Month: March 2016

Bootleggers and Baptists

Prohibition: Sheriff Dumps Bootleg Booze

Prohibition: Sheriff Dumps Bootleg Booze

When a campaign is underway to regulate a business or a product, it’s usually easy to identify two groups promoting increased regulation: “Bootleggers” (people who will benefit because the regulation hobbles a competitor) and “Baptists” (people who sincerely believe the new regulation will help others.) The Baptists naively think goodness will come from outlawing bad things, while the bootleggers are aware of unintended consequences and second- and third-order effects of the proposed regulation that will benefit them personally, but pretend to join the Baptists on a moral crusade. Marching together, they agitate for more laws and less freedom of choice.

“Bootleggers and Baptists” is a catch-phrase invented by regulatory economist Bruce Yandle for the observation that regulations are supported both by groups that want the ostensible purpose of the regulation, and by groups that profit from undermining that purpose.

For much of the 20th century, Baptists and other evangelical Christians have been prominent in political activism for Prohibition and Sunday closing laws restricting the sale of alcohol. Bootleggers sold alcohol illegally, and got more business if legal sales were restricted. “Such a coalition makes it easier for politicians to favor both groups. … [T]he Baptists lower the costs of favor-seeking for the bootleggers, because politicians can pose as being motivated purely by the public interest even while they promote the interests of well-funded businesses. … [Baptists] take the moral high ground, while the bootleggers persuade the politicians quietly, behind closed doors.

Strongly-motivated minority interest groups can move the political process toward satisfying their demands, as Prohibitionists did when they succeeded in getting the Eighteenth Amendment passed outlawing alcoholic beverages in the US, a ban which lasted from 1920 to 1933 before it was repealed by the Twenty-First Amendment. It took a decade of rising organized crime and disrespect for the law to finally rouse the great middle of the electorate to demand repeal.

Similar battles still take place on smaller scales. In a recent example,

Arkansas liquor stores have allied with religious leaders to fight statewide legalization of alcohol sales. The stores in wet counties don’t want to lose customers. The churches don’t want to lose souls. Larry Page, a Southern Baptist pastor and director of the Arkansas Faith and Ethics Council, which traces its roots to the Anti-Saloon League of Arkansas in 1899, [also recalled]. . .when his group joined with feminists to oppose pornography and cooperated with Mississippi casinos to fight gambling in Arkansas.

The selfish motivations of the bootleggers hide behind the naive but high-minded feelings of the Baptists. How can a politician oppose Goodness in the form of legislated morality?

Here are some other examples of the phenomenon:

Universal pre-K: Who can be against the education of young children, especially those growing up in poor environments for early learning? Surely extending public school to even earlier years will help underprivileged children catch up! And parents can use even more public-funded daycare to ease their burden, right?

While it’s common to see articles and editorials accepting the positive benefits of pre-K programs without question, the evidence is thin and suggests that some children can benefit from very high-quality programs, but that such benefits disappear after a few years. The Head Start federal program targeting poor children has been expensive and disappointing, with recent studies demonstrating little permanent improvement in outcomes in the long term.

As often happens, proponents start a few pilot programs, recruit highly-motivated staff and parents, and find significant positive benefits. When expanded and managed via the standard education bureaucracy and with less-motivated, unionized staff, benefits to the children shrink or disappear completely, with some programs actually worse for children than being left in a standard private preschool or home setting.

A well-regarded and funded program in Tennessee was studied by a grant-funded group of social scientists and educators at Vanderbilt who had every reason to bias the study to favor the state’s pre-K program. The result? (Emphasis added):

By the end of kindergarten, the control children had caught up to the TN‐VPK children and there were no longer significant differences between them on any achievement measures. The same result was obtained at the end of first grade using both composite achievement measures. In second grade, however, the groups began to diverge, with the TN‐VPK children scoring lower than the control children on most of the measures. The differences were significant on both achievement composite measures and on the math subtests. … In terms of behavioral effects, in the spring the first grade teachers reversed the fall kindergarten teacher ratings. First grade teachers rated the TN‐VPK children as less well prepared for school, having poorer work skills in the classrooms, and feeling more negative about school. It is notable that these ratings preceded the downward achievement trend we found for VPK children in second and third grades. The second and third grade teachers rated the behaviors and feelings of children in the two groups as the same; there was a marginally significant effect for positive peer relations favoring the TN‐VPK children by third grade teachers.

The constant drumbeat of publicity promoting Universal pre-K is motivated by the desire of teacher and public employee unions to employ more staff who will provide more revenue and political power for them. They are the bootleggers in the coalition pushing for Universal pre-K at local and federal levels, and the disorganized voices of those who would be hurt by such programs — operators of private preschools, parents of children who want to choose which daycare they pay for or handle pre-K nurturing themselves — are rarely heard, while the propaganda from the government PR offices and unions is well-funded by tax dollars and compulsory union dues.

Free College For All: Bernie Sanders is currently promoting a plan for free tuition at public colleges and universities for everyone. “Education” (in the form of conventional regimented schooling) is a sacred cow, and the belief that everyone is better off being sent to college after high school has been promoted by politicians for years. We’ll cover the pernicious results of policies based on that belief later in the chapter on Higher Education, but we’ve already seen what happens when you make subsidized student loans available to everyone: you get millions of deeply-indebted former students, both those who failed out because they should never have been admitted in the first place and those who learned little of value to the job market. You also get a high rate of inflation in college costs, as these loans allowed colleges to expand and compete for students with less concern for costs or outcomes.

The Baptists in this case are all those well-meaning people who believe everyone should go to college and get a professional white-collar job. The bootleggers are all of those college administrators and employees who benefit from increased funding and enrollment, the prospective students who want to have a free ride, and the politicians who rely on the support of academics. The scribes and government workers who are products of academia themselves write all the narratives in our society, and blue-collar workers and nonacademics who would be taxed to pay for this freebie get no taxpayer funding to tell their own stories.

Let well-known philosopher of labor Mike Rowe explain this:

Consider the number of college graduates today, who can’t find work in their chosen field. Hundreds of thousands of highly educated twenty-somethings are either unemployed or getting paid a pittance to do something totally unrelated to the education they borrowed a fortune to acquire. Collectively, they hold 1.3 trillion dollars of debt, and no real training for the jobs that actually exist. Now, consider the country’s widening skills gap – hundreds of thousands of good jobs gone begging because no one wants to learn a useful trade. It’s madness. “College For All” might sound good on the campaign trail, but in real life, it’s a dangerous platitude that reinforces the ridiculous notion that college is for people who use their brains, and trade schools are for people who use their hands. As if the two cannot be combined.

Universal Healthcare: The Baptists here are well-meaning people who think everyone should get good healthcare, and because they have been told by propagandists that everyone in Europe and Canada has free, quality healthcare that costs their government far less, they can’t imagine why the US shouldn’t have it, too. Which ignores the major differences between such programs — only Canada has single-payer without a parallel private-pay healthcare system, and even that is changing, while the Canadian provinces vary in costs and coverages, as well as waiting periods for nonemergency care. Meanwhile, European countries have systems that vary from Britain’s NHS, a completely government-owned and run healthcare system with enough problems that its breakdowns are daily news fodder, to Swiss and French programs that are really public-private insurance plans with cheaper basic options. “Medicare-for-All” as proposed by US universal healthcare proponents would expand the Medicare system, which is already headed for financial disaster as the population ages, to cover everyone. It’s never acknowledged that rising costs will then require rationing and onerous cost controls that would make the US system start to resemble Britain’s NHS — cheaper but lower quality, with worse outcomes for cancer treatments and limited access to more advanced care.

Who are the bootleggers? The ACA co-opted the big health insurance and drug companies to guarantee them a captive market with higher revenues in return for turning the private insurance market into a kind of regulated utility that everyone would be forced to join, which allows regulations to essentially tax younger and healthier people to subsidize the costs of the older and sicker without regard to ability to pay. We now have lower-middle-class working families paying much more than they would in a free market so that wealthy people with pre-existing conditions can get insurance at subsidized rates. While many pre-existing conditions were unfortunate accidents, some were acquired because of poor life choices and self-indulgent health and dietary habits — so now the rich couch potato who drank and ate himself to diabetes and heart problems suffers no penalty, at least financially, since some group of healthy families is paying extra to subsidize his care.

Single-payer, Medicare-for-All is another step toward micromanagement of both citizen lifestyles and medical procedures. The politicians are dreaming of more dependent voters who will always support them, as in Britain, where voters are continually told they can have a “better” NHS by voting in the right people. The problems of the British NHS cannot be solved by a change in administrations because they are due to its structure as a socialized service, with unionized civil service-style employee protections and the accompanying limited accountability for poor service and failure. Once in place, such systems are very difficult to repeal, and their bureaucracies, like today’s federal HHS and Medicare bureaucracies, provide a good place for political supporters to collect a paycheck while serving as the party of government’s permanent supporting class.

Climate Change: The Baptists here are citizens who believe that not only is global warming a man-made phenomenon resulting from increases in greenhouse gases in the atmosphere (that much is probably true), but that its onset will be rapid and severe enough to justify virtually any costly program proposed to limit the threat (which appears untrue, or at least unproven, as the simplistic early climate models have failed to correctly predict the amount of actual warming.) What price would you pay to save the planet? Even questioning the cost of proposed programs is viewed as heresy by true believers.

The bootleggers are the rent-seeking part of the coalition to “do something,” which began when the danger was first popularized and resulted in large increases in research funding for the small number of climate scientists who specialized in climate change research. As momentum built and more governments funded research and activism in the field, whole labs and careers depended on finding the danger to be as large as possible, to justify ever more research funding. Stoking popular fear, politicians could appear to be protecting citizens by promising more and more measures to slow greenhouse gas emissions. It became clear, though, that vested interests would not allow the least-cost, most economically-sound means of reducing emissions: research on solar and nuclear power generation and low, rebated carbon taxes which would allow businesses and citizens to gradually reduce emissions over time without sacrificing current plants and arrangements.

What happened instead: complex emissions credit schemes which allowed politicians to favor some interest groups over others while raking in hidden taxes from consumers; mandates requiring utilities to pay much more to purchase ever-increasing percentages of “green” power, generated at high cost from subsidized windmills and solar power plants which proved to work poorly or have limited service lives; and command-and-control regulations that shut down existing plants and closed down coal mines.

Each of these schemes had bootleggers waiting to profit: politically-connected investors in solar power schemes like Solyndra (bankrupt in 2011, with $535 million in federally-guaranteed loans and $25 million in California tax credits lost) and the Ivanpah steam-solar project ($2.2 billion, obsolete and unable to generate its designed power since the day it opened.) Both Ivanpah and Solyndra were huge bets on the wrong technologies, with standard photovoltaic panels falling in price so much that these huge investments were rendered uncompetitive shortly after they were funded. Ivanpah received $1.6 billion in loan guarantees from federal taxpayer funds, covering investments by its owners, BrightSource Energy, NRG Energy, and Google. The company has delayed payment on its loans and in late 2014 requested an additional $539 million in funding via a federal tax credit program.

Spain’s Abengoa, a multinational alternative energy company, has filed for Chapter 11 protection in the US, and in March of 2016 filed for bankruptcy. The federal loan guarantees for $1.45 billion for the Solano solar plant in Arizona and the $1.2 billion for the Mojave solar project in California now appear to be US taxpayer losses. Again, enormous sums of taxpayer money built scaled-up projects with obsolete technology which could only produce power at many times the cost of natural gas plants.

In parts of Europe and the US, poor and middle-class ratepayers pay much more for electricity because of these state-required green energy programs, while many wealthy consumers avoid paying the inflated rates by installing subsidized solar panels.

Other bootleggers include the large number of government staff now employed to work on climate change issues and propaganda in governments around the world, with the many UN climate meetings in cities like Paris and Copenhagen serving as luxurious junkets for tens of thousands of functionaries.

Even businessmen in the petroleum industry will surreptitiously support green activist organizations they believe will harm competitive fuels more than theirs. Aubrey McClendon, who made and then lost a huge fortune pioneering the fracking production of natural gas in the US, “secretly gave $25 million to the Sierra Club for the Sierra Club’s ‘Beyond Coal’ campaign, for the obvious reason that it would benefit his natural gas company if coal were squeezed by new regulation.”:

But as the Sierra Club and other environmental groups have made clear, once they’re done killing coal they’re going after natural gas next. Did McClendon think they’d spare him? He was a perfect example of Churchill’s description of an appeaser as someone who feeds the crocodile hoping he’ll be eaten last. I lost all respect for McClendon when this news leaked out, and it was a great embarrassment to the Sierra Club as well. He was rent-seeking bootlegger. A lot of them died in high-speed crashes back during Prohibition, usually being chased by the law.

Internet Gambling Prohibitions: This is closer to the coalitions against alcohol, with many religious and social organizations concerned about gambling addiction (the Baptists) joining with casino magnates, Indian tribes, and state lotteries (the bootleggers) to try to outlaw a competitor — easy gambling on the Internet. In 2015, Sheldon Adelson, billionaire head of the Las Vegas Sands and numerous hi-revenue casinos worldwide, promoted a bill in Congress (The Restoration of America’s Wire Act, or RAWA) intended to prohibit Internet gambling at the federal level, superseding state authorizing laws. He hired a lobbying firm, Steptoe and Johnson, which was then also hired by fantasy sports companies — which would be exempt under the proposed Act. By outlawing some forms of online gambling but exempting others, the proposed law would preserve casino monopolies and take control away from states.

Tobacco: Vaping equipment, or e-cigs, provide the appearance of cigarettes and a dose of the nicotine smokers crave in a delivery format (evaporated carrier with nicotine and flavoring) that is much less harmful to smoker’s lungs. Many experts recommended smokers switch to e-cigs immediately, since harm to their health would be much reduced. But e-cigs threaten both the makers of the highly-regulated and taxed legacy cigarettes and the makers of smoking cessation products like nicotine gum and patches — often the same companies! So paid “medical authorities” and lobbyists began to work hard to promote the view that the new and untested e-cigs were just as hazardous — if not more hazardous, since their long-term effects were unknown! — than traditional cigarettes. Cato’s Regulation put out a good paper on the bootleggers-and-Baptists pattern in this new propaganda war:

Now consider the situation with electronic cigarettes (e-cigs) and their incumbent competitors: tobacco companies that produce and sell traditional cigarettes and drug companies that produce nicotine replacement therapies (NRTs). The U.S. cigarette market has been regulated, one way or another, since colonial times. Along the way, federal regulation—coupled most recently with the state attorneys general Master Settlement Agreement (MSA, about which we say more later)—effectively cartelized the industry, bringing increased profits to the industry and higher cigarette prices and reduced cigarette consumption throughout the nation. Falling cigarette consumption gladdened the hearts of health advocates, who fought for the elimination of tobacco products, while higher industry profits brought joy to tobacco company owners.

This happy Bootlegger/Baptist equilibrium is now threatened by the exploding sales of e-cigs, a new technology for delivering nicotine to all who want it without simultaneously bringing the harmful combustion-induced chemicals associated with burned tobacco. Today, there are many e-cig producers and numerous small shops selling e-cigs and customized nicotine-dispensing products. It is a rapidly evolving market that has been relatively open to new entrants and innovation in product design. Given the quick growth in e-cig use (much of which comes at the expense of cigarette sales), previous political deals that stabilized tobacco industry profits are at risk. The major tobacco companies are understandably not sitting idle. They, too, have entered the e-cig marketplace and are responding in other ways to the new competition.

The major pharmaceutical companies have not been idle either. The makers of smoking cessation products, including NRTs such as the nicotine patch and nicotine gum, are major players in the politics of tobacco and nicotine. The producers of traditional nicotine delivery devices and NRTs are at work trying to stop the disruptive e-cig producers. These Bootleggers are joined by health advocates (Baptists) who raise questions about unknown potentially harmful effects that may be associated with e-cig use. Both groups—cigarette and NRT producers on the one hand, and health advocates on the other—would like to stop new e-cig producers or severely crimp their ability to compete.

Lawfare between the tobacco industry and state attorneys general was settled in 1998 with the MSA (Master Settlement Agreement), which set the payments due to the states to compensate them for the additional Medicare and Medicaid costs states would bear because of tobacco products. The agreement was carefully designed to send money to the states while protecting the incumbent manufacturers from competition, allowing them to raise prices more than required to pay the fines.

Again from Cato’s paper:

The heart of the MSA was the promised payment of $206 billion by the four participating cigarette companies to the participating states. Those payments would be tax deductible and the costs would be paid by consumers in the form of higher cigarette prices. (Because cigarette consumption is highly price inelastic, the cost of the price increase was largely borne by consumers rather than producers.) The MSA presented state legislatures with a simple choice: either accept the MSA, in which case they would be able to spend their state’s share of the billions of dollars raised from smokers, or reject the proposed statute and their states’ smokers would still pay the higher prices necessary to fund the deal but they would lose their claim on the money. Not surprisingly, every state legislature took the money.

Responsibility for the payments was allocated among the cigarette companies in proportion to their current market share, thereby reducing the incentive for the participating cigarette companies to engage in price competition to increase their respective market shares. The structure of the MSA thus provided a powerful incentive for each company to be satisfied with the status quo.

The MSA also attempted to protect the major cigarette companies from new competition. At the time of the agreement, the four participating cigarette companies accounted for about 99 percent of domestic cigarette sales. Increasing cigarette prices to pay for the settlement risked a loss of market share to marginal competitors or new entrants. Therefore the MSA provided that for every percent of market share over 2 percent lost by a participating cigarette manufacturer, the manufacturer would be allowed to reduce its payments to the states by 3 percent, unless each participating state enacted a statute to prevent price competition from non-participating manufacturers (which each state did). The statutes require nonparticipating cigarette producers to make payments equal to or greater than what they would owe had they been participants in the agreement, to eliminate any cost advantage.

The MSA also included restrictions on cigarette marketing practices agreed to by the participating producers. The advertising limits were portrayed as a public health measure because they reduced advertising that could influence young adults and teens. The limits also reinforced the anticompetitive nature of the MSA by making it more costly for new brands or entrants to secure market share through promotional efforts.

The MSA’s cartel-reinforcing provisions sufficiently suppressed competition to enable cigarette companies to take advantage of the price inelasticity of cigarette demand and obtain record profits. This made it possible for the major cigarette manufacturers to increase prices by more than was necessary to make the mandated MSA payments.

Having made a deal to get big money for states and attorneys while protecting the companies from competition and raising prices more than enough to make the addicted smokers themselves pay the full cost of the settlement, many of the states decided to grab their money immediately by selling municipal (federal tax-free) bonds backed by the MSA payments expected. California alone issued at least $16.8 billion in such bonds, proceeds being used for both immediate expenses and long-term capital improvements. Legislators appear to have forgotten that the supposed purpose of the payments was to cover smoking-related expenses of future medical care for the state’s population, and instead chose to spend the money immediately on unrelated matters while leaving the burden of those health expenses with future taxpayers.

In some cases, however, the bonds are backed by secondary pledges of state or local revenues, which creates what some see as a perverse incentive to support the tobacco industry, on whom they are now dependent for future payments against this debt.

Tobacco revenue has fallen more quickly than projected when the securities were created, leading to technical defaults in some states. Some analysts predict that many of the bonds will default entirely. Many of the longer-term bonds have been downgraded to junk ratings. More recently, financial analysts began raising concerns that the rapid growth of the electronic cigarette market is accelerating the decline of $97 billion outstanding in tobacco bonds…. Lawmakers in several states proposed measures to tax e-cigarettes like traditional tobacco products to offset the decline in TMSA revenue. They anticipate that taxing or banning e-cigarettes would be beneficial to the sale of combustible cigarettes. — Wikipedia on “Tobacco Master Settlement Agreement”

Vested interests, including tobacco companies and the states, now actively seek to suppress e-cigs or at least tax them enough to make up for any lost revenue as they are adopted. This means they are actively working to keep smokers addicted to the most hazardous form of nicotine consumption, with its resultant cancers and other diseases. The original Baptist goal of helping smokers quit the habit to avoid cancer and early death has long since been forgotten.

Minimum Wage: Baptists: voters who want low-paid workers to have better lives and higher incomes, imagining poor families will benefit while businesses will pay the costs. Bootleggers: Politicians needing an issue to show they want to help “working families” and unions who represent some minimum-wage workers, but more importantly represent many more workers who make more than that, who will get even higher wages as a result of existing contracts and the outlawing of lower-paid laborers who might compete with them.

Economically, it’s very clear: minimum wage laws harm inexperienced and unskilled workers by making it illegal for them to be employed at wage rates that reflect the value they can add with their labor. Those workers won’t be hired, and many will be replaced by automation as they are priced out of the labor market. Politicians and union bosses won’t lose their jobs, even as unemployment among the unskilled increases as a result of the new minimum wage law. Most unionized workers make much more than minimum wage now, so they will keep their jobs while outlawing lower-priced nonunion competition. Economists who study the issue tend to agree there is a small negative effect on employment when minimum wages are increased slightly, but the large increases now proposed may do much greater harm by reducing hours and eliminating jobs for unskilled workers. The economists who find no negative effects tend to be labor economists, who tend to be supported by government and labor union funding and so have some conflict of interest in their researches.

Meanwhile, small business owners are ignored when they explain their response to much higher minimum wages has to be reduced hours, higher prices, and possibly going out of business since many have committed to expensive leases and can’t withstand a huge increase in costs:

[Seattle restaurant owner Grant Chen wrote of] his struggles to stay in business as he faces a 61% increase in his labor costs from Seattle’s $15 minimum wage initiative. As I’ve mentioned before on CD, the $15 an hour minimum wage law isn’t really ultimately “a political problem as much as it’s a simple math problem,” as Anthony Anton of the Washington Restaurant Association explained the situation. And Grant Chen and other Seattle restauranteurs like Brendan McGill (owner of Hitchcock Restaurant and Hitchcock Deli) are finding out that the new restaurant math of Seattle’s $15 minimum wage is breaking the system…. a 61% increase in wages from $9.32 to $15 an hour is like imposing an annual tax on restaurants of $11,360 per full-time employee. If you understand that a $11,360 tax per employee (and $113,600 in higher labor costs for every 10 employees) would drive many restaurants out of business, you’ll understand why the “new restaurant math of a $15 minimum wage” is making Grant Chen’s restaurant unprofitable, and why it is driving him out of business.

The Baptists are told hard-working poor families will enjoy richer lives, but it’s rarely mentioned that young people looking for summer work or just starting out will find it much harder to reach that first rung on the career ladder.

As Glenn Reynolds of Instapundit says:

The Los Angeles Times report somehow fails to list union workers among the winners. They earn quite a bit more than the minimum, but many of them have their pay scales indexed to the minimum wage. Unions also give heavily to Democratic politicians who support union-friendly issues like hiking the minimum wage.

And the losers? Anyone whose labor is worth less than $15 an hour, and who is about to learn the hard way that the real minimum wage is always zero.

They Wrote a Book On It: Economist Bruce Yandle (who coined the term “bootleggers and Baptists” in 1983) has a book out with co-author Adam Smith, Bootleggers and Baptists: How Economic Forces and Moral Persuasion Interact to Shape Regulatory Politics. Recommended for further study and examples, notably TARP, a $700 billion emergency response to the economic crisis of 2008 which ended up as a field day for bootleggers and rent-seekers.


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed

Malay Demonstration

Ethnic Malay demonstration – AFP PHOTO / MANAN VATSYAYANA

Malaysia is another country where attempts to reserve places in education and jobs for certain ethnicities have led to strife and ongoing political problems. The Malays arrived on their peninsula thousands of years ago via Indonesia, and while originating in the same broad migration to Asia as the Chinese, are noticeably different in appearance and culture. British rule beginning in the 1870s brought new mines and rubber plantations which imported Chinese and Indian laborers, as well as a Chinese cosmopolitan business and commercial population in the cities. The Chinese population of today is still split between a wealthier city population and the poor, largely rural descendants of miners.

About half of today’s Malaysian population are ethnic Malays, while 30% are of Chinese descent and 8% are of Indian origin. Japanese occupation in WW2 was welcomed by some Malays, and with negotiated independence from Britain in 1957, the new Malaysian constitution reserved special status for Malays. Race riots between Chinese and Malays occurred frequently through the 1950s and 60s, and Singapore was expelled to become a separate country in 1965 since its largely Chinese population resented rule by the Malay-dominated Malaysia. Thus Malaysia eliminated from its polity the population of Chinese who dominated Singapore and were the source of much of the opposition to those Malay-preference policies.

A deeper dive into the history of the Chinese in Malaysia:

The situation of the 7 million ethnic Chinese in Malaysia is tentative at best, mainly due to the dichotomous and contradictory social roles played by two divergent elements within the Chinese community: the rural-poor and the urban-commercial sector. The urban-commercial sector of the ethnic-Chinese community, in conjunction with foreign (mainly British) interests, completely controlled the country’s economy. The ethnic-Malays countered Chinese economic clout by institutionalizing Malay dominance in the newly independent (1957) Malayan state.

Communal tensions had become pronounced following the Japanese occupation during World War II. The Malays at first sided with the Japanese against the British colonial administration but became increasingly disillusioned with Japanese dominance. The Chinese, on the other hand, were badly mistreated by the Japanese authorities (and their Malay collaborators) and many joined an armed resistance group, the Malayan People’s Anti-Japanese Army (MPAJA). After the Japanese defeat, the MPAJA attempted to establish political control in the Malayan peninsula and engaged in a violent retaliation against suspected Malay collaborators. Ethnic violence flared throughout the peninsula….

Malay distrust of the Chinese (and Indian, see separate entry) “foreign element”, stimulated by the MCP insurgency and exacerbated by the ethnic tensions displayed during the aborted incorporation of the Chinese-dominated island of Singapore (1963-1965), erupted into serious communal rioting in the summer of 1969 following a successful Chinese and Indian electoral challenge to the Malays’ political hegemony. The legal imposition in 1970 of the New Economic Policy (NEP), designed to redress “bumiputra” (all groups indigenous to Malaysian territory) economic disadvantages, was the important result of the 1969 disturbances. The NEP, however, tended to assign remedial advantages only to ethnic-Malays. It thereby buttressed Malay political and military dominance with economic power, mainly to the disadvantage of the aboriginal peoples and Indian groups.[1]
 

Malay, Chinese, and Indian communities tended to remain separated by language and culture, educated in separate schools and socially isolated. Resentment between the groups has built up over generations, and the continuing preferences for bumiputra breed more resentment, while Malay politicians continue to scapegoat the Chinese. An anecdote from a review of Thomas Sowell’s book Affirmative Action Around the World:

In 2004 while on cruise (I was active duty in the Navy at the time), our ship arrived in Port Kelang, Malaysia, not too far from the capital of Kuala Lumpur. A bus took us sailors into the city and cabs were lined up calling for Americans to get into their taxis despite a group of al-Qaeda sympathizers threatening to attack Americans…. Me and few friends hop into the cab and the guy seemed so nice but suddenly he went into a racist rant about Chinese people. He also hinted that some cabs refused service to the Chinese. I was shocked. If people of Chinese heritage were born in Malaysia, was it lawful for this man or any other ethnic Malay to refuse service? … I realize that affirmative action in that country may have played a part in it. I don’t want this for our country.

From “A Never-Ending Policy,” a story in The Economist of 4-27-2013:

The policies which favour ethnic Malays and other indigenes at the expense of Malaysia’s ethnic Chinese and Indian citizens are an oddity in the realm of state discrimination. It is not unusual that they favour a majority, the two-thirds of the population known as the bumiputra, or sons of the soil. But it is peculiar that their Chinese and Indian targets have never ruled Malaysia.

Their presence in the country, though, was encouraged under British colonial rule without the consent of native Malays. After independence this became a source of grievance, one exacerbated by the minorities’ wealth. In 1969 mobs burned Chinese shops, killing hundreds. The government responded with a “New Economic Policy” (NEP) aimed at improving the lot of the bumiputra with preferences in university admissions and for civil-service jobs. Billed in 1971 as a temporary measure, the NEP has become central to a system of corrupt patronage….

Provisions that require a certain proportion of the shares of any publicly quoted company to be in bumiputra hands, and that favour bumiputra-owned firms for various government contracts, undoubtedly enrich a few well-connected Malays. And the policies seem good for bumiputra civil servants: the civil service is now 85% Malay, if one excludes teachers. But they do little for the rest. “There has been little or no trickle-down effect, and I think more bumiputra know this today,” says Wong Chen of Pakatan Rakyat, the main opposition party. The increasing wealth of ethnic Malays in past decades echoes rising fortunes across South-East Asia, casting doubt on the idea that affirmative action has been a particular help.

Malaysia’s Chinese and Indian citizens chafe at being second-class citizens. Quotas in university admissions are particularly resented. Most universities in Malaysia reserve 70% or more of their places for bumiputras. Chinese and Indian students flock instead to private and foreign ones. Those who leave often stay away. A World Bank study in 2011 found that about 1m Malaysians had by that stage left the country, which has a total population of 29m. Most were ethnic Chinese, and many were highly educated. Some 60% of skilled emigrants cited “social injustice” as an important reason for leaving Malaysia. This exodus makes it a less attractive place to invest in.

Supporters of the NEP argue that, without such assistance, Malays will not catch up economically or academically. Critics worry that it dulls their incentives to excel. There is evidence of a skills gap. Nearly half the managers at Malaysian manufacturing firms surveyed by the World Bank said that the ability of local skilled workers to handle information technology was either “poor” or “very poor”. Mahathir Mohamad, a former prime minister who in his time extended the reach of the NEP, lamented in 2002 that bumiputras too often treat university places as “a matter of right”, neglecting their studies.

A survey in 2008 found that 71% of Malaysians agreed that “race-based affirmative action” was “obsolete” and should be replaced with a “merit-based policy”. The ruling coalition pays lip service to such ideas and has tinkered with the racial preferences—lowering, for example, the fraction of a company’s shares that has to be in bumiputra hands when a service company goes public. The opposition argues for “colour-blind” affirmative action—that is, policies that favour the poor in general, rather than the bumiputra specifically. But are enough of the sons of the soil ready to make the change?[2]

So the ethnic preferences are pushing highly-educated citizens to leave the country and are seen by most thoughtful observers to badly need reforming, yet nothing is changed.

Another feature of the Malaysian preferences also seen elsewhere is their continuation and expansion long after imbalances have been corrected. The Malay population has become an even larger majority in the years since the policies were implemented, and Malays now dominate the country’s government and most of the wealth and jobs. Asia-Pacific regional magazine The Diplomat goes into more depth in its story of 11-20-2015 by Han Bochen, “Malaysia’s Chinese Diaspora: The Other Side of the Story: Conventional narratives overlook the marginalization of ethnic Chinese in Malaysia — especially the Chinese poor.”:

While the Chinese do hold political power as part of the ruling coalition, it is their success in the economic realm that has been the main source of dissatisfaction for ethnic Malays. Right-wing groups often complain about a Chinese take-over of the country’s economy, and encourage ethnic Malays to unite under the idea of “ketuanan Melayu”, or Malay pre-eminence, against the Chinese domination of the economy. Ordinary Malays have adopted the rhetoric as their own, using social media as a tool to speak out against any indication that the Chinese are second-class or disadvantaged.

Looking purely at numbers, it does seem that the Chinese have it much better. Census data from 2014 show that the average monthly gross income for the Chinese is much higher than that of any other ethnic group in the country. Adding to this narrative are lists like the Forbes’ 50 Richest, which consistently reveal that the majority of Malaysia’s richest are of Chinese descent (in 2015, eight of the top 10 Malaysian nationals on the Forbes’ list were Chinese).

Under this banner, two intertwined narratives have been consistently marginalized: that of the mirage of Chinese dominance in Malaysian society, and that of the Chinese poor.

First of all, despite the lack of indication in the Malaysian constitution, there’s no debate over the fact that the prime minister must be of Malay origin, meaning that Chinese political power will always hit a brick wall. Furthermore, there is little support from the Chinese community for the Malaysian Chinese Association (MCA), the voice for the ethnic-Chinese population in government. Political observers agree that, that while they are vocal in the opposition, the Chinese have a largely insignificant voice in Malaysian parliament.

Secondly, it is the Malays, not the Chinese, that actually control most of the economy. Since the enactment of the New Economic Policy (NEP) in the 1970s — a set of affirmative action policies for ethnic Malays aimed to reduce inequality between them and their ethnic-Chinese counterparts — the Malays have monumentally improved their situation. They control most of the major banks, including the central bank, the government-linked companies (GLCs), as well as constitute the majority of the top professional and highest-paying occupations in the private sector.

What the impressive statistics touting Chinese success obscure is that while there is a sizable ethnic Chinese middle class, income inequality is also most rampant within the Chinese population. All the wealth is concentrated within a few, and there is a large number of Chinese who are either below the urban poverty line or slightly above the poverty line. Furthermore, while many of the NEP measures are still in force protecting the ethnic-Malays, there is relatively little government support for non-Malays in poverty. Correspondingly, there is a dire lack of academic study and census focus on the Chinese poor.

Meanwhile the government certainly isn’t helping matters with its rhetoric. The “Bangsa Malaysia” policy introduced in the 1990s, aimed to create an inclusive national identity for all Malaysian residents, has evolved into a nebulous concept. Over the years the government hasn’t ceased to refer to the ethnic Chinese as “pendatang,” which means “immigrant” in Malay. Such language confirms, and often exacerbates, the distinctions that exist between Malaysian nationals. In early February Rural and Regional Development Minister Datuk Seri Ismail Sabri Yaakob used racial language to encourage Malay consumers to boycott Chinese-owned businesses that have been raising their prices.[3]

For a look at the Indian-origin Malaysians who are also chafing under ethnic set-asides, The New York Times story of 2-10-2008 by Thomas Fuller, “Indian Discontent Fuels Malaysia’s Rising Tensions,” has some revealing anecdotes:

KUALA LUMPUR, Malaysia — Malaysian Indian Casket, a shop on the outskirts of this modern and cosmopolitan city, sells coffins in all sizes: standard coffins clutter the entrance, child-size boxes are stacked high on the shelves and extra-large models, those for the tallest of the deceased, are stored in the back.

But there is no variety in the ethnic background of the clientele.

“All the customers are Indian,” said Aru Maniam, a shop salesman.

In death as in life, Malaysians are divided by ethnicity. The country’s main ethnic groups — Malays, Chinese and Indians — have their own political parties, schools, newspapers and, in the case of Malays, a separate Islamic legal system.

For years this segregation was promoted as the best formula for social harmony in a country that advertises itself as “Truly Asia” because of its diversity, but where the memory of ethnic riots in 1969 is invoked as proof of the fragility of cross-cultural relations. Nearly 200 people died in that spasm of violence.

Now, ethnic tensions are again rising, driven in large part by dissatisfaction among the country’s Indians, who have mainly lost out in the long battle of all three ethnic groups over power, privilege and religion….

Some Indians in Malaysia are very rich, but a majority have not been able to move up from the lowest rungs of society. The children and grandchildren of rubber tappers, they remain poor, poorly educated and overrepresented in menial jobs….

Chinese Malaysians, who form the core of the merchant class, are angry about quotas that keep many of them out of local universities and about the government’s preference for hiring Malay companies, among other issues.

Malaysia’s ethnic tensions were born during the 19th and early 20th centuries, when Chinese and Indian workers came to what was then called Malaya and helped drive the colonial economy of tin and rubber. But this influx created resentment among Malays, who lost control of the economy to British plantation owners and Chinese businesses. The Malay sultans later struck a deal with the British: Malays would retain political supremacy in Malaysia after independence in exchange for citizenship for the Chinese and Indians.

Underpinning the anger of the latest generation of Chinese and Indians is an affirmative action program in place for 37 years that favors Malays and other indigenous ethnic groups, collectively known as bumiputra, literally “sons of the soil.” The program was devised to increase the share of bumiputra ownership of the economy, which in the 1970s was in the single digits.

Today, bumiputra make up 60 percent of the population but have 87 percent of government jobs. They receive discounts of 5 to 10 percent on new homes and are allotted 30 percent of stock shares in initial public offerings. Newspapers are filled with notices of government construction contracts exclusively reserved for companies controlled by bumiputra.

“It’s completely unacceptable that you cannot get awarded a contract just because of the color of your skin,” said Lim Guan Eng, an ethnic Chinese Malaysian who is secretary general of the Democratic Action Party, the leading opposition party in Parliament. “That grates tremendously. We are treated as though we are third- or fourth-class citizens.”[4]

In the United States, the preference system got started as a remedy for the evils of slavery and Jim Crow segregation and has never been as extreme as the Malaysian preference scheme, which was motivated by a colonial history. But similar resentment is building among those who are pushed out by the preferences for politically-favored groups. The US is fortunate in having less extreme ethnic and religious differences to deal with, as well as an ideal of equal treatment under the law, but the political rewards of setting groups against each other and stoking resentment are similar.


[1] “Chinese in Malaysia,” originally an article from U. Maryland’s College of Behavioral and Social Sciences, copied to: http://www.eng.fju.edu.tw/worldlit/link/malaysia_chinese.htm
[2] “A Never-Ending Policy,” The Economist, 4-27-2013 (author unnamed) http://www.economist.com/news/briefing/21576654-elections-may-could-mark-turning-point-never-ending-policy
[3] The Diplomat, Han Bochen, 11-10-2015. “Malaysia’s Chinese Diaspora: The Other Side of the Story: Conventional narratives overlook the marginalization of ethnic Chinese in Malaysia — especially the Chinese poor.”
[4] The New York Times, 2-10-2008, Thomas Fuller, “Indian Discontent Fuels Malaysia’s Rising Tensions”: http://www.nytimes.com/2008/02/10/world/asia/10malaysia.html


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

If you have a good story or anecdote from your organization, please email it to jebkinnison@gmail.com. I can use a few good tales (anonymized, of course) to illustrate the problems.

Trump World: “Art of the Deal” Zero-Sum Thinking

Art of the Deal Cover

Art of the Deal Cover – Amazon

Scott Alexander has read Trump’s The Art of the Deal to gain what insights he can. The tl:dr summary: Trump loves deals and can make things happen by working around bureaucracies and finding the Best People, but he doesn’t question the corrupt system he works in or show any sign of wanting to reform it. He wants more than his share of a fixed pie:

He had a couple more stories like this – but throughout all of it, there was a feeling of something missing. Here is a guy whose job is cutting through bureaucracy, and who is apparently quite good at it. Yet throughout the book – and for that matter, throughout his campaign for the nomination of a party that makes cutting bureaucracy a big part of their platform – he doesn’t devote a lot of energy to expressing discontent with the system. There is no libertarian streak to Trump – in the process of successfully navigating all of these terrible rules, he rarely takes a step back and wonders about a better world where these rules don’t exist. Despite having way more ability to change the system than most people, he seems to regard it as a given, not worth debating. I think back to his description of how it’s all just a big game to him. Most star basketball players are too busy shooting hoops to imagine whether the game might be more interesting if a three-pointer was worth five points, or whatever. Trump seems to have the same attitude – the rules are there; his job is to make the best deal he can within those rules.

So should he win, the optimistic view is that he will centralize and bully his way through the system as it is, ignoring any need for systemic reform. Like one of the better late Roman emperors, he might make some creaky old bureaucracies work better — as with Mussolini, the trains might run on time. But the current opportunity for a radical reform of the administrative state will pass. And after him, le deluge.

More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

Death by HR: History and Practice of Affirmative Action and the EEOC

Death by HR

Death by HR

Affirmative action (AA) was an outgrowth of the Civil Rights movement in the United States (1954-68), which culminated in the passage of the Civil Rights Act of 1968. The term was first used in US law in President John F. Kennedy’s Executive Order 10925 signed in 1961,

…which included a provision that government contractors “take affirmative action to ensure that applicants are employed, and employees are treated during employment, without regard to their race, creed, color, or national origin.” In 1967, gender was added to the anti-discrimination list. In 1989, the International Convention on the Elimination of All Forms of Racial Discrimination stipulated (in Article 2.2) that affirmative action programs may be required of countries that ratified the convention, in order to rectify systematic discrimination. It also states that such programs “shall in no case entail as a consequence the maintenance of unequal or separate rights for different racial groups after the objectives for which they were taken have been achieved.”

As originally envisioned, affirmative action was intended to reform the previous institutional discrimination against blacks and other disfavored minorities by making special efforts to recruit them and increasing their representation in higher education, company workforces, and government employment. The ultimate goal was colorblind treatment — to establish equality of opportunity for all the formerly-disfavored with the formerly-favored. At the time, the end of such “temporary” policies was foreseen as a generation or two away, when the need for such special treatment would have faded away as systemic racism and sexism would have been overcome and equal opportunity restored.

In the United States, affirmative action was first applied to racial discrimination in part to redress the wrong of slavery and Jim Crow laws in the South, but then extended to other minorities and women. India attempted to reduce the unfairness of the caste system there by implementing quotas and set-asides. Malaysian policy reserves special benefits for ethnic Malays,[2] in an effort to reduce the dominance of ethnic Chinese and Indians in the economy.

In each of these cases, affirmative action had damaging side-effects. Beneficiary groups were often poorly-defined, with racial preferences in the US often assisting relatively privileged black people whose families in many cases had recently immigrated and who had never suffered from the cultural and economic oppression of slavery. Cynics started to assume all new hires who might have benefitted from AA were less qualified (as indeed, on average, they were), a stigma which prevented even the beneficiaries from feeling totally responsible for their own successes. As AA programs aged and became institutional sacred cows, some minorities (like Asians) were dropped from the classes being favored, AA became more controversial, and a backlash began.

In 1978, the Supreme Court ruled in University of California v. Bakke that racial quotas were impermissible as a violation of the Equal Protection Clause of the Fourteenth Amendment, but that a candidate’s race could be considered as one factor in achieving a more diverse student body. In 2003, the Supreme Court ruled again that race could be considered as a factor, though narrowing its use further. Race preferences in admission became a political football, with public institutions trying to hide the extent to which they discriminated against Asian and white candidates in favor of blacks and Latinos because they knew the programs were political poison. In the meantime, sex discrimination had more than disappeared in college admissions, with the majority of admitted and graduating students at most universities now female; some have called for affirmative action programs to benefit males since they now are well below 50% of enrollments.

In the US, the Equal Employment Opportunities Commission (EEOC) is the executive agency which enforces the employment antidiscrimination laws:

The EEOC was established on July 2, 1965; its mandate is specified under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967 (ADEA), the Rehabilitation Act of 1973, the Americans with Disabilities Act (ADA) of 1990, and the ADA Amendments Act of 2008. The EEOC’s first complainants were female flight attendants. However, the EEOC at first ignored sex discrimination complaints, and the prohibition against sex discrimination in employment went unenforced for the next few years.

Any individual who feels they have been discriminated against can file a complaint with the EEOC. If the case when investigated appears to be a violation of the law, the EEOC will try to negotiate a settlement with the employer, and if that fails, may file suit to enforce the law. If there appears to have been no outright violation of law, the EEOC will issue a Notice of Right to Sue, which allows the complainant to file suit privately — this appears to put the EEOC in a position to forestall a rush of groundless lawsuits in the courts, since they may also find the complaint so worthless that it doesn’t require investigation and they won’t give the complainant their imprimatur for a private lawsuit.

The EEOC requires employers to report the racial and ethnic categories of their employees. These categories are defined by the Office of Management and Budget periodically; currently they are the same classifications used by the US Census. The overlapping category “Hispanic or Latino” covers an immensely varied population of multiple races, ethnicities, and languages; the Asian category includes an even more varied collection of peoples. The absurd complexities are laid out in an official EEOC document. Employers are expected to “encourage” employees to declare themselves in the appropriate category, and there is no standard other than self-declaration.

These reports can be used to allege discrimination without any other evidence when the composition of a workforce diverges from the local population under the “disparate impact” theory — the variation is assumed to be evidence that some discrimination must have occurred. The EEOC only acts on this when there is political hay to be made; the disparate makeup of elementary school teachers (primarily female), garbagemen (primarily male), and other obvious examples of disparities resulting from group preferences are never acknowledged.

An example of politicized abuse of the disparate impact theory occurred under President Carter in 1980:

The EEOC has been criticized for alleged heavy-handed tactics in their 1980 lawsuit against retailer Sears, Roebuck & Co. Based on a statistical analysis of personnel and promotions, EEOC argued that Sears was systematically excluding women from high-earning positions in commission sales, and was paying female management lower wages than male management. Sears counter-argued that the company had in fact encouraged female applicants for sales and management, but that women preferred lower-paying positions with more stable daytime working hours, as compared to commission sales which demanded evening and weekend shifts and featured drastically varying pay. In 1986, the court ruled in favor of Sears on all counts, noting that the EEOC had not produced a single witness who alleged discrimination, nor had the EEOC identified any Sears policy that discriminated against women.

The Equal Employment Opportunity Commission (EEOC) can be viewed as an agency to take the side of the weaker party in allegations of discrimination against individuals by large organizations (mostly private businesses, but sometimes government agencies and nonprofits), where the employer has access to more information and can bring to bear on any dispute far greater resources. While seen as fighting for individuals who have been discriminated against, it also intercepts complaints and investigates them at low cost compared to class-action lawsuits, union strikes, and other mechanisms that might be employed by those seeking relief. The EEOC often negotiates settlements by informally adjudicating disputes and making it clear to the parties involved how an actual lawsuit might fare. After a complaint is filed, the EEOC investigates and either certifies it as justified — in which case either the aggrieved party or the EEOC may sue if a settlement is not reached. Other complaints may be found unwarranted, which makes a civil suit unlikely since attorneys working on a contingency fee basis will see the case as likely to fail, and thus not pay them well for their time.

Such agencies are rarely created solely to protect their supposed clients. Generally the business community prefers arbitration over the courts to save time and money, and jury awards are notoriously unpredictable, with some juries punishing what they view as bullying by awarding damages far beyond what the individuals involved could reasonably be said to have suffered. Thus this kind of agency is supported by both voters (who believe it protects individuals from unfairness) and businesses (who see its operations as more predictable and cheaper than the cost of court cases which might otherwise be filed against them.)

The downside of this, from the point of view of businesses, is that there is a very low barrier to filing a complaint — anyone can do so easily and cheaply, and complaints are often vague or on their face unsupported, but still must be investigated and dealt with by both the EEOC and the business. Complainants typically don’t understand the law and require assistance to either amend their original complaint to capture actionable offenses or limit their allegation to the pattern of behavior they can document. Many complainants give up during this process as their ability to respond and satisfy the agency is tested.

The EEOC takes into account known abusers of its process and can deny complaints based on a record of such abuse:

Abuse of Process-§ 1614.107(a)(9)Section 1614.l07(a)(9) is the appropriate provision under which an agency may dismiss a complaint on the extraordinary grounds of abuse of process.

(a) Abuse of process is defined as a clear pattern of misuse of the process for ends other than that which it was designed to accomplish. …

For example, in reviewing a complainant’s prior complaints, the Commission has found abuse of process where the complainant presented similar or identical allegations, evidencing a pattern of initiating the complaint process whenever the agency did anything that dissatisfied the complainant. … The Commission has stressed in such cases that a party cannot be permitted to utilize the EEO process to circumvent other administrative processes; nor can individuals be permitted to overburden the EEO system, which is designed to protect individuals from discriminatory practices.


Example: The complainant originally filed a complaint of discrimination in non-selection for promotion. Subsequently, he repeatedly files complaints of reprisal, alleging that the agency was denying him official time to prepare EEO complaints, denying him the use of facilities and storage space for his EEO materials, providing improper EEO counseling, and unfairly keeping tabs on the amount of official time he is spending on his EEO complaints. Many of the allegations in these complaints are vague, and raise allegations previously raised in earlier complaints. In fact, he had on several occasions copied a previous complaint on which he would write a new date in order to file new complaint. Over the course of several months, he filed a total of 25 complaints in this manner. The agency could consolidate the subsequent complaints and dismiss them under § 1614.107(a) for abuse of process. The complainant had demonstrated a pattern of abuse of the process, involving multiple complaints containing identical or similar allegations. (See, e.g., Kessinger v. U.S. Postal Service, EEOC Appeal No. 0197639 (June 8, 1999); Story v. U.S. Postal Service, EEOC Request No. 05970083 (May 22, 1998)).


If the complaint is found by the EEOC to be reasonable and settlement isn’t reached, the resulting court case can cost an employer far more than a year’s wages for several employees. Business disruption costs and expenses for attorneys, discovery, and court time can easily reach hundreds of thousands of dollars, which is why small cases involving one or a few employees will typically be settled. When the case is unfounded and alleges mistreatment of a larger number of people or far-reaching changes in an employer’s practices would be required to settle it, going to court can be the lower-cost solution.

Cases reaching court have declined in recent years, from 465 in 1999 to 174 in 2015. The vast majority of the 90,000 cases filed annually are resolved before reaching court. As with criminal plea bargains, settlements often occur regardless of guilt, since the cost of a business going through a court process to reach dismissal or a finding in their favor is so high. Justice is rough at best, and it’s fair to say that many people who have been discriminated against are never aware of it or able to prove it, much less go through a complicated and damaging process for relief. It is almost always wiser to move on to a new employer or transfer within a company to avoid the downside of becoming a complainant. Defenders of the EEOC and the law would say that despite the uneven and inequitable enforcement, it has achieved greater sensitivity to the issue in businesses that might otherwise not have reformed their processes or taken note of low-level management prejudices. It is an unanswerable question whether the costs outweigh the benefits, or whether competition for good employees would have tended to lead to the same reforms without the overhead.

There is a complicated interplay between agencies like the EEOC and the NLRB and labor advocates and plaintiff attorneys. In recent decades, Democratic administrations have tended to support labor union and plaintiff attorney interests, while in Republican administrations, business concerns tend to be heard more clearly by the appointed administrators. Some decisions by the agencies under the Obama administration appear to have been aimed at increasing revenues for the plaintiff attorneys and giving unions more power to organize and negotiate with employers. Since both unions and plaintiff attorneys are major Democratic donors, this has the appearance of payoffs to donor classes.

From the LinkedIn Pulse article dated 2-24-2106, “Employers Deserve ANSWERS about EEOC’s Position Statement Policy”:

Last week, EEOC Commissioner Chai Feldblum reissued the EEOC’s press release, “EEOC Implements Nationwide Procedure for Releasing Respondent Position Statements and Obtaining Responses from Charging Parties,” claiming that this new procedure “will help make for better investigations.” As a former EEOC Trial Attorney, this statement so perplexed me that I could not help but attribute it to absolute ignorance about Field operations or outright mendacity.

Under the EEOC’s longstanding Priority Charge Handling Procedures (PCHP, adopted in 1995), the EEOC’s “investigations” are so perfunctory for the majority of charges (i.e., “B” charges) that they hardly resemble “investigations” at all: “B” charges are “handled,” not “investigated,” and according to the EEOC’s own data, nearly two-thirds of them are dismissed with No Reasonable Cause determinations. Notably, the EEOC’s budget has not grown commensurately with its more recent administrative power expansions, which means that the overwhelming majority of its investigations will remain as superficial and cursory as ever, while the EEOC devotes its limited resources to the 3.5% of charges (i.e., “A” charges) that may have merit.

So, who profits from this EEOC policy? For Plaintiff-side attorneys like EEOC Chair Jenny Yang and her ilk in the National Employment Lawyers Association (NELA) and the National Trial Lawyers Association (NTLA), this policy is a gift. Employers lose, as usual, in the EEOC’s and Plaintiff bar’s irrational “Victim/Villain” view of employment disputes.

[A]n EEOC Charge (Form 5) need only be “minimally sufficient,” simply consisting of “a written statement sufficiently precise to identify the parties, and to describe generally the action or practices complained of.” 29 C.F.R. 1601.12(d). As both an EEOC Trial Attorney and longtime EEO defense attorney, I have seen many, many “minimally sufficient” charges like the example below:

“I am a disabled woman over 40 years old, and believe I was discriminated against because of my disability, gender, and age in that:
I performed my position reasonably well; The employer terminated my employment despite my adequate performance; Other employees not belonging to protected groups with similar infractions or performance deficiencies were not terminated.”

According to the EEOC, Respondents are entitled to no additional information to conduct their investigations, evaluate the merits of the allegations, or assess their litigation risk, leaving them to wonder: What disability? Who does she consider “comparators”? What is she talking about? We fired her for poor performance!

Instead, from these scraps of information, Respondents must literally guess about the precise nature of the allegations and then effectively disprove them in a carefully drafted Position Statement supported by documents. Under the EEOC’s nationwide policy, an EEOC investigator will then provide this Position Statement and documents to the Charging Party and her attorney for rebuttal–i.e., the Charging Party’s first written statement and supporting documents that discrimination actually occurred. The EEOC will NOT provide this rebuttal information to Respondents and their defense counsel, even though the EEOC regularly issues determinations and makes conciliation demands based only on that limited information. Likewise, the EEOC routinely refuses to disclose investigative information to Respondents in the conciliation process, thereby allowing EEOC personnel to bluff about the quantum and quality of evidence in settlement negotiations.

From a strategic perspective, therefore, the EEOC has provided an informational windfall (i.e., “free discovery”) for trial lawyers: trial lawyers get full access to information to bolster their lawsuits against employers, while employers remain clueless about the precise nature of the allegations.


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

“Sublime Narcissism” – Freddie deBoer

Social Justice: Listen and Believe!

Social Justice: Listen and Believe!

Freddie deBoer spends time on Twitter so you don’t have to, and thinks independently instead of being a herd creature (which doesn’t let you off the hook.) Today in his post The Sublime Narcissism of Getting Offended On Other People’s Behalf he tears into the faddish accusation of cultural appropriation and other efforts to condemn behavior on behalf of someone else who shows no sign of being offended:

A few months back I got into a Twitter argument about the uselessness of complaints about cultural appropriation, in particular a muscular form that takes it as offensive to consume the goods of cultures to which one does not belong — food, clothing, music, and so on. I pointed out the usual problems with this thinking. All culture is hybrid; there is no place where legitimate appreciation ends and shameful appropriation begins; a world without cultural borrowing is a bleak and terrible place; and as I’ve said many times, saying “you should only consume that which comes from your own culture” is functionally identical to the efforts of white supremacists to keep the people pure.

Maybe most importantly, given that cultures are always large, diffuse, and made up of lots of different people, the idea of appropriation has to inevitably posit some ideal member of the group, when in reality all cultures are made up of many people. I had very earnest Twitterers telling me that American Chinese food is appropriation, not seeming to grasp that it was Chinese people who spread their cuisine in the United States, in order to make a living. In much the same way, thought white people doing yoga has been attacked as cultural appropriation, it was in fact a concerted effort by Indian people to spread the practice that has caused it to become an economic juggernaut in the West. Certainly members of those cultures can get mad at the other members of the cultures who spread these things. But they can hardly do so by claiming cultural appropriation on the part of those who they disagree with. Nor can any of us from outside those cultures rightly decide who’s an “authentic” member of the Chinese or Indian culture. But in order to make these complaints, you have to: you are, by definition, asserting a right to define the authentic for a culture you don’t belong to in order to claim that the authentic has been somehow corrupted.

This doesn’t mean that a person who is deeply knowledgeable in a culture other than their own is not allowed to point out deficiencies in how it’s portrayed or used. We’re free to note with amusement how tragically awful Hollywood was at depicting, say, African tribal culture in early movies. But those were not intended to be instruction manuals for diplomats. If all portrayals are to be examined for authenticity, most of our cultural production would fail. Which is beside the point: a story is told for values other than perfect fidelity, and if there’s a good-faith effort not to unfairly demonize another culture, that is better (no matter how flawed) than no attempt to bring in other cultures at all.

Some other recent “appropriation” controversies:

J. K. Rowling’s Pottermore extension of wizarding lore to the New World and Native Americans, attacked for insensitively using Navajo Skinwalker beliefs: Indian Country Today, N. K. Jemesin’s criticisms. Rowling is accused of doing “real harm” by fitting a modified Skinwalker belief into her fictional magical lore — in other words, she has committed heresy — or what would be heresy if she were Navajo. If Skinwalkers were central to her story, there might be some concern, but it’s a colorful detail which no one with any perspective would take seriously. Magic isn’t actually a real thing, and neither are skinwalkers. No one outside Navajo religious practice is required to do deep research to mention it in passing.

Two members of Bowdoin College’s student government to be impeached for holding a party featuring tiny sombrero hats. Realizing how foolish they looked, Bowdoin administrators have since backed down, but the knee-jerk accusations wasted everyone’s time and damage credibility when real issues might need to be addressed. Who would listen to such fools? The birthday party was set up by students, invitations sent out by a student of Colombian descent. Actual Mexicans and Latinos were not offended, any more than they would be by a Taco Bell.

One student of Guatemalan and Costa Rican heritage, freshman Brandon Lopez, pronounced the whole kerfuffle “mind-boggling” and called the disciplinary consequences a “travesty,” especially in light of the dining hall’s Mexican night a week later. (Lopez was invited to the party but could not attend because of baseball practice, he said.)

Freddy’s point is that this “concern on behalf of others” is itself condescending and betrays a belief that the other cultures are so weak and their adherents so helpless that sensitive progressives must come to their aid and appoint themselves judges of proper behavior toward the “lesser cultures.” And I will add this point about virtue-signalling generally (from a Facebook comment on his post):

It’s condescending to the individuals of the culture involved. It’s also most commonly intended to signal that the offended-on-behalf-of one is not only enlightened, but enlightened in an uncommon way so that those who don’t share their insight can be deprecated. Aimed at nearby tribal enemies. Which is why it doesn’t satisfy to condemn evils of greater magnitude that everyone deplores, like FGM and throwing homosexuals off buildings. “More empathetic and sensitive than thou.” A corollary sin of pride.

Trump World: Looking Backward

Cover: A Canticle for Leibowitz

Cover: A Canticle for Leibowitz

The children ask how we got here, and I try to explain, though so much has changed that my stories only lead to more questions — “What’s a news network?”, “How did people live without augments?”

We had a Republic, once, and it was wildly successful. That attracted more people from all over the world seeking freedom and work. It was freedom that let new industries grow unchecked by jealous rivals, but over time citizens sought shelter from the rigors of a free market and elected more regulation-prone politicians who tried to soften all the hard edges. Finally we reached a time so advanced that children were supposed to grow up without any challenges, to be deemed special and successful without any accomplishments, and the resulting adults became childlike in wanting to silence any voices that disagreed with them.

The world as a whole had benefitted from the opening of closed Communist countries and free trade, with the costs of transport and communication declining rapidly. The boom in emerging economies lifted billions of people out of grinding poverty, the greatest improvement in world living standards the world had ever seen, and increasing wealth and freedom defused the Malthusian fears of overpopulation and resource depletion of the previous decades. But the competition destroyed the protected world of US unskilled workers, who had gotten used to living well after WWII destroyed most of the manufacturing plants of Europe and Asia.

“The Sound of Silence” was a famous Simon and Garfunkel song, written in the 1960s to protest the conformity of an earlier era — the 1950s — when broad consensus and the limited number of mass media options stifled outlier opinions. Capitalism broke that mold, when “outrageous” ideas and lifestyles could be marketed and make money. Selling rebellion was big business.

The Internet seemed to end the constraints on opinion, but a new sound of silence appeared when its two-way nature allowed crowds to join together to silence expression of ideas they found threatening. People lost their jobs because of one errant tweet, and politicians found it useful to stoke the flames of envy and resentment to gain votes. A new victim cult appeared, seeing racism and sexism in every element of US life, and command of the cult’s lexicon enabled entry to academic and government positions.

The left-behind grew angry, and simmered in disability payments and painkilling drugs while they saw their children discriminated against by the gateway institutions built by their forebears. They had supported the growth of the Federal government through costly wars and the building of a social safety net, only to be left out and denigrated by their ruling class. Federal agencies were taken over by progressives and affirmative-action hires, and wasted time and resources shuffling reports and holding grand meetings to write about working toward solving problems that barely existed while neglecting their core functions. The levels of incompetence tolerated grew and grew, until civil service employees could hold their jobs after being absent for years or being discovered spending most of their time viewing Internet porn. Major new government programs and projects failed and billions of dollars were wasted without consequence, those responsible for the failures being promoted to further damage the private economy by ruling from Washington.

The new media were staffed by college graduates who had been subjected to progressive indoctrination, and rarely questioned what government sources told them. And how could they, since time had been sped up and in the Internet age, stopping to investigate original sources that might disagree would only bury their story in tomorrow’s old news?

Trump appeared after two decades of Washington-centered rule by two factions of the same technocratic party. He gained the support of the dispossessed by voicing their resentments, long suppressed by the bien pensant. His supporters were so tired of being told their feelings were incorrect and didn’t matter that they failed to notice that Trump had no fixed beliefs of his own, other than winning.

And win he did, up against Hillary Clinton, who everyone knew was a habitual liar and corrupt influence-peddler. After she was nearly indicted for her negligent handling of secret information, Trump the bully won the election handily despite the rioting in major cities and the crashing stock market.

Thoughtful observers saw this as a test of the Founders’ three-branch design. In theory, the checks and balances and separation of powers between the three branches of government would limit the damage he might do. In practice, previous administrations had accreted so much power in the office of President that Trump was able to run roughshod over good government concerns.

Trump terrorized the agencies and the civil service bureaucracy. His bully-boys formed a shadow organization which intimidated any civil servant who dared stand against him — his friends in the Mafia proved useful in extralegal persuasion. If regulations got in Trump’s way, they were rewritten. Favored people and corporations found their way smoothed, while others who failed to support him were blocked and gutted. In that, he was only a few degrees worse than his predecessor, but the collapsing private economy provided no alternative routes for survival. Almost everyone knuckled under to wait for better days.

The doctors grumbled when they were drafted to serve in the new Trump Medical Corps, but after their licenses were pulled when they refused, they fell into line. Trump took over hospital chains by eminent domain and staffed them with uniformed Corps personnel; he had personally overseen the design of the new uniforms, gold braid trim and all. Federal medical costs were cut by 50% as salaries fell and procedures deemed too costly were outlawed. The upper crustaceans, of course, joined new luxury practices and went to private hospitals, as they always had. Medical school enrollments dropped and quality of the applicants fell, as it became clear doctoring would no longer be a high-status occupation. Research on new drugs evaporated when the primary source of drug profits, the US, joined the rest of the world in controlling their prices.

Apple’s new iPhone assembly factory opened in south Texas, and their mostly-immigrant assemblers tried to duplicate the quality of the phones built by contractor facilities in China that had taken decades to develop. The US-assembled phones cost $200 more and failed more often, but Apple made the transition successfully since all of their competitors were similarly hobbled. And by opening their own manufacturing plant, they instantly reached the better employee diversity numbers they had been pretending to strive for for years.

The Chinese and Russians were relieved when Trump was elected — someone they could deal with without any unpredictable concerns with human rights to interfere. Deals were struck and trade managed. For awhile this seemed to work, though the people of Hong Kong and Ukraine felt abandoned as they lost their remaining independence. The EU collapsed in disorder as internal divisions and new migrations overwhelmed their governments.

And so it was that the opportunity society became the are-you-with-Trump society. Bribery came back with a vengeance. Inequality decreased, but only because more people were poor. The world economy had stalled, and grew worse as Trump’s new tariffs and trade barriers decreased world trade. The Chinese people grew restless when their standard of living began to drop, and the Chinese leadership started warring on neighbors to distract their people.

And that’s what I tell the kids. We came here to be safe, to guard our traditions, and to last through these times. The radiation is better now, and our growing huts get more sunlight than in those lean years right after. We have a good stock of electronics, drugs, and solar panels, and our store of knowledge and technology is intact. It’s safe enough to go outside for days at a time, and soon we will be able to travel to meet with others who survive.

We’ve had all the time in the world to teach our children where we went wrong. I’m hopeful that this time they’ll get it right.


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

Corrupt Feedback Loops: Justice Dept. Extortion

Attorneys General Holder and Lynch

Attorneys General Holder and Lynch

[Welcome Instapundit readers! Sign up on the sidebar or add the RSS feed if you want updates…]

We’re all familiar with the evil of bribery, in which someone pays a civil servant for favorable handling of a government decision. The briber gains profits that are some multiple of the bribe at the expense of the public; the bribed official’s malfeasance betrays the people who pay his salary.

Since the Code of Hammurabi, government officials have been punished for taking bribes or dealing in property related to their official decisions. In The Republic, Plato suggested government officials live communally without the temptations of private property to insulate their decisions from the temptations of personal gain. In Systems of Survival, Jane Jacobs wrote about systemic corruption when what she called the Guardian Syndrome (appropriate memes for governing and military classes) was corrupted by Commercial Syndrome considerations — and vice-versa. It is corruption if commercial actors use bribes to gain special favors at the expense of competitors and the public, and it is also corruption if government officials use their decisionmaking and spending power to influence private business or voters to give them an advantage over political opponents. Both forms of corruption break down accountability and result in a net loss in fairness and efficiency, leading to less dynamic public and private spheres. And the endpoint of such corruption in a country is stagnation, weakness, and defeat by an external enemy.

Outright bribery is common in developing countries, as the US was before the turn of the century. A less direct form of bribe which is harder to detect is campaign contributions for access and favorable handling, still quite common and legal in the US. The influence is not so much a direct payment for a favorable decision as a tendency to favor the interests of the campaign contributor, putting a thumb on the scales weighing the public interest. The modern version has an officeholder accepting a large number of contributions from both sides of various issues, especially when the officeholder is not a predictable supporter of either side. This bundling of interest-group contributions leaves out citizens who have no trade group or industry representing their interests. This is not ideal, but the commonly-suggested remedy of public campaign financing has the obvious problem of favoring the status quo and whoever decides which candidates deserve public funding. Individual wealthy contributors have provided the seed money for many outsider campaigns for public office, and if private contributions are limited, status quo politicians, with their free access to news media, are much harder to displace.

Another more subtle form of corruption is advertising and PR monies spent by the state at the direction of current officeholders for supposedly public purposes, but which greatly favor their own party or policies. A great recent example of this is the advertising for Obamacare and its insurance exchanges, and the “Navigators” hired to assist applicants in using the unusable Healthcare.gov web site. From the Kaiser survey, “More than 4,400 Assister Programs, employing more than 28,000 full-time-equivalent staff and volunteers, helped an estimated 10.6 million people during the first Open Enrollment period.” Doing the math, this means each navigator served about two people a day, and (especially at first) most of the time spent went to staring at nonfunctional screens and talking about the problems with the system. Navigators were hired with little concern for knowledge or trustworthiness, and information about becoming a navigator was spread via the network of “community activist” organizations that happened to reach out to the same sort of people who serve as political foot soldiers for Democratic campaigns. ACA implementation spent billions of dollars on politically-connected contractors for failed systems and hiring of connected patronage employees. The result was enormous waste and failure of the new systems, but with the politically-desirable side-effect of direct government-funded contact between poor citizens and activists for Democratic causes. This may have backfired since the program failed so obviously, but was motivated by the desire to give poor people a benefit while reminding them personally of the party that got it for them.

Because spending for Federal PR offices and advertising is buried as multiple items in each agency’s budget, it is hard to track. The GAO is launching an investigation to try to trace it, with obvious external advertising contracts adding up to $4.7 billion in 2009-2013 fiscal years:

The 2014 CRS report found it difficult to determine details on federal agencies’ advertising spending. There is no governmentwide reporting standard, CRS said, nor is there a common definition of what constitutes advertising. Additionally, agencies have “great discretion” to budget their in-house PR. Agencies are prohibited from spending money on “publicity or propaganda” not specifically authorized by Congress, but CRS found the lack of a firm definition of advertising has led to “few governmentwide restrictions” on the practice.

Government-funded PR offices send out press releases which end up as stories in the media, which typically don’t question the content — a “government source” is seen as credible. This allows slanted views of science, economics, and political issues to be presented as neutral fact with apparent consensus support — a typical press release from a government agency can result in dozens or hundreds of stories repeating the same information, and most media outlets won’t seek out any opposing viewpoints.

This means the party holding the executive branch can try to mold the views of the citizenry using propaganda funded by the citizens’ own tax money. When the executive branch is held by progressives who reinforce the generally government-favoring slant of the federal civil service employees, the depth of the disinformation provided increases. This is systemic corruption, and creates a powerful positive feedback loop toward larger government and shrinking private freedoms. Progressive politicians believe this is all to the good — because they know what is best for everyone and most citizens choose wrongly unless guided by the state and its social-working employees, it is totally legitimate for the state to enlighten its voters by programming their malleable minds with the correct ideas so that they will vote for the correct politicians, who happen to be them.

Overlawyered reports on a WSJ story (behind a paywall, unfortunately) discussing the fate of the $110 billion in fines paid by mortgage banks to settle with the Justice Dept.:

Following the 2008 crash, government enforcement action extracted $110 billion from lenders and other players over a variety of alleged sins relating to the rise and collapse of the mortgage bubble. Where did it go? Governments held on to a lot of it, a lot went to the government-sponsored Fannie and Freddie mortgage enterprises, favored “housing-related community groups” got some, some went to homeowners with mortgage struggles or to new low-interest loans. In New York, money is going to rebuild the Tappan Zee bridge and “the annual state fair is using bank-settlement money to build a new horse barn and stables.” But no one has kept track of where a lot of the money went, there being no overall effort to account for it.

Kimberly Strassel in the WSJ of 12/3/2015 commented on the phenomenon of fines extracted by Justice Dept. threats going to groups supporting the Democratic party:

Republicans talk often about using the “power of the purse” to rein in a lawless Obama administration. If they mean it, they ought to use their year-end spending bill to stop a textbook case of outrageous executive overreach.

This scandal comes courtesy of the Justice Department, which for 16 months has engaged in a scheme to undermine Congress’s spending authority by independently transferring dollars to President Obama’s political allies. The department is in the process of funneling more than half-a-billion dollars to liberal activist groups, at least some of which will actively support Democrats in the coming election.

It works likes this: The Justice Department prosecutes cases against supposed corporate bad actors. Those companies agree to settlements that include financial penalties. Then Justice mandates that at least some of that penalty money be paid in the form of “donations” to nonprofits that supposedly aid consumers and bolster neighborhoods.

The Justice Department maintains a list of government-approved nonprofit beneficiaries. And surprise, surprise: Many of them are liberal activist groups. The National Council of La Raza. The National Urban League. The National Community Reinvestment Coalition. NeighborWorks America (which awards grants to left-leaning community organization groups, and has been compared with Acorn).

This strategy kicked off with the $13 billion J.P. Morgan settlement in late 2013, though in that case the bank was simply offered credit for donations to nonprofits. That changed with the Citigroup and Bank of America settlements, which outright required $150 million in donations. The BofA agreement contains a provision that potentially tees up nonprofit groups for another $490 million. Several smaller settlements follow the same mold.

To further induce companies to go the donation route, Justice considers these handouts to be worth “double credit” against penalty obligations. So while direct forms of victim relief are still counted dollar-for-dollar, a $500,000 donation by BofA to La Raza takes at least $1 million off the company’s bill.

The purpose of financial penalties is to punish, and to provide restitution to real victims. The Justice Department would make the case that this money is flowing to groups that aid the targets of supposed banking abuse, such as homeowners. But that assumes the work these groups do is targeted at actual victims—which it isn’t. It assumes that the work these groups do in housing is nonpartisan—which it isn’t. And it ignores that money is fungible. Every dollar banks donate to the housing arms of the Urban League or La Raza is a dollar those groups can free up to wage an assault on voter ID laws, or to help out Democrats.

This kind of enforced donation to “public service” organizations that just happen to support the ruling party’s goals is correctly discouraged by Justice Dept. guidelines as possibly creating the perception of a conflict of interest. Not only does this improperly divert money which should have been returned to the customers of the banks, it appears to encourage the Justice Dept. to spend effort on industry-wide feints at prosecution of private companies regardless of actual guilt who are thereby extorted into paying huge fines. The businesses find it cheaper to pay the extortion money, and actual justice in the form of discovery and public knowledge of any provable violations of the law that may have occurred is never achieved. The public interest was not served and there is no accountability for any of the bad actors: those inside the banks, in the ratings agencies, or in the government regulatory agencies themselves. Unresolved, there is no clarity on what reforms might help avoid recurrence. And the President builds a bigger propaganda machine to mislead the voters and retain power for his party.

Tl;dr version: The banks were rescued (whether they needed it or not) and then propped up to earn big profits by Fed actions loaning them money at close to zero rates. The DoJ takes a cut from the banks and distributes the booty to favored groups and everyone goes back to business as usual. No banker suffers. My view is that the failures were systemic and no criminal activity could ever be found… the proper punishment should have been some bankruptcies. But that route had “insufficient opportunities for graft.”


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy