Category: Government

Americans Today “Are Far Less Likely” to Trust the Government than 40 Years Ago

(p. A16) . . . Suzanne Mettler, a political scientist at Cornell University [was] perplexed by the trends that Americans have come to dislike government more and more, even as they have increasingly relied on its assistance through programs other than welfare. Americans are far less likely today than 40 years ago to say in surveys that they trust the government to do what is right or to look out for people like them.
. . .
People who strongly dislike welfare were significantly less likely to feel government had provided them with opportunities, or to feel government officials cared what they thought, . . .
“Their attitudes about welfare end up being a microcosm for them of government,” Ms. Mettler said. “They look at how they think welfare operates, and if they see that as unfair, they think: ‘This is basically what government is. Government does favors for undeserving people, and it doesn’t help people like me who are working hard and playing by the rules.’ “

For the full commentary, see:
Emily Badger. “The Outsize Hold Of the Word ‘Welfare’ On the Public’s Mind.” The New York Times (Tuesday, Aug. 7, 2018): A16.
(Note: ellipses, and bracketed word, added.)
(Note: the online version of the commentary has the date Aug. 6, 2018, and has the title “The Outsize Hold of the Word ‘Welfare’ on the Public Imagination.” The page of my National Edition was A16; the online edition says the page of the New York Edition was A14.)

Mettler’s research is more fully described in:
Mettler, Suzanne. The Government-Citizen Disconnect. New York: Russell Sage Foundation, 2018.

Swedish Welfare Paid for by “the Highest Personal Income Tax Rate in the World”

(p. A17) American liberals sometimes hold up Sweden as a model of social order, equality of the sexes, and respect for parental responsibilities. Its welfare state offers excellent free or subsidized prenatal care, 480 days of paid leave for both natural and adoptive parents, and additional leave for moms who work in physically strenuous jobs. Swedish parents have the option to reduce their normal hours (and pay) up to 25% until a child turns 8.
But all this assistance comes at a steep cost. At 61.85%, Sweden has the highest personal income tax rate in the world. That money pays for the kind of support many American women would welcome, but it comes with pressure on women to return to the workforce on the government’s schedule, not their own. The Swedish government also supports and subsidizes institutionalized day care (they call it preschool), promoting the belief that professional care-givers are better for children than their own mothers.
If a mother decides she wants to stay at home with her child beyond the state-sanctioned maternity leave, she receives no additional allowance. That creates an extreme financial burden on those families, and the pressure is social as well. A 32-year-old friend told me that she was in the park with her 2-year-old son, when she was surrounded by a group of women who berated her for not having the boy in day care.

For the full commentary, see:
Erica Komisar. “The Human Cost of Sweden’s Welfare State; A group of women berated my friend in a public park because her 2-year-old son wasn’t in day care.” The Wall Street Journal (Saturday, July 12, 2018): A17.
(Note: the online version of the commentary has the date July 11, 2018.)

Central Banks Epitomize the Administrative State

(p. A15) The promise of the modern central bank is that it will make its corner of the economic-policy world technocratic and academic–in a word, boring.
The lesson of the past decade is that this promise is a lie. The developed world’s four major central banks–the Fed, the Banks of England and Japan, and the European Central Bank–have executed a series of extraordinary policy maneuvers to rescue us from the 2008 financial panic, with debatable success. These include ultralow or negative interest rates; the purchase of sovereign debt in mind-boggling quantities; forays into commercial debt, equity and real-estate markets; and ventures into mortgages, small-business loans and other similar instruments. Central banks have also taken on vast new supervisory powers over the financial system. Each of these measures has had profound effects on our economies: debtors win, savers lose; large, bond-issuing companies get credit, smaller firms don’t; owners of assets accumulate wealth, wage earners see their salaries endangered by inflation. Such distributional choices are normally left to elected leaders, but no one elects a central bank.
Mr. Tucker reminds us how this happened. He places the development of modern central banking firmly within the wider story of administrative governance in the 20th century and its expansion at the expense of electoral accountability. “Central banks might well be the current epitome of unelected power,” he writes, “but they are part of broader forces that have been reshaping the structure of modern governance.” His brief account of the Fed’s history starts not at the usual spot–the 1907 panic and its aftermath–but with the creation of the Interstate Commerce Commission, in 1887, taken by some as the first step in the development of America’s modern bureaucracy.

For the full review, see:
Joseph C. Sternberg. “BOOKSHELF; ‘Unelected Power’ Review: Monetary Mavericks; The question is not whether recent interventions by central banks were effective, but whether they were legitimate.” The Wall Street Journal (Thursday, June 28, 2018): A15.
(Note: the online version of the review has the date June 27, 2018, and has the title “BOOKSHELF; ‘Unelected Power’ Review: Monetary Mavericks; The question is not whether recent interventions by central banks were effective, but whether they were legitimate.”)

The book under review, is:
Tucker, Paul. Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State. Princeton, NJ: Princeton University Press, 2018.

Ridiculed Nathan Myhrvold Perseveres on Asteroids and Is Vindicated

Nathan Myhrvold has also been ridiculed on his entrepreneurial patent clearinghouse (called Intellectual Ventures), and on his geoengineering solution to global warming.

(p. D1) Thousands of asteroids are passing through Earth’s neighborhood all the time. Although the odds of a direct hit on the planet any time soon are slim, even a small asteroid the size of a house could explode with as much energy as an atomic bomb.

So scientists at NASA are charged with scanning the skies for such dangerous space rocks. If one were on a collision course with our planet, information about how big it is and what it’s made of would be essential for deflecting it, or calculating the destruction if it hits.
For the last couple of years, Nathan P. Myhrvold, a former chief technologist at Microsoft with a physics doctorate from Princeton, has roiled the small, congenial community of asteroid scientists by saying they know less than they think about these near-Earth objects. He argues that a trove of data from NASA they rely on is flawed and unreliable.
. . .
(p. D4) Dr. Myhrvold’s findings pose a challenge to a proposed NASA asteroid-finding mission called Neocam, short for Near-Earth Object Camera, which would likely cost hundreds of millions of dollars. A congressional committee that controls NASA’s purse strings just included $10 million more in a budget bill for the development of Neocam.
. . .
When Dr. Myhrvold made his initial claims, the Neowise scientists made fun of a few errors like an equation that mixed up radius and diameter.
“It is too bad Myhrvold doesn’t have Google’s bug-finding bounty policy,” Dr. Wright told Scientific American. “If he did, I’d be rich.”
Dr. Mainzer also said at the time, “We believe at this point it’s best to allow the process of peer review — the foundation of the scientific process — to move forward.”
. . .
Earlier this year, Icarus published Dr. Myhrvold’s first paper on how reflected sunlight affects measurements of asteroids at the shorter infrared wavelengths measured by WISE. It has now accepted and posted a second paper last month containing Dr. Myhrvold’s criticisms of the NASA asteroid data.
. . .
When the scientists reported their findings, they did not include the estimates produced by their models, which would have given a sense of how good the model is. Instead they included the earlier measurements.
Other astronomers agreed that the Neowise scientists were not clear about what numbers they were reporting.
“They did some kind of dumb things,” said Alan W. Harris, a retired NASA asteroid expert who was one of the reviewers of Dr. Myhrvold’s second paper.
Dr. Myhrvold has accused the Neowise scientists of going into a NASA archive of planetary results, changing some of the copied numbers and deleting others without giving notice.
“They went back and rewrote history,” he said. “What it shows is even this far in, they’re still lying. They haven’t come clean.”
Dr. Harris said he did not see nefarious behavior by the Neowise scientists, but agreed, “That’s still weird.”
. . .
Dr. Myhrvold said NASA and Congress should put planning for the proposed Neocam spacecraft on hold, because it could suffer from the same shortfalls as Neowise. “Why does it get to avoid further scrutiny and just get money directly from Congress?” he asked.

For the full story, see:
Kenneth Chang. “A Collision Over Asteroids.” The New York Times (Tuesday, June 19, 2018): D1 & D4.
(Note: ellipses added.)
(Note: the online version of the story has the date June 14, 2018, and has the title “Asteroids and Adversaries: Challenging What NASA Knows About Space Rocks.”)

NYC Government Hid Public Housing Lead Paint Violations

(p. A1) The federal government on Monday [June 11, 2018] delivered a withering rebuke of New York City’s housing authority, accusing officials of systematic misconduct, indifference and outright lies in the management of the nation’s oldest and largest stock of public housing.
Federal prosecutors in Manhattan said the authority, which houses at least 400,000 poor and working-class residents, covered up its actions, training its staff on how to mislead federal inspectors and presenting false reports to the government and to the public about its compliance with lead-paint regulations. The failures endangered tenants and workers for years, the prosecutors said, and potentially left more children than previously known poisoned by lead paint in their apartments.
The accusations were contained in an 80-page civil complaint filed against the authority on Monday in federal court by the office of Geoffrey S. Berman, the United States attorney in Manhattan, after a lengthy investigation.
The problems at the authority “reflect management dysfunction and organizational failure,” the prosecutors said, “including a culture where spin is often rewarded and accountability often does not exist.”

For the full story, see:
Benjamin Weiser and J. David Goodman. “Rot, Deception and Danger in Public Housing.” The New York Times (Tuesday, June 12, 2018): A1 & A21.
(Note: bracketed date added.)
(Note: the online version of the story has the date June 11, 2018, and has the title “New York City Housing Authority, Accused of Endangering Residents, Agrees to Oversight.”)

Regulations Support Car Incumbents and Undermine Tesla Profitability

(p. A13) . . . governments everywhere have decided, perversely, that electric cars will not be profitable. In every major market–the U.S., Europe, China–the same political dispensation now applies: Established auto makers effectively will be required to make and sell electric cars at a loss in order to continue profiting from gas-powered vehicles.
This has rapidly become the institutional structure of the electric-car industry world-wide, for the benefit of the incumbents, whether GM in the U.S. or Daimler in Germany. Let’s face it, the political class always had a bigger investment in these incumbents than it ever did in Tesla.
Tesla has a great brand, great technology and great vehicles. To survive, it also needs to mate itself to a nonelectric pickup truck business. . . .
We’ll save for another day the relating of this phenomenon to Mr. Musk’s recently erratic behavior and pronouncements. . . . Keep your eye on the bigger picture–the bigger picture is the global regulatory capture of the electric car moment by the status quo. And note the irony that Tesla’s home state of California was the original pioneer of this insiders’ regulatory bargain with its so-called zero-emissions-vehicle mandate.
Electric cars were going to remain a niche in any case, but public policy is quickly ruling out the possibility (which Tesla needed) of them at least being a profitable niche.

For the full commentary, see:
Holman W. Jenkins, Jr. “BUSINESS WORLD; A Tesla Crackup Foretold; The real problem is that governments everywhere have ordained that electric cars will be sold at a loss.” The Wall Street Journal (Saturday, June 23, 2018): A13.
(Note: ellipses added.)
(Note: the online version of the commentary has the date June 22, 2018.)

Public Housing Segregated Blacks and Created Disincentives for Marriage and Work

(p. 21) Public housing in America was a New Deal innovation, intended not for the poor, but rather for working-class families, those who could afford to pay modest rent if the government provided them with the homes that private builders didn’t during the Depression. The Public Works Administration then built separate projects for white and black tenants.
. . .
With public housing racially isolated, other policies — some misguided but well intentioned, others indefensible — exacerbated the dysfunction. Austen notes that long waiting lists for relatively few units left poor applicants without other options for safe lodging. Compassionate officials addressed the predicament by lowering the income cutoff to qualify for public housing. The Chicago Housing Authority then made space for the poor by evicting working-class families for whom the projects were initially designed. The authority’s executive director told them, “Be proud to move out, so that a lower-income family can have the advantage that you have had.” Public housing’s opponents also demanded the evictions, insisting that those able to afford private accommodations should be barred from public support.
As Austen observes, the policy created a disincentive to marry, because a husband’s wages might render a family ineligible to remain in its home. The result was the segregation of projects by race and by income, concentrating fatherless young men who not only had little access to legitimate employment but lacked working-class role models who knew how to search for it. In the early 1950s, the median income of Chicago’s public housing residents was nearly two-thirds of the citywide average. By 1970, it was barely one-third.
Initially, Cabrini-Green hired residents as maintenance workers. But perversely, when income cutoffs were lowered, holding such jobs made tenants ineligible to remain. With residents themselves no longer responsible for maintenance, projects deteriorated. And with projects now filled with the politically powerless, and with revenue from rent payments falling, government slashed maintenance budgets and turned high rises into slums. In 1977, Cabrini-Green had 19 maintenance workers; two years later, there were six. Nearly half its units were unoccupied because of insufficient staff. Yet for most who remained in the projects, conditions were still superior to those in the overcrowded dwellings from which they had come.
. . .
In an otherwise nuanced book, Austen labels the social workers and officials who vowed to clear slums and house the poor as “do-gooders.” Implicit in his scorn is a hindsight appreciation that, for the poor to thrive, their communities must include working- and even middle-class families. The urbanist Jane Jacobs knew as much, but her “The Death and Life of Great American Cities” was published in 1961, after evictions of working-class public housing residents were already well underway. Until the sociologist William Julius Wilson published “The Truly Disadvantaged,” in 1987, few comprehended the terrible consequences of cleansing urban neighborhoods of the stably employed. In 2018, Ben Austen has illustrated these repercussions; we can now better consider remedies by contemplating the lessons “High-Risers” offers.

For the full review, see:
Richard Rothstein. “Bleak Housing.” The New York Times Book Review (Sunday, April 15, 2018): 21.
(Note: ellipses added.)
(Note: the online version of the review has the date April 13, 2018, and has the title “A New Look at the New Deal’s Legacy of Public Housing.”)

The book under review, is:
Austen, Ben. High-Risers: Cabrini-Green and the Fate of American Public Housing. New York: Harper, 2018.

Canada’s Single-Payer System Causes “Suffering and Deaths of People on Wait Lists”

(p. A17) Canada’s single-payer health-care system, known as Medicare, is notoriously sluggish. But private clinics like Cambie are prohibited from charging most patients for operations that public hospitals provide free. Dr. Day is challenging that prohibition before the provincial Supreme Court.
. . .
People stuck on Medicare waiting lists can only dream of timely care. Last year, the median wait between referral from a general practitioner and treatment from a specialist was 21.2 weeks, or about five months–more than double the wait a quarter-century ago. Worse, the provincial governments lie about the extent of the problem. The official clock starts only when a surgeon books the patient, not when a general practitioner makes the referral. That adds months and sometimes much longer. In November [2017] an Ontario woman learned she’d have to wait 4½ years to see a neurologist.
. . .
Dr. Day’s lawsuit aims to overturn these provisions. It alleges that the government’s legal restrictions on private care are to blame for the needless “suffering and deaths of people on wait lists.” Dr. Day argues that the current system violates citizens’ rights to “life, liberty, and security of the person,” as guaranteed by the Canadian Charter of Rights and Freedoms, the equivalent of the U.S. Bill of Rights.

For the full commentary, see:
Sally C. Pipes. “Single-Payer Health Care Isn’t Worth Waiting For; An orthopedic surgeon challenges Canada’s ban on most privately funded procedures.” The Wall Street Journal (Monday, January 22, 2018): A17.
(Note: ellipses, and bracketed year, added.)
(Note: the online version of the commentary has the date Jan. 21, 2018.)

“NASA as a Bloated and Unimaginative Bureaucracy”

(p. 10) “The Space Barons,” by Christian Davenport, a Washington Post reporter, is an exciting narrative filled with colorful reporting and sharp insights. The book sparkles because of Davenport’s access to the main players and his talent for crisp storytelling.
. . .
One of the first private pioneers was Burt Rutan, a mutton-chopped aircraft designer who regarded NASA as a bloated and unimaginative bureaucracy and in 1982 founded a company called Scaled Composites that designed aircraft so innovative that, as Davenport writes, “it was as if his inspiration came not just from the laws of aerodynamics but from Picasso.” One of his ideas was for a manned aircraft that could reach the edge of space and then fold its wings upward to act as a feather allowing the craft to re-enter the earth’s atmosphere, land on a runway, and be reused. It would become his entry in the Ansari X Prize, which offered $10 million for the first private company that could launch a reusable vehicle to space twice within two weeks.
Rutan attracted two billionaire partners. The first was the Microsoft co-founder Paul Allen, who as a schoolboy in Seattle yearned to become an astronaut but, being nearsighted, realized that was impossible so spent his time coding in the school’s computer room with his friend Bill Gates. Rutan’s second partner was the toothy goldilocked Richard Branson, a thrill-addicted serial adventurer and entrepreneur who was as enthusiastic about publicity as Allen was averse to it. Branson’s personal motto for his company, Virgin, was “Screw it, let’s do it,” which was no longer a guiding principle at NASA, and he created Virgin Galactic with the goal of taking tourists into space. “Paul, isn’t this better than the best sex you ever had?” Branson asked Allen during one test flight as the spaceship climbed higher.
In 2004, Rutan’s craft (with a Virgin logo on its tail) flew twice to space and back to win the X Prize. At the celebration, Rutan took a shot at NASA. “I was thinking a little bit about that other space agency, the big guys,” he said. “I think they’re looking at each other now and saying, ‘We’re screwed.'”
. . .
At the end of 2015, within a month of each other, Musk and Bezos both launched rockets that returned safely to earth and were reusable. For the moment, Musk the hare had darted ahead: His powerful Falcon 9 rocket had lifted a payload into orbit, whereas Bezos’ smaller New Shepard craft had merely gone up into the edge of space and returned. But as happens with scrappy entrepreneurial business competitors, in contrast to government bureaucracies, Bezos and Musk were goading each other on. And unlike the race between the tortoise and the hare, they can both triumph — as can, one hopes, Richard Branson and others.

For the full review, see:
Walter Isaacson. “The Right Stuff.” The New York Times Book Review (Sunday, April 29, 2018): 10.
(Note: ellipses added.)
(Note: the online version of the review has the date April 24, 2018, and has the title “In This Space Race, Jeff Bezos and Elon Musk Are Competing to Take You There.”)

The book under review, is:
Davenport, Christian. The Space Barons: Elon Musk, Jeff Bezos, and the Quest to Colonize the Cosmos. New York: PublicAffairs, 2018.

China Fears It Can Only Walk Forward by Using Keynes

(p. B1) HONG KONG — Wang Shidong and his two partners were still finishing graduate school two years ago when they raised $45 million in less than two months to start a venture capital fund. His wife, an elementary-school teacher in their home village, was “terrified” that he got to manage so much money, Mr. Wang said.
Things are different this year. After three months and visits with more than 90 potential investors all over China, Mr. Wang and his partners raised only $3 million for a second fund. In June, they shut down the firm.
Their fund, East Zhang Hangzhou Investment Management Ltd., was one of nearly 10,000 founded over the past three years amid a technology gold rush powered in part by China’s government-guided economic growth engine. Now they have become the latest sign (p. B2) that China’s engine is slowing down.
“All industries, institutions and individuals are running short of cash,” said Zhang Kaixing, founder and chief executive of an online asset management company in Shenzhen called Jinfuzi, which means “golden ax.” Jinfuzi, which manages over $4.5 billion in assets, is the type of investor that technology funds court.
“Many investors in private equity and venture capital funds want to take their money back,” Mr. Zhang said.
. . .
“In China we believe in Keynesian economics,” said Mr. Zhang, the Jinfuzi chief executive, referring to the economic theory that favors a bigger role for government. “If what’s going on in China were happening in the U.S., it would have been called a recession. But in China, the government will step in to interfere in significant ways.”
Under President Xi, even economics has become a delicate topic. Many people in China are not willing to speak publicly because even economists aren’t allowed to make downward forecasts.
Yet in private conversations, investors, entrepreneurs and economists admit that with the high debt level and a trade war with the United States, the room for government maneuvering is shrinking. The degrees of pessimism vary, but many of them are bracing for a tough ride ahead.
. . .
Venture funds like East Zhang came into existence in part because, starting in 2014, Beijing made innovation and entrepreneurship top priorities. Leaders hoped that start-ups would help elevate China from a manufacturing power to a technology power. Corporations, banks and wealthy individuals fought to give money to venture funds to invest in start-ups.
“We ended up with a lot of dumb money, managed by inexperienced investors,” said Ran Wang, chief executive of the investment bank CEC Capital Group in Beijing.

For the full story, see:
Li Yuan. “Latest Sign of China’s Slowdown: A Technology Cash Crunch.” The New York Times (Tuesday, July 17, 2018): B1 & B2.
(Note: ellipses added.)
(Note: the online version of the story has the date July 16, 2018.)

Chinese Communists Subsidize Ghost Town Construction

(p. C3) In China’s Inner Mongolia province, in the middle of the Gobi desert, row upon row of largely vacant apartment towers line the streets of Kangbashi, a new district of the city of Ordos. Earlier this month, Xu Yongfen and his family moved into one 28-story building. In the hallways there are a few signs of life–tricycles, slippers and pink children’s shoes in front of some doors. But most apartments remain unoccupied, their doors still covered in plastic wrap, and at street level, barren storefronts are visible in all directions. “This area is nearly totally empty,” Mr. Xu says, tapping a cigarette into a bowl of ashes at his dining room table.
The city has spent 14 years planning, erecting and maintaining Kangbashi, which has the distinction of being one of China’s best-known “ghost towns”–gleaming but sparsely populated new urban centers adjacent to older metropolises. Built by the dozen across the country, the new areas reflect–and were meant to accelerate–China’s economic boom. As the country’s growth has slowed, many of them have become serious liabilities, deep in debt, with little prospect of full occupancy anytime soon.
. . .
Many of China’s other ghost towns have yet to figure out how to jumpstart their economies without slipping back into the old pattern of borrowing and building. To become economically viable, some may take 20 or 30 years, or “maybe even forever,” said Zhou Jiangping, a professor of urban planning at the University of Hong Kong. In some cases, Mr. Zhou said, local officials encouraged ambitious plans to advance their own careers: “You see all these empty towns, these areas at the edge of cities. They may symbolize the power of some officials.” Because many of them then move on to other jobs, he said, they didn’t think about ensuring long-term growth.
. . .
Ordos City Investment Real Estate Development Co. recently resumed work on two housing projects that it had set aside five years ago, including Mr. Xu’s complex. “Kangbashi’s real-estate sales improved, so our company decided to restart construction,” said Wang Tianyong, a branch manager, noting that the government’s subsidy program favors new projects.

For the full story, see:
Dominique Fong. “China’s Ghost Towns Haunt Its Economy.” The Wall Street Journal (Saturday, June 16, 2018): C3.
(Note: ellipses added.)
(Note: the online version of the story has the date June 15, 2018.)