Why are Americans so gloomy about their great economy? - The Economist | Can Europe arm Ukraine—or even itself? - The Economist | The fightback against Javier Milei’s radical reforms has begun - The Economist | Wind turbines are friendlier to birds than oil-and-gas drilling

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Why are Americans so gloomy about their great economy? - The Economist (Full Access)

“The vibes are off” is a phrase that does not usually appear in rigorous economic analysis but has cropped up again and again in serious discussions about America over the past year. From an array of hard data, there is reason to think that people ought to be quite satisfied about the state of the economy: inflation has slowed sharply, petrol prices are down, jobs are plentiful, incomes are rising and the stockmarket is strong. But survey after survey suggests that Americans are in fact quite unhappy. They think that the economy is in bad shape and that President Joe Biden is mismanaging it. What gives?

Start with the evidence of gloom. The figure watched most closely by economists for an idea of what people are feeling is a consumer-sentiment index from the University of Michigan. For the past two years it has bounced around at levels last seen during the global financial crisis of 2007-09. Even with an improvement in December, it is still 30% below its recent peak on the eve of the covid-19 crisis in early 2020.

Many other surveys are equally downcast. Every week since 2009 The Economist/YouGov poll has asked some 1,500 Americans to assess the economy: nearly half now think it is getting worse, up from about one-third in the decade before covid. Questions focused on Mr Biden’s record yield even less enthusiasm: two-thirds of respondents to a Gallup poll in November disapproved of his handling of the economy. And all this despite America outgrowing its large, developed peers over the past few years.

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Can Europe arm Ukraine—or even itself? - The Economist (Full Access)

WARS OF ATTRITION, which is what large-scale conflicts between militarily sophisticated adversaries such as Russia and Ukraine tend to become, are usually decided by which side has the better arms industry. Russia’s economy is nearly 14 times the size of Ukraine’s, but the combined resources of Ukraine’s allies are so much greater that it should be able to win. Yet as the conflict enters its third year, it is Russia’s defence industry that is slowly turning the war in its favour.

Nothing shows the problem more starkly than artillery shells. At the height of Ukraine’s summer counter-offensive, it was using some 7,000 a day, significantly more than the Russians. This has reversed: since last month, while Ukrainian forces have been rationed to 2,000 shells a day, the Russians have been firing five times that number. Talk of a stalemate is complacent. The West now faces a choice, said Jack Watling, an expert at RUSI, a think-tank in London, earlier this month. It can give Ukraine what it needs, “or cede an irrecoverable advantage to Russia”.

Both America and the European Union are having trouble delivering aid. In Washington, $61bn-worth of military assistance is held up in Congress by a row over immigration. In Brussels, €50bn ($54bn) of financial support is stymied by the veto of Hungary’s pro-Russian leader, Viktor Orban. The Europeans are optimistic that aid will be released at a summit in February. But Ukraine worries that American hyper-partisanship and Donald Trump’s hostility will steadily throttle support from the Pentagon. That may leave Kyiv wholly dependent on Europe.

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The fightback against Javier Milei’s radical reforms has begun - The Economist (Full Access)

Javier Milei has wasted no time. Forty-eight hours after taking office on December 10th his economy minister, Luis Caputo, a former banker, unveiled measures to cut public spending by 3% of GDP. He devalued the peso, pledged to slash subsidies, and eliminated nine of 18 government ministries. One week later Mr Milei decreed that state-owned companies could be privatised, price controls would be eliminated, and labour laws reformed.

In the midst of Argentina’s worst economic crisis in two decades, this flurry of activity is intended to push the budget into surplus (before interest payments) by the end of 2024. The IMF, to which Argentina owes $43bn, has noticed. On January 10th it agreed to restart pay-outs to the Argentine treasury, stating that Mr Milei’s government had “moved quickly and decisively” to “restore macroeconomic stability”.

But as well as striving for fiscal rectitude, Mr Milei is doggedly determined to destroy what he has dubbed “the caste”, a network of corrupt politicians, business cronies, media lapdogs and, most importantly, powerful unionists. On December 27th he sent a sprawling “omnibus” bill to Congress, designed to “free the productive forces of the nation from the shackles of the oppressive state”. It would allow Mr Milei to rule by decree for two years, change Argentina’s electoral system, and enforce prison terms of up to six years for those who organise protests that obstruct transport or damage property. All the better to break the caste. One month into Mr Milei’s presidency, the caste has started fighting back.

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Wind turbines are friendlier to birds than oil-and-gas drilling - The Economist (Full Access)

BIRDERS GET nervous when they see landscapes covered in wind turbines. When the wind gets going, their blades can spin at well over 200km per hour. It is easy to imagine careless birds getting chopped to bits. Campaigners often point to the possibility when opposing the building of new wind farms.

No one doubts that wind turbines do indeed kill at least some birds. But a new analysis of American data, published in Environmental Science & Technology, suggests the numbers are negligible, and have little impact on bird populations.

Wind power has expanded dramatically in America over the past 20 years, from 2.6 gigawatts of installed capacity on land in 2000 to 122 gigawatts in 2020. Many studies have analysed the effects in specific locations or on specific bird species. But few have looked at the effects on wildlife at the population level. Enter Erik Katovich, an economist at the University of Geneva. Dr Katovich made use of the Christmas Bird Count, a citizen-science project run by the National Audubon Society, an American non-profit outfit. Volunteers count birds they spot over Christmas, and the society compiles the numbers. Its records stretch back over a century.

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