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Russian Lemons and Other Fakes from Forbes. Part 3
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Russian Lemons and Other Fakes from Forbes. Part 3


WASHINGTON – March 1, 2019

The loud-speaking title of the article once again proves the narrow-mindedness of the largest business edition of Forbes. Citing data from the Peterson Institute for International Economics (PIIE), a high-quality financial consultant Mayra Rodriguez Valladares believes "the Hispanic community in the United States has contributed significantly to US economic growth in recent decades and will continue to do so over the next 10 to 20 years."

Another research analyst, Gonzalo Huertas and Senior Fellow Jacob Funk Kirkegaard, in their recently published working paper, “The Economic Benefits of Latino Immigration: How the Migrant Hispanic Population's Demographic Characteristics Contribute to US Growth,” present an incredible diversity of quantitative analysis that proves that "The outsized contribution of Hispanic immigrants to US economic growth results from the quality of the workforce, not just quantity." Moreover, in what goes against numerous unfortunate, negative stereotypes, "Hispanic arrivals have exceeded contemporary native-born Americans and some other migrant groups in their entrepreneurial capabilities and integration into economically relevant parts of the workforce."

Then Forbes gave data that Hispanics in the U.S. workforce represent significant market opportunities for every type of financial institution, including banks, insurance companies, asset managers, and fintech. According to other data, Unidos US, a non-partisan Latino civil rights and advocacy organization projects that in five years, Hispanics will account for about 20% of the U.S. workforce and over 30% by 2050.

Ludovic Bertron

In addition, Huertas' and Kirkegaard's research shows that "the increase in Hispanic labor could contribute around 0.21 percentage points to annual real GDP growth in the United States over the next three decades if the Hispanic community catches up to the rest of the country in labor productivity." By 2025, the increase in employed Hispanic labor could contribute more to US GDP growth than non-Hispanic labor.

The article also notes that Latin Americans make a great contribution to the entrepreneurship developments "while the US economy has exhibited gradually declining economic dynamism in recent decades." The only difficulty, according to experts, which Latin Americans still face is getting a loan, says Sabrina Terry, Unidos US Senior Strategist of Economic Policy Project, Policy and Advocacy.

"They need the same sophisticated financial planning to manage, conserve and grow their wealth," Terry says.

Moreover, Huertas and Kirkegaard founded that "Hispanic high school graduation rates have risen from just over 60 percent to almost 90 percent in the last 20 years, reaching levels just below the current historically high US average high school graduation rate of 93 percent."

Other important demographic factors for financial institutions are that Hispanics are having fewer children, which can mean, more disposable income for these individuals.

According to PIIE, "even when the recent declining Hispanic fertility and net migration data is taken into account, the community will still account for the majority of the contribution to GDP growth from labor input in the future, a finding that underlines that it is important to continue fostering increased labor productivity among Hispanics. The continued numerical growth of the Hispanic community makes it imperative that their positive trend in educational attainment be sustained and strengthened to include the highest tertiary levels of education. Only then can the Hispanic community reap the full demographic dividend and convergence in wage levels be achieved."

Importantly, the life of expectancy of Hispanics is higher than that of other demographic groups.

This article seems to briefly convey the essence of Forbes and publication experts who don't check a single written word.

Let us turn to more sensible sources. First of all, the growth rate of the United States GDP in the second quarter of 2018 almost doubled – from 2.2% to 4.1% and became the maximum for the four-year period.

The acceleration of economic growth in the United States occurred, according to the U.S. Department of Commerce, which is clearly a more official source, due to the leap in exports and the activity of American consumers.

The contribution of foreign trade to economic growth was 1.06% and was the most significant in five years. Exports managed to increase by 9.3%, while imports grew by only 0.5%, reducing the US trade deficit with key economic partners.

But in the United States, the inflation of consumer spending slowed down: Index PCE Core (Personal Consumption Expenditures, Excluding Food & Energy) which estimates price growth using the Federal Reserve, increased by 2% (against 2.2% in the first quarter). Stocks of goods in warehouses decreased by $27.9 billion in monetary terms – they began to be buyed up.

Economic success has increased government spending by 2.1%, business investment in fixed assets increased by 5.4%, including investments in equipment by 3.9%. But investment in housing decreased by 1.1%, which, as it is known, sometimes are just "investments," if not to say speculative in nature and not always an indicator of economic prosperity.

Experts believe that economic success was due to the stimulating Trump tax policy. But those are just numbers, according to official sources in various US Departments. What is actually the engine of economic development? And how then to explain the success of the US’s economic development?

Chip Somodevilla

The most important thing was the radical nature of the Civil War. Freeing black people, abolishing the slave system in the southern states, organizing a massive land sale by the state in small areas and allowing its purchase by everyone who wished to cultivate the land, the American government opened the way for the development of capitalism. Opportunities for capitalist economic activity were created, which the bourgeois revolution in any of the European countries could not provide.

The natural and geographical factors, as well as the presence of a strong raw material base, were playing a significant role in accelerating the growth of industrial production. In addition, a variety of minerals, vast amounts of fertile soil, the wealth of forest resources, many rivers and unfrozen lakes, a favorable climate can be included here.

US foreign trade policy contributed to the successful development of the economy and capitalist accumulation — imported goods were subject to high duties while at the same time being free to import foreign capital. Taxation of imported goods by duty at 10% after 1861 provided an annual income excess over the state expenses for $100 million.

In 1890, under the McKinley-Aldrich Act, approved by Congress, duties were raised to 49.5%, which was insufficient. In 1897 they were increased to 57%. Protectionism in foreign trade complemented internally: Since 1883, industry was not taxed at all. Entrepreneurs were subsidized by the government with the capital, land, especially in railway construction. All this contributed to the price growth in the domestic market and allowed monopolies to use the tariff policy to maximize profits. At the same time, the inflow of foreign capital to the US increased due to the high rate of return. Thus, foreign capital provided the missing part of the country’s investment. In the early 20th century, foreign investments, mainly British, exceeded American investments abroad by about five times.

An important component of the rapid development of the United States was the full use of scientific and technological progress, as well as the scientific and technological revolution. The United States equipped its enterprises with the latest technology at that time. They were first place in the world for the production and use of electricity — it was used in industry, lighting cities, and everyday life. The first place was in steelmaking, automobile production, oil production and other industries that reflect the technological advances.

Brendan Smialowski

Thanks to the introduction of technical innovations (for example, the conveyor system), as well as high electrical worker labor, which was 4.5 times higher than the British, labor productivity grew at a huge pace. Such progressive production methods of means of mechanization as the steam excavator, the device for automatic loading of ore, work specialization was introduced. Electric means of communication developed rapidly. If in 1900 there were only 13,000 phones, in 1913 — about 10 million.

With regard to the Hispanic presence in the USA, the demographic factor did not play the last role. Due to the low population density, the United States constantly experienced a shortage of labor, which stimulated the mechanization of production processes and the development of technical thought and led to higher wages than in European countries. These circumstances have become an attractive force for immigrants. A law was passed to encourage immigration in 1864. Then at least 30 million immigrants arrived between 1870 and 1914. Part of the migrants were skilled workers and engineers from England and Germany, countries with a high level of technical development, which helped to transfer European scientific and technical experience and freed the American state from the cost of training.

A new wave of immigration came before the First World War. Italian, Austro-Hungarian, and Russian migrants arrived in America. They were without any qualification and ready for any work without claims to a high fee. This wave stimulated the development of production.

It is necessary to take into account the historical and geographical factor. Distance from Europe and proximity to South America allowed this young capitalist country to strengthen its position in the Western hemisphere. Using the Monroe Doctrine and the idea of pan-Americanism, the US first acquired the Hawaiian Islands. And in 1898 they declared war on Spain and under the Treaty of Paris received the Philippine Islands and the islands of Puerto Rico and Guam. Then the United States achieved the exclusive right to build the Panama Canal, tearing Panama from Colombia. The United States used financial bondage, i.e. the economic subordination of weak states, while remaining formally independent. By 1913, US foreign investment amounted to $2.5 billion, of which $1 billion was in Canada and $1 billion in Mexico (oil production). The USA controlled the tin industry of Bolivia, copper in Chile and Peru, the most important railways of South America, and China was the US’ main object of interest n the Far East.

During the Russian-Japanese war, the United States provided financial assistance and diplomatic support to Japan, exporting ammunition, weapons, fuel, locomotives, food, leather goods, etc. For mediation in the signing of the peace agreement between Russia and Japan in Portsmouth (USA), President Teddy Roosevelt was awarded the Nobel Peace Prize (1906).

These are just a few of the main types of economic development of the country which are relevant to this day, in particular during Trump’s reign. Maybe this article will be useful for Forbes; maybe from now on it will be able to rely on more reliable sources of information.

The New York Times described another current view according to which, in order to accelerate the growth rate of the global economy, "world war is needed.”

Western economists in recent years have gone over many different reasons why the world economy cannot begin to develop at a faster pace. Bad weather, greedy banks, lazy Europeans, cunning Chinese — the list of excuses for prolonged economic stagnation is always growing.

Rapid recovery was about to start but instead, short-term bursts of activity after huge injections of funds from the world's central banks were replaced by new stages of slow development. And now, it seems, they got to the main thing...

"War as an engine of progress." This theme is as old as the world. "The End of the World" for some turns into a source of huge profits for others. The larger the scale of the war, the more large-scale investment in new technologies of the military-industrial complex, which then find their application in civilian life. The more devastating the war consequences, the more extensive the subsequent reconstruction work.

The theme of the beneficial effects of a world war gains strength every year of slow economic growth. The New York Times (NYT) article "the Lack of Major Wars May Be Hurting Economic Growth" finally established cause-and-effect relationships and a verdict was issued — either a continuation of slow growth or a world war that will have huge casualties, but then bring prosperity.


The main arguments in favor of a world war, which are directly or indirectly mentioned in the NYT material are:

  • intensification of competition,
  • competition with a strong opponent;
  • guaranteed orders for companies affiliated with the military-industrial complex.

Note one more:

  • redistribution of spheres of influence, the possibility of penetration into new markets that were not previously controlled.

Here are just some questions: What will be the price of a new world war, which the Western media seems to have begun to prepare the ground for? Who will pay this price? And who will once again reap the fruits of the restoration after a shattered world?

Another phenomenon, according to Forbes, causing economic growth is a gig economy. It is not even worth it to describe anything; it is easier to start from the beginning.

First of all, what is a gig economy?

In a gig economy, temporary, flexible jobs are commonplace and companies tend towards hiring independent contractors and freelancers instead of full-time employees. A gig economy undermines the traditional economy of full-time workers who rarely change positions and instead focus on a lifetime career.

Forbes doesn't seem to understand the reason for this phenomenon.

Russian Lemons and Other Fakes from Forbes. Part 3

It is known, Forbes also talks about it, "startups such as Icon, Steady, GreenLight, and Trupo are developing financial, retirement, and benefit products for gig economy workers. Further, major companies utilizing gig economy workers, including Lyft, Airbnb, and Uber, are developing education, workforce and even ownership opportunities."

Former California Labor Department director from 1999-2004 Michael Bernick and the article author seems to believe the gig economy can help to develop the all-country economy.

High profile think tanks and commissions, with conferences and research briefs, tell us that the gig economy is a problem for government policy and planning, Forbes notes. Perhaps; but as policy discussions drone on, individual entrepreneurs are rapidly moving forward.

As an example, Forbes gives several cases of people who are freelancers or individual entrepreneurs independent of the boss. Quoting Forbes: "Laurie Rowley, a financial and retirement specialist, started her career as an entrepreneur in the late 1980s. Her work life has included stints at the Boston Research Group, DCP Inc., and from early 2012 to the present, the President of the National Association of Retirement Plan. She participated in numerous conferences, research papers and discussions on the gig economy."

Other examples apply also to individual entrepreneurs who once changed their main activity to business. Don't you think Forbes is confused?

"Beyond these examples are tens of other entrepreneurs, along with established firms, such as Stride Health,, and Intuit who are developing products for the gig workforce. All of these companies see market opportunities in the growing number of workers not in a full-time employer-employee relation," the article reads. "Whether some or any of these efforts succeed on the market remains to be seen. Gig economy workers may need health, disability or retirement benefits. But whether they have resources to pay for them is untested."

Support for small and medium businesses in the US is not a new phenomenon; on the contrary, President Trump has always supported it as the development of the country's economy.

But it's about a gig economy. First, it's a real day job. By the way, this term is becoming more developed in the world and in the United States, but it's not beneficial for any political course.

Imagine how once people worked in the barracks, and now they drive Uber cars or work at home, crocheting scarves.

There might not be vacations, sick leave, or help, but there is no escape from taxes. In addition, second or third, the economy of any country suffers greatly from day workers. They not only will not buy a home, will not be able to support a family, but they will also barely be able to pay taxes and debts. As has been repeatedly noted in the world, the authorities of many countries plan to introduce new taxes on the self-employed. As for the US, the self-employment tax rate is 15.3%. The rate consists of two parts: 12.4% for social security (old-age, survivors, and disability insurance) and 2.9% for Medicare (hospital insurance). This is done not to the detriment of such, but in favor of the state.

This phenomenon is beneficial mainly only to capitalists, and even then for a limited amount of time; otherwise there will be no one to sell goods.

Now for more global issues. "The inaugural Sadie T. M. Alexander conference in economics and related fields, has seen Federal Reserve governor Lael Brainard ‘applaud and support’ the efforts of the organizers taking the initiative to launch the organization with its goal to increase the representation of black women in the field of economics," Forbes states.

Despite Donald Trump's powerful push against Mexico, with the development of the labor market and business for whites, the US remains devoted to blacks. This is stated even in the Federal Reserve System, as we can see.

Bruce Davidson

Older white Americans still hold the largest share of economic and political power in the United States. However, the younger generations of Americans are far less racially homogeneous, so changes will certainly come.

Soon, the economically active population structure, its political views, and the country's place on the world stage will change irrevocably in America. It will be so large and rapid that the next decade the United States will be transformed much deeper than other countries.

Almost half of Millennials (born between about 1980 and 2000) and their children belong to different ethnic minorities. This diversity is central to demographic change.

As America's future well-being will depend on these generations, everyone needs to think about how to rebuild society so that it can thrive in this new reality.

Frightened generation

Donald Trump entered the White House on a wave of support from older white Americans - older than 45 years. Many of them were attracted by his promises of a better economic environment.

But to a large extent, they were impressed by his position on the issue of the growth of the number of immigrants and political correctness.

This position reflected the concerns of some older white Americans and was part of the generational cultural divide identified by numerously surveys in recent years.

More than half of baby boomers and older Americans in a 2011 Pew Research survey saw an increase in the number of people from other countries as a threat to American values and customs.

Also, according to a 2015 PRRI poll, older white Americans were more likely than younger Americans to believe that the culture and values of American society are now worse than they were in the 1950s.

However, despite these fears, the economic well-being of the country will depend on these new, ethnically heterogeneous generations.

The white population age rapidly

The median age of whites is now 43.

Among Latin Americans — the largest minority in the US — the median age is 29. Among Americans of mixed race, the fastest growing group, the median age is 20.

In eight years, we can expect the white population to begin to decline: The number of deaths will exceed the number of births. The number of whites under the age of 18 is already falling, and this trend will continue due to the decline in the number of white reproductive age women.

But most striking is the rate of aging of the white population.

By 2030, the number of whites over 65 will increase by 42%, while the number of whites of working age will grow by only 9%.

The reality is that soon a large number of old white people will depend on the support of young and racially diverse generations.

Support for young workers

In the short term, most children born in the United States will be from ethnic minorities.

Minorities already make up almost half of American youth. As white baby boomers are eliminated from economic life, minorities will take their place, and the economically active population will grow at the expense of minorities, especially Latin Americans.

Economic growth, tax revenues, pensions and contributions to health insurance for the elderly will depend on them. These demographic facts raise important questions about priorities in public spending.

Currently, a large number of ethnic minority children are enrolled in schools that are chronically underfunded. The number of Hispanics and blacks entering higher education, although increasing, continues to lag far behind whites.

Many of them have neither the financial resources nor the knowledge to find middle-class jobs. Among ethnic minorities, income inequality is particularly acute and threatens to persist in the future.

As in other countries

This sharp increase in the number of young and working people leads to the fact that the situation of the United States is much better than that of other industrialized countries.

The US population is about 325 million people. Since 1980, it has increased by almost 100 million. By the middle of the century, it's expected to reach 400 million. This scenario is very different from the forecasts for most other developed countries.

For example, compared to Japan, Germany, Italy, and the United Kingdom — countries with older populations, lower fertility, and lower immigration rates — the working-age population in the United States will grow faster, at rates higher than 5% per year between 2010 and 2030.

This population growth will help to support economic growth-to increase production, consumption and business opportunities. But all this is possible only thanks to young minorities — Latin Americans and Afro Americans. If not for them, the economically active population of the country would be doomed to decline.

New minorities can also bring their youthful energy, innovation, and entrepreneurial spirit.

On the threshold of big changes

While the cultural gap between generations may persist in the short term, the reality of the changing American population will probably mean that "demography is destiny."

The "explosion of diversity" that America is experiencing today will change all aspects of society.

Government leaders at all levels — and all Americans in general — need to think about how much investment in young minorities is needed today to make the country succeed tomorrow.

More than any other country, the United States is on the threshold of great change.

But these are all dry facts, words and the reality which we live. The problem lies not in the numbers but in the fact that the largest businesses, government agencies, even the Federal Reserve support the black generation.

In the case of Forbes, information support is the most convenient way to promote the "black trend" of the 21st century. The story of Sadie Tanner Mossell, the first African American to receive a Ph.D. in economics in the United States in 1921, once again calls for tolerance towards black people.

As confirmation, Forbes cites the data of "a study of 353 Fortune 500 companies titled ‘The Bottom Line: Connecting Corporate Performance and Gender Diversity’ by Catalyst, a leading research organization working to advance women in business, found that companies with the highest representation of women on their senior management teams had a 35% higher ROE (return on equity) and a 34% higher TRS (Total Return to Shareholders) than companies with the lowest women’s representation."

"Reinforcing the message, another report Women in business: the value of diversity, carried out by accountancy firm Grant Thornton back in 2015 revealed that companies with women on the Board performed better," the Forbes article states.

Looks like this is venturing into feminism. But it's not about women as a form which is strongly oppressed in the United States and that for example, the same Federal Reserve for the first time in 2017 after a hundred years of service elected the head of the first African American Rafael Bostik.

“We need to do better than that, and we will continue our efforts until the group of people around that table is more like America,” Forbes says, quoting the words of Federal Reserve governor Lael Brainard.

It seems that Donald Trump remains too far from the affairs that occur in his mind. While on the one hand he is fighting for a pure race, with another his entourage slowly destroys the system of introducing their staff. Maybe is it not about destruction? Maybe the elites are carrying out their course to displace the objectionables?

Author: USA Really