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Defying the Odds

Defying the Odds
New book about the 2016 election.

Tuesday, January 29, 2019

Policy Failures

As a result of reduced economic activity, CBO estimates, real (that is, inflation adjusted) gross domestic product (GDP) in the fourth quarter of 2018 was reduced by $3 billion (in 2019 dollars) in relation to what it would have been otherwise. (Such references are in calendar years or quarters unless this report specifies otherwise.) In the first quarter of 2019, the level of real GDP is estimated to be $8 billion lower than it would have been—an effect reflecting both the five-week partial shutdown and the resumption in economic activity once funding resumed.
From the National Association of Business Economists:
 “After a year of robust capital spending, business investment has cooled a bit, and expectations for the next three months slackened similarly,” added NABE President Kevin Swift, CBE, chief economist, American Chemistry Council. “Indeed, the capex story is really a tale of two cities. Fewer firms increased capital spending compared to the October survey responses, but the cutback appeared to be concentrated more in structures than in information and communication technology investments. “A large majority of respondents—84%—indicate that one year after its passage, the 2017 Tax Cuts and Jobs Act has not caused their firms to change hiring or investment plans,” continued Swift.
From the Energy Information Administration:
 EIA estimates that total 2018 U.S. coal production was 755 million short tons (MMst), 20 MMst less than in 2017 and 36% less than in the previous decade. In 2018, coal prices rose in three of the five major coal-producing regions, particularly the Northern and Central Appalachian regions. Although U.S. coal exports increased by about 10 MMst in 2018, volumes were not great enough to offset the decline in U.S. coal consumption, resulting in declining coal production
U.S. coal production and weekly spot steam coal prices