Episode 40: Mexico
Winter weather ravaged much of the US this week, causing power outages, water shortages, flight cancellations, and business closure. According to the National Weather Service, 70% of the continental US was covered in snow. Sadly, this week’s extreme cold weather has caused the deaths of over 50 people across the country.
Texas recorded temperatures not seen in 100 years, and all 254 of the Lone Star state’s counties were under a winter storm warning at the same time. Most electricity has been restored in Texas after outages left 4 million customers without power during a week of below-freezing temperatures. Although power plants are back online, there are still around 280,000 people without electricity, in part due to downed power lines. Approximately 13 million Texans have had their water supply disrupted in recent days. State officials suggested people boil their water because power cuts forced treatment plants to temporarily shut down, which could have allowed bacteria in the water. The obvious problem being it’s hard to boil water without power. Texans are also facing food shortages as many stores are closed due to power cuts and lack of workers.
The humanitarian award goes to Senator Ted “Cancun” Cruz, who, after experiencing a power outage at his home, flew with his entire family to Cancun, Mexico, to stay at the Ritz Carlton. Cruz returned to Texas after public outrage, and he apologized for the poor judgment. It’s unfathomable that a politician elected to represent the people would fly to Mexico for vacation during a weather disaster when so many of his constituents are suffering. It’s a terrible look for Cruz, and this incident will likely haunt his political future.
One big question that has circled Texas all week is how such a large and vital power grid could fail? In 1935, President Franklin D. Roosevelt signed the Federal Power Act, which charged the Federal Power Commission with overseeing interstate electricity sales. Texas wanted to avoid federal rules and taxation, so they created their own grid. There are three power grids in the lower 48 states: the Eastern Interconnection (the area from the Great Plains states eastward to the Atlantic Coast), the Western Interconnection (the area west of the Rocky Mountains and the Great Plains to the Pacific Ocean), and Texas, functioning predominantly independently of one another with limited exchanges of power between them. By not crossing state lines, Texas utilities avoided federal rules and taxes. Self-reliance was also made easier in Texas, especially in the early days, because the state has substantial coal, natural gas, and oil resources of its own to fuel power plants.
There is a downside to going it alone. Texas residents found themselves facing rolling blackouts as the statewide grid struggled to meet demand amid a significant shortfall in generating capacity. The shortfalls were widespread, affecting everything from wind turbines to nuclear plants. One source of trouble may be increased competition for natural gas, commonly used for heating in the United States. An ERCOT director told Bloomberg that problems were widespread across generating sources, including coal, natural gas, and even nuclear plants. Authorities will probably need several weeks, if not longer, to fully understand how so much generating capacity was taken offline at what turned out to be a period of critical demand.
IMPEACHMENT TRIAL
Former President Donald Trump avoided an impeachment conviction for a second time. However, Trump’s legal woes are just getting started. Perhaps the most amusing part of the impeachment trial was watching Trump’s defense attorney, Michael Van der Veen, get bent out of shape at the drop of a hat. This post-trial interview with CBS is just one example. Senate Minority Leader Mitch McConnell and most Republicans voted to acquit Trump. (It’s interesting to note that of the seven Republicans who voted to convict, only one—Lisa Murkowski of Alaska—faces re-election in the next year.) Contrary to his impeachment vote, Mitch McConnell gave a scathing speech after the acquittal condemning Trump and his actions that led to the insurrection. As expected, Trump responded, calling McConnell a ‘dour, sullen, and unsmiling political hack’ and that’ The Republican Party can never again be respected or strong with political leaders like Sen. Mitch McConnell at its helm.”
How much did the Impeachment trial cost taxpayers? The answer is unclear. (The cost of Trump’s current defense could not be confirmed but won’t be paid by tax dollars. By November 2020, the Republican Party spent $225,000 to Jay Sekulow and Jane Raskin’s law firms since 2017. ) The first impeachment trial in January 2020 cost between $1.8 - $3.0 million, including the salaries of lawmakers and 106 congressional staffers, and six lawyers. According to CNN, the impeachment investigation and trial of President Bill Clinton cost taxpayers $80 million in 1994. The first Trump impeachment trial was much longer than the second—the Senate debated the case for over two weeks in 2020, but only five days this go around. However, the more considerable cost to taxpayers is the heightened security around the Capitol in light of the January 6th attack with a price tag of over $500 million.
It’s unclear where this leaves the Republican Party. According to Senator Lindsey Graham, Lara Trump is the future of the Republican Party. In the last four years, Republicans have lost the Presidency and both chambers of Congress. Trump continues to cast a dark shadow over the party. Roughly 70 percent of Republican voters continue to support Trump, polls suggest. According to Vox, a similar percentage say they would be less likely to vote for a Republican senator who voted to convict Trump. And, of course, demographic patterns do not bode well for the party of Lincoln. Still, Republicans have figured out how to succeed on policy with minority support. Meanwhile, Democrats have failed to enact many of their biggest priorities—climate change, Medicare, min wage, gun control, immigration, and more.
COVID
According to new research from Israel, the coronavirus vaccine developed by Pfizer may provide strong immunity after only one dose. The study showed that a single dose of the vaccine is 85% effective in preventing symptomatic cases of COVID up to a month after vaccination. It’s unclear if immunity from a single dose persists after one month. Still, it poses the possibility of delaying the second shot longer than 21 days to get more people vaccinated sooner. The study also found that the Pfizer vaccine can be stored in temperatures found in a consumer freezer.
The inclement weather has put a dent in COVID vaccine distribution, with 40 states reporting delays. As of today, the government has delivered 73 million doses, with 57 million administered. There are 42.7 million people (12.9% of the population) who have received at least one vaccine dose. The country is now giving about 1.7 million shots per day. An appropriate goal, experts say, is three million shots per day — probably by April. At that pace, half of the adults would receive their first shot by April, and all adults who wanted a shot could receive one by June.
President Biden did a townhall with CNN suggesting that for schools to reopen safely, teachers should be considered front-line workers. He said that most elementary schools would be open five days a week by the end of April but indicated that it might take longer to reopen high schools due to higher contagion levels among older students. He also suggested that some schools stay open during the summer to make up for the lost time. In a heavy dose of reality, President Biden said he hoped the US would be back to normal by Christmas with “significantly fewer people having to be socially distanced, and having to wear a mask.”
ECONOMY
Jobless claims rose to 861,000, their highest level in four weeks. US retail sales surged in January 5.3% (vs a forecast of 1.1%), the largest gain in seven months, as households received additional pandemic relief money from the government’s $900 billion stimulus program in December. Receipts at electronics/ appliance and furniture stores popped 14.7% and 12.0% respectively. Sales at clothing stores jumped 5.0%, and spending at restaurants and bars soared 6.9%. Still, sales at restaurants and bars were down 16.6% compared to January 2020.
Further gains in sales are expected in the months ahead with President Biden’s $1.9 trillion stimulus package passage, combined with more vaccinations and a reopening of the economy. Americans are sitting on $2.38 trillion in savings, which could unleash pent-up demand for services like air travel and hotel accommodation. One lurking concern is inflation. The Labor Department said its producer price index for final demand jumped 1.3% last month, the biggest gain since December 2009. That followed a 0.3% rise in December.
The Wall Street firm, Goldman Sachs, unveiled Marcus Invest. This low-cost digital platform allocates and automatically rebalances individuals’ wealth across portfolios of stocks and bonds based on the firm’s investment models. Marcus Invest will integrate into the existing Marcus consumer-banking app and website. The only reason this is “news” is you used to need at least $10 million in investible assets to draw the attention of wealth managers at Goldman. Now, all it takes is $1,000 and a smartphone. Marcus Invest is designed for more mainstream investors. Goldman’s high-touch private wealth advisers charge clients annual advisory fees that can exceed 1% of the balances of its smallest accounts, but for Marcus Invest’s digital advisory services, customers pay 0.35%. Marcus Invest is launching when everyday investors’ interest in the stock market is at a high point. Unlike services such as Robinhood or Webull Financial, Marcus Invest doesn’t let users buy and sell individual stocks (for now).
OTHER NEWS
South Carolina Governor Henry McMaster signed a law this week banning almost all abortions. Planned Parenthood sued the state, arguing that the ban is unconstitutional. The new law is one of the most restrictive abortion bans and coined the “fetal heartbeat” law. It bans abortion after a fetal heartbeat is detected, often at six weeks and before a woman realizes she is pregnant. A fetus viable outside the womb, usually at 24 weeks, is widely considered the United States threshold to prohibit abortion.
NASA’s most sophisticated rover yet, Perseverance (aka “Percy”), landed on Mars. It’s the US’s fifth rover mission to Mars and the 9th landing on the red planet. The 7-month trip covered 300 million miles before landing in Jezero Crater, an ancient lake and river delta. Scientists believe that if life ever flourished on Mars, it would have happened 3 billion to 4 billion years ago when water still flowed in this area. Percy is a car-size, plutonium-powered vehicle that weighs more than one ton and features a 7-foot arm that can drill down and collect rock samples searching for organic molecules and potential signs of microbial life. It will also provide the first recordings of sound on Mars. The rover also contains a four-pound helicopter named “Ingenuity” to assist in the research. Three to four dozen samples will be collected and sealed in tubes and set aside to be retrieved by another rover and brought back to Earth by a future rocket ship around 2030. Mars is popular this travel season. The US landing marks the third visit to Mars in less than two weeks. Two spacecraft from the UAE and China orbited Mars last week. All three missions launched in July to take advantage of the close alignment of Earth and Mars.
The US officially reentered the Paris climate agreement, reversing one of former President Trump’s decisions. The Paris agreement maintains a long-term goal of keeping global average temperatures below 2 degrees Celsius (3.6 degrees Fahrenheit) above pre-industrial levels. The average world temperature is currently 1.2 degrees Celsius above pre-industrial levels.
Mardi Gras was on Tuesday. Mardi Gras is French for Fat Tuesday. It’s also called Shrove Tuesday, Carnival Tuesday, or Pancake Tuesday, depending on the celebration’s location. It marks the last day of the Carnival Season, basically six weeks of partying before the Christian fasting season of Lent, which began on Ash Wednesday.
I. Below are the articles I found interesting the past week:
For better health during the pandemic, is two hours outdoors the new 10,000 steps?
“What’s the Point?” Young people’s despair deepens as COVID crisis drags on
Bill Gates has a master plan for battling climate change
Why do COVID death rates differ wildly from place to place?
II. Stats that made me go WOW!
- According to the World Health Organization, some 2.5 billion of the world’s 7 billion people are without access to improved sanitation, which means more people have access to mobile phones—6 billion—than toilets.
- People are significantly more likely to report good health and well-being when they spent 120 minutes or more in nature a week. The good vibe peaked at 200 to 300 minutes a week. Anything less than two hours didn’t make a difference. (The average adult spent 11 and a half hours a day consuming media in 2019, according to Nielsen. In 2019, half of 18- to 29-year-olds surveyed by the Pew Research Center said they were online almost constantly.)
- In the US, a quarter of 18-24-year-olds said they had seriously considered suicide. In France, a survey of 70,000 students found that 10% had experienced suicidal thoughts during the first months of the pandemic, and more than a quarter had suffered from depression.
- Bitcoin (BTC) is now valued at $54,729, an astonishing figure since we “celebrated” the digital currency breaking the $20,000 mark in December 2020. The first bitcoin exchanged-traded fund in North American launched yesterday in Toronto on the Ontario Securities Commission, with investors exchanging $165 million worth of shares.
- Teslas accounted for 79% of all-electric vehicles registered in the US last year. Americans registered 200,691 Teslas in 2020, a 16% YoY increase. Tesla owns four of the top five electric car models: 1) Model-3, 2) Model-Y, 3) Chevrolet Bolt EV, 4) Model-X, 5) Model-S. Tesla leapfrogged Audi and finished fourth in total registrations amongst luxury vehicles behind Mercedes, BMW, and Lexus.
- The CDC recorded 165 flu-related hospitalizations since October. During the 2019–2020 flu season, about 400,000 people were hospitalized with the flu, and 22,000 people died. The mild flu season has benefitted from measures like masks and social distancing. It helps too that, last year, a record number of people got a flu shot.
III. Name that Tune!
As I write this email, I am listening to “Mexico” by James Taylor.
James Vernon Taylor is an American singer-songwriter and guitarist who is a five-time Grammy Award winner. Taylor is one of the best-selling music artists of all time, having sold more than 100 million records worldwide. Taylor’s music influences include Harry Belafonte, Nina Simone, and Judy Garland. Taylor was the first artist signed to the Beatles label, Apple. They used to record in the same London studio, and, according to Taylor, he was a “bad influence” on John Lennon, sharing his taste for heroin and other opiates. Taylor would leave London and go to rehab before moving to Laurel Canyon in Los Angeles. In LA, Taylor would refine his sound with a blend of country, bluegrass, and folk.
James was married three times, including once to singer Carly Simon. He has four children. James battled heroin addiction and has been clean since 1983 but confesses that his recovery is an ongoing process. Taylor has played for the Obamas and the Clintons and appeared on stage with the pop star, Taylor Swift, who is named after him. President Obama presented Taylor with the presidential medal of freedom award in 2015. Paul McCartney inducted Taylor into the Rock and Roll Hall of Fame in 2000.
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