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Bill Owens: Confounding And Confusing Events 7/12/21

One of the interesting phenomena occurring as the pandemic recedes, is millions of workers are quitting with a record 4 million doing so in April of 2021.  Many of the stories being related about the “why” go back to issues with commuting great distances for work, (particularly in metropolitan areas), inadequate time to spend with family, as well as the significant changes that have occurred in the manner in which we work. The latter is to a large extent the result of technology and the ability to receive and respond to e-mails at virtually any hour of the day.  It is particularly difficult for those of us who lack the self-discipline to turn off the electronics.  It is certainly a phenomenon that employers are going to have to watch and determine how to respond in order to keep a quality well-trained workforce. 

Recent Fed discussions had indicated that in 2023 we will likely see a rate increase, which is a slippage from earlier predictions by members of the Fed.  There are also discussions about easing the purchase of securities in an effort to ease longer term interest rates.  The complex discussions were summed up with a jocular comment by Mr. Powell as the effect of we are thinking about, maybe talking about it. This reminded me of Donald Rumsfeld’s famous comment which ended with “unknown unknowns.”

Mr. Biden warned Mr. Putin to get control of Russian hackers or face serious consequences. The prior Administration was cowed by Putin or afraid of what he might share. We have the ability I suspect to disrupt Russia’s electric grid, pipelines, and many other aspects of their economy. It’s time to act.

We are finally pulling out of Afghanistan after 20 years with the anticipated howls from hawks. The country is in chaos which had to be fully anticipated WHENEVER we pulled out. Unfortunately, the history of Afghanistan has led us to this place without any realistic options.

In a surprise, lumber prices dove 40% in June.  The biggest monthly drop on record dating back to 1978.  This is consistent with the general downward trend of more than 18% in 2021.  The cause is in part the result of Americans ceasing renovations and building projects as they begin to spend money on vacations and travel.  This is also potentially a good sign for inflation generally, as it should push downward a major indicator.

Mr. Biden issued a packet of Executive Orders aimed to tackle corporate abusers. The business groups applauding include small business groups and farmers while those opposed include the US Chamber of Commerce and big businesses. This makes an interesting set of players on each side. I’m with the farmers and small business!

A bold headline reads, “Canada, US are easing pandemic border-crossing restrictions”, which is an entirely misleading headline.  The group of people entitled to any benefit are Canadian citizens and permanent residents who have been fully vaccinated.  The only change being the elimination of the 14-day quarantine period, and the same is true for air travel with the 3-day quarantine period being eliminated which by the way this exception never made any sense.  The article goes on the say “restrictions barring all non-essential trips between Canada and the United States, including tourism will remain in place until at least July 21st”.  Big headline, little difference.  Earlier in the week, Mr. Trudeau had announced that until 80% of Canadians were vaccinated, and a mechanism was put in place to verify vaccinations, no substantial lessening of restrictions would occur.  US politicians are calling for the US to unilaterally lessen border restrictions which will allow Canadians in but doesn’t help Americans to travel to Canada.

New rules of origin have been proposed by Customs and Border Protection (CBP) and are open for comment. The new rules if implemented could lessen the burden for many companies importing Chinese goods, then adding substantial modifications resulting in the Country of Origin being Canada or Mexico and thus eligible for lower duties under the USMCA.

Bill Owens is a former member of Congress representing the New York 21st, a partner in Stafford, Owens, Piller, Murnane, Kelleher and Trombley in Plattsburgh, NY and a Strategic Advisor at Dentons to Washington, DC.

The views expressed by commentators are solely those of the authors. They do not necessarily reflect the views of this station or its management.

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