Posted by Lolo Robison
President Julie Pingston sounded the bell, bringing Rotarians to order. The invocation, beautifully written and delivered by Michelle Lantz, encouraged Rotarians to seek the best for every individual in our community; asked for new opportunities and resources for those facing economic hardship; encouraged those who have to share with those who don’t. She prayed for wisdom for decision-makers about our economy and climate; for compassion; and for faith, hope and love.
For the patriotic song, President Julie believed that Kevin Schumacher, who didn’t attend, would appreciate a video recording of James Taylor playing America the Beautiful before a live audience during President Barack Obama’s 2013 presidential inauguration.
Visiting Rotarians included Tammy Lemmer, Tri-County Office of Aging. Tammy is a member of the Haslett-Okemos Rotary Club. She served briefly as assistant governor for both her club and the Lansing Rotary Club. Rebecca Bahar-Cook introduced Eric Lupher, president of Citizens Research Council. She and Eric worked together for a number of years. Looking for unbiased, nonpartisan public policy? Look them up at For those who want some homework before they vote, CRC will publish a few papers next week on the two constitutional amendments on the ballot in November. Kim Garland, with the Delta Dental Foundation, returned for a second time to Rotary. She is looking forward to becoming a “real Rotarian.”
Diane Sanborn reported happy news from Kelly Rossman-McKinney. She will be in treatment for two years to completely eradicate her cancer. She is currently working from home and doing very well. Here’s to a speedy recovery, Kelly! We all look forward to seeing your smiling face again soon.
President Julie wished everyone who celebrated a birthday in August a happy birthday and thanked them for supporting the Rotary Club with a birthday donation. Andy Brogan’s birthday question for August was, “What’s one thing that you would now like to add to your bucket list?” Jeff Crippen hopes to qualify for the Boston Marathon in 2022 by getting a qualifying time in 2021. Pat Hanes would like to ski, snowboard, wind-surf, surf and fly-board. August birthday donors had a 90 percent participation rate.
Pam Miklavcic (pronounced Mic-lowch-itch) reported on September birthdays, whose honorees raised $1,225 – a 48 percent participation rate. “What have you experienced [during the pandemic] that is positive?” she asked. Chris Swope said he found that “the pandemic doesn’t change who people are but it does frequently reveal who people really are and sometimes makes them more of who they already were.” Irv Nichols said he finished a few books that he’d begun before but never finished, and as a live-alone person and a poor cook, he’s now an authority on takeout restaurants. Pat Munshaw found that she can fritter away a whole day without feeling guilty.” Mark Kraushaar said he has embraced change because he didn’t have a choice and, as a result, has become more efficient, productive and appreciative of things that he may have taken for granted.” Craig Galecka said, “People helping others by getting food, supplies, etc., to those unable or unwilling to take the risk of going to the grocery store. Also, it has been great meeting, at least saying hello while socially distanced, to many new people now walking through our neighborhood.” Donna Gardner wrote, “Candidly, an answer did not come quickly to this very people-oriented person, who is desperately missing my peeps. I have, however, opened a few doors to learning that I might not have otherwise had the time or the budget for. Attending some amazing virtual conferences, took classes through Master Class, and joined an international Mastermind group of coaches. I have expanded both my interests and my community.” Nicole Baumer wrote, “Being able to spend more time up north with my best friend, my mom.” And Pam said, “Twice-a-week Zoom calls with my 94-year-old mom and four siblings, all of whom are on the East Coast, has allowed us to be connected and get to know each other beyond the holiday whirlwind. I’ve also enjoyed spending lots more down time with my husband and kids, and while we acknowledge the gravity of the pandemic, ours is a family of introverts that has found the forced slowdown somewhat soothing.” Happy birthday to all September Rotarians!
Curt Sonnenberg wished everyone a happy Friday from the Western UP, and announced that the Foundation’s kickoff commenced today for 2020-2021 International Project Grants. The Foundation has $40,000 to spend this year. Proposals will be accepted through Oct. 31The Foundation is looking for great projects – health, medical, anything within Rotary’s mission statement. Please share project ideas with the committee by emailing Curt at Details at
President Julie announced that a new program – Lansing Reads – has been organized. Karen Granneman has been promoting it and encouraging people to take part it in. Lansing School District’s Pathway Promise, Lansing Regional Chamber of Commerce, the Capital Area District Libraries’ Reading is Fundamental Program and the Lansing Promise. It is designed to improve third-grade literacy levels by providing resources to Lansing’s K-3 students. It’s a fundraiser, but also a way for everyone to get involved. Some Rotarians are already signed up to create a video wherein they read a children’s book, which will help create a variety of voices that read. Donate and sign up to read at I did, and so have many fellow Rotarians!
Justin Sheehan added that the community and Rotary believes in its kids. One hundred percent of the funds raised through the Lansing Reads program go straight to purchasing books and supporting the RIF program. Lansing Promise simply has the privilege of acting as a platform to accept donations. The audience is 5- to 8-year-old students, so have fun as you’re reading to them. Opportunity to engage and let the community know we care.
Courtney Millbrook with the Lansing Symphony Orchestra then introduced the LSO’s principal harpist, Britney DeYoung. She recorded the session last spring for the LSO at Home series, which is still available at Britney will perform live Tuesday at 6 p.m. on the lawn of MSUFCU as part of LSO’s Outdoor Chamber Series. The concert is sold out, but there is a waiting list. Britney played a couple of short and fun pieces: The Propulthieth Prelude in C, and Marcel Tournier’s Supir and Aufraut. We also enjoyed Irv Nichols’ harp accompaniment.
Chris Holman, who is Chair of the Month and Chair of the Day, introduced our featured speaker, Paul Traub, Senior Business Economist with the Federal Reserve Bank of Chicago, who gave a riveting 30-minute presentation that comprised 102 slides, mostly focusing on the U.S. economy, some regional matters, C+I+G(+X) – consumption, investment, government spending (and net exports) – and what the Federal Reserve has been doing in its role to stimulate the economy as we move through the pandemic. He made it clear that his presentation represented his views and his views alone. Highlights included:
• Real GDP fell by 31.7 percent in the second quarter – the largest fall since 1947, which is as far back as Paul’s data goes. The closest spiral in history, by comparison, was back in the early 1950s with a 10 percent drop.
• The UofM consumer index jumped up a little in September but is fluctuating.
• Two things drive the consumer: 1) the ability to buy (“Do I have money?”); and 2) willingness to or attitude toward spending). The consumer is now more than 2/3 of the economy, so they have a big impact on the index.
• Business investment declined 28.9 percent in the second quarter; nonresidential falling 26 percent and residential 37.9 percent.
• The trade deficit fell, contributing positively to the economy, because imports fell more than exports.
• According to the report by the Congressional Budget Office regarding our national debt, our deficit has reached a level not seen since WWII, and it is still growing
  We added 1.371 million jobs in August, but total employment is still down by over 11.5 million jobs since it peaked in February.
• Our target for inflation is 2 percent, and because it’s under 2 percent, that gives the Fed all the leeway it needs to do the types of things it wants to do. They’ve done a tremendous amount.
• We are now in a recession. He compared what the recession was like in 2001 (March 2001 – November 2001), what it was like in The Great Recession (December 2007 – June 2009) and the historic fall in current economic activity in just one quarter. The consumer attitude number went up to 78.9 – a new peak from its precipitous decline as we entered into the recession. It’s still at levels we haven’t seen since the 2012 – 2014 range, when we were digging out of what we thought was going to be the greatest recession we would see in our lifetime.
• There’s been a big jump in real disposable personal income, averaging roughly around 3.5 percent. This is your ability to spend. It jumped way up, and then fell back down a little – not because wages and salaries went up but because of all the fiscal stimulus money that’s been thrown out, which has been pushing up consumers’ real disposable income. If you break it down and look at the average over time, in an average quarter – look at 2019 – the average quarter change in real disposable income was about $160 billion. That’s growth in the economy. In the second quarter alone, it grew by almost $1.5 trillion. That’s a really big jump.
• Compensation was down by almost $80 billion; rental income was down. Transfer payments – monies that went out for a number of reasons – was $2 trillion thrown into the economy, other spending and other loans issued as part of the pandemic relief – a huge bunch of money going out into the economy.
• People saved a lot of it, so the savings rate jumped by 33 percent. The 5-year average has been 7.4 as a lot of that money was saved. Even as late as July, it was still over 17 percent of the savings rate. People are hanging onto that money.
• On a year-over-year basis, consumer credit jumped in April by over 17 percent. This points to what was going on just prior to the pandemic. The economy was starting to go through its normal business cycle. It was the longest economic expansion in the history of the country – over 10 years – and we were starting to see that become mature. People were starting to slow down their consumption a little bit. Some of this credit was used to pay normal bills, insurance payments, to buy groceries because they didn’t have money, which stay on balance sheets for quite some time.
• Retail sales stopped and then jumped way up in April, and now it’s starting to fall back down.
• Housing starts fell and then jumped back up. They were doing quite well in the winter months due to warm winter, so housing starts are back near levels that would support population growth. Existing home sales have sprung back, partially because the banks have lowered interest rates. Fixed-rate mortgage are under 3 percent, which helps stimulate the market.
• Total trade (imports + exports, seasonally adjusted on a quarterly basis) is down almost 60 percent, which reflects what’s going on globally, not only what’s happening here. This pandemic has hit the world. We’re not taking imports and we’re not sending out exports.
• When you’re in a pandemic, you’ve got to spend a lot of money, which had already started with some of the tax cuts that were put into play during the middle of the expansion. A lot of economists said this was unnecessary. We created some deficit debt. We’ve already created a $1-trillion-a-year deficit. We’ve added, in the last quarter on an annualized basis, another $5 trillion in deficit. If you look at what the Congressional Budget Office is predicting, we’re going to exceed our long-term trend out to 2030. If we continue on this path, by 2050 we’re going to have a gross national debt that will eclipse anything we’ve seen and approach 200 percent of GDP. This is unsustainable. It’ll be a real problem no matter who wins the election in November, because we cannot continue on this pace. We’ll become so indebted that all of a sudden you’ve got to sell. If it becomes 100 percent, you’ve got to sell $22 to $25 trillion in treasury bills, and then that starts crowding out other investments, so investors, instead of investing in machinery or equipment or education, could just be buying treasury bills. If it’s 200 percent, that’s $40 to $45 trillion in treasury bills in the market.
• Unemployment jumped. It started to come back down and in August sat at 8.4. Those who left the labor market are not in the equation – neither in the denominator nor the numerator. This is what brought down the unemployment rate. We’ve lost 22 million jobs and are still down by 11.5 million jobs across the board, particularly in leisure and hospitality, natural resources and mining. This hurts the U.S. economy, because we now produce more fossil fuel than anybody in the world, with oil, natural gas, fracking and coal. That industry won’t go back until prices start to rise on oil and even now, out through the next two years, the futures are still below $50 a barrel.
• Our earnings jumped up, because we had to pay people a lot of money. Most of the jobs that remained were “essential workers.” Most of the jobs that were lost were low-paying jobs. Now, the high-paying jobs are primarily what’s left, so you see a big jump in wages. The top four that lost employment were leisure and hospitality, mining and logging, and information, which are not keeping up with the 4.6 percent growth. The average is 4.65 among financial activity is considered essential, trade and transportation, truckers, moving goods – these industries are doing well.
• Unemployment claims have fallen to under 900,000 as people start coming off of unemployment.
• Personal Consumption Expenditures (vs. Consumer Price Index) adjusts for substitution. Think about CPI as a fixed basket of goods, based on everybody buying the same stuff and what’s happening to the price of that basket of goods. PCE adjusts for what you buy. If you go to the store and steak’s too expensive, you buy chicken instead. If chicken is too expensive, you buy fish. It adjusts for what you buy, so it’s a better gauge of what’s really going on for the consumer’s pocketbook and household budget.
• Inflation does not yet exist, but we’re starting to read about people seeing the price of food going up. Right now, with a slowed-down market, we’re not seeing inflation.
• People are asking, “Could the Fed do more? Do we need another fiscal stimulus package?” The Fed has done all it can.
• Everybody says, “Print more money.” Currency in circulation does not grow that much. The Fed creates liquidity. That’s bank reserves of credit. We can’t force people to borrow it or spend it to stimulate the economy, but having it is there as a fallback. We brought down the volatility in the stock market. We tried to stabilize that, and banks have done a pretty good job of that.
• We are not out of the woods. We won’t get back to where we were until the end of 2021. We still have a long way to go. The whole world has fallen down. A lot will depend on COVID, and right now, we’re seeing an upward trend. We’re now averaging around 40,000 cases a year, we’ve got 200,000 deaths, and we’ve never really gotten back to where we were able to flatten things out. I see it start to return as we enter the cold and flu season. We’ve opened up schools, we’ve opened up the economy a little more. What happens is, the disease comes back. Whether we get back on track at the end of 2021 depends on COVID. We are currently back to cases twice what we were able to reduce the levels to in June under tighter restrictions, so if we want to get back there we might have start closing down again with tighter restrictions.
In lieu of a gift, the Lansing Rotary Club will make a donation in Paul's name.  He said he would rather have that than another coffee cup.  
Next Friday, October 9th, Terry Terry will be Chair of the Month.  Our speaker will be Dr. Steve Robinson, LCC President.
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