Bruce Yandle: Halt, they cried! But the inflation tide continues

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In recent days, the inflation indicators have stubbornly signaled that a high tide of prices is still soaking us consumers. Growing at a 3.5% annual rate in March, the Consumer Price Index has now exceeded expectations for three months and running. Once again, investors and financial decisionmakers — and isn’t that everyone with a bank account? — are playing the Federal Reserve guessing game.

What will the Fed and its 500 economists do now? After all, this is an election year. What about President Joe Biden? Is there something his nearly 2 million civilian executive branch employees can do? To Fed Chairman Jerome Powell, the frustrating and painful combination of interest rate hikes and orchestrated reductions in the money supply may be feeling like King Canute’s fabled attempt to counter an incoming tide.

According to legend, the 11th century Viking ruler of England, Denmark and Norway sought to prove to his fawning royal staff that, as much as they wished otherwise, even their king could not control the tides. Canute had his throne moved to the edge of the sea and then ordered the tides to halt and not wet his feet and robes. Of course, the tide paid no attention, and the king retreated to higher ground.

After admonishing his subjects not to expect unyielding forces to obey his commands, Canute proceeded to take other actions that would make life more pleasant. He set to work reducing tariffs and taxes imposed on his people when they made important pilgrimages to Rome and devoted his energies to other beneficial changes, all of which focused on policies that he could actually control.

Maybe Fed Chair Powell should admit that the Fed is not able to bring about calculated and systematic reductions in the price level at this time. Unpopular as it may be, perhaps he should admit that after the government spending spree that began during the pandemic and distorted the money supply, the inflation tide will ebb and flow. It seems clearer by the day that as long as Congress and the president continue to spend drastically more money than the nation takes in, they’ll fan inflation’s flames and make Powell’s job extremely difficult at best.

Lacking a king’s authority to deliver other policy benefits, Powell can only hope that Biden will also follow Canute’s lead. But Biden seems to be playing the opposing hand. Apparently believing that he can control the tides, Biden has launched a “Strike Force on Unfair and Illegal Pricing,” this in addition to his earlier efforts to jawbone the economic powers of the world into bringing down prices.

Yet while pushing his throne closer to the edge of the sea, Biden has also increased consumer prices by imposing higher tariffs on imported steel and automobiles. He’s marched with UAW workers to gain increased wages, which tend to push prices higher. And he’s happily canceled more than $7 billion in student debt while arguing that the burden was limiting former students’ ability to buy homes and other consumer goods. That ability, if bolstered, would also tend to push prices higher.

With Powell watching and no doubt hoping for beneficial results, Biden is sitting in his figurative throne waiting for inflation’s incoming tide to obey his command. Meanwhile, his almost countless staff members are cheering him on. When will Biden pull back from the edge and take other inflation-limiting actions?

Bruce Yandle is a distinguished adjunct fellow with the Mercatus Center at George Mason University, dean emeritus of the Clemson University College of Business & Behavioral Science, and a former executive director of the Federal Trade Commission. He wrote this column for Tribune News Service.

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Literary pick for April 28

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(Courtesy of the author)

Rain Taxi Review hosts an evening titled BANneD Books on May 3, its second annual event at Granada Theater in Minneapolis. This fundraiser for the nationally circulated literary journal will be a program of words and music, including musicians The Muatas, Willie Wisely and author/artist Zak Sally, former bassist for the Minnesota band Low, as well as readings by multi-talented Dessa and poet Danny Klecko.

Carolyn Kuebler (Courtesy of Rain Taxi Review of Books)

Special guest will be Carolyn Kuebler, who will launch her debut novel, “Liquid, Fragile, Perishable,” at the event. Kuebler has deep roots in the Twin Cities, having co-founded Rain Taxi Review of Books with Randall Heath. When she left Minnesota in 1999, Eric Lorberer took the helm of the Minneapolis-based publication that also sponsors readings and the popular Twin Cities Book Festival.

Kuebler, who edits the New England Review at Middlebury College in Vermont, recalled for her Melville House publisher her years in Minnesota:

“When I moved after college I had no idea what an indie press was, much less that the Twin Cities were such a hotbed for them. But I spent a formative decade there in the 1990s, and had my first publishing internship at Milkweed Editions while I worked downstairs at the Coyote Cafe. I later became a bookseller at Borders in Uptown (Minneapolis) a few years and wrote book reviews and other features for the late great City Pages. I then made my way to the Hungry Mind bookstore in St. Paul, where I was second-in-command for events — which at the time happened multiple times a week. David Unowsky was great at giving us a lot of creative freedom there, so I also made lots of displays and ordered lit journals. Most significantly, and thanks to Eric Lorberer most lastingly, in 1996 I started Rain Taxi with a couple of friends, and we published the first issue in 1997. I look back on that time as a kind of literature and publishing grade school, with a very self-directed program. I used to love riding my bike from Minneapolis to St. Paul, swimming and walking around the lakes and checking out shows at First Avenue and 7th Street Entry. The John Ashbery bridge from the Walker Art Center to Loring Park epitomized my sense of what the cities were all about.”

Kuebler’s novel, “Liquid, Fragile, Perishable,” tells the story of three young women in a small Vermont town with characters including newly transplanted New Yorkers who are among well-to-do couples building giant houses in the rural area, an old-school and decent Christian beekeeper whose wife keeps their daughter on a tight leash so she isn’t contaminated by girls at the local high school, young people from a hardscrabble family with few morals, and a lone and aging woman who believes she can live by herself even if it means walking six miles carrying groceries. All their lives are affected when the newcomers’ son falls in love with the beekeeper’s daughter.

The novel, one of Oprah Daily’s most anticipated reads of 2024, earned a starred review in Kirkus: “At times dark, at other times beautiful, Kuebler’s debut shines in its precision. It picks apart each character’s thoughts in an unusual clipped stream-of-consciousness narrative. The characters’ points of view fit together like an elaborate quilt, gradually coming together into a satisfying whole.”

Event details: 7 p.m. Friday, May 3, Granada Theater, 3022 Hennepin Ave., Mpls. General admission $30; VIP ticket for two $150. Tickets can be purchased in advance at: raintaxi.com/rain-taxi-fundraiser.

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Other voices: Government incompetence is keeping kids out of college

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President Joe Biden’s botched rollout of a revamped financial aid form reveals a stunning lack of managerial competence. It has left colleges unable to tell millions of students how much they’ll have to pay, causing some to delay enrolling and others to drop the idea altogether. This easily avoidable failure threatens to deprive low-income Americans of a college education. And Biden, the country’s chief executive, needs to hold to account the officials who are directly responsible.

The mess stems from the congressionally mandated overhaul of the Free Application for Federal Student Aid, or FAFSA, a form used to determine eligibility for government grants and loans. Once verified by the Education Department, student records are shared with colleges, which then inform students of their tuition costs based on the financial assistance they can expect. In past years, the FAFSA form — with more than 100 questions demanding more data than a tax return — discouraged many low-income students from completing the application, denying them thousands in grant money. In December 2020, Congress told the department to design something simpler.

The work took more than three years and cost $336 million — and the results have been disastrous. Launch delays and various technical snafus caused FAFSA completion rates to plummet by 40%. Despite having only half as many questions, the shorter form has somehow managed to be even more confusing. College counseling groups say it’s taking applicants twice as long to fill out.

The government is now months behind in sending student records to schools and state financial aid agencies. Many colleges aren’t expected to provide estimated aid packages until the summer, leaving families little time to weigh their options. Lacking a clear idea of expected costs, poorer students are less likely to enroll. That would exacerbate the post-pandemic drop in college enrollment — already at a two-decade low — and threaten the survival of dozens of cash-strapped institutions.

To call the government’s performance pathetic would be an understatement. Congressional Republicans have planned hearings on whether Biden’s misguided focus on student loan debt forgiveness distracted officials from fixing the FAFSA — a policy that, unlike the administration’s debt cancellation push, has actually been approved by bipartisan majorities in Congress. A thorough probe of this mismanagement is certainly warranted, as is a broader review of the federal government’s chronic inability to make basic upgrades to its technology.

But lawmakers should go further.

Authorizing the Internal Revenue Service to calculate families’ eligibility for aid when they file their tax returns would save a ton of paperwork and give students more time to plan. And there’s no reason why students from households that already qualify for means-tested federal benefits, such as food stamps, should have to submit the same information to the government twice. Ideally, Congress should order the Education Department to use income tax data to calculate students’ aid eligibility and give that information to colleges and students directly, phasing out the stand-alone FAFSA entirely. Research has shown that simplifying the financial aid process for low-income students can significantly boost their chances of starting and completing college.

There’s growing skepticism about the value of traditional college degrees, so it bears repeating that higher education remains a sound investment and tool of economic mobility for disadvantaged students. The government — including the president — should be making access easier, not getting in the way.

— The Bloomberg Opinion editorial board

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Lisa Jarvis: Idaho’s abortion ban is based on legal delusion and medical myth

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On Wednesday, a divided Supreme Court listened to arguments over a state’s abortion ban — its first such hearing since the justices overturned Roe v. Wade. The case, in which the Joe Biden administration is challenging Idaho’s abortion ban, literally puts the health and even the lives of pregnant women on the line.

The Biden administration is arguing that Idaho’s abortion ban should not supersede a 1980s-era federal law called EMTALA (Emergency Medical Treatment & Labor Act), which was designed to prevent hospitals from turning away poor or uninsured patients. The law was passed to stem a growing tide of patients being refused treatment. Under EMTALA, hospitals must stabilize someone whose life is at risk, including if it means terminating a pregnancy that puts them in immediate danger.

Saving a pregnant woman’s life sounds like a no-brainer, yet Idaho’s draconian abortion law only allows an abortion to be performed if it prevents the mother’s death, but not to protect her health. That puts doctors in the unfathomable position of deciding when a woman has teetered close enough to death that they aren’t breaking the law by treating her. If those doctors are later judged to have been too proactive, they could lose their medical licenses and even go to jail.

That has had a chilling effect on women’s health care in Idaho and beyond. Pregnant women have been turned away from hospitals across the country because they aren’t yet far enough over the precipice — maybe their blood pressure is dangerously high, but not yet life-threatening. Maybe they have an infection but have yet to show signs of sepsis.

And in Idaho, doctors fearful of prosecution are airlifting women to neighboring states. One of the state’s hospital systems has reportedly flown six pregnant women to other states since January. Some Idaho doctors are recommending that their pregnant patients buy insurance that covers emergency air transportation.

Yet several of the conservative justices seemed less worried about the potential for women to die and more concerned about how EMTALA could be used to undermine states’ rights. The discussion sometimes drifted into scenarios that are either extremely unusual situations or are pure fabrications meant to stoke concerns that striking down the law would create loopholes in abortion bans.

For example, U.S. Solicitor General Elizabeth Prelogar had to frequently remind the conservative members of the court that in most of these emergencies, doctors are not making a choice between saving the mom and saving her baby — when a pregnancy takes such a dark turn, the baby is often not going to survive. She also had to remind them that in cases where the baby has a chance of survival, the the usual medical advice is to deliver the baby early, not to perform a late-term abortion.

Then there’s the medical myth, raised by the Idaho’s attorney Joshua Turner and probed by Justice Samuel Alito, that if this law wasn’t upheld, someone in a mental health crisis could show up at an emergency room asking for and receive an abortion. As Preloger noted, terminating the pregnancy in such a scenario would be “incredibly unethical” and wouldn’t address the underlying issue, which is one of brain chemistry.

Waiting to treat a woman in crisis could have serious consequences. Waiting to provide care could cause a woman to lose her fertility. She could end up with kidney or neurological damage. She will be doubly traumatized — by the unavoidable loss of an often much-wanted pregnancy and by the completely avoidable experience of being denied care. And of course, if doctors cut it too close, women could die.

As Prelogar succinctly put it, “It just stacks tragedy upon tragedy.”

The impact of laws like Idaho’s extends far beyond the pregnancies where something goes seriously wrong. They encourage doctors to leave the state. A recent analysis of publicly available data by the Idaho Coalition for Safe Healthcare, led by a group of local doctors, found that the state lost 22% of its practicing obstetricians in the 15 months after its abortion ban went into effect. Meanwhile, two hospital OB programs have closed, one more is expected to close, and another is at risk of closing, the group said. That has left half of the state’s counties without a practicing obstetrician. That’s a predicament several other states could find themselves in if the court allows Idaho’s ban to stand.

Ruling in favor of Idaho could also affect states where abortion care is legal. Healthcare systems in neighboring states will need to be prepared to absorb their patients, of course. But it could also encourage Catholic hospital networks, which treat one out of every seven patients in the U.S., to use the law to take a tougher stance against terminating pregnancies that threaten the life of the mother.

As I’ve written before, bans like Idaho’s don’t obviate the need for abortion care. They only pretend that need doesn’t exist. The health impact of these draconian bans is unambiguous, and flies in the face of good medicine.

Lisa Jarvis is a Bloomberg Opinion columnist covering biotech, health care and the pharmaceutical industry. Previously, she was executive editor of Chemical & Engineering News.

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