SHI 7.8.20 – The Best Bad Idea?

SHI 7.1.20 – Gone Fishing
July 1, 2020
SHI 7.15.20 – America is # 1
July 15, 2020

I have a favorite scene from the movie “Argo,” the 2012 Oscar winner for best picture.

Here’s the plot:  The year is 1979 – 50 years ago.   The US embassy has been overrun and taken by Iranian militant Islamists and 66 Americans have become hostages.   6 escape in the chaos and find refuge within the Canadian embassy.   If found by the Iranians, the 6 will be executed.  The CIA is tasked with their extraction from Iran before they are found and killed.   Unfortunately, all extraction ideas and options are bad.  Really bad.  Success is dubious at best.  Failure and death are quite likely.  (I’ll stop here if you haven’t seen the movie.  See it.  You’ll love it.  I’m offering a money-back guarantee.)

In my favorite scene, Ben Affleck pitches his CIA boss on his final choice.   His boss does not like the idea and says so.  Ben replies, “Sir, there are only bad options.  It’s about finding the best one.”   And then Bryan Cranston adds:

” This is the best bad idea we have.

Sometimes in life, we don’t get to pick our fights.  This holds true in our fight with Coronavirus.  We didn’t pick it.   We have no other choice but to fight.  None.  We’re in it.  Unfortunately, in this fight, all our options are bad.  All choices, bad.  And perhaps even worse, every bad choice has numerous downstream implications, most of which are also quite bad.   As I watch our city, county, state, federal, and leadership around the globe make public policy decisions to navigate the extremely difficult challenges presented by scourge, I find myself asking a similar, somewhat paraphrased question: 


Are our leaders making the best bad choices?



Welcome to this week’s Steak House Index update.

If you are new to my blog, or you need a refresher on the SHI10, or its objective and methodology, I suggest you open and read the original BLOG:

Why You Should Care:   The US economy and US dollar are the bedrock of the world’s economy.  

But is the US economy expanding or contracting?

Before COVID-19, the world’s annual GDP was about $85 trillion today.  No longer.  It will shrink thanks to ‘The Great Lockdown.’   I did not coin this phrase — the IMF did.  The same folks who track global GDP.   Until recently, annual US GDP exceeded $21.7 trillion.  Again, no longer.   But what has not changed is the fact that together, the U.S., the EU and China still generate about 70% of the global economic output.

The objective of this blog is singular.

It attempts to predict the direction of our GDP ahead of official economic releases. Historically, ‘personal consumption expenditures,’ or PCE, has been the largest component of US GDP growth — typically about 2/3 of all GDP growth.  In fact, the majority of all GDP increases (or declines) usually results from (increases or decreases in) consumer spending.  Consumer spending is clearly a critical financial metric.  In all likelihood, the most important financial metric. The Steak House Index focuses right here … on the “consumer spending” metric.  I intend the SHI10 is to be predictive, anticipating where the economy is going – not where it’s been.

Taking action:  Keep up with this weekly BLOG update.  Not only will we cover the SHI and SHI10, but we’ll explore related items of economic importance.

If the SHI10 index moves appreciably -– either showing massive improvement or significant declines –- indicating growing economic strength or a potential recession, we’ll discuss possible actions at that time.


In 1964, when rendering a Supreme Court verdict intended to state, once and for all, the legal definition for “hard-core pornography and obscenity,” Justice Potter Stewart opined, “I shall not today attempt further to define the kinds of material I understand to be embraced within that description, and perhaps I could never succeed in intelligibly doing so.  But I know it when I see it, and the motion picture involved in this case is not that.”

“I know it when I see it.   And this is not it.”   What a perfect expression to highlight the public policy challenges our leaders face.   They must make public policy decisions.  That’s what they were hired do.  But in this environment, where there are no good choices, how can they figure out which are the best bad choices?  

Since the beginning of 2020, the Coronavirus has occupied almost every minute of the news cycle every day.   Of course, until the murder of George Floyd.  But it seems to have reclaimed the top spot once again, as new cases of the virus spike around the US.   Paraphrasing Justice Stewart’s brilliant observation, using my favorite scene from Argo as the back drop, I may not know the best bad public policy choice when I see it, but the worst bad choices are easy to spot.   Take this one for example. 

From a New York Times article published today, with this headline,


Churches Were Eager to Reopen.

Now They Are a Major Source of

Coronavirus Cases


… we learn that more than 650 new CV-19 cases are “linked to reopened religious facilities.”   No, opening churches again, in my opinion, is not a horrible choice.  In fact, if opened “responsibly“, the decision probably falls into the category of a good-bad choice.   But it wasn’t implemented responsibly.  Face coverings in re-opened churches were not mandatory. 

But the worst bad choice was made by Charles Hiser.   Charles was a member of the Graystone Baptist Church in Ronceverte, West Virginia.  The church re-opened with a ‘masks-optional’ policy.  And Charles, who was 82, was the first of three churchgoers to die after contracting CV-19.   His daughter Libby, said “her father had lived alone and had spent the last few months cooped up at home to stay safe. She brought him groceries and talked to him regularly on the phone so he was not lonely. But (my father) missed going to Graystone Baptist, where he had attended services for 30 years or so.”   So as soon as regular services resumed at the end of May, he went right back, and like many other worshipers at his church, did not wear a mask.    Libby commented further in the Times article, “I felt like, gosh, I was thinking he’d be safe there. You know, you’re in church. Just like a child that goes to school is supposed to feel safe.”  The church now has has at least 51 confirmed cases and 3 people have died. 

Wow.  Libby, for gosh-sake, your dad was 82!   He’s was not safe from Coronavirus — anywhere!   Libby, I’m sorry to be the one to say it, but permitting your 82 year old father to go to church services, where face coverings are optional is one of the worst bad choices I’ve seen.    Downright moronic, to be frank. 

Other choices are harder to judge.   “Bad-bad choices” are easy to spot.   But “good-bad” choices are not.   They are complex.   Complexity increases in today’s super-charged political and partisan environment, where all public policy choices are viewed one-sided, thru the lens of Democrat or Republican, or whatever other identity political lens one uses.  

  • Was it a good-bad choice to require folks to stay home back in March, when the severity of CV-19 was relatively unknown?    Yeah, it was probably a good-bad choice, even knowing the repercussions on employment, businesses, and governments would be significant
  • Was it a good-bad choice to extend the closures from several weeks to several months?   I have more trouble with this one. 
  • With CV-19 cases averaging about 50,000 per day here in the US, is it a good-bad choice to “re-close” some segments for  second time? 
  • If new cases calm down, only to “spike” again, would a future good-bad choice bet to “re-close” again and again, over and over? 

What’s the best-bad choice … given the challenges and implications of each?   As I said above, it’s hard to tell, especially as we consider known outcomes and facts:

  • The WHO today reported 11.5 million ‘known’ cases of CV-19 worldwide.   And they reported 535,759 deaths.
  • OECD headline:  “Urgent action needed to stop jobs crisis becoming a social crisis.”   The number of unemployed in the ‘OECD area’ was 54.5 million in May.
  • BBC headline:  “Coronavirus lockdown:  India jobless numbers cross 120 million in April”
  • NY Times headline:  “Pandemic plunges Puerto Rico into Yet Another Dire Emergency”  Out of a 1.05 million person labor force, 300,000 have filed for unemployment in the territory.   The island already had the highest poverty rate in the US.

The list goes on and on and on.   Cutting thru the noise, the challenge I have with this debate is the vitriol on both sides.   Combatants paint their opponents as moronic or irresponsible — as though every position is absolute, and any other choice is bad.   This isn’t true.   Every choice has implications and/or repercussions.   Take the choice to ‘re-open’ Disney World.  New York Times printed this headline and article today:  “Disney World Draws Excitement and Incredulity as Reopening Nears”.  Incredulity?  Apparently, yes.   Because, in the opinion of some people very much opposed to this idea, re-opening Disney World is irresponsible under any conditions.

And therein lies the problem with positions both sides in the debate.  The choice each side presents appears binary.   All or nothing.  Open or closed.   It appears there is no middle-ground.   Can these be the best bad choices?

No, there must be a middle-ground.   Six months into the pandemic, we clearly understand the health crisis.  And we’re now seeing the ‘social crises’ grow larger and clearer every day.   How should our leaders solve for both … what are the best bad ideas given the duality?   What choices can be made and implemented responsibly?  By my observation, there seems to be general consensus — no, not with everyone, but in general — that being outdoors, maintaining distance between unrelated groups, and face coverings can help limit exposure and transmission. 

We have a federal law requiring all front-passengers wear seat belts.   (Apparently, New Hampshire adults are exempt.  Go figure.)   Until a vaccine is commonplace, why not have a federal law requiring face coverings in circumstances where distance cannot be maintained?  Should offenders receive a citation and be charged a fine?   (With exceptions for food establishments.)   Given the challenges we face, might this be a good-bad idea?  

These are my thoughts and opinions only.  I’m sure you have your own.  That’s permitted.  And you’re even permitted to disagree with me without me suggesting you’re wrong! 🙂

Let’s start the debate!  Because, as a matter of fact, like you, I struggle to to find the best-bad ideas under these conditions.   The worst-bad ideas are more obvious.   But the best-bad ideas, at least from our leaders, appear elusive so far. 

– Terry Liebman

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