Edward Conard

Top Ten New York Times Bestselling Author

  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “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 represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “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
  • “…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 fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Monday, January 5, 2026

AI Summary. Venezuela accounts for barely 0.1% of world output and produces about 1m barrels of oil a day, roughly 1% of global supply and the 18th-largest producer, down from about 1% of global output and 8% of oil supply in the 1970s. Analysts argue even alarming scenarios there would have minimal global economic impact.

John Authers Bloomberg
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The American raid on Caracas had little impact on financial markets, as Venezuela is already a “basket case.” Real GDP has declined 70% under the Chavez/Maduro regime.

Does a small oil producer's turmoil matter to the global economy?

Core argument: Venezuela accounts for barely 0.1% of world GDP and produces about 1 mbpd of oil, or 1% of global supply, down from roughly 1% of global GDP and 3.5 mbpd (8% of supply) in the 1970s, according to Neil Shearing of Capital Economics.

The main reason markets should be able to take this in stride is, sadly, that Venezuela doesn’t matter much at present, even though it boasts huge reserves of oil. Neil Shearing of Capital Economics sets this out succinctly, "Venezuela’s global economic importance has diminished significantly over the past 50 years. In the 1970s, it accounted for roughly 1% of global GDP and produced around 3.5 million barrels per day (mbpd) of oil, or 8% of global supply. Today, it represents barely 0.1% of world GDP and produces about 1 mbpd, or just 1% of the global total, making it only the 18th-largest oil producer worldwide." Due to worsening mismanagement, the Chavez and Maduro regimes turned steady decline into an all-out crisis that led to hyperinflation and a 70% fall in real gross domestic product. Venezuelan migrants swamped neighboring countries and the US. The tragic bottom line is that even the most alarming scenarios for Venezuela over the next few months would have a minimal impact on the global economy. It was a basket case; nobody expected any growth from it anyway.

Takeaways by Macro Roundup® AI

  1. Venezuela accounts for barely 0.1% of world GDP and produces about 1 mbpd of oil, or 1% of global supply, down from roughly 1% of global GDP and 3.5 mbpd (8% of supply) in the 1970s, according to Neil Shearing of Capital Economics.
  2. Venezuela ranks as only the 18th-largest oil producer worldwide, and even the most alarming scenarios there over the next few months would have minimal impact on the global economy.
  3. Mismanagement under the Chavez and Maduro regimes produced hyperinflation and a 70% fall in real GDP, with Venezuelan migrants swamping neighboring countries and the US.

Related Articles:

  • Latin America’s Perpetual Growth Crisis — Per capita GDP in the US grew a cumulative 20% over a decade, about 2% a year, outpacing Latin American economies; Colombia, Peru and Chile fared best in the region but still fell well short, while Mexico and Brazil underperformed. The author argues Ecuador's and Argentina's dollar pegs preclude growth.

AI Summary. Wage growth is slowing more for lower-paid workers than for higher earners, limiting those households' ability to keep spending, while hiring is concentrated in select industries such as healthcare and among larger firms as small private firms shed workers. Layoffs remain low, but the number of workers unemployed for 27 weeks or more has only rarely been higher.

Tom Porcelli et. al. Wells Fargo
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1.9mm American workers have been out of work for at least half a year. Long-term unemployment at this level is an outlier, as it’s generally seen late in a recession or in its aftermath.

Is the labor market slowdown hitting lower-paid workers hardest?

Core argument: Wage growth for lower-paid workers is slowing more than for higher earners, limiting the ability of these households to keep spending.

The job market moderation isn't even. Lower-paid workers are seeing wage growth slow more than higher-earning peers, which is limiting the ability for these households to keep spending. While hiring has been disproportionately supported by select industries this year, like healthcare, it's also being driven by larger firms. Small private firms are outright shedding workers. Layoffs remain low, but it's getting increasingly challenging to find a new job for those who find themselves out of work. In fact, the number of workers who are unemployed for 27 weeks or more has only rarely been higher.

Takeaways by Macro Roundup® AI

  1. Wage growth for lower-paid workers is slowing more than for higher earners, limiting the ability of these households to keep spending.
  2. Hiring has been disproportionately supported by select industries such as healthcare and by larger firms, while small private firms are shedding workers.
  3. Layoffs remain low, but finding a new job has grown increasingly challenging, and the number of workers unemployed for 27 weeks or more has only rarely been higher.

Related Articles:

  • U.S. Wages Still Rising Briskly, Employment Holding Up, and Inflation Still Sticky (Probably) — The U.S. job market looks no less healthy than a few months earlier: the rise in unemployment to 4.56% has coincided with more people actively looking for work, while the share of Americans aged 25-54 with a job held near 80.6%. Wages rising about 4% a year can explain inflation running about 1 percentage point above pre-pandemic rates.
  • The Economic Divide Between Big and Small Companies Is Growing — High inflation, more cautious consumers, and tariffs are weighing on small-business earnings and prompting cutbacks, as smaller firms are less able than larger ones to withstand economic headwinds. Private firms with fewer than 50 workers have steadily shed jobs over the past six months.
  • Jobless Growth — Labor demand growth may be too weak to keep pace with even modest labor supply growth: the labor market is somewhat weaker than before the pandemic, job growth has turned negative outside healthcare, and firms are focused on using AI to cut labor costs. Economists estimate most employment losses in routine manual occupations since the 1970s occurred during recessions.

AI Summary. China's high saving and diminishing returns on investment leave consumption weak, and its currency's real trade-weighted value has fallen substantially, giving Chinese exporters a large competitive advantage. The author argues the government sets the yuan's value and now suppresses it largely through state banks buying dollars, purchases that do not appear in official reserves.

Paul Krugman Krugman Wonks Out
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China’s saving remains high, but its investment has slowed. Instead of boosting consumption, the government exports excess saving via proactive depreciation of the yuan. The real effective exchange rate has dropped 11% (19% relative to trend) since 2021.

How does weak domestic consumption translate into an exporter advantage?

Core argument: China's real effective exchange rate has fallen substantially since 2021, and the yuan is even weaker relative to trend than the raw depreciation data suggest, giving Chinese companies a large competitive advantage.

China’s saving remains very high, but its investment is running into diminishing returns in the face of slowing technological progress and a shrinking working-age population. Yet the Chinese government keeps failing to take effective steps to reduce savings and increase consumer demand. But exports and imports are the consequence of decisions at the level of companies and individuals. So how does China’s underconsumption problem translate into incentives for exporters and importers? China’s real effective exchange rate has fallen substantially — the yuan has “depreciated” — since 2021. But this understates the yuan’s true level of weakness. The yuan is even weaker relative to trend than its raw depreciation data would suggest. This gives Chinese companies a large competitive advantage. And the value of the yuan is basically set by the Chinese government. The manipulation of the yuan by the Chinese government is unique. Nothing similar occurs with other major currencies. These days the Chinese government manipulates its currency largely by having state banks rather than the government proper buy dollars. These purchases don’t show up in official reserves, so doing it this way hides the extent of the weak-yuan policy from casual observers.

Takeaways by Macro Roundup® AI

  1. China's real effective exchange rate has fallen substantially since 2021, and the yuan is even weaker relative to trend than the raw depreciation data suggest, giving Chinese companies a large competitive advantage.
  2. The value of the yuan is basically set by the Chinese government, which manipulates it largely by having state banks rather than the government proper buy dollars, keeping those purchases out of official reserves and hiding the weak-yuan policy from casual observers.
  3. Chinese saving remains very high while investment runs into diminishing returns amid slowing technological progress and a shrinking working-age population, and the Chinese government keeps failing to take effective steps to reduce savings and raise consumer demand.

Related Articles:

  • China’s Trade Surplus, Part I — China's very high investment rates, combined with a shrinking workforce and slowing productivity, produce sharply diminishing returns, making its decades-old high-savings, high-investment growth model unsustainable. The author argues China's leaders resist a pivot toward consumption because of ideology and geopolitical ambition, with the leadership rejecting welfare spending as breeding dependency.
  • Why China Is Doubling Down On Its Export-Led Growth Model — China's share of global exports has risen to 15% from about 13% in 2017 and is projected to reach 16.5% by 2030, according to a Morgan Stanley study. Producer prices have fallen every month for more than three years as supply outstrips domestic demand, with goods export volumes up 43% since early 2020 versus 15% for imports.
  • China’s Economy: Rightsizing 2025, Looking Ahead to 2026 — The authors argue China's official growth figures are inconsistent with ten consecutive quarters of deflation, estimating that real GDP is around 11% below official levels, with most of the adjustment in investment. That would imply a drop of roughly 9 percentage points in China's share of global investment, helping explain its export surge.

AI Summary. The International Monetary Fund projects sub-Saharan African growth of about 4.4%, aided by a weak dollar that eases debt-service and inflation pressure and by high commodity prices, while Asia's combined economies slow to around 4.1%. With over 2 percentage points from population growth, that pace falls short of the roughly 7% needed for Asian-style transformation.

David Pilling Financial Times
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The IMF projects sub-Saharan Africa will grow at 4.4% in 2026, overtaking Asia. Per capita growth, however, will be 2 to 3% – far short of the more than 7% necessary to “replicate Asian-style transformation.”

Is African growth fast enough to match Asian-style transformation?

Core argument: Sub-Saharan Africa is expected to have mustered growth of about 4.1% in 2025 despite war in Sudan, insurgency in the Sahel and coups in Madagascar and Guinea Bissau, and the IMF expects that to rise to 4.4%.

In 2025, despite war in Sudan, insurgency in the Sahel and coups in Madagascar and Guinea Bissau, sub-Saharan Africa is expected to have mustered growth of about 4.1%. The IMF expects this to notch up to 4.4% as economies continue to reap the benefits of a weak dollar — good for cutting debt-service payments and easing inflationary pressure — and of high commodity prices, including for gold and copper. At the same time, the IMF is predicting that, as the Chinese motor whirrs more slowly, the combined economies of Asia will slow in 2026 to around 4.1%. [African] growth of 4 or 5% is not much to brag about. More than 2% of that can be explained by population expansion, leaving just 2-3% for per capita growth — which is not enough to replicate Asian-style transformation. Sustained growth of at least 7% is required for that. By 2050, more than one in four people will be African. The continent will have a larger working-age population than China and India combined. If Africa is not on a better trajectory, we will all know about it.

Takeaways by Macro Roundup® AI

  1. Sub-Saharan Africa is expected to have mustered growth of about 4.1% in 2025 despite war in Sudan, insurgency in the Sahel and coups in Madagascar and Guinea Bissau, and the IMF expects that to rise to 4.4%.
  2. African economies continue to reap the benefits of a weak dollar, which cuts debt-service payments and eases inflationary pressure, and of high commodity prices including gold and copper, while the IMF predicts Asia's combined economies will slow to around 4.1% in 2026 as China decelerates.
  3. More than 2% of Africa's 4-5% growth can be explained by population expansion, leaving just 2-3% for per capita growth, short of the sustained 7% required to replicate Asian-style transformation, even as the continent's working-age population is set to exceed China's and India's combined by 2050.

Related Articles:

  • 21st-Century Africa Governance and Growth — Sub-Saharan Africa's GDP per capita has fallen relative to the world average over three decades, from 30% to 22%, reflecting the region's inability to sustain growth. Had it grown at the global pace since 1990, income per capita would be over 40% higher; at emerging East Asia's pace, nearly 3x higher.
  • 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.
  • Exploring the Implications of Sub-Saharan Africa’s Demographic Explosion — Sub-Saharan Africa is projected to hold a quarter of the world's working-age population within a few decades and to surpass China's working-age population in roughly a decade. Even with modest productivity growth near 2%, the region's growth is estimated at 4.5–5.5%, raising its share of global output from about 3% while remaining small.

AI Summary. The authors find that a minority of entrepreneurs are "transformative" — generating disproportionate productivity gains, scoring high on IQ tests, being well-educated, and hiring research and development workers. They argue that economies with more such entrepreneurs and R&D workers sustain higher long-run productivity growth.

Ufuk Akcigit, Harun Alp, Jeremy Pearce, and Marta Prato Federal Reserve Bank of New York
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Danish data show that the propensity to become an R&D worker or a “transformative entrepreneur” who pursues innovation is highly correlated with IQ. Productivity growth is driven by the “symbiotic relationship” between such entrepreneurs and R&D workers.

Which entrepreneurs drive disproportionate productivity gains?

Core argument: A distinct minority of entrepreneurs are "transformative" — those hiring at least one R&D worker — and the authors find these founders generate disproportionate productivity gains while tending to have high IQ scores and strong education.

We study who becomes an entrepreneur, along with their hiring and business decisions, and find that a distinct minority are “transformative.” These individuals, who generate disproportionate productivity gains, tend to have high IQ scores, be well-educated, and hire technical (R&D) workers. We identify entrepreneurs as individuals who register as primary founders of firms with at least one employee. Among this group, we distinguish transformative entrepreneurs, those who hire at least one R&D worker, from non-transformative entrepreneurs, who do not employ technical personnel. R&D workers are defined as individuals employed in occupations with high patenting intensity, reflecting their direct involvement in innovation-related activities. The shares of entrepreneurs and R&D workers vary across IQ deciles. The pattern is reversed across the two groups: individuals with higher IQs are more likely to be R&D workers, but less likely to be entrepreneurs. The data support the idea of productivity growth being driven by the symbiotic relationship between transformative entrepreneurs and R&D workers. For policymakers, the lesson is that when an economy has more R&D workers and transformative entrepreneurs, they sustain higher long-run productivity growth.

Takeaways by Macro Roundup® AI

  1. A distinct minority of entrepreneurs are "transformative" — those hiring at least one R&D worker — and the authors find these founders generate disproportionate productivity gains while tending to have high IQ scores and strong education.
  2. Across IQ deciles the pattern reverses between the two groups: individuals with higher IQs are more likely to be R&D workers but less likely to be entrepreneurs, with entrepreneurs identified as primary founders of firms with at least one employee.
  3. The authors conclude that economies with more R&D workers and transformative entrepreneurs sustain higher long-run productivity growth, which they attribute to the symbiotic relationship between the two groups.

Related Articles:

  • Transformative and Subsistence Entrepreneurs: Origins and Impacts on Economic Growth — Only 17% of firms are "transformative" entrepreneurs, defined as those hiring a research-and-development worker at some point; higher IQ and educational attainment strongly predict transformative entrepreneurship, though the likelihood of becoming an entrepreneur overall declines with IQ. The authors argue education subsidies address financial constraints more effectively than uniform startup or research subsidies.
  • The Economics of Inequality in High-Wage Economies — Information technology created investment opportunities exceeding the supply of properly trained talent, while trade with low-wage economies, low-skilled immigration, trade deficits, and aging demographics eased constraints on low-skilled labor and risk-averse savings. The author argues this framework, rather than rising cronyism, explains high returns to success, slowing productivity growth, and low interest rates.
  • The Extreme Shortage of High IQ Workers — Semiconductor manufacturing requires workers of above-average intelligence, with the most demanding roles needing IQs in the top 1 in 1,000 — a pool of about 164,000 people in the US, of whom perhaps 100,000 can be placed in such professions. The author argues this scarcity explains reliance on high-IQ workers abroad and on smarter tools and non-human intelligence.

AI Summary. US drone makers are held back by scale: China's DJI is estimated to sell more than half the world's cheap first-person-view drones, giving China leadership in key components, since specialized chips are only worth developing if costs can be spread across many units. A 25% US tariff prompted DJI to shift US-bound production to Malaysia.

Chris Miller Financial Times
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Citing favorably the FCC’s recent ban on foreign-made drones and key components, Chris Miller argues “targeted import restrictions could look more attractive than blanket tariffs” as a path to incubating an American drone industry.

Does scale limit US drone makers against Chinese competition?

Core argument: China's DJI is estimated to sell more than half the world's cheap first-person view drones, and China also leads in producing many key drone components.

The problem that US drone companies face is scale. China’s DJI is estimated to sell more than half the world’s cheap, first-person view drones. Because of this, China is also the leader in producing many key drone components. This provides major advantages. Companies can only justify developing specialised chips and other hardware if they can amortise the cost over many units sold. China’s market dominance has made it impossible for foreign companies to compete. During the first Trump administration, the US tried to address this by imposing a 25% tariff on imported Chinese drones. DJI quickly pivoted its production base for US sales to Malaysia. In 2024, Malaysia exported three times as many drones by value to the US as China did.

Takeaways by Macro Roundup® AI

  1. China's DJI is estimated to sell more than half the world's cheap first-person view drones, and China also leads in producing many key drone components.
  2. Developing specialised chips and other drone hardware is only justifiable when the cost can be amortised over many units sold, and China's market dominance has made it impossible for foreign companies to compete.
  3. After the first Trump administration imposed a 25% tariff on imported Chinese drones, DJI shifted its production base for US sales to Malaysia, which in 2024 exported three times as many drones by value to the US as China did.

Related Articles:

  • America’s Fight Back Against China Starts In Los Angeles—In Flip-Flops — El Segundo, California has developed a self-reinforcing entrepreneurial cluster of defense and hardware startups founded by former employees of SpaceX, Palantir and Anduril who cashed in stock options to launch their own firms. One of them, drone maker Neros, says it has America's highest drone production rate and has worked to remove Chinese technology, including circuit boards, from its products.
  • Why Every Country Needs To Master The Electric Tech Stack — Drones are the foundation of hard power in the early 21st century, so a country unable to produce them domestically is at a disadvantage. As electric motors overtake combustion engines as the core technology that makes machines move, the same supply chains and production processes used for electronics can also produce cars, drones, robots, and appliances.
  • Drones Are Key to Winning Wars Now. The U.S. Makes Hardly Any — China's DJI accounts for about 70% of commercial drones sold globally, and industry experts estimate its output far exceeds that of any other manufacturer, with capacity in the millions of drones a year. About 500 US companies manufacture drones, producing fewer than 100,000 annually, according to an industry association.

Tuesday, January 6, 2026

AI Summary. US industrial employment has fallen by 65,000 over the past year and is down 123,000 from its early-2025 peak, with manufacturing and transportation accounting for most losses and construction job gains slowing to 52,000 from 191,000 the prior year. The author attributes the decline to tariffs raising input costs, immigration enforcement hitting construction, and cuts to industrial policy subsidies.

Joseph Politano Apricitas Economics
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US blue-collar employment has fallen by 123k jobs, ½ of them in manufacturing, since early 2025 – likely an underestimate, as preliminary estimates of upcoming annual data revisions suggest 100k less jobs in manufacturing and 30k in construction.

Why is US industrial employment falling across blue-collar sectors?

Core argument: US industrial employment fell 65k over the last year, reversing 2024's addition of 250k jobs, with employment across trades and industry now down 123k from its early-2025 peak and declining nearly every month since February.

The US is down 65k industrial jobs over the last year, a dramatic reversal from 2024, when it added a lower-than-usual but still respectable 250k jobs. A major slowdown has hit all blue-collar sectors this year, though manufacturing and transportation are driving the vast majority of US job losses. Employment across trades and industry is now down 123k from the all-time peak reached in early 2025 and has been declining nearly every month since February - [likely an underestimate], as preliminary estimates for upcoming annual jobs data revisions suggest an additional loss of 100k manufacturing jobs and 30k construction jobs. Construction added 52k jobs over the last 12 months, compared to 191k the 12 months prior. Chipmaking jobs rose dramatically from 2021-2022 amidst rising prices, the global semiconductor shortage, and the passage of the CHIPS Act, but have already slid all the way back to early 2021 levels, [despite] the AI boom. Tariffs are hurting blue-collar employment by raising the costs of manufacturing inputs. Immigration raids are disproportionately hurting the construction sector. Cuts to industrial policy subsidies have helped push factory construction down more than 8% over the last year. The administration’s desired “blue-collar boom” is not happening; quite the opposite.

Takeaways by Macro Roundup® AI

  1. US industrial employment fell 65k over the last year, reversing 2024's addition of 250k jobs, with employment across trades and industry now down 123k from its early-2025 peak and declining nearly every month since February.
  2. Preliminary estimates for upcoming annual jobs data revisions suggest an additional loss of 100k manufacturing jobs and 30k construction jobs, while construction added 52k jobs over the last 12 months versus 191k the 12 months prior.
  3. Chipmaking employment, which rose sharply in 2021–2022 amid the global semiconductor shortage and the CHIPS Act, has slid back to early-2021 levels, and factory construction is down more than 8% over the last year amid cuts to industrial policy subsidies.

Related Articles:

  • U.S. Wages Still Rising Briskly, Employment Holding Up, and Inflation Still Sticky (Probably) — The U.S. job market looks no less healthy than a few months earlier: the rise in unemployment to 4.56% has coincided with more people actively looking for work, while the share of Americans aged 25-54 with a job held near 80.6%. Wages rising about 4% a year can explain inflation running about 1 percentage point above pre-pandemic rates.
  • Jobless Growth — Labor demand growth may be too weak to keep pace with even modest labor supply growth: the labor market is somewhat weaker than before the pandemic, job growth has turned negative outside healthcare, and firms are focused on using AI to cut labor costs. Economists estimate most employment losses in routine manual occupations since the 1970s occurred during recessions.
  • Our Favorite Charts of 2025 — Wage growth is slowing more for lower-paid workers than for higher earners, limiting those households' ability to keep spending, while hiring is concentrated in select industries such as healthcare and among larger firms as small private firms shed workers. Layoffs remain low, but the number of workers unemployed for 27 weeks or more has only rarely been higher.

AI Summary. Analyses showing a shrinking middle class typically use relative income thresholds that rise with median income, so they can register decline even when living standards rise across the distribution. Using an absolute definition, the authors find the core middle class shrank because the upper-middle class grew from 10% of families to 31%, doubling its income share.

Stephen Rose and Scott Winship American Enterprise Institute
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An absolute measure (2.5 to 5x the poverty line) shows that the share of American families in the middle class fell from 35% to 31% btw 1979 and 2024, as middle-class families moved into the upper-middle class, whose share rose from 10% to 31%.

Is the middle class shrinking because families moved up?

Core argument: Under an absolute definition of the middle class, the upper-middle class grew from 10% of families in 1979 to 31% in 2024 and doubled its share of income, so the "core" middle class shrank because families moved up.

Analyses of the middle class that use “relative” entry and exit points that increase as median income rises can show that fewer people qualify as middle class or better. But such findings rely on a relative definition of the middle class, such that if income doubles for every family, the middle class does not grow, and are consistent with living standards rising significantly across the income distribution—just somewhat less so lower down. The “lower-income” group in Pew’s analyses expanded over time, but it ended up 55% richer nonetheless. The reason it expanded was because the middle-income group got 60% richer. Using an absolute definition of the middle class, we find that the “core” middle class has shrunk, but only because more families have become upper-middle class over time. The upper-middle class boomed from 10% of families in 1979 to 31% in 2024, and its share of income doubled. The share of families whose income left them short of the core middle class fell from 54% to 35%.

Takeaways by Macro Roundup® AI

  1. Under an absolute definition of the middle class, the upper-middle class grew from 10% of families in 1979 to 31% in 2024 and doubled its share of income, so the "core" middle class shrank because families moved up.
  2. The share of families whose income left them short of the core middle class fell from 54% to 35%, while Pew's "lower-income" group expanded yet ended up 55% richer.
  3. Relative definitions of the middle class, whose entry and exit points rise with median income, show no growth even if every family's income doubles; Pew's lower-income group expanded because the middle-income group got 60% richer.

Related Articles:

  • Affordability, Part IV — US incomes at the 60th percentile of the distribution, currently $106,000, have fallen from 43% of incomes at the 95th percentile, currently $336,000, to 31% over roughly half a century. The author argues this widening gap may make an affluent lifestyle seem unattainable to most Americans.
  • Income Mobility of the Top One Percent — Using tax-return income, the authors estimate that a third of people in the top 1% drop out within a year and two-thirds within a decade, with three-quarters of the top 0.1% exiting over a decade. Measuring income over two decades rather than one year lowers top 1% income shares by an average of 15%, and top 0.001% shares by 40%.
  • The State of the American Middle Class — US households in every income tier had higher inflation-adjusted incomes in 2022 than in 1970, with median income rising 55% for lower-income households, 60% for middle-class households, and 78% for upper-income households. The gap widened: upper-income median income was 7.3x that of lower-income households, up from 6.3x.

AI Summary. Thirty US states have set minimum wages above the federal minimum of $7.25 an hour, with increases coming from inflation-pegged adjustments, new laws or ballot measures in both Democratic- and Republican-controlled states. More workers now live in states with minimums of $15 or higher than in states at $7.25.

Jared Mitovich Wall Street Journal
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8.3 million workers across 19 states will be impacted this year by minimum wage increases due to inflation adjustments, legislative increases, or ballot measures.

Are state minimum wages rising above the federal minimum nationwide?

Core argument: Thirty states have set minimum wages above the federal floor of $7.25 an hour, with increases this year in both Democratic- and Republican-controlled states.

Workers in a mix of Democratic- and Republican-controlled states will see higher hourly pay this year because of automatic inflation-pegged adjustments, new laws or ballot measures. Thirty states have now set a higher minimum wage than the federal minimum of $7.25 an hour. For the first time, more workers now live in states that pay $15 or higher per hour than those that have kept the $7.25 minimum.

Takeaways by Macro Roundup® AI

  1. Thirty states have set minimum wages above the federal floor of $7.25 an hour, with increases this year in both Democratic- and Republican-controlled states.
  2. For the first time, more workers live in states with minimum wages of $15 or higher than in states that have kept the $7.25 federal minimum.
  3. The higher hourly pay stems from automatic inflation-pegged adjustments, new laws and ballot measures.

Related Articles:

  • Did California’s Fast Food Minimum Wage Reduce Employment? — The authors estimate that California's $20 fast food minimum wage, up from $16, raised fast food sector wages roughly 8% relative to the rest of the country while employment fell about 2.7% relative to fast food employment elsewhere in the US. Their median estimate implies 18,000 fewer California fast food jobs than otherwise.
  • Do Minimum Wages Reduce Job Opportunities for Blacks? — The authors find evidence that higher minimum wages reduce employment among low-skill Black workers across every group examined — teens, high school dropouts, and young workers with at most a high school education — with larger effects for Black males, while such effects are not very detectable for whites.
  • “Compensate the Losers?” Economic Policy and Partisan Realignment in the US — The authors argue that partisan realignment by education reflects Democrats' declining supply of "predistribution" policies such as job guarantees, higher minimum wages, protectionism, and stronger unions, which less-educated Americans favor while more-educated Americans prefer taxes and transfers. They estimate changing views of the parties' economic policies explain roughly half the shift.

AI Summary. Petroleum supplies 90% of US transport energy consumption and about 33% of industrial production, mainly high-temperature heat and feedstocks, with passenger cars, SUVs and light trucks accounting for roughly 60% of transport energy use. The oil intensity of GDP is gradually declining in most of the world, though the US retains the highest oil intensity among major economies.

Michael Cembalest J.P. Morgan
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The oil intensity of US GDP declined 52% btw 1990 and 2024, but remains almost twice that of Germany and France. As of 2023, 90% of energy consumption for American transport and 33% for industrial production was petroleum-based.

How reliant is the US economy on petroleum?

Core argument: Petroleum supplies 90% of US transport energy consumption and about 33% of industrial production, mostly high-temperature heat and industrial feedstocks, while accounting for less than 10% of residential and commercial heating totals.

The US is still highly reliant on petroleum for 90% of transport energy consumption with the remainder mostly made up of natural gas and biomass, and for ~33% of industrial production (mostly high temperature heat and industrial feedstocks). The amounts of oil used for residential and commercial heating is pretty negligible, less than 10% of the respective totals. Note: passenger cars, SUVs and light trucks represent around ~60% of transport energy consumption, with the remainder mostly split between heavy class 8 trucks, air travel and maritime. The oil intensity of GDP is gradually declining in most of the world. At some point, this ratio may drop low enough that disruptions in oil supplies will be less of an issue for growth and consumer spending. I just have no idea what that level would be. Also: the US still has the highest oil intensity of GDP of countries in the chart. The September 2025 expiration of US EV subsidies makes it unlikely that the US will converge further to the rest of the group; Ford throwing in the towel on the F150 Lightning is another sign of the times in the US regarding electrification of transport.

Takeaways by Macro Roundup® AI

  1. Petroleum supplies 90% of US transport energy consumption and about 33% of industrial production, mostly high-temperature heat and industrial feedstocks, while accounting for less than 10% of residential and commercial heating totals.
  2. Passenger cars, SUVs and light trucks account for roughly 60% of US transport energy consumption, with the remainder split mostly between heavy class 8 trucks, air travel and maritime.
  3. The US has the highest oil intensity of GDP among the countries charted, and the September 2025 expiration of US EV subsidies makes further convergence toward the rest of the group unlikely.

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  • 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.
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AI Summary. Venezuela's self-reported crude oil reserves tripled from about 100bn barrels to 300bn barrels after heavy oil in the Orinoco Belt was reclassified as "proved," rather than through any large new discovery or production increase. Much of that oil is extra-heavy, with low recovery rates and high production costs.

Torsten Sløk Apollo
Date Posted:

The tripling of Venezuela’s self-reported crude oil reserves in the late 2000s was due not to new discoveries but to the reclassification of Orinoco Belt heavy oil as “proved.” Slok notes this oil is extra-heavy and has a low recovery rate.

Did reclassification, not discovery, triple Venezuela's reported oil reserves?

Core argument: Venezuela's self-reported crude oil reserves tripled from roughly 100 billion barrels in the early 2000s to 300 billion barrels in the late 2000s, driven by reclassifying Orinoco Belt heavy oil as "proved.".

Venezuela’s self-reported crude oil reserves tripled from around 100 billion barrels in the early 2000s to 300 billion barrels in the late 2000s due to the reclassification of Orinoco Belt heavy oil as “proved.” Much of the oil is extra-heavy, which has low recovery and a high cost to produce. There was no large new discovery or production increase to justify a tripling of reserves through exploration alone.

Takeaways by Macro Roundup® AI

  1. Venezuela's self-reported crude oil reserves tripled from roughly 100 billion barrels in the early 2000s to 300 billion barrels in the late 2000s, driven by reclassifying Orinoco Belt heavy oil as "proved.".
  2. Much of Venezuela's reported oil is extra-heavy crude, which carries low recovery and high production costs.
  3. No large new discovery or production increase accompanied the tripling of Venezuela's reported reserves, which exploration alone does not justify.

Related Articles:

  • Why Markets Can Sit Out the Drama in Venezuela — Venezuela accounts for barely 0.1% of world output and produces about 1m barrels of oil a day, roughly 1% of global supply and the 18th-largest producer, down from about 1% of global output and 8% of oil supply in the 1970s. Analysts argue even alarming scenarios there would have minimal global economic impact.
  • Latin America’s Perpetual Growth Crisis — Per capita GDP in the US grew a cumulative 20% over a decade, about 2% a year, outpacing Latin American economies; Colombia, Peru and Chile fared best in the region but still fell well short, while Mexico and Brazil underperformed. The author argues Ecuador's and Argentina's dollar pegs preclude growth.

AI Summary. A record 62m Americans used marijuana in a single year, 17m of them daily or near daily, while half of American men now hold sports-betting accounts, up from almost zero seven years earlier. The author argues vice and addiction undermine citizens' capacity for free action, justifying state regulation beyond individual-harm criteria.

Charles Fain Lehman National Affairs
Date Posted:
Is Database:
Database

Lehman makes the case for restricting sports gambling, marijuana, and pornography. The costs of vice and its regulation are not limited to individual harm. “Vice, and addiction per se, threatens our capacity to act as fully capable humans and citizens.”

Should the state regulate vice beyond individual harm?

Core argument: A record 62 million Americans smoked marijuana in 2023, with 17 million using it daily or near daily, while one in 12 young adults used a hallucinogen and one in 18 misused prescription stimulants such as Adderall.

In 2023, a record 62 million Americans smoked pot; 17 million now use it daily or near daily. One in 12 young adults used a hallucinogen; one in 18 misused prescription stimulants such as Adderall. Another 2.6 million Americans over 12 took meth. Overdoses still claim the lives of 70,000 Americans annually; the majority died using synthetic opioids like fentanyl. Half of American men have a sports-betting account, up from almost zero seven years ago. "iGaming" — gambling via casino apps on your phone — is now legal in seven states. By some estimates, pornography now generates more revenue than Hollywood, and OnlyFans creators collectively make more than players in the National Basketball Association. If both vice and its regulation can be evaluated only in terms of individual harm, our approach to the question of whether vice should be regulated becomes far too narrow and constricted. Vice, and addiction per se, threatens our capacity to act as fully capable humans and citizens. Vice, and those who peddle it, suppress our freedom — tyrannize us — in a way that the state has a legitimate interest in counteracting.

Takeaways by Macro Roundup® AI

  1. A record 62 million Americans smoked marijuana in 2023, with 17 million using it daily or near daily, while one in 12 young adults used a hallucinogen and one in 18 misused prescription stimulants such as Adderall.
  2. Overdoses claim 70,000 American lives annually, the majority from synthetic opioids like fentanyl, and 2.6 million Americans over 12 took methamphetamine.
  3. Half of American men hold a sports-betting account, up from almost zero seven years earlier, "iGaming" through casino phone apps is legal in seven states, and by some estimates pornography now generates more revenue than Hollywood.

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  • As America’s Marijuana Use Grows, So Do the Harms — An analysis of federal survey data estimates that about 18m US adults — nearly a third of adult cannabis users — report symptoms of cannabis use disorder, with roughly 3m considered addicted. Among those aged 18 to 25, the cannabis use disorder rate of 16.6% matches the alcohol use disorder rate of 15.1%.