Why The Occupiers Chose Zuccotti Park

See Occupy Wall Street's Crony Capitalism: Political extortion created Zuccotti Park, and it allows protesters to remain despite the noise, filth and stink by L. Gordon Crovitz, WSJ, 10-17-11. Excerpts:

"How did protesters manage to take over Zuccotti Park, a half-acre plot a few blocks from Wall Street? It turns out that this land grab is not due to the power of social media. Instead, the main force letting protesters stay in the park is old-fashioned crony capitalism."

" Zuccotti is not a city park, where sleeping overnight is prohibited. Instead, it is one of some 500 "privately owned public spaces" that New York City officials created as part of zoning deals with real estate developers.

In the case of Zuccotti Park, the crony capitalism goes back to the 1970s, when U.S. Steel built the One Liberty Plaza office tower. In exchange for adding nine stories, city officials extracted an agreement that U.S. Steel would fund a 24-hour-a-day park across the street.

These quasipublic spaces are notorious for leaving unclear who's responsible for what."

"Even if this were a public park, Supreme Court cases on the "time, place and manner" for demonstrations would clearly allow officials to stop a month-long sleepover.

Occupy Wall Street leadership and lawyers picked Zuccotti Park knowing the split responsibility for privately owned public spaces would give them a better chance to stay than in a public park. The absence of quasipublic parks explains why similar Occupy efforts failed in Washington, Chicago and Trenton, N.J., where police quickly removed protesters camping out in parks."

"Last week, Brookfield finally asked the New York police commissioner for help. "The manner in which the protesters are occupying the park violates the law, violates the rules of the park, deprives the community of its rights of quiet enjoyment to the park, and creates health and public safety issues that need to be addressed immediately," its letter to the police reads."

""Brookfield got lots of calls from many elected officials threatening them and saying, 'If you don't stop this, we'll make your life more difficult,'" Mayor Bloomberg said on his radio show on Friday."

In 2008, nearly 5,000 people died waiting for a kidney

See Why Legalizing Organ Sales Would Help to Save Lives, End Violence by Anthony Gregory, a research editor at the Independent Institute. From the Atlantic Monthly.

"In the United States, where the 1984 National Organ Transplantation Act prohibits compensation for organ donating, there are only about 20,000 kidneys every year for the approximately 80,000 patients on the waiting list. In 2008, nearly 5,000 died waiting.

A global perspective shows how big the problem is. "Millions of people suffer from kidney disease, but in 2007 there were just 64,606 kidney-transplant operations in the entire world," according to George Mason University professor and Independent Institute research director Alexander Tabarrok, writing in the Wall Street Journal.

Almost every other country has prohibitions like America's. In Iran, however, selling one's kidney for profit is legal. There are no patients anguishing on the waiting list. The Iranians have solved their kidney shortage by legalizing sales.

Many will protest that an organ market will lead to exploitation and unfair advantages for the rich and powerful. But these are the characteristics of the current illicit organ trade. Moreover, as with drug prohibition today and alcohol prohibition in the 1920s, pushing a market underground is the way to make it rife with violence and criminality.

In Japan, for the right price, you can buy livers and kidneys harvested from executed Chinese prisoners. Three years ago in India, police broke up an organ ring that had taken as many as 500 kidneys from poor laborers. The World Health Organization estimates that the black market accounts for 20 percent of kidney transplants worldwide. Everywhere from Latin America to the former Soviet Republics, from the Philippines to South Africa, a huge network has emerged typified by threats, coercion, intimidation, extortion, and shoddy surgeries."

"Several years ago, transplant surgeon Nadley Hakim at St. Mary's Hospital in London pointed out that "this trade is going on anyway, why not have a controlled trade where if someone wants to donate a kidney for a particular price, that would be acceptable? If it is done safely, the donor will not suffer.""

The middle class and the poor have gained over the past three decades

See Let's get real about poverty in America by Walter Williams. Excerpts:

""The Material Well-Being of the Poor and the Middle Class Since 1980" is a research paper by professor Bruce D. Meyer of the University of Chicago and the National Bureau of Economic Research and professor James X. Sullivan of the University of Notre Dame.

In it, they report: "Our results show evidence of considerable improvement in material well-being for both the middle class and the poor over the past three decades. Median income and consumption both rose by more than 50 percent in real terms between 1980 and 2009.

"In addition, the middle 20 percent of the income distribution experienced noticeable improvements in housing characteristics: living units became bigger and much more likely to have air conditioning and other features.

"The quality of the cars these families own also improved considerably. Similarly, we find strong evidence of improvement in the material well-being of poor families.""

"Income measures fail to capture important components of economic well-being, such as wealth and the ownership of durables, e.g., houses and cars. For example, official measures would consider a retired couple who owned their car and mortgage-free $700,000 home and lived on $20,000 savings to be poor. Clearly, their income does not reflect their material well-being.

"Income Mobility in the U.S. from 1996 to 2005" is a report by the U.S. Department of the Treasury that shows considerable income mobility of individuals in the U.S. economy.

"Roughly half of taxpayers who began in the bottom income quintile in 1996 moved up to a higher income group by 2005. Among those with the very highest incomes in 1996 -- the top 1/100 of 1 percent -- only 25 percent remained in this group in 2005. Moreover, the median real income of these top taxpayers declined over the study period."

These findings confirm previous studies dating back to the 1960s reaching the same conclusion, namely: At different periods of time, different people occupy different income groups, but the overall trend is upward.

What about the concentration of wealth? In 1918, John D. Rockefeller's fortune accounted for more than half of 1 percent of total private wealth. To compile the same half of 1 percent of the total private wealth in the United States today, you'd have to combine the fortunes of Microsoft's Bill Gates ($59 billion) and New York Mayor Michael Bloomberg ($19 billion), but with 10 other multibillionaires in between."

U.S. Sugar Program Hurts Businesses and Kills Jobs

Great post by Daniel Rivera Greenwood of the Competitive Enterprise Institute Blog.

"CBS San Antonio affiliate KENS 5 reports that a San Antonio candy company, Judson-Atkinson Candy Company, has ceased operations after 110 years of making candy. The company has been forced to lay off more than 100 employees, and currently has only 14 people in its production facility. The family-run business says that the company simply can’t compete with firms outside the U.S., since domestic companies pay more for candies’ main ingredient: sugar. According to the owner of the company, Amy Atkinson Voltz, the candy company pays more than twice the international price for sugar, which caused an additional $2 million in costs for the company. “It’s totally unfair competition,” Atkinson said. “It’s been really hard. We had to bring in employees who had worked here 20-plus years and tell them that we were not going to produce candy right now.”

With the costly and unnecessary U.S. sugar program, it’s no surprise that American candy and beverage manufacturers have a hard time competing against international products from countries like Brazil and Mexico. While some domestic manufacturers are able to switch to alternative products like high fructose corn syrup, its application is limited in the candy manufacturing and baking industries.

The U.S. sugar program, part of the 2008 Farm Bill, is a policy that protects sugar producers at consumers’ and manufacturers’ expense. At the same time the program increases sugar expenditures by American consumers and manufacturers by about $2.4 billion, it adds $1.4 billion in extra income for sugar producers.

The costs go beyond businesses’ and consumers’ pockets. A U.S. Department of Commerce report found that from 1997 to 2009, more than 112,000 jobs were eliminated in the sugar containing industries. Supporters of the program claim that artificially inflating sugar prices supports jobs in the sugar producing sector. But, according to the same report, for every job in that sector, approximately three jobs are lost in the sugar containing industries. Unsurprisingly, there are around 600,000 sugar using jobs in the United States, as opposed to only 20,000 jobs in the sugar producing sector. Artificially propping up a few jobs with few beneficiaries at a larger group’s expense is inefficient and inexcusable.

In a time of high unemployment (9.1 percent in August), politicians should move to eliminate programs that increase the federal budget deficit and eliminate jobs. Companies like Judson-Atkinson, and larger ones like Hershey, are forced to close facilities or move them to other countries as a result of expensive sugar in the United States. And while labor cost differences are real and play a role in companies’ bottom line, artificially expensive inputs do not help United States’ competitiveness."

"The 99%" of Us Get Fined and Go to Jail for Insider Trading, But the Exempt "Political 1%" Can Get Rich

Great post by Mark Perry of "Carpe Diem."

"(CBS News) -- "Martha Stewart went to jail for it. Hedge fund honcho Raj Rajaratnam was fined $92 million and will go to jail for years for it. But members of Congress can do the same thing -use non-public information to make stock trades -- and there's no law against it. Steve Kroft on "60 Minutes" reports on how America's lawmakers can legally make tidy profits on information only they know, simply because they won't pass a law against themselves. The report will be broadcast on Sunday, Nov. 13 at 7 p.m. (watch preview above).

If senators and representatives are using non-public information to win in the market, it's all legal says Peter Schweizer, who works for the Hoover Institute, a conservative think tank. He has been examining these issues for some time and has written about them in a book, "Throw them All Out." "Insider trading laws apply to corporate executives, to Americans...If you are a member of Congress, those laws are deemed not to apply," he tells Kroft. "It's really the way the rules have been defined... lawmakers have conveniently written them in such a way as they don't apply to themselves," says Schweizer.

Efforts to make such insider trading off limits to Washington's lawmakers have never been able to get traction."



MP: Maybe the OWS protests should direct some outrage at the greed of the political class "who get rich off insider stock tips, land deals and cronyism that would send the rest of us to prison" (from the front cover of Peter Schweizer's book)?



Update 1: A 2011 research article in the journal Business and Politics ("Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives") found that the stock portfolios of House of Representative members outperformed the overall stock market by 55 basis points per month, or 6.6% on an annual basis between 1985 and 2001, suggesting that lawmakers have a "substantial informational advantage" over the general public and even over corporate insiders.



Update 2: The chart below illustrates how an additional return of 6.6% per year for House Members would have affected an investment in the stock market between 1985 and 2001. A $1,000 investment in the S&P500 at the beginning of 1985 would have grown to $6,043 by the end of 2001, earning an annual return of 11.16%. In contrast, adding a 6.6% premium for lawmakers due to their informational advantage would have generated an annual return of 17.76%, and a $1,000 investment in 1985 would have grown to $16,172, or roughly 2.7 times as much as an investment in the S&P500. Not bad. Insider trading has its advantages."

The Long, Undistinguished, and Very Costly Graveyard of Failed Government Energy Projects

Great post by Mark Perry of "Carpe Diem."

"From an article in yesterday's Washington Post by energy writer Steven Mufson "Before Solyndra, A Long History of Failed Government Energy Projects":

"Solyndra, the solar-panel maker that received more than half a billion dollars in federal loans from the Obama administration only to go bankrupt this fall, isn’t the first dud for U.S. government officials trying to play venture capitalist in the energy industry. The Clinch River Breeder Reactor. The Synthetic Fuels Corporation. The hydrogen car. Clean coal. These are but a few examples spanning several decades — a graveyard of costly and failed projects.

Not a single one of these much-ballyhooed initiatives is producing or saving a drop or a watt or a whiff of energy, but they have managed to burn through far more more taxpayer money than the ill-fated Solyndra. An Energy Department report in 2008 estimated that the federal government had spent $172 billion since 1961 on basic research and the development of advanced energy technologies."

Conclusion: "Perhaps the federal government is, as former Obama economic adviser Lawrence Summers put it, “a crappy VC,” or venture capitalist. Or perhaps it should stick to funding basic research. But if more recipients of Energy Department loan guarantees falter, they will become part of a long, if undistinguished, history of failure.""

There may be nothing wrong with social mobility in the U.S.

See Confirmation Bias, Perhaps? by Don Boudreaux of "Cafe Hayek."

"Here’s a letter to the Washington Post:

Fareed Zakaria writes that “The most comprehensive comparative study, done last year by the Organization for Economic Cooperation and Development, found that ‘upward mobility from the bottom’ … was significantly lower in the United States than in most major European countries, including Germany, Sweden, the Netherlands and Denmark” (“The downward path of upward mobility,” Nov. 10).

Not so.

Here are this OECD-study’s three bullet points summarizing findings on economic mobility directly (rather than findings on the connection between family background and educational achievement). Does the U.S. stand out from “major European countries”?

“* Parental or socio-economic background influences descendants’ educational, earnings and wage outcomes in practically all countries for which evidence is available.

“* Mobility in earnings across pairs of fathers and sons is particularly low in France, Italy, the United Kingdom and the United States, while mobility is higher in the Nordic countries, Australia and Canada.

“* Across European OECD countries, there is a substantial wage premium associated with growing up in a better-educated family, and a corresponding penalty with growing up in a less-educated family. The premium and penalty are particularly large in southern European countries, as well as in the United Kingdom. The penalty is also high in Luxembourg and Ireland. In these countries the wage premium is more than 20%, while the penalty is some 16% or more (relative to wages earned by individuals raised in a family with average education).”

As for this study’s other measures of social mobility (which examine family-background’s influence on students’ educational achievements), on these, too, U.S. mobility simply does not stand out as being significantly or consistently lower than in other – including major European – countries.

Sincerely,
Donald J. Boudreaux"

And this exchange in the comments was good:

Euro-JoeDoe November 10, 2011 at 4:44 pm

Is it easier to move upward in social ladders here in Europe? The answer is yes! But it’s not because we have some how better system. It’s only because gaps between social classes are much smaller here than in US.

Reply
. Don Boudreaux November 10, 2011 at 4:48 pm

Yes. This point is important – and, coincidentally, one that I made earlier today at a talk I delivered at Duke’s law school.