Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Thursday, July 10, 2025

AI Summary. The authors argue US trade deficits persist because foreign investors find US financial assets attractive, but the current deficit level is not sustainable. They estimate that stabilizing the US net foreign liability position requires improving the trade balance by about 2% of GDP, or over 3% if low-cost borrowing privileges are lost.

Tamim Bayoumi and Joseph Gagnon Peterson Institute for International Economics
Date Posted:
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Persistent trade deficits at current levels would push our net international investment position beyond levels sustained in any advanced economy. Stabilization will require an adjustment of at least 2% of GDP, implying real exchange depreciation of ~15–20%.

How much must the US trade balance improve to be sustainable?

Core argument: Setting the US net international investment position on a sustainable path requires a trade balance improvement of about 2% of GDP if the dollar's "exorbitant privilege" is maintained, implying a real effective exchange rate depreciation of some 15–20%.

The most persistent driver of US deficits is the attractiveness of US financial assets to foreign investors owing to the central role of the dollar in international transactions and to the perceived safety and creativity of US financial markets. The US net liability position is likely overstated, [but] the present level of the trade deficit is not likely to be sustainable, as it would push the net international investment position [NIIP] (as a ratio to GDP) beyond levels that have been sustained in any advanced economy. The tariff war may reduce the trade deficit by slowing US growth, depreciating the dollar, [but] puts at risk the ability of the United States to finance external debt at low cost [the “exorbitant privilege”], increasing the burden on future generations. Setting the NIIP on a sustainable path requires a substantial but not unprecedented increase in the US trade balance. If exorbitant privilege is maintained, the adjustment is some 2% of GDP, implying a depreciation in the real effective exchange rate of some 15 to 20%. Were the United States to lose its exorbitant privilege, the adjustment rises to over 3% of GDP, implying a larger depreciation and faster accumulation of debt for the same level of the trade balance.

Takeaways by Macro Roundup® AI

  1. Setting the US net international investment position on a sustainable path requires a trade balance improvement of about 2% of GDP if the dollar's "exorbitant privilege" is maintained, implying a real effective exchange rate depreciation of some 15–20%.
  2. Were the United States to lose its exorbitant privilege, the required adjustment rises to over 3% of GDP, implying a larger depreciation and faster debt accumulation for the same level of the trade balance.
  3. The present US trade deficit is not likely sustainable, as it would push the net international investment position relative to GDP beyond levels sustained in any advanced economy, with the most persistent driver being foreign investors' attraction to US financial assets.

Related Articles:

  • The End of Privilege: A Reexamination of the Net Foreign Asset Position of the United States — The authors document that the U.S. net foreign asset position fell by 60 percentage points of U.S. gross domestic product between 2007 and 2021, even as U.S. current account deficits narrowed. They attribute this to a boom in the market valuation of U.S. corporations' non-financial assets, which mechanically raised the value of large foreign equity holdings in U.S. firms.
  • United States’ Changing Net IIP — The United States' net international investment position deficit—the gap between foreign-owned US assets and US-owned foreign assets—is the largest on record and has turned negative across all major asset categories. Because much of the liability is equity, the author argues rebalancing could come through a correction in US equity values rather than a weaker dollar.
  • Sucking The World Dry (The US Dependence on Foreign Inflows) — The author argues that negative net national savings means the United States is consuming capital rather than accumulating it, largely by selling capital stock to foreigners and spending the proceeds and by not replacing aging capital. With a negative net international investment position, the author contends U.S. spending depends on continued foreign inflows and that potential growth is declining.

AI Summary. Elevated US 30-year government bond yields are not unique: yields in Japan and the UK have risen sharply, and the US trade-weighted yield differential against its main trading partners has been stable, unlike Japan's and the UK's. The author argues this is inconsistent with a building US political risk premium in long-term yields.

Robin Brooks Robin Brooks Substack
Date Posted:
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Database

The rise in long-term Treasury yields likely reflects the global rise in rates rather than a US-specific “Trump risk premium,” Robin Brooks argues, citing the stability of the US trade-weighted yield differential relative to other advanced economies.

Are rising long-term US bond yields a sign of political risk?

Core argument: The US 30-year yield differential versus its main trading partners has been stable this year, which the author argues is inconsistent with a building "Trump risk premium" in long-term yields.

The left chart shows yields on 30-year government bonds for the US (black), the Euro zone (red), Japan (blue), the UK (orange) and Switzerland (pink). For the Euro zone, I construct a GDP-weighted average yield for all countries that issue 30-year debt. This chart already shows that elevated US yields aren’t happening in a vacuum. Yields in many other places - notably Japan and the UK - have been rising sharply, making US yields look well behaved in comparison. The right chart formalizes this. It looks at the trade-weighted yield differential for each country vis-à-vis its main trading partners, where I use trade weights from each central bank’s G10 currency index. The US yield differential is stable so far this year, in contrast to Japan or the UK where it has risen sharply. If a Trump risk premium were building, you’d expect to see the 30-year differential for the US to be rising sharply. That just isn’t the case.

Takeaways by Macro Roundup® AI

  1. The US 30-year yield differential versus its main trading partners has been stable this year, which the author argues is inconsistent with a building "Trump risk premium" in long-term yields.
  2. Thirty-year government bond yields in Japan and the UK have risen sharply, making US long-term yields look well behaved by comparison.
  3. The author constructs a GDP-weighted 30-year yield for Euro zone countries that issue 30-year debt, and trade-weighted yield differentials using trade weights from each central bank's G10 currency index.

Related Articles:

  • Treasury Issuance Growing — US Treasury auction metrics show no current weakness in demand, with stable bid-to-cover ratios and no systematic tailing, even as debt-to-GDP rises, the term premium increases, and the government must refinance $9tn over the next year. The author argues Treasury issuance will keep outgrowing the economy, likely pushing long-term interest rates higher.
  • A Trump Risk Premium in the Dollar — Movements in the trade-weighted US dollar against other major currencies map almost entirely onto changes in forward interest-rate differentials, with the same positive relationship holding across periods despite noisier data. The author argues this leaves no discernible evidence of a separate political risk premium in the dollar.
  • Global Debt Report 2025 — About 60% of fixed-rate government debt in advanced economies maturing by 2027 — roughly $9tn — was issued before the recent interest-rate tightening, with weighted average yields below 2% versus projected 10-year rates near 3.6%, implying refinancing at nearly double the original cost. France, Spain, the UK, and the US face heightened vulnerability, with maturing debt exceeding 15% of GDP.

AI Summary. Americans with more close friends express greater confidence that others behave fairly: 59% of those with no close friends say most people would take advantage of them, versus 29% of those with at least six close friends.

Daniel Cox American Enterprise Institute
Date Posted:

America remains a high-trust society, though Americans with fewer friends report lower trust levels. 79% of Americans with at least 6 friends say strangers would help them if their car broke down, relative to 58% of respondents with no friends.

Do Americans with more close friends trust others more?

Core argument: 59% of Americans with no close friends say most people would try to take advantage of them if given the chance, compared with 29% of Americans reporting at least six close friends.

Americans with more close friends have much higher confidence that people behave fairly in their dealings with others. For instance, nearly six in 10 (59%) Americans with no close friends say that most people would try to take advantage of them if given the chance. Americans with at least six close friends are far less likely to express this view—only 29% say people would try to take this advantage. Most Americans with more close friends believe people generally try to be fair. Similarly, a majority (54%) of Americans with at least six close friends believe that “most of the time people try to help others,” a view shared by only 33% of Americans with no close friends.

Takeaways by Macro Roundup® AI

  1. 59% of Americans with no close friends say most people would try to take advantage of them if given the chance, compared with 29% of Americans reporting at least six close friends.
  2. 54% of Americans with at least six close friends believe that most of the time people try to help others, versus 33% of Americans with no close friends.
  3. Americans with more close friends express higher confidence that people behave fairly in their dealings with others, and most of them believe people generally try to be fair.

Related Articles:

  • Americans’ Trust in One Another — The share of US adults saying "most people can be trusted" fell from 46% in 1972 to 34% in 2018 and stood at 34% in a later survey. Trust is associated with neighborhood characteristics beyond individual demographics, and people who see their neighbors as similar to them racially, politically, and educationally report trusting them more.
  • Zero-Sum Thinking and the Roots of U.S. Political Divides — Zero-sum thinking — viewing gains for one group as losses for another — is associated with greater support for liberal economic policies, stronger alignment with the Democratic Party, and weaker alignment with the Republican Party. The authors also find it linked to believing the QAnon conspiracy theory holds some truth and to sympathy for the attack on the U.S. Capitol.
  • Life Under Two: Debt, Deficits, and the AI Discontinuity — The United States averaged annual GDP growth above 3% for decades, but 2% or less is now more likely. Over ten years, the author estimates that gap amounts to a $3.36tn larger economy, $3.7tn more tax revenue, and 6m more jobs, shifting public psychology from abundance toward scarcity.

AI Summary. Under a deal with the largest U.S. rare earths miner, the Defense Department will take a 15% stake, commit billions of dollars to investment and output purchases, and guarantee a price floor for rare earth minerals and magnets. The agreement calls for a new magnet factory, expected online in 2028, at a scale far exceeding current U.S. magnet production.

Jon Emont Wall Street Journal
Date Posted:

The Defense Department is taking a 15% stake in MP Materials, the US’s largest rare earths miner. In exchange, DoD will guarantee a price floor, protection against the possibility that China will flood the market with minerals, depressing world prices.

Can government stakes and price floors build U.S. rare-earth production?

Core argument: The Defense Department will take a 15% stake in MP Materials, America's largest rare earths miner, and commit billions of dollars to investing in the company and purchasing its output.

MP Materials America’s largest rare earths miner has reached a deal under which the Defense Department will take a 15% stake in the company. The government is committing to spending billions of dollars investing in MP Materials and purchasing its output. The deal calls for MP Materials to build a new factory to make rare-earth magnets at a scale that vastly exceeds current U.S. magnet production. It is expected to come online in 2028. In its deal with MP Materials, the Department of Defense is guaranteeing a price floor for rare earth minerals and magnets. That means the company is protected against a scenario in which China fully withdraws its restrictive export policies and the minerals flood into the market, lowering global prices.

Takeaways by Macro Roundup® AI

  1. The Defense Department will take a 15% stake in MP Materials, America's largest rare earths miner, and commit billions of dollars to investing in the company and purchasing its output.
  2. MP Materials will build a rare-earth magnet factory at a scale that vastly exceeds current U.S. magnet production, expected to come online in 2028.
  3. The Defense Department is guaranteeing a price floor for rare earth minerals and magnets, protecting MP Materials if China fully withdraws its restrictive export policies and the minerals flood the market, lowering global prices.

Related Articles:

  • China’s Weaponisation of Rare Earths is a New Kind of Trade War — China's export controls on rare earth materials and magnets threatened to halt production across the auto industry, the largest manufacturing sector in most advanced economies, and forced Washington to negotiate on tariffs. Despite China's well-known dominance of rare earth production, Western governments and companies have not developed alternative suppliers.
  • China Found World’s Pain Point on Trade – and Will Use It Again — China's export permitting system for rare earths and other critical minerals is detailed enough that Beijing is developing a granular understanding of where every kilogram it produces ends up and why. Bottlenecks emerged as China slowed approvals for magnets containing even minuscule amounts of seven rare earths, alongside limits on sales of the raw elements.
  • China Fast Tracks Rare Earth Export Licences for European Companies — China has agreed to fast-track rare earth export licence approvals for some European companies after its export controls on the critical minerals disrupted global supply chains and slowed deliveries for manufacturers of goods from cars to washing machines. China's commerce minister urged the European Union to facilitate trade in high-tech products to China.

Friday, July 11, 2025

AI Summary. US debt is on an upward trajectory, and the author argues that extraordinary growth, default, money creation, and spending cuts are each implausible or unacceptable, leaving large tax increases. US governments collect about 28% of GDP in taxes versus 35% in the UK and 46% in France, and a value-added tax could close the roughly 4%-of-GDP fiscal gap.

Greg Mankiw Harvard University
Date Posted:

With outsized economic growth and spending cuts unlikely solutions to unsustainable US debt, and rapid money creation and default highly undesirable ones, Mankiw suspects the most likely solution is the US will levy a “broadly shared” VAT = 4% of GDP.

Are large tax increases the only way to stop rising debt?

Core argument: US governments at all levels collect about 28% of GDP in tax revenue, according to 2022 OECD data, compared with 35% in the United Kingdom, 41% in Sweden, 43% in Italy, and 46% in France.

There is no end in sight to increasing US indebtedness. There are five ways to stop this upward trajectory: (1) extraordinary economic growth, (2) government default, (3) large-scale money creation, (4) substantial cuts in government spending, and (5) large tax increases. Each of the first four ways out of this problem seems either implausible or unacceptable. The US is now a low-tax country compared with its peers. According to OECD data (for 2022), governments at all levels in the US collect only about 28% of GDP in tax revenue, compared with 35% in the United Kingdom, 41% in Sweden, 43% in Italy, and 46% in France. To close a fiscal gap of roughly 4% of GDP with only increased tax revenue, the US would need to raise overall tax revenue by about 14%. If a sizable tax increase is inevitable, we must look beyond the top 1% of the income distribution…closing the fiscal gap will require broadly shared sacrifice. Most nations have value-added taxes, and these taxes have shown themselves to be remarkably efficient. [Across advanced countries], VAT revenues average about 7% of GDP, which is more than enough to close the US fiscal gap.

Takeaways by Macro Roundup® AI

  1. US governments at all levels collect about 28% of GDP in tax revenue, according to 2022 OECD data, compared with 35% in the United Kingdom, 41% in Sweden, 43% in Italy, and 46% in France.
  2. Closing a US fiscal gap of roughly 4% of GDP through tax revenue alone would require raising overall tax revenue by about 14%, which the author argues demands broadly shared sacrifice beyond the top 1% of the income distribution.
  3. Value-added taxes raise an average of about 7% of GDP across advanced countries, more than enough to close the US fiscal gap, while extraordinary growth, default, large-scale money creation, and substantial spending cuts appear implausible or unacceptable.

Related Articles:

  • Treasury Issuance Growing — US Treasury auction metrics show no current weakness in demand, with stable bid-to-cover ratios and no systematic tailing, even as debt-to-GDP rises, the term premium increases, and the government must refinance $9tn over the next year. The author argues Treasury issuance will keep outgrowing the economy, likely pushing long-term interest rates higher.
  • Rapidly Growing Treasury Supply Crowding Out Other Types of Credit Growth — Roughly half of all fixed income issuance coming to market over the past year has been US Treasuries, meaning investors must allocate a growing share of dollars to financing the government. The argument is that lower government debt would free up more funds for consumer borrowing and business investment.
  • Larry Summers and Bob Rubin Join Our CIOs to Discuss the Surprising Economic Cycle — Adopting the Simpson-Bowles fiscal consolidation when interest rates were at zero would have risked excessive disinflation, since long rates had no room to fall to provide an offsetting expansionary impulse. After the large run-up in debt and rise in real interest rates, the developing fiscal situation risks inflationary pressure, Treasury market disruption, or crowding out of private investment.

AI Summary. Chinese workers across industries, age groups, and income brackets report fear of layoffs, shrinking wages, and few alternative job options. China's urban unemployment rate was 5%, below the government's 5.5% official target, while joblessness among those aged 16 to 24 excluding students was 14.9%, up from 14.2% a year earlier.

Luna Sun and He Huifeng South China Morning Post
Date Posted:

China’s urban jobless rate was 5% in May. Among 16 to 24–year olds, excluding students, it was 14.9%, up from 14.2%, in May of last year.

Are Chinese workers across industries and incomes worried about losing jobs?

Core argument: China's youth unemployment rate for those aged 16–24, excluding enrolled students, was 14.9% in May, an improvement on April but above the 14.2% recorded in the same month a year earlier.

Anxiety is gripping China’s workforce, with few exceptions among industries, age groups and income brackets. From factory floors to corporate offices, the fear of lay-offs, shrinking wages, and a dearth of alternatives is becoming universal. While the country’s urban jobless rate was 5% in May – under the government’s official target of 5.5% for the year – the rate among those aged 16 to 24 was 14.9% excluding enrolled students. This was an improvement on April’s reading, but significantly higher than the 14.2% reported for the same month last year.

Takeaways by Macro Roundup® AI

  1. China's youth unemployment rate for those aged 16–24, excluding enrolled students, was 14.9% in May, an improvement on April but above the 14.2% recorded in the same month a year earlier.
  2. China's urban jobless rate stood at 5% in May, below the government's official 5.5% target for the year.
  3. Fear of lay-offs, shrinking wages and a dearth of alternative jobs spans China's workforce across industries, age groups and income brackets, from factory floors to corporate offices.

Related Articles:

  • China is Suffering its Own ‘China Shock’ — Academic analysis of 12 labour-intensive Chinese manufacturing industries estimates average employment fell about 14%, or nearly 4mn jobs, between 2011 and 2019, with textile roles down 40%; a further analysis of the same sectors found 3.4mn more jobs lost through 2023. Researchers argue industrial upgrading and automation are cutting demand for lower-skilled workers and depressing their wages.
  • China Already Had a Graduate Jobs Crisis. The Trade War is Making it Worse — China's graduate job market faces multiple simultaneous pressures, including a real estate slump, tighter financial-sector regulation with pay cuts and layoffs, and cautious private-sector hiring. Major state banks have cut graduate recruitment sharply, with Agricultural Bank of China planning 4,530 hires, down 68.9%, and Industrial and Commercial Bank of China down 47%.
  • ‘No Marriage, No Children’ Is China’s Ticking Timebomb — China registered about 6.1m marriages in its most recent year, the lowest since public records began in 1986 and less than half the 2013 peak, with roughly 30% of 30-year-olds unmarried versus 15% a decade earlier. Births of 9.54m were the second-lowest since the People's Republic of China was founded in 1949.

AI Summary. New asylum applications in OECD countries reached 2.7m, above the nearly 1.7m a year lodged during the Syrian refugee crisis, while the share of claims succeeding in the European Union fell from 57% to 42%. Nearly half of applicants come from countries with success rates below 20%.

Economist Staff The Economist
Date Posted:

In 2023 there were 2.7mm asylum claims made in OECD countries, far more than the 1.7mm at the height of the Syrian Civil War. The claimants are largely migrating for economic reasons.

Are rising asylum applications in rich countries increasingly unsuccessful?

Core argument: OECD countries received 2.7m new asylum applications in 2023, exceeding the nearly 1.7m a year lodged during the Syrian refugee crisis of 2015 and 2016.

Claims for asylum in the rich world shot up. In 2023, 2.7m new applications were lodged in OECD countries, more than the nearly 1.7m a year during the Syrian refugee crisis of 2015 and 2016. Many claims are dubious. In the EU, the proportion that succeed has fallen from 57% in 2016 to 42% in 2024. Nearly half of applicants come from countries that have a success rate of below 20%. Twice as many asylum recipients in Britain said they were 17 when they applied as said they were 19, presumably because they think the system is kinder to children.

Takeaways by Macro Roundup® AI

  1. OECD countries received 2.7m new asylum applications in 2023, exceeding the nearly 1.7m a year lodged during the Syrian refugee crisis of 2015 and 2016.
  2. The share of EU asylum claims that succeed fell from 57% in 2016 to 42% in 2024, and nearly half of applicants come from countries with success rates below 20%.
  3. Twice as many asylum recipients in Britain reported being 17 when they applied as reported being 19, presumably because they believe the system treats children more kindly.

Related Articles:

  • America’s Immigration Mess: An Illustrated Guide — Current Population Survey estimates indicate America's foreign-born population surpassed 50m for the first time and exceeded 15% of the national population, above the prior peak of 14.8% recorded in 1890. Mass immigration during that earlier wave was associated in contemporary opinion with widening income and wealth gaps and depressed wages for less-skilled native-born men, and sweeping national restrictions followed.
  • Germany Opened Its Doors to Migrants. Now It’s Struggling to Cope — Germany recorded 6.43m more arrivals than departures over a decade, the largest inflow of any country outside the US, with migrants at 18.8% of the population versus 15.3% in the US. Noncitizens, 15% of the population, accounted for 41% of crimes, up from 28.7%, according to police statistics.
  • Changing Sub-Saharan Africa’s Growth Trajectory — Sub-Saharan Africa's working-age population is growing nearly 3% a year, versus close to zero in much of the world, and is projected to exceed China's within about a decade and reach a quarter of the global total. With modest productivity growth near 2%, the region is likely among the world's fastest-growing.

AI Summary. European cities face more intense, frequent, and longer heat, with hot nights rising fastest, yet air conditioning remains far less common than in the US: London is seeing as many days requiring cooling as Portland, Oregon, where 79% of households have air conditioning. Extreme heat killed an average 83,000 western Europeans annually versus 20,000 North Americans.

John Burn-Murdoch Financial Times
Date Posted:

Between 2000–2019, an average of 83,000 western Europeans lost their lives every year as a result of extreme heat, compared with 20,000 North Americans. Yet due to climate concerns, air conditioning is frowned upon and restricted in the UK and Europe.

Should Europe expand air conditioning as heat deaths outpace North America's?

Core argument: Extreme heat killed an average of 83,000 western Europeans a year between 2000 and 2019, compared with 20,000 North Americans, a disparity the author links to the wide US-Europe gap in air conditioning use.

European cities are enduring more intense heat, more frequently, and for longer periods than just a decade or two ago. Hot nights — where the risks to health are highest, and air conditioning adds the most value — are rising fastest of all. This year London is experiencing as much heat as Portland, Oregon, (18 days and counting of temperatures requiring active cooling), but without Portland’s cooling infrastructure (79% of households there have air conditioning). The results will not be pretty. The wide US-Europe disparity in air conditioning use is becoming reflected in a startlingly wide disparity in heat-related deaths. Between 2000 and 2019, an average of 83,000 western Europeans lost their lives every year as a result of extreme heat, compared with 20,000 North Americans.

Takeaways by Macro Roundup® AI

  1. Extreme heat killed an average of 83,000 western Europeans a year between 2000 and 2019, compared with 20,000 North Americans, a disparity the author links to the wide US-Europe gap in air conditioning use.
  2. London has recorded 18 days and counting of temperatures requiring active cooling this year, as much heat as Portland, Oregon, where 79% of households have air conditioning.
  3. European cities are facing more intense, more frequent, and longer-lasting heat than a decade or two ago, with hot nights — when health risks are highest and air conditioning adds the most value — rising fastest.

Related Articles:

  • Air Conditioning To Be Major Driver Of Electricity Demand, Says IEA — The International Energy Agency projects home air conditioning will require an extra 697 terawatt hours of electricity by 2030 — more than 3x the added demand from computer data centres — with electric vehicles needing an extra 854 terawatt hours. The agency attributes the rise to higher incomes in the developing world and higher temperatures from climate change.
  • The Future of Cooling — Over half of the world's 1.6bn air conditioners are in just two countries, China with 570m units and the United States with 375m, and nearly 70% of all units globally are in residential buildings. Household ownership ranges from about 4% in India and under 10% in Europe to over 90% in the United States and Japan.
  • Heliocentrism — An energy use must be electrified before green grid electricity can decarbonize it, and while US grid decarbonization continues at a steady pace, the electricity share of final US energy consumption has grown little. Transmission line growth runs well below Department of Energy targets for 2030 and 2035, and transformer delivery times have stretched from 4–6 weeks to 2–3 years.

AI Summary. Australia, Japan, and the United States signed an agreement to boost logistical interoperability among their forces, letting their navies refuel, reload missile systems, repair ships, and share maintenance data, including flexible refueling at sea. Indo-Pacific militaries depend on sea and air transport for supplies, while fixed seaports and airports can be difficult to defend from attack.

Rurika Imahashi Nikkei Asia
Date Posted:

Australia, Japan, and the US agreed to increase “logistical interoperability” among their naval forces, including reloading missile systems, refueling at sea, repairing ships, and sharing data on maintenance.

Can shared naval logistics strengthen allied military resilience in the Indo-Pacific?

Core argument: Australia, Japan and the U.S. signed an agreement to boost logistical interoperability among their defense forces, allowing their navies to refuel, reload equipment, repair ships more smoothly and share maintenance data.

The defense forces of Australia, Japan and the U.S. signed an agreement on Friday to boost logistical interoperability between their forces, allowing their navies to refuel, reload equipment, repair ships more smoothly, and to share data on maintenance. The agreement entails cooperation in reloading missile systems as well as flexible refueling, including at sea. These forms of cooperation present logistical benefits as nations in the Indo-Pacific region depend on transportation by sea or air for their military supplies, although fixed seaports and airports can be difficult to defend from potential attack.

Takeaways by Macro Roundup® AI

  1. Australia, Japan and the U.S. signed an agreement to boost logistical interoperability among their defense forces, allowing their navies to refuel, reload equipment, repair ships more smoothly and share maintenance data.
  2. The Australia-Japan-U.S. agreement covers cooperation in reloading missile systems and flexible refueling, including at sea.
  3. Indo-Pacific nations depend on sea or air transportation for military supplies, while fixed seaports and airports can be difficult to defend from potential attack.

Related Articles:

  • Ship Wars — Shipyards tied to China's defense industrial base account for 15% of the country's active shipyards but 40% of commercial output by tonnage, with over 75% of their production built for firms outside China and Hong Kong. The authors argue these commercial revenues offset fixed costs and effectively subsidize China's naval expansion.
  • U.S. Seeks To ‘Integrate’ Japan Into Defense Industrial Base — The U.S. and Japan are formalizing arrangements for U.S. Navy warships to undergo maintenance, repair, and overhaul at Japanese private shipyards, initially limited to the roughly two dozen ships forward-deployed to Japan. Expanding the work to U.S.-based ships, which could ease American maintenance bottlenecks, may require congressional action.
  • How South Korea’s Shipyards Could Save the US Navy — US shipyards had just five commercial ships under construction compared with 1,749 in China, and China's naval fleet is projected to grow from 370 to 475 vessels in a decade versus 297 to between 305 and 317 for the US Navy, whose major shipbuilding programs are behind schedule.