Category: Economics

“We’re from the Streets and We Want Change”

(p. A9) CARACAS, Venezuela — On a sunny afternoon, Jorge Millán, an opposition candidate for congress, walked through the narrow streets of a lower-middle-class neighborhood, pressing the flesh in what was once a no man’s land for people like him.

. . .
With the economy sinking under the weight of triple-digit inflation, a deep recession, shortages of basic goods and long lines at stores despite the nation’s vast oil reserves, the opposition has its best chance in years to win a legislative majority.
. . .
“I was a Chavista, but Chávez isn’t here anymore,” said Mr. Omaña, referring to the followers of the former president.
“It’s this guy,” he said, referring to Mr. Maduro. “It’s not the same.”
Mr. Omaña complained about having to stand in long lines to buy food and about the fast-rising prices, saying that for the first time since Mr. Chávez was elected in 1998 he would vote for an opposition candidate.
“Enough is enough,” he said. “We need something good for Venezuela.”
Venezuelan politics was dominated after 1998 by Mr. Chávez and the movement he started, which he called the Bolivarian revolution, after the country’s independence hero, Simón Bolívar. Mr. Chávez died in 2013, and his disciple, Mr. Maduro, was elected to succeed him, vowing to continue Mr. Chávez’s socialist-inspired policies.
. . .
Opposition candidates said one of the biggest surprises of the campaign has been the warm reception they have received in what were once hostile pro-government strongholds.
Carlos Mendoza, 53, a motorcycle taxi driver and former convict who works in the district where Mr. Millán is running, said that he belongs to a group, known as a colectivo, that in the past was paid by the government to help out during campaigns, attend rallies and drive voters to the polls. Such groups were also often used to intimidate opposition supporters.
“They called us again this time,” Mr. Mendoza said. “I told them, ‘No way, you’re not using me again.’ ”
“We’re from the streets,” he said, “and we want change.”

For the full story, see:
WILLIAM NEUMAN. “Venezuela’s Economic Pain Gives Opposition Lift Before Vote.” The New York Times (Sat., DEC. 5, 2015): A9.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 4, 2015, and has the title “Venezuela’s Economic Woes Buoy Opposition Before Election.”)

Affirmative Action Reduces Number of Black Scientists

Malcolm Gladwell, in chapter three of David and Goliath, persuasively argues that science students who would thrive at a solid public university, may be at the bottom of their class at Harvard, and in discouragement switch to an easier non-science major. Gladwell’s argument has implications for affirmative action, as noted by Gail Heriot in the passages quoted below.

(p. A13) . . . , numerous studies–as I explain in a recent report for the Heritage Foundation–show that the supposed beneficiaries of affirmative action are less likely to go on to high-prestige careers than otherwise-identical students who attend schools where their entering academic credentials put them in the middle of the class or higher. In other words, encouraging black students to attend schools where their entering credentials place them near the bottom of the class has resulted in fewer black physicians, engineers, scientists, lawyers and professors than would otherwise be the case.

But university administrators don’t want to hear that their support for affirmative action has left many intended beneficiaries worse off, and they refuse to take the evidence seriously.
The mainstream media support them on this. The Washington Post, for instance, recently featured a story lamenting that black students are less likely to major in science and engineering than their Asian or white counterparts. Left unstated was why. As my report shows, while black students tend to be a little more interested in majoring in science and engineering than whites when they first enter college, they transfer into softer majors in much larger numbers and so end up with fewer science or engineering degrees.
This is not because they don’t have the right stuff. Many do–as demonstrated by the fact that students with identical entering academic credentials attending somewhat less competitive schools persevere in their quest for a science or engineering degree and ultimately succeed. Rather, for many, it is because they took on too much, too soon given their level of academic preparation.

For the full commentary, see:
GAIL HERIOT. “Why Aren’t There More Black Scientists? The evidence suggests that one reason is the perverse impact of university racial preferences.” The Wall Street Journal (Thurs., Oct. 22, 2015): A13.
(Note: ellipsis added.)
(Note: the online version of the commentary was updated on Oct. 21, 2015.)

Heriot’s report for the Heritage Foundation, is:
Heriot, Gail. “A “Dubious Expediency”: How Race-Preferential Admissions Policies on Campus Hurt Minority Students.” Heritage Foundation Special Report #167, Aug. 31, 2015.

Gladwell’s book, mentioned above, is:
Gladwell, Malcolm. David and Goliath: Underdogs, Misfits, and the Art of Battling Giants. New York, NY: Little, Brown and Company, 2013.

“Growing Emphasis on Climate Aid Is Immoral”

(p. A13) . . . aid is being diverted to climate-related matters at the expense of improved public health, education and economic development. The Organization for Economic Cooperation and Development has analyzed about 70% of total global development aid and found that about one in four of those dollars goes to climate-related aid.
In a world in which malnourishment continues to claim at least 1.4 million children’s lives each year, 1.2 billion people live in extreme poverty, and 2.6 billion lack clean drinking water and sanitation, this growing emphasis on climate aid is immoral.

For the full commentary, see:
BJORN LOMBORG. “This Child Doesn’t Need a Solar Panel; Spending billions of dollars on climate-related aid in countries that need help with tuberculosis, malaria and malnutrition.” The Wall Street Journal (Thurs., Oct. 22, 2015): A13.
(Note: ellipsis added.)
(Note: the online version of the commentary was updated on Oct. 21, 2015.)

Consumers Vote “No” on Costly Organic Smoothies “Made of Swiss Chard, Cashew Milk and Himalayan Salt”

(p. D1) As recently as last month, one could hardly throw a lentil in New York City without hitting an Organic Avenue storefront, with its orange banner, stick-figure logo and promise of better living through $9 cayenne-infused lemonade.
Kat Schamens, a yoga teacher and fitness-apparel designer, liked it that way. “I would always think, ‘I can’t wait to go in and get my chickpea soup,’ ” she said.
In mid-October, Ms. Schamens learned that Organic Avenue’s 10 stores had been shuttered and that the company had filed for bankruptcy. “I kind of freaked out,” she said. “I was distraught. I lost my yoga for a minute.”
. . .
(p. D7) The loyalty of devotees like Ms. Schamens and Ms. Kerin notwithstanding, there is an admitted emperor’s new clothes quality to paying $25 for a lunch of vegetable shavings and a smoothie made of Swiss chard, cashew milk and Himalayan salt.
“You can’t get people to crave this food,” the former investor said. “You can’t build a long-term business off what Gwyneth Paltrow likes.”
Some researchers began to publish studies questioning the necessity and safety of juice cleanses. And the fashion world started to feel pushback from nutritionists and eating-disorder activists against its support of juicing in early 2013, after the Council of Fashion Designers of America announced a 50 percent discount for models on Organic Avenue juices during New York Fashion Week.

For the full story, see:
KATHERINE ROSMAN. “How Organic Avenue Lost All Its Juice.” The New York Times (Sun., NOV. 5, 2015): D1 & D7.
(Note: ellipsis added.)
(Note: the online version of the story has the date NOV. 4, 2015.)

Hungry Suffer Due to G.M.O. Bans by Europe’s “Coalition of the Ignorant”

(p. 6) CALL it the “Coalition of the Ignorant.” By the first week of October [2015], 17 European countries — including Austria, Denmark, France, Germany, Greece, Hungary, Italy, the Netherlands and Poland — had used new European Union rules to announce bans on the cultivation of genetically modified crops.
. . .
I have spent time with malnourished children in Tanzania whose families were going hungry because cassava crops were wiped out by brown-streak disease. That was particularly painful because in neighboring Uganda I had recently visited trial plots of genetically modified cassava that demonstrated complete resistance to the virus. The faces of the hungry children come to mind every time I hear European politicians boast about their country’s G.M.O. ban and demand that the rest of the world follow suit — as Scotland’s minister did in August.
Thanks to Europe’s Coalition of the Ignorant, we are witnessing a historic injustice perpetrated by the well fed on the food insecure. Europe’s stance, if taken up internationally, risks marginalizing a critically important technology that we must surely employ if humanity is to feed itself sustainably in an increasingly difficult and challenging future. I can only hope that the Continent’s policy makers come to their senses before it is too late.

For the full commentary, see:
MARK LYNAS. “With G.M.O. Policies, Europe Turns Against Science.” The New York Times, SundayReview Section (Sun., OCT. 25, 2015): 6.
(Note: ellipsis, and bracketed year, added.)
(Note: the online version of the commentary was updated on OCT. 24, 2015, and has the title “With G.M.O. Policies, Europe Turns Against Science.”)

FDA Forces Child to Go to London to Get Drug to Fight His Cancer

(p. A15) How far would you go to get a drug that could save your child’s life? Across an ocean? That is exactly what the federal government is forcing some American families with dying children to do.
In 2012, when Diego Morris was 11 years old, he was diagnosed with a deadly cancer in his leg called osteosarcoma. Doctors at St. Jude Children’s Research Hospital in Memphis, Tenn., removed the tumor, but the prognosis was poor. There was a significant risk that even extensive chemotherapy after surgery would not prevent the cancer from returning.
Fortunately, a team of doctors at MD Anderson Cancer Center in Houston and Memorial Sloan Kettering Cancer Center in New York City had developed a revolutionary new drug, mifamurtide (MTP), that can prevent osteosarcoma from coming back. A study by Dr. Eugenie Kleinerman of MD Anderson and Dr. Paul Meyers of Sloan Kettering showed the drug resulted in a 30% reduction in the osteosarcoma mortality rate at eight years after diagnosis.
The drug was approved in 2009 by the European Medicines Agency and is currently the standard of care in Europe, Israel and many other countries. In 2012 it received the prestigious Prix Galien Award, the gold medal for pharmaceutical research and development in the United Kingdom.
MPT was exactly what Diego needed. But there was one problem: The drug was not available in America because the Food and Drug Administration had rejected it, demanding additional studies. That meant that Diego had to travel from Phoenix to London to get the drug he needed to save his life–a drug that was available in almost every industrialized nation and should have been available in the U.S.

For the full commentary, see:

DARCY OLSEN. “Winning the Right to Save Your Own Life; As the FDA dawdles, 24 states pass ‘right-to-try’ laws giving terminally ill patients access to drugs.” The Wall Street Journal (Fri., Nov. 27, 2015): A15.
(Note: the online version of the commentary has the date Nov. 26, 2015.)

Olsen’s commentary is related to her book:
Olsen, Darcy. The Right to Try: How the Federal Government Prevents Americans from Getting the Lifesaving Treatments They Need. New York: HarperCollins Publishers, 2015.

Cuomo Bans the Fracking that Could Revive New York’s Southern Tier

(p. A25) CONKLIN, N.Y. — The main grocery store here was replaced by a Family Dollar store, already faded. The historic front of the town hall, a castle no less, is crumbling, and donations are being solicited. The funds earmarked to strip off the lead paint from the castle’s exterior went instead to clear mold from the basement.
This town of roughly 5,500 residents looks alarmingly like dozens of other towns and cities in New York’s Southern Tier, a vast part of the state that runs parallel to Pennsylvania. Years ago, the region was a manufacturing powerhouse, a place where firms like General Electric and Westinghouse thrived. But over time companies have downsized, or left altogether, lured abroad or to states with lower taxes and fewer regulations.
. . .
In western New York, . . . , Gov. Andrew M. Cuomo, a Democrat, pledged $1 billion in 2012 to support economic development. Since then, he has poured hundreds of millions of dollars into numerous Buffalo-area projects.
The Southern Tier has proved to be a harder fix. It is predominantly rural and lacks a significant population core that typically attracts the private sector.
The region is resource rich, but landowners are angry the government will not let them capitalize on it. Some had pinned their hopes of an economic revival on the prospect of the state’s authorizing hydraulic fracturing, known as fracking; many of them can recite the payment formula gas companies were proposing: $500 a month per acre.
But the Cuomo administration, citing health risks, decided last year to ban the practice, leaving some farmers contemplating logging the timber on their land, a move that could destroy swaths of pristine forest.

For the full story, see:
SUSANNE CRAIG. “Former Hub of Manufacturing Ponders Next Act.” The New York Times (Weds., SEPT. 30, 2015): A20-A21.
(Note: ellipses added.)
(Note: the online version of the story has the date SEPT. 29, 2015, and has the title “New York’s Southern Tier, Once a Home for Big Business, Is Struggling.”)

Hawaiian Culture Changed Swiftly in Century After 1777

(p. C1 & C6) It’s startling just how swiftly change came to Hawaii after Capt. James Cook first sighted the island of Kauai in 1777: In little more than a century, Ms. Moore writes, “a closed and isolated culture, bound by superstition and religious ritual, with no understanding of individual freedom or private property,” had been transformed into “a society of thriving capitalism, Protestant values, and democratic institutions.”

For the full review, see:
MICHIKO KAKUTANI. “Hard Truths in the Past of a Tropical Eden.” The Wall Street Journal (Tues., SEPT. 22, 2015): C1 & C6.
(Note: ellipses added.)
(Note: the online version of the review has the date SEPT. 21, 2015, and has the title “Review: ‘Paradise of the Pacific,’ the Hard Truths of Hawaii’s History.”)

The book under review, is:
Moore, Susanna. Paradise of the Pacific: Approaching Hawaii. New York: Farrar, Straus and Giroux, 2015.

“The Market for Greek Philosophers Has Tightened”

(p. A25) Senator Marco Rubio sent fact-checkers aflutter when he said at the Republican presidential debate on Tuesday that philosophy majors would be better off going into welding. The value of a vocational degree, he argued, was greater than the payoff that comes with contemplating the cosmos.
“Welders make more money than philosophers,” Mr. Rubio said. “We need more welders and less philosophers.”
. . .
On Wednesday [November 9, 2015] Mr. Rubio doubled down on his assertion, sending out a fund-raising email with the subject line “more welders” and calling for the overpriced higher education system to be dismantled.
The argument echoed one he makes frequently on the stump, which the senator admits probably irks some intellectuals: “You deserve to know that the market for Greek philosophers has tightened over the last 2,000 years.”

For the full story, see:

Alan Rappeport. “Philosophers Say View of Their Skills Is Dated.” The New York Times (Thurs., Nov. 12, 2015): A25.
(Note: ellipsis, and bracketed date, added. The last two quoted paragraphs were combined into one paragraph in the print version.)
(Note: the online version of the story has the date Nov. 11, 2015, and has the title “Philosophers (and Welders) React to Marco Rubio’s Debate Comments.”)

Those Who Try Japanese Toilets, Praise Them with “Cultish Devotion”

(p. D12) Last year, Bennett Friedman, who owns a plumbing showroom in Manhattan called AF New York, took a business trip to Milan. On the morning of his return he faced a choice: stop in the bathroom there or wait until he got home. The flight was nine hours. He waited.
The move seems almost masochistic. But in his home and office bathrooms, Mr. Friedman had installed a Toto washlet. To sit upon a standard commode, he said, would be like “going back to the Stone Age.”
“It feels very uncivilized,” he said.
For those who own Japanese toilets, there is a cultish devotion. They boast heated seats, a bidet function for a rear cleanse and an air-purifying system that deodorizes during use. The need for toilet paper is virtually eliminated (there is an air dryer) and “you left the lid up” squabbles need never take place (the seat lifts and closes automatically in many models).
. . .
Most washlet owners, then, are converted after trying one out in the world. At a boutique hotel, say, or on a trip to Asia.
Such was the case with Robert Aboulache. Before he and his family went on a vacation to Japan, he said, friends who had visited the country told him he would love the toilets. “I thought, ‘How great can the toilets be?'” Mr. Aboulache said. “They were amazing. Some have noisemakers to cover up the sound. You can pivot that little sprayer. The water can be heated or not. We got home, and I thought, ‘This is not the same.'”
Three days later, Mr. Aboulache went online and bought a Toto washlet, which he installed in the shared upstairs bathroom of his home in Los Angeles as a surprise for his wife and son.
“We’ve been delighted,” he said. “It’s our favorite toilet.”
. . .
Mr. Friedman, too, is an enthusiastic proselytizer for washlets, in his showroom and out in social situations, something you gather he would do even if he didn’t sell them.
Whenever he talks about their virtues, he said, “I feel like one of the Apostles passing the word of God.”

For the full story, see:
STEVEN KURUTZ. “For Its Devotees, the Seat of Luxury.” The New York Times (Thurs., NOV. 19, 2015): D12.
(Note: ellipses added.)
(Note: the online version of the story has the date NOV. 18, 2015, and has the title “The Cult of the Toto Toilet.”)

Health Care Mandate “Freezes You at a Time When You Need to Be Moving Fast”

(p. B4) When LaRonda Hunter opened a Fantastic Sams hair salon 10 years ago in Saginaw, Tex., a suburb of Fort Worth, she envisioned it as the first of what would eventually be a small regional collection of salons. As her sales grew, so did her business, which now encompasses four locations — but her plans for a fifth salon are frozen, perhaps permanently.

Starting in January, the Affordable Care Act requires businesses with 50 or more full-time-equivalent employees to offer workers health insurance or face penalties that can exceed $2,000 per employee. Ms. Hunter, who has 45 employees, is determined not to cross that threshold. Paying for health insurance would wipe out her company’s profit and the five-figure salary she pays herself from it, she said.
“The margins are not big enough within our industry to support it,” she said. “It’s not that I don’t want to — I love my employees, and I want to do everything I can for them — but the numbers just don’t work.”
. . .
For some business owners on the edge of the cutoff, the mandate is forcing them to weigh very carefully the price of growing bigger.
“There’s kind of a deer-in-headlights moment for those who say, ‘I have this new potential client, but if I bring them on, I have to hire five additional people,'” said Philip P. Noftsinger, the payroll unit president at CBIZ, a financial services provider for businesses. “They’re really trying to assess how much the 50th employee is going to cost.”
. . .
For businesses that use many seasonal, variable-hour or temporary workers, like those in the hospitality industry, simply figuring out how many qualifying employees they have can be a challenge.
“I think companies are going to have to work with their payroll processor for the basic data, and then their accountant or attorney about what certain items mean,” Mr. Prince said.
The expense and distraction of all that paperwork is one of the biggest frustrations for one business owner, Joseph P. Sergio. His industrial cleaning company, Polar Clean, which is based in South Bend, Ind., but dispatches teams nationally, has just under 50 core employees. One of its business lines is disaster restoration, and after a flood or hurricane, its temporary staff balloons.
Mr. Sergio offers health insurance to his permanent staff, but the premiums have risen so quickly that he had to switch to a more restrictive plan, with a higher deductible. He is reluctant to go over the 50-employee line and incur all of the new rules that come with it. That makes bidding for new jobs an arduous and risky exercise.
“I’ve had to pull my controller and a couple of top people to sit and spend days going through this,” he said. “If you ramp up, and it pushes you over 50, there’s all these unknown costs and complicated rules. Are we really going to be able to benefit from going after that opportunity? It freezes you at a time when you need to be moving fast.”

For the full story, see:
STACY COWLEY. “ENTREPRENEURSHIP; Health Care Law Leads Business Owners to Rethink Plans for Growth.” The New York Times (Thurs., NOV. 19, 2015): B4.
(Note: ellipses added.)
(Note: the online version of the story has the date NOV. 18, 2015, and has the title “ENTREPRENEURSHIP; Health Care Law Forces Businesses to Consider Growth’s Costs.”)