Author: Art Diamond

Chinese Communist One-Child Policy Caused “Intense Suffering of Ordinary People”

(p. B12) Kay Ann Johnson, an Asian studies scholar whose adoption of an infant girl from China led her to spend years researching the impact of the country’s one-child policy on rural families, died on Aug. 14 [2019] at a hospital in Hyannis, Mass.

. . .

For more than 20 years, Professor Johnson focused her research on Chinese villages where birth parents found themselves in a lopsided clash with a state bent on controlling population. The policy was also applied in cities, but villagers were usually more daring about trying to resist it. Professor Johnson presented her research in often painful case studies based on interviews with birth parents who described facing the ruthless policy.

One of those parents, Jiang Lifeng, already had a son when she became pregnant. She planned to keep the child and hoped to have a daughter. She avoided detection (and possibly forced sterilization) during pregnancy tests imposed by the authorities by using a friend’s urine. She delivered a girl, Shengshi. But nine months later the infant was taken from her bedroom by seven men, presumably government representatives, and driven away in a van.

Ms. Jiang recalled that “she ‘felt the sky fall down’ on her as she staggered after them, shocked and aghast at what had just happened,” Professor Johnson wrote. Ms. Jiang somehow caught up to the van and rode with the men and Shengshi to a local birth planning office, where she and her husband, Xu Guangwen, pleaded for the girl’s return. Officials refused.

The couple were told that they could adopt her after she had been taken to an orphanage. But that, Professor Johnson said, was a lie.

“The government had taken their baby, stripped them of their parental rights, and left them heartbroken and powerless to do anything about it,” she wrote. “It had been nothing short of a kidnapping by the government, leaving them no recourse.”

In his review of “China’s Hidden Children” in Foreign Affairs magazine, Andrew J. Nathan, a professor of political science at Columbia University, praised Professor Johnson for debunking the myth that Chinese parents did not value girls, and for outlining the often terrible consequences of the one-child policy.

“Johnson’s extraordinary book conveys the intense suffering of ordinary people struggling to build families against the will of an implacable bureaucracy,” Mr. Nathan wrote.

Kay Ann Johnson was born on Jan. 21, 1946, in Chicago. Her father, D. Gale Johnson, was an agricultural economist and the chairman of the economics department at the University of Chicago.

For the full obituary, see:

Richard Sandomir. “Kay Ann Johnson, 73, Who Studied China’s Painful One-Child Policy, Dies.” The New York Times (Friday, August 30, 2019): B12.

(Note: ellipsis, and bracketed year, added.)

(Note: the online version of the obituary has the date Aug. 29, 2019, and has title “Kay Ann Johnson, 73, Who Studied China’s One-Child Policy, Dies.”)

Johnson’s book, mentioned above, is:

Johnson, Kay Ann. China’s Hidden Children: Abandonment, Adoption, and the Human Costs of the One-Child Policy. Chicago: University of Chicago Press, 2016.

Top 0.1% Have 15% of U.S. Wealth

(p. A1) The income tax is the Swiss Army Knife of the U.S. tax system, an all-purpose policy tool for raising revenue, rewarding and punishing activities and redistributing money between rich and poor.

The system could change fundamentally if Democrats win the White House and Congress. The party’s presidential candidates, legislators and advisers share a conviction that today’s income tax is inadequate for an economy where a growing share of rewards flows to a sliver of households.

For the richest Americans, Democrats want to shift toward taxing their wealth, instead of just their salaries and the income their assets generate.

. . .

In the real world, a wealth tax would emerge from Congress riddled with gaps that the tax-planning industry would exploit, said Jason Oh, a law professor at the University of California, Los Angeles. For example, if private foundations were exempted, the wealthy might shift assets into them.

“We’ve never seen in the history of taxation a pristine tax of any form,” Mr. Oh said. “People who want to pursue a wealth tax for the revenue may be a little disappointed when we see the estimates roll in.”

European countries tried—and largely abandoned—wealth taxes. They struggled because rich people could switch countries and because some assets were exempt. Mr. Zucman said Ms. Warren’s tax would escape the latter problem by hitting every kind of asset, from artwork to stock to privately held businesses to real estate.

While he and fellow economist Emmanuel Saez assume 15% of the tax owed would be avoided, former Treasury Secretary Larry Summers and University of Pennsylvania law professor Natasha Sarin wrote a paper estimating the plan would raise less than half what Mr. Zucman projects, based on how much wealth escapes the estate tax.

A paper by economists Matthew Smith of the Treasury Department, Eric Zwick of the University of Chicago and Owen Zidar of Princeton University contends top-end wealth is overstated. Acccording to their preliminary estimate, the top 0.1% have 15% of national wealth, instead of the 20% estimated by Mr. Zucman. Their findings imply that Ms. Warren’s tax might raise about half of what’s promised.

For the full story, see:

Richard Rubin. “Democrats’ Tax Idea: Target Wealth, Not Just Income.” The Wall Street Journal (Wednesday, Aug. 28, 2019): A1 & A8.

(Note: ellipsis added.)

(Note: the online version of the story has the date Aug. 27, 2019, and has the title “Democrats’ Emerging Tax Idea: Look Beyond Income, Target Wealth.”)

The paper co-authored by Smith, and mentioned above, is:

Smith, Matthew, Owen Zidar, and Eric Zwick. “Top Wealth in the United States: New Estimates and Implications for Taxing the Rich.” Working Paper, July 19, 2019.

Lyft Driver Fears California Law Will Destroy Her Work Flexibility

(p. B4) California lawmakers have hailed the law signed by Gov. Gavin Newsom this week that could require drivers of ride-hailing companies to be labeled as employees rather than independent contractors, saying the measure could raise wages and provide new workplace benefits.

But the drivers are divided about how it will affect them.

For Rachel Hudson, a 43-year-old driver for Lyft Inc. who struggles with arthritis and an anxiety disorder, the bill’s passage is unwelcome. Ms. Hudson has driven for Lyft for about five years and fears employment status could mean having to work in scheduled shifts that would wipe out the flexibility she needs.

“Sometimes, I need a two- to three-hour break. I can’t always be relied upon to be at work at specific times,” Ms. Hudson said. Driving for Lyft “is the only way I can afford a car. It makes a huge impact on my life.”

Ms. Hudson, who lives alone in Stockton, Calif., said that besides federal disability benefits, the earnings from Lyft are her only income.

For the full story, see:

Sebastian Herrera. “Uber, Lyft Drivers Torn Over Law Meant to Protect Them.” The Wall Street Journal (Monday, Sept. 23, 2019): B4.

(Note: the online version of the story has the date Sept. 21, 2019, and has the title “Uber, Lyft Drivers Torn as California Law Could Reclassify Them.”)

Strong Job Market Allows Lower-Income Workers to Change Jobs

(p. A3) The share of lower-income Americans leaving their jobs for new ones leapt earlier this year, pointing to rising confidence in the U.S. labor market among workers who were left behind earlier in the expansion.

A New York Fed survey released Monday showed the share of lower-income heads of household, defined as earning a household income of $60,000 a year or less, who moved to new jobs in April, May, June or July was 12%, up from 8% in the same period a year earlier and the highest rate for records dating back to 2014.

Meanwhile, job changes among higher-income workers have been declining since early 2018.

The lower-income workers had more opportunities: About 4% of lower-income Americans received three job offers in the four months ended in July, up from 1.4% over the same period in 2018, according to the data in the New York Fed Survey of Consumer Expectations.

For the full story, see:

Sarah Chaney. “Lower-Income Americans Are Job Hopping.” The Wall Street Journal (Tuesday, Sept. 24, 2019): A3.

(Note: the online version of the story has the date Sept. 23, 2019, and has the title “Lower-Income Americans Are Increasingly Job Hopping.”)

Newsboys “Were American Icons–Symbols of Unflagging Industry”

(p. A17) Thomas Edison was one. So were Harry Houdini, Herbert Hoover, W.C. Fields, Walt Disney, Benjamin Franklin, Jackie Robinson, Walter Winchell, Thomas Wolfe, Jack London, Knute Rockne, Harry Truman, John Wayne, Warren Buffett and many more familiar names. Besides being illustrious Americans, these men shared a calling—growing up, they were newsboys, delivering newspapers to subscribers or, more colorfully, hawking them on the streets for a couple of pennies, real money in those days.

In their time, newsboys (girls were rare) were American icons—symbols of unflagging industry and tattered, barefoot, shivering objects of pity. They had their own argot and better news judgment than many editors, because they had to size up the appeal of every edition to determine how many copies to buy from the publisher.

For the full review, see:

Edward Kosner. “BOOKSHELF; Street-Corner Capitalists.” The Wall Street Journal (Monday, Oct. 7, 2019): A17.

(Note: the online version of the review has the date Oct. 6, 2019, and has the title “BOOKSHELF; ‘Crying the News’ Review: Street-Corner Capitalists.”)

The book under review is:

DiGirolamo, Vincent. Crying the News: A History of America’s Newsboys. New York: Oxford University Press, 2019.

“Openness to Creative Destruction” Discussed on Power Trading Radio

John O’Donnell interviewed me at 6 PM 11/8/19, about my book “Openness to Creative Destruction” on his weekly Friday show on Power Trading Radio. (In the screen capture above, Merlin Rothfeld is on the left and John O’Donnell is on the right.)

“Wealth Taxes Would Sap Innovation”

(p. A1) WASHINGTON — Progressive Democrats are advocating the most drastic shift in tax policy in over a century as they look to redistribute wealth and chip away at the economic power of the superrich with new taxes that could fundamentally reshape the United States economy.

As they compete for the Democratic presidential nomination, Senators Elizabeth Warren of Massachusetts and Bernie Sanders of Vermont have proposed wealth taxes that would shrink the fortunes of the richest Americans. Their plans envision an enormous transfer of money from the wealthy to ordinary people, with revenue from the wealth tax used to finance new social programs like tuition-free college, universal child care and “Medicare for all.”

The wealth taxes under discussion would deal a major blow to the balance sheets of American plutocrats like Jeff Bezos, Bill Gates and Warren Buffett. If the tax that Ms. Warren has called for had been in place since 1982, the net worth of the 15 richest Americans in 2018 would have been half as much, according to two economists who helped develop her plan. The Sanders wealth tax, which was released last week, would have eroded their fortunes even further, to barely one-fifth of their 2018 total.

. . .

(p. A18) But redirecting such vast sums could have unintended effects on the United States economy that go beyond promulgating economic fairness. While Ms. Warren ticks off the social programs that can be funded if the richest Americans pay just 2 cents on every dollar they have above $50 million — a number that is unimaginable to most Americans — skeptics warn of economic stagnation, depressed business confidence and a legal battle that would go to the Supreme Court.

At a conference sponsored by the Brookings Institution in September, N. Gregory Mankiw, a Harvard economist, debated Mr. Saez and Mr. Zucman about the merits of taxing wealth. Mr. Mankiw, the former head of President George W. Bush’s Council of Economic Advisers, offered a searing critique, arguing that a wealth tax would skew incentives that could alter when the superrich make investments, how they give to charity and even potentially spur a wave of divorces for tax purposes. He also noted that billionaires, with their legions of lawyers and accountants, have proven to be experts at gaming the system to avoid even the most onerous taxes.

“On the one hand it’s a bad policy, and then the other thing is it’s a feckless policy,” Mr. Mankiw said.

Left-leaning economists have expressed their own doubts about a wealth tax. Earlier this year, Lawrence Summers, who was President Bill Clinton’s Treasury secretary, warned in an article with Natasha Sarin, a law professor at the University of Pennsylvania, that wealth taxes would sap innovation by putting new burdens on entrepreneurial businesses while they are starting up. In their view, a country with more millionaires is a sign of economic vibrancy.

“Turning the tax code into a vehicle for confronting what some call ‘oligarchic drift’ would undermine business confidence, reduce investment, degrade economic efficiency and punish success in ways unlikely to be good for the country or even to be appealing to most Americans,” they wrote.

For the full story, see:

Alan Rappeport and Thomas Kaplan. “For or Against, Taxing the Rich Rouses Passion.” The New York Times (Wednesday, October 2, 2019): A1 & A18.

(Note: ellipsis added.)

(Note: the online version of the story has the same date as the print version, and has the title “Democrats’ Plans to Tax Wealth Would Reshape U.S. Economy.”)

The “article” by Sarin and Summers, mentioned above, is:

Sarin, Natasha, and Lawrence H. Summers. “Fair, Comprehensive Tax Reform Is the Right Path Forward.” Entry on larrysummers.com, March 29, 2019. http://larrysummers.com/2019/04/01/fair-comprehensive-tax-reform-is-the-right-path-forward/ .

Amazon Has 30,000 Open Permanent Jobs, and Half “Are Tech Oriented”

(p. A1) SEATTLE — Engineers in the Bay Area. Advertising managers in Chicago. Freight specialists in Arizona. The job listings keep piling up at Amazon, a company that is growing in many directions amid one of the tightest labor markets in memory.

On Monday [Sept. 9, 2019], Amazon said it had 30,000 open positions in the United States, including full- and part-time jobs at headquarters offices, technology hubs and warehouses.

Although the company has positions to fill across the country, Amazon’s job boards list many more openings in the Seattle area and California and by its new campus near Washington, D.C., than it does anywhere else.

The vacancies, which Amazon said it hoped to fill by early next year, are permanent jobs and do not include seasonal positions for the warehouse workers and drivers that the company typically hires to handle the spike in orders it gets around Christmas. More than half the jobs are tech oriented, and roughly a quarter are for warehouse work, the company said.

For the full story, see:

Karen Weise. “Amazon’s Work Force Has 30,000-Job Hole.” The New York Times (Tuesday, September 10, 2019): B3.

(Note: bracketed date added.)

(Note: the online version of the story has the date September 9, 2019, and has the title “Amazon Has 30,000 Open Jobs. Yes, You Read That Right.”)

Chagnon Documented Violence Among Hunter-Gathering Tribe

(p. B12) In his paper “Life Histories, Blood Revenge, and Warfare in a Tribal Population,” published in the journal Science in 1988, Dr. Chagnon — though the surname is French, his family used an Anglicized pronunciation, SHAG-non — asserted that tribal societies were not typically peaceful, challenging a widespread view.

Anthropologists go wrong, he wrote, when they ignore evidence that aggression among men in tribal societies is so highly rewarded that it becomes an inherited trait.

Yanomami life was one of “incessant warfare,” he wrote. His data, collected over decades, he said, showed that 44 percent of Yanomami men over 25 had participated in killing someone, that 25 percent of Yanomami men were killed by other Yanomami men, and that men who killed were more highly esteemed and had more wives and children than men who did not.

Dr. Chagnon dismissed as “Marxist” the widespread anthropological belief that warfare in tribal life was usually provoked by disputes over access to scarce resources.

“The whole purpose and design of the social structure of tribesmen seems to have revolved around effectively controlling sexual access by males to nubile, reproductive- age females,” he wrote in his 2014 memoir, “Noble Savages.”

For the full obituary, see:

Cornelia Dean. “Napoleon Chagnon, 81, Anthropologist in Amazon Whose Work Drew Criticism.” The New York Times (Tuesday, October 1, 2019): B12.

(Note: the online version of the obituary has the same date as the print version, and has title “Napoleon Chagnon, 81, Controversial Anthropologist, Is Dead.”)

The 2014 memoir mentioned above, is:

Chagnon, Napoleon. Noble Savages: My Life among Two Dangerous Tribes–the Yanomamo and the Anthropologists. New York: Simon & Schuster, 2013.

New York City Regs Force Arthritic Woman to Push Cart to Laundromat Instead of Using Her Laundry Room

(p. A1) When Jean Harrow got a ticket in 2016 for unauthorized renovations to her Queens home, she thought it was a misunderstanding. Yes, she had put a powder room in her basement without realizing she needed a permit. But surely, she said, she wasn’t responsible for the washer and dryer a previous owner had installed downstairs — illegally, according to the $1,600 citation. She would simply explain that at her hearing.

As she waited to do just that, Ms. Harrow got a second ticket — for “failure to comply” with the first. In the 14 months after the original citation, she received five others for the same issue: $15,600 in additional fines. Each meant another hearing, and although she never missed a court date, the tickets kept coming.

Thousands of small property owners in New York City have been hit with a similar pileup of fines, an unintended result of a decade-long crackdown set off by fatal construction accidents. In recent years, the city’s Buildings Department has hired hundreds of new inspectors and doled out harsher penalties for violators. But rules introduced as a safeguard have become a costly trap for ordinary people, The New York Times found.

. . .

(p. A23) Ms. Harrow admits she made a mistake: She should have sought a permit to install the toilet and sink that piggybacked on plumbing already in her laundry room. But, she said she told the inspector, “I didn’t run those pipes — I bought it like this.”

To correct the violation, Ms. Harrow needed to have the unauthorized plumbing removed. Before she could get the permit, however, she had to pay a $1,500 civil penalty.

Pulling the money together took months. The receipt for the payment was lost, then found. Her permit request was rejected several times, because of errors a plumber had made on the application. She received another fine during this period.

At Ms. Harrow’s final hearing, the agency lawyer reduced two fines imposed after the permit came through. But Ms. Harrow was on the hook for the rest. Besides losing the bathroom, she would be out $13,100 in fines plus interest, as well as permit costs, plumbers’ fees, two taxi fares, and a washer and dryer. A different permit would have allowed her to keep the laundry room, but the process would have been even more expensive.

“Now I have to be pushing a cart to go to the wash,” she said. “I have rheumatoid arthritis.”

Ms. Harrow said she tried to put $50 a month toward the fines. “But sometimes, to tell you the truth, I can’t make it.”

For the full story, see:

Grace Ashford. “Snowballing Tickets Bury Homeowners in Debt.” The New York Times (Monday, September 9, 2019): A1 & A22-A23.

(Note: ellipsis added.)

(Note: the online version of the story has the same date as the print version, and has the title “The Law Was Aimed at Deadly Machinery. It Hit Her Washer.”)

California Anti-Gig-Worker Regulations Have “Unintended Victims”

(p. B1) SAN FRANCISCO — After months of bickering over who would be covered by a landmark bill meant to protect workers, California legislators passed legislation on Wednesday [Sept. 11, 2019] that could help hundreds of thousands of independent contractors become employees and earn a minimum wage, overtime pay and other benefits.

. . .

In California, religious groups said they feared that small churches and synagogues would not be able to afford making pastors and rabbis employees. Winemakers and franchise owners said they were worried they could be ensnared by the law, too. Even some of the contractors for the app-based businesses that have been at the center of this debate said the change could hurt them if companies like Uber, Lyft and DoorDash decided to restrict how often they could work or cut them off entirely.

. . .

(p. B4) Small vineyard owners are concerned that they could be forced to directly employ the independent truckers they use to haul their harvests and become responsible for providing insurance and workers’ compensation. Currently, truckers operate as contractors, with their own rigs and insurance, and serve several vineyards, said Michael Miiller, director of government relations at the California Association of Winegrape Growers.

“Our members are growers, not trucking companies,” Mr. Miiller said. “The target of legislators is Uber and Lyft, but the unintended victims are small, independent vineyards on the coast of California.”

Saunda Kitchen owns a Mr. Rooter plumbing business in Sonoma County that has 30 employees, for whom she pays payroll taxes and provides the various mandated benefits. But Ms. Kitchen said she believed that she herself would have to become an employee of Mr. Rooter under the new law, which could cause the parent company to pull out of the state.

“I wouldn’t have access to new technology, training, help with marketing,” said Ms. Kitchen, who planned to talk with Mr. Rooter officials on Thursday [Sept. 12, 2019] about how to proceed.

For the full story, see:

Kate Conger and Noam Scheiber. “Gig-Worker Law Sows Confusion and Defiance.” The New York Times (Thursday, September 12, 2019): B1 & B4.

(Note: ellipses, and bracketed dates, added.)

(Note: the online version of the story has the date Sept. 11, 2019, and has the title “California’s Contractor Law Stirs Confusion Beyond the Gig Economy.”)