Tagg, you’re it

An April NYT story about Tagg Romney’s private equity firm illustrates two points:

  • How the 1% becomes an entrenched aristocracy.
  • How subtly political corruption works.

Tagg is Mitt’s oldest son. Right after Mitt’s 2008 presidential campaign folded its tent, Tagg, a lawyer, and Romney-for-President finance director Spencer Zwick used the campaign’s rolodex of big-money contributors to start Solamere Capital — which describes itself as

A small number of families with broad networks joined together to aggregate their access to top-tier private equity firms, proprietary deal flow, and unparalleled management resources and expertise.

The strategy page of Solamere’s web site has seven bullet points, six of which begin with the word access. The gist: We know the right people, so we get offered deals that ordinary Joes never hear about.

Only the lawyer had any previous experience in private equity, but between the Romney name, the campaign donor list, and an early $10 million investment from Mitt himself, they have raised $244 million from 64 investors and made $16.8 million in fees.

Zwick was simultaneously raising capital for Solamere and PAC money for Mitt Romney’s Free and Strong America — often from the same people. All perfectly legal. Did any of those investors see the son’s company as a way to get in good with the father, a possible future president? Was anybody looking down the road far enough to anticipate Tagg continuing the Romney political dynasty? We’ll probably never know.

George W. Bush’s pre-politics career is a similar story: Contributors to his father’s campaigns repeatedly opened doors for him and invested in his businesses. Was that corruption? Or just helping out a nice young man from a good family?

It seems not to have been classic quid-pro-quo corruption. Nobody has identified any particular favor that the Bushes, senior or junior, did in exchange for junior’s opportunities. But this is one more example of the Washington gift economy. Lobbyist A doesn’t buy the vote of Congressman B; he just does nice things for B, thereby establishing a lasting relationship in which A and B will continue to be nice to each other without breaking any laws. Win/win.

So far, both Solamere and its investors seem to be winning. The firm has made 20% per year for the last two years. (Investments in general have also been up these last two years, though, so it’s hard to say how impressive that is without knowing more. Solamere might get those returns via a high risk/high reward strategy that will burn them in down years.)

But that raises another question: Did Solamere make money because they were cut in on lucrative deals, again, by people who wanted to get in good with a possible future president? Similar suspicions dogged George W. Bush. (The most controversial incident was when Bush Jr.’s company Harken Energy got a surprising contract from Bahrain while Bush Sr. was president, though a WaPo reporter called implications of influence-peddling  “baseless”.) Questions were also raised about the profit Hillary Clinton made in commodity-trading while her husband was governor. (Like everything else about the Clintons, this was investigated to the Nth degree and no charges were brought.)

But even if you assume that everything in Tagg Romney’s career is above board and 100% honest, this is still a story about how the aristocracy reproduces. Tagg hasn’t inherited any of his parents’ hundreds of millions yet. And maybe he never will. Mitt claims he gave away his inheritance from his millionaire/auto-executive/governor father because he and Ann already had “enough of our own”. (Though he did get through school by selling stock his father had given him.)

Tagg is getting rich “on his own” too. Someday he also may claim to be a self-made man, and dismiss his critics as just “envious” of his “success“.

May 28, 2012 – 12:32 pm Categories: Articles | Comments (3)

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Slinging Mud at Clean Energy and other short notes

For years, the worst thing you’d hear about wind, solar, and biofuels was that they were impractical; fun to dream about, but when you got serious about energy you’d come back to fossil fuels. Now, though, as more and more farmers plow around the windmills in their fields and businesses and homeowners see real savings from the solar panels on their roofs, the dirty-energy industries realize they’re going to have to get nastier.

The Guardian recently published an internal memo from the American Traditions Institute (a shadowy non-profit apparently funded by the fossil-fuel industry) planning (as the Checks and Balances Project put it) “a coordinated national disinformation campaign against wind energy”.

Among its main recommendations, the proposal calls for a national PR campaign aimed at causing “subversion in message of industry so that it effectively becomes so bad that no one wants to admit in public they are for it.”

ATI denies that the memo is official — no conspiracy, just an ATI senior fellow acting as a lone gunman — but adds “we would be pleased to be part of any education campaign to inform the public about the problems with expensive, unreliable wind energy”.

Put this together with the efforts to manufacture a scandal out of the Solyndra bankruptcy, the twisting of research to claim that windmills actually cause global warming, and congressional Republicans’ attempt to end the Pentagon’s bio-fuels projects. (Some Democrats on the Senate Armed Services Committee must have sided with Republicans in a closed-session 13-12 vote agreeing with the House.) It’s looking like alternative energy is about to join global warming in the culture wars: If you believe that clean energy is actually clean and provides energy, you must be one of those radical Marxists.

This Memorial Day, I’m proud of Vice President Biden. Speaking to a group of family members of fallen American troops, Biden recalled the day he heard that his wife and daughter had been killed in a car accident.

For the first time in my life I understood how someone could consciously decide to commit suicide. Not because they were deranged, not because they were nuts, but because they’d been to the top of the mountain, and they just knew in their heart that they’d never get there again. …

There really is hope. … I promise you (and you parents as well) when the thought of your son or daughter or your husband or wife brings a smile to your lips before it brings a tear to your eye — it will happen. … The only thing I have more experience than you in is this: I’m telling you, it will come.

On the surface, it looked like President Obama was doing nothing substantial for same-sex marriage: He said he favors it personally, but that it should be a state issue rather than an action item for his administration.

Sometimes, though, that bully-pulpit thing really works. It’s not obvious how much influence Obama’s statement had on the NAACP passing a resolution framing marriage equality as an “equal protection under the law” issue, but between the two of them, they seem to have dramatically shifted the opinion of the African-American community.

Middle Class Economist observes: “Romney to Replace Obamacare with…Essentially Nothing”

Mitt Romney seems to think that criticizing his record as a vulture capitalist is the same as criticizing the free enterprise system.

Grist calls attention to the way the fossil-fuel industry games the academic system. A fracking-is-getting-safer report from the University of Buffalo actually came from somewhere else:

Large chunks of the report appear to be lifted verbatim from a document previously published by three of the report’s four authors for a conservative think tank called the Manhattan Institute. This matters because the university study fails to cite the think tank. In this case, it’s very relevant: The Manhattan Institute receives financial support from oil and gas companies heavily invested in fracking, like ExxonMobil. Instead, the study released this month is stamped only with the University of Buffalo’s academic imprimatur.

Kevin Connor, director of the Public Accountability Initiative, put it bluntly:

The report’s inaccurate and biased analysis and the authors’ conflicts of interest suggest that the University at Buffalo is being used as an academic front for gas industry misinformation, rather than as a venue for independent, informative analysis.

I’ve talked about this kind of thing in more detail before. There needs to be a name for it, preferably something related to money laundering: information laundering? research laundering? I’m still working on it.

May 28, 2012 – 12:02 pm Categories: Short Notes | Comments (3)

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Market Society

A market economy is a tool—a valuable and effective tool—for organizing productive activity. A market society is a way of life in which market values seep into every aspect of human endeavor. It’s a place where social relations are made over in the image of the market. The great missing debate in contemporary politics is about the role and reach of markets. Do we want a market economy, or a market society?

— Michael J. Sandel, “What Isn’t For Sale?” (2012)

In this week’s sift:

  • “If you can’t hear it from me …” — 3 voices that might get through to your conservative friends. A former climate-change denier explains why he stopped denying. A young Christian author tells her elders how their anti-gay focus is causing Christianity to lose her generation. And a successful entrepreneur explains why he isn’t a job-creator, but middle-class consumers are.
  • Citizen of the highest bidder. New FaceBook billionaire Eduardo Saverin didn’t intend to become a symbol when he lowered his tax bill by renouncing his American citizenship. But right and left alike seized on his example to make points about taxes, patriotism, and whether anything is truly priceless.
  • 196 People and other short notes. 196 individuals dominated Super-PAC funding in 2011. Austerity flounders in Europe. Harp seals should get jobs. Easter Island heads have buried bodies. Yet another similarity between the Taliban and Pat Robertson. And more.
  • Book recommendation of the week: The New Religious Intolerance by Martha Nussbaum. For a bona fide University of Chicago philosopher, Nussbaum has a readable, engaging style. This short book looks at the fear-psychology that religious intolerance is based on, briefly presents the major philosophical theories of tolerance, illustrates how those ideas have played out historically, and then brings it all together to look at current anti-Muslim activism in both the U.S. and Europe.
  • Last week’s most popular post. Everybody will support same-sex marriage by 2030 got 381 views. The most-clicked link was the iSideWith.com election quiz.
  • What you can do. From time to time I’ve mentioned the Banyan Project (where I’m on the unpaid Board of Advisors; so is Dan Gillmor, author of We the Media). My friend Tom Stites has come up with a business plan for launching local news co-ops, whose loyalty will be to their reader/owners rather than to the advertisers. Banyan has reached the pilot-project stage, and is looking for start-up money through the journalism crowd-source funding site spot.us. Spot.us works by an interesting model: It uses crowd-sourcing to fund journalism that the for-profit media won’t do. You pledge money via your credit card, and that money is committed to spot.us projects in general. But your spot.us credits only go to the proposal if it meets its funding goal within the specified time period. (So your money doesn’t vanish into projects that never get off the ground. Otherwise you retain spot.us credits to invest in another project.) The Banyan proposal speaks for itself. You can decide for yourself whether it’s the kind of thing you want to support. I’ll vouch for Tom Stites (who used to be my editor at UU World) and for spot.us itself. Neither is a scam. I made a pledge this morning.
May 21, 2012 – 1:40 pm Categories: Weekly summaries | Comments (4)

“If you can’t hear it from me …” — 3 voices that might get through to your conservative friends

If you’re a liberal who has any conservative friends or relatives, you know how well defended they are against anything you might say. Any fact you know is wrong. Any source you might quote is biased: Academia is biased (except for institutes funded by the Koch Brothers). Major newspapers are biased (except for the Washington Times). TV news is biased (except for Fox). Government agencies are biased (unless a Republican president has had their reports vetted by a political appointee) … and so on.

Here are three points of view that might sneak under the conservative radar, because of where they come from and how they’re pitched.

Now let’s look at those one-by-one.

BYU’s Barry Bickmore on climate-change denial. Bickmore’s talk isn’t about climate change. It’s about “How to Avoid the Truth about Climate Change“. (If you don’t have time to watch, scroll down the comments to Anna Haynes’ notes on the talk.) In other words: What techniques make it possible for honest and intelligent people to deny something that virtually all the experts in the field believe?

Bickmore knows why people don’t believe in climate change, because he used to agree with them on two points: There’s lot’s of scientific controversy about global warming, and the is theory based solely on complex computer models which are easy to screw up.

When he looked into the issue more closely, though, Bickmore discovered that each of those points is wrong: Around 97% of actively publishing climate scientists believe that human activity is causing the planet to get hotter, and their opinion is verified by a variety of techniques that may not give exactly the same projections, but do agree within the bounds of the published error estimates.

He wondered: Why didn’t I already know that? What led to my confusion?

First, there were those “thousands of scientists doubt global warming” articles. Bickford explains the strategy that generates them: First, expand the field of “experts” to include a lot of people who aren’t really experts at all, and second, report a raw number that sounds big rather than doing a poll and getting a percentage.

So the Oregon Petition (claiming there is “no convincing scientific evidence” of human-caused global warming) claims 30,000 signers. But signers don’t have to be experts or even scientists. They need only have a bachelors degree, not necessarily in a relevant field.

So why is this impressive to people — 30,000 scientists? … People think about scientists as “Well, you know science, so why don’t you tell me?” Right? But in reality we’re much more specialized than that. If you have cancer, you don’t go to your podiatrist. You go to your oncologist.

Ditto for the 900 peer-reviewed journal articles skeptical of climate change. It sounds like a big number, but in what universe of journals? Apparently, a universe big enough to include journals that publish “research” articles on dog astrology and UFO abductions.

Bickford continues, similarly destroying the “What about Galileo?” and “We don’t need experts” objections, leading to this conclusion:

There’s always room for doubt. But there has to be a point — if we’re going to make any attempt at all at trying to be objective — that we have to admit that we’re trying too hard [to avoid the truth]. And I think that for people who are on the side I was a few years ago, I think we should admit that we’ve reached that point.

Rachel Held Evans on the damage Christianity is suffering from the culture wars. After reviewing some research showing how young adults (even those raised in Christian households and even young church-goers) view Christianity’s anti-gay image negatively and are shamed by what they see as un-Christ-like hostility towards their gay and lesbian friends, Evans gives her personal observations. When she speaks at Christian colleges, she finds that “every single student I have spoken with believes that the Church has mishandled its response to homosexuality.“

On the evening when North Carolina’s anti-gay Amendment One was passing by a wide margin, Evans saw a pattern in her Twitter feed:

Christians over 40 were celebrating. Christians under 40 were mourning. Reading through the comments, the same thought kept returning to my mind as occurred to me when I first saw that [pro-amendment] Billy Graham ad:

You’re losing us.

I’ve said it a million times, and I’ll say it again…(though I’m starting to think that no one is listening):

My generation is tired of the culture wars.

Back when gays were in the closet, you could make them out to be any kind of hobgoblins you wanted. All the scary talk about a “gay agenda” depends on that image: sinister conspirators out to destroy everything good and decent in the world.

But to folks under 40, gays and lesbians are their friends from high school. They decorated homecoming floats together and washed cars side-by-side to raise money to send the French Club to Paris.

We know too many wonderful people from the LGBT community to consider homosexuality a mere “issue.” These are people, and they are our friends. When they tell us that something hurts them, we listen.

Evans says her generation wants to “stop waging war and start washing feet”. Translating for those who don’t speak Christian: They want to help people rather than beat them down, and practice their religion humbly rather than be authoritarian ideologues. If they can’t do that inside the church, she says, they’ll do it somewhere else.

Nick Hanauer. This guy was an early investor in Amazon, and then made several other piles of money by starting little-fish companies that he eventually sold to bigger fish like Microsoft. In other words: not a communist, not a fifth-generation Rockefeller who has forgotten where his trust fund came from, not an academic economist who has never made or sold anything.

Hanauer’s 6-minute TED talk addresses one question: Who are the job creators? You might expect him to answer, “People like me.” But he doesn’t.

If there was no one around who could afford to buy what we had to sell, all those companies [I helped start] and all those jobs would have evaporated. That’s why I can say with confidence that rich people don’t create jobs. Nor do businesses, large or small.

Jobs are a consequence of a circle-of-life-like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary consumer is more of a job creator than a capitalist like me.

… Anyone who’s ever run a business knows that hiring more people is a course of last resort for capitalists. It’s what we do if and only if rising consumer demand requires it.

After displaying graphs of rising income and falling tax rates for the rich since 1980, he comments:

If it was true that lower taxes for the rich and more wealth for the wealthy led to job creation, today we would be drowning in jobs.

But when the middle class thrives, businesses grow and everyone does better. So he concludes:

In a capitalistic economy, the true job creators are middle-class consumers. And taxing the rich to make investments that make the middle class grow and thrive, is the single shrewdest thing we can do for the middle class, for the poor, and for the rich.

At first, Hanauer’s talk didn’t appear on the TED website — not all of them do — leading National Journal to bill the talk as “too hot for TED“. This prompted a TED official to post “the real story“, claiming that the audience gave the talk mediocre ratings:

a non-story about a talk not being chosen, because we believed we had better ones, somehow got turned into a scandal about censorship.

Even that spin, though, implies that TED and its audience are not very representative. Once the YouTube got out, it quickly went viral and has been seen (so far) by over 400,000 people.

May 21, 2012 – 1:23 pm Categories: Articles | Comments (11)

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Citizen of the highest bidder

When a story is being spun wildly in more than one direction, it’s important to start with facts: One of Facebook’s initial investors, Eduardo Saverin, has renounced his American citizenship in favor of Singapore, where he had already been living as an American ex-patriate. Because Singapore has no capital gains tax, making the switch before Friday’s Facebook IPO may have saved Saverin many millions of dollars.

Apparently he made the switch in September, but it wasn’t widely known until his name appeared on a government ex-citizens list on April 30. That made Saverin the central figure in stories that Right and Left had been writing before they knew he was involved.

The Right’s story. The growing numbers of citizenship renunciations (up about fourfold from the Bush administration average, but still just 1800 in 2011) was already being trumpeted as cause for alarm on April 23 by the Wall Street Journal’s William McGurn. As far as I know, no one has checked who all these 1800 are or asked them why they don’t want to be Americans any more, but McGurn is sure they are rich people fleeing oppressive American taxes.

when it comes to the global inefficiencies of our tax code, these 1,800 ex-Americans are canaries in the coal mine. Our tax code—and especially the onerous reporting requirements that come with it—is turning U.S. citizens into economic lepers.

His conclusion is that the U.S. needs to become “more competitive” by not taxing money that American citizens make overseas. This is related to another popular conservative talking point, but the U.S. should declare a tax holiday to allow American corporations to repatriate profits made overseas either tax-free or at a reduced rate.

On May 8, Bruce Bartlett addressed the ex-citizen issue in the NYT, doubting that any large number of the renunciations were due to taxes, but agreeing that there is a problem. Again, Saverin did not come up.

Saverin got attached to the story sometime in the next few days. Bloomberg was on it by May 11. And then things started to get crazy: Forbes’ John Tamny declared Saverin “an American hero“.

If you’re having trouble follow that logic — how exactly does declaring that you’re not an American any more make you an American hero? —  Tamny explains:

Saverin’s decision will starve the feds of revenue they would almost certainly waste, it will force a rethink of a tax code that penalizes income and investment success, and the unconsumed dollars kept from the hands of government will reach today’s and tomorrow’s businesses. Let’s raise a glass to Eduardo Saverin. He’s a true American hero.

Tamny hopes this will lead us to see the folly of the income tax, abolish the IRS, and institute a consumption tax instead (because apparently you get out of a recession by spending less and saving more, contrary to anything those stupid economists might tell you).

And if the tax is regressive or hits low incomes at the same percentage as high ones, all the better.

And if the world loses faith in the U.S. government’s ability to meet its obligations, that’s good too.

That Saverin has chosen to avoid supporting the Leviathan is a heroic act that will hopefully make investors a little bit more gun-shy about investing in U.S. debt.

Because every patriot wants to see his government default, I guess.

The Left’s story. For the Left, Saverin put a face on the Unpatriotic Rich, who (if they are loyal to anything beyond themselves) identify with their class rather than their country. The Nation’s Ilse Hogue:

[Saverin] has made himself the poster child for the callous class of 1 percenters who are all too happy to use national resources to enrich themselves, and then skate, or cry foul, when asked to pay their fair share.

Saverin’s wealthy Brazilian family moved to Miami when 13-year-old Eduardo’s name turned up on a list of kidnap-for-ransom targets. America kept him safe, and then let him into Harvard, which was generous enough to assign him a roommate with a $100-billion idea. (I wonder who he’d have roomed with at University of Singapore.)

I’m sure Saverin will be eternally grateful for those and many other favors America did him. But gratitude is a mere sentiment, and who thinks sentiment is worth tens of millions? (Did I mention that Singapore has no capital gains tax?)

A quick segue will take you to bankers who spout libertarian rhetoric about food stamps but demand that there be no strings attached to their bailout, or industrialists who want government subsidies to help them move American jobs to China. The rich only care about America if they can make money off of it. If not, bye-bye.

Of course, switching your loyalty for money is not new — it’s what Benedict Arnold did. We used to have a name for such people: traitors.

That’s the sentiment behind Senator Schumer’s proposal to levy a punitive capital gains tax on citizenship-renouncing Americans.

To sum up the liberal point: If we’re going to continue being the kind of country where people can get rich — a country with roads and schools and courts and police and a viable currency and salmonella-free food and a communications system and medical care and sidewalks clear of emaciated corpses — rich people are going to have to pay taxes. If they regard that as an imposition rather than a duty, they’re just proving how unpatriotic they are.

Saverin may illustrate that story, but we were telling it already.

Market society. I think a more interesting conversation comes from another pre-Saverin story: Michael J. Sandel’s “What Isn’t for Sale?” from the April Atlantic.

The most fateful change that unfolded during the past three decades was not an increase in greed. It was the reach of markets, and of market values, into spheres of life traditionally governed by nonmarket norms. To contend with this condition, we need to do more than inveigh against greed; we need to have a public debate about where markets belong—and where they don’t.

There’s a pretty broad consensus that America should have a market economy. In other words: The price of potatoes and beachfront property and replacement car batteries should be determined by supply and demand rather than set by a bureaucrat. A century ago, intelligent people could disagree about whether a centrally planned economy might work better. But after the bad example of the Soviet Union, we’ll stick with markets.

The problem, Sandel says, is that more and more we have not just a market economy, but a market society, a place where everything is for sale and everything is judged by market values. The problem with selling, say, transplantable kidneys, isn’t whether the price will be determined by markets or regulated by the government; the problem is selling them at all.

Some things just shouldn’t be part of the market economy. But what things?

Let’s suppose that Saverin didn’t just fall in love with Singapore one day, but that his accountant calculated that Singapore offered him a better deal than America. Is it wrong for him to take that deal? Why, exactly? What is the proper boundary between things that ought to be for sale and things that ought not?

Sandel sees that boundary sliding and thinks we need to have a serious conversation about how far it will go. Should first class passengers have a faster TSA line or not? Should rich prisoners be able to buy a cell upgrade or not? Should you be able to hire a surrogate womb to carry your fetus or not? Should parentless babies be auctioned off or not?

Consider privatized juvenile prisons. A decade or two ago, no one would even have suggested such a thing. A decade or two before that, no one would have suggested pushing sugary drinks or fatty sandwichs in public high schools in exchange for funding from Coke or Burger King. Of course you’ve always needed money to run a school or a prison, but schools and prisons weren’t about money. Today, some of them are.

Moving from a drafted citizen army to a professional army was a step towards market society. Moving from a professional public army to a contracted private army would be another. How far should we go?

Once we named parks and arenas for heroes. Now we auction naming rights off to the highest bidder. What values get reinforced every time we go to AT&T Park or Sports Authority Field (both of which I had to correct after remembering their “old” names of Pac Bell and Invesco)?

Economists often assume that markets are inert, that they do not affect the goods being exchanged. But this is untrue. Markets leave their mark. Sometimes, market values crowd out nonmarket values worth caring about.

When we decide that certain goods may be bought and sold, we decide, at least implicitly, that it is appropriate to treat them as commodities, as instruments of profit and use. But not all goods are properly valued in this way.

Is citizenship one of those goods? Why or why not?

May 21, 2012 – 12:49 pm Categories: Articles | Comments (3)

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196 People and other short notes

79% of Super-Pac money in 2011 came from 196 people.

Grist collects climate-change-denying quotes from all the likely Republican VP candidates. My favorite is by Virginia Governor Bob McDonald:

Too often in the debate it’s missed that the Earth has been warmer in the past

That’s like: “I don’t have to worry about falling off the Empire State Building. I’ve been at street level before and it was fine.”

Say, Europe, how’s that austerity thing working out?

Well, at least they didn’t try something like Obama’s stimulus. Imagine what a disaster that would have been.

An NUI Galway economics professor sums up the current proposal that Ireland double down on its austerity policy:

Take a country at the bottom of a depression. Force it to run budget cuts and tax increases year after year after year. Force this same policy on its neighbours and trading partners. Run this into the foreseeable future and hope it results in stability, confidence and recovery. This is emphatically not the safe option. This is a dangerous experiment, completely without historical precedent.

Why the Right really hates Obama: They don’t want to be this cynical about America, and it annoys them that Left doesn’t have to be.

Pat Robertson tells a viewer to destroy a friend’s Buddha statue. His resemblance to the Taliban gets stronger and stronger.

So you know how much money the Koch brothers spent to influence the 2010 elections? About $50 million more than anybody thought. It was funneled through a string of front groups with names like the American Future Fund and Americans for Job Security.

Another great article from Cracked: 6 Ridiculous Lies You Believe About the Founding of America.

Two respected political scientists have written a book about their research, which shows that political polarization and gridlock is overwhelming the fault of the Republicans. Their article in the Washington Post went viral. How much discussion did that garner on the Sunday major-network talk shows? None.

Easter Island heads have underground bodies. Who knew?

A new way to describe privilege to people who can’t hear the word privilege: In the Game of Life, white straight male is the lowest-difficulty setting.

May 21, 2012 – 11:33 am Categories: Short Notes | Comments (3)

Well-prepared Ground

We used to think that revolutions are the cause of change. Actually it is the other way around: change prepares the ground for revolution

– Eric Hoffer,  The Temper of  Our Time (1967)

In this week’s sift:

  • Everybody will support gay marriage by 2030. Support for gay rights has the most inexorable kind of momentum: generational. President Obama’s “evolution” may look risky now, but as gay-rights supporters come of age and opponents die, even the most homophobic politicians will have to capitulate — just like segregationist politicians did in the 1970s.
  • 77 Cents, part 2: What if secretaries became programmers? In a miniature economy with only 30 occupations, eliminating the difference between male-dominated occupations and female-dominated ones only knocks 3 cents off the pay gap. Equalizing pay within the 30 occupations knocks 12 cents off.
  • Does Romney’s bullying matter? and other short notes. The important thing isn’t what Mitt Romney did half a century ago; it’s how well his reaction today fits the story his critics tell about him. What Mom really wanted. LBJ’s greatest moment. Maurice Sendak’s last interview. Why does college cost so much? And more.
  • Last week’s most popular post. It was a slow week. Where the Jobs Are and other short notes was the most popular post with 140 views.
  • This week’s challenge. The Wisconsin recall campaign is on: a rematch of Walker vs. Barrett. Between now and June 5, this the biggest race going, and it will have national implications. You can contribute to the Barrett campaign here.
May 14, 2012 – 12:44 pm Categories: Weekly summaries | Post a comment

Everybody will support same-sex marriage by 2030

OK, everybody may be an exaggeration. Let’s just say every politician of any significance: every presidential candidate, every governor, every member of congress, and the leadership of every party in every house of every state legislature.

Two charts tell you all you need to know about the politics of same-sex marriage. First, it has long-term momentum:

Second, it has the most inexorable kind of momentum there is: generational. Each day a few more supporters turn 18 and a few more opponents die. That’s how it’s going to be for a long, long time.

Explain it to the kids. That’s why President Obama explained his own change of heart this way:

Malia and Sasha, they have friends whose parents are same-sex couples. There have been times where Michelle and I have been sitting around the dinner table and we’re talking about their friends and their parents. And Malia and Sasha, it wouldn’t dawn on them that somehow their friends’ parents would be treated differently. It doesn’t make sense to them and, frankly, that’s the kind of thing that prompts a change in perspective.

This is how taboos fall. One generation genuinely believes in the taboo. The next follows it out of habit, but can’t defend it. And finally there’s a generation that challenges: The kids ask “Why?” and their parents have no answer.

Many of those parents will stay stuck in their ways, but politicians can’t afford to. They have to follow the majority, even if it goes against what they’ve stood for in the past.

We’ve seen this happen before.

Race and the Owens-Louis kids. When Jesse Owens won Olympic gold in Munich in 1936, and then Joe Louis defended his boxing title against Max Schmeling in a sold-out Yankee Stadium in 1938, the rooting wasn’t black vs. white. It was America vs. Nazi Germany.

To many of the white American kids who listened to those two events on the radio, it only made sense to let Jackie Robinson play major league baseball in 1947, and later, to start breaking down color barriers all across society.

When Guess Who’s Coming to Dinner? raised the interracial marriage taboo in 1967, the Owens-Louis kids were the generation in between the Tracy-Hepburn parents and their Sidney-Poitier-dating daughter. They knew interracial marriage was still beyond the pale. Most of them would never consider it themselves. But they couldn’t explain why.

When the Owens-Louis generation reached middle age in the 1970s, segregationist politicians had to capitulate. In 1963 George Wallace could pledge “segregation forever”. In 1970 he successfully ran a race-baiting campaign for governor. But by 1979 he was saying, “I was wrong. Those days are over and they ought to be over.”

The 1970s didn’t end racism — racists can still dog-whistle and use code words — but they ended the days when a politician could stake out an openly racist position and hope to win on it, even in Alabama.

Today, the Owens-Louis kids are the old folks, and returning to Jim Crow is as unthinkable as returning to slavery. Whenever same-sex marriage proponents are allowed to make the link to interracial marriage, the argument is over. No public figure will defend banning interracial marriage — a practice that was controversial even to talk about in 1967.

The Willow-Tara generation. In its acceptance of gays and lesbians, sports has trailed the culture rather than leading it. The characters who changed our thinking about homosexuality are more likely to be fictional ones we met through TV and movies.

In the late 1970s, it was edgy for Jack even to pretend to be gay on Three’s Company. Gay and lesbian minor characters started appearing on dramas like Hill Street Blues in the 1980s. Tom Hanks won an Oscar for his starring role as a sympathetic gay character in Philadelphia in 1993. From 1998-2006 Will and Grace (cited by Vice President Biden) centered on a gay man’s friendship with a straight woman.

I decided to symbolize this generation with a fictional same-sex couple almost exactly the age of the oldest Millennials: Willow and Tara on Buffy the Vampire Slayer, whose relationship began right around the turn of the millennium.

Earlier pop-culture characters got viewers sympathizing with the problems of gay and lesbian individuals and their same-sex relationships. But for most of two seasons Willow and Tara raised a different question: What if there is no problem? What if two people of the same gender meet and fall in love and are happy together?

Like Willow and Tara, the oldest Millennials are about 50 years younger than the Owens-Louis kids. So as a guess, let’s set the 2020s as the decade of capitulation on gay rights: Every major politician will either leave the business or have a change-of-heart by 2030. Even conservatives, even in the Bible Belt.

Remember the Dixiecrats. Does that seem unthinkable? What about Sarah Palin, Rick Santorum, and younger politicians who seem eager to follow their lead? But what about Strom Thurmond, who during his Dixiecrat presidential campaign of 1948 said:

that there’s not enough troops in the army to force the Southern people to break down segregation and admit the Negro race into our theaters, into our swimming pools, into our homes, and into our churches.

In 1971 Senator Thurmond integrated his staff, and in 1983 he voted to honor Martin Luther King with a federal holiday. The sincerity of his transformation may be dubious, but he had to make it.

Biden first. The leading edge of gay-rights capitulation is in the Northeast and among Democrats. So it’s no coincidence that President Obama was put on the spot by Vice President Biden. Whatever happens in 2012, Biden is looking down the road to the Democratic primaries of 2016. No way a Democrat with an ambivalent gay-rights position wins in New Hampshire (where same-sex marriage is already legal) in 2016.

Politicians can read trend lines. If you hope to win statewide office in the Northeast or in California in 2020 — or anywhere in 2030 — you can’t be against same-sex marriage. The question isn’t whether you’ll change, it’s when.

The ancient ship Homophobia has had a long run, but it is going down. While it may take years to sink completely, no politician wants to go down with it. Those with any sense are already checking the exits and plotting their departure.

May 14, 2012 – 12:36 pm Categories: Articles | Comments (12)

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77 cents, part II: What if secretaries became programmers?

When I was a kid in the 1960s, wage discrimination against women wasn’t something you had to ferret out with statistics.

My grade school was owned by the Lutheran church my family belonged to, and the congregation had to approve  the teachers’ salaries each year. So everyone knew that Male Teacher and Female Teacher were two different professions with different pay scales. If we hired a man and a woman straight out of the same Lutheran teachers’ college, we’d pay the man significantly more.

Everyone knew why: Male teachers (even if currently single) would need to support a family, while women (even if currently childless) taught either before or after their real profession, which was raising children.

That kind of thinking hung on longer in religious workplaces than elsewhere, but it wasn’t uncommon. Men made more than women, even if they were doing the same job. It was out in the open because nobody was ashamed of it.

Today, such overt separate-pay-scale discrimination is both illegal and socially unacceptable, so remaining wage discrimination (if any) must be hidden. That’s why we do statistics.

Last week I verified that at the grossest level, women still make less. In 2011, women working full time made 82 cents for every dollar made by men working full time. (The often-quoted 77 cents figure is a year older and figured slightly differently, which tells you something about the sensitivity of the calculations. In what follows I’ve been careful not to mix data from different sources. Everything comes from the Bureau of Labor Statistics table that leads to the 82-cent estimate.)

But why do women make less? Is it for reasons we can all live with, or is the pay gap an injustice that needs fixing? Several reasons are frequently offered, together with explanations why we can live with those reasons. (Never forget that those are two separate conversations. Even if the whole pay gap could be boiled down to something as simple as “Girls don’t like math”, we’d still need to discuss whether that’s a problem we can or should fix.)

For each proposed reason, there’s a study proving that it’s not the whole story. Today I want to look at one of the most popular explanations of the pay gap: Women choose lower-paying professions. In other words, the overall averages compare female special education teachers to male aerospace engineers. No surprise who makes more.

The Institute for Women’s Policy Research has a study “The Gender Wage Gap by Occupation” proving that occupational segregation (as they call it) is not the whole story. Using Bureau of Labor Statistics numbers from 2011 (the same ones in that 82-cent calculation), they list the 20 most popular occupations (out of around 400 listed by the BLS) for men and for women. Four occupations are on both lists, and six more are too segregated (i.e., construction worker, teacher assistant) to provide a reliable estimate of the minority gender’s earnings.

In the 30 remaining occupations, men make more in 28, and the other two are low-pay occupations where the female advantage is small: Female “stock clerks and order fillers” make $1.03 for every male dollar, and female “bookkeeping, accounting and auditing clerks” make $1.003. On the other pan of the scale, men have huge margins in high-pay occupations like “financial manager” (where women make 66 cents on the male dollar) and “chief executive” (69 cents).

So clearly, occupational segregation isn’t the whole story of the wage gap. But here’s the more interesting question: Granted that it isn’t the whole story, how big a part is it?

Maybe there’s a study that answers that question, but I didn’t find it. So I crunched some numbers myself. I started with the numbers in Table 1 and Table 2 of the IWPR report, restricting my attention to the 30 comparable occupations.

Eliminating the duplicate occupations and totaling up, we’ve got 18.4 million men making a total of $16.4 billion per week ($892 each) and 20.9 million women making $15.0 billion per week ($715 each), or about 80 cents on the dollar. So these 30 occupations are slightly better than average for both men ($832 overall) and women ($684), with women making almost the same relative wage (80 cents on the dollar) as in the total survey (82 cents).

To understand what I did next, imagine that there are only two occupations: male-dominated “software developers” and female-dominated “secretaries and administrative assistants”. (These are two of the 30 from the IWPR study.)

 occupation  # men  men $  # women  women $
 software  812  $1606  179  $1388
 office  84  $757  2059  $651
 Total/average  896  $1526  2238  $710

(The number of workers is in thousands.) So our miniature, two-occupation economy (call it “2-Job World”) employs 3,134,000 people (896,000 men and 2,238,000 women) and has a total weekly payroll of  $2.96 billion ($1.37 billion to men, $1.59 billion to women). Overall, its men average $1526 per week and its women $710. So the unfortunate women of 2-Job World make only 46 cents for every dollar a man makes, even though they make 86 cents on the dollar in each occupation. (That’s why I picked those two for my example.)

Amateur economists in 2-Job World — there are no professional economists, that would be a third job — could analyze their pay gap by constructing two counter-factual models. In each model, each occupation maintains the same the total number of jobs and the same total payroll, but women move towards equality in two different ways.

In 2-Job World Fantasy #1, the ratio of men and women in each profession equalizes. Overall, 29% of the workers are men. So in Fantasy #1, 29% of workers in each occupation are men. But the wage gap within each occupation stays the same: 86 cents on the dollar. That changes the table to look like this:

 occupation  # men  men $  # women  women $
 software  283  $1735  708  $1499
 office  613  $728  1530  $626
 Total/average  896  $1046  2238  $902

Basically, bringing lower-paid women into software allowed us to raise salaries in general, while bringing higher-paid men into the secretarial pool forced us to cut salaries there. But now we have an economy where there is no occupational segregation, and women make (surprise) 86 cents on the dollar.

In 2-Job World Fantasy #2, we leave everybody in their current job, but equalize pay within the occupations, so everybody makes the average salary for their occupation. That gives a table like this:

 occupation  # men  men $  # women  women $
 software  812  $1567  179  $1567
 office  84  $655  2059  $655
 Total/average  896  $1481  2238  $728

And here you wind up with women making 50 cents on the male dollar. You’ve only nudged the pay gap by 4 cents.

(I know what some of you are thinking: Where’s the extra 10 cents? Shouldn’t the 4 cents from equalizing pay and the 40 cents from equalizing occupational segregation add up to 2-Job World’s whole 54 cent pay gap? Congratulations, you have just discovered non-linearity. Equalizing pay in the already-desegregated world of Fantasy #1 would have a 14-cent effect, while it only has a 4-cent effect in the original 2-Job World.)

So 2-Job World looks like some people’s intuition about our whole economy: The big money is in getting women to become programmers instead of secretaries.

But when I applied the same two fantasies to the more representative 30-Job World, it came out exactly the other way. In 30-Job World (where women make 80 cents on the dollar), Fantasy #1 (desegregating the occupations) only gets us a 3-cent gain to 83 cents.

But Fantasy #2 (where both men and women make the average salary for their occupations) raises women’s relative pay to 92 cents. It gains women 12 cents rather than 3 cents.

So at least in 30-Job World, getting equal pay within each occupation turns out to be about four times more important than getting equal representation within the occupations.

Why? While programmers and secretaries are part of 30-Job World, the bigger effect comes from occupations that are already fairly well integrated, but men just make more, like retail sales supervisors: about 1.3 million men and 1.0 million women, but the women make 79 cents on the dollar.

Is that how things work in the overall economy (400+ Job World, if you use the BLS categories)? I’m not ready to say that yet. But until I see a better analysis, I’m going to be very skeptical of anybody who claims the wage gap is even largely due to women’s choice of professions. I’d be surprised if it ultimately explained more than a nickel of the gap.

Technical notes:

If you need to see for yourself, I’ve posted the larger tables: 30-Job World Actual, 30-Job World Fantasy #1, 30-Job World Fantasy #2.

I anticipate this objection: When I eliminated the 6 occupations where there wasn’t a large enough sample to get a good estimate of one gender’s wages, I disposed of exactly the occupations where desegregation would make a difference.

Strange things happen when you put those occupations back in, and they work backwards from what the objector might expect. Five of the six are male-dominated working-class jobs. When you lump them together, they pay less than even the female average in 30-Job World.

So the main effect is to pull the male average down, which gets the wage ratio in 36-Job World up to 83 cents. From there, Fantasy #2 gets you to 94 cents. Fantasy #1 is hard to apply (because you don’t know what to pay the minority gender). But if you equalize even further (just for those 6 occupations) by paying the minority gender the overall occupational average , you only get up to 84 cents — higher than in 30-Job World Fantasy #1, but showing a smaller improvement over 36-Job World Actual.

May 14, 2012 – 12:05 pm Categories: Articles | Comments (3)

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Does Romney’s bullying matter? and other short notes

The second most-talked-about story of the week was the Washington Post’s report on Mitt Romney’s days at the exclusive Cranbrook prep school, and in particular on his bullying of a gay underclassman.

The biggest debate was around whether anyone should care. Liberals hate the attempts to make scandals out of Obama’s distant past. Isn’t this the same kind of hit piece?

Not entirely. It’s much better sourced than the typical Obama-went-to-a-madrassah story. The sources are named; they were Romney’s classmates; and one of them was his best friend and roommate. Hit pieces come from people who are rewriting history to make themselves look good. Mitt’s roommate knows he’s making himself look bad. He’s telling the story because he feels bad; he’s regretted his role in the bullying incident ever since it happened.

But even if the WaPo’s story is 100% accurate, why should we care? It was a long time ago. Don’t we all have high school memories that make us cringe?

After telling his own high school cringe story, Steve Almond says that’s exactly the problem: Romney shows no signs of cringing. He says he doesn’t remember, that “I did some stupid things in high school, and obviously if I hurt anyone by virtue of that, I would be very sorry for it and apologize for it.”

I would be sorry, if I hurt anyone (like a bunch of my friends remember me doing).

A few weeks ago in The Narratives of November, I talked about the stories that each campaign is trying to establish in the minds of voters. Incidents like this only matter politically if they find a place in those stories. Like the dog on the roof incident and “I like being able to fire people“, this one does.

Mitt Romney’s policies, like Republican policies in general, impose sacrifice and suffering on Americans who are already down on their luck: people who need food stamps, unemployment benefits, or help paying for medical care. You can spin that two ways. Positively, Romney is a decisive leader making tough choices in difficult times. Or negatively, he just doesn’t care.

It matters a lot which way that spin goes. In the 1980s, was Romney the business visionary who realized how corporate America needed to change? Or was he the vulture capitalist who gave no thought to the lives and communities he might wreck? Today, is he the grown-up in the room, who overcomes his sentimental reactions to do what needs to be done? Or is there nothing to overcome, because he has no feelings for anyone but himself, his family, and his super-wealthy peers?

If he can’t even respond to the WaPo story with something as simple as: “I’ve felt bad about that incident for years, and I wish John were still around so I could apologize to him face-to-face”, then the he-doesn’t-care spin gets a big boost.

A real mom lays out what she really wants:

Obama’s support of same-sex marriage is brave, but it’s not in the same league with LBJ’s speech supporting the Voting Rights Act in 1965.

Bad as Johnson’s delivery was, I always tear up when he gets to this:

Their cause must be our cause too. Because it is not just Negroes, but really it is all of us, who must overcome the crippling legacy of bigotry and injustice. And we shall overcome.

Maurice Sendak’s last interview with Stephen Colbert was a good way to go out.

Paul Krugman predicts the endgame in the long-running Euro crisis.

Just as the Mayan calendar starts running out, somebody finds another Mayan calendar.

Or from the Left: “Obama caves on high-fructose corn syrup.”

Senator Richard Lugar was never exactly a moderate, but at least he would listen sometimes and think about the national interest rather than his party’s interest. His message after losing a primary to a Tea Party challenger:

Ideology cannot be a substitute for a determination to think for yourself.

A very sophisticated quiz to help you figure out which party lines up with your views. I came out Green, probably because it doesn’t ask: “Do you want to vote for somebody who has a chance to win?”

Salon looks at the cost of college and concludes: As government spends less on higher education, students have to spend more. And what government does spend is more and more likely to get siphoned off by exploitive for-profit institutions.

May 14, 2012 – 11:43 am Categories: Short Notes | Comments (1)

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