trump believes that the base knows no economics and trusts the carny barker's claims.
Trade War: Game On. [Trump's latest protectuionist] move is almost certain to draw a response from the EU, which has threatened to retaliate with its own tariffs on American products such as motorcycles, jeans and bourbon. ... Don't be surprised if Canada and Mexico follow, escalating trade tensions with U.S. allies. [Jeff Sparshott, Wall Street Journal, May 30, 18] Wars are usually messy with nasty surprises for instigators. Protectionism: You're Doing It Wrong. China’s protectionism is future-focused, seeking to become globally competitive in industries such as aerospace, renewable energy and robotics. Mr. Trump, by contrast, seems obsessed with the past, when American coal, cars and steel ruled the world. [Greg Ip, Wall Street Journal, May 30, 18]
New York state
$47 million to Buffalo, Rochester for drug discovery research [through]
the newly created Empire
independent nonprofit that will promote pharmaceutical research [Dan
Miner, Buffalo Business Journal, May 23, 18] focused
on early-stage drug research, which advocates say can not only save
lives but also boost the local economy by creating good jobs and the
formation of new startups. [AP, May 30,
18] Stand by
for political influence in funding actions, although perhaps not as
egregious as a similar Texas fund.
The U.S. Department of Homeland Security has proposed repealing the International Entrepreneur Rule, a law that, in short, grants temporary visas to those foreign nationals who have raised at least $250K from investors in the U.S. Today's Axios Pro Rata argues the move "would be the most counterproductive piece of economic policy in recent memory." [Courtney Gabrielson, CincyInno, May 29, 18] Of course, there's no telling what the Trumpsters might do to feather their nests while pretending to govern.
Many [Europeans] see an America pulling away from the world order it shaped, the colossus at twilight, turning inward as other powers rise. [Richard Wike, DefenseOne, May 29, 18] Pulling up the walls and alienating the neighbors, thus surrendering the well-understood economic benfit of open trade for a political mirage of home-cooking benefits.
Reviving the spoils system. The president signed executive orders making it easier for the federal government to fire employees it considers to be poor performers. [Louise Radnofsky, Wall Street Journal, May 25, 18] Sounds good until someone defines "poor" performance, especially with regard to political loyalty. The protective shield around civil servants hired for their technical skill is a regular target for politicians wanting a little press attention by exploiting public dislike of the effects of inconvenient laws created by the complaining politicians.
Smoke and Mirrors. He has sold us a whole way of accepting a narrative that has so many layers of unaccountable, unsubstantiated content that you can’t possibly peel it all back. — Gwenda Blair, a Trump biographer, on the president’s fixation on conspiracy theories.
you can’t beat Trump at his own fantasy game. As Daniel Boorstin understood back in 1962, you can’t refute an image with a fact. Every pseudo-event “becomes all the more interesting with our every effort to debunk it.” Trump gets to monopolize attention ever more comprehensively and deepen his credibility as anti-establishment hero. [David Brooks, NY Times, May 24, 18]
The Greenwood consulting team reports on the USAF's becoming the lead innovator among DoD SBIR components with a series of 6 “special” topics in the DOD’s FY18.2 SBIR solicitation. ... limited to 60 day, $50k Phase I projects (plus 30 days, after proof of feasibility, to do the final report), followed by condensed (15 month), $750k Phase II efforts. Five of the special topics are based on interesting things like weather forecasting, logistics and supply chain issues, and counter-drone technologies. The sixth topic is a broad “other” topic, in which USAF asks the SBIR community to propose something that isn’t in Military’s customarily narrow SBIR topics—it is about as close as you will ever get to the DoD asking “do you have any ideas for things the US Military should be doing?” Note: Star Wars (then named SDIO) invented the surprises idea thirty years ago but abandoned it a decade later. Even with Surprises, the SDIO topics were already broadly open for ideas with categories like Sensors and Power and Materials and Superconducting. We needed big tech advances and were ready to fund risky ideas as long as they did not insult the Laws of Thermodynamics.
After rereading Mr. Trump’s book “The Art of the Deal,” our business columnist [Andrew Ross Sorkin] writes that the president’s negotiating playbook is on display: “Start with a headline-grabbing demand, beat chest loudly, then accept whatever is actually practical and call it a win.” [CHRIS STANFORD, New York Times, May 21,18] And depend on the loyal political base to believe they got something, which matters in politics but not in real estate deals by one-owner companies. Meanwhile Greg Ip [WSJ] observes: China, incredibly, appears to be winning its trade fight with the U.S. Though it is still early days, China has thus far escaped the bulk of threatened U.S. tariffs while giving up almost nothing of substance.
Campaign promises meet long term opponents. The Trump administration has suspended its plan to impose sweeping tariffs on China as it presses forward with trade talks .... trade experts warned that the suspension of tariffs could undercut Mr. Trump’s leverage and thrust the United States back into the kind of lengthy — and ultimately fruitless — negotiations with China that have bogged down previous administrations. [Ana Swanson and Alan Rappeport, New York Times, May 20, 18] Meanwhile, China’s government says it cannot guarantee renewed trade tension with Washington can be avoided after U.S. Treasury Secretary Steven Mnuchin said a spiraling dispute was “on hold.” [AP, May 21, 18]
We will need solutions to the problems produced by dropping fertility, including higher payroll taxes and increased immigration. The problem: too few births of future workers to suppoort the Social Security future finance. [Yuval Rosenberg and Michael Rainey, Fiscal Times, May 16, 18] But how will a President devoted to eliminating immigrants and taxes finance the US retirement future?
No-win jobs. Trump is unhappy with how [SECDHS Nielson] is running the massive agency according to two people briefed on the situation. ... In several negotiations since Trump was elected, Congress refused to give DHS the billions the agency requested to build his promised wall on the US’s southern border. Nielsen is being blamed in the White House for the omission, one of the people briefed said. [Heather Timmons, Quartz, May 17, 2018] Two hard-right politicians are being considered for the job which will probably see the same ending. Never mind, though, it's only a message for the "base".
The National Institute of Standards and Technology has updated regulations related to technologies that universities, large and small businesses, nonprofits and laboratories invent as part of federally funded research and development. ... applies to projects under government grants, contracts and cooperative agreements executed after Monday and works to streamline electronic reporting, enable automatic extensions for non-provisional patent applications as well as allow the funded entity to utilize its Cooperative Research and Development Agreement with a federal laboratory to support a license application. [Anna Forrester, executivegov.com, May 16, 18]
Not just the shooting. The U.S. has spent roughly $2.8 trillion fighting terrorism since 9/11, according to a new analysis from the nonpartisan Stimson Center, a think tank focused on security issues. ... A whole larger number from the Watson Institute for International and Public Affairs at Brown University put the total cost of war-related spending, including future obligations to veterans, at $5.6 trillion, or double the Stimson estimate. [Fiscal Times, May 16, 18]
DIY. from the President of the European Council, Donald Tusk, a former prime minister of Poland: "Looking at latest decisions of @realDonaldTrump someone could even think: with friends like that who needs enemies. But frankly, EU should be grateful. Thanks to him we got rid of all illusions. We realise that if you need a helping hand, you will find one at the end of your arm." ]Ben Watson, DefnnseOne, May 16, 18]
Fouled the nest before laying the egg. in perhaps a rich bit of irony, some Republicans also cite a broader public skepticism of anything Washington does [including a big tax cut for the 1%]: “We’re in an era where voters, whether on the left or the right, don’t think anything good ever comes out of government,” Rep. Tom Cole (R-OK) says. [Yuval Rosenberg and Michael Rainey, Fiscal Times, May 10, 18]
Tax break myth. Research on a program of corporate tax breaks in Texas found that 85 to 90 percent of the projects benefiting from such incentives would have gone forward without them. Even when tax breaks work and spawn new jobs, local residents gain little if anything. Timothy J. Bartik, an economist at the Upjohn Institute for Employment Research in Kalamazoo, Mich., estimates that eight of every 10 new jobs will be filled by outsiders. [Eduardo Porter, New York Times, May 8, 18] Politicians love the sound of their voices when they say "jobs," while dismissing the warnings of economists.
DARPA's "Gremlin" swarm drone attack and recovery program is picking up speed with a late-April "21-month, $38.6 million contract to Dynetics (Huntsville, AL; $6M SBIR)" the Washington Post reported this weekend. Dynetics will be working with " Kratos (San Diego, CA; no SBIR), a venture-funded tech company that specializes in cheap drones used for target practice." [DefOne, May 7, 18]
Navy's R&D Wing is Building a Lean, Mean Innovation Machine .... The initiative, dubbed Naval Innovation Process Adoption, is rooted in a problem-solving method called H4X, which distills business and design principles commonly used by startups and entrepreneurs into a structured system for innovation. [Jack Corrigan. nextgov.com, May 4, 18] Yeah, maybe. DOD over the last several decades has tried several such good-sounding managerial ideas, with multi-syllabic names, that try to instrumentalize imagination and risk-taking in a way that a bureau overseen by an elected Congress can accept. Good luck with that! What's more likely is that the Navy will scramble to adapt to the enemy's innovation. Meanwhile, the Navy will continue to seek brand new ideas that have been throughly tested.
More than 1000 Economists Invoke Great Depression in Warning to Trump on Trade. “Countries cannot permanently buy from us unless they are permitted to sell to us,” the economists say. .... [they] quote directly from another letter sent in 1930. [Bloomberg, May 2, 18] What do 1000 economists know about Trumpian politics that thunders economic myths to a fawning audience?
Talking big. Trump's demand that China zero its $200B trade surplus with US amounts to a request to substantially alter the way China manages its economy. [Greg Ip, WSJ, May 3, 18] Good US politics in Trump's base country with potential for depression in the rest of the country.
The Trump administration has already introduced measures that have restricted the flow of top researchers into the US. The latest plan would only benefit China, which is already doing its best to keep its top talent at home. [Will Knight, MIT Tech Rvw, May 1, 18]
Mike Griffin has orders to concentrate DOD’s diverse R&D on a few key technologies: hypersonics (for offense and defense); directed energy; machine learning and artificial intelligence; quantum science, including encryption and computing; and microelectronics, he wrote in [Congressional] testimony. [Patrick Tucker, Defense One, Apr 26, 18] Just the kind of job Mike had in the 1990s as early days Star Wars chief of technology. His mission then included SBIR which he encouraged to seek the best and brightest of small biz ideas for risky technology with a future - if it worked.
Send small biz
to war. Small
business policy objectives and programs, as executed today, do
not emphasize promoting small businesses that directly enable DoD to
better execute its missions. The pressures that DoD faces, and will
increasingly face, to execute its mission necessitate
a clear‐minded focus on leveraging small businesses
to maximize warfighting effectiveness. DoD should refocus its
small business policies, programs, and practices to maximize
warfighting capabilities and capacities. [DOD
Section 809 Panel report] More high talk on the merits of
innovation for US defense and the claimed inability of DOD to exploit
the nimble small biz in equipping the fighting forces with the best and
brightest stuff. One recommendation: more and better and faster SBIR in
line with the latest surge in new DOD innovation schemes and the
official belief that SBIR is a great program with proven
accomplishments. But, of course, beauty is in the eye of the
beholder. One aspect that bureaus don't do well is seeking what they
had not thought of and keeping their ears to the ground of new
developments in commercial technoogy. And it is hard to believe that
any DOD tech office would excel at such work. DOD already has an
organization that pushes the leading edge - DARPA- but does not
specifically focus on small biz as the source of the ideas. Three
decades ago one SBIR program had a topic of Surprises aand
Opportunities open to any technology that might help Star Wars (now
MDA) grab a revolutionary possibility. In its frst
ten years, nothing came across that threshold that quaified as
not already thought of and examined. The real thing was being done in
stealth companies funded by private capital out of sight of competition
which could mean enrmous profits if it worked. If it did
work, DOD could always buy it in the market.
With me, or against me. Our political system was designed to be deliberative [which] is a waste of time if minds cannot be changed. But today, partisans value purity and passion over persuasion. Opponents aren’t potential converts; they’re an abstract and unredeemable "them," and their tears, we’re told, are delicious. [Jonah Goldberg, NRO, Apr 25, 18]
“We have thousands and thousands of bronze windows, none of which closes. It’s a terrible waste of heat,” he said. Repairs have been delayed for years — because the Parliament did not want to pay for them, [William Booth and Karla Adam, WashPo, Apr 25, 18] The cream of 1840s technology has worn out. Expected repair cost - $5B plus six years displacement of the world's pioneer representative government.
US Supreme Court upheld a new government process for challenging the validity of patents, cementing a method [created by Congress in 2011] that technology companies and other businesses have used to knock out patent protections for more than a thousand claimed inventions. ... It allows private parties to challenge patents before the U.S. Patent and Trademark Office, a cheaper and faster avenue than going to court. [Brent Kendall, Wall Street Journal, Apr 24, 18]
Less science for policy. [EPA] announced a new regulation that would restrict the kinds of scientific studies the agency can use when it develops policies, a move critics say will permanently weaken the agency’s ability to protect public health. ... Senator Tom Carper and several Senate colleagues wrote, “Your proposed new policy likely violates several laws with which EPA must comply.” [Lisa Freedman, New York Times, Apr 24, 18]
in a recent report economists at Goldman Sachs studied the historical record and found that all else equal, every $100 boost to the budget deficit because of policy decisions (as opposed to economic developments such as a recession) raises the trade deficit by $35. In last week’s annual budget outlook, the Congressional Budget Office predicted the tax cut will nudge up economic growth, interest rates and the dollar, which sucks in more imports and discourages exports. [Greg Ip, Wall Street Journal, Apr 18, 18] Evidence, as opposed to political wishing, says that the Trump/Republican plans for taxcuts and trade wars will worsen the US economic posture. The only net beneficiaries will be the wealthy who can increase their share of the total wealth. Which can continue until the Trump "base" learns Economics 101.
Energy Department is looking to
partner with industry to build what would become the most powerful
supercomputers in the world. The agency published a request for
proposal worth up to $1.8 billion to develop two exascale
supercomputers, and a potential third supercomputer at some point in
the future. The systems, which would each cost an estimated $400 to
$600 million to build, are scheduled for completion between 2021 and
2023. The computers would outperform China’s Sunway TaihuLight
supercomputer, the most powerful machine in existence, by more than
tenfold and run 50- to 100-times faster than the current fastest
computer in the U.S. Technologists have hypothesized that exascale
technology, capable of crunching more than one quintillion calculations
per second, would mirror the computing power of the human brain.
[Jack Corrigan, NextGov, Apr 9, 18]
A grant program started by the European Research Council (ERC) to spur commercialization of basic research is showing success, an independent survey found. ERC awards basic research grants to individual researchers that typically pay €1.5 million to €2.5 million over 5 years. But in 2011 the agency started adding €150,000 supplemental [Proof of Concept (PoC)] grants to cover the initial costs of commercial development. ... Among recipients of these Proof of Concept (PoC) grants who responded to the survey, 42% reported filing at least one patent application, compared with only 17% of a control group who had unsuccessfully applied for PoC funding. [Science, Mar 30, 18]
He also traces useful continuities between Kremlin disinformation campaigns and Trump’s shameless mendaciousness: “Trump adopted the Russian double standard: he was permitted to lie all the time, but any minor error by a journalist discredited the entire profession of journalism.” [Christian Caryl reviewing Timothy Snyder's The Road to Unfreedom, WashPo, April 13, 18]
Falsehood diffused [with Twitter] significantly farther, faster, deeper, and more broadly than the truth in all categories of information, and the effects were more pronounced for false political news than for false news about terrorism, natural disasters, science, urban legends, or financial information. .... Contrary to conventional wisdom, robots accelerated the spread of true and false news at the same rate, implying that false news spreads more than the truth because humans, not robots, are more likely to spread it. [Soroush Vosoughi1, Deb Roy1, Sinan Aral, Science, Mar 9, 18]
“Small businesses are increasingly stuck in a bureaucratic twilight zone,” Senator Ron Wyden of Oregon, the top Democrat on the Finance Committee, said .... “There is rampant confusion about how the new tax law works — untested policies, sloppy legislative drafting and outright mistakes in the law. On top of that, a Trump cabinet turf battle has been adding to the uncertainty and lengthening the time that small businesses are going to be in the dark about how the tax rules apply to them.” [By ALAN RAPPEPORT and JIM TANKERSLEY, New York Times, APRIL 12, 2018] Enjoy the new tax break, if and when it ever arrives, and you can understand how it works.
Better late than never. The Army Research Laboratory is now setting up its own “open campus” [DIUx] in [Boston] to help make its innovation efforts more nimble and cutting-edge. [Caroline Houck, DefenseOne, Apr 10, 18] The Army, like all the other DOD services, has ignored three decades to juice innovation with a program named innovation - SBIR. Only war punched the innovation start button in the classic readiness mode of the USA from its beginning: first start or enter a war and then figure out how to operate. We'll see how well their "requirements" dogma handles new tech with military R&D.
Realism in testing. Trump in an early morning tweet warned Moscow that "nice and new and 'smart'" missiles would be headed to Syria, saying "Get ready Russia." "Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia, because they will be coming, nice and new and 'smart!'" he said. [John Bowden, The Hill, Apr 11, 18] Since any military would cringe at the idea of telegraphing an attack, this must be a new Trumpian vision of realism in testing.
Tribal reality. Trump’s takeover of the Republican Party is complete. Eighty-nine percent of Republicans now have a positive impression of the man. ... In any tribal war people tend to bury individual concerns and rally to their leader and the party line. As late as 2015, Republican voters overwhelmingly supported free trade. Now they overwhelmingly oppose it. [David Brooks, New York Times, Apr 9, 18]
Small biz snake oil. compared to large firms, small firms pay lower wages and provide fewer benefits, injure and lay off their workers more frequently, spend less to protect the environment, are less productive and less innovative, and create a smaller share of net new jobs. ... Heaping praise on small business may garner applause from the peanut gallery, but showering privileges on firms because of their size is bad economics and bad policy. [Robert D. Atkinson and Michael Lind, Wall Street Journal, Apr 6, 18]
Negotiating. Further escalation could be in the offing. The US treasury is working on plans to restrict Chinese technology investments in the US. And there is talk that the US could also put limits on visas. ... China’s retaliation so far has targeted Midwest farmers, many of whom were bedrock Trump supporters. [The Guardian, Apr 8, 18]
After so many decades of globalisation, economics and information have successfully grown beyond the authority of national governments. Today, the distribution of planetary wealth and resources is largely uncontested by any political mechanism. ... Trump’s office can never have the level of mastery over American life that Kennedy’s did, so he is obliged to fake it. ... He cannot put more money into the hands of the poor who voted for him, but he can hand out mythological currency instead; even his poorest voters, after all, possess one significant asset – US citizenship – whose value he can “talk up”, as he previously talked up casinos and hotels. Citizens who have nothing are persuaded that they have a lot. [Rana Dasgupta, Decline of the Nation State, The Guardian, Apr 5, 18]
Trade war bluster. Trump threatened a major escalation in trade tensions with Beijing, saying he was considering imposing tariffs on an additional $100 billion in imports from China. [Wall Street Jounral, Apr 6, 18] Seemed to work for him in real estate industry. Congress can rewrite the laws Trump uses for trade actions, since in almost all things government, Congress has the ultimate power. In the political realm, however, Mr. Xi enjoys advantages that may allow him to cope with the economic fallout far better than Mr. Trump can. His authoritarian grip on the news media and the party means there is little room for criticism of his policies, even as Mr. Trump must contend with complaints from American companies and consumers before important midterm elections in November. [Steven Lee Myers, New York Times, Apr 5, 18] For an estimate of what China can do, visit any large Chinese city (several you probably never heard of in the several millions people, like Tianjin 17M) and count the tall buildings and the containers in the ports.
A wall, a wall,
my kingdom for a
Sees 2,000 to
4,000 National Guard Troops at the Border
President says the troops, or a large portion of them, will remain until border wall is built. [Alicia A. Caldwell, Wall Street Journal, Apr 5, 18] A solution seeking a problem? Trump’s plan to deploy the National Guard to the U.S.-Mexico border is not likely to address immigration issues in any significant way. [Elaine Kamarck, Brookings, Apr 5, 18]
White House is now
considering its options
to roll back some of those increases [in non-defense agencies].
[Eric Katz, govexec.com, Apr 4, 18]
The barrier: those increases are now the law, that only Congress can
change. Appropriations are not just suggestions or options, and the
President cannot reverse his approval of the appropriation law.
Trump talks big about killing treaties made by previous administrations. If he does, why would anyone make any treaty with him or the US?
Robotics, artificial intelligence, and a willingness to strike the enemy's non-military targets will figure in [Russia]'s future strategies, reports Technology Editor Patrick Tucker. [Defense One, Mar 29, 18] Look for the DOD to eventually respond to the threat in their SBIR solicitations, but not this month.
Panic button. The Trump administration is preparing to limit Chinese investment in sensitive U.S. technology, ranging from microchips to 5G wireless technology, as it tries to prevent China from gaining an edge in industries projected to power the global economy for decades. [Ana Swanson and Alan Rappeport, New York Times, Mar 29, 18] Close the gates, raise up the walls, prepare to repel invaders, eject the young aliens, and accept an ever decreasing growth rate. For a preview, study Japan.
Showtime again. Ryan plans to bring a balanced budget amendment to the House floor for a vote, .... obscures the deeper problem in our nation’s capital: the inability to agree upon what the country needs and how to pay for it. After all, if Republicans are so serious about balancing the budget, there’s nothing stopping them from doing so right now, with or without an amendment. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Mar 29, 18] Since they just passed a trillion dollar debt increase for millionaires' tax cuts, and now need some TV illusions for their voters, trot out old show horse.
China returns fire in Trump's trade war, riasing tariiffs on 128 American products. Stand by for "He started the fight, ma, he hit me back.".
Our president, having engineered a big tax cut for his own business, tweets that Amazon should pay more taxes.
Trump is pushing for the Department of Defense to help build the border wall with Mexico, according to a report in The Washington Post. [Fiscal Times, Mar 27, 18] The DOD has long been a favorite source of funding for un-defense projects like breast cancer research. Trump has to learn how to negotiate with an independent Congress that rejects imperial presidents. If he ever wants to read, he could start with the Constitution.
Research and innovation funding rose 12.8 percent, to the highest inflation-adjusted level ever; Trump had called for the largest cuts in history. [Michael Rainey, Fiscal Times,Mar 26, 18] As long as the national credit card is open for purchases, life can be good. Meanwhile, Trump's puppet Treasury Secretary Steven Mnuchin called on Congress by to give President Donald Trump a line-item veto despite the Supreme Court ruling 20 years ago that the practice was unconstitutional. [WSJ Market Watch, Mar 26, 18]
The Senate Small Business Committee advanced eight bills last week, including legislation that would extend SBIR pilot programs to support commercialization, [SSTI, Mar 21, 18]
Opening a war. Trump announced he plans to slap tens of billions of dollars in tariffs and penalties on imports from China to try to curb what he described as its efforts to steal intellectual property from U.S. companies. .... Trump said that imposing tariffs on China is “going to make us a much stronger, much richer nation.” [The Hill, Mar 22, 18] Does he imagine the Chinese will accept his terms as they stretch to expand in the world?
DOEnergy awarded $1.5M to Mohawk Innovative Technology (Albany, NY; 100 SBIRs) for a High Temperature Anode Recycle Blower for Solid Oxide Fuel Cells – to develop modular, low-cost, oil-free anode recycle blower (ARCB) technology to increase efficiency and support a reliable balance of plant subsystems. The approach will build on a prototype developed during Phase I and implement production optimizations and simplifications to reduce blower unit costs. The project will culminate in a 1,500-hour test of Mohawk’s ARCB in a 200-kilowatt SOFC prototype system. [DOE press release, Mar 14, 18] Such a program is designed to reduce business risk of a technology that has been shown to work, not something that government should be doing to compete with private capital. Republican administrations used to object to such handouts, even firing the head of DARPA in the 1980s for advocating "dual use". Note also: SBA has again made it more difficult for the public to discover SBIR payout data in convenient form. Perhaps the huge accumulation of SBIR in several "SBIR mills" has caught the eye of Congresscritters from the flyover states. Note also: the present Secretary of Energy had a track record of handing out tech R&D money to politically favored entities when governor of Texas.
The federal helping hand. While the current role of the federal government has captured attention, it is worth noting the contributions of federal and higher ed technology commercialization policies– themselves innovative at the time – to both companies’ origins: Qualcomm’s roots trace back to an SBIR award, while Broadcom is the result of a UCLA spinoff and generous entrepreneurial leave granted by the institution. [SSTI, Mar 13, 18] Trump won hearty approval even among some staunch San Diego Democrats when he blocked Broadcom’s hostile takeover of Qualcomm. The news was joyously received [by] Qualcomm co-founder and former CEO and board chairman Irwin Jacobs ( a vocal SBIR booster) [Diane Bell, San Diego Union Tribune, Mar 13, 18]
Republicans yakking about new tax cuts as another free lunch with the $500B bill sent to the future. Live well on your credit card with no payments due - in your lifetime. How credulous are the voters? Judging by this week's Pennsylvania by-election, not as credulous as hoped. The U.S. government could spend more paying interest on its debt than it does on Medicaid by 2021 and the cost of debt service could surpass defense spending by 2024, according to a newly published analysis by the Committee for a Responsible Federal Budget. [Yuval Rosenberg and Michael Rainey, Fiscal Tims, Mar 15, 18]
Michael Griffin, defense undersecretary for research and engineering, has said the Defense Department needs to expedite its acquisition processes in order for the U.S. to remain competitive against potential adversaries, DoD News reported [GovConWire, Mar 7, 18]
Trump is his own nationalist economist. Talk loud and wield a big stick, worked for the mogul of a family real estate company, who got narrowly elected by appealing to the lowest economic class in half a dozen swing states. Now he takes no advice from the knowledgeable economists who do not run for office. He has his own political economic model apparently honed from long hours watching Fox News. And he believes in proof by loud and frequent assertion. Now he is launching a trade war on his own nationalist theory of international economics, with a Republican Congress unsure what to do about it in an election year. As aides head for the doors in record numbers, President Trump increasingly relies on his own judgment, in effect operating a presidency of one. [PETER BAKER and MAGGIE HABERMAN, New York Times, Mar 7, 18]
Swingers. In this divided country, if the two parties do not work together to find common ground, we are doomed either to gridlock or wild swings in policy —and we will never address the hard challenges of climate change and rising debt, which demand bipartisan consensus to share the pain as well as the benefits. [Alice Rivlin, Brookings, Feb 27, 18]
A bigger better umbrella. “We must no longer think in terms of building just ‘limited’ missile defense capabilities,” concluded a report that was issued last year by the Center for Strategic and International Studies, a Washington think tank. “The United States should begin the journey to develop a next-generation missile defense.” It called for pursuing a “space-based kill layer” that would try to shoot down swarms of enemy warheads and missiles — a step that would go beyond the Reagan administration’s “Star Wars” research on space arms and no doubt prompt new rounds of reaction from Mr. Putin and the Russian military. [DAVID E. SANGER and WILLIAM J. BROAD, New York Times, MARCH 5, 2018] Move and counter-move continue dancing in strategic space. A new, improved defense will need technology that does not yet exist - an opening for innovation with the DARPA mental approach. Trump and "my generals" have to seriously invest at technology's bleeding edge for hardware and doctrinal advances.
Trade wars are good, and easy to win. --- POTUS Trump. Investors speculated that the angry reaction of American allies, in particular the European Union, showed U.S. global leadership is fading and with it the dollar’s appeal as a reserve currency.The tariffs may also lead to a broader rethink of just how beneficial Mr. Trump is to the economy. [Greg Ip, WSJ, Mar 2, 18] .... The Obama administration imposed tariffs on Chinese tires. They cost consumers about $900,000 for every tire-making job they saved for a year. [Ramesh Ponnuru, AEI, August, 2017]
What idle politicians do. The Essential Act (H.R. 5091), introduced by Rep. Ted Budd, R-N.C., would require the Office of Management and Budget to maintain a database of every employee not excepted or exempted during a shutdown. The list would include the employees’ names, salaries and job descriptions, information that each agency would be required to submit to OMB. During two brief government shutdowns earlier this year, about 860,000 employees were scheduled to be sent home without pay. [govexec.com, Feb 28, 18] Another solution seeking a problem. How many new employees would be needed to manage that turbulent database?
President Franklin Roosevelt prophesied in 1938 when the world was much darker than it is today: “We observe a world of great opportunities disguised as insoluble problems.” [Michael Shermer reviewing Greg Easterbrook's It's Better than It Looks, 2018]
US officials have torpedoed a Chinese state-backed group’s plan to buy an American electronics company, signaling the Trump administration’s continuing skepticism toward Chinese investment deals, particularly those that involve transferring technological know-how. Xcerra (Norwood, MA; no SBIR), provider of equipment for testing computer chips and circuit boards, said this week that it was withdrawing from its $580 million sale to an investment group backed by a Chinese government-controlled fund. [Raymond Zhong, Wall Street Journal, Feb 23, 18]
Hope and hype. the White House Council of Economic Advisers (CEA) put out a detailed 568-page analysis of the Trump administration’s economic outlook. It predicts 3 percent growth through 2020, which would be 11 years into the latest expansion. “There's so much momentum in this economy,” said Kevin Hassett, chairman of the CEA, [Vicki Needham and Sylvan Lane, The Hill, Feb 25, 18] Hassett was a co-author of Dow 36000, well before the 2009 Great Recession dive.
Politics for grants. A senior adviser at the U.S. Department of the Interior will review certain grants and cooperative agreements of $50,000 or more to universities and nonprofit groups to ensure they “better align” with the priorities of President Donald Trump's administration. The move (without prcedent), follows a similar decision last summer by [EPA]. [Science, Jan 12, 18]
Subsidies lose favor. As New York's state Senate Republicans propose shutting down Start-Up NY, business leaders involved in the program say it's too early to call it quits. Start-Up NY, created by Gov. Andrew Cuomo in 2013, exempts qualifying businesses from taxes for 10 years when they expand or relocate to select college and university campuses. ... program approved 67 businesses in 2017. [Liz Young, Albany Business Review, Feb 20, 18] a number of legislative leaders and the state’s news media have been underwhelmed with the 408 jobs created by the program ... A case: Dr. Greg Galvin, cofounder of Incodema3D (Freeville, NY; no SBIR, founded 2001, a $10 million start-up investment financed mostly locally [Ijdavidhill, Ithaca Journal, Jan 21, 2015]) the first company certified within the Start-Up NY Program in 2014. The young company has grown from four initial employees to a staff of 30 over the past two years. ... Did Start-Up NY actually influence your decision to start Incodema3D? Dr. Galvin hesitated: “We would have started the company with or without Start-Up NY. But it certainly helped us succeed.” [Andrew Levine, Forbes, Aug 11, 16]
Getting what we want. Since the end of World War II, federal tax revenue has grown 15% faster than national income—while federal spending has grown 50% faster. [John Cogan, Wall Street Journal, Feb 21, 18] Our Congress cannot resist giving us what we want without our fully paying for it. What's more, the exploding defict estimates dramatically understate the full problem of promised retirement compensations for the future in both public and private pension plans.
Immigrants and their employers beware. The Senate could not reach a compromise immigration plan that the President would accept. Checks and balances in operation. In this case, the President is all-or-nothing to mollify his small political base, despite his personal preference of cheap immigrant labor in his businesses. If there is no compromise, then the President is free to execute wide and arbitrary arrest and deportation of whomever he chooses, subject to due process in immigration courts. The Republican political dilemma is that a large majority of the public supports the Dreamers while Trump holds them hostage to his other demands.
Cut small biz? Trump's fantasy budget cuts SBA 25%, unlikely to get past Congressional defense of beloved small biz. Also, The president’s budget says it will achieve its targeted Medicare savings through a host of vague reforms, the famous abstract asterisks of David Stockman, to avoid activating lobbyists. On the other hand, Lawmakers scoffed at the president's calls to slash funding across the government a year ago, and they're likely to do so again. [Russell Berman, govexec.com, Feb 13, 18]
A trillion here, a trillion there, and pretty soon you're talking real money.-- update of Everett Dirksen, Republican Senate leader half a century ago. White House Proposes $4.4 Trillion Budget That Adds $7 Trillion to Deficits [New York Times, Feb 13, 18] As Trump, self-anointed king of debt, proposes trillion scale deficits to a Republican Congress infested with deficit hawks and former fiscal conservatives. His novel infrastructure proposition presumes that the states have the same suicidal freedom for deficit finance to provide the matching funds for his federal largesse. How's your state fixed to get the federal money while watching state pension funds fall further behind?
Call to trade war. Trump also said he planned to announce as soon as this week what he called a ‘reciprocal tax’ on trade, aimed at countries that he said are taking advantage of the U.S. [Wall Street Journal, Feb 13, 18] 'taking advantage" is one of those things in the eye of the beholder.
Today, after the financial crisis, the shrinking of the middle class, the partisan warfare, a scarcity mind-set is dominant: Resources are limited. The world is dangerous. Group conflict is inevitable. It’s us versus them. If they win, we’re ruined, therefore, let’s stick with our tribe. The ends justify the means. The scarcity mind-set is an acid that destroys every belief system it touches. [David Brooks, New York Times, Feb 13, 18]
So far the corporate sector has responded to the 21% tax rates by announcing $86 billion of new stock buybacks and some ill-disguised PR ploys with respect to year-end "bonuses" that they would have largely paid anyway. [David Stockman's ContraCorner, Feb 9, 18]
Looser enforcement.“The Brand memo puts government contractors in a better position when negotiating and defending False Claims Act cases where they are accused of violating a government policy as part of a so-called conspiracy to defraud the U.S. government.” [Robert Pear, New York Times, Feb 10, 18] SBIR awardees are sometimes accused of fraudulent practices in accounting and reporting.
Dreaming Again. Making good on last year's promise to remake government "starting from scratch," the Office of Management and Budget signaled that Monday's fiscal 2019 budget proposal will include a shift from "tenure-based" civil service system pay to performance-based bonuses. [GovtExec, Feb 9, 18] A favorite conservative dream that government work can be economically valued. Last tried in Carter administration as Merit Pay and eventually abandoned as unworkable.
Perfect representation. There is no congressional appetite for spending control because there is no public appetite for it. [Peggy Noonan, Wall Street Journal, Feb 9, 18] The path of least resistance in politics is to give the people what they want, while concealing the burden that the people also have to pay for it. Thus, we have a huge tax cut (and mythical jobs) law and now a budget deal that spends even more. Enjoy the ride!
Too successful? The federal antitrust case against Microsoft started after states investigated the company’s conduct; Texas played a pivotal role in handicapping Standard Oil in the 1880s. The Sherman Act of 1890 followed and by 1911—before the Clayton Act was even passed—John D. Rockefeller’s pride and joy, the greatest company of its day, was lying on the floor in 34 parts. Knowing that a consultant in Washington refers to Amazon, Facebook and Google as “Standard Commerce, Standard Social and Standard Data” should make you shudder. [The Economist, Jan 20, 18] Capitalism left to its own devices would reproduce JD Rockefeller and JP Morgan.
An anti-missile test missed its mark, as have about half the tests since the system was declared operational. [Helene Cooper and Eric Schmitt, New York Times, Jan 31, 18] How do you feel about Trump's claim of 97% kill probabiility against NoKor launches? If a single kill probability is 50%, how many shots have to be fired to get a 97% mission kill probability? Do we have enough missiles and time to stop a multiple launch attack?
No president in living memory has spent so much time in their State of the Union address applauding himself. -- [Nicky Woolf, New Statesman (UK), Jan 31, 18]. Every rooster claims credit for a sunrise.
Language matters. Modern history’s two greatest war leaders were masters of the English language. Their pre-eminence rests not only on a genius for waging war but also a peerless gift for explaining why it needed to be waged. ... Lincoln’s prose, borne of his immersion in Shakespeare and the King James Bible, invested the Union cause with a moral majesty that sanctified a fratricidal conflict. Churchill later found another greatness by delivering on his promise that “history will be kind to me, for I intend to write it.” [Michael Bishop reviewing Lehrman's Deeply researched and elegantly written Lincoln and Churchill, WSJ, Jan 27, 18] "Fake news" will not inspire a people to greatness.
Marginal propensity to consume. Moody's says: we do not expect corporate tax cuts to lead to a meaningful boost in business investment, which has remained tepid despite a supportive economic environment characterized by low interest rates, low inflation and strong corporate earnings. We believe it is likely that US nonfinancial corporates will prioritize activities such as share buybacks, M&A and paying down existing debt over investment beyond that already planned. ... More than three quarters of the $1.1 trillion of individual tax cuts over 10 years is expected to go to those making more than $200,000 a year in taxable income. This group represents 5% of all taxpayers. These individuals are likely to spend a relatively small portion of their tax savings on current consumption, limiting the impact on the economy.” [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jan 25, 18] The taxcut pushers choose to ignore or deny the realities of basic economics.
The Solar Energy Industries Association warned the [Trump America First] 30% tariffs will delay or kill billions of dollars of solar investments. [Bloomberg, Jan 23, 18] Meanwhile, Eleven Pacific Rim nations agreed to forge a new trade bloc excluding the U.S. [Wall Street Journal, Jan 23, 18] Not something a real-estate mogul would worry about when casting for votes from US workers [who may or may not be helped by the tariff. Tariffs are like a lot of other changes: you can never change just one thing.
Nuclear torpedo. A leaked copy of the Nuclear Posture Review appears to confirm that American officials are taking seriously Russian plans to develop an autonomous nuclear torpedo designed to destroy an adversary port and shower it in nuclear contamination. [Foreign Policy sitrep, Jan 22, 18] The genie is wriggling to get out of the bottle and devastate its inventors.
DOD's Innovation Board recommended several things to spur the adoption of innovation: Design a fast track for new technology initiatives; Start an incubator; Create an innovation + STEM career field; Establish technology and innovation training for senior DoD leaders. [Patrick Tucker, DefenseOne, Jan 17, 18] Great ideas for the likes of Google, where the Board's chair Schmidt excelled. But DOD has had thirty years and three wars with a possible startup program - SBIR - languishing in low return contracts with small private firms.
Trump celebrates his first anniversary in "America First" office by engineering a shutdown of his government, a tactic that he recommended many months ago.
“DoD does not have an innovation problem; it has an innovation adoption problem,” reads one of the new recommendations from the Defense Innovation Board. It even has an “innovation theatre” problem: the preference for small cosmetic steps over actual change. The advisory is chaired by former Alphabet chief executive Eric Schmidt. Their latest report suggests that the Pentagon too often tends to squelch its new ideas with outdated bureaucratic models and obsolete cultural notions. [Patrick Tucker, Defense One, Jan 17, 18]
Trade War? The last time Washington mobilized for a trade war, Ronald Reagan was president and Japan the adversary. ... Today, the White House is readying the same big guns—a mix of tariffs and quotas—aimed mainly at Chinese imports. ... A trade war isn’t a certainty, but if it comes, it will look nothing like the battles that raged in the 1980s over Japanese semiconductors, cars and TV sets. .... “A trade war is coming because of ideological zealotry and absolutely contradictory estimates of who has more leverage,” says Scott Kennedy, an expert on Chinese industrial policy at [CSIS]. [Andrew Browne, Wall Street Journal, Jan 16, 18]
Star Wars technology is coming not only to a theater near you, but to a job near you [via quantum computers]. We need to be discussing and adapting to its implications as much as we do Trump’s tweets. [Thomas Friedman, New York Times, Jan 16, 18]
Forth boldly , and back. Under intense pressure from the business community, the Trump administration appears to be backing away from a proposal that could have forced foreign tech workers out of the country. The U.S. Citizenship and Immigration Services (USCIS), said it was still conducting a thorough review of worker visa programs. But after McClatchy reported that the agency was weighing a specific law change that would prevent foreign tech-industry workers from keeping their visas longer than six years, the agency reversed course. [Franco Ordonez, McClatchy Washington Bureau, Jan 9, 18]
All against all. As Henry Kissinger has rightly observed, the internet has re-created the human state of nature depicted by 17th-century English philosopher Thomas Hobbes, where there rages a war “of every man against every man” and life (like so many political tweets) is “nasty, brutish, and short.” Those who favor a revolutionary world run by networks will end up not with the interconnected utopia of their dreams but with Hobbes’s state of nature, in which malign actors exploit opportunities to spread virus-like memes and mendacities. [Niall Ferguson, Wall Street Journal, Jan 5, 18]
I believe virtually everyone of prime working age who wants and is qualified for a job is already employed. thus I don’t expect corporate tax cuts to produce higher wages or robust job growth in a full-employment economy -- Howard Gold’s predictions [MarketWatch, Jan 3, 18]
---------------------------------------------------------------------- 2018 -------------------------------------------------
---------------------------------------------------------------------- 2017 ---------------------------------------------------
SBIR Insider, Rick Shindell, is back on the air reporting that although SBIR has been re-authorized until 2022, there are proposed changes afoot in two separate House [H.R.2763] and Senate [S1961] "improvement" bills about which there is no legislative agreement. One definite change is the end of the "pilot" programs. He also notes that the Congressional and Presidential struggles with Continuing Resolutions downscales SBIR's attention in the R&D agencies. And SBIR Insider email address has changed to firstname.lastname@example.org This and back Issues of the SBIR Insider are available at www.zynsys.com/sbir/insider
“NASA iTech is an innovation incubator that brings together the right people to the right place and time, giving entrepreneurs an opportunity to present their technologies as a future commercial market product solution for both Earth and NASA,” said Kira Blackwell, program executive for the Space Technology Mission Directorate at NASA Headquarters. Blackwell, also said the top 18 companies that have previously participated in NASA iTech have reported raising more than $50 million in private investments over the last 12 months. The top ten competitors for the grand prize: BioVirtua (San Francisco, CA; no SBIR) Humanizing Telehealth in Four Dimensions; FGC Plasma Solutions (Argonne, IL; no SBIR) Novel Fuel Injectors to Enable Clean, Compact Propulsion ; Germfalcon (Los Angeles, CA; no SBIR) Germicidal UVC Emitting Robot for Commercial Aircraft; H2 Energy Now (Boalsburg,PA; no SBIR) New Technology for H2 Generation from Water in Space by Use of Electromagnetic Waves; Hyperloop Tansportation Technologies (Los Angeles, CA; no SBIR, 500-1000 employees) Augmented Voyage; iFirst Medical Technologies (Honolulu, HI; no SBIR, founded 2016) The iFirst Analyzer: Handheld Laboratory-grade Diagnostics Platform for Extreme Environments; Million Concepts (Lemont, PA; no SBIR) The Arisian Lens: A Novel Solution for Low-cost, Lightweight Microscopy; New Frontier Aerospace (Livermore, CA; no SBIR, founded 2015) Affordable, Powered Recovery for Small Launch Vehicles; Rice Technology (Milwaukee, WI; no SBIR) Smart Real-Time Multipurpose Sensor - Dissolved and Suspended Solids, Bacteria, Phosphorus and Viruses; Somatic Labs (Phoenix, AZ; no SBIR, founded 2015) Tactile Interfaces for Augmented Reality to Enhance Communication.
If President Trump would read only two chapters of this book, he should read the one called “Tomorrow” and another titled “Confidence,” where Goldfield tells the real story of how to make America great again. But neither Trump nor any other Republican is likely to read this because, as Goldfield shows, government was the key that made America a colossus in the world economy and the generator of a robust middle class. [Elaine Kamarck reviewing The Gifted Generation: When Government Was Good By David Goldfield, WashPo, Dec 23, 17]
Buyer's Remorse on tap. The [new proudly conservative] tax law will have a tiny effect on economic growth after a decade, Congress’s official scorekeeper said. The Joint Committee on Taxation said that gross domestic product would only be 0.1% to 0.2% larger by 2027 thanks to the tax overhaul, which includes $1.5 trillion in tax cuts and is expected to add about $1 trillion in deficits. [Wall Street Jounral, Dec 22, 17] But the annual bill for interest on the bigger federal debt will expand income growth in bond buyers. It's the price the Republicans were willing to pay for the financial support by the extremely rich donors who threatened to dry up the money if not rewarded with tax cuts. One glaring conflict-of-interest beneficiary is the POTUS. The people will get their chance to vote on the deal next November.
University of Michigan team aims to create an unhackable computer with a new $3.6 million DARPA grant [one of nine that DARPA has recently funded through SSITH]. Todd Austin, U-M professor of computer science and engineering, leads the project, called MORPHEUS. Its cybersecurity approach is dramatically different from today's, which relies on software—specifically software patches to vulnerabilities that have already been identified. It's been called the "patch and pray" model, and it's not ideal. This spring, DARPA announced a $50 million program in search of cybersecurity solutions that would be baked into hardware. [Nicole Casal Moore, Michigan News, Dec 20, 17]
Thinking NASA SBIR January 11, 2018? NASA says We made the proposal submission process easier for you by creating a new system that will work with you, and not against you, so you can focus on submitting a winning proposal. Webinar Jan 9. See the guide. Beware: agency procedures are for the benefit of the agency. A helpful agency would be brutally clear about what it is looking for. Remember that at bottom there is no good substitute for being the very best at what you do, and that many, many companies already know the buzzwords NASA wants to hear.
Struggle, not age, criterion. After announcing a plan this May to award 400 additional grants each year to early- and mid-career scientists who fall within a specific definition, (NIH) decided to revise its funding strategy ... now aims to focus funds on researchers who are struggling to keep their labs afloat, regardless of age. “Age should not matter,” NIH Principal Deputy Director Larry Tabak said. For the NIH, this is the third shift in funding policy this year. [Katarina Zimmer, The Scientist, Dec 19, 17]
The National Security Strategy concocted by our adolescent real-estate mogul President as Defense One's Patrick Tucker reports, the NSS appears to give up on the idea that American ideals are themselves a competitive advantage. "Through omission, it signals U.S. retreat from the tradition of democracy promotion with an overt criticism of the theory of 'democratic peace,' the idea that democratic governments are more akin, and therefore more likely to act peacefully toward one another," Read on, here. .
Eating dessert first. In passing the tax bill and then promising spending cuts later, Republicans are attacking the GOP policy menu like their predecessors - dessert first, vegetables later. It's a replay of the experience under former President George W. Bush, who powered through tax cuts in 2001 and 2003 and the creation of a Medicare prescription drug benefit in 2003 as well. But when the agenda turned to cutting spending, particularly a 2005 bid to shore up Social Security, Bush flopped badly, while the tortured legislative path later that year to enact modest spending cuts of $40 billion over five years proved almost comically difficult. In the 2006 midterms, the GOP president and Republicans lost control of the House and Senate. [Andrew Taylor, AP, Dec 19, 17] The day will soon come for "Don't let the government touch my Medicare," nor my sacred science.
Rich kids patent more. The weight of the evidence suggests that the most effective way to generate new innovators is by reducing poverty, improving social mobility, and making sure that more communities can point to homegrown innovators for children to emulate. And there’s little reason to think the tax bill will help on any of those fronts. ... ... a team of researchers at the Equality of Opportunity Project, studied more than 1 million inventors in the U.S. to determine the factors that affect who ends up filing a patent ... “Becoming an inventor relies upon two things in America: excelling in math and science and having a rich family.” .... research has found that social welfare programs increase the number of people who start new businesses. [Walter Frick, Harvard Business Review senior editor, Dec 15, 17] Read the NBER paper.. but don't expect any help from Republicans; watch instead for attacks on those nasty "entitlements" to fill the deficit gap caused by the new great trickle-down tax cuts.
Good news: climate change is not a national security threat, says our President. Evidence? Better you shouldn't ask. And the trickle-down tax cut will more than pay for itself. In both cases the majority of experts say the opposite. You judge for yourself on who speaks the truth.
Jackpot for POTUS. Trump is about to hand corporations -- which are already making high profits by historical standards -- a giant tax cut. The bill “addresses problems we don’t have, and makes existing problems worse,” said Alan Krueger, an economics professor at Princeton University. “Especially the deficit, inequality, health care, and infrastructure investment.” [Craig Torres and Jordan Yadoo, Bloomberg, Dec 15, 17] See it from Trump's perspective: he gains a billion dollars while telling his base that he is fighting for their economic and cultural cause, and while they don't seem to notice the disconnect.. In fact: “If enacted, the commercial real-estate industry will have hit the jackpot,” said Steven M. Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center.
Paying the supporters. The proposed tax cuts are paid for by bigger budget deficits, a fiscal stimulus that is ill-timed given the business cycle. But the tax cuts favour companies (which in aggregate are generating bumper profits) or rich individuals (who save more of their income). That means the ripple effects from the stimulus are likely to be small. [The Economist, Dec 15, 17] Responsible governments use deficit spending to some useful purpose, typically to rally a sunken economy; irresponsible governments use deficits to bribe supporters. Trump Inc, self-professed Master of Debt and serial liar, does the latter while claiming the former.
Wishes Trump science. Trump administration gives CDC a list of forbidden terms, including fetus and transgender. Instead of “science-based” or “evidence-based,” the suggested phrase is “CDC bases its recommendations on science in consideration with community standards and wishes,” one analyst attending a meeting with senior officials said. [Lena H. Sun and Juliet Eilperin, Washington Post, Dec 16, 17]
Your SBIR manager distracted? The Trump administration’s consideration of a wage freeze for federal employees is one piece of a renewed multifront Republican push to shrink those workers’ pay, benefits and workforce. .... Now, with James Sherk — a chief proponent of the notion that federal workers are overpaid — serving as Trump’s labor adviser, the proposals stand their best chance yet of becoming policies that dig deep into federal employees’ pockets. [Joe Davidson, Washington Post, Dec 17, 17] Trump apparently believes that the best government is one operated like a for-profit buiness, especially his. The civil servce however is a service, not a profit center; it executes the laws enacted by the Congress in accordance with the rules also set by Congress. The President does not have the power to change those laws or the mandated rules.
A spokesman for the Defense Department has said defense contractors must have “system security plans” in place by Dec. 31 to comply with the NIST federal data protection regulations, Defense One reported [GovConWire, Dec 14, 17]
Tax Bill last call. Republicans in the House of Representatives have passed a bill that would prevent many graduate students in the U.S. from pursuing advanced degrees. Writing for MIT Technology Review, climate researcher Ken Caldeira says that's an awful idea. [technologyreview.com, Dec 12, 17] Apparenly, the fix is in as the big donors get what they demand; finals details pending.
With enough assumptions, ... Treasury produced a report that purported to support the administration’s conclusions [on GOP tax plan]. It was, in fact, a one-page news release containing no actual analysis or data, just fairy dust. Rather than calculating the growth rate produced by the Senate tax plan, or any tax plan at all, the release merely . . . assumed a big growth rate. Then it said that if that growth rate happened to materialize, the plan would produce a whole lotta revenue. Enough to plug a big budget hole, even! [Catherine Rampell, WashPo, Dec 11, 17] Trickle-down is a hard sell to realist economists despite piles of money boosting the politics.
Where you stand depends on where you sit. During his election campaign, President Trump frequently described the jobs numbers as “totally fiction,” “a complete fraud” and “phony numbers.” But after assuming office, amid reports showing strength in the economy, Mr. Trump said, “They may have been phony in the past, but it’s very real now,” according to an account by Sean Spicer, the former White House press secretary. [Justin Wolfers, New York Times, Dec 10, 17]
Adding to the national debate regarding U.S. immigration policy, the Center for American Entrepreneurship (CAE) reviewed the 2017 Fortune 500 list, finding that 43 percent of the companies were founded or co-founded by a first or second generation immigrant. Those companies account for 52 percent of the top 25 firms, are headquartered in 33 different states, and accounted for $5.3 trillion in global revenue in 2016, the CAE analysis found. [SSTI, Dec 6, 17]
The National Endowment for the Humanities awarded $300,000 to the Denver Museum of Nature & Science as part of NEH’s Sustaining Cultural Heritage Collections program[to] support a three-year project to sustainably preserve 72,000 objects from the Museum’s archaeology collection. [Museum press release, Oct 27, 17] Look in the latest tax bill for a hidden line item canceling NEH which the troglodyte Republicans detest.
Military innovation barrier. our defense and intelligence agencies were built to efficiently and constantly apply resources to ensure the security of our country. The systems that make this possible are not capable of sustaining an innovation ecosystem – nor should they be expected to. In execution organizations, the important metrics concern the efficient use of limited resources. People, vision, culture, and systems are optimized to do more with less. Duplication and redundancy are signs of inefficiency that must be corrected. Failure is to be avoided at all costs. Within such systems, innovation has no seat at the budget table, few resources, and no friendly metrics. ... Nor is there an incubation phase that might refine ideas before sending them for execution, which often results in the delivery of immature solutions into a system that is already overburdened just trying to maintain the status quo. [Pete Newell, Defense One, Dec 4, 17] Innovation blooms on the battlefield when the enemy starts stinging the conventional force. MRAPs, anti-IED robots, dogs, drones, pagers in Desert Storm, etc.
Government scientists working at U.S. defense laboratories will soon have an opportunity for up to $500,000 per year if their research is a commercial success. Congress hopes the raise will prod the military to do a better job of commercializing discoveries that have civilian as well as battlefield uses. ... creates a 5-year experiment that more than triples the annual royalty payments—now capped at $150,000—that DOD inventors can collect on their patented inventions. [Jeffey Mervis, Science. Nov 24, 17]
NASA says it is modernizing its SBIR. streamlining complex processes where possible, enhancing the Solicitation, and upgrading our system so that you can focus on submitting a quality proposal to get your innovation into NASA’s missions and into the commercial market. The new system is more modern, intuitive, and user-friendly. Smoother road to the same safe mediocre projects?
Senate Republicans, in their push to pass a sweeping tax bill, undermined a research-and-development tax credit many companies use to encourage innovation, and business interests are in revolt. [Richard Rubin, Wall Street Journal, Dec 3, 17] They had to find money to meet their wholly arbitrary $1.x trillion addition to the national debt over the next decade. Their great deal so far is full trickle-down like Reagan and W's tax plans that have contributed to the growing economic inequality analyzed by Piketty and others. Whatever the final tax law, those affected will find new ways to circumvent the limits and upset the economic and political calculations. But in the future years, the economy will have so many drivers that no definitive good or bad economic outcome can be credibly attributed to the great 2017 tax reform. The partisan politics of that future time will swamp any historical analysis.
Biomedical engineers at Duke have created a fully functioning artificial human heart muscle large enough to patch over damage typically seen in patients who have suffered a heart attack. The advance takes a major step toward the end goal of repairing dead heart muscle in human patients. [Raleigh newsobserver.com, Nov 30, 17]
CEOs (“the most excited group out there,” according to the bill’s architect, Gary Cohn) have given away the game in earnings calls by admitting that the corporate tax cuts, easily the largest chunk of the bill, would flow out to shareholders in dividends and stock buybacks, rather than used to create jobs or raise wages. [David Dayen, The Nation, Nov 28, 17] Never mind; the promises and the logical disconnects are needed to paint the necessary scrim to cover the barely majority political consent to economic wishful thinking. But the politicians are safe because the economy is so big and so varied that any future blame will be washed away in cherry-picking the enormous economic data. And future elections will still focus on emotion-stirring cultural issues that got Trump elected.
Quiet oil-fueled Texans. For 300 million years faults showed no activity, and then wastewater injections from oil and gas wells came along. In Texas, sixfold increase in quakes since 2008, yet the Texas government has not officially accepted the link to one of its most lucrative industries. [Anna Kuchment, Scientific America, Nov 24, 17]
Safety first. when scientists must get their very salaries, and universities their operating funds, from individual grants, a conservative, defensive, safe, assembly-line, and eventually sclerotic system that always promises future miracles is as inevitable as sunrise. It’s what we have today. ... If changes in the research funding system relieved investigators from the relentless scramble for funds, they could be freed to do truly creative work. [Kenneth Weiss, Issues in Science and Technology, Fall 2017] All of which is true but impossible to avoid when public funds are sought. The taxpayers representatives would rather report something good almost all the time than an ocasional Eureka inventing the transistor or DNA.
With the Senate poised to begin consideration of the Republican-authored tax overhaul proposal this week, a new coalition of small business leaders wants to put lawmakers on notice that most of them don’t like the proposal. Businesses for Responsible for Tax Reform is touting a poll today, shared first with McClatchy, showing 51 percent of small businesses oppose the plan, while 34 percent expressly support it. (Sacramento Bee) [Nov 27, 17] The main question is how much will the Senators have to give up to keep their big tax cuts for their rich contributors who are unhappy with the delays.
ten months into his presidency, Donald Trump has yet to name a science advisor. [technologyreview.com, Nov 27, 17] If science matters not to governing philosophy, a science advisor would just be a political liability.
Economic nationalism is real, and while it will disappoint its backers, it presents a serious danger to Washington state [which]which proudly claims to be the most trade-intensive state in the union. ... The policymaking giants after World War II believed that the conflict and its roots were partly found in the beggar-thy-neighbor trade stances of nations after the First World War. ... “America First” also threatens the openness that has made Seattle a magnet for international talent. [Jon Talton, Seattle Times, Nov 18, 17]
A better small biz tax deal. What [Sen]. Johnson needs is to treat more favorably small businesses and other so-called pass-through entities — businesses whose profits are distributed to their owners and taxed at rates for individuals. Such entities account for more than half of the nation’s business income, and the senator says the tax bill would give an unfair advantage to larger corporations. [Jim Tankersley,New York Times, Nov 18, 17] Small biz asks for breaks; big biz buys their breaks. As Chris Collins, a Republican representative from New York put it: “My donors are basically saying, ‘Get it done or don’t ever call me again.’” .... elections have consequences, and Republicans have never hidden their desire to cut taxes. They now have the power to do so. But it would be a mistake to exercise that power. Tax cuts for the wealthy would not alter the supply of special things to be had. [Robert Frank, New York Times, Nov 18, 17] In the final vote, as always in politics, where they stand depends on where they sit.
The myth; the answer. Kimberly Clausing is an economist at Reed College who studies the impact of tax cuts on economic growth. KIMBERLY CLAUSING: A lot of what's holding back investment right now has nothing to do with a scarcity of after-tax profits. In fact, if you look at multinational firms, most of them have record-high after-tax profits compared to earlier years or earlier decades. Instead, what seems to be holding back investment is lack of good investment opportunities. [NPR, Nov 17, 17] On the other hand: Good economists know that the correct answer to any question in economics is: it depends. [Dani Rodrik, The Guardian, Nov 16, 17] Meanwhile, the battle will rage to justify tax breaks for the already wealthy who will be expected to continue financial support for the Congresscritters. We do, after all, long for the best government money can buy. And for the moment the administration topped by a serial fact inventor has the megaphone.
A revised U.S. Senate tax bill has ditched a change in the treatment of stock options after an outcry from technology startups. [Jim Puzzanghera, Los Angeles Times, Nov 15, 17] Like a mystery novel where clues have to be discovered about a conspiracy after a cabal of "political leaders" presented a take-it-or-leave-it tax bill. Open debate by elected representatives was thought too much a danger of reality infusion by the unwashed masses.
A proposed tax that charges people as their startup equity vests instead of when they cash it out and actually have money to pay the taxes could wreck how tech companies recruit talent. ... The proposed tax could prevent wide swaths of tech employees from accepting stock options and RSUs. [Josh Constine, techcrunch.com, Nov 14, 17] Republicans, desperate to pass tax cut for angry wealthy donors, twiddle with everyone else's programs, down to even the lowly citizens needing medical insurance help. It's delivery time for Republican politicians' promises. Meanwhile, unfortunately for them, their allegedly Republican POTUS cannot be predicted from hour-to-hour.
Facing the evidence. “Three 500-year floods in three years means either we’re free and clear for the next 1,500 years,or something has seriously changed.” said Judge Ed Emmett, the chief executive of Harris County [Texas] ... And [Houston conurbation] built on an upbeat, pro-business strategy of low taxes and little government, relies heavily on American taxpayers providing government tax credits, mortgage interest deductions, gas subsidies, artificially low flood insurance rates, highway construction money — and emergency relief, including buying out homeowners to remove their properties from harm’s way. [Michael Kimmerman, New York Times, Nov 11, 17]
Senate rolls out its secret magic tax plan. It's a Republican self-inflicted wound in an effort to reward large political donors [and a real estate mogul POTUS] with some lower taxes basically by claiming large economc rewards and borrowing enough to fill the gap in revenue without taking much away from present voting constituencies for various government programs. First, they promised that everyone would be a winner, and then the details of harming present voters forces even more imaginary economics claims. Stand by for window-dressing change. The big donors seem to ignore the reality that politicians have to get elected by real people who want things from government [like SBIR] but cannot afford to pay for them all. The politicians basic mistake is pretending that fixing taxes will change much; the best tax program is one that balances demands among constituents and is left alone so investors can make rational decisions on long term investment.
Steven Walker, formerly deputy director and acting director at DARPA has been appointed to lead DARPA full-time. He succeeds Arati Prabhakar, who left DARPA in January and now serves as a fellow at Stanford University’s Center for Advanced Study in the Behavioral Sciences, the agency said. [Scott Nicholas, executivegov.com, Nov 8, 17]
Small biz myth. A key moment in the modern myth-making around small business came in 1978. That’s when MIT economist David Birch published claims – which he repeated in testimony before Congress – that small firms had accounted for 80 per cent of all new employment opportunities between 1968 and 1976. Critics quickly pointed out that Birch’s findings were quite wrong, largely because he defined firm size according to how many employees worked in a given location (like a branch office, factory, or store), not how many the firm employed altogether. In fact, most job creation, in the 1970s and today, comes from a small number of very fast-growing firms, while most small firms either fail (killing jobs) or remain small. Birch later admitted that the 80 per cent figure was a ‘silly number’, but the claims took firm root in popular mythology and political rhetoric by the 1980s. [Benjamim Waterhouse, Aeon, Nov 8, 17] SBIR was invented in 1982 on a fair-share argument that the federal government should have the same percenage of small prime contractors as does industry. The political myth has survived the reality that SBIR cannot justify its existence on any economic return or growth criterion. So, like most government programs it runs on inertia and political fear of change.
Major proposed budget cuts to the Homeland Security Department’s tech research division could leave the nation more vulnerable to emerging cyber threats, a former leader of the division said. President Donald Trump’s 2018 budget proposal cuts research and development funding for Homeland Security’s Science and Technology Directorate by 27 percent and cuts the overall division by about 20 percent. [Mark J.Terrill/AP, Nov 7, 17]
A tax credit that allows biopharma companies to recoup some of the cost of developing drugs for rare diseases could be abolished if a Republican tax reform bill goes through. As it stands, companies can claim a tax credit of 50% of the costs for clinical testing required by the FDA for drugs that treat rare diseases, a policy that has been in place ever since the 1980s when the Orphan Drug Act was enacted to encourage research into new treatments for diseases affecting fewer than 200,000 people. [Phil Taylor, Fierce Biotech, Nov 3, 17] The tax bill is a facade for easing taxes on the wealthy at the expense of any opposing political constituencies like large Demo-voting states. And with the economy stimulating gift of $1.5 trillion in new government debt. With, of course, economics fig-leaf fantasies of great economic growth promises.
Money talks, still. The heirs of wealthy people and business owners in low-tax states are among those most likely to benefit from the tax overhaul proposed by Republicans in the House of Representatives. [Wall Street Journal, Nov 3, 17] The rest of us will absorb a $1.5 trillion increase in the national debt over the next decade. The biggest winner will be the so-called populist President elected by downtrodden under-employed white nationalists who will get nothing from it.
President Trump will nominate Michael Griffin, former NASA administrator, as principal deputy defense undersecretary for acquisition, technology and logistics, Reuters reported. [GovConWire, Oct 24, 17] Mike was for a time my boss's boss at Star Wars and he let us run SBIR as we saw fit.
Already got the best. the reality is that we have the best tax code money can buy. Billions of dollars have been spent on lobbyists and by lobbyists to fashion the tax code to meet the special interests of special interest groups. It’s hard to imagine that Trump will be signing a tax reform package that will significantly reduce the complexity of the tax code. [economist Ed Yardeni, Oct 27, 17] their latest installment of trickle down fairy dust [economist Jared Bernstein] Stand by for a hurricane of economic puffery on the upside of tax cuts to anyone except the direct beneficiaries.
Credit and blame. as the most senior military leader in the U.S. chain of command, should responsibility fall to the president no matter what? Experts argue that the answer is unequivocally yes. .... But [Trump] told reporters that he wasn’t the one to specifically order the Oct. 4 mission in Niger that killed four U.S. soldiers [Willa Frei, HuffPost, Oct 26, 17] The military has a simple rule: The commander is responsible for everything the unit does or fails to do. Of course military operations are dangerous and some people will get killed and wounded because the enemy has a role in every plan. Trump could study Eisenhower as commander. There is also a fairness idea that if you deny responsibility for what goes wrong, you cannot accept credit for what goes right.
There is a huge gap between what Americans want from government and what (so far) they've been willing to pay in taxes — the gap being persistent annual deficits. ... the typical response of politicians both left and right [is that] They take refuge in familiar proposals that please their supporters but evade the new economic and social realities we face. [Robert Samuelson, Washington Post, Oct 23, 17] We are about to enter the 2018 chapter of fantasy economics that makes the deficits disappear eventually (when all present office holders have retired with a nice pension). Meanwhile, the demand for money to pay for pension and health benefits is increasing rising for the next two decades while the money needed is increasingly drifting into the wealthiest wallets which politically demand to pay less and less tax.
“The G.A.O. study is conservative, it’s not alarmist, it’s realistic and balanced and they go out of their way to point out all of the uncertainties involved,” [Robert N. Stavins, an economist at Harvard University] said. “I don’t see any likelihood it’s going to be taken seriously.” [LISA FRIEDMAN, New York Times, Oct. 23, 17] GAO's accountant/auditors rely on evidence, unlike many of the participants in the climate wars.
The US Senate voted narrowly to hand the rich $1.5 trillion in tax reductions for a decade. Several economists may well have been injured falling down laughing at the math. But then, Congress is no place for economists and mathematicians.
Farm-tech company SomaDetect (Canada) that helps farmers detect and then treat illnesses in cows won the [$1M] grand prize in [New York] 43North competition. ... CEO Bethany Deshpande said the company expects to create 25 jobs this year. [Buffalo Business News, Oct 6, 17] patented technology uses light scattering to assess every major compound of interest from raw milk in real time [company website]
The U.S. House this week passed H.R. 2763, which would amend the SBIR and STTR ... would extend or implement activities within SBIR/STTR, nearly all of which would improve the programs’ ability to support commercialization in parallel with technological development. .... would create a new initiative that effectively allows a small business to receive a third Phase II award that can be used for R&D only, so long as the company has developed a new commercialization plan and is backed by external funders ... would make permanent this pilot program, which allows all non-defense agencies to use up to 10 percent of their SBIR/STTR funds to essentially supplement Phase II or III awards, and awards made under this program can be up to three times larger than a standard Phase II award. [SSTI, Oct 11, 17] What's the folly in all this law? The agencies have no incentive to pick good market prospects in whom to invest for government and market use. The soothing sounding commercialization programs are an after-thought for the agencies, not a competitive criterion.
I have never heard someone say, ‘I would have started a company, but tax rates were too high’ or ‘I wouldn’t have started this company, but then George W. Bush cut tax rates, so I did.'— Silicon Valley entrepreneur Marcus Ryu. [quoted by technologyreview.com] Never mind, the taxcutters have no bounds on their imagination of economic miracles to follow cutting taxes on the top wealth.
Defense Secretary Jim Mattis said the U.S. is using diplomacy and economic pressure to turn back North Korea’s nuclear weapons program, but cautioned a gathering of Army officers and troops that they need to be ready in case negotiations fail. [Wall Street Journal, Oct 9, 17] This Army always has its bags packed, ready to go. How long it can keep recruiting worthy volunters for permanent war remains to be seen. The US ability to move a large force anywhere in the world with the right equipment remains a temptation to do so. And now we have a POTUS with no obvious strategic sense of appropriate deployment and mission.
My debt good, yours bad. The problem confronting those who want the government to reduce annual deficits is that the short-term consequences of profligacy have proved to be very modest, while the political benefits are substantial. “It doesn’t take a political scientist to understand that taking stuff away is a lot less popular than giving stuff out,” Mr. Goldwein said. [Binyamin Appelbaum, New York Times, Oct 4, 17]
moving forward, the [Army] will establish a new way to quickly procure new technology, breaking free of the normal acquisition process that is so slow, by the time technology makes it into warfighters' hands in the field, it's considered old." [DefOne, Sep 29, 17] details to follow, sometime
The power and influence of governments is decreasing because of the tremendous power of social networks and economic trends. There’s some problem in the pension funds in Spain, and the whole world feels it. I think these kinds of trends affect us much more than the decisions made in Washington and other capitals. [Ray Kurzweil, technologist now at Google, Fortune, Sep 28, 17] US Government is moving inexorably into re-distribution of wealth, not its creation.
When people are angry and looking for someone to blame, they don’t want to hear your 10-point plan to create jobs and raise wages. They want you to be angry, too. [Hillary Clinton, What Happened, Sep 2017] Clinton’s failure owed less to the merits (or demerits) of her particular policies than to her campaign’s lack of focus on the depth of the economic difficulties so many Americans face [E. J. Dionne Jr., Norman J. Ornstein and Thomas E. Mann, ONE NATION AFTER TRUMP A Guide for the Perplexed, the Disillusioned, the Desperate, and the Not-Yet Deported, Sep 2017] The armchair pundits of Twitter and Facebook will, of course, have their pithy and shallow rantings.
Another Startup Dream Machine. Four Senators introduced the Startup Act – legislation that would help regions throughout the country address critical gaps between R&D and economic prosperity. ..... [Senators Roy Blunt] saying “The Startup Act will make it easier for entrepreneurs to start and grow their businesses, resulting in more good-paying American jobs. ... The size of the program would be relative to the federal extramural R&D budget, which is difficult to quantify in advance, but would essentially be about 4 percent the size of SBIR funding, which was $2.3 billion in FY 2015. .... To learn more about the bill and to find out how you can encourage your delegation to support the Startup Act, contact SSTI today at 614-901-1690 or email@example.com. [SSTI, Sep 17, 17] Innovation makes a wonderful political talk subject; everyone is for it and no one closely defines it. But government handouts have a poor record of actually spurring innovation. All politically inspired innovation ideas ignore the ugly reality that new market competition creates losers and job losses.
Supply-side redux. Treasury Secretary Steven Mnuchin said a sweeping GOP tax overhaul would generate more than enough economic growth to offset the cost, pressing the administration’s argument that the plan would pay for itself. ... The plan offers no concrete details about how officials expect the tax plan will produce higher growth rates. And key pieces of it remain unwritten., [Kate Davidson, Wall Street Journal, Sep 28, 17] Meanwhile, Treasury Department has taken down a 2012 economic analysis that contradicts Secretary Steven Mnuchin’s argument that workers would benefit the most from a corporate income tax cut. The 2012 paper from the Office of Tax Analysis found that workers pay 18% of the corporate tax while owners of capital pay 82%. [Richard Rubin, Wall Street Journal, Sep 28, 17] Economics has not changed since 2012, nor have the outlandish political promises.
Oh, horrors: debt and deficit. Throughout Barack Obama’s eight years as president, Republicans hammered relentlessly at the horrors of debt. In 2011 they took the country to the brink of default because they didn’t want to raise the statutory debt ceiling. Last year candidate Donald Trump repeatedly ripped Mr. Obama for doubling federal debt. Yet in their drive to overhaul taxes, President Trump and his congressional allies are about to make the trajectory of debt even worse. .... Not to worry, though Lower tax rates will unleash so much new economic activity and thus added tax revenue that, contrary to history and mainstream economic opinion, the debt actually won’t rise much, if at all. .... There is little evidence from the last few decades that a tax rate cut raised underlying growth in the U.S. or any other advanced economy anywhere near that amount, once the vicissitudes of the business cycle are factored out. [Greg Ip, Wall Street Journal, Sep 28, 17] Why trot it out again? The Pres wants his taxes cut as do the high rolling donors who are not getting the dead Obamacare they paid dearly for.
Anti-drone ideas sought. [DARPA] asked industry to provide information on novel technology platforms designed to counter small unmanned aerial systems. A request for information posted Wednesday on FedBizOpps says DARPA is interested in modular and scalable platforms that work to identify and target small drones and could complement systems that are still in the development phase under the agency’s Mobile Force Protection program .... seeks novel tech platforms in the areas of sensing and neutralization that work to detect and destroy small UAS at a distance of at least 1 kilometer and can be integrated with tactical ground vehicles. [http://blog.executivebiz.com, Sep 25, 17]
The House science and small business committees jointly advanced an SBIR/STTR bill [H.R.2763 - Small Business Innovation Research and Small Business Technology Transfer Improvements Act of 2017] that would extend the “admin pilot” program to support applicant outreach and Phase 0 programs, bolster reporting requirements and create a new commercialization grants program [with follow-on Phase II matched by third party commercialization investment]. To date, the Senate has not introduced SBIR legislation this session. [SSTI, Sep 20, 17]
Leap in the dark. Having lost the debate for modification of Obamacare, the desperate Republican thin majority wants to leap into a dark place of a program that has had no serious thought and debate - a turnover of health care to the states who have no organization in place to accept it. The one sine qua non - cut taxes for the wealthy, healthcare mayhem aceptable.
Trade deficit dollars re-cycled. Wisconsin Gov. Scott Walker signed a bill Monday that would give Taiwan’s Foxconn Technology Group $3 billion in economic incentives to open a mega-plant in the state. Foxconn plans to invest $10 billion to build a 20 million square-foot campus in southeastern Wisconsin that could employ up to 13,000 workers over a period of six years. The facility would build liquid-crystal display technology, or LCD screens. [Shayndi Raice, Wall Street Journal, Sep 18, 17]
DARPA released broad agency announcements to seek research proposals for six new programs under the Electronics Resurgence Initiative. ERI is a program that will allocate $75 million in fiscal 2018 funds to support research efforts across the six new programs in the areas of system architectures, materials and integration and circuit design over the next four years, DARPA said Wednesday. [GovConWire, Sep 18, 17]
The U.S. political system isn’t broken. It’s working exactly the way the two main parties designed it. That’s the conclusion of a new Harvard Business School study. Authors Katherine Gehl, former president and CEO of Gehl Foods, and Michael Porter, a professor at the school, apply business theory to the U.S. political system and find an industry that works for Democratic and Republican organizations, big donors, pollsters, consultants, partisan think tanks, the media and lobbyists, but ignores most American citizens. [Jeffrey Sparshott, Wall Street Journal, Sep 14, 17]
Wonderland wish of the day: OMB Director Mulvaney about tax reform, economic growth and deficits: “In order to get the size — the magnitude of the reductions that we want in the corporate and the individual rates and in order to get the sweeping reforms that we so desperately need — you absolutely will see an increase in the deficit in the short term. But the payoff in the long term is actually that promise of balanced budgets.” [Yuval Rosenberg and Michael Rainey, Fiscal Times, Sep 12, 17] Borrow today, balance tomorrow: the promise of every conservative politician for at least thirty years.
Six months later, Congress has not only rejected the president’s N.I.H. [22% budget cut] proposal; lawmakers from both parties have joined forces to increase spending on biomedical research — and have bragged about it. [Robert Pear, New York Times, Sep 11, 17] Trump still has the option of vetoing the appropriation bill, but neither he nor his HHS hatchetman has offered any rational basis for their choice of research level. He could say that there is no such thing as an optimum research funding level; buy more, get more. The research system generates growing demand by graduating more and more PhDs with perfectly good proposals for research employment.
Humor the poor dear. multiple psychologists offered [Japan Prime Minister] Abe advice for handling Trump: “no matter what Trump says, one should always express approval before any signs of disagreement,” and “never refer to a topic that is unknown to Trump.” .... the preparations seemed to pay off: the personal rapport continued, and Trump apparently made no further complaints about the trade deficit, currency manipulation, or the cost of maintaining U.S. forces in Japan. [Takado Hikotani, Foreign Affairs, S/O71]
Launch New York, Inc. (Launch NY) is a 501(c)(3) venture development organization whose mission is to identify, support and invest in high-growth, high-impact companies and catalyze the entrepreneurial culture to drive job and wealth creation in the 27 westernmost counties of Upstate New York. ... designed to provide $25,000 to $100,000 in investment capital to companies. [http://www.launchny.org/]
Ditching the corporate memory. Buyouts offered by the Trump administration to more than 1,200 Environmental Protection Agency (EPA) employees have prompted 400 people to leave their posts since the end of last month, The Wall Street Journal reports. This mass exit has resulted in a 2.5 percent cut in the agency’s staff, the report states, and if workers continue to take the buyouts, the EPA could be facing its smallest operating staff since the late 1980s. The majority of the deals presented to employees consisted of buyouts or voluntary early retirement for eligible employees, according to an E&E News report from earlier this summer [Aggie Mika, TheScientist, Sep 6, 17] Even the phrase "climate change" is being forcibly retired in a wholesale denial of even the possibility that the latest record-intensity huricanes are a "climate change." The ditched employees remember what has been done and the state of the art in government handling of the enivornment.
Good, bad, necessary government. we have been wary of too much government activism. This is true not just in tackling climate change but in other areas that have contributed to the storms’ destructive power. Houston chose not to have any kind of zoning that limited development, even in flood-prone areas, paving over thousands of acres of wetlands that used to absorb rainwater and curb flooding. And now, of course, low-tax and low-regulation Texas has come to the federal government, hat in hand, asking for more than $150 billion to rebuild its devastated state. [Fareed Zakaria, WashPo, Sep 8, 17] And the Republican approach is that lowering taxes on the rich will shrink government and empower Texas, among others, to cater to profit-making. And then ask the rest of the nation to bail them out of their neglect.
Redux city-state? Power in the 21st century belongs to the problem-solvers. National governments debate and mostly dither. Cities act, cities do. Power increasingly comes from the cities up, not handed down from the nation-state.’ .... the nation-state with its borders, centralised governments, common people and sovereign authority is increasingly out of step with the world. And as Karl Marx observed, if you change the dominant mode of production that underpins a society, the social and political structure will change too. [Jamie Bartlett, Aeon, Sep 1, 17]
Perhaps a coincidence, but since [Former TX Gov] Perry took the reins at DOE, its SBIR/STTR program has been glacially slow.DOE has now postponed its LOI [for SBIR/STTR] due date indefinitely. [Greenwood Consulting, Aug 30, 17] It's all part and parcel of Trump's brainwave of shrinking the federal government, which will not happen unless Congress makes it happen. Unlike Trump, Congress listens to everybody.
A 2014 study by the Congressional Research Service put it this way: ‘A review of statistical evidence suggests that both labor supply and savings and investment are relatively insensitive to tax rates.’” [Robert Samuelson, The Fiscal Times, Aug 28, 17] Which dispels the Republican myth that tax cuts for the rich will generate growth and investment. But the rich are still willing to "invest" in lobbying for tax cuts anyway since the growth was just an apparently credible rationalization for the gullible.
Iowa subsidy. The Iowa Economic Development Authority (IEDA) has developed a program to help fight the loss of skilled tech professionals who are leaving the state to find employment elsewhere. Their program provides grant funding through student internship programs that match intern wages paid by a company dollar for dollar. The program targets industries such as bioscience, advanced manufacturing, and information technology, and is beneficial to startups that can’t compete with the pay of other well-established companies. Complete statistics for the year 2016 show that IEDA awarded 98 companies with grants, totaling 241 internships. 33% of eligible interns for hire were offered full-time positions and 23% of those offers were accepted. [Christine McGuigan, Silicon Prairie News, Aug 23, 17] Free market ideologies are not the only Midwest ideas.
Stopping change. The National Institute of Environmental Health Sciences (NIEHS) made several changes to its website in the past few months, some of which altered mentions of “climate change” to read simply “climate,” according to the Environmental Data & Governance Initiative Website Monitoring Report released last week (August 20). [Bob Grant, the-scientist.com, Aug 23, 17] Disproving Mark Twain's remark that everyone talks about weather but no one does anything about it. Trump commands climate change to disappear.
The federal government now spends a significantly lower percentage of GDP on research than it did in the 1960s and 1970s and has particularly stinted research in essential fields such as the physical sciences, mathematics and computer science, and the environmental sciences. [L Rafael Reif (MIT president), Foreign Affairs, M/J2017]
Q and A remain
In announcing his [war]
Trump became the third consecutive American president to be confounded
by the conflict in Afghanistan, now the longest military operation in
the history of the United States. ... “It didn’t work then,” said John
Dempsey, a former senior State Department official who worked on
Afghanistan and Pakistan. “And it especially won’t work now.”
.... The president heaped contempt on his predecessor’s strategy,
promising that he would avoid President Barack Obama’s mistakes. But in
substance, Mr. Trump’s strategy was not all that different from Mr.
Obama’s, relying on a mix of conventional military force and diplomatic
pressure on Pakistan. [JULIE HIRSCHFELD DAVIS
LANDLER, New York Times, AUG. 21, 2017] In the cold light of
Oval Office, mere bluster won't sell where lives are at stake.
Forecasters in The Wall Street Journal’s monthly survey of economists see on average a 22% chance of the government shutting down at the end of next month and a 17% chance that the U.S. Treasury will, at least temporarily, skip making payments on obligations such as government payroll or issuing Social Security checks to manage looming funding challenges. [Josh Zumbrun, Wall Street Journal, Aug 10, 17] SBIR awardees may see a stoppage in payment processing as OMB/Treasury allocates available cash to high priority activities.
What Team Trump needs to do to get the [NAFTA] trade position right is not that hard to understand. Strengthening the U.S. industrial base is the right objective. But you do this with policies that push industry and the work force up the technology and skill ladders exactly as the Japanese have, especially since the 1980s. The Japanese survived the swift rise of the Koreans, Singaporeans, and now the Chinese. That’s no mean accomplishment given Japan’s cost structure. How’d they do it? Automation and training with full-tilt policies behind them, simple as that. [Patrick Smith, thefiscaltimes.com, August 18, 2017]
Trump portrays [trade] it as a zero-sum game, an understandable perspective for a casino owner and businessman: gambling is the quintessential zero-sum game. But it is dead wrong as a way to think about the role of trade in an economy. Trade is actually a two-way street—the exchange of exports for imports—that makes efficient use of a country’s resources to increase its material welfare. The United States sells to other countries the goods and services that it produces relatively efficiently (from aircraft to soybeans to legal advice) and buys those goods and services that other countries produce relatively efficiently (from T-shirts to bananas to electronics assembly). In the aggregate, both sides benefit. [Douglas Irwin, Foreign Affairs, J/A 2016] When a political candidate talks about trade, ignore it. It is only what the candidate thinks the audience wants to hear. Truth is not a criterion.
More myopic political science. Trump Releases Science Spending Priorities for FY2019. In a memo to federal agencies, the administration highlights defense and security, leaves off Earth and climate science, and limits the scope of basic research. ... specifically calls out basic research as “critical,” but states that projects of “greater uncertainty” should give way to those that can be more readily developed into products and services. [Aggie Mika,the-scientist.com, Aug 18, 17] Since Trump and his budget chief know little about science and have no OSTP staff to rely on, Congress will drive the result. But scientists can help with publicizing the good science does.
CEO Abandonment. Companies get in bed with politicians when it serves their interests and are quick to run away when it doesn’t. ... Mr. Trump’s administration is turning out not to be the administration [many CEOs] were hoping for ... Especially he has not made headway on corporate taxes—the issue that bought him whatever benefit of the doubt America’s CEO class was willing to give him. Now a handful are fleeing his advisory council because he didn’t say the right words over Charlottesville [Holman Jenkins, Wall Street Journal, Aug 16, 17]
The Defense Innovation Unit Experimental, a 2-year-old effort that’s investing in private companies, face questions from Republican leaders in Congress and others who view it as a still-unproven and possibly unnecessary venture. .... Wrong, say the program managers, The proof that DIUx is working is the significant number of projects it has undertaken in a relatively short amount of time and with minimal taxpayer investment, said Col. Michael McGinley, who heads DIUx’s office in Cambridge, near the Massachusetts Institute of Technology. [PHILIP MARCELO, Associated Press, Aug 13, 17] Anyway, the money is small and may find a workable niche between DARPA and SBIR for new tech. And two years is way too soon for a federal program to make definitive judgments about quality of innovation. Meanwhile, the DIUx and and Strategic Capabilities Office have received authorization to accelerate their recruitment and contracting processes, Defense News reported. [Ramona Adams, executive.gov, Aug 11, 17] Note that DOD has always had the authority and the flexible money to jump on a big opportunity.
DIUx. The Pentagon's Silicon Valley outreach organization is rolling out one of the tools it's helped to develop, a suite of communications tools designed to help drone pilots coordinate to attack "pop up targets" of opportunity, like vehicles on the run. The tools, developed by the Defense Innovation Unit Experimental, will get a demonstration at the Al Udeid Air Base in Qatar, giving the fledgling organization a chance to prove its worth to the anti-Islamic State war. [Foreign Policy sitrep, Aug 10, 17]
I'm all for progress as you know,/long as we keep the status quo [song from musical "Oh, Captain". And in Russian Siberia a case that highlights the tensions between Mr. Putin’s aspirations for a dynamic private sector and his determination to enhance the powers of Russia’s security apparatus. ... [Scientist-entrepreneur] Mr. Trubitsyn, 36, whose company, Tion, manufactures high-tech air-purification systems for homes and hospitals, is accused of risking the lives of hospital patients, and trying to lift profits, by upgrading the purifiers so they would consume less electricity. [Andrew Higgins, New York Times. Aug 9, 17]
Here is the [budget/tax] debate’s larger significance: We can no longer grow our way out of serious conflicts, if we ever could. There isn’t enough money to satisfy all our demands, even at higher rates of economic growth. There will be conflicts between private and governmental spending; between national and local spending; between health and non-health spending; and between spending on the old versus spending on the young. The present is contentious; the future may be worse. [Robert Samuelson, WashPo, Aug 6, 17]
a THAAD interceptor hit a mock intermediate-range ballistic missile in a Pacific test, according to the Missile Defense Agency: "A THAAD weapon system located...in Kodiak, Alaska, detected, tracked and intercepted the target. Preliminary indications are that planned flight test objectives were achieved and the threat-representative, intermediate-range ballistic missile (IRBM) target was successfully intercepted by the THAAD weapon system." That makes THAAD 14 for 14 in intercept tests, according to MDA. [Marcus Weisgerber, Defense One, Jul 13, 17]
The U.S. House and Senate Armed Services Committees recently passed legislation [that] includes provisions for federal labs, SBIR and SBA technical assistance programs. These portions of the bills are currently very different between the chambers, The Senate NDAA has three provisions particularly of interest for small business and innovation advocates: Pilot Program for Streamlined Technology Transition from the SBIR and STTR Programs enabling the department to sign multiple award contracts with businesses that have completed a Phase I with Defense and gives the secretary the option of waiving competition requirements for these contracts; Pilot Program on Strengthening Manufacturing in Defense Industrial Base boosting production of emerging technologies through small- and mid-sized manufacturers by conducting activities that may include contracts or grants for assistance, purchase orders or commitments, direct loans or guarantees for businesses and awards to third parties to work with the manufacturers; and, Codification and Enhancement of Authorities to Provide Funds for Defense Laboratories — would create a mechanism for lab directors to spend 2-4 percent of funds on projects that may include technology transition, as well as research, lab infrastructure and workforce. The House NDAA, which does not include any of the Senate provisions highlighted above, devotes substantial attention to U.S. Small Business Administration programs, including provisions: Use of Authorized Entrepreneurial Development Programs [SBA] to deliver entrepreneurial development services and education, cluster development and maintenance or business training; Data Collection — the SBA administrator is directed to establish a working group to improve data collection on program impacts; [Jason Rittenberg, SSTI, Jul 13, 17]
Ban the talent. The otherwise little noticed Homeland Security action on the International Entrepreneurship Rule infuriated the high-tech industry. Bobby Franklin, the president and C.E.O. of the National Venture Capital Association declared in a statement: At a time when countries around the world are doing all they can to attract and retain talented individuals to come to their shores to build and grow innovative companies, the Trump Administration is signaling its intent to do the exact opposite. [Thomas B. Edsall , New York Times, Jul 17, 17] The cognoscenti have only themselves to blame for opening the door to an avid-nationalist opportunist by ignoring the social cost of a growing concentration of wealth with lower taxes as the only political goal.
Newest religion. Economics offers a comprehensive doctrine with a moral code promising adherents salvation in this world; an ideology so compelling that the faithful remake whole societies to conform to its demands. It has its gnostics, mystics and magicians who conjure money out of thin air, using spells such as “derivative” or “structured investment vehicle”. And, like the old religions it has displaced, it has its prophets, reformists, moralists and above all, its high priests who uphold orthodoxy in the face of heresy.. .... Yet if history teaches anything, it’s that whenever economists feel certain that they have found the holy grail of endless peace and prosperity, the end of the present regime is nigh. ... For, just as you can find a quotation in the Bible that will justify almost any behaviour, you can find human data to support almost any statement you want to make about the way the world works. [The Guardian (UK), Jul 15, 17]
Who you know matters. Startup That Got a Seat at White House Roundtable Is Part-Owned by Kushner Family. Venture-capital firm run by Kushner’s brother partly owns OpenGov, whose CEO last month attended summit with Donald Trump, leaders of Apple, Amazon, Microsoft [Wall Street Journal, Jul 14, 17] POTUS more family mogul than POTUS.
head of [SBA] praised [Amazon]— which has made a big business out of letting independent merchants sell on its website — as being an enabler of entrepreneurship.[despite] during the presidential campaign, Trump said Amazon had a “huge antitrust problem.” [Ángel González, Seattle Times, Jul 19, 17] All previous statements go down Orewll's history hole.
Ag science turns right. Trump has selected Sam Clovis, a former economics professor and advisor to Trump’s campaign as undersecretary for research, education, and economics ... Unlike previous undersecretaries, Clovis does not have expertise in science or medical research ... As ProPublica reported in May, “Clovis is better known for hosting a conservative talk radio show in his native Iowa ... act as USDA’s chief scientist, does not buy the data on climate change. Clovis told Iowa Public Radio in 2014 that, as far as climate change is concerned, “a lot of the science is junk science [Kerry Grens , The Scientist, Jul 20, 17]
One way loyalty. In an extraordinary denouncement of one of his earliest backers in Washington, Trump said [USAG] Sessions' decision to recuse himself from all matters related to Russia was "very unfair to the president." [AP, Jul 19, 17] Presumptivve job of vetting?
Trump refuses service from capable people willing to die for his counry. When I served my tours in the combt zone, I was glad to have anyone willing and able to stand with me.
Dismal economics resurrected. In his 2011 book The Globalization Paradox, [econmist Dani] Rodrik concluded that “we cannot simultaneously pursue democracy, national determination, and economic globalisation.” The results of the 2016 elections and referendums provide ample testimony of the justness of the thesis, with millions voting to push back, for better or for worse, against the campaigns and institutions that promised more globalisation. .... globalisation itself has changed, developing into a more chaotic and unequal system than many economists predicted. [Nikil Saval, The Guardian, Jul 14, 17] So, once again, today's problem was yesterday's solution, and circle of change continues to revolve. Home cooking won the election as Walmarts give way to the automation of online shopping which needs ever fewer human workers. Trump's mirage already being revealed as a Wizard of Oz.
The Pentagon is taking initial steps to more closely enforce so-called “Buy American” laws, elevating a series of Depression-era statutes that require manufacturers to rely on U.S. materials when they make guns, equipment, uniforms and food for the nation’s military. [Crain's WashingtonDC, Jul 10, 17] New DOD SBIR contracts will find more restrictive clauses in their contracts about buying materiel. SBIR already forbids R&D work.
Blocking competition. The Trump administration took steps toward scrapping a regulation that would have helped more foreign-born entrepreneurs build startups in the U.S. without a traditional visa. The Department of Homeland Security filed a notice that it will delay the effective date of the International Entrepreneur Rule. [Douglas MacMillan, Wall Street Journal, Jul 10, 17] No longer the world model for open competition: "America first", and declining.
Policy Impenetrable. “Impenetrable” Cyber defense on hold. Only hours after President Trump Tweeted that he and Russian President Vladimir Putin “discussed forming an impenetrable Cyber Security unit,” POTUS informed Twitter that it was actually a terrible idea. "The fact that President Putin and I discussed a Cyber Security unit doesn't mean I think it can happen. It can't," Trump wrote. As so often happens, Trump’s change of heart came after a member of his cabinet went on national television to praise the president’s original plans. This time, it was Treasury Secretary Steven Mnuchin’s turn to get burned by the boss. [Foreign Policy sitrep, Jul 10, 17] How does Trump escape destruction in the face of nearly complete collapse of any logic or continuity in policy pronouncements? Groupthink. says The Economist [Jul 1, 17] special report on how and what the lower middle class whites expect from him, and what they will overlook.
new polling confirms their [Republican] health care bill is deeply unpopular with the American people [Brookings, Jul 7, 17] Stand by for another advance of government support for the lower classes at the expense of the upper class. Who else? Somebody has to pay for it, either the rich or the future. Republican doctrine of every man for himself, especially the ones that get economically comfortable by business success or inheritance, gets undercut by universal suffrage and instant comunication that empower the voting multitudes to level the playing field somewhat. After all, if SBIR companies get help when they cannot compete in the open marketplace, why not other middle class people?
Liars meet "tremendous". Trump said he had a "tremendous meeting" with Putin. [The Russian] Foreign Minister said Trump had accepted Putin's assurances that Russia didn't meddle in the U.S. election. He also met UKPM May and says they were working on a trade agreement that he described as a "very, very big deal, very powerful, great deal for both countries." [AP, Jul 7, 17] said that he and Prime Minister Theresa May held “tremendous talks” on trade [New York Times] Then he faced off with world leaders over trade policy, positioning the U.S. as the most vocal critic of the international economic order and leaving it largely isolated. ... European Union leaders bluntly warned the president that they would retaliate against protectionist measures from Washington. [Emre Peker, Anton Troianovski and William Horobin, Wall Street Journal, Jul 7, 17]
Unwelcome to the USA. Robot allowed into US for competition, but no visa for Afghan girls who made it. .... Asked why the girls were banned, a US State Department spokesperson cited regulations prohibiting the agency from discussing individual visa cases .... So the six team members will watch the ball-sorting machine compete in Washington DC via video link during the 16-18 July event from their hometown of Herat, in western Afghanistan [The Guardian (UK), Jul 5, 17] Such xenophobia fits the gutting of the State Department which would be focusing on post-employment survival.
America first. Chinese and European diplomats have warned Donald Trump against reported plans to restrict imports of steel and aluminum – a strategy that risks triggering a global trade war. ... that “section 232” tariffs could not be justified on national security grounds .... At a Cabinet meeting, “One official estimated the sentiment in the room as 22 against and 3 in favor – but since one of the three is named Donald Trump, it was case closed,” Axios reported. [The Guardian (UK), Jul 1, 17]
Lawmakers in the two states edged closer to blowing through midnight deadlines without new budgets, setting the table for Maine’s first government shutdown in 26 years and painful cuts in Connecticut. [Wall Street Journal, Jun 30, 17] The struggle goes on in nation, state, and local between what people want from government and what they are willing to pay for it. Beneficiaries of government programs should be alert to shrinkage of the relatively generous handouts in our world's richest society. For the decades since WW II we have had great economic growth that could pay for government programs. Today, however, the economists say that such growth will not continue in the more competitive world we find outside America. And all the political palaver about magical formulae for high growth is just wishful thinking.
Start the FY18
House Appropriations Committee began
releasing FY 2018 “markup” budget bills this week, and the proposals
would cut billions in non-defense spending. ... SBA’s entrepreneurial
development programs would lose $34 million, NIST’s Manufacturing
Extension Partnership would lose $30 million, and Energy’s ARPA-E would
be eliminated, among other cuts. [SSTI, Jun 28,
History says that the Congressional oversight committees will prevent
such wholesale slaughter of long established programs in search of
cheaper government that the wealthy have to pay for.
Trumponomics is Mercantialism. The dominant economic perspective 16th to 19th centuries is a zero-sum world, like Trump's real estate world wherein any gain by some other country is a loss for the USA. But the 20th century proved that free trade could improve both parties, and if the goal is winning at another's expense, the mercantilist needs the 18th century British Navy's untrammeled power. [Kent Gardner, Rochester Business Journal, Jun 23, 17] So far, the under-qualified workers in the upper Midwest still think that at least he's our jerk, until perhaps he signs a law that prices health care out of their shrinking reach.
In their ardor to undermine and abolish the Affordable Care Act, Republicans in Congress are causing inestimable damage. Specifically, they are damaging the United States’ reputation for reliability among private companies looking to do business with the government. This is not a partisan statement. One of us is a Republican, the other a Democrat. We differ on many policies, including health care reform. But we agree that the circus atmosphere surrounding the Affordable Care Act — exemplified this week by the abrupt decision by the Senate majority leader, Mitch McConnell, to delay the vote on the Senate’s replacement bill — is generating uncertainty, which in turn is jeopardizing the future of public-private partnerships. [New York Times, Jun 28, 17]
NASA says its 2018 SBIR/STTR Solicitation will be released early next year instead of uhe usual November; not surprising given the low priority of SBIR and the near-chaos of the Trump administration's management.
A Government Agency That Produces Real Innovation. In a new Manhattan Institute report, we find that NIH does particularly well in this regard: Its patent portfolio produces 20.4% more market value than average patents, with every $100 million in NIH funding associated with $598 million in downstream private research and development. For some of NIH’s most productive programs, total downstream R&D is as high as $3.3 billion for every $100 million in grant funding. [Mike Kalutkiewicz, founder of Belle+Preuve Public Affairs LLC and Richard L. Ehman, professor at the Mayo Clinic., Wall Street Journal, Jun 22, 17]
Something for every Republican. The mystery health bill prescribes help for every Republican donor in proportion to their campaign contributions and lobbying expenses. Why not? Its a representative legislature in a capitalist democracy where the highest court rules that money is speech.
a Canadian gentleman asked me a simple question: “What do you fear most these days?” ... “I fear we’re seeing the end of ‘truth’ — that we simply can’t agree any more on basic facts. And I fear that we’re becoming Sunnis and Shiites — we call them ‘Democrats’ and ‘Republicans,’ but the sectarianism that has destroyed nation-states in the Middle East is now infecting us.” [Tom Friedman, New York Times, Jun 20, 17]
Fallen Angels. Despite hailed by medtech and biotech entrepreneurs as a vital piece of the puzzle in efforts to translate Minnesota’s leadership in medical research into startup businesses. ... The Minnesota High Tech Association asserts $377 million in business investment has been tied to the credits since their inception in 2010. .... an intense lobbying effort from “dozens of companies and organizations.” “the funding for the Angel Tax Credit was removed” [Don Jacobson, Twin Cities Business, Jun 7, 17] Politics of subsidies usually lacks credible accounting for what would have happened without the subsidy. Minnesota legislators may have called the bluff.
[$258 million in research contracts to six companies developing supercomputing technology] comes after a White House budget proposal advocated nixing research and development funding across agencies and especially at the Energy Department. .... proposed eliminating the Energy Department’s R&D unit, the Advanced Research Project Agency-Energy, or ARPA-E, because “the private sector is better positioned to finance disruptive energy technology research and development." [Mohana Ravindranath, nextgov.com, Jun 19, 17] Great trust in private investment in innovation that might undercut present technology investment. Ah well, whatever works to cut taxes (and the many present R&D jobs paying good wages).
every single one of America’s 493 wealthiest counties, almost all of them urban, voted for Hillary Clinton. The remaining 2623 counties, most of them suburban or small-town, went for Donald Trump [Edward Luce, The Retreat of Western Liberalism, Jun 2017] And the Republican Congress is doing its best to serve those rich counties while the richest-ever President dithers about what his mandate means and how to pursue it.
Scattered and incalculable. One might expect that over that amount of time, the Department of Defense would have developed a system to become compliant with SBIR’s fundamental provision that a minimum threshold of innovation research spending be directed toward small businesses. Yet, a new report from the Government Accountability Office concludes DOD couldn’t say if it was meeting the threshold because, DoD did not submit the required obligations data. The report states “DOD officials told [the GAO] that obtaining obligations data would require requesting information from more than 10 individual program offices that, in turn, would have to request the information from various DOD comptrollers, which would be a major effort.” [SSTI, Jun 7, 17] Each sub-agency of DOD has its own incentives to short-change SBIR in favor of spending its R&D money its its main purposes. But the politicians seem to care for nothing about SBIR except handing the mandated amounts to the small biz political constituents.
Economic dream. Trump has plans, and promise, to create a "first-class" system of roads, bridges and waterways by using $200 billion in public funds that he says will generate $1 trillion in investment to pay for construction projects that most public officials agree are badly needed and long overdue. [San Jose Mercury News, Jun 7, 17] Private invesors, though, don't do it for politics, only for profit, which is hard to come by from road and bridges. If it were a good investmnt, we would already have a lot of it. Even The Donald would have invested in it. Now we shall see how persuasive he is with private investors as he tweets his way to fame and fortune for public goods. Stand by for rip-off stories as private firms take public money controlled by politicians.
Retroactive cancellation. In January, the Department of Homeland Security announced 31 winners in a controversial grant program to fight violent extremism. A team lead by UNC-Chapel Hill researchers won the largest – nearly $900,000 to develop information campaigns to counter jihadist and white supremacist recruiting. ... and so far the Trump administration has refused to release the money. ... A spokesman for the Department of Homeland Security wrote in an emailed statement that it’s unclear whether the money will be released. He declined to say why the department hasn’t sent it. .... Congress, though, has already approved the grant program for the current fiscal year. [Jay Price, WUNC Radio, Jun 5, 17] Politics or incompetence? In the chaos of Trump's fumbling administration, almost any explanation could be true.
Pay some, stiff others. [OMB Director] Mulvaney said, “You cannot meet all of your obligations as a nation; that’s not a desirable outcome.” However, he added, there is “absolutely no way” the U.S. would default on Treasury securities. “We are not going to do that. You can take that off the table,” Mulvaney vowed. What’s likely to trouble the financial markets in that statement is the distinction Mulvaney makes between payment to debtors who hold Treasury securities and all other payments -- from Social Security checks to the federal payroll to bills from government contractors. [Rob Garver and Eric Pianin, Fiscal Times, Jun 5, 17] The message: Rich US bond holders will get paid but poor Social Security recipients will have to compete with all other government bills for underpayment or outright default. Our new president is reportedly quite adept at not paying the full bill for services and his OMB chief is ready to arbitrarily default on obligations enacted in law.
Back toward sane government. Kansas legislators repudiated the tax-cutting experiment that brought Gov. Sam Brownback national attention, with even fellow Republicans voting to override his veto of plan reversing many of the income tax reductions he's championed in recent years as a way to fix the cash-strapped state's budget. [JOHN HANNA, AP, Jun 6, 17]
A transformative event. Mr Trump has revolutionized our ideas of what the US stands for. We live in the world the US made. Now it is unmaking it. We cannot ignore the grim reality. ... Hard power and lower taxes: these are the US priorities under Mr Trump. [Martin Wolf, Financial Times, May 31, 17]
So in love with the sound of his own voice speaking power: Trump may have irretrievably undermined his lawyers’ efforts to persuade the Supreme Court to reinstate his executive order limiting travel from six predominantly Muslim countries. Saying he preferred the original travel ban, “not the watered down, politically correct version” he had issued in March, Trump attacked both the Justice Department and the federal courts. [Adam Liptak and Peter Baker, New York Times, Jun 6, 17]
ARPA-E intends to issue a Funding Opportunity Announcement (FOA) for the development of hybrid fuel cell and engine systems for the ultra-high efficiency conversion of natural gas to electricity. The objective of this FOA will be to encourage the development of commercial-scale (>100 kW) Distributed Generation (DG) systems that have fuel-to-electric power conversion efficiencies in excess of 70% on a Lower Heating Value (LHV) basis. [ARPA-E Newsletter: June 2, 2017]
Technology will leave few segments of the labor market untouched .... while machines with rudimentary artificial intelligence capabilities are already writing basic news stories .... The [worry] is that Americans will embrace a still more radical politics that threatens to compound the damage. Already, both parties are flirting with populist “quick fix” remedies. ... A bipartisan new deal would instead be premised on helping individuals to acquire the education and skills they need to prosper in a fast-changing economy. [Edward Alden and Robert Litan, Council for Foreign Relations, May 31, 17] People with short attention spans and declining education standards call for quick fixes to any problem.
Everyone's on their own. It was put most succinctly this week by two Trump advisers, H.R. McMaster and Gary Cohn, when they wrote in the Wall Street Journal that “the world is not a ‘global community’ but an arena where nations, non-governmental actors and businesses engage and compete for advantage...Rather than deny this elemental nature of international affairs, we embrace it.” [The Economist, Jun 3, 17] Trump apparently requires his "advisors" to promote his opinions without regard to the advisors' earned reputation for strategic thinking and respect for facts.
Weeks before Trump made the announcement on the Paris accord, it was clear the debate inside the White House on the issue was "content free" and purely political, Forign Policy's Robbie Gramer and Dan De Luce reported. And the [climate is a security problem] views of [SECDEF] Mattis and others in the national security establishment were not solicited. [Foreign Policy sitrep, Jun 2, 17]
The Department of Homeland Security announced that it would not be implementing a ban on laptops and other electronic devices on flights to the United States from Europe. Whether the U.S. government will pursue a rule like this in the future remains uncertain [Crain's Washington DC, Jun 1, 17]
Snake oil state. Lawmakers in Austin have approved a bill authorizing unapproved stem cell therapies, putting Texas on track to become the first state to explicitly recognize the experimental treatments. [Andrew Joseph, statenews.com, May 30, 17] You could be an experiment in over-promising ventures.
The Pentagon conducted a successful test of a system designed to shoot down an intercontinental ballistic missile : ICBM from southern Pacific, interceptor from California.
The DeSoto County [CA] Board of Supervisors approved 10-year partial property tax incentives for Intuitive Surgical on May 15. [Elle Perry, Memphis Business Journal, May 19, 17]
[John Boehner] said a repeal and replacement of the Affordable Care Act is "not going to happen. Republicans never ever agree on health care." Twenty four million people will not give up their health insurance for the sake of a few thousand billionaires [who don't need health insurance] paying less tax for social insurance in a tax cut bill pretending to be a healthcare plan.
Economics trumps Trump. More than 600 Carrier employees in Indianapolis will soon be out of a job. ... Last year, the company originally said it planned to move its entire operation to Mexico, laying off more than 1,000 Hoosiers. Last fall, President Trump struck a deal with Carrier to save many of those jobs. [Indianapolis Star, May 22, 17] As Trump knows and does at home, economics tops politics for profit-making corporations.Made America great. [billionaire biotech investor Gerald] Chan said investments in basic science are paying off for many Asian countries, which have been “unsparing” in pouring money into that sector. “Slowly but surely, they are chipping away at America’s commanding lead in science, which was part and parcel of the post-World War II world order,” Chan said. “If we are to make America great again, let us never forget what made America great in the first place,” he told the audience, [Bradley Fikes, San Diego Union Tribune, May 19, 17]
Trump's energy plan: more oil, less R&D. heavily influenced by the Heritage Foundation, a conservative think tank that argues that the federal government should fund only very basic scientific research and get out of the business of helping companies commercialize new energy technologies. ... Office of Energy Efficiency and Renewable Energy, which has helped nudge down the cost of solar power, faces a 69 percent cut. The Office of Fossil Energy, which invests in methods for capturing carbon dioxide from coal plants and burying it underground, faces a 54 percent cut. The Office of Nuclear Energy, which is pursuing technology to help extend the life of the United States’ existing nuclear reactors, faces a 31 percent cut. [BRAD PLUMER and CORAL DAVENPORT, New York Times, May 23, 17] Chances in Congress? Nil.
administration says it
can balance the federal budget within a decade. Its blueprint calls for
significant cuts to social safety net programs and assumes more robust
economic growth [with] what it calls a "Taxpayer First"
... the first time in a long time that an administration has written a
budget through the eyes of the people who are actually paying the
taxes,” said Trump’s budget director. [npr,
Look for the
entitlements clause that allows the rich to sleep under the
bridges. It's consistent with Trump's lifelong approach to
ask for more than everything. He did suggest in his campaign
even Treasury bond-holders could also be asked to take less than their
due. He will find that government doesn't work like a family private
entity, especially when the other party can fire him.
Trump's energy plan: more oil, less R&D. heavily influenced by the Heritage Foundation, a conservative think tank that argues that the federal government should fund only very basic scientific research and get out of the business of helping companies commercialize new energy technologies. ... Office of Energy Efficiency and Renewable Energy, which has helped nudge down the cost of solar power, faces a 69 percent cut. The Office of Fossil Energy, which invests in methods for capturing carbon dioxide from coal plants and burying it underground, faces a 54 percent cut. The Office of Nuclear Energy, which is pursuing technology to help extend the life of the United States’ existing nuclear reactors, faces a 31 percent cut. [BRAD PLUMER and CORAL DAVENPORT, New York Times, May 23, 17] Chances in Congress? Nil.
Usual fantasy coming. Trump will propose the U.S. can balance the federal budget over 10 years with substantial cuts to safety-net programs such as food stamps and other anti-poverty efforts, combined with a tax and regulatory overhaul that speeds up the nation’s economic growth rate, a senior White House budget official said. [ Nick Timiraos, Wall Street Journal, May 19, 17] Mere fantasy: tax cuts will not jump start growth without great deficits [spending more money does raise economic activity], and the people's representatives will not slaughter benefits programs for any economic classes.
Fact check. "Obamacare is collapsing. It's dead. It's gone," Trump said in a news conference. "There's nothing to compare it to because we don't have health care in this country," ... In fact, we do have health care in this country — quite a lot of it. The U.S. spent about $3.2 trillion on health care in 2015, or nearly $10,000 per person. It accounts for 17.8 percent of GDP. [Alison Kodjak, NPR, May 18, 117]
Attention getter. The president skims reports quickly, and according to Reuters, “National Security Council officials have strategically included Trump's name in ‘as many paragraphs as we can because he keeps reading if he's mentioned,’” according to one official. [Foreign Policy sitrep, May 18, 17]
Congress hates failure. Technology giants, not the government, are building the artificially intelligent future. And unless the government vastly increases how much it spends on research into such technologies, it is the corporations that will decide how to deploy them. [Farhad Manjoo, New York Times, May17, 17] USG R&D is quite conservative, wanting predictable success that continues Congress's willingness to keep the money rolling. SBIR could have been a gateway to tech change, but Congress simply let handing out money to small biz take priority over innovation. Since innovation needs a lot of failures.
New National Laboratory Collaborations ... the U.S. Department of Energy announced the 38 small businesses that will collaborate with national lab researchers through the third round of the Small Business Vouchers (SBV) pilot. SBV facilitates access to the DOE national labs for American small businesses, enabling them to tap into the intellectual and technical resources they need to overcome critical technology challenges for their advanced energy products and gain a global competitive advantage. Eight DOE national laboratories will receive funding to partner with 38 competitively selected small businesses across the country. Visit the Energy Department's website www.SBV.org to read the whole story.
America has the only healthcare system in the world designed to avoid sick people. Private for-profit health insurers do whatever they can to insure groups of healthy people because that’s where the profits are. They also make every effort to avoid sick people, because that’s where the costs are. [Robert Reich, robertreich.org, May 7, 17]
“Government bureaucrats can be very dangerous when they have power” to make decisions on people’s health, [Congressman] MacArthur said, prompting one woman to tell the congressman she would prefer that scenario than “someone in an office” of an insurance company making the same decisions. [Adam Gabbatt and Lauren Gambino, The Guardian (UK), May 11, 17] Republicans face older and sicker constituents in stormy townhalls. The party driven by tax cuts for the wealthy face the voters who survive with government help. The wealthy do not show up to defend their demand for government help with their tax bills.
Richard Milhous Trump fired his chief investigator, which ignited a firestorm over how the decision would impact the agency’s investigation into possible collusion between the Trump campaign and Russia. [Wall Street Journal, May 10, 17] Anyone who was an adult in the early 1970s would remember Nixon's travails with a chief investigator getting too close to the inconvenient truth. The President has fast power, but Congress has the slow ultimate power. An ugly and perilous power struggle could result between autocratic business and representative democracy in a politically polarized nation.
Make science fit the answers. The Environmental Protection Agency has dismissed at least five members of a major scientific review board, the latest signal of what critics call a campaign by the Trump administration to shrink the agency’s regulatory reach by reducing the role of academic research. A spokesman for the E.P.A. administrator, Scott Pruitt, said he would consider replacing the academic scientists with representatives from industries whose pollution the agency is supposed to regulate, as part of the wide net it plans to cast. [Coral Davenport, New York Times, May 7, 17]
It takes little courage to aid those who are already powerful, already comfortable, already influential, but it takes great courage to champion the vulnerable and the sick and the infirm. [Barrack Obama, May 7, 17]
More campaign inanities. President Trump declared that “everybody” on the world stage has better health care than the United States, but suggested that the GOP’s health care plan will change that. .... “But our healthcare will soon be great.” ..... it’s somewhat ironic that the countries [actually] outranking the U.S. in general reports on this topic, such as the Commonwealth Fund, tend to provide health care for their citizens regardless of their wealth or economic status — Canada and Norway, for instance. [Michael Walsh, Yahoo News, May 5, 17] Advertisers would be called out on such claims; politicians can be called out only at the next election. And this politician was actually rewarded for endless inanities in the last election. But Trump had told us his design: In “The Art of the Deal,” Trump said that playing to people’s fantasies and promising the greatest product was “an innocent form of exaggeration.” [Maureen Dowd, New York Times, May 6, 17]
US House passed tax-cut bill promoted as healthcare improvement. After all, Republicans were born to cut taxes. Trump approves of cutting health insurance from his loyal under-employed Rust Belt voters. Fortunately for him, they probably do not yet recognize their loss. Bottom-line message: you're on your own. The rich and healthy benefit, but poor and disabled people who use Medicaid could lose out. [MARGOT SANGER-KATZ, New York Times, May 5, 17] Meanwhile, Senate Republicans have been working for weeks writing their own version, [Wall Street Journal, May 4, 17] In the Senate, where gerrymandered districts for safe seats does not apply, centrist approaches have more appeal. Who's a big winner so far? The rich and smiling President who gets huge tax cuts and does not need health insurance.
Continue the march. Top Capitol Hill negotiators reached a hard-won agreement on a huge $1 trillion-plus spending bill that would fund the day-to-day operations of virtually every federal agency through September, aides said Sunday night. .... rejects White House budget director Mick Mulvaney's proposals to cut popular programs such as funding medical research and community development grants ... a $2 billion funding increase for the National Institutes of Health - rejecting the steep cuts proposed by Trump - as well as additional funding to combat opioid abuse a lowest-common-denominator measure that won't look too much different than the deal that could have been struck on President Barack Obama's watch last year. [Andrew Taylor, AP, Apr 30, 17] But will our ego-centric president accept its ignoring his hyperbolic campaign promises?
The economic circumstances are utterly different now [from Reagan supply-side tax-cut promises] and not well understood by the policy thinkers in either political party. The world is struggling right now—not with a shortage of capital or wealthy investors, but with a secular stagnation in which capital is overly abundant. And wealth holders and financial firms are unwilling to invest in new production and employment because they can see no market of willing and capable consumers. [William Greider, The Nation, Apr 28, 17]
Scientists of all stripes see the administration as a threat not just to funding—as the White House’s budget proposals have made clear—but to their world view. People marched in hundreds of cities last Saturday (Earth Day) to protest, and organizers spent this week reminding people that marching is not enough. [Alex Lash, xconomy.com, Apr 28, 17]
America's tax system is ... a self-defeating combination of fairly high tax rates and generous exemptions that mean little money is actually raised. ... so knotty that America has as many tax preparers per 1,000 people as Indonesia has doctors. It distorts behaviour: American firms have at least $1trn-worth of cash stashed abroad to avoid the taxman. [The Economist, Apr 28, 17] We reward our politicians for promising tax miracles of multitudinous jobs and lower taxes, while we do not punish them for lower public revenues that add to the public debt.
More oil. Trump signed an executive order to ease regulations on offshore drilling and eventually allow more to occur, particularly in the Arctic Ocean. [WSJ, Apr 29, 17] Drain America first while adding the the worldwide oil glut that keeps prices and profits depressed.Still campaigning.
A Beaverton [OR] man who has a bachelor of science degree in engineering and has repeatedly challenged Oregon's timing of yellow traffic lights as too short was investigated by a state board for "unlicensed practice of engineering'' and fined $500. [Maxine Bernstein, The Oregonian, Apr 25, 17]
Natus Medical down 10% [Apr 26, 17]
No, not that
federal judge [in California] blocked any attempt by the Trump
administration to withhold funding from "sanctuary cities" that do not
cooperate with U.S. immigration officials, saying the president has no
authority to attach new conditions to federal spending.
"Federal funding that bears no meaningful relationship to immigration
enforcement cannot be threatened merely because a jurisdiction chooses
an immigration enforcement strategy of which the president
disapproves," the judge said. [AP,
Apr 25, 17]
his own private business, OK; but US law admits no emperor. San
Francisco and Santa Clara County had sued as others are marching to
their federal court houses.
President Trump plans to unveil a tax cut blueprint that would apply a vastly reduced, 15 percent business tax rate not only to corporations but also to companies that now pay taxes through the personal income tax code — from mom-and-pop businesses to his own real estate empire, according to several people briefed on the proposal. .... His plan would put off the difficult part of a tax overhaul: closing loopholes and increasing other taxes to limit the impact of tax cuts on the budget deficit. [JULIE HIRSCHFELD DAVIS, ALAN RAPPEPORT, KATE KELLY and RACHEL ABRAMS, New York Times, Apr 26, 17] His gift to deserving companies, including his. Conflict of interest? Perish the thought; he's exempt. Shades of Engine Charley Wilson: what's good for America is good for GM.
Donald Trump has casually suggested that he’d like NASA to fly humans to Mars during his first term in office. Good luck with that. [technologyreview.com, Apr 25, 17]
Two trade groups and about a dozen technology companies signed a letter to the Trump administration late last week calling for the continuation of the U.S. Federal Trade Commission’s lawsuit against Qualcomm over patent licensing. [San DiegoUnion Tribune, Apr 24, 17]
Drain America First. The Trump administration is taking retaliatory action against Canada over a decades-old trade dispute, moving to impose a 20% tariff on softwood lumber that is typically used to build single-family homes, Commerce Secretary Wilbur Ross said Monday in an interview. [Peter Nicholas and Paul Vieira, Wall Street Journal, Apr 24, 17] Resource extractors, and real estate developers, cannot see past today's marginal production cost.
"You're fired" monomania President Trump this week will sign an executive order to create a new office in the Veterans Affairs Department to increase employee accountability and protect whistleblowers, according to a White House official. [Eric Katz, Government Executive, Apr 24, 17] After decades of underfunded VA treatment centers, the new broom wants more sweeping power for his favorite management approach from his TV acting career. Politics. No doubt the decider new broom will want to pay for better VA care by cutting taxes for his economic and business class.
Advancing rearward.The Trump administration has proposed cuts to science programs amounting to around $7bn, including cancer research, coastal resiliency work and climate research. This week, Jeff Sessions, the US attorney general, announced the dismantling of the National Commission on Forensic Science, a body that works to improve the accuracy of forensic evidence in criminal cases. [Oliver Milman, The Guardian, Apr 22, 17] Sessions this week belittled a Hawaiian federal judge as from a small island, after years of representing the rearward-facing state of Alabama which has twice removed its chief judge from office for misconduct.
Companies may encounter challenges as they weigh the pros and cons of producing their goods in the U.S. again. But small firms face particular hurdles: They can’t always attract top talent or find U.S. suppliers that meet their specifications. ... Bringing its manufacturing back to the U.S. cost GAM Enterprises (Mt Prospect, IL; no SBIR) nearly $4 million and required technical and financial assistance from Illinois and the U.S. Commerce Department’s Manufacturing Extension Partnership. The company hired a headhunter for the first time in its 26-year history, after struggling to find a machinist who could operate new small-batch production technology. Even then, the new hire required months of on-the-job training. [Ruth Simon and Vipal Monga, Wall Street Journal, Apr 14, 17] Politcians wish for magic results from glib policies but overlook the economic price to make it happen.
A small-business advocate has won a day in court with Pentagon attorneys to argue whether the Defense Department should release shielded internal documents that the plaintiff argues will reveal a government bias against small defense contractors. Lloyd Chapman, founder of the Petaluma, Calif.-based American Small Business League, for years has sought to expose the workings of the 28-year-old Comprehensive Subcontracting Plan Test Program designed to “determine if comprehensive subcontracting plans on a corporate, division or plant-wide basis [instead of for individual contracts] would lead to increased opportunities for small businesses.” [Charles Clark, DefenseOne, Apr 14, 17]
The Most Ambitious Government Overhaul Ever. When Donald Trump promised not touch Social Security and Medicare -- the two most expensive items on the federal budget -- but to go after waste, fraud, and abuse, it was obvious he would try to streamline the federal workforce to ensure that every job was necessary to meet the mission of each agency and program. [Eric Pianin, Fiscal Times, Apr 12, 17] Ronald Reagan rides again, but Trump will find, as Reagan did, that "waste, fraud, and abuse" is any program that benefits someone else. Congressional oversight committees will protect their constituents as always, and the overhaul will be overshadowed by the next several government crises.
Phase I answers the biggest question. To the extent public funds are used to subsidize applied private sector R&D, the findings in this paper suggest that more [SBIR] grants to small, young firms on a one-time basis may be more effective in stimulating innovation than fewer larger grants that follow firms through multiple stages of technology development. .... This paper conducts the first large-sample quasi-experimental evaluation of R&D subsidies ... An early-stage [SBIR] award approximately doubles the probability that a firm receives subsequent venture capital and has large positive impacts on patenting and revenue. [Sabrina T. Howell, American Economic Review, April 2017] A paper that could set Congress to re-thinking their idea that more small biz money means more innovation. If Congress had any time or energy to spare from political power gamesmanship.
Machine guns. Tanks. Chemical weapons. Warplanes. Submarines. Trench coats. Wristwatches. [Today] marks the 100th anniversary of the U.S. entry into World War I, and some of the innovations that were developed or came into wide use during the conflict are still with us today. [Chris Carola, AP, Apr 6, 17]
A few weeks ago, President Trump said his administration was running like “a fine-tuned machine.” This was true, I thought, assuming the machine was a Tandy 1000 computer. Unless the government is bombing or spying on people, it is technologically primitive. [Barry Ritholz, USA Today, Apr 5, 17]
Reality intrudes. As a candidate, Mr. Trump promised to take strong action on trade and label Beijing a currency manipulator on his first day in office, but he has since backed off those positions. [Carol Lee and Felicia Schwartz, Wall Street Journal, Apr 5, 17] The hopeful people elected a brash unpracticed politician with no obvious base for his claims and promises. Now the consequences.
Of course I'm right. The “spreading epidemic of misinformation,” nowadays known as “alternative facts,” gives rise to a corollary to Gresham’s Law (“bad money drives out good”): “Misinformation pushes aside knowledge.” Everyone with a smartphone has in his or her pocket, Nichols says, more information “than ever existed in the entire Library of Alexandria,” which can produce a self-deluding veneer of erudition. [George Will, WashPo, Apr 5, 17]
two different mountains. Trump did not create the conditions for his own rise. During the Obama era, conservative media, particularly talk radio, adopted what Vox’s David Roberts calls a “tribal epistemology.” All facts were filtered for the benefit of the tribe. In this approach, information is useful only as ammunition. And conflicting views are entirely the result of bad faith. This was a political wave well suited to an empty vessel. Trump was willing to say anything the medium demanded. ... On issues such as climate change or gun control, the reds and blues do not see different ways up the mountain. They see two different mountains — two different fact sets, two different political, social and scientific realities. [Michael Gerson, WashPo, Mar 23, 17]
Trump's education. Trump says The Common Core State Standards has “to end” because “we have to bring education local.” Catherine Engelbert, chief executive of Deloitte, asked him about his priorities “around education” and around “the work of the future.” She noted that the New York City public high school graduation rate is 70 percent, but the readiness of students for college and career is assessed at 37 percent. ... He didn’t directly address any of the issues she mentioned but went into a somewhat rambling explanation of his education priorities. [Valerie Strauss, WashPo, Apr 4, 17] Trump's standard would force business to know the education standards in every local school district when evaluating job applicants. National standards have large effect on efficiency and unity. Trump's education in government is just starting.
over the weekend U.S. Citizenship and Immigration Services released new guidance that computer programmers are no longer presumed to be eligible for H-1B visas [DCInnoBeat, Apr 3, 17]
Government is different. trying to apply private sector innovation to the public sector, with its overlapping and sometimes conflicting legislative mandates and a bureaucracy organized to execute on those mandates, is a gargantuan task. If Trump and Kushner want Washington to innovate internally, they’ll have to begin with experimental and small-scale efforts that large private companies have tried in the past [Joe Hadzima, Why Jared Kushner Will Probably Fail, Fortune, Apr 2, 17]
Shut up, science, politics reigns now. The new Trumpster business leader EPA Administrator ruled that a dangerous insecticide had not been compellingly proven unsafe, and therefore would not be banned. The EPA scientists said that the evidence shows that it is dangerous and that it should be banned unless and until it can be proven to be safe. The burden of proof is thus shifted from safety to profitable commerce in crops and chemicals, which can buy politicians more readily than it can convince scientists. When burden of proof is up for grabs, either politics or the courts will rule.
For the first time in the post–World War II era, the federal government no longer funds a majority of the basic research carried out in the United States. ... falling below 50% in 2013 [Jeffrey Mervis, Science, Mar 10, 17]
a new White House agency called the “Office of American Innovation”, headed by his son-in-law, Jared Kushner; which will hold extensive powers to overhaul federal procedures and potentially privatize certain government responsibilities, by culling ideas from the business community, according to a report in The Washington Post ... The intent to create a new administrative office flies in the face of arguments from members of the President’s inner circle that the Federal Government has become too bloated and has wrestled too much control from other branches of government and the states. It’s also another attempt to entrench policy creation inside the executive branch and away from Congress [techcrunch.com, Mar 27, 17] Heard that before: Reagan's Grace Commission, Clinton's Re-Inventing Government, Obama's SWAT team. Eventually, anything of import has to pass Congress which fiercely protects its constituents. Makes nice sounding announcements, followed by silence or silly ideas as long as they try to run government like a business. Government is about societal stability, not efficient profit-making.
Two well known congressional drug pricing critics launched a preemptive strike on PTC Therapeutics over its soon to be launched steroid for Duchenne muscular dystrophy, deflazacort (Emflaza), while Trump, during a Monday speech in Louisville, again vowed to introduce drug pricing legislation in the near future. ... Congressional drug price hawks Sen. Bernie Sanders (I-VT) and Rep. Elijah Cummings (D-MD) urged PTC Therapeutics to charge about $1,000 a year for deflazacort, a steroid that helps treat Duchenne. That’s the cost of importing the drug from the U.K. and Canada. [Ben Fidler, xconomy.com, Mar 24, 17] The politicians conveniently ignore the realistic costs of developing such a product and making enough profit to cover the partial development many more drugs that never succeed all the way to sales. But then politicians deal only in votes.
Fungible money. Can philanthropy fill R&D grant gap if feds back away? Can philanthropy fill the gap left by reduced federal research grants? Phil Blair, Manpower [says] NO: There always will and always has been a finite amount of philanthropic dollars. If it is moved to foster research projects, then it will be taken from some other great cause. [Phil Blair, Manpower, San Diego Union Tribune, Mar 23, 17]
Protecting the jewels. The Trump administration is reportedly in the early stages of drafting a new policy on Chinese investments in sensitive American technology firms, circulating a white paper which argues that American controls on such investments are falling short. [Foreign Policy sitrep, Mar 23, 7]
One of the most acclaimed accounts of the economic and social anxiety of Rust Belt Americans was the 'Hillbilly Elegy,' a memoir by venture capitalist J.D. Vance. Vance made news recently when he announced he would be leaving Silicon Valley to move back to Ohio. Now he's got a new job to go along with the move. Vance will be joining Revolution LLC as a partner, and specifically focusing on helping Steve Case run the Rise of the Rest tour, to drive more investment and entrepreneurship outside of Silicon Valley, Boston and New York. [Ryan Ferguson, DCInnoBeat, Mar 22, 17]
Why security folk hate to share classified intelligence with politicians. Rep. Devin Nunes (R., Calif.), who is leading a congressional investigation into alleged Russian interference in U.S. elections, shared his information with the media and Mr. Trump before he gave it to other members of his committee. [Wall Street Journal, Mar 23, 17] Politics first, eveything else last.
When a GOP president loses The Wall Street Journal: The paper's staunchly right-wing editorial board posted an extraordinary piece last night.[DefenseOne, Mar 22, 17] If President Trump announces that North Korea launched a missile that landed within 100 miles of Hawaii, would most Americans believe him? Would the rest of the world? We're not sure, which speaks to the damage that Mr. Trump is doing to his Presidency with his seemingly endless stream of exaggerations, evidence-free accusations, implausible denials and other falsehoods. [Byron Tau and Rebecca Ballhaus, Wall Street Journal, Mar 23, 17]
Chicago officials are establishing a program to help draw immigrant entrepreneurs they say will help grow companies and generate jobs. Mayor Rahm Emanuel announced the formation of the Global Entrepreneur in Residence program earlier this month. Five area universities will participate in helping sponsor immigrants for H-1B visas, which apply to highly skilled workers, as in the technology industry. (U.S. News & World Report) [reported by Crain's Washington DC, Mar 20, 17]
“Transformation” was infamously all things to all people. Mentioned 89 times in the 2001 [Quadriennal Defense Review] QDR, transformation sought to “extend America’s asymmetric advantages well into the future” across virtually every operational and institutional area. The meaning was entirely in the eye of the beholder; Pentagon bosses would routinely tell staff to “sprinkle some transformation” on ideas they wanted senior leadership to fund. [Defense One, Mar 20, 17]
while the president promised to reduce the trade deficit, the $5.8 billion cut from the [NIH] budget surely won’t help decrease our $55.8 billion trade deficit in pharmaceutical products. NIH funds more than 300,000 researchers across the country and represents the nation’s feedstock of pharmaceutical research. ... the budget calls for the elimination of programs such as the Manufacturing Extension Program (MEP), which has proven highly successful at increasing productivity for small-and medium-sized manufacturers. For every one dollar of federal investment, MEP generates almost $18 dollars in sales growth for manufacturers. [Scott Andes, Brookings, March 17, 2017]
The race to woo companies has intensified as state and local governments struggle with a slow economic recovery, sluggish new business formation and job losses resulting from automation. Many older industrial cities see tax incentives as one of the few levers they can pull. ... By 2015, the total annual cost of these incentives was $45 billion, according to the analysis, by Timothy Bartik, a senior economist at the W.E. Upjohn Institute for Employment Research [Ruth Simon, Wall Street Journal, Mar 16, 17]
The Trump Administration’s skinny budget proposal calls itself, “A Budget Blueprint to Make America Great Again.” From the information contained in the document, it is clear the Administration does not view science, technology, innovation and entrepreneurship and the economic development efforts built around those activities as the path forward to making “America great again.” ... [would cut] all funding for the Manufacturing Extension Partnership and ARPA-E, and would impose significant reductions in research spending by most agencies. [SSTI, Mar 16, 17] How handy a phrase "make great again," which can mean whatever the speakers says it means. Just a negotiating stance for a developer who demands everything of his prospective business deals.
It's different this time. “This time a ‘Great Leader’ has appeared..” The last time Robert Shiller heard stock-market investors talk like this in 2000,... the Nobel Prize-winning economist says, traders were captivated by a “new era story” of technological transformation: The Internet had re-defined American business and made traditional gauges of equity-market value obsolete. Today, the game changer everyone’s buzzing about is political: Donald Trump and his bold plans to slash regulations, cut taxes and turbocharge economic growth with a trillion-dollar infrastructure boom. “They’re both revolutionary eras,” says Shiller, who’s famous for his warnings about the dot-com mania and housing-market excesses that led to the global financial crisis. [Jason Clenfield and Adam Haigh, Bloomberg.com, Mar 13, 17]
Funding for the National Institutes of Health, the nation’s premier medical research funding agency, would be cut by 18%, or $5.8 billion, from levels enacted for fiscal 2017, under the Trump administration budget. The agency’s budget would total just under $26 billion, the lowest level in 15 years. [Thomas Burton, Wall Street Journal, Mar 15, 17]
Do as I say. When it comes to America’s technology industry, Donald Trump takes a dim view of foreign workers. “I will end forever the use of the H-1B as a cheap labor program and institute an absolute requirement to hire American workers for every visa and immigration program,” he said in a statement a year ago. “No exceptions.” When it comes to the hospitality industry, though, Trump is much more, well, hospitable. His Administration recently made it harder to get H1-B visas, but he has expressed no objection to the visa category that hotels and resorts use—the H-2B—to attract low-cost, low-skilled seasonal labor. In fact, at Mar-a-Lago, his Palm Beach club, the visas are still in active use. [Sheelah Kolhatkar, New Yorker, Mar 14, 17]
Slower worker visas. U.S. Citizenship and Immigration Services said it plans to temporarily suspend fast-track processing for the skilled-worker visa program, a move that could slow down the process of hiring foreign workers for U.S. companies. Starting April 3 and running for up to six months, the agency will no longer allow H-1B applicants to pay an additional fee of $1,225 to get a response within 15 days [Rebecca Ballhaus, Wall Street Journal, Mar 7, 17]
New health offer: return taxes to the rich and make health insurance dearer for the unrich. Elections have consequences. The angry less-educated under-employed voters in the Midwest may notice their loss.
The Advanced Research Projects Agency-Energy (ARPA-E) announced that a group of 74 project teams has attracted over $1.8 billion in private sector follow-on funding since the agency’s founding in 2009. ... In addition, ARPA-E, tasked with supporting transformative innovation in the energy sector, announced that 56 projects have formed new companies, 68 projects have partnered with other government agencies for further development, and an ever-increasing number of technologies have been incorporated into products sold on the market today. read ARPA-E investments [ARPA-E press release, Feb 27, 17] A note: one project gave Alcoa nearly $6M to develop a more efficient refining process. Why does the industry leader need government subsidy? Maybe the ultra-political new SECENERGY from Texas can find some votes in purging government spending invented by the previous Energy administration run by real scientists.
David Stockman fiscal disaster prediction. “I think what people are missing is this date, March 15th 2017. That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015. That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop. The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown. There will not be Obama Care repeal and replace. There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.” [Tyler Durden, zerohedge.com, Feb 27, 17] The Donald "I am the king of debt." will have his chance to play president with an amateur WH staff, a frozen Congress, and a public that wants to keep their benefits.
SBIR Extension. NASA has a deal for companies that have successfully completed Phase II funding under any federal agency’s SBIR or STTR program. The Civilian Commercialization Readiness Pilot Program (CCRPP) may be your next opportunity to secure additional funding for your innovation. NASA is reintroducing CCRPP to further advance innovative technology with high potential for commercial impact. Through CCRPP, NASA seeks to mature SBIR/STTR developed technology from a combination of further SBIR/STTR program investment and non SBIR/STTR program investor funds. NASA will match investments with SBIR/STTR program funds up to $2 million for each CCRPP award. Eligible firms must identify and obtain commitment from an investor to provide matching funds prior to submission of the CCRPP application. The technology proposed for advancement toward commercialization should have a strong relevance to NASA, as well as a strong potential use by NASA and/or markets outside of NASA beyond the CCRPP investment. [NASA announcement, Feb 2017] NASA wants third-party validation - money invested - in tech successes that NASA chose on the basis of the value to NASA programs. An idea I started 25 years ago of tying SBIR investment levels to market demand as an indicator that the tech has a future beyond government succor. Other agencies have tried variations on the idea. If NASA really cared about the follow-on, it would make investment potential a competitive criterion for Phase II. Instead, the mission agencies use SBIR to fund their regular R&D and then pretend to make lemonade with "commercialization" programs. NASA cannot invest directly in any company or commercialization because its SBIR money is aappropriated exclusively for R&D, but it cam make co-investment in the company a criteron for funding specific R&D.
Ready, set, re-organize. The defense secretary wants to reform the sprawling department’s business functions and reorganize key executive offices. [Defense One, Feb 22, 17] Meanwhile, the AF cannot explain Trump's claim of saving $1B on Boeing plane, one of many inexplicable Trump claims.
A Pentagon-funded unit called the MD5 National Security Technology Accelerator, which coordinates it all behind the scenes, gives students a modest budget to try to solve military problems using off-the-shelf products. After a test run at Stanford University last spring, the accelerator is starting similar courses at least a dozen universities. The University of Pittsburgh, University of San Diego, James Madison University and Georgetown University are among those trying to replicate Stanford’s success. [AAron Gregg, Washington Post, Feb 20, 17]
Is nothing sacred?
Trump let Boeing CEO
listen in on Pentagon
call about Lockheed fighter [Seattle Times, Feb
16, 17] “The
discussions that we had were all
pre-decisional,” Lt. Gen. Bogdan tells lawmakers. ....
Martin had no comment on the phone calls.
One, [Feb 17, 17]
The Texas Medical Center’s TMCx accelerator announced its new, and largest ever startup class. Twenty-four health IT companies will come to Houston for the four-month program. In addition to the size of the class, another item of note is the fact that many of the participating companies are more mature than before—with three having already raised at least $10 million in funding, said Erik Halvorsen, director of TMC’s Innovation Institute. [Angela Shah, xconomy.com, Feb 15, 17]
SBA now has a confirmed administrator, Linda McMahon, with no apparent background in SB politics or adminstration. Like many of Trump's stable of top officials, her prime qualification is that she made a lot of money in business.
Sick dams neglected. Part of the problem, officials said, is that as a rule, the government is more inclined to invest money in building new projects, celebrated with elaborate ribbon-cutting ceremonies overseen by elected officials, than in the less visible (and less glamorous) task of maintenance. [ADAM NAGOURNEY and HENRY FOUNTAIN, New York Times, FEB. 14, 2017]
Minnesota and local units of government within its borders spend an average of at least $239 million — or $45 per capita — on subsidies each year, according to a 50-state investigation by the New York Times. That puts Minnesota far behind Alaska ($704 million per year or $991 per capita), but ahead of Nevada ($33.4 million per year or $12 per capita). Minnesota’s most subsidized industries are agriculture, finance and telecommunications. .... The Mayo Clinic, for which the legislature approved subsidies worth $585 million to turn its campus into a “destination medical center.” The clinic’s CEO had threatened to expand the clinic in another state without a subsidy from Minnesota. ..... Medtronic Inc. sealed a $22.9 million tax increment financing deal with Mounds View in 2005 to help it build a new facility. In 2014, the company announced it would move its headquarters to Ireland because of lower taxes (it still has some of its operations and jobs in Minnesota). .... Worth it? a 2004 study by University of Iowa regional planning professors found that economic development subsidies didn't seem to create jobs or provide fiscal benefits to states. [Greta Kaul, Twin Cities Business, Feb 2, 17] Oh yes, the politicians love it as they announce gifts to constituencies, with little chance of poor economic valuation being noticed years later. SBIR has survived for thirty years on the game.
If Twitter can’t materially benefit from a phenomenon like Trump [exposure that money just can’t buy], it probably won’t from anything else either. ... a streak of decelerating growth every quarter Twitter has been public. .... Mr. Greenfield of BTIG compared the president’s tweeting to Franklin Roosevelt’s “fireside chats” that made radio popular in his four terms as commander in chief. One of the big beneficiaries of that time was Radio Corporation of America, or RCA, which ultimately became the largest U.S. radio manufacturer. Prior to the Great Depression, RCA was one of the most heavily traded stocks on the New York Stock Exchange. But investing in RCA during Mr. Roosevelt’s presidency would have been a bad move. Even as radio thrived, RCA’s stock collapsed and didn’t reclaim its 1929 peak until the mid-1960s, [Steven Russolillo, Wall Street Journal, Feb 8, 17]
The U.S. and Japanese militaries successfully intercepted a medium-range ballistic missile with an Aegis and SM-3 late Friday off the Hawaiian island of Kauai, CNN reports. "The US Missile Defense Agency announced that the USS John Paul Jones detected, tracked and took out the target ballistic missile using its onboard Aegis Missile Defense System and a Standard Missile-3 Block IIA interceptor. [Defense One, Feb 6, 17]
Microsoft, join legal fight against immigration ban
[Seattle Times, Feb 6, 17] The core legal question, not the
political or economic
advisability, is whether the President has
absolute power to decide what is necessary for national security under
prevailing law. Whichever side loses this legal argument will
appeal to the Supreme Court, which could eventually lead to a
Congressional effort to modify the law, which this President would
almost certainly veto.
A business administration. States and tech companies argued furiously before an appeals court that Trump wrongly and arbitrarily chopped off approved visa entry into the US from seven Muslim majority countries none of which had any business dealings with the sitting President. Not included were countries, equally Muslim dominated, that did have business dealings with the president. DOJ argued that the law gives the President full authority to decide who enters the US. The authors of that law no doubt assumed an honest President with no conflicts of interest. The President characteristically insulted the federal judge that called a temporary halt to the ban. Surprise, wide suffrage elections have consequences.
A business administration. States and tech companies argued furiously before an appeals court that Trump wrongly and arbitrarily chopped off approved visa entry into the US from seven Muslim majority countries none of which had any business dealings with the sitting President. Not included were countries, equally Muslim dominated, that did have business dealings with the president. DOJ argued that the law gives the President full authority to decide who enters the US. The authors of that law no doubt assumed an honest President with no conflicts of interest. The President characteristically insulted the federal judge that called a temporary halt to the ban. Surprise, wide suffrage elections have consequences.
On your own, caveat emptor, again. Trump’s move to roll back the Obama-era fiduciary rule amounts to a reprieve for parts of the financial-services industry and puts the onus back on retirement savers to avoid conflicts by stockbrokers. [Michael Wursthorn and Lisa Beilfuss, Wall Street Journal, Feb 3, 17] Financial stocks, already among the biggest winners since the election, just got fresh fuel to go higher. [Aaron Back ,Wall Street Journal, Feb 3, 17] Meanwhile, Trump's lightly educated and unemployed Rust Belters are still waiting for some crumbs from the presidential table.
Some reports have claimed that the administration may seek to entirely eliminate the Advanced Research Projects Agency–Energy program, the Office of Energy Efficiency and Renewable Energy, and the Office of Fossil Energy. [MIT Tech Review, Feb 1, 17] Every $1M external R&D cut will reduce SBIR funding by $30000. And Trump is not an R&D champion, nor is his Rasputin Bannon. Their prime economic interest is jobs in the Rust Belt even though their trade talk and moves so far might well kill more jobs than they create.
President Trump this week ordered that any agency issuing a new rule find two to repeal. He will likely discover that the only thing harder than getting something done in Washington is getting it undone. ... Mr. Trump’s order requires the costs of any new rule be fully offset by repealed rules in any given year, but has yet to specify how to measure those costs. No cost estimate exists for many rules, and those that do haven’t been updated since the rules were passed. [Greg Ip, Wall Street Journal, Feb 1, 17]
Nowrasteh, an immigration expert at
the libertarian Cato Institute, estimates the average American has a
one in 3.6 billion chance each year of being killed by a refugee who
becomes a terrorist, meaning there is a small benefit from the new
rule. At the same time, he puts the cost of Mr. Trump’s order at $350
million per life saved since fewer immigrants make the workforce less
efficient. By comparison, federal guidance usually puts the statistical
value of a human life at $10 million. [Greg
Street Journal, Feb 1, 17] Oh well, politics has a way of
ignoring or abusing economics when votes are at stake.
The nominee for SBA head said nothing about SBIR in her testimony before the Senate Commerce Committee according to Wall Street Journal recap Jan 27.
The Washington Post is also hearing things , and reports there are more orders coming down ... [to] direct the Pentagon to quickly develop plans to reduce spending on items not deemed ‘highest priority,’ while ramping up programs to expand the armed forces.” [Foreign Policy sitrep, Jan 27, 17] SBIR would qualify as not highest priority, especially as it is up for re-authorization again.
Jobs for Americans (robots). Trump's pick for labor secretary outsourced his fast-food company's technology department to the Philippines, a move that contradicts Trump's vow to keep American jobs in the U.S. ... also has talked about deploying robots to replace American workers who demand higher wages. Robots, he said, are always polite, never late and don't sue their employers for discrimination, according to an interview with Business Insider. [LAURIE KELLMAN, AP, Jan 27, 17]
NY; $1.8M SBIR) raised
in its Series C financing round, officials said. ....
and manufactures immunoassay technology, in the form of microchips,
that can identify proteins and genetic markers in medical samples such
as blood, officials said. The funding will help the firm
production capacity in St. Peters, Mo., where its manufacturing
facility is based. [Kerry Feltner, Rochester
Journal, Jan 20, 17] If Trump really wanted to grow good US
could see that the federal agencies steer SBIR to companies like Adarza
instead of sheltering companies that just service government
The mission agencies might go along if the amount of money were
substantially cut so the programs didn't feel like hey had to have a
fair share of it for what theycould do better anyway in open
competition. Unfortunately for his "deplorables", they won't qualify
for the new good jobs, but then Trump's dream of satisfying them with
good jobs is a fantasy anyway.
Protectionism amounts to the claim that everyone benefits when choices go down and prices go up. [Jeff Jacoby, Boston Globe, Jan 24, 17] Trump's romance with protective nationalism caters to the uncompetitive workers in several states and the racist elements in many states. His big bold moves will eventually suffer from the realties of economics as his tax plans benefit him and his rich friends. The tax plans and the shrinkage of government will also hurt those uncompetitive workers for whom he has no good solutions. But they can suffer the consequences of their voting actions in the face of real life economics of automation.
The emperor muzzles speech. Trump moved quickly this week to shore up its control over communications with the public and the press, as officials at the Environmental Protection Agency and the U.S. Department of Agriculture e-mailed staff to inform them that they may no longer discuss agency research or departmental restrictions with anyone outside of the agency—including news media. Both agencies also told their scientists and other staff that press releases and external communications about taxpayer-funded work would stop until further notice. It remains unclear if these will be temporary or long-term policies. [Dina Fine Maron, Scientific American, Jan 24, 17]
Trump wants to undo the liberal international order the U.S. built and replace it with a 19th-century model of nationalism and mercantilism. Measured in terms of great-power peace, prosperity, and freedom, the liberal order was the most successful international order the world has ever known. Its unwinding cannot, and will not, be pretty [maybe] as turbulent as the 1910s, the 1930s, the 1940s, or even the 1960s.. [Thomas Wright, Brookings, Jan 22, 17] Just what we need, turmoil and uncertainty, with a side order of revenge.
Hardline. he chose a dark, hard-line alternative, one that appeared to herald the end of a 70-year American experiment to shape a world that would be eager to follow its lead. In Mr. Trump’s vision, America’s new strategy is to win every transaction and confrontation. [David Sanger, New York Times, Jan 20, 17] Strangely, his first move was to strangle government regulations - a move that benefits only corporate profits. The common RustBelt unemployed will have to wait their turn for crumbs from the corporate table. As for Trump' ability to fix the economics, presidents have far less control over the economy than you might imagine. Presidential economic records are highly dependent on the dumb luck of where the nation is in the economic cycle. And the White House has no control over the demographic and technological forces that influence the economy. [Neil Irwin,, New York Times, Jan 20, 17]
No free lunch. Barry Eichengreen of the UCal Berkeley sees “double-digit” dollar appreciation as a possible consequence of Trump’s fiscal stimulus, tax reform and protectionist trade policy. [Alessandro Speciale and Mark Deen, Bloomberg View, Jan 16, 17] You can never change just one thing, nor can a politician command free growth, if indeed he can produce growth at all. Fortunately for Trump, the people in the Rust Belt that launched him into office don't study the dismal science of economics. They just bought the snake oil.
Save a trillion, pres. IBM CEO Ginni Rometty and the other tech leaders presented Trump with ideas that could save the government $1T by, you guessed it, enacting a slate of new tech-based policies. Such ideas should come as no surprise, since this is a group of executives from the tech sector. Among the proposals are improvements in supply chain operations ($500 billion), getting rid of fraudulent payments ($270 billion) and just modernizing IT facilities and operations ($110 billion). [Rex Crum, mercurynews.com, Jan 12, 17] Too bad, pres, all that tech will remove a lot of jobs.
The owner of a small business in Arizona confronted Paul Ryan at a town hall this week: “I am standing here today alive” only because of an early Affordable Care Act program that offered coverage to people with preexisting medical problems. [Washington Post, Jan 14, 17]
If you follow federal technology policy. Washington Bytes is a forum for a diverse set of knowledgeable experts to debate and discuss the top technology and communications policy issues at play in the Nation’s Capital. The blog is intended to attract new ideas and fresh thinking from across the tech community regarding policies that impact the digital economy and its citizens. Launched by George Washington University and hosted by Forbes, says DC InnoBeat.
Amazon.com revealed plans to hire more than 100,000 people in the U.S. in the next 18 months, grabbing the spotlight as President-elect Donald Trump pushes companies to employ more Americans. [Spencer Soper and Jing Cao, Bloomberg News, Jan 12, 17] Expect warm praise from The Donald, but don't expect anyone to actually count the offset loss of 120,000 jobs in competing enterprises, because job loss has no political benefits.
Robert F. Kennedy, Jr., who is one of the most famous proponents of the anti-vaccination movement, has said that Donald Trump wants him to chair a committee on vaccines and scientific integrity. .... Outrage is a lot like a drug: the more we are exposed to, the more we require to keep us angry. But the Trump vaccine commission is not simply a bad idea—it is a deadly one. Asking Robert F. Kennedy, Jr., to chair a commission on scientific integrity is like asking Ted Kaczynski to run the United States Postal Service. [Michael Specter, New Yorker, Jan 11, 2017]
Capitalist speaks heresy. many investors fled drug stocks after President-elect Trump said pharmaceutical companies were "getting away with murder" by charging high prices for drugs. [reuters, Jan 11, 17] What's a patent for, and what is a free market? And what does Trump really stand for? And how does he price his hotel rooms?
DIY numbers. Trump said that there "are 96 million wanting a job and they can't get (one). You know that story. The real number. That's the real number." It is unfortunately very far from the real number. There are in fact 96 million Americans age 16 and older who are not in the labor force. Of this, just 5.4 million, or 91 million fewer than the number cited by Trump, say they want a job. The rest are retired, sick, disabled, running their households or going to school. [Steve Liesman, CNBC, Jan 11, 17]
Making law without .... lawyers. Teacher, farmer, personal chef, anesthesiologist, graduation photographer and auto dealer are among the professions of the Kansas Senate’s men and women. What the lawmaking body doesn’t have this year: a single lawyer. .... The top Republican and Democratic lawmakers on the U.S. Senate Judiciary Committee, responsible for vetting President-elect Trump’s judicial appointments, never went to law school ... By contrast Roughly half the Founding Fathers—the Declaration of Independence signers and members of the 1787 Constitutional Convention—were lawyers. [Jacob Gershman, Wall Street Journal, Jan 11, 17] An explanation for the cockamimi laws, fantasy economics, and impulsive tweets emerging these days?
More amateur hour. Trump attacked the pharmaceutical industry in his first press conference as president-elect, accusing drugmakers of “getting away with murder” and pledging to “save billions of dollars” by changing how the U.S. purchases drugs .... Mr. Trump’s comments rattled the stock market, and shares of drugmakers fell sharply. [Joseph Walker, Wall Street Journal, Jan 11, 17] What would a real estate developer know about the economics of medical R&D while making grand pronouncements on the subject? Perhaps Novartis could comment on luxury hotels overbuilding with government subsidies.
Can they spell conflict of interest? President-elect Donald Trump’s cabinet nominees include several [five] who have financially backed the same people now charged with determining if they are qualified for their new posts. ... Mr. Sessions, Mr. Trump’s nominee for attorney general, through his leadership PAC has donated $42,500 to seven of the eight Republican senators on the Senate Judiciary Committee, which conducted his confirmation hearing. [Rebecca Ballhaus, Wall Street Journal, Jan 10, 17] Remember Trump ran against the "elites" who sponsored Hillary. Those angry white males in the Rust Belt may be watching with interest.
Backing off tax magic. [Kansas] Republican Gov. Sam Brownback said he will propose "modest, targeted" tax increases to help close Kansas' serious budget shortfalls while strongly defending an income tax break that some fellow GOP lawmakers want to end. [John Hanna, AP, Jan 10, 16] Brownback found the same result as Reagan did: supply-side tax policy is a mirage as the beneficiaries merely salt away their windfall.
Ask for the moon. With President-elect Donald Trump demanding more ships, the Navy is proposing the biggest shipbuilding boom since the end of the Cold War to meet threats from a resurgent Russia and saber-rattling China. The Navy's 355-ship proposal released last month is even larger than what the Republican Trump had promoted on the campaign trail, providing a potential boost to shipyards that have struggled because budget caps that have limited money funding for ships. [David Sharp, AP, Jan 9, 17] Not so bad; Reagan wanted 600 ships. Considering the growingh arsenal of anti-ship weapons out there, the Navy will at least need a decent reserve. But most would be built in Democratic voting Northeast states.
Apocalypsism suspended. Not long ago prominent Republicans like Paul Ryan, the speaker of the House, liked to warn in apocalyptic terms about the dangers of budget deficits, declaring that a Greek-style crisis was just around the corner. But now, suddenly, those very same politicians are perfectly happy with the prospect of deficits swollen by tax cuts; the budget resolution they’re considering would, according to their own estimates, add $9 trillion in debt over the next decade. Hey, no problem. [Paul Krugman, New York Times, Jan 9, 17] As always in politics, where you stand depends on where you sit, in the unending quest to satisfy the lowest common denominator of constituent.
As we welcome in the Trump administration, it’s important for everyone to remember that we lead the world in innovation in no small part because of the U.S. government’s commitment to science and technology funding. Without it, innovation will slow significantly. Don’t forget the cuts that the government made in these efforts in the mid to late 1980’s in order to help balance the budget left us without the next big innovation. The government R&D that developed the basis for the internet was the last one of the significant efforts. [Kjell Stakkestad Guest blogger, Phoenix Business Journal, Jan 4] If a project depends on cost-benefit calculation, it's probably not research. Government research should be invested in answering the question: How does nature work?
The incoming administration’s incentive to engage in fake policy is obvious: It’s the natural counterpart to fake populism. Mr. Trump won overwhelming support from white working-class voters, who believed that he was on their side. Yet his real policy agenda, aside from the looming trade war, is standard-issue modern Republicanism: huge tax cuts for billionaires and savage cuts to public programs, including those essential to many Trump voters. [Paul Krugman, NY Times, Jan 5, 17] Krugman also assails the news media for headline stories about minor jobs news.
Trump tweeted that GM is sending Mexican-made Cruzes to the U.S. tax-free. He told GM to make the cars in the U.S. "or pay big border tax!" [Tom Krisher, AP , Jan 3, 17] Big talk, but only Congress can invent taxes. And Congress has a lot of vested interests to keep happy, especially since making the Cruze hatchbck model for US market would occupy only a day's production in the Chevy plant.
A G.O.P. plan to gut an ethics office fell apart, but it revealed to an outraged public that Republicans never intended to drain the swamp. [New York Times, Jan 4, 17] They wanted more self in self-policing.
More hope than Obama's. The big winner in 2016 was the small-company Russell 2000 stock index, which gained 19.5%. The small-cap index got a huge lift after Election Day, surging nearly 14% as investors began to price in what they believe will be a better outlook for smaller, domestically focused U.S. companies under a Trump administration. .... The stock market, which once feared a Trump presidency, has rallied sharply since the billionaire businessman’s surprise win. The so-called “Trump Rally” has been driven by a belief that the president elect’s business-friendly policies will be a major boost to the economy and, most important, corporate profitability. [Adam Shell, USA Today, Dec 30, 16] Signs are that free-market big biz is back in the saddle with Trump cronies heading the departments, especially SBA.Trump didn't have much operating room in picking liutenants since he didn't do government in his real estate empire. No sign of a job-making revolution he promised in campaign days, and the Republicans in Congress may or may not tone down the love of small biz in programs like SBIR. Stand by for almost anything.
Talk was easy, institutions powerful. candidates with magical solutions, promising a painless and rapid restoration of prosperity. ... will almost certainly be disappointed. The scale and complexity of modern societies, entrenched private interests, and institutions ossified by powerful countervailing forces increasingly make radical reformations difficult -- even in the face of widespread dissatisfaction. In all likelihood, nothing much will change in 2017 [Sayajit Das, Bloomberg View, Jan 2, 17]Republicans have won their chance. Now it is time to see what they can do with it. [New York Times, Jan 2, 17] Their apparent first two moves in support of the forgotten men who voted them into office: tax cuts for the rich and health insurance removal for 30 million sick and unappreciated common folk.
Mr. Cohen notes that all presidential candidates’ views of national security change once they’re in office, because they’re forced to confront the world as it is, not the world as they wish it to be. The problem is that Mr. Trump apparently does not sit still for the intelligence briefings that try to describe the world as it is. And if that’s the case, the future may not be as dark as Mr. Cohen foresees. It may be darker. [reviewing Elliot Cohen's The Big Stick, New York Times, Jan 2, 17] On the campaign trail, talk is free and often fantasy. In office, action counts and has consequences as the enemy gets a vote.
Michael Lewis on Trump: “The truly bad thing about Trump is that he’s exploiting for his own gain the envy that some people feel, playing on their resentments. He denigrates and preys on people who are unlucky and then reinforces the good fortunes of people who are already lucky.” [Walter Isaacson, Washington Post, Jan 1, 2017]