Category: Business and Society

Duke University is embroiled in a sensational scandal involving its lacrosse team and allegations of sexual assault of a stripper at a wild party. But, as Anthony Bradley points out, the case is really symptomatic of a much larger problem in American society. “Why is there no national outrage about the fact that two adult women subjected themselves to voyeuristic, live pornography?” he asks. “What kind of men do we raise in America that they would even want to hire a stripper?”

Read the full commentary here.

Blog author: jspalink
Thursday, April 13, 2006
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When I was in college, living in the dorms, friends of mine would play a game called bigger and better. In this game, they would take an object–something that they owned–and trade it up for something that was worth a bit more to them, but worth a bit less to the person that they were trading with.

This is a perfect example of a market economy. You have something that you can trade, somebody else has something that they can trade, and both parties are better off for the transaction. My friends could go out with a pen and come home with a couch for the dorm. Don’t get me wrong, they weren’t always this successful. It usually involved a little bit of time, but it made for a fun Saturday afternoon.

Then I found this website, a blog, where a man documents his game of bigger-and-better. He started out with a little red paper-clip. Right now he’s looking to trade one year in Phoenix (which includes one year free rent in the heart of downtown Phoenix. [If needed, the apartment can also come fully furnished] and roundtrip airfare for two from any major airport in North America) for something bigger-and-better. His goal is to own a house at the end of his game.

A small example of how having something of little value to yourself doesn’t mean that you can’t leverage what you have on the market to find something of greater value to yourself.

An op-ed earlier this week in the New York Times examines the emphasis and attention that has been placed on the influx of low-wage immigrants to the United States. According to Steven Clemons and Michael Lind, “Congress seems to believe that while the United States must be protected from an invasion of educated, bright and ambitious foreign college students, scientists, engineers and entrepreneurs, we can never have too many low-wage fruit-pickers and dishwashers.”

They base this conclusion on many of the measures and stipulations that have been put forth in the varieties of proposals, bills, and amendments flowing out of the latest discussions over immigration reform. “While the United States perversely tries to corner the market in uneducated hotel maids and tomato harvesters, other industrial democracies are reshaping their immigration policies to invite the skilled immigrants that we turn away,” they write.

The answer, say Clemons and Lind, is to model US immigration policy on the successful examples of other countries, that see highly-educated and motivated immigrants as a boon rather than a curse. Even so, the authors oppose the interests of skilled and educated immigrants against those of the unskilled and uneducated. In doing so, I think they go a bit too far.

It is one thing to say that the influx of competitive, driven, educated, and skilled immigrants has not received enough positive attention in the current debate. Clemons and Lind are right on that score. As they write, “more talent means more innovation and opportunities for all, immigrant and native alike.”

They don’t think this holds true for unskilled immigrants however, and view them in a rather less positive light: “with the vast pool of poorly paid, ill-educated laborers already within our borders, we do not need a third of a million new ones a year.” But to make their case, I don’t think Clemons and Lind have to pit the skilled against the unskilled.

It is true that higher competition for low-wage jobs will have the tendency to lower wages, but this is not necessarily a bad thing. It can be a powerful incentive for unskilled natives and immigrants alike to pursue new training and education to increase their standard of living. Being a line-worker at Subway is ideally not a career, but rather ought to be a transitional position and motivation for workers to increase the cost of their labor.

The Copenhagen Consensus of 2004 recommended policies that lower barriers to migration for skilled workers as a “fair” program, because they “were regarded as a desirable way to promote global welfare and to provide economic opportunities to people in developing countries.” The reason that the Consensus opposed guest-worker programs was not because low-skilled workers necessarily have a negative economic impact, but because they have a “tendency to discourage the assimilation of migrants,” by placing them in a social and economic position that is lower than natives.

Andrew Yuengert makes the case that there is a limited right to migrate in his monograph, Inhabiting the Land. The unskilled possess this right to no less of an extent than the skilled.

Blog author: jspalink
Wednesday, April 12, 2006
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In this week’s commentary, Jennifer Roback Morse takes a look at the socio-economic factors that influence the age at which young people aim to get married. Many are waiting. One reason why so many young people put off marriage unitl their late 20s or early 30s, says Morse, is that the cost of setting up an independant household is too high — unjustifiably high. Physically, humans are ready to reproduce in the mid-teens; financially, young people are not ready to be independent until their late 20s; the cost of housing and debt are often obstacles. During this waiting period — a time of sexual-economic tension — young people pick up many habits and expectations that are not compatible with maintaining a healthly marriage.

So, what can be done? Read Morse’s commentary to hear one approach to the problem.

On a related note – Zenit interviews Maggie Gallagher about the importance of a healthy marriage in the lives of children. In a nut-shell:

  • Marriage reduces the risk of poverty.
  • Fatherless households increase the risk of involvement in crime.
  • Marriage protects childrens’ physical and mental health.

It seems that it may be possible. An interesting article from yesterday’s International Herald Tribune:

Danielle Scache tries to avoid using the term “capitalism” in her economics class because it has negative connotations in France.

Instead, she teaches her high school students about the market economy, a slightly less controversial term she started using last year after a two-month internship at the dairy giant Danone. That was an experience that did away with more than one of her own prejudices, she said.

“I was surprised to see that people actually enjoyed working in a company,” said Scache, who is 59. “Some of them were more enthusiastic than many teachers I know.”

“You know,” she confided with a laugh, “in France we often think of companies, especially multinationals, as a place of constant conflict between employees and management.”

This view of bosses and workers as engaged in an endless, antagonistic tug-of-war goes some way toward explaining the two-month rebellion against a new labor law.

Read the whole thing for an interesting look into the state of economic education in France.

French President Jacques Chirac has given in to the student protests in his country, protests that called for the removal of the First Employment Contract. This is a controversial new law giving employers greater freedom in whom they fire amongst under-26 employees. The law, as I am sure you’ve seen, sparked students protests for weeks.

Michael Miller in last Wednesday’s Acton News and Commentary addressed the deeper issue here: economic ignorance and moral apathy–I won’t repeat his analysis here. But here’s what I’d like to point out: what will fill in the vacuum.

The minister of employment, Jean-Louis Borloo, told Le Monde newspaper that the new plan will include increasing government subsidies to employers who hire people under 26 who face the biggest obstacles to finding jobs. He said the cost to the government in the second half of the year would be about $180 million.

From more economic freedom to subsidies. It is one thing to surrender to the protests and remove this law. It is quite something else to enact an (apparently) equal and (certainly) opposite policy. One wonders what will be the straw to break the Gallic camel’s economic back. Perhaps we should start a betting pool…

As student demonstrations in France mount, the government finds it increasingly difficult to dismantle restrictive labor laws that are directly tied to high unemployment rates. Michael Miller examines the political and cultural factors that are behind the French fear of economic risk taking.

Read the complete commentary here.

Following up on yesterday’s entry about Ronald Aronson’s call for a renewed socialism in American politics, I offer this paragraph from J. Budziszewski’s book, What We Can’t Not Know.

Discussing the principle of subsidiarity as first explicitly articulated by Pius XI in the encyclical Quadragesimo Anno, Budziszewski writes,

As Pius explained, what pushed the principle of subsidiarity to the forefront was the crisis in civil society brought about by the industrial revolution. For a time it seemed as though the middle rungs of the ladder might be crippled or destroyed, leaving nothing but the vaunting state at the top of the social scale and the solitary self at the bottom. Collectivists and individualists made strange alliance to cheer this holocaust of the little platoons. The principle of subsidiarity reaffirms the social design of the species, corrects both its individualist denial and its collectivist perversion, and champions the rights and dignity of all those in-between associations which, if only allowed, will take root and flourish, filling the valley between State and Self with fruit and color.

Blog author: jballor
Monday, April 3, 2006
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Ronald Aronson argues that the political left in America needs to get back to its true socialist roots in order to become a coherent and clear alternative in this article from The Nation, “The Left Needs More Socialism.”

He points to contemporary political movements in other countries as models for success of the American left:

But Americans need only glance around the world to see that there are alternatives. The vibrant World Social Forums are an example, under way since 2001 and now envisioning several annual meetings of an immense variety of groups, organizations and networks. Another is the continuing leftward movement of South American governments, now adding Bolivia to Argentina, Uruguay, Venezuela, Chile and Brazil. A third is the continuing European efforts to defend social welfare programs, as evidenced in the German Social Democrats’ remarkable reversal of a slide into oblivion to tie the Christian Democratic Party in last September’s election, and the unflagging popular support for Britain’s National Health Service.

Aronson even goes so far to cite September 11 and Hurricane Katrina as instances that support the need for socialism. In his words, “September 11 and Hurricane Katrina showed the undying need for extensive and intensive structures of community. The socialist standards of fairness, democracy, equality and justice are as much a part of daily life as are capitalism’s values of privilege, unequal rewards and power.”

So here we see that socialism is committed to all things praiseworthy (fairness, democracy, equality, justice) while capitalism is committed to all things base (privilege, power, inequality). And Aronson dares to say that it is Marxism that is caricatured.

Aronson’s basic problem is that he has a fundamental bifurcation of the world into two groups: individuals and governments. So when he says that we need “extensive and intensive structures of community,” he really means we need more government (if it has any bearing on this discussion, Hurricane Katrina shows the basic ineffectiveness of statist solutions and is evidence in favor of a free, vigorous, and private civil society).

We can see that this is the case when Aronson writes, “Twenty-five years of attacking government has drained much of the basic civic spirit and social responsibility we must have to transact our collective business with integrity. If nothing is higher than the individual, the only thing that matters is whether I alone succeed.” Indeed the common good and society may be “higher than the individual,” but from this it does not follow that government is the only entity that fits that description.

Aronson’s caricature of capitalism does little to clarify the real disagreement. He makes the classic mistake of demonizing his opposition’s intentions and motives, rather than giving an honest and fair-minded analysis.

The disagreement isn’t whether or not all people have value, whether community is a good thing, or whether individuals have responsibilities beyond themselves. It seems to me that the real disagreement is about means. Aronson’s statism finds government to be the primary, if not sole, agent in meeting these responsibilities.

Blog author: jballor
Wednesday, March 29, 2006
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It has been a bit of a mystery over the last few months, as an anonymous group of developers had been purchasing up a series of properties near downtown Grand Rapids. The investigative work of the local TV news turned up the plans for the group to end up with a 41-acre area that runs along the Grand River through the heart of downtown.

Currently, the area is mostly made up of unused manufacturing facilities, abandoned buildings, and generally unproductive land. Over the last week, WOODTV 8 has learned the identify of one of the primary developers and their plans for the property. The project is called the RiverGrand, and Duane Faust of a developing company with offices in Atlanta and Los Angeles has been identified as a key player.

In an interview with Faust, 24 Hour News 8’s Suzanne Geha got Faust to describe the project: “We plan to build a large scale, mixed-use infrastructure development project that will serve as the standard bearer for not only Grand Rapids but the entire state of Michigan, making the transition from an industrial, manufacturing-based economy to a technology-economic-health care-entertainment as well as financial economy that everyone else is doing in the country,” he said.

There are currently no blueprints, but Faust says the project would take the best elements from other well-known developments, including Baltimore’s Inner Harbor, Atlanta’s “Atlantic Station,” and London, England’s Canary Wharf.

Like Baltimore’s Inner Harbor, the RiverGrand would have a marina for use by boaters. Similar to Atlanta’s “Atlantic Station,” the RiverGrand would be “a city within a city,” made up of mixed-use land that serves as the core of downtown economic, residential, and social activity. And akin to London’s Canary Wharf, the land would be the home for several high-rise buildings, which would “significantly” change the skyline of Grand Rapids.

Since the RiverGrand project is much smaller than these other developments, the similarities would be appropriated to the scale of the plan, of course. Even so, Faust predicts that RiverGrand will employ 10,000 people.

This is good news for an area that has been hit hard by recent manufacturing losses. Electrolux, which at one point employed 2,700 people in Greenville, Michigan, closed its doors earlier this year. The key for the Faust plan is that Michigan is to move beyond a primarily industrial economy, and the attractiveness of the RiverGrand project is the diversity of economic opportunity it embraces, from tourism, music and entertainment, to commercial and finance industries.

This is in marked contrast to the plan from the politicians in the state’s capital. On the heels of the Electrolux move, Gov. Granholm trumpeted the news of a new plant being opened in Greenville, which would employ 500 people. The facility is owned by United Solar Ovonic, which is a developer of alternative fuel techonlogies, including the production of solar cells.

It’s clear that the Lansing politicians see the future of Michigan’s economy to be a continuation of the industrialized past, as two consecutive administrations (Engler and Granholm) have used tobacco settlement funds to set up technology and biotechnology funds for new endeavors in Michigan.

The problem with such efforts is that the liberty of entrepreneurial enterprises should not be pitted against the determinism of lawmakers. As we have seen, the transition from an industrial economy can be difficult for many in the short-term. And while it is tempting for politicians to try to find for themselves the next big thing, they must resist that temptation and simply place Michigan in a position where it has a clear and fair tax structure that is competitive with other states and nations.

Technological innovation will always be an important part of a robust economy. But a diversification that deals with the realities of a global economy will be the real answer to long-term growth. For that reason, the future hope for Michigan lies more with entrepreneurial endeavors like the RiverGrand project as with the decisions of Lansing lawmakers in determining the future industries of Michigan.

Projects like the RiverGrand will do more to make Grand Rapids a “cool city” than state programs ever could.