One of the best side effects of the Trump presidency has been the hostility of the so-called “deep state” or “intelligence community” directed at the president.
This, in turn, has led many Americans to realize that America’s powerful, un-elected secret police agencies serve an agenda all their own. Consequently, polls show one’s views of the CIA and the FBI depend largely on one’s ideological bent. Polls from Fox News and NBC news in recent years show that as various government bureaucracies have ratcheted up their hostility to Trump, more Democrats and Hillary Clinton voters have said they trust the CIA and the FBI.
Why the president and this deep state should be at odds has never been obvious to casual observers. Last month, however, in an article titled “Trump’s War on the ‘Deep State’ Turns Against Him,” the New York Times at last explained that there is indeed very real enmity between Trump and agencies such as the CIA and the FBI. The Times contends that Trump “went to war with the professional staff” of the intelligence agencies and the State Department.
The Times notes Trump has condemned “deep state bureaucrats,” and claims Trump’s “hostility toward government was strong from the start. He blamed the leak of the so-called Steele dossier of unverified allegations against him on intelligence agencies and never trusted their conclusion that Russia intervened in the 2016 election on his behalf.”
Trump was right to be defensive, of course. But that controversy over Russia was never really about what the Russians were up to. The focus was always largely about how much Trump colluded with the Russians to win the 2016 election.
Ultimately, the evidence was so non-existent, that after a nearly-three-year investigation, Robert Mueller was unable to establish evidence of collusion between Trump and the Russians. As Glenn Greenwald has noted: “not a single American — whether with the Trump campaign or otherwise — was charged or indicted on the core question of whether there was any conspiracy or coordination with Russia over the election.”
But this lack of evidence did not stop John Brennan, for example, from claiming for months that he had special secret knowledge of the matter, and that Trump — or at least many around him — were going to be indicted for colluding with the Russians.
Although Brennan is a “former” CIA director, he nonetheless clearly remains well ensconced within the world of his fellow spooks. He is, as ABC News correspondent Terry Moran put it, “cloaked with CIA authority.” Brennan even insisted that he ought to retain his security clearance, presumably forever, even though he is accountable to no one. Such is the mindset of the deep state bureaucrat. They live in a world where they deserve special privileges just for being government employees.
Moreover, Brennan has been joined in his attacks on the president by other former high-ranking members of the deep state, including former FBI chief James Comey and former Director of National Intelligence James Clapper.
Those currently employed by the deep state have joined the anti-Trump campaign as well. Much of the current campaign against Trump is being orchestrated by CIA agents, and according to Sen. Rand Paul on Wednesday, CIA analyst Eric Ciaramella is supplying much of the prosecution’s information. Alexander Vindman, an Army officer and bureaucrat with the National Security Council, has testified to Congress in order to fuel impeachment efforts against the president as well.
Fêting Deep-State Bureaucrats as Heroes
None of this is to say the Trump administration lacks any taint of corruption. Like all presidents, it is likely the Trump administration expects favors for favors. The only thing different about Trump is he is not skilled at keeping the everyday corruption of the White House a secret.
But what is especially problematic for him is the fact that so many of his critics coming out of the bureaucratic woodwork are from intelligence agencies and from the military.
Unfortunately, in the United States there is a well-established bias in favor of employees from national security agencies. Even the very language used by the media speaks to this favoritism. In the Times piece, for example, the authors speak of one of Trump’s critics, one “William B. Taylor Jr., a military officer and diplomat who has served his country for 50 years.” Note the implied selflessness of Taylor’s work. An equally accurate description of Taylor would be “he was employed by government agencies for fifty years” or “the taxpayers paid his bills for fifty years.” Instead, we’re told he “served his country.” The propaganda value of the media’s pro-military bias is not lost on the officers themselves, and it’s no surprise Vindman, a Lt. Colonel, testified to Congress in his military uniform.
Other examples can be found every time Trump fires a lifelong bureaucrat from the upper echelons of the various “national security” agencies. For example, last summer, when Trump fired director of national intelligence Dan Coats, the Atlantic portrayed Coats as a principled idealist who “spoke truth to power.” Coats was fired, the author tells us, because of his devotion to the truth, even if it undermined Trump’s agenda. The best proof of Coats’s honest determination, we’re told, was the fact he “won praise from former intelligence officials.”
[RELATED: “19th-Century Americans Didn’t ‘Support the Troops‘” by Ryan McMaken]
In real life, of course, Coats is a lifelong politician and bureaucrat who prior to his dismissal had collected a government paycheck for four decades. As a politician he lobbied for gun control and supported the disastrous 2003 Iraq War. The idea that his post-Congressional career was marked by dogged devotion to the truth ought to strike one as rather fanciful.
A Slipping Facade
But even the New York Times is no longer pretending that the deep state doesn’t exist, and that it doesn’t have its own political agenda. In fact, as noted by Robert Merry at the American Conservative, the Times article even “portray[s] the current impeachment drama as the likely denouement of a struggle between the outsider Trump and the insider administrative forces of government.” This is especially significant since it is also increasingly clear that, “American foreign policy has become the almost exclusive domain of unelected bureaucrats impervious to the views of elected officials — even presidents — who may harbor outlooks different from their own.” Merry concludes the past three years of investigations of the president, conducted by government bureaucrats, is “the story of entrenched government bureaucrats and a president who sought to curb their power. Or, put another way, the story of a president who sought to rein in the deep state … that sought to destroy his presidency.”
Some of these deep-state agents even admit their willingness to subvert the official chain of command to suit their own purposes. Vindman, for example, told the impeachment committee he actively sought to subvert Trump administration relations with the Ukrainian government largely to preserve Vindman’s own vision for American policy. In the mind of this mid-level bureaucrat, American foreign policy is set not by elected officials in Washington DC, but by the bureaucrats themselves.
Why Take the Administration’s Side?
Back in 2017, the battle lines between Trump and the deep state were already being drawn, and at the time I wrote:
This isn’t to say that Trump is the “good guy” here. As with the US military establishment overall, the deep state is by no means monolithic. Like any group of self-serving institutions, there are competing factions. Trump clearly has allies within some areas of the deep state, as can be reflected in Trump’s attempts to massively expand military spending at the expense of the taxpayer.
But the fact he’s considered an outsider in Washington by so many should suggest there are reasons to support him over the entrenched bureaucracy.
Indeed, as Greenwald pointed out in a 2017 interview, it’s not a coincidence that former and current members of the deep state clearly preferred Clinton to Trump during the campaign. The deep state bureaucrats prefer an insider like Clinton who who can be trusted to not upset the national security status quo in any way.
Although Trump is no true friend of peace or human rights, he commits his sins largely out in the open. As such, his presidency is relatively transparent, and Greenwald prefers that to the hidden (and extensive) crimes of the deep state.
After all, deep-state agencies face virtually no scrutiny of — and even less real opposition to — their many misdeeds. These, of course, are so numerous as to be impossible to list. But just for starters we might refer to a 2017 article by Sharyl Attkisson in The Hill titled “10 times the intel community violated the trust of US citizens, lawmakers and allies.” It’s a laundry list of illegal, immoral, and blatantly unconstitutional acts which well illustrate the near total impunity with which these agencies operate. Abuse of spying powers is so rampant within the FBI, for example, that even the lopsidedly pro-spying FISA court was forced to conclude the FBI routinely overstepped the bounds of legal surveillance. And, of course, without the heroic whistleblowing of Edward Snowden, the NSA would still be falsely insisting that it doesn’t routinely spy on virtually all Americans, whenever and however it likes.
In response to these facts, one might still insist “but presidents lie a lot and break laws too!” That’s true, but the difference between presidents and deep-state bureaucrats is well illustrated by the current impeachment controversy. It’s the president who’s facing indictments, public attacks, and the prospect of removal. On the other hand, the deep-state bureaucrats who oversee many counts of corruption, illegal spying and leaking, remain safely hidden from public view. Those who routinely lie, deceive, and abuse their power often go on doing so for decades. As the years pass, they become ever more entrenched in the federal bureaucracy, invisible to the public, and — as we are now seeing — often answerable to no one.
Presidents come and go, and they often face fierce opposition from the other party or from the media. The deep state, meanwhile, is said to be full of national heroes who “serve their country” and “speak truth to power.”
It should be easy to see, in the battle between the president and the deep state, which side is the most dangerous.
What is Driving Markets?
I have been mulling over a somewhat contrarian theory as to why the US markets seem to have decoupled from the U.S. economy. I have a commentary with lots of data on this coming Monday, but I wanted to discuss the evolution of my thinking about it today.
I began by asking the Fintwit community what they thought was driving markets, culled from some of the more popular tweets on the topic:
US Markets have rallied to record highs despite economic weakness & Covid-19 surge.
Why are traders ignoring the negatives and powering higher?
— Barry Ritholtz (@ritholtz) July 8, 2020
I was genuinely surprised about the response to that tweet; here is the FinTwit community reaction:
About 60% credited “The Fed” for the market rally off of the lows, while 30% believe it is a bubble; in the comments, more than a few people suggested it was both: a Fed induced bubble.
One option I considered was “Investors are looking past 2020 to 2021/22” (but I swapped it out as too nuanced and replaced it with “Bubble!”).
I half-jokingly noted that no one had suggested “Buybacks,” which if you can remember all the way back to 2019 was a popular explanation for what was driving markets over the prior 5-10 years. Suggestions to add “All of the Above” was thwarted by Twitter’s 4 choice limit for polls, but I think that is as valid an answer as any.
The biggest shock to me: No one whatsoever brought up anything related to “international” in any capacity. No one mentioned overseas regions are the biggest source of revenue for America’s biggest technology companies (and 42% of the S&P500).
I pulled this data form the most recent 10ks for the 6 FAANMG stocks — and it is pretty compelling.
The other item no one thought to mention: How much better the rest of the world is doing than the US in managing its pandemic — in terms of handling the lockdown, communicating the importance of masks and social distancing, in re-opening. Germany and South Korea and Japan, and yes, even China, have all managed this crisis much, much better than we have.
I pointed this out in a tweet Monday, and (again) I was surprised by the responses. A handful of trolls on the other side of the argument, but generally, widespread support.
The United States has 4.2% of the world’s population, but over 25.3% of the infections and 24.4% of the deaths. It is an overwhelming indictment of gross negligence and incompetence pic.twitter.com/eg2jxzpORb
— Barry Ritholtz (@ritholtz) July 6, 2020
The difference between the two tweets is the poll at top was read by a financial audience, while this tweet was pushed into a political audience, thanks to retweets by George Conway, Rick Wilson, and the Mooch.
In finance, all of us tend to bring our confirmation bias to the table, typically reflecting our portfolios. But the political audience are hard core believers, and exist in a bubble within which it is very difficult to change any minds.
My job is to bridge the gap between these two disparate belief systems — politics and financial — to see if I can adhere to Ray Dalio’s prime directive to investors: “There is nothing more important than understanding how reality works and how to deal with it.”
Say what you will about confirmation biases in finance, but all of us have the ability to cover a short and go long. We each change our portfolio allocations, we sell long held beloved companies. Buying and selling often reflect a change of perspective. The feedback loop in investing is very short — buy or sell something, and you usually know if you are right or wrong in a matter of days or weeks, if not hours.
That feedback loop in politics is decades, and it does not tend to encourage circumspection and thought when we are in error.
Mr. Market is cruel but fair, and intolerant of losing positions.
This is the real genesis of the upcoming analysis. See it here on Monday.
Lots of charts after the jump…
FAANMG Stocks (individual) vs S&P500 2015 to present
FAANMG Stocks (individual) vs S&P500 March 23 lows to present
Market Talk – July 10, 2020
The United States has imposed sanctions on three senior officials of the Chinese Communist Party, including a member of the ruling politburo, for alleged human rights abuses targeting ethnic and religious minorities in the western part of the country. The decision to bar the three senior officials from entering the US is the latest in a series of actions the Trump administration has taken against China as relations deteriorate over the coronavirus pandemic, human rights, Hong Kong, and trade.
The United States is in talks with India on market access for its goods in exchange for reinstating New Delhi’s trade concessions under the Generalized System of Preferences (GSP), U.S. ambassador to India Kenneth Juster said on Thursday. Last year, the US scrapped India’s trade concessions under the GSP program that allowed duty-free entry to the US market for up to $5.6 billion of Indian exports in retaliation for India’s high tariffs and rules on e-commerce.
Indian state-owned lender, Punjab National Bank, said on Thursday it had reported loans made to Dewan Housing Finance Corporation Ltd worth 36.89 billion rupees ($491 million) to India’s central bank as “fraud.” Indian state-owned lender PNB, which was hit by a $2 billion fraud involving billionaire Nirav Modi in 2018, had already set aside 12.5 billion rupees in provisions for the loans to DHFL, which is in bankruptcy proceedings. Other banks including State Bank of India and Union Bank have also reported DHFL’s accounts as fraudulent.
The major Asian stock markets had a negative day today:
- NIKKEI 225 decreased 238.48 points or -1.06% to 22,290.81
- Shanghai decreased 67.27 points or -1.95% to 3,383.32
- Hang Seng decreased 482.75 points or -1.84% to 25,727.41
- ASX 200 decreased 36.30 points or -0.61% to 5,919.20
- Kospi decreased 17.65 points or -0.81% to 2,150.25
- SENSEX decreased 143.36 points or -0.39% to 36,594.33
- Nifty50 decreased 45.4 points or -0.42% to 10,768.05
The major Asian currency markets had a mixed day today:
- AUDUSD decreased 0.00141 or -0.20% to 0.69463
- NZDUSD increased 0.0001 or 0.01% to 0.65707
- USDJPY decreased 0.29 or -0.27% to 106.92
- USDCNY increased 0.01336 or 0.19% to 7.01052
- Gold decreased 7.10 USD/t oz. or -0.39% to 1,796.95
- Silver decreased 0.02 USD/t. oz or -0.12% to 18.6465
Some economic news from last night:
China Thomson Reuters IPSOS PCSI (Jul) increase from 67.89 to 72.52
M2 Money Stock (YoY) increased from 5.1% to 7.2%
PPI (MoM) (Jun) increased from -0.5% to 0.6%
PPI (YoY) (Jun) increased from -2.8% to -1.6%
Thomson Reuters IPSOS PCSI (Jul) increased from 33.63 to 33.82
Electronic Card Retail Sales (YoY) (Jun) increased from -6.0% to 8.0%
Electronic Card Retail Sales (MoM) (Jun) decreased from 78.9% to 16.3%
Some economic news from today:
M2 Money Stock (YoY) (Jun) remain the same at 11.1%
New Loans (Jun) increased from 1,480.0B to 1,810.0B
Outstanding Loan Growth (YoY) (Jun) remain the same at 13.2%
FX Reserves, USD increased from 506.84B to 513.25B
Cumulative Industrial Production (May) decreased from -0.70% to -45.80%
Industrial Production (YoY) (May) increased from -57.6% to -34.7%
The UK government has relaxed quarantine rules for travelers from a number of destinations, including France, Italy, Belgium, Germany, and Spain. From July 10, visitors arriving in England from 58 selected countries will no longer be required to self-isolate for 14 days. The US, China, and Portugal are among the destinations that have been left off the list, which is to be kept “under constant review.”
A British-Palestinian MP and staunch opponent of Donald Trump’s Middle East peace plan is running for the leadership of one of Britain’s main political parties after its dismal showing in the 2019 general election. Layla Moran – born to a British diplomat father and Palestinian mother from Jerusalem – is in a two-horse race to head the Liberal Democrats, the fourth largest party in the UK Parliament.
German lawmakers have finalized the country’s long-awaited phase out of coal as an energy source, backing a plan that environmental groups say is not ambitious enough and free marketers criticize as a waste of taxpayers’ money. Bills approved by both houses of the German parliament on Friday envision shutting down the last coal-fired power plant by 2038 and spending about 40 billion euros ($45 billion) to help affected regions cope with the transition.
France, the second-biggest economy in the European Union, returned to growth this month even as activity in the rest of the region continued to decline. The $3 trillion French economy grew this month for the first time since February, as coronavirus restrictions were eased and domestic consumption ticked up, according to a closely-watched survey. An initial reading of the country’s Purchasing Managers’ Index, which tracks activity in the manufacturing and services sectors, jumped to 51.3 in June from 32.1 in May. Readings above 50 indicate an expansion.
The major Europe stock markets had a green day:
- CAC 40 increased 49.47 points or 1.01% to 4,970.48
- FTSE 100 increased 45.79 points or 0.76% to 6,095.41
- DAX 30 increased 144.25 points or 1.15% to 12,633.71
The major Europe currency markets had a green day today:
- EURUSD increased 0.00102 or 0.09% to 1.13004
- GBPUSD increased 0.00216 or 0.17% to 1.26303
- USDCHF increased 0.0008 or 0.08% to 0.94101
Some economic news from Europe today:
Core CPI YTD (Jun) increased from 3.0% to 3.1%
Core Inflation (MoM) (Jun) increased from 0.1% to 0.4%
CPI (YoY) (Jun) increased from 1.3% to 1.4%
CPI (MoM) (Jun) remain the same at 0.2%
PPI (YoY) (Jun) increased from -17.5% to -14.4%
Italian Industrial Production (YoY) (May) increased from -43.4% to -20.3%
Italian Industrial Production (MoM) (May) increased from -20.5% to 42.1%
French Industrial Production (MoM) (May) increased from -20.6% to 19.6%
In a landmark ruling, the US Supreme Court has declared nearly half of the state of Oklahoma to be an Native American Indian reservation. The 5-4 ruling was based on a promise to the Muscogee Creek Nation prior to Oklahoma becoming an official state. “Today we are asked whether the land these treaties promised remains an Indian reservation for purposes of federal criminal law. Because Congress has not said otherwise, we hold the government to its word,” Justice Neil Gorsuch stated. Dissenting Justice John Roberts warned that the ruling would impact the government’s ability to prosecute crimes and “may destabilize the governance of vast swathes of Oklahoma.”
Today, China rejected the proposal for a nuclear arms discussion with the US, with Foreign Ministry spokesperson Zhao Lijian claiming the US was “neither serious nor sincere.” China currently possesses the third-largest nuclear arsenal behind the US and Russia. The Chinese government faulted the US for allowing Russia to propose an extension of the New START treaty that limits the number of nuclear weapons but is set to expire in February. Although the Trump administration would like China to participate in discussions, spokesperson Lijian confirmed, “China’s objection to the so-called trilateral arms control negotiation is very clear, and the US knows it very well.”
The coronavirus outbreak that originated in Wuhan, China, has “severely damaged” US-China relations, President Trump stated this Friday. The US president declared that phase two of the prolonged trade deal is no longer a top priority, as the world is still recovering from the economic damage caused by the outbreak. Furthermore, the president allegedly stated that China had the ability to stop the spread of the virus but chose not to do so.
Police chiefs in Canada are asking the federal government to decriminalize recreational drug use. The Canadian Association of Chiefs of Police believes the matter should be considered a health crisis rather than a criminal offense, and reframing the act could lead to a decrease in overall drug usage, deaths, and drug-induced crimes.
According to Statistics Canada, 953,000 jobs were added to the Canadian economy in June. The total accounts for 488,000 full-time and 465,000 part-time jobs. The current unemployment rate sits at 12.3%, down from 13.7% in May. However, Statistics Canada noted that the real unemployment rate is closer to 16.3% as they did not include those who were not actively seeking employment.
US Market Closings:
- Dow advanced 369.21 points or 1.44% to 26,075.30
- S&P 500 advanced 32.99 points or 1.05% to 3,185.04
- Nasdaq advanced 69.69 points or 0.66% to 10,617.44
- Russell 2000 advanced 23.76 points or 1.70% to 1,422.68
Canada Market Closings:
- TSX Composite advanced 145.18 points or 0.93% to 15,713.82
- TSX 60 advanced 9.67 points or 1.03% to 945.35
Brazil Market Closing:
- Bovespa advanced 871.50 points or 0.88% to 100,031.83
The oil markets had a green day today:
- Crude Oil increased 0.91 USD/BBL or 2.30% to 40.5300
- Brent increased 0.84 USD/BBL or 1.98% to 43.1900
- Natural gas increased 0.025 USD/MMBtu or 1.40% to 1.8080
- Gasoline increased 0.0288 USD/GAL or 2.30% to 1.2795
- Heating oil increased 0.0171 USD/GAL or 1.40% to 1.2400
The above data was collected around 15:00 EST on Friday.
- Top commodity gainers: Lumber (7.41%), Cotton (2.43%), Copper (2.55%), and Canola (3.80%)
- Top commodity losers: Bitumen (-2.63%), Corn (-3.14%), Ethanol (-6.45%), and Coffee (-2.87%)
The above data was collected around 15:05 EST on Friday.
Japan 0.02%(-0bp), US 2’s 0.15% (-0bps), US 10’s 0.62%(+2bps); US 30’s 1.31%(-0bps), Bunds -0.46% (+3bp), France -0.13% (+1bp), Italy 1.31% (+2bp), Turkey 12.39% (+2bp), Greece 1.27% (+16bp), Portugal 0.45% (+2bp); Spain 0.44% (+10bp) and UK Gilts 0.16% (+0bp).
- Italian 12-Month BOT Auction decreased from 0.014% to -0.124%
Extending the $600 weekly unemployment boost would support millions of workers: See updated state unemployment data
The U.S. Department of Labor (DOL) released the most recent unemployment insurance (UI) claims data yesterday, showing that another 1.4 million people filed for regular UI benefits last week (not seasonally adjusted) and 1.0 million for Pandemic Unemployment Assistance (PUA), the new program for workers who aren’t eligible for regular UI, such as gig workers. As of last week, more than 35 million people in the workforce are either receiving or have recently applied for unemployment benefits—regular or PUA.
Figure A and Table 1 show the total number of workers who either made it through at least the first round of regular state UI processing as of June 27 (these are known as “continued” claims) or filed initial regular UI claims during the week ending July 4. Three states had more than one million workers either receiving regular UI benefits or waiting for their claim to be approved: California (3.1 million), New York (1.7 million), and Texas (1.4 million). Seven additional states had more than half a million workers receiving or awaiting benefits.
While the largest U.S. states unsurprisingly have the highest numbers of UI claimants, some smaller states have larger shares of the workforce filing for unemployment. Figure A and Table 1 also show the numbers of workers in each state who are receiving or waiting for regular UI benefits as a share of the pre-pandemic labor force in February 2020. In four states and the District of Columbia, more than one in six workers are receiving regular UI benefits or waiting on their claim to be approved: Hawaii (19.7%), Nevada (19.3%), New York (17.8%), District of Columbia (17.6%), and Oregon (17.0%).
Figure A and Table 2 show the total number of workers who either made it through at least the first round of PUA processing—the new federal program that extends unemployment compensation to workers who are not eligible for regular UI but are out of work due to the pandemic—by June 20 or filed initial PUA claims during the weeks of June 27 or July 4. We do not sum the PUA claims with regular UI claims because some states have misreported PUA claims in their initial claims data, leading to potential double counting.1
As of last week, DOL reported that over 15 million workers across 48 states and the District of Columbia are receiving or waiting on a decision for PUA benefits, which underscores the importance of extending benefits to those who would otherwise not have been eligible. Five states have at least a million workers in this category: Pennsylvania (3.0 million), Arizona (2.3 million), California (1.9 million), Michigan (1.1 million), and New York (1.1 million). New Hampshire and West Virginia still have not reported any PUA claims. Florida, Georgia, and Oklahoma have reported initial PUA claims, but have yet to report any continuing claims.
We should despair for the millions who have lost their jobs and for their families, and our top priority as a country should be protecting the health and safety of workers and our broader communities by paying workers to stay home when possible, whether that means working from home some or all of the time, using paid leave, or claiming UI benefits. When workers are providing absolutely essential services, they must have access to adequate personal protective equipment (PPE) and paid sick leave. The current spike in coronavirus cases across the country—and subsequent re-shuttering of certain businesses—show the devastating costs of reopening the economy prematurely.
As we look at the aggregate measures of economic harm, it is also important to remember that this recession is deepening racial inequalities. Black communities are suffering more from this pandemic—both physically and economically—as a result of, and in addition to, systemic racism and violence. Both Black and Hispanic workers are more likely than white workers to be worried about exposure to the coronavirus at work and bringing it home to their families. These communities, and Black women in particular, should be centered in policy solutions.
To mitigate the economic harm to workers, Congress should extend the across-the-board $600 increase in weekly unemployment benefits well past its expiration at the end of July. If Congress does not extend these benefits through next year, it could cost us more than 5 million jobs and $500 million in personal income. Figure B, at the end of this post, shows these expected job losses by state.
As part of the next federal relief and recovery package, Congress should also include worker protections, investments in our democracy, and resources for coronavirus testing and contact tracing (which is necessary to reopen the economy). At the same time, policymakers should prioritize long-overdue overhauls of federal labor law and continue to strengthen wage standards that protect workers and help boost consumer demand.
The package should also include substantial aid to state and local governments so that they can invest in the services that will allow the economy to recover, particularly public health and education. Without this aid, a prolonged depression is inevitable, especially if state and local governments make the same budget and employment cuts that slowed the recovery after the Great Recession. More than five million workers would likely lose their jobs by the end of 2021, harming women and Black workers in particular since they are disproportionately likely to work for state and local governments.
1. Unless otherwise noted, the numbers in this blog post are the ones reported by the U.S. Department of Labor (DOL), which they receive from the state agencies that administer UI. While DOL is asking states to report regular UI claims and PUA claims separately, many states are also including some or all PUA claimants in their reported regular UI claims. As state agencies work to get these new programs up and running, there will likely continue to be some misreporting. Since the number of UI claims is one of the most up-to-date measures of labor market weakness and access to benefits, we will still be analyzing it regularly as reported by DOL, but we ask that you keep these caveats in mind when interpreting the data.
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