The U.S. budget deficit hit an all-time monthly high of $234 billion in February. That's $11.7 billion per day, assuming 20 business days in February. Take out Presidents Day, and it's $12.3 billion per day.
Meanwhile, Friedrich von Hayek's Nobel Prize sold at Sotheby's this week for $1.5 million. That's a better result than John Nash's, which failed to sell when it came up for auction in 2016. But it's still less than what a 17th-century copy of the Mona Lisa sold for, despite carrying an estimate of just $80,000–$100,000.
Illustration: Aïda Amer/Axios
To understand the unhappy state of the American electorate, and the systemic headwinds facing the U.S. economy, the best person to talk to is a Nigerian.
The big picture: Corruption scandals are magnified by each other. Theranos and Goldman Sachs and Martin Shkreli and Purdue Pharma and the Fyre Festival and the Catholic Church and billionaire Jeffrey Epstein and parking placard abuse and police violence and all the various Trump administration scandals aren't bad apples: They're part of a pattern, one that the American public is hyperaware of. These headlines foment mistrust in the fairness of the entire system.
Be smart: Western countries are generally perceived as less corrupt than most countries in Africa. But perceptions don't always mirror reality. "Our current corruption discourse is a form of geopolitical racial profiling," says Olopade. Any given act of corruption tends to get blamed on an individual actor in the West, while being considered symptomatic of a broader malaise in a place like Nigeria.
The bottom line: The Mueller report has refocused America's attention on malfeasance during the 2016 election campaign. But as Robert Rotberg puts it in his book about corruption, “Greed never stops at the edge of a presidential palace." The more frequently everyday Americans are reminded that our system is rigged, the less they're going to be willing participants in that system.
Illustration: Rebecca Zisser/Axios
Corruption comes in many forms: cheating, bribery, nepotism, cronyism, embezzlement, fraud, state capture. Donald Trump's nomination of Stephen Moore to the Federal Reserve board falls neatly under the heading of "cronyism."
The Fed shocked the bond markets this week by announcing that it was planning no more rate hikes for the rest of the year. That's despite the fact that current rates are low and growth seems healthy. By coincidence, the Fed's move follows sustained and public pressure from President Trump, urging the Fed to stop raising rates.
Further reading: John Authers explains the most likely economic rationale for Powell's actions, while Greg Ip worries that if rates need to be this low when the economy is doing well, the Fed will not be able to cope if and when the next big downturn happens. And Binyamin Appelbaum reminds us that the Fed seems to be neglecting its other big job, of regulating the banking system.
Businessweek readers know it.
Nowhere are Americans more acutely aware of the system being rigged against them than in the area of education: That's why the Varsity Blues corruption scandal has resonated so widely with the general public.
The real scandal, as ever, isn't what's illegal: It's what's legal. Axios' Courtenay Brown has put together a partial list of ways in which the American educational system is rigged in favor of the rich and powerful.
Why it matters: Inequality of educational opportunity doesn't just deprive the economy of trillions of dollars' worth of untapped human capital. Its ubiquity and visibility also makes it a key breeding ground for resentment and corruption anxiety within the 99%.
The People's Vote march reaches Downing Street. Photo: Isabel Infantes/AFP/Getty Images
Britain will not leave the EU as scheduled this Friday, March 29. The EU has given Prime Minister Theresa May two extra weeks to pass her withdrawal deal or come up with a Plan B.
Spoiler alert: May's deal not only won't pass, it probably won't even come up for a vote. What will happen, on the other hand, is known to no one. There seem to be four possible options:
Driving the news: A million Britons marched in London on Saturday demanding a second referendum, and 5 million of their compatriots have signed a petition demanding that Brexit be repealed. Illusionist and self-proclaimed psychic Uri Geller has even pledged to use telepathy — from Israel, no less — to prevent Brexit.
It's very hard to imagine May calling European elections or repealing Article 50 — but she has lost the support of her party and her Cabinet, which means she might not be prime minister much longer.
The bottom line: Britain is in the throes of its greatest constitutional crisis in centuries. The only certain outcome is that it will emerge from this process humiliated.
Illustration: Rebecca Zisser/Axios
Measuring the extent of global counterfeiting is one of the hardest jobs in economics. Up until a few years ago, it had never been seriously attempted: In 2005, I wrote a 3,000-word blog post titled "All counterfeiting statistics are bullshit." Back then, it was generally accepted that counterfeiting accounted for about 6% of global trade, although no one had a clue where that number came from.
To its credit, the OECD saw that the lack of data was a serious problem. After talking to customs agencies in multiple countries, the international agency released a report in 2016 saying that global trade in counterfeits accounted for no more than 2.5% of total 2013 world trade. That report has now been comprehensively revised and updated, with the new ceiling at 3.3% of 2016 world trade.
Between the lines: The squeaky wheel gets the most grease. The global luxury goods industry tends to complain at the highest volume about counterfeit goods, and, possibly as a result, accounts for the lion's share of customs seizures.
It's rare to see Wall Street fees come down — but when it comes to fund managers, that's exactly what's happening, at a quite astonishing pace.
The bottom line: With $3.4 trillion invested in ETFs and $3.3 trillion in mutual funds, every 10bp of fee reduction means a savings of $6.7 billion per year for American investors.
Alan Krueger, who died this week, was a giant of empirical economics. He didn't assume that raising the minimum wage would reduce employment, as so many of his colleagues did. Instead, he tested that assumption in the real world, and he found that it was often false. He was a great writer, a dedicated public servant and a much-loved mentor. His book on the economics of the music industry will be published in June.
Illustration: Rebecca Zisser/Axios
Asia's Davos, the annual Boao Forum, starts in Boao, China, this week, writes Courtenay.
Lyft shares price on Thursday, with the company going public on Friday. Expect a valuation north of $20 billion. Uber, which will go public as soon as next month, will be watching closely.
The last read on fourth quarter GDP is out on Thursday, so expect more debate about the strength of the Trump economy.
Denys Lasdun designed most of the University of East Anglia between 1962 and 1968. The brutalist ziggurat megastructure, with floor-to-ceiling windows, was a revolutionary utopian vision for postwar Britain; it includes everything from lecture halls to student accommodation. Since 1989, it has housed the British Centre for Literary Translation, founded by the great German writer W.G. Sebald.
Quote of the week
"Money can’t buy happiness? I hate that saying. Money helps a lot of people. To pretend that it doesn’t is just woo-woo bullshit. We live in a capitalist society. Money improves people’s circumstances. It just does." — Jessica Knoll