Triggering by Trump and the emergence of economics of escapism

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A recent survey conducted by the online therapy company Talkspace found that, as of Inauguration Day, over 60 percent of respondents reported feeling some degree of post-election stress. In a 2016 Gallup poll, only 32 percent of Americans said they trusted conventional media “to report the news fully, accurately and fairly,” an eight percent drop from 2015 and the lowest level ever polled by Gallup. To cope with growing discontent, many Americans are turning away from their usual news outlets or their increasingly political Facebook newsfeeds in search of distractions. However, the thirst for distraction is not uncommon in American history, and escapism has become a staple during rough economic and political times.

Defined by the Merriam-Webster as “habitual diversion of the mind to purely imaginative activity or entertainment as an escape from reality or routine,” escapism may seem like a purely psychological issue, but there are very real economic ramifications when companies capitalize on this desperation by filling the demand for a break from reality.

During the Great Depression, Americans flocked to movie theaters. For 27 cents a ticket, about 4 USD in contemporary terms, people could escape the harsh reality of an economic depression for a stretch of time. Films like Dumbo, Fantasia and Arabian Nights, which were released during World War II, transported moviegoers into magical, exotic lands. The 1973-75 economic recession, which also marked the end of the Watergate scandal, the United States’ defeat in the Vietnam War, and two near assassinations of President Gerald Ford, shows a similar trend. In that time frame, directors like George Lucas and Steven Spielberg started releasing fantasy movies like Star Wars, Close Encounters of the Third Kind, The Exorcist and Jaws, all of which were among the top 10 highest grossing movies of the 1970s. Escapist cinema is key during economic and political hard times, as it is one of the easiest and most direct ways to find relief from the real world.

The Walt Disney Company, arguably the biggest player in escapist entertainment, had record breaking inflation-adjusted domestic gross ticket sales of over $2.93 billion in 2016, thanks to popular films like Captain America: Civil War, Finding Dory and Zootopia. From early November to late April, Disney’s stock increased over 26 percent. 21st Century Fox, another box office competitor, saw its stock rise by 37 percent from early September to late March. Even Netflix, which is not a direct competitor but another key player in escapist cinema, saw its stock increase by over 38 percent since the election, compared to a nine percent increase in the S&P 500 Index over the same period. Moreover, half of the top 10 highest grossing movies in 2016 were comic book adaptations, and all of the top 10 movies had a high degree of fantasy, meaning moviegoers actively seek fictional entertainment, and companies provide it.

The demand for escapist fiction extends over many markets, including the literature market. Orbit Books, a fantasy and science-fiction imprint, doubled its annual output last year. With the buzz of a likely science-fiction “golden age,” several other publishing companies launched their own science-fiction imprints. Is there a better way to hide from current unrest than to immerse oneself in a completely different universe? Along with science-fiction, the young adult (YA) genre – fiction published for readers in their teens – plays a key role in literature escapism. Seventy percent of YA novels are not purchased by teenagers, but rather by adults for their own reading enjoyment. YA literature provides not only a means of escapism, but also instant gratification and a sense of nostalgia.

Similarly, adult coloring books bring back nostalgia and reminiscence of childhood for the adult “readers.” In 2015, 12 million coloring books were sold in the United States, a huge increase from the one million sold in 2014. Millennials are 29 percent more likely to purchase an adult coloring book than all other buyers. Since coloring has the potential to reduce anxiety and increase mindfulness, it makes sense that the newfound popularity of coloring books would be directly related to the escalating need for escapism.

The rise of virtual reality (VR) and augmented reality (AR), evidenced by the boom of Pokémon GO, represents a new mode of escapist entertainment. Launched in July 2016 and known as the first use of AR to go “viral,” Pokémon GO has been downloaded globally by over 650 million people. By navigating around their physical surroundings, players are introduced to a parallel world on their phone screens, where a vast array of creatures and Pokémon supplies await discovery. The increase in popularity of AR and VR will be paved with exploitation by marketers, as already seen through the sponsorship deal between Pokémon GO and McDonald’s to entice players into the restaurant chain. Global revenue for the AR and VR markets are projected to reach almost $14 billion in 2017 and $143 billion by 2020. Clearly, this emerging market has the potential not only to provide a new means for escapism, but also to reap massive profits for those companies that utilize AR and VR.

From playing video games to trying new restaurants to visiting amusement parks, escapism is a natural way to de-stress when reality becomes overwhelming. Companies that already provide escapist entertainment are reaping the rewards of widespread unease, and if the U.S. political environment remains volatile, expect new entrants and innovations to satisfy a growing demand for escapism.

Morality aside, refugee acceptance is a matter of economic benefit

refugee photo.jpegBetween Donald Trump Jr. comparing Syrian refugees to poisoned Skittles and a camerawoman kicking and tripping refugees fleeing the Hungary-Serbia border, the resettlement of refugees from Syria to Western countries has faced much derision and scrutiny. Since March 2011, approximately 470,000 Syrians have been killed in their ongoing civil war and more than ten million have been internally displaced or forced to leave the country. This crisis has caused millions of Syrians to seek asylum in other countries, with many of them dying trying to reach refuge. When it comes to the resettlement of refugees into the United States, unwarranted hate, groundless fear and false information have been rampant. More subversively, when it comes to economic research, refugees may actually posit direct, long run economic benefits.

According to the U.S. Department of State, during the 2016 fiscal year, 84,995 refugees from 79 different countries were admitted into the United States. 70 percent of those refugees came from the Democratic Republic of Congo, Syria, Burma, Iraq, and Somalia. Over 72 percent of those resettled were women and children. The screening process can take between 12 and 18 months, with those in desperate situations receiving priority. Less than one percent of the global refugee population passes the first application for resettlement in the U.S.

Of those refugees who were granted residency in the U.S. this year, 46 percent were Muslim and 44 percent were Christian. Since September 2001, about 785,000 refugees entered the U.S. and fewer than 20 were arrested or expunged for terrorist related activities. A risk analysis done by the Cato Institute found that between 1975 and 2015 the chance of being killed in a terrorist attack on American soil conducted by a refugee was 1 in 3.64 billion a year.

A study conducted by Kalena E. Cortes, Associate Professor of Public Policy at Texas A&M University, compared the fiscal growth of refugees to that of economic immigrants, those who enter a country to improve their standard of living and job opportunities. The research found, “In 1990, refugees from the 1975-1980 arrival cohort earned 20 percent more, worked 4 percent more hours, and improved their English skills by 11 percent relative to economic immigrants.” While these refugees initially had lower annual earnings, they greatly outpaced the economic immigrants in economic gains.

Since refugees lack the option of returning to their home country, their time horizon in the host country is much longer than that of economic immigrants. A longer time horizon means refugees have a higher likelihood to assimilate to the earnings growth of native-born citizens. They are incentivized to invest in “country-specific” human capital, such as learning the language or enrolling in the country’s education system. Also, they have a longer period of time to recoup their human capital investments. Not only do refugees add to the economy with labor, they also contribute through consumption. At a local level, refugees exercise their purchasing power, increasing the demand for goods and services.

In Cleveland, 598 refugees were resettled in 2012, with approximately 4,000 more resettled in the decade prior. The Refugee Services Collaborative of Cleveland spent approximately $4.8 million on refugee services in 2012 and the economic impact of refugees on the city during that year is estimated to be $48 million and 650 more jobs. A report by Chmura Economics and Analytics observed that, on average, the refugees found employment within five months of their resettlement, despite their lack of proficiency in the English language. As the labor market participation and income of refugees increased, the reliance and need for government assistance decreased substantially.

The resettlement of refugees can be viewed as an tool for economic development and regrowth. Cities and regions that accept refugees see an influx of laborers who are initially willing to work for lower wage rates, giving an area stuck in an economic trough the chance to re-energize. The Rust Belt city of Utica, NY lost about a third of its population in the second half of the 20th century when local factories closed, stunting economic growth. However, in the past four decades the Mohawk Valley Resource Center for Refugees resettled about 15,000 refugees from 74 different countries into Utica, completely revitalizing the area. The largest group of refugees, Bosnians who sought asylum during the Balkan conflict, have renovated hundreds of neglected houses and opened their own businesses.

Refugees bring fresh energy, innovation and the desire to rebuild to their new hometowns. A study from 2000 on the fiscal impact of refugees in Utica and Oneida county conducted by Hamilton College found that while resettling the refugees required an upfront cost, it was primarily front-loaded and created a net fiscal benefit for the community in the long run. The study also found little evidence that the resettlement of refugees negatively affected employment of native laborers.

Jeffrey Sachs, a senior UN advisor and director of the Earth Institute at Columbia University, observed that the refugees entering the United States currently are more educated than a typical person from their country. New refugees are also expected to be younger, giving them a greater chance to “make it” in the American economy. An investment in refugees not only saves people from dangerous and dire situations, but also brings new life and value into the local, regional and national economy.

The economic case against slavery

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In 1981, Mauritania became the last country in the world to abolish slavery, putting a supposed end to the archaic institution, yet there are an estimated 30 million people illegally enslaved across the globe today. The abhorrent ethics of the practice have not stopped many governments from letting modern slavery slip through the cracks. In order to convince governments to take real action, we must prove that slavery is an economic burden, and an investment in eradicating it will produce returns.

Slaves were once an expensive capital purchase, but rapid population growth in the mid-twentieth century has led to a sharp decrease in the cost of slave labor. Furthermore, unregulated migration systems in many countries have left a lot migrants with minimal information about legal migration and their rights. This has made it easier for criminals to exploit and traffic migrant labor. The International Labour Organization researched the flow of migrant workers into forced labor and found that migrant workers encompass a large percentage of trafficking victims. Business owners who wish to utilize this cheap, disposable labor can achieve higher profits compared to those that pay their laborers a wage, preventing money from flowing naturally from employers to employees and back into the economy by consumption. However, while slavery is profitable for criminal business, it is a drag on the economy as a whole.

Many impoverished, uneducated civilians who are desperate for money are tricked into taking out a loan where labor is demanded as repayment. According to Anti-Slavery International, bonded labor has become the most widespread form of modern slavery in the world. Bonded slaves become illegally trapped in servitude as that loan is extremely difficult to repay and the debt passes down each generation. Slavery flourishes in places with extreme poverty. In fact, it perpetuates poverty as slave labor decreases the wages for unskilled, free laborers, reducing the disposable income of free families. The research of Kevin Bales, co-founder of the human rights organization Free the Slaves, has shown that the first investment former slaves want to make is putting their children in schools. Education is crucial in combating poverty. First, education helps prevent the spread of poverty between generations. Second, learning to read, write, and think critically greatly increases one’s economic rate of return. As long as governments will not do anything to stop the illegal use of slavery, freedman labor remains an untapped resource in an economy.

The article “Slavery is Bad for Business” by Monti Narayan Datta and Kevin Bales states that the production output of slave labor is remarkably low due to a lack of incentives, lack of human development and lower life expectancy. They are not working to their full capacity and, consequently, have low economic value. When slaves are freed, the local economy booms as these people now act as economic agents. There is a greater incentive to increase productivity and their human capital since they are now supporting their families and exercising labor autonomy. Not only do they contribute to the economy through work, but also through consumption as active members of society with purchasing power.

Despite slavery’s persistence, education and legislation designed to hold businesses accountable for their use of servitude in the lower end of their supply chains have proven effective. For example, the California Transparency in Supply Chain Act mandates that any company with worldwide annual revenue above $100 million publicly discloses what they are doing to eradicate human trafficking and forced labor from their supply chain. If companies consciously work to stop purchasing intermediate goods produced by slaves, the demand for slave labor will decrease.

The second, critical step is to invest in freeing slaves and giving them a real chance at living a productive, healthy life. This step is crucial in ensuring the long-term success of those freed from slavery. Bales describes the freeing of slaves in the United States as the “botched emancipation of 1865” where millions of former slaves were left without access to education or political autonomy. Instead they were faced with discrimination and violence, which continues to resonate through society today. Without giving people some sort of chance, they are more likely to fall victim to other types of exploitation.

Ethics aside, slavery is not being addressed aggressively enough by governments around the world. If they looked honestly at the economic ramifications of a monstrous system that refuses to die, only then may governments be coerced to act.