Government
Economics in Fiction, Catch-22 Edition
I’ve talked before how certain ideas or lessons in economics can be found in works of fiction, such as how Bryan Caplan’s idea of rational irrationality…
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I’ve talked before how certain ideas or lessons in economics can be found in works of fiction, such as how Bryan Caplan’s idea of rational irrationality was illustrated in an episode of House, M.D. It turns out there are a few different ideas illustrated in Joseph Heller’s novel Catch-22.
For those who haven’t read the book, the story of Catch-22 is about an American military pilot in World War II named Yossarian. He wants to get out of fighting, on the grounds that every time he flies a mission, people on the other side try to kill him. He tries every trick he can think of to game the system to avoid flying more missions, and often argues with his superiors in favor of being relieved of duty.
In doing this, Yossarian illustrates a classic free-rider problem in economics. Free-rider problems can occur when an activity depends on a collective effort to which nobody in particular has an incentive to contribute. The author makes it clear that Yossarian is fully aware of the free-rider problem, and that Yossarian simply doesn’t care – he thoroughly owns his position and feels no shame in it. This is shown in a bit of dialogue where Yossarian is arguing with one of his superiors, who asks if Yossarian simply wants America to lose the war, leading to the following exchange:
“We won’t lose. We’ve got more men, more money, and more material. There are ten million people in uniform who could replace me. Some people are getting killed and a lot more are making money and having fun. Let somebody else get killed.”
“But suppose everybody on our side felt that way.”
“Then I’d certainly be a damned fool to feel any other way. Wouldn’t I?”
And this is exactly what creates a free-rider problem. If everybody else is willing to fight, Yossarian’s best move is to avoid the conflict and let others do the fighting. If nobody else is willing to fight, then Yossarian’s best move is still to avoid the conflict, because he’d be the only one doing the fighting.
(It’s worth pointing out that regarding war, the free-rider problem is really only a “problem” if the war in question is both just and necessary. In the case of a war that is unjust or unnecessary, the free-rider problem would actually be a free-rider solution!)
Another important economic point is illustrated in the backstory of the officer Yossarian argues with in the above bit of dialogue, a man whose first, middle, and last names are all Major. Upon joining the Army, he is immediately promoted to the rank of Major, making his full rank and name out to Major Major Major Major. His father was determined to give him this name entirely for his own amusement. The author tells us, “A lesser man might have wavered that day in the hospital corridor, a weaker man might have compromised on such excellent substitutes as Drum Major, Minor Major, Sergeant Major, or C Sharp Major, but Major Major’s father had waited fourteen years for just such an opportunity, and he was not going to waste it.”
But the economically relevant point made by Major Major’s father is not about his keen sense of branding. Instead, Major Major’s father illustrates the often-overlooked idea that contrary to popular belief, businessmen are not dedicated supporters of capitalism. They are, at best, asymmetric supporters of capitalism, wanting capitalism and competition for everyone else, and socialism and protectionism for themselves. Major Major’s father, a farmer, was very much an example of this in action:
Major Major’s father also illustrated another important point in economics. Subsidizing something leads to more of that something. And when you subsidize idleness or wasteful behavior, you get more of that too. Major Major’s father just so happened to benefit from a government program that paid people to not grow food crops. Major Major’s father was very responsive to the incentives created by this program:
The last point relevant to economics I’ll be bringing up is when Yossarian is grousing at everything he thinks is wrong with the world. In his tirade, he insists that God did a sloppy job of making such a broken world, asking “Why in the world did He ever create pain?” When he’s told pain is useful because it warns us of bodily damage, he retorts with the following:
Yossarian is missing an important point about pain, which is related to an important point about prices. Pain and prices are both conveyers of information – of bodily damage in one case, and of relative supply and demand for some commodity in another case (at least, when prices are allowed to adjust freely). But they both do more than merely provide information – they also provide an incentive to act on that information. Simply knowing something isn’t enough to create an incentive to respond to it. When price controls created gas shortages in the 1970s, it’s not as though the shortage of gas was something people were somehow unaware of – the long lines people would sit in for hours waiting for a chance to get some gas was a pretty good indicator. But, in the absence price adjustments, merely knowing there was a gas shortage wasn’t enough to meaningfully change people’s behavior. Price spikes can be painful, but they create the necessary incentive for producers to make more of something and for consumers to cut back on their use of it. An economy without price spikes would be like a body without pain – seemingly beneficial in the very narrow, very short run, and endlessly deteriorating in the long run.
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Government
Low Iron Levels In Blood Could Trigger Long COVID: Study
Low Iron Levels In Blood Could Trigger Long COVID: Study
Authored by Amie Dahnke via The Epoch Times (emphasis ours),
People with inadequate…
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Authored by Amie Dahnke via The Epoch Times (emphasis ours),
People with inadequate iron levels in their blood due to a COVID-19 infection could be at greater risk of long COVID.
A new study indicates that problems with iron levels in the bloodstream likely trigger chronic inflammation and other conditions associated with the post-COVID phenomenon. The findings, published on March 1 in Nature Immunology, could offer new ways to treat or prevent the condition.
Long COVID Patients Have Low Iron Levels
Researchers at the University of Cambridge pinpointed low iron as a potential link to long-COVID symptoms thanks to a study they initiated shortly after the start of the pandemic. They recruited people who tested positive for the virus to provide blood samples for analysis over a year, which allowed the researchers to look for post-infection changes in the blood. The researchers looked at 214 samples and found that 45 percent of patients reported symptoms of long COVID that lasted between three and 10 months.
In analyzing the blood samples, the research team noticed that people experiencing long COVID had low iron levels, contributing to anemia and low red blood cell production, just two weeks after they were diagnosed with COVID-19. This was true for patients regardless of age, sex, or the initial severity of their infection.
According to one of the study co-authors, the removal of iron from the bloodstream is a natural process and defense mechanism of the body.
But it can jeopardize a person’s recovery.
“When the body has an infection, it responds by removing iron from the bloodstream. This protects us from potentially lethal bacteria that capture the iron in the bloodstream and grow rapidly. It’s an evolutionary response that redistributes iron in the body, and the blood plasma becomes an iron desert,” University of Oxford professor Hal Drakesmith said in a press release. “However, if this goes on for a long time, there is less iron for red blood cells, so oxygen is transported less efficiently affecting metabolism and energy production, and for white blood cells, which need iron to work properly. The protective mechanism ends up becoming a problem.”
The research team believes that consistently low iron levels could explain why individuals with long COVID continue to experience fatigue and difficulty exercising. As such, the researchers suggested iron supplementation to help regulate and prevent the often debilitating symptoms associated with long COVID.
“It isn’t necessarily the case that individuals don’t have enough iron in their body, it’s just that it’s trapped in the wrong place,” Aimee Hanson, a postdoctoral researcher at the University of Cambridge who worked on the study, said in the press release. “What we need is a way to remobilize the iron and pull it back into the bloodstream, where it becomes more useful to the red blood cells.”
The research team pointed out that iron supplementation isn’t always straightforward. Achieving the right level of iron varies from person to person. Too much iron can cause stomach issues, ranging from constipation, nausea, and abdominal pain to gastritis and gastric lesions.
1 in 5 Still Affected by Long COVID
COVID-19 has affected nearly 40 percent of Americans, with one in five of those still suffering from symptoms of long COVID, according to the U.S. Centers for Disease Control and Prevention (CDC). Long COVID is marked by health issues that continue at least four weeks after an individual was initially diagnosed with COVID-19. Symptoms can last for days, weeks, months, or years and may include fatigue, cough or chest pain, headache, brain fog, depression or anxiety, digestive issues, and joint or muscle pain.
Government
Walmart joins Costco in sharing key pricing news
The massive retailers have both shared information that some retailers keep very close to the vest.
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As we head toward a presidential election, the presumed candidates for both parties will look for issues that rally undecided voters.
The economy will be a key issue, with Democrats pointing to job creation and lowering prices while Republicans will cite the layoffs at Big Tech companies, high housing prices, and of course, sticky inflation.
The covid pandemic created a perfect storm for inflation and higher prices. It became harder to get many items because people getting sick slowed down, or even stopped, production at some factories.
Related: Popular mall retailer shuts down abruptly after bankruptcy filing
It was also a period where demand increased while shipping, trucking and delivery systems were all strained or thrown out of whack. The combination led to product shortages and higher prices.
You might have gone to the grocery store and not been able to buy your favorite paper towel brand or find toilet paper at all. That happened partly because of the supply chain and partly due to increased demand, but at the end of the day, it led to higher prices, which some consumers blamed on President Joe Biden's administration.
Biden, of course, was blamed for the price increases, but as inflation has dropped and grocery prices have fallen, few companies have been up front about it. That's probably not a political choice in most cases. Instead, some companies have chosen to lower prices more slowly than they raised them.
However, two major retailers, Walmart (WMT) and Costco, have been very honest about inflation. Walmart Chief Executive Doug McMillon's most recent comments validate what Biden's administration has been saying about the state of the economy. And they contrast with the economic picture being painted by Republicans who support their presumptive nominee, Donald Trump.
Image source: Joe Raedle/Getty Images
Walmart sees lower prices
McMillon does not talk about lower prices to make a political statement. He's communicating with customers and potential customers through the analysts who cover the company's quarterly-earnings calls.
During Walmart's fiscal-fourth-quarter-earnings call, McMillon was clear that prices are going down.
"I'm excited about the omnichannel net promoter score trends the team is driving. Across countries, we continue to see a customer that's resilient but looking for value. As always, we're working hard to deliver that for them, including through our rollbacks on food pricing in Walmart U.S. Those were up significantly in Q4 versus last year, following a big increase in Q3," he said.
He was specific about where the chain has seen prices go down.
"Our general merchandise prices are lower than a year ago and even two years ago in some categories, which means our customers are finding value in areas like apparel and hard lines," he said. "In food, prices are lower than a year ago in places like eggs, apples, and deli snacks, but higher in other places like asparagus and blackberries."
McMillon said that in other areas prices were still up but have been falling.
"Dry grocery and consumables categories like paper goods and cleaning supplies are up mid-single digits versus last year and high teens versus two years ago. Private-brand penetration is up in many of the countries where we operate, including the United States," he said.
Costco sees almost no inflation impact
McMillon avoided the word inflation in his comments. Costco (COST) Chief Financial Officer Richard Galanti, who steps down on March 15, has been very transparent on the topic.
The CFO commented on inflation during his company's fiscal-first-quarter-earnings call.
"Most recently, in the last fourth-quarter discussion, we had estimated that year-over-year inflation was in the 1% to 2% range. Our estimate for the quarter just ended, that inflation was in the 0% to 1% range," he said.
Galanti made clear that inflation (and even deflation) varied by category.
"A bigger deflation in some big and bulky items like furniture sets due to lower freight costs year over year, as well as on things like domestics, bulky lower-priced items, again, where the freight cost is significant. Some deflationary items were as much as 20% to 30% and, again, mostly freight-related," he added.
bankruptcy pandemic trumpGovernment
Walmart has really good news for shoppers (and Joe Biden)
The giant retailer joins Costco in making a statement that has political overtones, even if that’s not the intent.
Share this:
As we head toward a presidential election, the presumed candidates for both parties will look for issues that rally undecided voters.
The economy will be a key issue, with Democrats pointing to job creation and lowering prices while Republicans will cite the layoffs at Big Tech companies, high housing prices, and of course, sticky inflation.
The covid pandemic created a perfect storm for inflation and higher prices. It became harder to get many items because people getting sick slowed down, or even stopped, production at some factories.
Related: Popular mall retailer shuts down abruptly after bankruptcy filing
It was also a period where demand increased while shipping, trucking and delivery systems were all strained or thrown out of whack. The combination led to product shortages and higher prices.
You might have gone to the grocery store and not been able to buy your favorite paper towel brand or find toilet paper at all. That happened partly because of the supply chain and partly due to increased demand, but at the end of the day, it led to higher prices, which some consumers blamed on President Joe Biden's administration.
Biden, of course, was blamed for the price increases, but as inflation has dropped and grocery prices have fallen, few companies have been up front about it. That's probably not a political choice in most cases. Instead, some companies have chosen to lower prices more slowly than they raised them.
However, two major retailers, Walmart (WMT) and Costco, have been very honest about inflation. Walmart Chief Executive Doug McMillon's most recent comments validate what Biden's administration has been saying about the state of the economy. And they contrast with the economic picture being painted by Republicans who support their presumptive nominee, Donald Trump.
Image source: Joe Raedle/Getty Images
Walmart sees lower prices
McMillon does not talk about lower prices to make a political statement. He's communicating with customers and potential customers through the analysts who cover the company's quarterly-earnings calls.
During Walmart's fiscal-fourth-quarter-earnings call, McMillon was clear that prices are going down.
"I'm excited about the omnichannel net promoter score trends the team is driving. Across countries, we continue to see a customer that's resilient but looking for value. As always, we're working hard to deliver that for them, including through our rollbacks on food pricing in Walmart U.S. Those were up significantly in Q4 versus last year, following a big increase in Q3," he said.
He was specific about where the chain has seen prices go down.
"Our general merchandise prices are lower than a year ago and even two years ago in some categories, which means our customers are finding value in areas like apparel and hard lines," he said. "In food, prices are lower than a year ago in places like eggs, apples, and deli snacks, but higher in other places like asparagus and blackberries."
McMillon said that in other areas prices were still up but have been falling.
"Dry grocery and consumables categories like paper goods and cleaning supplies are up mid-single digits versus last year and high teens versus two years ago. Private-brand penetration is up in many of the countries where we operate, including the United States," he said.
Costco sees almost no inflation impact
McMillon avoided the word inflation in his comments. Costco (COST) Chief Financial Officer Richard Galanti, who steps down on March 15, has been very transparent on the topic.
The CFO commented on inflation during his company's fiscal-first-quarter-earnings call.
"Most recently, in the last fourth-quarter discussion, we had estimated that year-over-year inflation was in the 1% to 2% range. Our estimate for the quarter just ended, that inflation was in the 0% to 1% range," he said.
Galanti made clear that inflation (and even deflation) varied by category.
"A bigger deflation in some big and bulky items like furniture sets due to lower freight costs year over year, as well as on things like domestics, bulky lower-priced items, again, where the freight cost is significant. Some deflationary items were as much as 20% to 30% and, again, mostly freight-related," he added.
bankruptcy pandemic trump
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Students lose out as cities and states give billions in property tax breaks to businesses − draining school budgets and especially hurting the poorest students
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Low Iron Levels In Blood Could Trigger Long COVID: Study
Walmart has really good news for shoppers (and Joe Biden)
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