Saturday, December 9, 2017

Penn Loh (YES! Magazine) Capitalism Is Not the Only Choice

I post this piece of hippie anti-capitalism out of personal appreciation for the agonizing nights that petty-bourgeois disillusionment with commodity relations can consume. Not quite the agony of most working class folks for whom disillusionment with commodity relations manifests as desperation with the means of life denied. Cash -- the ultimate and universal commodity -- remains more than ever before, not less, existential, i.e. the means of life, for the overwhelming majority of working people performing occupations other than primitive agriculture. We are bound by commodity relations as never before, not only in our own nation, but  to peoples from all over the world,  to the creators and consumers of the values (services and products ) required for our survival -- and who share the hope of a path to prosperity for billions of souls.  Capitalism, as an economic system, is NOT REALLY A CHOICE. It came into being when a sufficient social surplus, technical base and human capital combined to make it possible for markets -- and production for the purpose of exchange -- to steadily replace and overcome more primitive feudal relations.  To escape capitalism, commodities must be superseded by free or very cheaply provided requirements for life: food, shelter, clothing, education, health care, transportation, etc. Services and intangibles are poor commodities (lousy stores of value) and will no doubt thrive in the absence of commercial markets -- they already do in limited areas (e.g. open source software, non-profits, etc). But the commodity problem can only be partially solved at our present level of culture and technology. Not a few "socialist revolutions" have found that economies cannot be commanded to move beyond what is objectively possible with a given historical context. This is especially true of the division of labor. Ordering farmers to make steel in their backyard out of patriotic enthusiasm does not work. That solution, for now, is social democracy (part socialism, part capitalism) -- but freed of its chief historical defect -- nationalism. Working people all over the world must find the paths of global cooperation and integration that lift all boats. There is no other way. Nature will teach us that -- either benevolently, or harshly -- that part is our choice.

Have a good holiday

John



Capitalism Is Not the Only Choice

We have opportunities every day to build economies that lift each other up and spread joy.




Penn Loh posted Nov 14, 2017

Since the breakup of the Soviet bloc and China's turn toward free markets, many economists have pronounced an "end of history," where capitalism reigns supreme as the ultimate form of economy. Perhaps "there is no alternative" to a globalized neoliberal economy, as former British Prime Minister Margaret Thatcher often said. Indeed, free markets in which individuals compete to get what they can while they can are glorified in popular culture through reality shows such as Shark Tank.

So, are we trapped in capitalism? While many of us may want a new economy where people and planet are prioritized over profit, we remain skeptical that another world is really possible. We make some progress locally but then feel powerless to affect national and global forces. Too often "the economy" is equated with markets where corporations compete to make profits for the wealthiest 1 percent and the rest work for a wage or salary (or don't make money at all). Work itself is seen as legitimate only if it legally generates income. Value is measured only in money terms, based on what people are willing to pay in the market. The capitalist mindset also separates economy from society and nature, as if it exists apart from people, communities, government, and our planet. Economy is its own machine, fueled by profit and competition.But many of us in the 99 percent are not feeling so happy or secure about this economy's results. Many are working harder and longer just to maintain housing and keep food on the table. Even the college-educated are mired in student debt, keeping the American Dream beyond their grasp. And then there are those who have never been served well by this economy. African Americans were liberated from enslavement only to be largely shut out of "free" market opportunities. Immigrants continue to work in the shadows. Women still earn only about three-quarters of what men make for the same work.

When everything that we label "economic" is assumed to be capitalist—transactional and market-driven—then it is no wonder that we run short on imagination.

Redefining economy beyond capitalism

To escape this "capitalocentrism," we need to broaden the definition of economy beyond capitalism. What if, instead, economy is all the ways that we meet our material needs and care for each other? And what if it's not a singular thing? Then we would see that beneath the official capitalist economy are all sorts of thriving non-capitalist economies, where there may not be a profit motive or market exchange. They include tasks that we do every day. We care for our children and elderly; we cook and clean for ourselves and each other; we grow food; we provide emotional support to friends. These are all ways of meeting our material needs and caring for each other.

For many, these economies, which foster solidarity and are rooted in values of democracy and justice rather than maximizing profit, are invisible or not recognized as "economic"; they are merely how we go about our lives. Capitalist thinking blinds us to these economic activities, some of which make survival possible and life meaningful. These non-capitalist ways also add up to a significant portion of all economic activity. Economist Nancy Folbre from University of Massachusetts Amherst estimates that unpaid domestic work (historically considered "women's work") was equal to 26 percent of the U.S. gross domestic product in 2010.

Recognizing these diverse economies allows us to see that there are choices to be made.

Broadening the definition of economy also puts people back into the system and empowers us. Economy is not just something that happens to us, a sea in which we swim or sink. Rather we are all part of multiple economies, some in which we are the main actors—such as our household economies—and others in which we are the extras—such as venture capital markets.

Recognizing these diverse economies and lifting the veil of capitalocentrism allows us to see that there are choices to be made, ethics and values to be considered. For example, I might pay more for lettuce from a local farmer who grows sustainably rather than from a distant supplier that exploits farm workers and uses pesticides. These choices are not only made as consumers, but also as workers, producers, and neighbors, and through policies that set the rules necessary for any economy to function. Do I work for a for-profit owned by shareholders or for a worker-owned cooperative, nonprofit, or B corporation? Should public land be used for luxury condos or for affordable housing? These questions open space for all of us to participate in shaping our world and the economic futures of the 99 percent.

Solidarity is rising

Across the U.S., from Jackson, Mississippi, to Oakland, California; in rural Kentucky and on Navajo-Hopi lands; and throughout Massachusetts' biggest cities, it is often poor communities and communities of color that are building solidarity economies around these questions. This is not new. In fact, this is where solidarity economics—collective strategies for survival—have been innovated out of necessity. Think mutual aid, community organizing, self-help, and cooperatives of all kinds. These practices have been embedded in Black liberation movements, the early labor movement, and many other progressive movements in the U.S.

Old Window Workshop trainee Shaniqua Dobbins carries a window panel from a historic building in downtown Springfield, Massachusetts.

The desire for deep, transformational change—for the multitude of solidarity economies to add up to something—comes not just from those who are dissatisfied, but even more so from communities that are simply struggling to survive. Dreams of a decent life and a fair shake come from those making Black Lives Matter, from immigrant workers making poverty wages, from ex-prisoners locked out of the mainstream economy, from tenants barely able to make rent, and from communities being displaced to make way for the 1 percent.

Springfield is Massachusetts' third-largest city, and here the Wellspring initiative is building a network of worker-owned cooperatives to create local jobs and build wealth for low-income and unemployed residents. Inspired by the Cleveland Evergreen Cooperatives, which has built a network of worker-owned businesses to provide goods and services to the region's anchor institutions, Wellspring was founded in 2011 to try to capture some of the $1.5 billion spent by its own anchor institutions, such as Baystate Health and University of Massachusetts Amherst. One study showed anchors procure less than 10 percent from local businesses.

Solidarity economics is more than just cooperatives. It is a social justice movement.

Its first cooperative, Wellspring Upholstery, was launched in 2013 and now has seven workers. Wellspring Upholstery was the first business to be developed, in part because a successful 25-year-old upholstery training program run by the county prison could provide trained workers. Wellspring's second cooperative is Old Windows Workshop, a women-owned window restoration business. A main goal of this business, according to production manager Nannette Bowie, is to allow "the flexibility of a working mom to take care of your family responsibilities and keep a full-time job."

Wellspring raised almost $1 million to start its third business, a commercial greenhouse, which will produce lettuce, greens, and herbs for the local schools and anchor institutions. Construction began during the summer. With several businesses underway, Wellspring is demonstrating viable models they hope will inspire others and grow the job base and wealth-building opportunities for low-income and unemployed residents.

Wellspring Upholstery Cooperative worker-owners "Joel" Carlos Orria-Fontanez, Evan Cohen, Tina Pepper, Gary Roby, and Jose Serrano in their workshop.

Wellspring is just one example of solidarity economies that are emerging in Massachusetts. In Worcester, the state's second-largest city, the Solidarity and Green Economy Alliance is cultivating their own ecology of more than a dozen cooperatives. Some are matching resident skills to meet community needs, such as landscaping, soil remediation, honey production, and urban agriculture. Others are providing services to movement organizations, such as translation, video production, and bookkeeping. In Boston's Roxbury and Dorchester neighborhoods, a food solidarity economy is emerging, which includes a community land trust, urban farms and a greenhouse, a kitchen incubator, a consumer food co-op, and a worker-owned organics recycling company. And Latinx residents of East Boston have formed the Center for Cooperative Development and Solidarity. Concerned about rapid gentrification, the group began exploring how economic alternatives could help them stay in East Boston. They are supporting startup cooperatives in child care, sewing, and cleaning. The Boston Ujima Project was just officially launched in September to build a community capital fund where a participatory budgeting process is used to make investments in local businesses.

Consciousness, power, and economy

Yet solidarity economics is more than just cooperatives. It is a social justice movement. It is shifting our consciousness not only to uncover root causes, but also to expand our vision of what is possible, and to inspire dreams of the world as it could be. It is building power, not just to resist and reform the injustices and unsustainabilities produced by current systems, but ultimately to control democratically and govern political and economic resources to sustain people and the planet. And it is creating economic alternatives and prototypes for producing, exchanging, consuming, and investing in ways that are more just, sustainable, and democratic.

If we want to transform and go beyond capitalism, then we must confront it in all three of these dimensions: consciousness, power, and economy.

We do not have the luxury of creating solidarity economies in a vacuum. That means that we have to put them into practice now at home and in our own communities, no matter how small the scale. At the same time, we can work with others to build larger solidarity alternatives and do the hard work of reforming the political, economic, and ideological systems that are making life so difficult for so many.

Everyone can put solidarity values into practice—to live in solidarity—starting in whatever ways we can. And that is the transformative power of solidarity economics, that it doesn't have to scale up only by building larger and larger organizations and systems. It can scale up by many people in many places pursuing economics of social justice. It will require taking back government to dismantle the systems that privilege capitalism and to redirect public resources toward solidarity economies. We can all begin by spreading the word, sharing our radical imagination of the world that we want to live in.

--
John Case
Harpers Ferry, WV

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Jobs report: Another strong month as payrolls settle into solid trend, but wage growth still underwhelms [feedly]

Jobs report: Another strong month as payrolls settle into solid trend, but wage growth still underwhelms
http://jaredbernsteinblog.com/jobs-report-another-strong-month-as-payrolls-settle-into-solid-trend-but-wage-growth-still-underwhelms/

The US labor market continues to add jobs at a strong clip, as robust consumer demand is generating a virtuous cycle of job growth, increased weekly hours, wage growth (though see ongoing caveats below), and hiring. Payrolls were up by 228,000 last month, above expectations for about 190,000. The unemployment rate held steady at 4.1 percent, a 17-year low.

Our official monthly jobs smoother filters out some of the noise in the payroll data by taking monthly averages over the last 3, 6, and 12 months. The fact that the bars are all about the same height reveals the underlying trend in job growth to be around 170,000 per month, a healthy pace for this stage of the recovery. As labor markets close in on full employment, job growth slows a bit as workers become more scarce.

However, given the movement of other key variables, namely, wages and prices, the full-employment, full-resource-utilization case cannot yet be made, as I show below.

Once again, hourly wage growth is a sore point. The two figures below show yearly wage growth for all private-sector workers and for the 80% of the workforce that's blue-collar in goods production or non-managerial in services. In both cases, the 6-mos moving average reveal a flattening trend. Basically, in 2015-16, the tightening job market drove wage growth up from 2 to 2.5 percent, around where it has been stuck since. In fact, that's precisely last month's yearly growth rate for all private workers (2.5%). Given the consumer inflation has been running at around 2%, that's but a small hourly wage gain in real terms, and certainly less than I'd expect given a 17-year low in the jobless rate.

 

That said, other series show stronger wage growth, as Dean Baker and I point out here, especially for middle-wage and minority workers, so the jury's not in on the mystery of the missing wage growth. All told, in a series that mashes together 5 different wage series (which I'll post later) we see a mild acceleration, but again, less than would be expected.

Also, hours worked per week ticked up last month and weekly earnings were up 3.1%, the strongest weekly growth rate since early 2011.

One theory is that the job market is pulling less skilled and experienced workers in from the sidelines, and this is holding down wage growth. But the Atlanta Fed tracker, which tries to control for this, doesn't show much acceleration either.

All of this creates a challenging dynamic for the Federal Reserve. The next figure shows how the current unemployment rate of 4.1% is below the rate the Fed's "natural rate," i.e., the lowest jobless rate consistent with stable prices. But neither prices (core PCE, the Fed's preferred gauge), which recently went through a bout of DEcelleration, nor wages, are responding much at all to low unemployment.

Are there, then, measures of labor demand that do not show a fully tight labor market? In fact, labor economists consider the employment-to-population ratio of prime-age (25-54) workers is a quick proxy for this question. This rate fell from about 80% before the last recession to 75% at its trough. It's now at 79% so it has clawed back about three-quarters of its losses. In other words, it's possible that the labor force still has some room-to-run and that labor demand, as strong as it is, still hasn't exhausted labor supply.

Turning to sectors, manufacturing had a strong month, picking up 31,000 factory jobs last month. So far this year, manufacturing employment is up an average of 16,000 per month, compared to about zero last year. That's partly due to stronger growth abroad pulling in more of our exports, but the dollar has gained strength of late, and that could dent these gains going forward, as the stronger dollar makes our exports more expensive relative to imports.

Retail trade stores added about 19,000, which is the biggest gain for the sector in a year. The strong job market could help the sector as the holiday season gets underway, but brick and mortar stores are of course in heated competition with online sellers. (Note: these data are adjusted for seasonal hiring effects, so any gains reflect jobs added above the usual seasonal pattern.)

Surely, some politician will say something foolish about how the solid November report reflects the tax cut that's working its way through the Congress. If I could, I'd issue fines for such statements ($1.5 trillion sounds about right). As the smoother graph shows, we're right on a trend that's been ongoing for years now. As noted, there's real momentum in the economy, with job gains, if not much in real hourly wage gains, boosting household incomes.

The challenge for policy makers, especially at the Fed, is to not get spooked by the strong quantity numbers (jobs) when the "price" measures–wages and inflation–are not flashing red at all.


 -- via my feedly newsfeed

America’s Broken Political System: Fresh at Project Syndicate [feedly]

America's Broken Political System: Fresh at Project Syndicate
http://www.bradford-delong.com/2017/12/americas-broken-political-system-fresh-at-project-syndicate.html

Project SyndicateAmerica's Broken Political System: Whether or not the tax bill survives the conference process and becomes law, the big news won't change: the Anglo-Saxon model of representative government is in serious trouble. And there is no solution in sight. For some 400 years, the Anglo-Saxon governance model–exemplified by the republican semi-principality of the Netherlands, the constitutional monarchy of the United Kingdom, and the constitutional republic of the United States of America–was widely regarded as having hit the sweet spot of liberty, security, and prosperity. The greater the divergence from that model, historical experience seemed to confirm, the higher the likelihood of repression, insecurity, and poverty. So countries were frequently and strongly advised to emulate those institutions.

Nobody would dare offer that same advice today... Read MOAR at Project Syndicate


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Friday, December 8, 2017

NYTimes: After 7 Years of Job Growth, Room for More, or Danger Ahead?

After 7 Years of Job Growth, Room for More, or Danger Ahead? https://nyti.ms/2BOtA2D

In the Battle against Fake News, the Bots may be Winning [feedly]

In the Battle against Fake News, the Bots may be Winning
http://www.globalpolicyjournal.com/blog/07/12/2017/battle-against-fake-news-bots-may-be-winning

In the Battle against Fake News, the Bots may be Winning

Andrea Stroppa - 7th December 2017

Andrea Stroppa on the state of the ongoing struggle agaisnt fake news.

Lawyers from top tech companies were recently asked about the role their firms played in the 2016 United States presidential election, during three Congress hearings.

Propaganda, disinformation and misinformation messages on Facebook and Instagram reached approximately 146 million American citizens – almost half the population – Facebook revealed in a prepared testimony.

Twitter accounts linked to Russia "generated approximately 1.4 million automated, election-related tweets, which collectively received approximately 288 million impressions" between September 1 to November 15 2016, according to company executives.

These revelations echo my own research during November 2016. The then Republican candidate Donald Trump's Instagram account was amassing a good deal of followers, but significant tranches of them were bots and Russians – even if there was no clear evidence of direct involvement by the Russian government.

Hatred, confusion and disarray

These figures give rise to many urgent questions, such as whether these social media activities influenced the outcome of the election. In a wider context, consider how the use of social media tools has changed since their inception. The same media that gained traction by promoting freedom and democracy around the world – during the 2011 Arab Spring, for example – now seem ideal tools to manipulate opinions and spread hatred, confusion and disarray. Public perception of social media has shifted accordingly in recent months.

US law-makers, academics and tech experts are pressuring Facebook, Twitter and Google to prevent such digital propaganda and disinformation campaigns, and rightly so. But there are two significant issues. Firstly, from a technical standpoint, it is difficult to stop these "botnets" – the large number of fake accounts run by specific software which swamp user newsfeeds and timelines with fake news or deceptive posts.

Secondly, the value of social networks such as Facebook, Instagram and Twitter is based on the volume of their active users. Therefore, the primary and constant goal of these tech companies is to expand their user base. (This is why Facebook is so eager to enter the Chinese market.)

These networks want to give access to those living under repressive governments who censor the internet. So they enable techniques which circumvent national surveillance systems, such as proxy, VPN and others.

This makes life very easy for botnet creators, who are developing sophisticated software to imitate real users. For example, in order to bypass the phone verification typically required by social media platforms, botnet owners use virtual phone numbers and private IP proxies. Also, thanks to the work of some tech experts who reverse-engineer apps to find out how their deepest processes work, these 'smart' bots are quickly able to evade any security system. Such operations are cheap to run and available to any organisation or government.

How to spot a bot

Particularly on Facebook, these propaganda or disinformation campaigns run on pages either professing support for a social cause or simply offering generic entertainment news. How are users to decipher a genuine page from a fake one? Does this power lie only with Facebook engineers?

A potential answer may be the appearance of the post, such as its format and featured links. By applying data analysis and open-source intelligence, experts could have understood in advance what was actually happening. Facebook could simply have used common sense when accepting Russian rubles for sponsored, politically motivated posts.

On a technical level, the digital propaganda strategies in question mostly rely on botnets and exploiting online communities, using paid content and sharing to disseminate material. In response, social media companies are planning new measures to better manage paid content on their platforms.

An upcoming bipartisan bill is focused on tightening rules for political advertising. However, as respected tech journalists such as Anthony de Rosa have noted, the real problem is that people continue to share links, posts and spam on Facebook pages with a high number of followers.

Dangers of digital propaganda

This is a problem which independent research projects could help with, if the internet giants were only willing to share their internal data. In recent years, it is independent researchers who have shed light on previously unknown issues affecting social media users, such as software bugs, counterfeit item trafficking, phishing campaigns and malware dissemination.

More generally, we are also facing a cultural problem. Broadsheet newspapers, research papers, government inquiries, Congressional hearings, and tech companies have all underscored the dangers of digital propaganda in recent weeks. But some public sources still tend to minimise or dismiss this phenomenon.

Nobody could seriously "believe that a post on FB could ever swing an election", suggested a well-known commentator at the Italian newspaper Corriere della Sera on Twitter recently. Such glib comments miss the point. Digital propaganda strategies take aim at real issues, such as immigration, economic crisis, terrorism and social inequality, in order to push millions of people surreptitiously towards a particular political agenda or viewpoint.

The revelations from the US 2016 election pertain to other countries. Italy, for example, has its own general election coming up. It has 30 million Facebook users, and 35% of its adult population get their daily news from that platform (only 14% still rely on newspapers).

Some organised networks have already launched their social media election strategy to influence voters, using propaganda and fake news campaigns. Media pundits are on high alert for what promises to be another challenging situation worthy of global attention.

 

 

Andrea Stroppa writes about security and technology for the World Economic Forum. this post first appeared on the Agenda blog.

Image Credit: Zen Skillicorn via Flickr (CC BY-ND 2.0)


 -- via my feedly newsfeed

A quick note on CHIP, block grants, and the tax cut [feedly]

A quick note on CHIP, block grants, and the tax cut
http://jaredbernsteinblog.com/a-quick-note-on-chip-block-grants-and-the-tax-cut/

This piece from the WaPo makes an important point, which I'd like to embellish a bit.

A few months ago, Congressional authorization for the CHIP program expired, and they still haven't reauthorized the funding, which is a block grant to states in support of this health coverage program for 9 million low-income kids and pregnant women.

On Friday, Utah posted a notice online saying it probably will run out of CHIP funding by the end of January. Earlier in the week, Colorado notified families that their coverage might end early next year. Arizona, California, Ohio, Minnesota and the District are also nearing the end of their funding, as is Oregon, whose Democratic governor, Kate Brown, has directed the state's health authority to continue financing CHIP through April out of its reserves.

Unlike Medicare, Medicaid, SNAP, and other programs that automatically expand and contract with need, block granted programs depend on Congressional re-authorization. Therein lies one of the problems (I'll get to another below) and the article raises an important concern:

…imagine this same situation, but applied to Medicaid, the program that covers far more Americans — around 70 million.

The reason Congress must reauthorize funding for CHIP is because it's a block grant program, meaning that states are provided with a set amount of federal dollars instead of an ongoing funding stream (as with Medicaid).

Were Congress to convert Medicaid into block grants, as Republicans tried to do in multiple health-care bills this year, it's feasible lawmakers might show the same delay in letting funding lapse, throwing states into uncertainty on an even larger scale.

In other words, what's going on with CHIP is a potent warning against block granting other safety net programs, like Medicaid or SNAP (moreover, we've written that the CHIP block grant is set up to work better than the ones proposed for Medicaid). This is a very well known problem, btw, to those of us who followed the block-granting of TANF (cash payments to poor families). Its funding froze and its anti-poverty and counter-cyclical effectiveness have been hugely diminished.

Here's a new problem in this space. If the Republican tax bill passes, as I suspect it will, and they significantly reduce the state-and-local tax deduction, those states that want to raise the revenues necessary to support block-granted programs will have a much harder time doing so, since their residents can no longer write off most or all of these tax payments against their federal liabilities.

In this regard, Republicans are up to a devious bait-and-switch. They want to convert safety net programs that current respond to need into fixed-funded block grants, while at the same time reducing states' ability to support these programs.


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What’s up with productivity growth and what does it mean? [feedly]

What's up with productivity growth and what does it mean?
http://jaredbernsteinblog.com/whats-up-with-productivity-growth-and-what-does-it-mean/

I'll be brief, because first and foremost, the recent uptick in productivity growth that I'm about to show you may be statistical noise. These are jumpy data. But in case this sticks, I did want to lay down a marker and tout some potential implications.

This morning's revised productivity report has output per hour up a rousing 3 percent in Q3. That's an annualized, quarterly rate, and OTE'ers know I like to filter out some of the noise by looking at year-over-year changes.

So, the table below shows the recent acceleration in year-over-year changes in the key variables.

Since productivity growth equals output minus hours growth, we can decompose the increase. It's all about faster output growth; hours of work have slowed a touch.

Now, there could be a bit of the hurricane season in there, as that hurts employment but boosts (gross) output. Also, as we close in on full employment, employment and hours growth will naturally slow.

What's a bit disconcerting here–with even bigger caveats re data noise in this series; I'm pretty skeptical of this wage result–are the unit labor costs, which measure compensation growth relative to productivity growth. We typically expect pay to rise along with productivity growth, at least at the average (if not so much the median), especially as the job market tightens. And, as Dean Baker and I point out here, you see real wage pressures in some series. But compensation slows of late in this series. And slower compensation amidst faster productivity growth drives down unit labor costs.

That dynamic–productivity rising faster than comp–also drives down labor's share of national income, as the next figure shows (the BLS labor share data is more pessimistic than other series; part of the decline is due to imputations of self-employed earnings, but all measures show a similar trend).

Source: BLS

Towards the end of the figure, if you squint you can maybe see the beginning of a trend reversal around 2015, but the series has since turned down again. It's an unsettling picture of where most income growth has gone in recent decades.

At any rate, if this productivity acceleration sticks, and that's a big "IF," here are some implications:

–The Fed has even less reason to raise rates, as faster productivity growth can pay for non-inflationary wage gains.

–Score one for the full-employment-multiplier theory a number of us like to tout. As the job market tightens, firms must find new efficiencies to maintain profits margins as production costs rise (another reason the wage result above looks fishy to me).

–Get ready for a lot of ridiculous claims that the tax cut and MAGA are responsible for the acceleration.


 -- via my feedly newsfeed