Rampant shoplifting leads to another Walgreens closing in S.F.

By Phil Matier of The San Francisco Chronicle. 

"After months of seeing its shelves repeatedly cleaned out by brazen shoplifters, the Walgreens at Van Ness and Eddy in San Francisco is getting ready to close.

“The last day is Nov. 11,” Walgreens spokesman Phil Caruso said

The drugstore, which serves many older people who live in the Opera Plaza area, is the seventh Walgreens to close in the city since 2019.

“All of us knew it was coming. Whenever we go in there, they always have problems with shoplifters, ” said longtime customer Sebastian Luke, who lives a block away and is a frequent customer who has been posting photos of the thefts for months. The other day, Luke photographed a man casually clearing a couple of shelves and placing the goods into a backpack.

“I feel sorry for the clerks, they are regularly being verbally assaulted,” Luke said. “The clerks say there is nothing they can do. They say Walgreens’ policy is to not get involved. They don’t want anyone getting injured or getting sued, so the guys just keep coming in and taking whatever they want.”

For security reasons, Walgreens declined to provide details on their security policies, but Caruso did say that “the safety of our team members and customers is our top concern.”

A recent trip to the store revealed aisle after aisle of empty or near-empty shelves. Beauty supplies appear to be a favored target.

Most of the remaining products were locked behind plastic theft guards, which have become increasingly common at drugstores in recent years.

But at Van Ness Avenue and Eddy Street, even the jugs of clothing detergent on display were looped with locked anti-theft cables.

When a clerk was asked where all the goods had gone, he said, “Go ask the people in the alleys, they have it all.”

Homeless encampments are common in the neighborhood, including two just across Eddy Street.

No sooner had the clerk spoken than a man wearing a virus mask walked in, emptied two shelves of snacks into a bag, then headed back for the door.

As he walked past the checkout line, a customer called out, “Sure you don’t want a drink with that?”

Just across busy Van Ness and down a block, a competing CVS pharmacy was fully stocked.

The difference? The CVS had a security guard at the door.

“Up there, they are closer to the Tenderloin. It’s the Wild West,” said a CVS clerk who was standing with the security guard.

The homeless encampments and the thefts at the Walgreens were front and center at a neighborhood town hall at St. Mary’s Cathedral in March.

Police responded by placing two officers and a squad car outside the store at the corner of Eddy and Van Ness.

“Everyone was happy,” Luke said.

But as the pandemic shutdown dragged on, the officers were needed elsewhere. And a short time later, the thieves returned in full force.

Why not?

Under California law, theft of less than $950 in goods is treated as a nonviolent misdemeanor. The maximum sentence for petty theft is six months in county jail. But most of the time the suspect is released with conditions attached.

The Van Ness location is at least the third Walgreens to close in the city in the past year. The Walgreens at 16th and Mission streets closed in December. The Walgreens at 730 Market St. closed in March.

It’s hard to pin down how much the market forces that prompted the closure of 200 Walgreens nationwide was a factor in the local closures and how much theft contributed — or if it was a combination of reasons.

In February, the local news website Hoodline reported that an employee at the Market Street store said the store couldn’t cope with the shoplifting, which was costing the company $1,000 a day.

“Organized retail crime in San Francisco has increased the challenge for all retail, and Walgreens is not immune to that,” company spokesman Caruso said.

Jay Cheng, public policy director for the San Francisco Chamber of Commerce, said the rising incidents of shoplifting and worsening street conditions have made it difficult for all neighborhood retail stores to continue to operate in San Francisco.

“We’ve already seen California Attorney General Xavier Becerra uncover a major Bay Area retail theft ring with over $8 million in stolen merchandise,” Cheng said. “These crimes make it dangerous for businesses, employees and customers, and need to be addressed.”

Some stores have hired private security firms or off-duty police officers to deter would-be thieves.

But security is expensive and can cost upward of $1,000 a day.

Add in the losses from theft, and the cost of doing business can become too high for a store to stay open. As for the customers at the Van Ness Walgreens, their prescriptions will be handled by the Walgreens at 1301 Franklin St.

At least for as long as it stays open."

The $500 billion "skinny" stimulus bill proposed by Senate Republicans is more in line with the current circumstances

Fool Us Once, Shame on You; Fool Us Forever, Shame on Us All by Veronique de Rugy.

"Why people continue to trust government officials is a mystery. Often disconnected from the problems at hand, their policies also often contradict their supporters' frequently expressed beliefs. While suffering from cost overruns and increasing budget deficits, these policies handsomely reward their cronies, too.

A good example is the latest attempt to pass yet another COVID-19 relief bill. House Speaker Nancy Pelosi called Republicans' failure to agree to her $2.2 trillion bill "malfeasance." Never mind that the White House's $1.8 trillion proposal was right up there with hers.

It's right to help those low-income Americans hurt by the pandemic-induced recession. But that relief bill shouldn't cost anywhere near $2 trillion. Think about this: When the economy was more solidly locked down back in March, unemployment was above 14%; growth was collapsing; people were scared; and when politicians were throwing all the money they could grab at anything that crossed their minds, Congress passed the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act. Today, unemployment is down by half; the economy is growing again; pretty much everything is improving; but both the Democrats and the White House still want another $2 trillion.

The $500 billion "skinny" stimulus bill proposed by Senate Republicans is more in line with the current circumstances.

Making matters worse, the White House and Democrats want to spend that $2 trillion on the same programs as before. Given the flaws exposed in the previously approved programs, this repetitiveness is inexcusable.

For instance, the $600 bonus unemployment benefit created incentives for workers to leave their jobs to collect the government payment. The government's Payroll Protection Program, or PPP, loans, administered by the Small Business Administration, were a disaster to implement. It also soon became known that most of the PPP loans went to areas relatively unharmed by the pandemic. And, let's not forget, the $25 billion airline bailout that was meant to prevent layoffs only postponed them until the beginning of October. The bailout, however, did clearly benefit shareholders and creditors.

The Congressional Budget Office tried to calculate the economic impact of these programs, and the results are underwhelming. For every dollar invested in unemployment benefits, we got a 67-cent return. The PPP returned 36 cents. Aid to state and local governments returned 88 cents on the dollar. The overall coronavirus relief bill returned 60 cents in economic growth per dollar invested. In other words, the COVID-19 relief was depressive, not simulative. Yet as a result, our budget deficit is now $3.3 trillion.

We might excuse the failure of these policies if they were, in fact, the product of a lack of time to consider the economic impact and consequences of the programs Congress was designing. But they have now had nine months to observe and consider new measures. And they still propose what is effectively the Coronavirus Aid, Relief and Economic Security Act 2.0.

Indeed, Pelosi's bill contains another round of payments up to $1,200 for individuals and $500 for each dependent, with more $600 weekly enhanced federal unemployment payments through January 2021, followed by a transition period through March 2021. It also provides for an extension of the Pandemic Unemployment Assistance program through the same period (January/March), $225 billion for child care and education, more funding for the PPP, another $25 billion airline bailout, and plenty of state and local government aid.

The White House proposal includes much of the same, minus an extension of the state and local tax deduction (which mostly benefits higher-income taxpayers) that Democrats have been pining for ever since it was capped by the Republicans' 2017 tax reform.

So, again, I ask, why do people trust politicians? Are our memories so faulty? Case in point: During the last presidential debate, Joe Biden claimed that no one lost insurance due to the implementation of the Affordable Care Act. That's a bold claim to make. That same statement, when made by former President Barack Obama as he pushed for the legislation before its implementation, was once named the "Lie of the Year" by PolitiFact. But Biden still felt it was safe to make such a claim.

If it's the case that politicians don't really try to pass policies that will succeed, keep the deficit low and tell the truth — because they can get away with bad policies, misleading claims and spectacular deficits — then shame on them. But if we keep letting them get away with this ruse, then the shame ultimately lies with us."

Defense Department study finds low risk of coronavirus infection through air on a packed airline flight

By Ian Duncan of The Washington Post. Excerpts:

"A Defense Department study of the risk of catching the coronavirus on a packed commercial flight concluded that a person would have to be sitting next to a infectious passenger for at least 54 hours to receive a dangerous dose of the virus through the air.

Researchers concluded, that if passengers wear surgical masks continuously, very little of the virus spreads because of how the air is circulated and filtered on the planes."

"The researchers, which included a team from the University of Nebraska, concluded that the virus was removed by the plane's air filtering systems 15 times as fast as in a typical home and five or six times as fast as what is recommended for hospital operating rooms and patient isolation rooms."

How a Pioneering Covid Testing Lab Helped Keep Northeast Colleges Open

Broad Institute of MIT and Harvard processes 45,000 Covid-19 tests a day for more than 100 colleges

By Melissa Korn of The WSJ. Excerpts:

"The samples are whisked off to Cambridge, Mass., 150 miles away, and processed alongside tens of thousands of others overnight at the Broad Institute of MIT and Harvard, a biomedical and genomics research center.

A primary reason many colleges in Massachusetts, New York, Maine and Vermont have experienced few coronavirus outbreaks this fall has been frequent, widespread testing. At 108 colleges and universities, that testing is being done within a carefully orchestrated system run by the Broad Institute. 

The testing, along with strict, state-level quarantine orders and low levels of community spread in the region, has helped keep infection rates at schools working with Broad below 0.2%."

"“We really borrowed a lot of industrial principles of how factories are organized and how factories plan their work,” Stacey Gabriel, senior director of the Genomics Platform said. “It’s an automated assembly line.”"

"The Centers for Disease Control and Prevention at first urged schools to focus on testing symptomatic individuals and played down the need for entry or surveillance tests. In a late-September update, however, the CDC said those measures combined “might prevent or reduce” Covid-19 transmission."

"A. David Paltiel, a professor of public health at the Yale School of Medicine who ran an epidemiological modeling study on the new coronavirus this summer, called that latest conclusion “disingenuous and unscientific.”

His study, published in the Journal of the American Medical Association, found that testing all students every two days may be the threshold for safe college operations. Just screening for symptoms led to broad-based Covid-19 outbreaks in the model.

“Testing is like an early-warning missile system,” said Laurie Leshin, president of Worcester Polytechnic Institute. By identifying a positive case quickly, she said, schools can “manage it before it does a lot of damage.”"

Beijing’s Covid Recovery Isn’t So Enviable

China touts GDP growth but faces a hard call: rest on a fragile economy or try for a difficult transition?

By Joseph C. Sternberg.

"Few myths are proving so durable in our pandemic age as the notion that China has somehow cracked the coronavirus code. It hasn’t.

The argument proceeds in two steps. The first is to assert that Beijing’s authoritarian approach to mass lockdowns, followed by intrusive testing and tracing, defeated the virus in a way almost no democratic government has managed. This might be true, but it is also meaningless. It does little good to argue in favor of Chinese methods to control a pandemic when a democratic society would by definition find that authoritarianism a cost not worth paying.

More interesting is the second prong of the Beijing-beats-the-world myth: the economy.

We’re supposed to believe that China’s success in suppressing the virus has facilitated a phenomenal economic recovery—and, by extension, that our economies would be growing again too if only we had batted down Covid-19 as efficiently. The claim was bolstered this week by more good news from Beijing’s statistics gnomes, who reported gross domestic product increased by 4.9% in the third quarter compared with the same quarter last year. China is set to be the only major economy that manages to grow this year.

This might even be true. Chinese economic data are notoriously, oh, what’s the word I’m looking for . . . fake. Headline GDP numbers tell you less about the real state of the economy and more about the Communist Party’s political preoccupations and goals. Still, there is substantial evidence that the Chinese economy is growing to some extent. Important and harder-to-fudge measures such as industrial production and retail sales have improved in recent months.

But ginning up economic growth has never been Beijing’s problem. Generating genuine, productive economic activity has been the difficulty. And on this front the pandemic is becoming a major disaster. The coronavirus immeasurably complicates Beijing’s efforts to engineer a long-overdue transformation of the Chinese economy away from reliance on exports and inefficient state-owned enterprises (SOEs) and toward domestic consumption by a middle class employed by productive companies.

To succeed, this transformation would require an enormous redistribution of resources—including some level of household income—away from the SOEs and their politically well-connected managers and employees and toward expanding the private sector.

This metamorphosis also would require a massive reallocation of resources within households. The middle class, accustomed to stockpiling its wealth in housing, would need to be cajoled into shifting its savings out of unproductive properties and into financial investments that support corporate productivity.

That process implies other households might see their housing wealth decline unexpectedly as evolving demand dings values. And Beijing would have to deliver wholesale regulatory and corporate-governance reforms to boost savers’ confidence in a financial system that currently operates like a cross between a casino, a Wild West saloon and the cantina from “Star Wars.”

What government in its right mind would want to attempt such a wrenching change in the middle of a global downturn? Not only has the pandemic created new domestic stresses such as rising unemployment and mounting indebtedness. Tenuous recoveries elsewhere raise questions about China’s ability to fall back on its export markets as a growth support while it attempts difficult domestic reforms.

Little wonder, then, that Xi Jinping appears ambivalent about pressing ahead with reform. He has made fitful noises about rebalancing, most recently over the summer with a vague “two circulations” program that envisions developing a vibrant domestic economy while also preserving the state-led export machine. But more recently he shied away. Last month he encouraged private firms to align themselves more closely with the interests of the party-state. This is inimical to a rebalancing program but is more consistent with Mr. Xi’s authoritarian impulses. Chinese entrepreneurs will get the message.

Which means China’s coronavirus experience has been the same as everyone else’s. The overarching economic story of the coronavirus is that it has interrupted important transformations that had been under way. In the U.S., the pandemic stunted an investment-and-jobs boom that was starting to reorient the economy toward faster productivity growth. In Europe the virus has disrupted the transition of both the European Union and the U.K. to a post-Brexit economic order.

The difference is that Western economies have the option of recovering from the virus by getting back on track—by extending the Trump-era deregulation agenda, or by redoubling efforts to finalize a free-trade agreement between the EU and Britain. (Whether they will exercise these options is another matter.)

China doesn’t have this choice. It can dig in its heels on a model that was showing signs of stress before, or it can attempt difficult political and economic changes at the worst possible global moment. Maybe Beijing is secretly jealous of us."

Red and Blue States of Recovery

Joe Biden’s ‘K-shaped’ economy is made in the lockdown states

WSJ editorial.

"The story that the media haven’t told is that states that have maintained longer and stricter business restrictions have been slower to recover. The unemployment rate in September was 12.6% in Nevada, 11% in California, 10.5% in Rhode Island, 10.2% in Illinois, and 9.7% in New York compared to 6.7% in Arizona, 6.4% in Georgia, 5.4% in Wisconsin and 5% in Utah.

New York added 100,000 jobs last month as Gov. Andrew Cuomo finally let dine-in restaurants and gyms in New York City reopen at limited capacity. But 363,000 workers also dropped out of the labor force, which was the biggest driver in the state’s 2.8-point decline in unemployment. New Jersey’s unemployment rate fell to 6.7% from 11.1%, but that's also largely because 229,000 workers left the labor force. The main cause of what Joe Biden calls the “K-shaped recovery” are Democratic governors that shut down their economies."

‘Sustainable’ Investing Is a Self-Defeating Strategy

If, say, oil stocks sell at low prices relative to earnings and prospects, those who buy them stand to gain.

By Burton G. Malkiel. Excerpts:

"ESG rating agencies supposedly fulfill the need by providing composite scores. These agencies range from specialized firms like Sustainalytics to large index providers such as MSCI. Business is booming, and these agencies are increasingly influential in determining how capital is allocated. The problem is that the scores from different providers disagree dramatically. Moreover, ESG ratings tend to be divorced from considerations of how environmental, social and governance performance can influence future financial results.

ESG raters can’t even agree on how to evaluate these companies when they consider the same attribute such as carbon intensity. Some examples will illustrate how difficult this can be.

Xcel Energy has one of the biggest carbon footprints in the electric utility industry. Xcel ranks poorly because it generates a substantial share of its power from coal. But Xcel is the first U.S. utility committed to going 100% carbon-free by 2050 and is a leader in building wind-generation facilities. Should we refuse to invest because of its carbon emissions, or do we approve of the company because of responsible investments that may ultimately lead to greater profitability?

Another example is Kinder Morgan, a gas pipeline company, which scores poorly for investors who eschew carbon-intensive energy. But natural gas is the cleanest-burning carbon, and to the extent that it can replace coal, environmental goals can be better achieved. And it is far safer to transmit gas through pipelines than by rail or truck.

Disagreements regarding ratings can be even more prevalent in industries with relatively low carbon intensity. Bank of America gets a below-average ESG score from one rating agency and a well-above-average rating from another. These disagreements arise because raters differ on how to measure and weigh ESG attributes. Raters are also influenced by their views of the company as a whole. As a result, there are large differences in individual ESG ratings for Intel, GlaxoSmithKline, Comcast, Pfizer and Samsung."

"If carbon footprint is a major factor in excluding companies from an ESG portfolio, what kinds of companies are favored for investment? In the top holdings for the largest ESG mutual funds, we find Alphabet (Google’s parent) and Facebook, as well as Visa and MasterCard, prominently featured. These companies have had their share of controversies. Would all ESG investors really have their social consciences assuaged by investing in companies found to breach individual privacy or that impose exorbitant interest rates?"

"During particular periods, some funds with specific ESG mandates have outperformed. In the first half of 2020 funds with no oil but high tech stocks did well as the price of oil plummeted and tech stocks soared. But no credible studies show that ESG investing offers consistently higher long-term returns."

"ESG investing is inherently at odds with the goal of earning higher returns."

"It isn’t easy to do well by doing good, and ESG funds may accomplish neither objective."

Princeton’s Confession of Bias

Admission of ‘systemic racism’ could cost the school federal funds

WSJ editorial.

"The folks at Princeton are supposed to be smart. But you have to wonder about the intelligence of inviting federal scrutiny by declaring their own school guilty of racism.

Amid a struggle session with progressive faculty and students this month, Princeton President Christopher Eisgruber published an open letter promising to combat “systemic racism” at the school. That’s an eye-opener since Princeton has assured students and the federal government that it doesn’t discriminate. Has the university been lying?

Enter the Education Department, which wants to know. On Wednesday Assistant Secretary Robert King wrote Mr. Eisgruber requesting records related to his confession of bias. “Among other things,” Mr. King writes, “you said ‘[r]acism and the damage it does to people of color persist at Princeton . . .’ and ‘[r]acist assumptions . . . remain embedded in structures of the University itself.’”

Title VI of the Civil Rights Act of 1964 provides that no one on the basis of race should “be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.” Colleges each year must certify to the Education Department that this is true to receive federal funds.

The department, Mr. King writes, is concerned Princeton’s assurances “may have been false.” He adds: “Its many nondiscrimination and equal opportunity claims to students, parents, and consumers in the market for education certificates may have been false, misleading, and actionable substantial misrepresentations in violation” of federal law.

The department has asked Princeton for a “spreadsheet identifying each person” who may have been subject to discrimination. “The serious, even shocking nature of Princeton’s admissions compel the Department to move with all appropriate speed,” Mr. King writes, warning that colleges found to violate Title VI civil-rights protections could be fined and have to forfeit federal funds.

We don’t support federal agencies investigating political targets, as the Obama Education Department did with for-profit colleges. But Mr. Eisgruber’s public confession made it hard for the Department of Education to ignore. It will be fascinating to watch how Princeton squares its admission of systemic racism with its vow that it doesn’t discriminate."

The Wealth Gap Shrinks: The three years before the pandemic saw big gains for lower earners

WSJ editorial. Excerpts:

"Between 2016 and 2019 . . . Real median incomes grew 9% for Americans who haven’t completed high school and 6.3% for those with only a high-school diploma while declining 2.3% among those with a college degree."

"Net worth (assets minus debt) increased 32.5% among the lowest income quintile and 30.7% among the second lowest,"

"Net worth also increased among blacks (32.1%) and Hispanics (63.6%) compared to whites (4%)."

"One explanation is that lower-income Americans are saving more. The share of families that saved increased to 59% from 55% from 2016 to 2019. Savings took a variety of forms, but Americans in the lower rungs notably invested in stocks and their own businesses."

"Home ownership declined across the socioeconomic spectrum during the Obama Presidency despite near-zero interest rates, but it ticked up 1.4 percentage points overall from 2016 to 2019, including among Hispanics (1.8 points) and blacks (2.3 points)."

Your Covid Cribsheet, Updated

Mysteries remain but one thing is known: We will be living with the virus indefinitely

See By Holman W. Jenkins, Jr. Excerpts:

"Sewage studies and patient samples seem to show the virus was circulating in Europe and South America before an outbreak was officially recognized in Wuhan.

Lockdowns might or might not have been important contributors to suppressing eruptions that overwhelmed hospitals in the Chinese city, in New York, in Northern Italy. These episodes are not well understood."

"Countries that apparently suppressed Covid with strong measures to keep people apart now are experiencing outbreaks once people no longer find it tolerable or acceptable to be kept apart."

"Supersensitive PCR tests may be identifying widely dispersed viral particles in people who were never infected or who long since got over their infections. We don’t know: This may mean more people have been infected and acquired immunity than we realize, or fewer are infected now than we think because of an oversensitive test."

"even some people who died of gunshot wounds, drug overdoses and motorcycle accidents have been categorized as Covid victims in the U.S."

"Now the country is reportedly giving hundreds of thousands of its people an untested vaccine—which is difficult to explain as a research priority or a public-health priority unless the infection is sufficiently present to allow detection of whether the vaccine is actually effective."

Native tribes once set fires to help keep forests in balance. After banning the practice, authorities are returning to it

See Fighting Wildfires With Fire by Richard Schiffman. He is a freelance health and environment journalist based in New York. Excerpts:

"Traditionally, indigenous groups throughout North America and much of the rest of the world set fires to encourage the growth of edibles like berries and tubers and to kill off insect pests. Hunters used fire to drive buffalo herds on the Great Plains, and tribes in the Eastern Woodlands burned vegetation to trigger the sprouting of oak and chestnut trees, which were prized for their nuts.

Human-set fires reduced the tangle of small trees and underbrush that make many forests today tinder boxes waiting to explode. Native American fire culture in California and the Pacific Northwest created a biodiverse mosaic of forests and woodlands interspersed with open meadows that served as natural fire breaks—a far safer landscape than the uniform conifer stands that exist now."

"That relative permissiveness ended with “The Big Blowup” wildfire in 1910 that incinerated 3 million acres, leveling towns in Montana and Idaho. Thereafter, the Forest Service trained crews to put out all fires, a policy championed in the mid-20th century by its mascot, Smokey Bear. We’ve been paying dearly for that mistake for years now, Mr. Tripp argues. [Bill Tripp, the Karuks’ director of natural resources.]

“We don’t think climate change is the cause of these big fires. It is a stressor, a significant stressor,” he said. “But we view fire exclusion as the cause because it allows all of that dead, burnable material to accumulate.”

During the 1960s, scientists began warning presciently that excluding fire from forests was setting the stage for the kind of disastrous blazes that we’re seeing today, and federal programs began to encourage allowing lightning fires to run their course. A spate of big blazes in the 1990s convinced some fire managers to take a more proactive approach, implementing mechanical thinning along with controlled burns to reduce dangerous fuel loads.

The pace and scale of these efforts has lately been accelerating. In 2019 over six million acres were treated by federal agencies with prescribed fires, nearly three times the total of a decade earlier, according to data from the National Interagency Fire Center. Recently, the Forest Service also began partnering with native fire experts like Ron W. Goode, the chairman of California’s North Fork Mono Tribe.

Still, Mr. Tripp says that progress has been far too slow. “The Karuk are given permission to burn about 400 acres a year on private lands,” he said. “We need to be burning at least 4,000 acres a year—and on public lands as well.” He blames bureaucratic hurdles like the difficulty in getting environmental clearance for fires, due to liability issues and a shortage of people properly trained to do the work."

"fire management experts argue that small-scale controlled burns produce far less smoke for shorter durations than the megafires that are darkening skies for weeks throughout the West Coast today.

Can these ancient practices work in the radically different climate and environment that exists today? Mr. Lake, the forest service ecologist, thinks they can. [a U.S. Forest Service research ecologist whose family is of Karuk and Yurok ancestry] He points to Florida, one of a handful of “right to burn” states in the Southeast with strong traditions of rural burning. Landowners there are permitted to set fires on their own property, and forestry agencies also use controlled fire a lot more freely than they do out West.

Florida’s unique fire culture grew out of the contact between early Scottish and Irish settlers, who were already accustomed to burning to manage forage for cattle and wildlife in their homelands, and Native American tribes with a robust tradition of maintaining their landscape of grassy prairies, wetlands and open woodlands with well-timed fires. The tribes schooled Florida’s early settlers on the best times of year to burn based on the natural cycles of plants and the seasonal rising and falling of water on the land.

Unlike in the West, where wildfire frequently spelled disaster, Florida’s history of frequent low-intensity burns was far more benign, creating a more fire-tolerant culture in the state, according to Rick Anderson, the former fire management officer at Everglades National Park. “Florida burns two to three million acres a year to manage its fuels,” Mr. Anderson said. “If California did even a percentage of that, they’d have a lot less catastrophic fire there.”

Another place with a long tradition of safe fire is the wilderness of Arnhem Land in northern Australia, where aboriginal peoples light frequent bush fires, as their ancestors have done since the Pleistocene era, according to David Bowman, a professor of pyrogeography and fire science at the University of Tasmania. Mr. Bowman published an influential study on the subject in 1999 that describes the remarkable survival of what he considers one of the world’s last intact fire cultures."

$1 in taxes costs society more than $1

See Thank These Nobel Laureates for Your Cellphone: Economists Paul Milgrom and Richard Wilson get the prize for devising spectrum auctions by David R. Henderson. Excerpt:

"In its technical paper justifying the awards, the Nobel Committee points out a major problem with using taxes to fund government programs: taxation distorts. The term economists use is “deadweight loss,” a loss that is not offset by a gain to anyone. Economists have estimated that raising $1 in taxes doesn’t cost society only $1; it costs somewhere between $1.17 and $1.56. The extra 17 to 56 cents is deadweight loss. The committee notes that by auctioning off major electromagnetic assets, the federal government avoided having to tax as much."

Biden’s tax plan could create a tax rate of as much 62% for New Yorkers and Californians, studies show

By Robert Frank of CNBC.

• In California, New Jersey and New York City, taxpayers earning more than $400,000 a year could face combined state and local statutory income tax rates of more than 60%.
• Few taxpayers pay the full statutory rates, which don’t include deductions, credits, offsets, loopholes and lower tax rates on other sources of income.
• If the Democrats win the Senate and can pass legislation removing the $10,000 cap on state and local tax deductions, the combined state and local tax rates for top earners could be even lower.

"High earners in New York and California could face combined federal and state tax rates of 62% under Democratic presidential nominee Joe Biden’s tax plan, according to experts.

While Americans earning less than $400,000 would, on average, receive tax cuts under Biden’s plan, the highest earners would face double-digit increases in their official tax rates, according to nonpartisan analyses. In California, New Jersey and New York City, taxpayers earning more than $400,000 a year could face combined state and local statutory income tax rates of more than 60%.

In California, top earners could face a state and federal tax rate of as much as 62.6% under the Biden plan, according to calculations from Jared Walczak of the Tax Foundation. In New Jersey, the combined rates could be just more than 60%, while in New York state they could reach 58.2%. In New York City, home to most of the state’s high earners, the combined city, state and federal income tax rate would be just over 62%.

Of course, few if any taxpayers pay the full statutory rates, which don’t include deductions, credits, offsets, loopholes and lower tax rates on other sources of income. Even though the top U.S. statutory tax rate is currently 37%, the effective rate (what taxpayers actually pay with help from their accountants) for top earners is 26.8%, according to the Tax Foundation. The Biden campaign said what matters to taxpayers and the economy are the effective rates, not the statutory rates.

Under Biden’s plan, the effective tax rate for the top 1% would increase from 26.8% to 39.8%, according to the Tax Policy Center. That means top earners in California and New York City would pay effective state and federal tax rates of around 53% — compared with the roughly 40% they pay in effective rates today.

What’s more, if the Democrats win the Senate and can pass legislation removing the $10,000 cap on state and local tax deductions, the combined state and local tax rates for top earners could be even lower.

Yet the official, combined tax rates of more than 60% for top earners would be the highest in more than 30 years, and well above the rates under the Obama administration. The main drivers of the increase in Biden’s plan are the hike in the top marginal tax rate, to 39.6% from 37%, and the added payroll tax of 12.4% for those making more than $400,000 a year, which is split between the employee and employer. Including other provisions in his plan, the top federal tax rate would be 49.338% under Biden, according to Walczak.

Added to California’s top rate of 13.3%, the combined top marginal income tax rate for top-earning Californians would be 62.64%. In New Jersey, which has a top rate of 10.75% on those making more than $1 million, the top combined rate would be 60.1%. In New York state, the combined rate would be 58.2%, but in New York City, the combined rate would be 62%.

Walczak said if you include the contributions to the tax hikes by employers, which are often passed along to employees, the combined rates would rise even further — to over 65% in California, 62.9% in New Jersey and 64.7% in New York City. They could also jump higher if California and New York raise taxes on high earners, which some legislators have proposed to reduce multibillion-dollar budget gaps.

“These rates would be the highest in about 3½ decades,” said Walzcak, “and imposed on a broader tax base than was in place previously.”"

The invasion of the giant hogweed is one of the many environmental disasters brought on by Soviet centralized planning

See The giant hogweed isn’t just an invasive plant: It’s a metaphor for what is happening to much of this country by Maria Antonova in The NY Times. She is a journalist and science writer. Excerpt:

"The invasion is one of the many environmental disasters brought on by Soviet centralized planning. After World War II, Soviet agronomists, keen to quickly rebuild the country’s agriculture industry, thought that the plant’s impressive biomass could make it a good crop to feed livestock. Seeds were distributed throughout the country.

Hogweed contains a high concentration of furanocoumarins, substances that cause severe burns and blisters when affected areas of skin are exposed to sunlight. Even so, the plant was grown nationwide. By the 1980s, when the plant began infiltrating central Russia’s wilderness, tests showed that cows fed on hogweed produced poor-tasting milk. Efforts to make the plant less toxic failed."

"Russia is the biggest country on Earth and both the state and the people take pride in the size of its territory — “from the southern seas to the polar fringes,” as the current national anthem goes. That quiet emptiness, the enormousness of Russia, has been infiltrated in recent decades by an alien force: the giant hogweed.

This invader, an exceptionally tall plant with a toxic sap that can cause third-degree burns and blindness"

"In the summer, the giant hogweed assumes the look of dill on steroids; its coffee-table sized leaves create thickets impossible to pass without a hazmat suit. In the winter, it desiccates into a brown skeleton. Outside Moscow, the hogweeds are often the only visible landmarks over white fields, ominous umbrellas standing in the snow like War of the Worlds troops poised to march. Officials have begun to refer to overgrown areas as “contaminated.”"

Kamala Harris Gets a Fracking Education

Pence is right: Shale drilling for natural gas has cut C02 emissions

WSJ editorial.

"Kamala Harris in Wednesday’s debate declared that Joe Biden’s Administration would make the U.S. “carbon neutral” by 2035—a more ambitious goal than even California has set—while at the same time disavowing plans to ban fracking for natural gas. We look forward to Mr. Biden explaining this apparent contradiction in the next debate, if there is one.

Meantime, it’s worth highlighting a new Energy Information Administration report that shows how fracking and competitive energy markets have done more to reduce CO2 emissions over the last decade than government regulation and renewable subsidies. Vice President Mike Pence made this point on Wednesday night, and he’s right.

According to the report, energy-related CO2 emissions in the U.S. fell 2.8% last year as many utilities replaced coal and heating oil with less expensive natural gas. Hydraulic fracturing combined with horizontal drilling has unleashed a gusher of natural gas production in the Midwest and Southwest. As a result, natural gas prices have plunged, putting many coal plants out of business.

CO2 emissions from coal declined by more than 50% from 2007 to 2019, the report notes, and by 15% in 2019 alone. Between 2016 and 2019 the share of electricity generated by natural gas rose to 38.1% from 33.7% and by non-carbon generation (including nuclear and hydropower) to 38.2% from 35.5%. Coal generation during this period plunged to 23.3% from 30.3%.

Increasing power generation from natural gas has accounted for 60% of the country’s decline in CO2 emissions from electricity since 2010. The carbon intensity of the country’s energy declined at about the same rate during the first three years of the Trump Presidency as from 2009 to 2016.

The International Energy Agency earlier this year reported that the U.S. “saw the largest decline in energy-related CO2 emissions in 2019 on a country basis” due to a 15% reduction in the use of coal for power generation and “US emissions are now down almost 1 Gt [gigatonne] from their peak in the year 2000, the largest absolute decline by any country over that period.”

To sum up: President Trump pulled out of the Paris Climate Accord and eased the Obama-Biden Administration’s economically destructive climate regulations, and the U.S. is still leading the world in CO2 reductions."

Trump, Covid and Reason

A new statement by scientists explains how to live with the virus

WSJ editorial.

"President Trump’s tweet Monday “Don’t be afraid of Covid” has invited more criticism that he’s again downplaying the virus. Mr. Trump doesn’t do nuance, and he and his team have often acted recklessly, most prominently at the Rose Garden ceremony announcing Judge Amy Coney Barrett’s nomination. But scientists generally agree with his fundamental point that Americans need to learn to live with the virus.

That’s also the message of a new declaration from scientists that the media are ignoring. Organized by Harvard’s Martin Kulldorff, Sunetra Gupta of Oxford and Stanford’s Jay Bhattacharya, the Great Barrington Declaration recommends that people be allowed to live normally while protecting the vulnerable. The authors are infectious-disease experts, and the statement by our deadline had been signed by more than 2,300 medical and health scientists and 2,500 practitioners, and counting.

They describe their approach as “Focused Protection,” but it’s essentially what Sweden has done and even the World Health Organization is now recommending. Many European leaders including French President Emmanuel Macron are also slowly embracing it, though it still remains heresy on America’s left.

The collateral damage from government lockdowns “include lower childhood vaccination rates, worsening cardiovascular disease outcomes, fewer cancer screenings and deteriorating mental health—leading to greater excess mortality in years to come, with the working class and younger members of society carrying the heaviest burden. Keeping students out of school is a grave injustice,” the declaration says. “Keeping these measures in place until a vaccine is available will cause irreparable damage, with the underprivileged disproportionately harmed.”

Reams of public-health data and medical literature agree. The Centers for Disease Control and Prevention estimates that there have been 93,814 non-Covid “excess deaths” this year, including 42,427 from cardiovascular conditions, 10,686 from diabetes and 3,646 from cancer. Many are due to government shutdowns of non-essential medical care.

Public-health surveys also show depression levels, substance abuse and drug overdoses have spiked amid rising unemployment. A quarter of 18- to 24-year-olds in June said they had increased substance use to cope with the pandemic.

Pediatricians have reported a worrying rise in child abuse and accidental injuries from school closures, which have also resulted in stunted learning and emotional growth. A new Stanford study finds that students across 19 states in the spring lost from 57 to 183 days of learning in reading and 136 to 232 days of learning in math.

As the Great Barrington authors explain, “vulnerability to death from COVID-19 is more than a thousand-fold higher in the old and infirm than the young. Indeed, for children, COVID-19 is less dangerous than many other harms, including influenza.” Sixty-seven children under age 15 in the U.S have died from Covid-19.

“Our goal should therefore be to minimize mortality and social harm until we reach herd immunity,” they write. That means protecting the elderly and high-risk individuals—for instance, frequent testing of nursing-home staff—but also reopening schools, colleges, restaurants and businesses with reasonable precautions.

The virus isn’t going away even if Joe Biden wins the election and perhaps not even with a vaccine. Better treatments and protocols have improved outcomes enormously for high-risk individuals—of which Mr. Trump may turn out to be a textbook case.

The shame is that Covid has become so politicized that the calm reasoning of the Great Barrington scientists is drowned out by the fear and loathing of those who want to blame Donald Trump for every new infection. But it is the best advice for how we should cope with Covid."

Google in the Antitrust Dock

Justice will need more proof of consumer harm to win its lawsuit

WSJ editorial.

"The Justice Department on Tuesday rolled out its first major antitrust lawsuit against Big Tech, and target one is Google. The search giant makes a ripe political target, but on the evidence in the lawsuit the government’s claims will be hard to prove.

There’s no denying that Google dominates the U.S. search market, accounting for 90% or so of general queries and 95% on mobile devices, according to the Justice suit. About 40% of U.S. smartphones operate on Google’s Android open-source system, with many apps, including its Chrome browser and search engine, pre-installed. But in antitrust law the most important question is whether this dominance harms consumers.

Justice contends Google violates the Sherman Act by using exclusionary practices to maintain its search dominance. For instance, Google requires smart-phone makers that license its Android system together to pre-install its apps as a bundle including browser and search. Google sweetens the incentive by paying manufacturers and browsers, including competitors like Apple and Mozilla, a share of its ad revenue.

But there’s nothing illegal per se about such bundling or tying agreements or other mutually beneficial contracts between businesses. In 2014 Mozilla struck a deal to make Yahoo its default search engine but switched to Google in 2017 because users preferred it. Microsoft and Yahoo also pay to be featured in Apple’s Safari browser.

The government cites the D.C. Circuit Court of Appeals ruling in U.S. v. Microsoft (2001), which held that Microsoft’s practice of bundling its web operating system and browser violated the Sherman Act. Justice says Google uses similar exclusionary practices to maintain its search monopoly.  

But consumers can easily download other browsers and search engines if they don’t like Google’s, unlike in the 1990s when they had to buy special software or jump through hoops to use an alternative to Microsoft’s. Now most general search engines and web browsers are free. Microsoft’s Bing even pays consumers rewards for using it. Where is the consumer harm? 

According to Justice, “When a consumer uses Google, the consumer provides personal information and attention in exchange for search results. Google then monetizes the consumer’s information and attention by selling ads.” Okay, there’s no “free” search. But consumers consent to letting all sorts of companies, including supermarkets, collect data in return for a free service. Google also allows users to limit the data it collects. Most don’t.

In 2005 Google accounted for about 35% of the general search market compared to 30% for Yahoo and 15% for Microsoft. Both of the latter had plenty of data and capital to invest in building better search products. Microsoft pre-loads every Windows PC with its Edge browser and Bing search. Amazon’s Fire operating system uses Bing as its default. Google doesn’t stop users from switching to other search engines.

One other weakness in the Justice lawsuit is its narrow definition of the search market, which excludes specialized queries for commercial products that drive Google’s ad revenue. Google doesn't profit from selling ads based on searches like “How tall is Donald Trump?” or “temperature in Sacramento.”

Google uses its general search function to hook people, but it makes money from selling ads on specialized queries. This broader advertising market includes Amazon, eBay, as well as websites like Yelp, OpenTable and Expedia. About 60% of Americans start product searches on Amazon.

No doubt Google wields enormous digital and political clout, and not always for the public good. We’ve criticized its censorship of conservative videos on YouTube and its profiting off news content produced by others. There’s a case for antitrust scrutiny. But Justice is going to need more evidence than it has released in this lawsuit to prove that it’s the Standard Oil of the internet."

Suing Google Won’t Help Consumers

Unlike Standard Oil and U.S. Steel, its market share is beneficial to sellers and customers.

By George L. Priest. He is a law professor at Yale.

"The U.S. Justice Department and 11 states filed an antitrust claim against Google Tuesday alleging illegal monopolization. The lawsuit follows the release earlier this month of a voluminous report by the House Judiciary Committee arguing that the four major U.S. internet platforms—Google, Amazon, Apple and Facebook —are monopolies and ought to be broken up. The suit against Google is the first of what will likely be many antitrust attacks on these dominant platforms.

The basic argument of the lawsuit is that Google possesses a monopoly over search engines and search advertising, which it maintains by entering agreements to make its search engine the default on many devices. This resembles one of the claims made 20 years ago against Microsoft’s Internet Explorer. Yet the argument rests on a misconception about the creation and operation of network industries, which will condemn this case—and future ones like it—to failure under sensible interpretations of U.S. antitrust laws.

Initially, the big four platforms didn’t resemble monopolies traditionally prohibited under the antitrust laws. As the Justice Department and House Judiciary Committee admit, they are commercial platforms, built from the growth and development of network benefits, not monopolies created by the merger of former competitors solely to avoid competition and increase prices to consumers. John D. Rockefeller built the Standard Oil monopoly in the 1870s by cartelizing competing oil refineries, first in Cleveland, then across the country, eventually gaining a 90% market share in refining. This cartelization generated some efficiencies as smaller, less efficient refineries were closed down, but its principal effect was to reduce competition among refineries and increase their market power against the railroads.

Similarly, J.P. Morgan and Andrew Carnegie succeeded in the cartelization by merger of previously independent and competing steel manufacturers to form U.S. Steel in 1901. The merger created a monopoly initially constituting two-thirds of steel ingot production. Both the oil-refining and steel monopolies were successively eroded over time by increased competition.

The growth of the internet platforms was entirely different. They have developed internally by offering network benefits—the more people and organizations join, the more useful the network is for everyone. All of us benefit, consumers and sellers, when Google expands its search capabilities. Similarly, all connected to the internet benefit when Amazon expands the range of products it sells and ships. That is how the big four gained large market shares. By contrast, there were no similar network benefits from the aggregation of oil refineries or steel mills by single companies.

While the Justice Department acknowledges the benefits from Google’s possession of scale in the operation of its search engines—according to the Justice Department’s complaint, “scale is of critical importance to competition among general search engines for consumers and search advertisers”—the lawsuit nonetheless attacks Google’s scale and the means it used to acquire it, such as revenue-sharing agreements with rival browsers. This internal contradiction—criticizing Google for achieving a scale that helps consumers and sellers—leaves the Justice Department in an awkward position. That is probably why many other state attorneys general, also hostile to Google and the other platforms, haven’t joined the suit.

The complaint doesn’t demand a coherent remedy. The elimination of Microsoft’s similar restrictive agreements 20 years ago had no effect either on the success of Microsoft at the time or its inability today to compete with Google, but this complaint doesn’t even go there. It asks merely for “structural relief as needed,” as well as attorneys’ fees and costs. The Justice Department doesn’t show, in the slightest, a way to enhance consumer and seller benefit beyond the services provided by Google."

 

 

The Pandemic and Price Gouging in NY City

By Alex Tabarrok.

"The Economist has a good piece on NYC cracking down on corner shops which set prices higher than NYC thinks is just.

The story of your correspondent’s local corner shop offers a cautionary tale.

This type of shop was once familiar in New York, but has largely been squeezed out by chains and bank branches. The owner is an immigrant who opens early and closes late. In crises the shop stocks the products that customers need. When flooding from Hurricane Sandy caused a blackout in 2012, it sold batteries, torches, candles and board games. During the pandemic it has been piled high with boxes of sanitiser, bleach, masks and gloves.

Stocking up comes with risks. Acquiring inventory is costly. Demand drops off when normality returns—unwanted board games linger in the back of the shop. And this time, the rules changed. In March a woman bought a box of masks (each mask costing $2), and then said she was from the city’s office of consumer affairs, and charged the shopkeeper for violating new price-gouging rules. Two days later, says the shopkeeper, another inspector charged the shop again, this time offering guidance on the right prices. Masks should cost no more than $1; gloves selling at $19.95 should sell for only $14.95. Each package marked above the permitted price would be fined $500. There were many packages.

…Shortly before a rescheduled hearing, the shop’s proprietor received an offer to settle the first charge for a little over $7,000. That is much more than his monthly profit, he says from behind the plastic screen now distancing him from customers, looking glumly at a stack of legal papers on his counter. But the fines would be ruinous….The shopkeeper will settle…Justice in the Big Apple has been opaque and costly—and raises the question of who precisely is being gouged.

As Luis Saravia de la Calle said in 1544:

Those who measure the just price by the labor, costs, and risk incurred by the person who deals in the merchandise or produces it, or by the cost of transport or the expense of traveling… or by what he has to pay the factors for their industry, risk, and labor, are greatly in error, and still more so are those who allow a certain profit of a fifth or a tenth. For the just price arises from the abundance or scarcity of goods, merchants, and money… and not from costs, labor, and risk. If we had to consider labor and risk in order to assess the just price, no merchant would ever suffer loss, nor would abundance or scarcity of goods and money enter into the question. Prices are not commonly fixed on the basis of costs. Why should a bale of linen brought overland from Brittany at great expense be worth more than one which is transported cheaply by sea?… Why should a book written out by hand be worth more than one which is printed, when the latter is better though it costs less to produce?… The just price is found not by counting the cost but by the common estimation. (Grice-Hutichinson, 110-111)."

Managing and Mismanaging the Covid Shock

By David Henderson.

"An important lesson from both economic analysis and economic history is that when people are relatively unregulated and free to adjust, they can adjust quickly to various economic shocks, even large ones. But when governments heavily regulate people’s economic activities, these governments slow and often prevent adjustments. The good news is that in 2020, the federal government and many state and local governments have temporarily relaxed regulations to make adjustment easier. The bad news is that many of these same governments have added regulations that make adjustments difficult or impossible. And the further bad news is that many pre-existing regulations have not been loosened and, therefore, act to slow adjustment. One of the most extreme regulations is the Food and Drug Administration’s heavy requirements that limit testing for the Covid-19 disease.

This is from “Managing (and Mismanaging) the “Covid Shock,” my latest article on Defining Ideas, October 22, 2020.

Another excerpt:

However, there’s a responsible solution for restaurants and bars that want to serve drinks: insist that they serve people outside and insist that they require people to stay seated and socially distanced. But governments seem to have problems with letting people have fun. The California Department of Alcoholic Beverage Control insists that bars may open only if they offer “bona fide meals.” Those meals cannot be pre-packaged sandwiches and salads, side dishes like fries and chicken wings, bagged pretzels or popcorn, or, the horror, dessert.

And then one of the worst:

In the midst of a pandemic, one of the things we would like most to know is whether we have the virus. Testing can tell us that. But existing tests are expensive. After recently traveling, I decided, at my wife’s urging, to get tested. I paid $180 for results within twenty-four hours and got them in six hours. I can afford that. But that’s a lot of money for many people, and six hours is still a lot of time. Wouldn’t it be nice if we could have even cheaper tests that we can conduct on ourselves and get fast results? That way, each of us would know whether to isolate or go to work, bars, football games, or restaurants.

Actually, we can, but we may not, because the FDA stops us. These tests cost under $10 and give results within fifteen minutes. But the FDA won’t allow them because they’re not as accurate as tests it does allow."

Why This Disastrous Experiment Also Hurt States that Did Not Lock Down

By John Tamny.

"Imagine 100 people on a wholly deserted island. Life would be pretty dreadful, right? With only 100 people producing, work would be endless in return for very few of life’s comforts.

At which point imagine if suddenly a shipwreck deposited 100 more, able-bodied people on the same deserted, desperate island. Would the first 100 lose their jobs as a consequence of the arrival of the second batch of humans?

The obvious answer is no. In truth, 200 extra “hands” arriving onshore would signal boom times in a relative sense for everyone on the island. The more hands at work, the more that there would be work specialization. And when workers are specialized, they’re logically quite a bit more productive.

Looked at in a country sense, contrary to the view that China’s modern prosperity has been a threat to American workers, the happier truth is that it’s been a blessing. The division of labor is just another term for labor specialization. Just as automation has over time massively increased work productivity and the range of ways that humans could express their workplace talents, so has the entrance of hundreds of millions of humans into the global labor pool boosted productivity, and by extension, economic growth.

On the other hand, if suddenly China were to return to the command and control, collectivist policies that caused mass starvation in the country from the end of the WWII to the late 1970s, readers can rest assured that its exit from productive economic work would have a profoundly negative impact on the U.S. economy. U.S. equities would collapse too.

As Nobel Laureate Robert Mundell has long made plain, the only “closed economy” is the world economy. So much U.S. prosperity is a function of Chinese workers freeing U.S. workers from what they used to do, plus so much of it is a consequence of demand from Chinese workers for U.S. plenty. As is increasingly well known, Apple sells a 1/5^th of its iPhones in China, it’s the second largest market for capitalist symbols Nike and McDonald’s, it’s the second largest box office for Hollywood. If China shuts down or goes communist in the collective sense, the pain will be substantial right here in the U.S.

Conversely, if the U.S. ever moves in a seriously collectivist direction, the subsequent global economic contraction will be brutal. In reality, we’ve seen a snapshot of this over the last several months. Thanks to the imposition of command-and-control policies in the U.S. that were a consequence of the lockdowns, economic growth plummeted in countries reliant on U.S. prosperity. Think Bangladesh, think El Salvador, think the Philippines. Even if all three countries had remained fully free amid global hysteria related to the virus, each would have been crushed by the economic errors made stateside.

Which brings us to Iowa. It was one of the states that didn’t lock down in response to the coronavirus. New York Times reporters Ben Casselman and Jim Tankersley have alerted their flock to a growth slowdown in the state despite. Supposedly Iowa’s economic struggles are a sign that lockdown opponents have overstated the impact of the latter on economic growth. No, they haven’t.

While it’s surely true that some businesses in Iowa chose (as Casselman and Tankersley make plain) to stay closed or to operate in limited capacity on their own, by their own admission the lack of lockdowns hasn’t been the same as a lack of rules. Though there weren’t lockdowns, there were and are restrictions that limit economic activity.

More important, it cannot be stressed enough that Iowa’s economy would have declined even if the state’s legislators hadn’t imposed any limits at all. To see why this is true, just re-read the opening paragraphs of this write-up.

Iowa isn’t just an economic portion of a U.S. whole, so it’s only natural that its economy would suffer the lockdown errors made in other states. Per Times reporter Patricia Cohen back in May, over 40 million American workers had filed for unemployment. Since Iowa is one of the U.S.’s “breadbaskets,” logic dictates that economic contraction elsewhere in the U.S. would harm Iowa much as contraction in China would harm the U.S. economy.

And then the loss of 40 million jobs would signal at least for a time, the exit of 80 million “hands” from the U.S. workforce. This is important when it’s remembered that even something as basic as the pencil is a consequence of global cooperation. Fewer workers means reduced productivity for workers overall because it means reduced labor division.

All of this in mind, the better way to address Iowa’s slow growth is to consider the unseen. How much more shrunken would the state’s economy be if the state had locked down in the way that California or New York had? That’s the more important measure.

In Cassleman and Tankersley’s case, their reporting on an economic slowdown in Iowa had a redundant quality. Naturally Iowa’s economy has contracted when it’s remembered that by April, a quarter of the U.S. economy was locked down, along with parts of the global economy. Slower growth was a given. One state or one country’s impoverishment doesn’t lift other states or countries; rather it impoverishes them in a relative sense.

That’s is so because wealth isn’t a fixed pie. Instead, wealth is created. And the more that labor is divided, the more economic growth overall.

In short, Casselman and Tankersley mis-spoke or mis-wrote. The lockdowns crushed the U.S. economy. Period. That they also infected the part of the U.S. and world not locked down was and is a statement of the obvious. The only “closed U.S. economy” is the U.S. economy."

Does Serum Vitamin D Level Affect COVID-19 Infection and Its Severity?-A Case-Control Study

By Kun Ye , Fen Tang , Xin Liao , Benjamin A. Shaw , Meiqiu Deng , Guangyi Huang , Zhiqiang Qin , Xiaomei Peng , Hewei Xiao , Chunxia Chen , Xiaochun Liu , Leping Ning , Bangqin Wang ORCID Icon, Ningning Tang , Min Li , Fan Xu , Shao Lin & Jianrong Yang. From Journal of the American College of Nutrition.

"Abstract

Background

As effective medication to treat COVID-19 is currently unavailable, preventive remedies may be particularly important.

Objective

To examine the relationship between serum 25-hydroxy vitamin D (25(OH)D) level and COVID-19 infection, its severity, and its clinical case characteristics.

Methods

This case-control study compared serum 25(OH)D levels and rates of vitamin D deficiency (VDD) between 80 healthy controls and 62 patients diagnosed with COVID-19 and admitted to Guangxi People’s Hospital, China, 2/16/2020–3/16/2020. Cases were categorized into asymptomatic, mild/moderate, and severe/critical disease. Logistic regression analysis was conducted to examine the associations between 25(OH)D level, or VDD, and case status/severity of COVID-19 while controlling for demographics and comorbidities. A threshold level of vitamin D for conveying COVID-19 risk was estimated.

Results

Severe/critical COVID-19 cases were significantly older and had higher percentages of comorbidity (renal failure) compared to mild cases. The serum 25(OH)D concentration in COVID-19 patient was much lower than that in healthy control. And 25(OH)D level was the lowest in severe/critical cases, compared with mild cases. In further, significantly higher rates of VDD were found in COVID-19 cases (41.9%) compared to healthy controls (11.1%). And VDD was the greatest in severe/critical cases (80%), compared with mild cases (36%). These statistically significant associations remained even after controlling for demographics and comorbidities. A potential threshold of 25(OH)D (41.19 nmol/L) to protect against COVID-19 was identified.

Conclusion

Elderly and people with comorbidities were susceptible to severe COVID-19 infection. VDD was a risk factor for COVID-19, especially for severe/critical cases. While further confirmation is needed, vitamin D supplementation may have prevention or treatment potential for COVID-19 disease."

Our COVID-19 Plan would Minimize Mortality and Lockdown-induced Collateral Damage, authors of the Great Barrington Declaration

By Jayanta Bhattacharya, Sunetra Gupta and Martin Kulldorff.

"Current COVID-19 lockdowns protect low-risk college students and young professional bankers, attorneys, journalists, scientists and others who can work from home, while older high-risk working-class people are risking their lives building the population immunity that will eventually protect us all.

While mortality is inevitable during a pandemic, the COVID-19 lockdown strategy has led to more than 220,000 deaths, with the urban working class carrying the heaviest burden. Many older workers have been forced to accept high mortality risk or increased poverty, or both. While the current lockdowns are less strict than in March, the lockdown and contact tracing strategy is the worst assault on the working class since segregation and the Vietnam War.

Lockdown policies have closed schools, businesses and churches, while not enforcing strict protocols to protect high-risk nursing home residents. University closures and the economic displacement caused by lockdowns have led millions of young adults to live with older parents, increasing regular close interactions across generations.

The “Focused Protection” plan in the Great Barrington Declaration would minimize both COVID-19 mortality and lockdown-induced collateral damage on other health outcomes. In line with pre-2020 pandemic preparedness plans, the declaration calls for better protecting the old and other high-risk groups, for whom COVID-19 is more dangerous than influenza.

By contrast, for children, COVID-19 is less dangerous than influenza. Children and low-risk young adults should be allowed to live near normal lives as they face greater medical, psychological and economic harms from lockdowns than from COVID-19. Immunity among low-risk young adults could also shorten the length of the pandemic, making it easier for older people to protect themselves.

Denying in-person teaching to students is harmful to their education and physical and mental health, with working-class children hardest hit. Online schooling puts a disproportional burden on our children, despite their own minimal risk.

For ages 1 to 15, Sweden kept day care and schools open throughout the height of the pandemic, and among the 1.8 million children of that age, there were zero COVID-19 deaths without masks used or physical distancing. Neither was there any excess risk for in-person teachers compared with the average of other professions.

Some argue that it is impossible to separate older and younger generations. While 100% separation is impossible, lockdowns have “successfully” shifted infection risk from the professional class to the working class and nursing home residents.

It is no more challenging to shift infection risk from high-mortality-risk older people to low-mortality-risk younger adults, including the young bankers, attorneys, journalists and scientists who are now protected."

Italy Did Everything Right to Stop a Second Wave of the Coronavirus. So What Went Wrong?

Just one month ago, Italy was the shining example of how masks and aggressive testing work to stave off a second COVID wave. Why have things gone so terribly wrong?

By Barbie Latza Nadeau The Daily Beast.

"If you turn on the news in Italy right now, you might be forgiven for thinking you are getting reruns from March. Pictures of COVID-only units, field hospitals being erected, exhausted medics, and coffins are again dominating headlines as Italy comes to grips with a deadly second wave of COVID-19. On Wednesday, the death toll topped 125 in a 24-hour period for the first time since May when this country was still under a draconian lockdown and seen as a harbinger of what was to come.

What's particularly troubling about the return of COVID in Italy is that the country has done everything experts like Dr. Anthony Fauci have been advising. Face masks in public places have been compulsory for months, social distancing is strongly enforced, nightclubs have never reopened, and sporting arenas are at less than a third of capacity. Children who are back at school are regularly tested and strictly social-distanced, and yet, the second wave seems completely unstoppable. 

While ruling out another full lockdown, Italian health officials are instead urging people to limit their own movements, even as concern grows that by keeping them at their homes, they are inadvertently encouraging private parties where the spread seems to be the worst at the moment. Italy’s health ministry released data this week showing that 80.3 percent of the new infections “occur at home” while only 4.2 percent come from recreational activities and schools.

On Wednesday, Italy logged 15,199 new infections—nearly three times as many as the worst day of the pandemic last March and a per capita rate that would be the equivalent of 90,000 new cases in a single day in the U.S., a level that has not yet been reached.

And it is only getting worse. “Certain metropolitan areas like Milan, Naples, and Rome are already out of control in terms of containing the pandemic,” Walter Ricciardi, an infectious-diseases specialist who advises the Italian government and holds the same position in Italy as Fauci does in the U.S., said at a conference Wednesday. “Their numbers are too high to be contained by the traditional method of tracing and testing. And as previous epidemics teach us, when you can’t contain you have to mitigate, namely you have to block movement.”

To some degree, the increase in cases is also tied to Italy’s aggressive testing scheme, which has paved the way for easy, fast diagnostics at all airports and in private clinics in addition to state-run drive-in facilities. Private technicians also make house calls for around $75 to conduct tests in the privacy of homes, which has also contributed to the higher number of cases. On Wednesday, nearly 180,000 tests were reported, which is a record here for a 24-hour period.

But authorities are very concerned still that despite all the best efforts to contain the spread, it simply cannot be stopped. The government’s experts insist that the rate of contagion among schoolchildren is not the driving factor; but young people who feel confident they won’t get very sick and insist on gathering socially may be. Now major cities like Milan, Rome, and Naples have evening curfews to try to stop young people from gathering socially, which seems to be contributing to the spread. Ricciardi said most of the contagion that happens within multigenerational homes comes from young people bringing it in.

Italy is by no means alone in its battle against the European second wave of the pandemic. France, Spain, and the Czech Republic have all broken records in new cases and introduced measures to mitigate the spread. The United Kingdom also has record numbers of new infections in a single day, and Ireland has completely locked down.

 

Germany—which largely avoided major problems during the first European wave—has reported shocking numbers of new infections, which topped 10,000 in a single day Wednesday. Authorities there have also blamed young people going out or groups meeting privately for the spread. Lothar Wieler, president of its disease-control center, told the DW network that people going to work is not the problem. “We don’t see so many outbreaks at workplaces or in public transportation, but it’s mostly coming together in privacy, in parties, and also in services and weddings,” he said. “We shouldn’t have too many of these events.”

On Wednesday, a very concerned Italian Prime Minister Giuseppe Conte addressed the Italian Senate, assuring them that there will not be a repeat of the full lockdown, which crippled the economy and all but destroyed the tourism sector. While urging ordinary citizens to limit unnecessary travel, he stopped short of mandating any limits to movement—for now. “We can’t use the same strategy to fight the second wave as we did in spring,” he said. “Now we’re in a different situation than we were in March—back then we didn’t have the means to diagnose. Now we are more prepared thanks to the hard work and sacrifices of all.”

But for many, the sacrifices that helped during the first round seem lost now, as though they had been made in vain."

California Is Number One In The Supplemental Poverty Measure

See Suppose you live in America’s most liberal state. Now suppose you live in the state known as the “poverty capital of America.” But I repeat myself by Mark Perry.

  

"The table above is based on Census Data released last month and displays US states ranked by two different measures of poverty: a) the traditional, official measure of poverty and b) the Census Bureau’s recently introduced (2011) Supplemental Poverty Measure (SPM), which accounts for each state’s cost-of-living including housing, energy costs and medical costs, and taxes. The SPM also considers non-cash government assistance as a form of income and is therefore considered a more accurate measure of poverty than the traditional, official rate. For the country as a whole, the percent of Americans in poverty using the SPM of 12.5% for the years 2017-2019 (averaged) is 1.0 percentage point higher than the percentage of Americans living in poverty (11.5%) using the official poverty measure.

On an individual state basis, the biggest changes in a state’s poverty rate between the two measures in each direction are: a) California’s official poverty rate of 11.4% ranked it No. 21 but the Golden State moved up to No. 1 at 17.2% (highest state poverty rate in the US) using the SPM (a difference of +5.8%) and b) Mississippi’s poverty rate ranked it No. 1 (tied with Louisiana) at 19.1% using the official measure but No. 5 at 15.2% using the SPM (a difference of -3.9%). Overall, 21 states including California (and the District of Columbia) showed a greater percentage of people in poverty using the SPM, 28 states, including Mississippi, showed a lower percentage of people in poverty and Georgia showed no change at 13.3% for both measures.

One of the biggest reasons for the increase in California’s (and 21 other states) poverty rate using the SPM is because of the state’s high cost-of-living including sky-high housing costs (median home price of $586,659) and because of high taxes and energy costs. And the decrease in Mississippi’s SPM poverty rate (and 27 other states) is because of that state’s low cost-of-living, including low housing costs (median home price of $131,774). Energy costs are another factor that impacts a state’s SPM. For example, California’s average electricity price of 18.59 cents per kilowatt-hour is 86% higher than the national average of 11.06 cents, while electricity in Mississippi at 9.44 cents per kilowatt-hour is 15% below the national average.

A 2018 article in the Manhattan Institute’s City Journal by Kerry Jackson (Pacific Research Institute fellow in California studies) — “California, Poverty Capital” — uses the SPM measure of poverty to address the question “Why are so many people poor in the Golden State?” Here are some excerpts:

California—not Mississippi, New Mexico, or West Virginia—has the highest poverty rate in the United States. According to the Census Bureau’s Supplemental Poverty Measure—which accounts for the cost of housing, food, utilities, and clothing, and which includes noncash government assistance as a form of income—nearly one out of four Californians is poor. Given robust job growth in the state and the prosperity generated by several industries, especially the supercharged tech sector, the question arises as to why California has so many poor people, especially when the state’s per-capita GDP increased roughly twice as much as the U.S. average over the five years ending in 2016 (12.5 percent, compared with 6.27 percent).

It’s not as if California policymakers have neglected to wage war on poverty. Sacramento and local governments have spent massive amounts in the cause, for decades now. Myriad state and municipal benefit programs overlap with one another; in some cases, individuals with incomes 200 percent above the poverty line receive benefits, according to the California Policy Center. California state and local governments spent nearly $958 billion from 1992 through 2015 on public welfare programs, including cash-assistance payments, vendor payments, and “other public welfare,” according to the U.S. Census Bureau. Unfortunately, California, with 12 percent of the American population, is home today to roughly one in three of the nation’s welfare recipients. The generous spending, then, has not only failed to decrease poverty; it actually seems to have made it worse.

Jackson identifies several specific factors that collectively contribute to making California the “poverty capital of America.”

1. Welfare State Bureaucracy and Lack of Pro-Work Welfare Reform. The state and local bureaucracies that implement California’s antipoverty programs have resisted pro-work reforms. In fact, California recipients of state aid receive a disproportionately large share of it in no-strings-attached cash disbursements. It’s as if welfare reform passed California by, leaving a dependency trap in place. Immigrants are falling into it: 55 percent of immigrant families in the state get some kind of means-tested benefits, compared with just 30 percent of natives.

Self-interest in the social-services community may be at work here. If California’s poverty rate should ever be substantially reduced by getting the typical welfare client back into the workforce, many bureaucrats could lose their jobs. As economist William A. Niskanen explained back in 1971, public agencies seek to maximize their budgets, through which they acquire increased power, status, comfort, and job security. In order to keep growing its budget, and hence its power, a welfare bureaucracy has an incentive to expand its “customer” base—to ensure that the welfare rolls remain full and, ideally, growing. With 883,000 full-time-equivalent state and local employees in 2014, California has an enormous bureaucracy—a unionized, public-sector workforce that exercises tremendous power through voting and lobbying. Many work in social services.

2. High Housing Costs. Further contributing to the poverty problem is California’s housing crisis. Californians spent more than one-third of their incomes on housing in 2014, the third-highest rate in the country. A shortage of housing has driven prices ever higher, far above income increases. And that shortage is a direct outgrowth of misguided policies. “Counties and local governments have imposed restrictive land-use regulations that drove up the price of land and dwellings,” explains analyst Wendell Cox. “Middle income households have been forced to accept lower standards of living while the less fortunate have been driven into poverty by the high cost of housing.” The California Environmental Quality Act (CEQA), passed in 1971, is one example; it can add $1 million to the cost of completing a housing development. CEQA costs have been known to shut down entire home-building projects. CEQA reform would help increase housing supply, but there’s no real movement to change the law.

3. High Energy Costs. Extensive environmental regulations aimed at reducing carbon-dioxide emissions make energy more expensive, also hurting the poor. By some estimates, California energy costs are as much as 50 percent higher than the national average [electricity costs are now nearly double the national average, see above]. In 2012, nearly 1 million California households faced ‘energy poverty’—defined as energy expenditures exceeding 10 percent of household income. In certain California counties, the rate of energy poverty was as high as 15 percent of all households and the rate could exceed 17 percent of median income in some areas.

4. $15 an Hour Minimum Wage. Looking to help poor and low-income residents, California lawmakers recently passed a measure raising the minimum wage from $10 an hour to $15 an hour by 2022 [it’s now $13 an hour, the second-highest state minimum wage in the US] —but a higher minimum wage will do nothing for the 60 percent of Californians who live in poverty and don’t have jobs, and studies suggest that it will likely cause many who do have jobs to lose them. A Harvard study found evidence that “higher minimum wages increase overall exit rates for restaurants” in the Bay Area, where more than a dozen cities and counties, including San Francisco, have changed their minimum-wage ordinances in the last five years. “Estimates suggest that a one-dollar increase in the minimum wage leads to a 14 percent increase in the likelihood of exit for a 3.5-star restaurant (which is the median rating),” the report says. These restaurants are a significant source of employment for low-skilled and entry-level workers.

Finally, here is Jackson’s pessimistic conclusion:

California’s de facto status as a one-party state lies at the heart of its poverty problem. With a permanent majority in the state senate and the assembly, a prolonged dominance in the executive branch, and a weak opposition, California Democrats have long been free to indulge blue-state ideology while paying little or no political price. The state’s poverty problem is unlikely to improve while policymakers remain unwilling to unleash the engines of economic prosperity that drove California to its golden years.

Related: California ranked last year as America’s No. 2 Outbound State (second only to Illinois) based on household moves (65% outbound vs. 35% inbound) according to North American Van Lines’ 2019 US Migration Report. It is also noteworthy that 2017 was the first year that California (at 60% outbound) ever ranked in this national study’s Top Five outbound US states. And the table below shows from a balanced 50% inbound – 50% outbound in 2011 and 2012, the outmigration from California has been increasing to the point that last year there were almost two outbound moves from California for every one inbound move. The acceleration of people moving out of California is likely a direct result of the Golden State’s new status as the “poverty capital of America.”