Category: Uncategorized

More Regulatory Overreach in California

Posted on by Max Sherrill

There’s nothing wrong with a state regulatory agency setting service standards for connectivity, such as time to repair an outage — as long as the regulators adopt a reasonable and workable approach.

Unfortunately, staff at the California Public Utility Commission (CPUC) have jumped the shark. The regulators are proposing to impose draconian outage repair requirements and penalties on carriers, that would require all VOIP (Voice over IP) and wireless outages to be fixed within 24 hours, with costly fines escalating over time. The standard would effectively impose fines on carriers for not fixing outages right away, even when that outage is well beyond the provider’s control.

These fines — which would be automatically credited back to customer accounts — could add up quickly in the case of widespread outages, well in excess of what a customer pays for monthly voice service.

Why is this a problem? Significantly, the proposed action would impose a completely unrealistic perfection standard that provides no flexibility for factors well beyond the control of the carrier.  Reasonable exemptions should be included that at a minimum provide an accommodation when there is a lack of commercial power, wildfires, snowstorms, earthquakes, floods, or falling trees, on the one hand, and lack of access to customer premises on the other. However, the staff proposal does not include sufficient flexibility. It is not hard to imagine the absurd results that this will create. For example, imagine a planned commercial power shutoff (e.g., a PSPS or “public safety power shut off”) put in place by Southern California Edison due to a wildfire that results in a loss of power to a community that stretches into two days and impacts all homes and businesses. Under the standard proposed, VOIP providers would be fined for the loss of their service even though the loss of power (and its restoration) is well beyond their control and core business.

In addition, there is nothing a provider can do to correct or prevent an outage when the cause is outside of the provider’s control, whether they are fined for the outage or not. While the proposed CPUC standard exempts outages during governor-declared states of emergency, factors outside of the voice provider’s control arise at other times, including snowstorms, floods, or downed trees, on the one hand, and lack of access to the consumer on the other.

Indeed, it’s a fact of life that some outages take longer to fix than others. A tree falling on a broadband cable in a remote area will take more time to repair than the typical suburban line problem. A lot of trees falling because of a storm will stress repair capabilities. The staff’s proposed standard does not account for these modern-day realities.

If the  CPUC staff’s proposal is adopted, this could result in less build-out of new lines to vulnerable rural areas. Suppose that a carrier is deciding whether to build out new facilities in an area that is prone to outages due to natural causes (e.g., fire, earthquakes, floods, etc.). Punishing the carriers too heavily for unavoidable outages will make some proportion of the new lines uneconomical to build and maintain. Similarly, on a statewide level, given different and competing regulatory environments throughout the nation, excessively strict outage penalties could discourage telecom investment in California more generally — an unnecessary loss for the state and its consumers.

At the same time, the new standards will give customers an incentive to game the system, since they benefit directly from the fines. If a carrier can’t get access to a customer’s home or property to fix a problem, then the fines—and customer credits—can mount up quickly, even if the carrier can’t do anything.

Finally, excessively onerous service quality standards will require additional repair equipment and personnel, artificially boosting the price of voice services for California residents. Requiring an unrealistic 100% 24-hour repair standard, particularly if it includes causes beyond the provider’s control, is a luxury that poor and middle-class consumers cannot afford.

Nobody likes communication outages, and nobody disagrees that they need to be fixed as soon as possible. But customers also like low prices, greater innovation, and more telecom investment in rural areas. Excessively tight outage repair standards and punitive penalties undercut both of these.

It does not have to be this way. A more effective framework to protect consumers would calibrate penalties and fines to better focus on outcomes that are squarely within the control of the provider. For example, in New York, rather than punishing VOIP providers for loss of service due to a power outage that is beyond their control, automatic consumer credits do not kick in until commercial power has been restored for 24 hours. And the credit is directly proportionate to the length of the outage and the price of the service the customer pays. This still protects consumers while establishing more realistic expectations for providers.

It is time for California regulators to recognize that more and more regulation is not the key to success and effective consumer protection, especially when such regulation punishes conduct well outside of the control of the regulated company.

Regulations and penalties should be targeted and measured to protect consumers and encourage businesses to continue to invest and operate in the state.

Kahlenberg for National Affairs: A Way Forward on Housing

Posted on by Max Sherrill

By Richard D. Kahlenberg

American housing policy is a mess. Although housing already constitutes the largest budget item for most families, government artificially inflates the prices of homes by suppressing their supply. In many regions, housing has become unaffordable for low-income and working-class Americans, and for young middle-class adults starting out in life. Rich and poor increasingly live apart, driving unequal educational opportunities and political and racial polarization. Because housing can be prohibitively expensive in the most economically productive regions of the country, many Americans are no longer moving to opportunity; instead, they move for affordability.

Potential solutions are controversial. Democrats and Republicans tend to differ on matters like rent control, funding for the Department of Housing and Urban Development’s (HUD) Housing Choice Voucher program, and efforts to desegregate residential areas through the Affirmatively Furthering Fair Housing (AFFH) rule under the Fair Housing Act.

Intriguing possibilities of bipartisan reform, however, have emerged in one area of housing policy: local zoning barriers that inhibit housing growth and exclude people by income (and, in turn, often by race as well). Several states and localities have adopted zoning reforms in recent years, frequently with support from both parties. The federal government has also devoted some attention and funding to the issue.

Keep reading in the National Affairs Summer 2024 Issue.

Ainsley in The Times: Harris’s border talk is textbook Starmer

Posted on by Max Sherrill

Pete Kavanaugh, deputy campaign director to Biden in 2020; Muthoni Wambu Kraal, who built a winning electoral coalition at the grass roots that year; Amy Dacey, once chief executive of the Democratic National Convention — these are the kinds of people who remain in constant conversation with Labour on how exactly the left defies stereotype and fights the right on the ground it usually owns.

This is a shared project with a shared infrastructure. Claire Ainsley, once director of policy for Starmer, has made much of this transatlantic traffic happen from her post at the Progressive Policy Institute, the favoured think tank of the White House. And next week Labour is sending its own delegation to the Democratic convention in Chicago, led by its victorious general secretary David Evans, and Jon Ashworth, whose failure to retain his Leicester South seat has obscured the extent of his influence over an otherwise successful campaign.

The challenge now is to keep speaking the same language. Recession looms over America. Starmer may yet end up on the wrong side of Britain’s fraught debate on migration. And party strategists are not their parties, whose habits are harder to shift. “The jury is still out,” frets one influential Labour MP. Some fear that “wet and self-important” Labour backbenchers, as well as West Coast liberals, will revert to type rather than adopt this new lingua franca. For the time being, though, Harris and Starmer are protagonists created by the same writers’ room.

Read more in The Times.

Manno for RealClearEducation: Is Recalibrating Advanced Placement Exams Defining Deviancy Down?

Posted on by Max Sherrill

By Bruno Manno

There is nothing abnormal about deviance. This is a lesson I learned growing up during the 1950s and early 1960s in an Italian American neighborhood called Collinwood on the east side of Cleveland, Ohio. While the neighborhood had plenty of conformity, there was also sufficient forbearance for enough deviance to make life interesting and educational.

Years later in the early to mid-1970s, I found myself a Ph.D. student in a seminar on the works of the French sociologist Emile Durkheim. I was pleasantly surprised that the lesson I learned growing up was one of Durkheim’s important sociological insights into our common life.

Durkheim showed that deviance performs at least four important functions in society. It affirms our cultural values and norms; clarifies our moral boundaries; brings us together; and encourages social change by challenging our views. Moreover, our neighborhood was a good example of what’s called the Durkheim Constant: there is a limit to the amount of deviant behavior that a community will tolerate since deviant behavior causes conflict.

Keep reading in RealClearEducation.

Ritz for Forbes: There’s A Better Way To Cut Taxes For Workers Than Exempting Tips

Posted on by Max Sherrill

By Ben Ritz

When Donald Trump and Sen. Ted Cruz (R-Texas) first proposed to exempt tips from federal income taxes last month, it sounded to many like a common-sense way to give tax relief to working Americans who feel left behind by Washington policymakers. But the proposal was deeply flawed: low-income service workers already have little-to-no federal income tax liability. The main beneficiaries would be savvy professionals who reclassify the bulk of their income from wages to tips, for which the legislation introduced by Cruz had no guardrails to protect against. Tax experts from across the political spectrum rightly panned the idea.

Unfortunately, Kamala Harris gave bipartisan cover to this dubious new loophole by endorsing a modified version of it last weekend. Harris marginally improved upon the GOP proposal by calling to limit tax-exempt tips to workers in the service and hospitality industry, and only for those whose total annual incomes are below a number to be specified later. But let’s say she were to use the same income threshold of $125,000 that the Biden administration used for other “means-tested” policies over the past four years. Is it really fair for a server at a high-end restaurant making $125,000 to pay a lower tax rate than a retail worker or public-school teacher making half as much? No.

If Harris or Trump want to give real tax relief to working families across the country, the right way to do so would be by repealing the 15.3% federal payroll tax that workers and their employers pay on labor income up to $168,600. The average waiter would see their annual take-home pay increase by up to $5,000 if the payroll tax were repealed, which is more than twice the tax cut they would get if tips were exempted from federal income taxes. And unlike the misguided tip tax exemption, this policy would also benefit working Americans who earn most of their incomes through wages instead of tips.

Although repealing the payroll tax in isolation from other tax and spending reforms would be prohibitively expensive for the federal government, my team at the Progressive Policy Institute published a comprehensive blueprint last month that shows it can be done while simultaneously putting the federal budget on a path back to balance within 20 years.

Keep reading in Forbes.

Trade Fact of the Week: The ‘African Growth and Opportunity Act’ expires next year.

Posted on by Max Sherrill

FACT: The ‘African Growth and Opportunity Act’ expires next year.


THE NUMBERS: U.S. imports from Africa, 2000 and 2023 – 
2000 2023
Total $22.1 billion   $29.6 billion
Crude oil 67.7% 29.3%
Unworked diamonds & precious metals      8.4% 16.9%
Ores, slag, and ash   1.8%   1.8%
All else 22.5% 52.0%

Note: Nigeria, Angola, Chad, Equatorial Guinea principally oil exporters; South Africa metals and automotive; Botswana and Namibia diamonds both cut/polished and unworked; Kenya, Ethiopia, Madagascar, Senegal, Ghana, Mauritius light manufactures, clothing, agriculture.

WHAT THEY MEAN:

The quick story of U.S.-African trade since 2000: Americans buy less African crude oil, but more clothes, cocoa paste, flowers, wigs and hair extensions, shea butter, polished diamonds, auto parts, birdseed, and branded coffee. Crossing the Atlantic eastward, meanwhile, more American-made cars and tractors, telecom equipment, chicken and computer parts.

Where to next?  Looking ahead at July’s “AGOA Ministerial Conference”, the 29 participating African governments expressed three policy-speak hopes:

  1. “An expeditious and long-term renewal,” meaning a hope Congress will extend the 24-year-old African Growth and Opportunity Act — the law from which the annual AGOA Ministerial conferences take their acronym, now 13 months away from its September 2025 expiration — for 16 years or more, to “ensure predictability and stability in trade and investment relationships.”
  2. “Enhancing utilization,” echoing the concerns of U.S. Africa-watchers that U.S.-Africa trade remains relatively modest overall, and some eligible countries aren’t using the AGOA benefits as much as expected.
  3. “Eligibility and reviews,” meaning worry that over-enforcement of “eligibility criteria” (on human rights, rule of law, foreign policy, economics, gender equity, and other factors) could erode AGOA’s effectiveness as long-term policy for U.S.-African trade growth and African economic development.

Background: The AGOA law, passed in the last year of the Clinton administration, and last reworked in 2015, has two core components. The first, a tariff waiver, gives duty-free status to nearly all things grown or made in participating countries. (Currently 32 of the 49 sub-Saharan African countries.)  The second, a large “convening” program, holds annual Trade Minister conferences (the Washington session in July was the 20th) along with business dialogues, civil society fora, etc. The hope was to create a much larger U.S.-African economic relationship, and to shift Africa’s trade away from heavy reliance on energy and metal ore exports toward more labor-intensive and stable manufacturing and agricultural goods.

How well has it worked out? In raw dollars, U.S.-Africa trade is larger than in 2000, but not spectacularly so. Americans bought $22.2 billion worth of African* goods in 2000 and $29.6 billion in 2023. America’s own exports to Africa have grown faster — $5.9 billion in 2000, $18.2 billion last year — but aren’t very large either. And looking out from Africa the U.S.’ place in trade seems relatively smaller than it was in 2000: where that year’s $22.2 billion was about 20% of Africa’s $112 billion in exports to the world, 2023’s $29.6 billion is about 7.5% of a larger $406 billion.

These bottom lines are a bit misleading, though, because they mix volatile (and falling) oil with more stable (and growing) farm and factory goods. As U.S. oil imports from Africa have dropped from $15 billion to $9 billion, everything else — the clothes, cocoa paste, shea butter, auto parts, worked diamonds, hair extensions, etc. noted above — has jumped from $7 billion to $20 billion. So outside the big continental oil-producers Nigeria and Angola, trade data often look pretty impressive. A quick table:

IMPORT SOURCE 2000 2023 Change
Sub-Saharan Africa
 $22.21 billion       $29.61 billion         +21%
Nigeria $9.68 billion   $5.97 billion     -38%
Angola $3.34 billion   $1.18 billion     -65%
South Africa $4.20 billion $13.88 billion   +220%
Ghana $0.21 billion   $1.72 billion   +719%
Kenya $0.11 billion   $0.89 billion   +709%
Madagascar $0.16 billion   $0.72 billion   +350%
Botswana $0.04 billion   $0.57 billion +1325%
Ethiopia $0.03 billion   $0.49 billion +1533%
Senegal $0.01 billion   $0.16 billion +1500%

 

Thus, though China and more recently India long since overtook the U.S. as buyers of Africa’s oil and metal ores, Americans play a larger role in manufactured goods and farm products.  In that sense, AGOA does seem to be fulfilling one of its main goals, and the Ministers have good reason to hope Congress will act soon to keep it going. Lots of ideas on next steps, and some background below on the Ministers’ “utilization” and “eligibility reviews” points along with some American thinking.  Their Point 1, on the need for a renewal very soon, is timely and clear and doesn’t need much explanation.

* Using the “sub-Saharan” definition in AGOA — 49 countries — rather than the 55-country count of the African Union, which adds Egypt, Libya, Tunisia, Algeria, Morocco, and Western Sahara.

** Most don’t really need changes in the AGOA law, and the sad outcome of a 2020 attempt to rewrite the broader “Generalized System of Preferences” tariff waiver program for small and lower-income countries in a four-year-long lapse in the program coupled with endless arguments and tactical gambits – suggests it would be good to be cautious about big legal revision.

FURTHER READING

2024 AGOA Ministerial readout from the State Department and U.S. Trade Representative Office.

And for background, the USTR’s biennial reports on AGOA.

African perspectives:

African Trade Ministers on AGOA renewal, via the African Union.

“Utilization”: One of AGOA’s puzzles, highlighted in the Ministers’ comment on “utilization,” is that fewer countries use its tariff waivers than the program’s designers had expected.  The clothing tariff waiver, for example, provides not only duty-free status but “rules of origin” which in theory make AGOA cheaper and easier to use than U.S. free trade agreements. (Clothes are typically high-tariff products in the United States – top AGOA clothing imports such as acrylic sweaters get tariffs as high as 32%, and unlike Central American countries using the “CAFTA-DR” free trade agreement, duty-free African clothes can be made of fabric from anywhere in the world.)  But only six of the 32 current AGOA countries — Ghana, Kenya, Lesotho, Madagascar, Mauritius, Tanzania — sell any substantial amount of the clothes that show up in American outlets and malls.  Their $1.14 billion in clothing exports last year made up 99.6% of all AGOA clothing.

Why the relatively low use of this “centerpiece” AGOA feature? U.S. government analysis and outside observers see at least part of the reason in African policies.  Some AGOA-country governments haven’t developed the implementation plans the program suggests.  Some have geographical and cost disadvantages tariff benefits can’t overcome, as land-locked countries with shaky road and air connections to customers. And many have problems with port management, infrastructure quality, and import limits that raise production costs and erode competitiveness, and can be fixed at home.

Eligibility reviews: The Ministers, though, aren’t wrong to highlight “eligibility reviews” as a contributing factor.  Since 2016, AGOA’s membership has shrunk from 38 countries to 32, as U.S. administration has removed countries for failure to meet program eligibility rules on rule of law, human rights, and other topics. (Eight countries on the 2016 ‘eligible’ list are gone: Burkina Faso, Cameroon, Ethiopia, Gabon, Guinea, Mali, Niger, Uganda; two others, Mauritania and the Democratic Republic of Congo, have returned.)  Each decision had its own logic and legal background of course. But experience also shows that removals have costs. As a local example, Eswatini’s removal in 2014 over labor issues led to the collapse of AGOA garment trade and employment; they haven’t revived despite Eswatini’s return to the program in 2017. And in general, the Ministers are probably right to believe that this level of volatility reduces buyers’ confidence in AGOA as a long-term economic and developmental policy.

As an example, here are the January 2024 changes, with Mauritania back on the eligibility list and Gabon, Niger, and Uganda removed.

From the U.S. government:

U.S. “next-steps” ideas typically involve some way to manage “graduation” of countries reaching high-income status (as required under a different “preference” law, the Generalized System of Preferences), and seeking more reciprocal relationships with countries at higher income levels and with a more diversified industry. The Obama administration’s 2016 “Beyond AGOA”, even at eight years old, remains fresh.

And next steps:

A renewal proposal from Sen. Chris Coons (D-Dela.) and James Risch (R-Idaho).

June hearings on AGOA renewal from the House Ways and Means Committee and the Senate Finance Committee.

Assessment from Stellenbosch-based TRALAC (Trade Law Centre).

… while the International Monetary Fund looks at the Africa-China economic relationship.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

Read the full email and sign up for the Trade Fact of the Week.

 

New PPI Report Examines Impact of ‘Buy Now, Pay Later’ on Consumer Credit

Posted on by Max Sherrill

WASHINGTON — Amid growing concerns about economic instability and the risk of a wider economic downturn, the Progressive Policy Institute (PPI) has released a new report examining the rapidly expanding “‘Buy Now, Pay Later”’ (BNPL) trend. The report, titled “Buy Now, Pay Later: The New Face of Consumer Credit,” explores the benefits and risks of this emerging form of consumer credit and advocates for targeted regulations to protect consumers while encouraging ongoing innovation in the credit market.

Authored by Andrew Fung, an Economic Policy Analyst at PPI, the report highlights the growing popularity of BNPL services among young and low-income consumers, who are attracted to the flexibility these services provide in accessing goods and services that may otherwise be unaffordable. While BNPL loans can improve financial inclusion, they also carry significant risks, especially for consumers with limited financial literacy or those prone to overextending themselves financially.

“In today’s uncertain economic climate, it’s crucial to understand the patterns of consumer spending,” said Fung. “BNPL loans present a new way for consumers to access credit, but the rapid growth of this market requires careful attention to potential financial risks.”

The report outlines the current state of consumer credit, noting that while overall debt levels remain stable, there are emerging areas of concern that should be closely monitored. BNPL loans, with their smaller, fixed payment structures, are generally less risky than traditional credit cards. However, the report recommends sensible regulations, such as interest rate caps, clear loan term disclosures, and standardized dispute resolution processes, to protect consumers and support the sustainable growth of this credit option.

“As policymakers continue to navigate economic challenges, it’s important to examine the current state of consumer credit closely,” added Fung. “Our report provides a practical approach for ensuring BNPL can benefit consumers while mitigating potential risks to both individuals and the broader economy.”

The report also examines the demographic profile of BNPL users, revealing that these services are especially popular among Black, Hispanic, and female consumers, as well as those with household incomes between $20,000 and $50,000 per year. Although BNPL has grown rapidly, it still represents a relatively small portion of the overall American economy. However, its differences from traditional credit methods and the unique risks it presents are drawing increasing attention from policymakers.

Read and download the report here.

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on Twitter.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Buy Now, Pay Later: The New Face of Consumer Credit

Posted on by Max Sherrill

Introduction

Consumer credit plays two essential roles in our everyday lives. Instruments like credit cards make it possible for Americans to purchase everything from their daily latte to groceries and furniture with less friction, even if we have enough money in the bank. Beyond these smaller purchases, consumer credit also allows us to borrow to pay for bigger ticket items that may be too expensive to buy with their current resources. The second scenario can lead to a potentially dangerous expansion of household debt, which can trap some households in a debt spiral that’s hard to escape or have larger systemic effects.

This paper will consider the economic and policy ramifications of the current rapid expansion of one form of consumer credit, known as buy now, pay later (BNPL). Buy now, pay later loans serve as an alternative to traditional payment methods like credit cards when shopping online, allowing consumers to break up the cost of their purchase into several installments to be paid over the course of a few weeks or months, often with very low or zero interest. Understanding how this new form of consumer credit fits into the larger American economy is important, and this paper will explain why BNPL falls under the first category of consumer credit but does merit scrutiny and potential regulation as it continues to develop.

Read the full report.

Ainsley in The New York Times: Britain’s Anti-Immigrant Riots Pose Critical Test for Starmer

Posted on by Max Sherrill

Those close to Mr. Starmer say he is getting a grip on the disorder, drawing on his experience as a chief prosecutor in 2011, when riots took place in London and he pushed to get those responsible tried, sentenced and jailed swiftly to deter others.

“He has a detailed knowledge of how to do this, and he understands how you prosecute and convict quickly, and you do so visibly in a way that sends a message to anybody who is thinking about participating in one of these riots,” said Claire Ainsley, a former policy director for Mr. Starmer.

But ensuring that such violence does not recur is harder, she said.

“We have had the far right with us in good economic times and in bad economic times,” said Ms. Ainsley, who now works in Britain for the Progressive Policy Institute, a Washington-based research institute.

“But it is much harder for them to have any kind of influence when you are in better economic times,” she added. “That means people’s living standards rising and people starting to feel they are better off and that they are part of a system that is working — and that isn’t a description of Britain today.”

Ms. Ainsley pointed to the role of social media in spreading misinformation and stoking tensions, and cautioned against making a direct link between the riots and immigration. She noted that, alongside extremists, some of the rioters may be looters and other opportunists.

It is, she added, “wrong to assume that all of the people participating in these riots are politically motivated by immigration.”

Read more in The New York Times.

Jacoby for Washington Monthly: Ukrainian Public Opinion Remains Determined Against Russian Aggression

Posted on by Max Sherrill

By Tamar Jacoby

I’ve suspected for months that something was changing in Ukraine. Virtually everyone I had asked since the beginning of the war had maintained that Kyiv could win, with the only acceptable outcome being Russian withdrawal from all Ukrainian territory, including Crimea and the Donbas region controlled by Moscow since 2015. But last winter, you could sense a growing uncertainty, and a few of my friends began to whisper about alternative scenarios.

Two recent polls shed a bright light on these unusually unspoken concerns. One sounding, conducted in May by the Rating Group, found 27 percent of respondents uncertain that Ukraine would succeed in liberating all its lost territory, while 26 percent were willing to negotiate a compromise. Also in May, the Kyiv International Institute of Sociology (KIIS) found 32 percent—more than triple the number who agreed a year before—willing to give up “some” territory to “achieve peace and preserve [Ukrainian] independence.”

This doesn’t mean Ukrainians are ready to surrender. KIIS project manager Anton Grushetsky cautions against exaggerating his team’s findings. Given the situation on the ground, he argues, Ukrainians remain remarkably resilient. The fighting on the frontline is all but stalemated; Russian missiles bombard Kyiv and other cities every day. More than three-quarters of the country has lost a close friend or relative, and no one is confident of continued Western support. Still, only 32 percent are considering compromise, while more than half—55 percent—are standing firm, insisting that “no circumstances” could justify conceding territory.

Keep reading in Washington Monthly.

Manno for The Hill: Relief funds eased COVID learning loss but could have done more

Posted on by Max Sherrill

By Bruno Manno

Pandemic K-12 public school closings disrupted learning nationwide, with the average student in grades 3 through 8 losing the equivalent of half a grade level in math achievement and a third of a grade level in reading achievement.

The federal government’s response was a K-12 financial relief package of three bills for states and districts totaling $190 billion. The Elementary and Secondary School Emergency Relief package was the largest one-time federal investment in K-12 schools, with a Sept. 30 deadline to commit funds for specific uses.

Are the relief dollars making a difference in the learning loss recovery effort? There is good and bad news as students and teachers return to school.

The good news is that these funds are having a positive effect on helping students catch up. The bad news is they are insufficient to return all students to pre-pandemic learning levels. Additionally, we don’t know which newly funded programs helped students catch up.

Keep reading in The Hill.

Marshall for The Hill: Can Kamala Harris rebuild America’s anti-Trump majority?

Posted on by Max Sherrill

By Will Marshall

As the Paris Olympics wind down, it’s hard to say which has been the more riveting spectacle, the games or the 2024 presidential race. Next week’s Democratic National Convention in Chicago will cap a summer of high political drama with dizzying plot twists.

It began with Donald Trump’s history-making criminal convictions, which perversely seemed to help him sew up his party’s nomination.

Then came President Biden’s mercilessly revealing debate performance, Trump’s narrow escape from an assassin’s bullet and a GOP national convention in Milwaukee that looked more like a royal coronation.

Biden then upstaged the Republicans with his eleventh-hour handoff to Vice President Kamala Harris. This rattled Trump by depriving him of the grudge-match he’s been itching for ever since his stinging 2020 defeat.

Keep reading in The Hill.

Trade Fact of the Week: Tiger population estimates for Thailand’s Western Forest Complex are up from 40 in 2007 to a range of 189-223 this year.

Posted on by Max Sherrill

FACT: Tiger population estimates for Thailand’s Western Forest Complex are up from 40 in 2007 to a range of 189-223 this year.


THE NUMBERS: World wild tiger population estimates –
2024:  5,574
2022:  4,500
2010:  3,200
1980: ~35,000?
1900: ~100,000?

WHAT THEY MEAN:

From Thai newspaper Khao Sod last week:

“The Department of National Parks, Wildlife, and Plant Conservation released on December 19 the first photos of two tiger cubs and their mother in Slap Phra Wildlife Sanctuary, Kanchanaburi Province. … Over 420 automatic camera traps have been installed in 7 protected areas of the southern part of the Western Forest Complex to record the population of tigers and other wild cat species, including predators, from early 2023 to date. The area is a large wildlife corridor in a dry evergreen forest and is located near a large river. Analysis of the data from the automatic camera traps revealed that 3 tigers were photographed, an adult female listed in the tiger database under the code TWT128F, which is the mother tiger, and two cubs (with the codes SLT_Unknown003 and SLT_Unknown004).”

Is this an everyday event? A significant sighting? Probably the latter, and a very hopeful one.

Background: A 2018 National Academies of Science study guessed that, excluding fish, all the world’s vertebrates together weighed (in “dry carbon”) about 170 million tons. Humans and farm animals make up about 160 million tons of this. Vertebrate wildlife — that is, all the eagles, cobras, elephants, condors, whales, jaguars, deer, sea turtles, mice, frogs, bison, etc. — comes to a bare 10 million tons. From another perspective, Our World in Data summarizes three research papers and concludes that wild mammals weighed about 10 million tons (again in dry carbon) in 1900, and were down to 3 million tons by 2015.

Tigers’ sad modern history is part of this larger decline in wildlife and biodiversity. Zoologists guess that, when wildlife weighed 10 million tons in 1900, about 100,000 tigers patrolled a roughly triangular forest-mountain-steppe range with Korea at the top right, Indonesia at the bottom, and Iran at the top left. By 1980 the population was down to 35,000; by 2010 tigers were gone from Central Asia, Korea, Vietnam, Laos, and Cambodia, and three of the nine “subspecies” (the Caspian, Javanese, and Bali tigers) were declared extinct. The remaining 3,200 included a large group of about 2,000 Bengal tigers in India, 450 Amur tigers in Siberia, 400 Sumatrans in Indonesia, 200 Indochinese and South China tigers in Thailand, and smaller refuges of 100 to 200 in Bangladesh, Nepal, Bhutan, China, and Malaysia. The roughly 14,000 zoo and farm tigers distributed around Asia, Europe, and the United States likely outnumbered wild tigers by four or five to one.

The principal issue, for tigers as for other large wild animals, is a massive loss of habitat through conversion of wild areas to agriculture, pasture, and urban land; logging and road- and town-building, with attendant chopping up of forests into “fragments” and “islands”; and most recently climate change. As the pre-1900 tiger range contracted by about 95%, and the number of tigers shrank with it. Trade and economic factors, though a secondary concern, mean that as with elephants, rhinoceros, and Caspian sturgeon, tigers have declined faster than less “charismatic” wildlife: hunting for sport and pelts in the 20th century, more recent collection of cubs for exotic pets and tiger farming, and sale of tiger bones, blood, and organs for ill-founded medicinal purposes throughout.

Against this unhappy background, last week’s “Global Tiger Day” assessment provides, cautiously and tentatively, some reason for optimism. Since the 2010 low, wild tiger populations appear to have been growing, with surveys reporting worldwide populations of about 4,500 in 2022 and 5,574 this year. This isn’t because the estimates of the 2010s were too pessimistic or missed populations, but because of confirmation that tiger populations in several countries are beginning to rise.

Khao Sod’s report on the newly photographed cubs is an example of this. Thailand’s Western Forest Complex, a group of 12 national parks and seven wildlife sanctuaries, was thought home to around 40 tigers in 2007. By 2022 the population, tracked by the Forestry Department’s batteries of cameras, had grown to a range of “148 to 189,” and in 2024 it is “179 to 223.” Reasons: habitat has improved as government programs release prey species such as sambar deer into the sanctuaries; protection against poachers; and a program of joining disconnected sanctuaries and parks through protected “tiger corridors” – like the riverbank evergreen forest in which the mother and cubs turned up — which at least partially reverse past fragmentation of habitat into areas too small to support significant populations. Outside, meanwhile, the international environmental agreement CITES (“Convention on Trade in Endangered Species”), amplified over the past 20 years to ban domestic trade of wild tigers for pets, farming, pelts, and medicines as well as international trade — which has been banned since 1973 — may also be helping. Nor is Thailand uniquely successful: Nepal’s tiger count has risen from 121 to 355, and India’s from 2,967 in 2018 to 3,682 this year.

These are, of course, still small numbers — dozens and hundreds rather than the thousands necessary for a durable recovery. If threats of habitat loss and poaching are receding at least in some countries, climate-change concerns continue to grow. But for the first time in quite a while the trends have turned up, suggesting that tigers’ future may still be in forests rather than zoos. Perhaps, though later than you think, it’s still probably not too late.

FURTHER READING

Rebound:

… Khao Sod reports, with Western Forest Complex photos.

… Enthusiastic comment from the Thai government.

… The BBC looks at Nepal’s modestly recovering tiger population.

…The Hindu on rising tiger counts in India.

… And India’s National Tiger Conservation Authority.

Outside the forests:

How reliable are “zoo and farm tiger” estimates? Since the early 2000s, press and NGO reports have frequently used a figure of 5,000 in the United States, and sometimes suggested higher estimates of 7,000 or 10,000. A conservation group, the Feline Conservation Foundation, attempted a direct count in 2021. They identified 4,103 “big cats” including 1,538 tigers, 862 lions, 487 cougars, and 425 cheetahs. This doesn’t disprove hypotheses of the larger zoo and farm populations, but does put some question marks around very high numbers.

Policy:

… The U.S. Fish and Wildlife Service explains CITES.

… Immigration and Customs Enforcement estimates ~$7.8 billion to $10 billion in annual illicit wildlife trade, along with $7 billion in illegal timber trade and $4.2 billion to $9.5 billion in illegal/unreported/unregulated fishery trade.

… CITES next steps.

… And the World Wildlife Fund on tigers and climate change.

Two gloomy wildlife reports:

… Our World in Data summarizes trends in land mammal biomass.

… And PNAS looks at the big picture. Excluding nematodes and microorganisms, all world animal life weighs about 2.2 billion tons (in terms of “dry carbon.”) Bugs of various sorts — more technically, “arthropods” including insects, crustaceans, arachnids, mites, and so on — make up a bit less than half of this total. Fish at 700 million tons make up most of the rest. Humans and farm animals (including ducks and chickens) nearly equal worms, and there isn’t much space for vertebrate wildlife:

All animals 2,200 megatons
Insects, spiders, crustaceans 1,000 megatons
Fish 700 megatons
Worms 200 megatons
Farm animals 100 megatons
Jellyfish, coral, & spongse 100 megatons
Humans 60 megatons
Mollusks 20 megatons
All wild mammals, birds, & reptiles 10 megatons

 

PNAS’ study.

And two more modestly hopeful big-cat stories:

Asiatic lions remained at large in the wild from Iraq to India as recently as the 1940s, but are extinct outside western India. They also seem to be rebounding — though the numbers are nearly an order of magnitude smaller than those for tigers — with about 700, up from 400 20 years ago, in Gir Forest.

Closer to home, a wildlife biologist shot the last known U.S. jaguar in 1964. The jaguar population is much bigger than the tiger and lion groups, with about 175,000 of them living from Brazil and Peru to Mexico. Ten Mexican jaguars have been photographed exploring Arizona and New Mexico in this decade, so maybe there’s a return in prospect.  NGO Panthera explains.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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Moss in CNN: Google has an illegal monopoly on search, judge rules. Here’s what’s next

Posted on by Alex Terr

Monday’s decision against Google will likely be remembered in the same breath as other major antitrust cases throughout history, some antitrust experts said. That list includes the breakup of AT&T’s telephone monopoly and Standard Oil, as well as Microsoft’s illegal bundling of its Internet Explorer web browser with Windows, said Diana Moss, vice president and director of competition policy at the Progressive Policy Institute.

In each of those cases, Moss said, the courts highlighted a specific business practice or mechanism — such as Microsoft’s browser bundling — as a violation of US competition law.

The Google decision this week is no different, zeroing in on the search giant’s exclusive contracts and finding huge problems with the use of such by large, monopolistic firms.

“This is definitely a landmark,” said Moss, adding that “it’s very clear in signaling that the use of exclusive contracts in the hands of a monopolist violates the law.”

Read more in CNN.

PPI Statement on Selection of Minnesota Governor Tim Walz as Democratic Vice Presidential Nominee

Posted on by Max Sherrill

WASHINGTON — Today, Will Marshall, President of the Progressive Policy Institute (PPI), issued the following statement in response to Vice President Kamala Harris’ selection of Minnesota Governor Tim Walz as her running mate:

“Vice President Kamala Harris has made her first major decision since becoming the Democrats’ presumptive nominee – and it’s a good one. Minnesota Gov. Tim Walz is something you won’t find anywhere on the Republican ticket: A seasoned veteran of public service who knows how to bring Americans together and get things done.

“Gov. Walz brings the pragmatic perspective of Middle America to the Democratic ticket. He was a high school teacher and coach, a U.S. military veteran, and a former Member of Congress representing rural Minnesota. Now he’s a very popular Midwest governor in his second term, with a solid record of governing success under his belt.

“Throughout his career, Gov. Walz has shown a knack for winning the trust and votes of rural and working class voters. He flipped a swing district to win his House seat. In Congress, he stood out as a consistent public champion of the economic aspirations and moral outlook of ordinary working Americans.

“Nearly 15 years ago, as a junior member of Congress, he called for comprehensive deficit reduction, emphasizing the need to get our fiscal house in order — a vision that, if heeded, would have positioned us better today.

“Gov. Walz is a builder. As governor, he’s launched major infrastructure projects and called for permitting reform to ensure Minnesotans get access to better roads, schools and clean energy soon rather than the distant future.

“Harris’s choice of Gov. Walz to be her running mate contrasts favorably with Donald Trump’s selection of Ohio Sen. J.D. Vance. The callow Vance is an insult artist who adds little but a second troll to Trump’s ticket.

“Gov. Walz is a proven and radically pragmatic leader whose record shows he knows how to make American democracy work.”

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org.

Follow the Progressive Policy Institute.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Obsolete Laws Impede a Clean Energy Future: The Case Against the Jones Act

Posted on by Max Sherrill

The Jones Act is costing Americans billions in higher energy costs and delaying the deployment of green energy sources. To address these costs, in addition to the energy supply and environmental consequences of the status quo, lawmakers must reassess the utility of the act.

The Merchant Marine Act of 1920 — commonly called the Jones Act — is an obscure shipping law that requires vessels transporting goods between two U.S. ports be American-made, manned, and flagged. Originally motivated by principles of national security and protectionism, the law was passed to complement a wartime reinvigoration of domestic shipbuilding that saw the U.S. construct one of the most dominant merchant fleets in the world. A century later, however, the Jones Act now presents a major hurdle for domestic offshore energy projects and fuel transportation, resulting in higher energy prices for Americans and slower deployment of cleaner energy sources.

The U.S. offshore wind industry, already plagued by high interest rates, permitting delays, shoddy port infrastructure, supply chain issues, and recent high-profile turbine breakdowns, is desperately searching for ways to improve project costs and expediency. Building offshore wind turbines requires shipping enormous individual components to be assembled on-site, miles from land. In most countries, this is done using specialized vessels called wind turbine installation vessels (WTIVs). With no Jones Act-compliant WTIVs of its own, the U.S. employs smaller compliant vessels instead, which take significantly more trips to and from project sites, raising project costs and emissions. Currently, the U.S. only has one WTIV under construction — Dominion’s Charybdis — which has taken both years and hundreds of millions of dollars to build. Building and deploying Jones Act-compliant WTIVs is far more costly than simply enlisting foreign-owned ones, and that cost is ultimately reflected in project price tags. President Biden’s Bipartisan Infrastructure Law thankfully includes funding for port upgrades which will alleviate some of the infrastructure bottlenecks, but Jones Act reform, in addition to long overdue permitting reform, is essential for scaling offshore wind to meet our energy goals.

The act also has economic and climate implications for LNG markets. The U.S. is a major producer of natural gas, but domestic pipeline infrastructure–particularly in New England–is inadequate to satisfy consumer demand and balance the grid, and attempts to spur new projects are thwarted by neighboring states. This creates a local reliance on shipped LNG to bridge the gap, but foreign-owned vessels bringing gas from the Gulf of Mexico cannot sail to a second U.S. port, necessitating imports from abroad and slowing supply chains in a region where harsh winters make adequate seasonal energy supplies critical. And given New England’s poor electricity and gas pipeline infrastructure, many households there burn extra-dirty fuel oil for home heating that emits more greenhouse gas instead.

Because the U.S. does not possess any of its own Jones Act-compliant LNG tankers, shipped LNG that the Northeast does receive comes from Trinidad and Tobago and other distant countries. These import inefficiencies widen the rift between supply and demand, further inflating already disproportionately-high energy prices for New Englanders. With no foreseeable plans to revamp domestic shipbuilding to produce compliant LNG tankers, the law leaves regions like New England vulnerable to supply chain disruptions and stuck with an expensive and emissions-intensive energy system. These risks, in tandem with energy security concerns spurred by the war in Ukraine, motivated the New England governors to jointly request that the Department of Energy suspend Jones Act restrictions in 2022. A group of New England senators also wrote to DOE about inflated energy prices, citing increased U.S. exports as the cause of supply shortages. In reality, the Jones Act’s shipping rules and disjointed pipeline infrastructure limit supply mobility and leave consumers in the Northeast cut off from the rest of the country’s gas market, beholden instead to exports from abroad and the volatile international LNG trade.

Source: Esri ArcGIS

Energy transportation challenges imposed by the Jones Act also have heightened consequences for Americans outside the mainland. Geographically isolated places such as Alaska, Hawaii, and Puerto Rico are subjected to shipping constraints, cost burdens, and emergency response threats. In fact, the White House had to waive Jones Act requirements for LNG shipments to Puerto Rico in 2022 to enable the territory to recover from devastating hurricanes. And aside from LNG, Jones Act shipping restrictions on petroleum and oil products force Americans to forfeit roughly $769 million in unrealized consumer surplus annually — a conservative estimation which excludes areas with further inflated prices like Alaska, Hawaii, and Puerto Rico.

Ultimately, lawmakers must reassess the utility of the Jones Act. A protectionist law passed in the spirit of national security is no longer doing its job when it poses looming energy and economic concerns, and even stifles the industry it was designed to protect. Its limitations seem especially frivolous considering that the U.S. has no LNG carrier fleet of its own–and a reported 30-year timeline for building one–while countries such as South Korea are already building them more cheaply and efficiently. The lack of compliant LNG and wind turbine installation vessels, in tandem with the eye-popping costs and timelines for building them domestically, make foreign-flagged alternatives a sensible option if we could only use them.

The obvious solution is to repeal the Jones Act, however the political blowback from powerful proponents of domestic industry could be significant — despite the billions of dollars in potential economic output that would follow. At minimum, specific carve-outs or exemptions must be made for foreign specialized energy carriers to promote energy and economic security, particularly in at-risk regions. A large-scale subsidized campaign of domestic shipbuilding could offer another option in theory, but in practice the combination of high costs, fiscal and political uncertainty, existing difficulties with subsidized Navy shipbuilding, and the current availability of non-U.S. ships all strongly suggest that allowing foreign specialized energy vessels to travel between U.S. ports is the best course of action, at least in the short-term.

Until we adopt such reforms, the harmful effects of the outdated Jones Act are a stark reminder that ensuring security and reliability of clean energy–now and in the future–requires a regulatory regime that is not anchored to the past.