Category: Labor Economics

Average Wages in Boom Towns Would Rise “Astounding” $8,775 If Zoning Laws Eased

(p. A13) Though some might expect areas populated by conservatives to be the most exclusionary, it is areas where highly educated liberals live that engage in the worst forms of economically exclusionary housing policy. Researchers writing in the Journal of Experimental Social Psychology in 2018 found that highly educated Americans have comparatively tolerant racial attitudes but hold “negative attitudes toward the less educated.” Americans with different levels of education all have biases, they wrote, but “the targets of prejudice are different.”

Exclusionary housing practices are a linchpin in the architecture of educational inequality in America. Because 73% of American school children attend neighborhood public schools, where you live typically determines the quality of schooling. Most people who are concerned about improving education naturally focus attention on what school boards and state education officials do, but it’s at least as important to focus on what the local and state officials running housing policy are up to.

For sixty years, researchers have found that the economic segregation of students. which is driven by housing policy, shapes educational opportunity even more powerfully than per pupil spending. In Montgomery County Maryland, for example, county officials pursued two strategies for raising the achievement of low-income students. In one program, starting in 2000, the school board spent $2,000 extra per pupil in high-poverty schools. In another, begun decades earlier, the county council enacted an “inclusionary zoning” law that to this day requires builders to set aside a portion of new developments for low-income families. Over time, as Heather Schwartz of RAND found in a 2010 study, what the housing authority did for students cut the math achievement gap between low-income and middle-class students in half, while the school board’s program had much less impact.

Zoning-induced housing costs also prevent workers from moving to places where they can make the highest wages, which is typically in coastal cities. Research shows that this barrier to mobility gravely damages American economic productivity, to say nothing of the aspirations of individuals and families. A 2018 study by Edward Glaeser and Joseph Gyourko, for example, found that “restrictive residential land-use regulation” had a price tag of “at least 2% of national output,” or about $400 billion. A 2019 study by Chang-Tai Hsieh and Enrico Moretti, found that if three high-productivity cities—New York, San Jose and San Francisco—relaxed restrictions on housing supply, more workers could move to them, and average wages nationally would rise an astounding $8,775.

When people do move to higher-wage regions, exclusionary zoning laws often force them to live in the far reaches of metropolitan areas. This means longer commutes, which are associated with higher blood pressure and divorce rates, and more miles on the road, which is bad for the environment.

For the full essay, see:

Richard D. Kahlenberg. “Only Zoning Reform Can Solve America’s Housing Crisis.” The Wall Street Journal (Saturday, June 24, 2023): A13.

(Note: the online version of the essay has the date June 22, 2023, and has the same title as the print version. The sentences in the penultimate paragraph quoted above (mentioning 2018 and 2019 papers) appear in the online, but not in the print, version of the essay.)

The essay quoted above is adapted from the book:

Kahlenberg, Richard D. Excluded: How Snob Zoning, Nimbyism, and Class Bias Build the Walls We Don’t. New York: PublicAffairs, 2023.

The Talented, Wealthy, Ambitious, and Hardworking Vote with Their Feet Against Communist China

(p. B12) Is China reopening to the world or turning inward again?

Many would argue the latter, but in one important way, the country is still going global: Residents appear to be leaving at a faster clip than they have in years, including a significant number of the wealthy and well-educated the nation needs to keep modernizing and investing.

. . .

Rebounding emigration is also striking in the context of a declining overall birthrate, and suggests that Beijing must do far more to convince talent, both domestic and foreign, that China is a good place to put down roots if it wants to avoid a steeper growth slowdown in the years ahead.

. . .

Rising net emigration also mirrors much smaller influxes of foreign talent in recent years—another trend that threatens to slow China’s climb up the technological ladder. Foreign residents of Shanghai and Beijing numbered just 163,954 and 62,812 in 2020, according to official data, down 21% and 42%, respectively, since 2010. The pandemic is clearly a major factor. But given the well-publicized rising tensions between China and the West, slowing growth and the rising risks of detention and investigation for what used to be considered routine business by foreigners in China, a portion of that decrease seems very likely to persist.

For much of the new millennium, China has been a place where the ambitious, hardworking and lucky could often get ahead. But in today’s China—more focused on security and control, less on growth—it is no longer clear how true that really is.

Some people, at least, seem to be voting with their feet.

For the full commentary, see:

Nathaniel Taplin. “HEARD ON THE STREET; China’s Brain Drain Threatens Its Future.” The Wall Street Journal (Thursday, July 6, 2023): B12.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 5, 2023, and has the same title as the print version.)

Affirmative Action Quotas Forced Admission of the Academically Unqualified

(p. A13) As Richard Sander and Stuart Taylor Jr. demonstrated in “Mismatch,” their 2012 book on affirmative action, there are very few black students in the top academic cohorts from which highly selective colleges draw most of their students. Black high-school seniors are one-tenth as likely to be in the top tenth of college applicants nationwide as nonblack applicants. The average black SAT score in 2022 was 926 on a 1600 point scale. The average Asian score was 1229 and the average white score was 1098.

. . .

Harvard’s own research in 2013 showed that the black share of its undergraduate population would drop from 10% to less than 1% if it admitted students according to academic skills only. Harvard has the pick of the black U.S. high-school population, but even it can’t fill its desired quota without double standards.

. . .

The result isn’t a benefit to these students but a burden. Research shows they are more likely to end up in the bottom of their classes, if not to drop out of college and professional education entirely. This academic mismatch doesn’t dispel racial stereotypes; it reinforces them.

For the full commentary, see:

Heather Mac Donald. “Racial Preferences Bred 50 Years of ‘Mismatch’.” The Wall Street Journal (Wednesday, July 11, 2023): A13.

(Note: ellipses added.)

(Note: the online version of the commentary was updated July 10, 2023, and has the title “Affirmative Action Bred 50 Years of ‘Mismatch’.”)

The affirmative action book cited in the passage quoted above is:

Sander, Richard, and Stuart Taylor, Jr. Mismatch: How Affirmative Action Hurts Students It’s Intended to Help, and Why Universities Won’t Admit It. New York: Basic Books, 2012.

“Harvard’s own research” from 2013 mentioned above was reported in Slate in 2018:

Mak, Aaron. “Admitting Bias; Harvard Had Proof Its Admissions Process Was Hurting Asian Americans. How Will Its Dean Explain Why He Did Nothing About It?” slate.com, Oct. 15, 2018.

United Airlines CEO Gave Up on Flying United Airlines

United Airlines had major flight cancellations on Sun., June 25, 2023, on the day we were to fly United through O’Hare airport on our way to a European trip. Stress, exhaustion, chaos. United Airlines chaos continued for days. My brain has not yet totally processed the story quoted below. My gut, on the other hand, wants the CEO of United Airlines to be fired.

(p. B11) United Airlines Chief Executive Scott Kirby apologized for taking a private jet from Teterboro Airport in New Jersey to Denver this week as his airline grappled with widespread weather disruptions.

“Taking a private jet was the wrong decision because it was insensitive to our customers who were waiting to get home,” Kirby said in a statement Friday. “I sincerely apologize to our customers and our team members who have been working around-the-clock for several days—often through severe weather—to take care of our customers.”

A United spokeswoman said Kirby took the flight Wednesday because he was unable to secure a seat on a commercial flight. The company didn’t pay for the private flight, she said.

Wednesday was a hectic day for United: The carrier canceled over 750 mainline flights, according to FlightAware, over a quarter of what it had scheduled. The night before, a long stretch of bad storms in New York led to logjams at the area’s airports, including United’s Newark hub.

Some travelers over the past week have been stranded for days while waiting for space on flights home, in some cases sleeping in the airport. Travelers said they spent hours waiting in line for assistance or to be reunited with checked bags.

For the full story, see:

Alison Sider. “United CEO Apologizes for Flying on Private Jet Amid Airline’s Cancellations.” The Wall Street Journal (Saturday, July 1, 2023): B11.

(Note: the online version of the story was updated June 30, 2023, and has the title “United Airlines CEO Apologizes for Taking Private Jet During Flight Disruptions.”)

Portland Feels “Unsafe” and “There’s Trash Everywhere”

(p. A3) PORTLAND, Ore.—Mark Rogers has made a list of things he misses about Portland—its vegan restaurants, Powell’s bookstore, public transit—and the things he doesn’t—having his things stolen, stepping in human excrement, extreme politics.

The 44-year-old artist moved across the country to Fort Wayne, Ind., last year.

“I don’t want to talk trash about my home city even though there’s trash everywhere,” Rogers said.

. . .

Andrea Lamprecht, 50, a cardiac nurse, said she was chased by a homeless man while out on a jog in her Alameda neighborhood on the east side of Portland, where the median home price hovers around $1 million.

She and her husband, Derek Lamprecht, an orthopedic surgeon, had raised their children in Portland. The chasing incident contributed to the couple’s decision to move to a quiet rural area about 10 miles outside the city in 2021. “It never felt unsafe before,” said Derek Lamprecht. “The character of the city changed.”

For the full story, see:

Zusha Elinson. “Disenchanted Portland Residents Leave the City.” The Wall Street Journal (Thursday, June 29, 2023): A3.

(Note: ellipsis added.)

(Note: the online version of the story has the date June 28, 2023, and has the title “Portland Is Losing Its Residents.”)

Engerman, with Fogel, Courageously Asked Politically Incorrect Questions about Slavery

(p. D8) Stanley Engerman, one of the authors of a deeply researched book that, wading into the fraught history of American slavery, argued that it was a rational, viable economic system and that enslaved Black people were more efficient workers than free white people in the North, died on May 11 [2023] in Watertown, Mass.

. . .

In their two-volume “Time on the Cross: The Economics of American Negro Slavery” (1974), Professor Engerman and Prof. Robert W. Fogel used data analysis to challenge what they called common characterizations of slavery, including that it was unprofitable, inefficient and pervasively abusive.

They said they were not defending slavery. “If any aspect of the American past evokes a sense of shame,” they wrote, it’s the system of slavery.” But much of the accepted wisdom about it, they said, was distorted, or just plain wrong.

“Slave agriculture was not inefficient compared with free agriculture,” they wrote. “Economies of large-scale operation, effective management and intensive utilization of labor made Southern slave agriculture 35 percent more efficient than the Northern system of family farming.”

They insisted that the typical slave “was not lazy, inept and unproductive” but rather “was harder working and more efficient than his white counterpart.” They contended that the destruction of the Black family through slave breeding and sexual exploitation was a myth, and that it was in the economic interest of plantation owners to encourage the stability of enslaved families.

They also wrote that some slaves received positive incentives, such as being elevated to overseers of work gangs, to increase their productivity.

The book attracted a lot of attention, including a rave review by the economist Peter Passell in The New York Times. “If a more important book about American history has been published in the last decade, I don’t know about it,” he wrote. He described the work as a corrective, “a jarring attack on the methods and conclusions of traditional scholarship” on slavery.

. . .

. . . the Marxist historian Eugene D. Genovese, whose own book about slavery, “Roll, Jordan Roll: The World the Slave Made,” was also published in 1974, called “Time on the Cross” an “important work” that had “broken open a lot of questions about issues that were swept under the rug before.”

For the full obituary, see:

Richard Sandomir. “Stanley Engerman, 87, Scholar Who Disputed Views on Slavery, Dies.” The New York Times (Monday, May 29, 2023): D8.

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

(Note: the online version of the commentary was updated May 30, 2023, and has the title “Stanley Engerman, Revisionist Scholar of Slavery, Dies at 87.”)

The book praised in the obituary quoted above is:

Fogel, Robert William, and Stanley L. Engerman. Time on the Cross: The Economics of American Negro Slavery. Boston: Little, Brown and Company, 1974.

“Evaluate an Argument on Its Own Merits, Not on the Race of the Person Making It”

(p. A22) In 1991, Stephen L. Carter, a professor at Yale Law School, began his book “Reflections of an Affirmative Action Baby” with a discomfiting anecdote. A fellow professor had criticized one of Carter’s papers because it “showed a lack of sensitivity to the experience of Black people in America.” When the professor, who was white, learned that Carter was Black, he withdrew the remark rather than defend his claim. It was a reminder to Carter that many people, especially among his fellow establishment elites, had certain expectations of him as a Black man.

“I live in a box,” he wrote, one bearing all kinds of labels, including “Careful: Discuss Civil Rights Law or Law and Race Only” and “Warning! Affirmative Action Baby! Do Not Assume That This Individual Is Qualified!”

This was a book that refused to dance around its subject.

Weaving personal narrative with a broader discussion of affirmative action’s successes and limitations, “Reflections of an Affirmative Action Baby” offered a nuanced assessment. A graduate of Stanford and Yale Law, Carter was a proud beneficiary of affirmative action. Yet he acknowledged the personal toll it took (“a decidedly mixed blessing”) as well as affirmative action’s sometimes troubling effects on Black people as the programs evolved.

. . .

An early critic of groupthink, Carter warned against “the idea that Black people who gain positions of authority or influence are vested a special responsibility to articulate the presumed views of other people who are Black — in effect, to think and act and speak in a particular way, the Black way — and that there is something peculiar about Black people who insist on doing anything else.”

In the past, such ideas might have been seen as “frankly racist,” Carter noted. “Now, however, they are almost a gospel for people who want to show their commitment to equality.” This belies the reality that Black people, he said, “fairly sparkle with diversity of outlook.”

. . .

At the same time, Carter bristled at the judgment of many of his Black peers, describing several situations in which he found himself accused of being “inauthentically” Black, as if people of a particular race were a monolith and that those who deviated from it were somehow shirking their duty. He said he didn’t want to be limited in what he was allowed to say by “an old and vicious form of silencing.”

In an interview with The Times in 1991, Carter emphasized this point: “No weight is added to a position because somebody is Black. One has to evaluate an argument on its own merits, not on the race of the person making it.”

For the full commentary, see:

Pamela Paul. “A 1991 Book Was Stunningly Prescient About Affirmative Action.” The New York Times (Friday, May 26, 2023): A22.

(Note: ellipses added.)

(Note: the online version of the commentary has the date May 25, 2023, and has the title “This 1991 Book Was Stunningly Prescient About Affirmative Action.”)

The book praised in the commentary quoted above is:

Carter, Stephen L. Reflections of an Affirmative Action Baby. New York: Basic Books, 1991.

Government Infrastructure Serves Elite More Than Ordinary Citizens

(p. A1) In a country where major industry and political fortunes alike are often tied to a vast, interwoven rail system, India has lavished public resources on new trains, but its purse strings have been much tighter when it comes to ensuring the safety of those already racing along its tracks.

Those decisions loomed large on Sunday [June 4, 2023] in the aftermath of a devastating train wreck that killed at least 275 people in eastern India.

. . .

Over the past years, India has been polishing its long-ramshackle infrastructure as never before, and its railways, which are at the heart of the world’s fifth-largest economy, have been a prime beneficiary. The government spent almost $30 billion on the rail system during the past fiscal year, up 15 percent from the year before.

But the amount spent on basic track maintenance and other safety measures has been falling. A report last year by India’s auditor general, an independent office, found that less money was being allocated for track renewal work and that officials had not even spent the full (p. A11) amount set aside.

. . .

. . . most of Mr. Modi’s initiatives have been aimed not at the basic steps needed to get trains from Point A to Point B without mishap, but at improving speed and comfort. He regularly extols higher-fare new electric Vande Bharat trains connecting bigger cities and has made an early priority of a Japanese-style bullet train, though it can do nothing to improve the lives of the country’s ordinary passengers.

For the full commentary, see:

Alex Travelli. “Rail Funding In India Put Upkeep Last.” The New York Times (Monday, June 5, 2023): A1 & A11.

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

(Note: the online version of the commentary has the date April 18, 2023, and has the title “Money for Show Horses, Not Work Horses, on India’s Rails.”)

Xi Deflects Focus Away from Economic Stagnation by Telling Youth to “Eat Bitterness”

(p. B1) China’s young people are facing record-high unemployment as the country’s recovery from the pandemic is fluttering. They’re struggling professionally and emotionally. Yet the Communist Party and the country’s top leader, Xi Jinping, are telling them to stop thinking they are above doing manual work or moving to the countryside. They should learn to “eat bitterness,” Mr. Xi instructed, using a colloquial expression that means to endure hardships.

Many young Chinese aren’t buying it. They argue that they studied hard to get a college or graduate school degree only to find a shrinking job market, falling pay scale and longer work hours. Now the government is telling them to put up with hardships. But for what?

“Asking us to eat bitterness is like a deception, a way of hoping that we will unconditionally dedicate ourselves and undertake tasks that they themselves are unwilling to do,” Ms. Li said.

. . .

(p. B4) A record 11.6 million college graduates are entering the work force this year, and one in five young people is unemployed. China’s leadership is hoping to persuade a generation that grew up amid mostly rising prosperity to accept a different reality.

The youth unemployment rate is a statistic the Chinese Communist Party takes seriously because it believes that idle young people could threaten its rule. Mao Zedong sent more than 16 million urban youths, including Mr. Xi, to toil in the fields of the countryside during the Cultural Revolution. The return of these jobless young people to cities after the Cultural Revolution, in part, forced the party to embrace self-employment, or jobs outside the state planned economy.

Today the party’s propaganda machine is spinning stories about young people making a decent living by delivering meals, recycling garbage, setting up food stalls, and fishing and farming. It’s a form of official gaslighting, trying to deflect accountability from the government for its economy-crushing policies like cracking down on the private sector, imposing unnecessarily harsh Covid restrictions and isolating China’s trading partners.

Many people are struggling emotionally. A young woman in Shanghai named Ms. Zhang, who graduated last year with a master’s degree in city planning, has sent out 130 résumés and secured no job offers and only a handful of interviews.

. . .

“To ask us to endure hardships is to try to shift focus from the anemic economic growth and the decreasing job opportunities,” said Ms. Zhang, who, like most people I interviewed for this column, wanted to be identified with only her family name because of safety concerns.

. . .

Mr. Xi “talks about the great rejuvenation of the Chinese nation all the time,” said Steven, who graduated from a top U.K. university with a master’s degree in interactive design and has yet to find a job. “But isn’t the rejuvenation about not everyone engaging in physical labor?” Because of the rapid development of robots and other technologies, he said, these jobs are easily replaceable.

. . .

Now after months of fruitless job hunting, he, like almost every young worker I interviewed for this column, sees no future for himself in China.

“My best way out,” he said, “is to persuade my parents to let me run away from China.”

For the full commentary, see:

Li Yuan. “THE NEW NEW WORLD; China’s Grads Struggle to Find Work. Xi Shrugs.” The New York Times (Friday, June 2, 2023): B1 & B4.

(Note: ellipses added.)

(Note: the online version of the commentary was updated June 1, 2023, and has the title “THE NEW NEW WORLD; China’s Young People Can’t Find Jobs. Xi Jinping Says to ‘Eat Bitterness.’”)

Simple Beeping Pagers Tell Patients a Doctor’s Distraction Is Work-Related

(p. A10) Pagers, those pre-cellphone, one-way devices that alert the carrier that someone is trying to reach them, can seem like something out of a time capsule.

. . .

There are people who just refuse to let their pagers go, including some doctors and bird watchers. They say pagers allow them to separate parts of their life in a way phones don’t, and that the lower-tech one-way communication of a pager is less distracting than looking at a phone full of alerts and apps.

. . .

Another advantage of the pager? It’s easy for staff to throw one in frustration instead of turning on each other, according to Dr. Colm McCarthy, an orthopedic surgeon in Fall River, Mass.

Tired during a busy on-call night once, he chucked his pager in a closet where it broke.

He gave up his pager when he got his current job, and transitioned over to the apps on his phone. Now, though, when he gets a message on his phone, it’s awkward to answer it, he says. If he’s looking at the phone, he worries patients might wonder what he’s paying attention to while with a pager, it’s obvious it’s work.

He has multiple apps on his phone. Last year, his hospital adopted the fourth app that connects him to patients. When a patient wants to reach him, he gets a message with a phone number. He then has to call that number to get a message with the patient’s phone number.

The mute function on the apps is easily overridden by alerts, so to separate work from home life, he keeps his phone on silent altogether, he says. He often misses messages from family and friends because of that.

For the full story, see:

Ariana Perez-Castells. “What the Beep? Die-Hards Refuse to Let Go of Their Pagers.” The Wall Street Journal (Monday, May 20, 2023): A1 & A10.

(Note: ellipses added.)

(Note: the online version of the story has the date May 19, 2023, and has the same title as the print version.)

Instead of Ending Poverty, Chinese Communists End Free Speech About Poverty

(p. A1) A heartbreaking video of a retiree that showed what groceries she could buy with 100 yuan, or $14.50 — roughly her monthly pension and sole source of income — went viral on the Chinese internet. The video was deleted.

A singer vented the widespread frustration among young, educated Chinese about their dire finances and gloomy job prospects, like gig work. “I wash my face every day, but my pocket is cleaner than my face,” he sings. “I went to college to help rejuvenate China, not to deliver meals.” His song was banned and his social media accounts were suspended.

. . .

Hu Chenfeng recorded the footage that was removed from the Chinese internet. On popular video sites, he had posted a recording showing an elderly woman living on barely $15 a month. In the words of many social media commenters, he was revealing too much. “This subject is untouchable,” one commenter wrote on a now-deleted discussion thread on Zhihu, a site similar to Quora. Another wrote, “His account was censored simply because he showed what life is like for many people.”

In the video, which survives outside the Chinese internet on YouTube, Mr. Hu interviews the woman, a 78-year-old widow, on the street in the southwestern city of Chengdu. She said she planned to buy only rice, about the only thing she could afford. She hadn’t eaten meat for a long time. Tears rolled down her cheeks as she recounted her financial hardship. The two walk through a grocery store. They bought rice, eggs, pork and flour. The bill came to 127 yuan ($18). Mr. Hu insisted on paying.

He was emotional, too, signing off with “a heavy heart.”

The video was removed from the two biggest user-generated video platforms in China. Mr. Hu’s accounts were suspended.

For the full commentary, see:

Li Yuan. “THE NEW NEW WORLD; China Is Deleting Poverty, One Video at a Time.” The New York Times (Monday, May 8, 2023): A1 & A6.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date May 4, 2023, and has the title “THE NEW NEW WORLD; Why China’s Censors Are Deleting Videos About Poverty.”)