Whitcomb: Worcester Gets Poorer; Fung’s Tax-Cuts; Drunken Past; ‘The Other Recession’

Monday, October 01, 2018

Robert Whitcomb, Columnist

“October sunshine bathed the park with such a melting light that it had the dimmed impressive look of a landscape by an old master.” 

― The late Elizabeth Enright, from The Riddle of the Fly & Other Stories

 

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“The past is another country; they do things differently there’’

 

-- The opening lines of the novel The Go-Between, by L.P. Hartley; the book was made into a great movie with the same name. I thought of this during the Kavanaugh hearings.

 

Emptying the Oceans

 

The Lobster Coast: Rebels, Rusticators, and the Struggle for a Forgotten Frontier, by Colin Woodard, is a history of the storied Maine Coast in which the ups and downs of the fishing industry in the Pine Tree State have played a big part.

 

The book is a deeply researched, reported and colorful narrative. It may also be of particular interest to New Englanders now in light of the overdue restrictions just imposed on the herring fishery. There are many lessons to be gained from a study of the management and non-management of fish species in the spectacular protein factory known as the Gulf of Maine. Overfishing has led to the Maine Coast having only one major commercial species left – lobsters.  Catches of such formerly lucrative species as cod, haddock and halibut are a fraction of what they were a few decades ago.

 

All too often fishermen blame “natural cycles’’ for fishing stocks that are collapsing because of extreme overfishing. Modern fishing techniques, including fish-finding electronic devices and bigger, better nets and boats, have had devastating impacts. Overfishing of such species as herring that are essential food for the survival of larger fish can be particularly damaging to fishing ecology.

 

So it was muted good news that federal regulators decided to slash catch limits by 55 percent and impose buffer zones where no commercial herring fishing would be allowed. However, many scientists think that the whole herring fishery off New England should be shut down for a while in order to save it.

 “The population is stressed, and we really need to start building resiliency,” Erica Fuller, senior lawyer with the Conservation Law Foundation, told the council.

Rarely does any economic interest group eschew short-term profit for long-term gain. People will almost always take the money and run. (An apparent exception is Maine’s lobstermen’s remarkably cooperative and voluntary efforts in recent years to save that fishery.) Strong measures can do wonders in saving species, as in the case of striped bass, whose revival owes much to the late Rhode Island Sen. John H. Chafee’s push for research and regulation to save the sportfish from extinction off the East Coast.

 

Cut R.I. Taxes and What Else?

 

Rhode Island’s Republican gubernatorial candidate, Cranston Mayor Allan Fung, seems to hew to GOP theology that all problems on earth and in heaven can be fixed by tax cuts. We’ve come a long, long way from the careful, pay-as-you-go conservatism of President Eisenhower.

Thus, Mayor Fung backs a $300 million sales-tax cut; immediately raising the exemption on the state inheritance tax to $1.5 million from $900,000, and eventually hiking the estate-tax exemption further to make it closer to the $5 million federal estate-tax exemption. (The GOP has always been particularly excited about cutting taxes on the affluent, particularly those who chose their parents with such care that they inherit a lot of money.)

 

He also, among other goodies, wants to cut the 18 percent interest rate on unpaid taxes and create a 10-year limit on forcing people to pay unpaid taxes. Nice way to encourage tax avoidance! The law abiders will have to make up the difference.

 

Voters are looking forward to hearing how a Governor Fung would pay for such essential things as roads, the state police and education after these alluring cuts, especially in the next recession, which many economists think will come in 2020.  In any case, I hope that Mayor Fung and his major opponent, Democratic Gov. Gina Raimondo, consider ways to make Rhode Island’s state tax system simpler and as competitive as possible with Massachusetts; on the latter it has little choice because the Bay State is so much bigger. Simplification of filing (especially of those tedious tax forms) and record-keeping requirements can save taxpayers a lot of money, although it cuts into the income of accountants and tax lawyers.

 

Meanwhile, it’s far too early to judge whether Governor Raimondo’s “free college’’ program, being touted in the campaign and called Rhode Island Promise, will be a success. 
 

GoLocal has reported that of the program’s first-year students, nearly 40 percent did not return for their second year at the Community College of Rhode Island — despite the free tuition. Can’t find the time to go to college and hold a job? Family duties? Other reasons?

 

But one thing that policymakers should keep in mind is that many jobs associated with having a college degree will be destroyed by the likes of artificial intelligence and automation. The surest jobs going forward include the trades – electricians, carpenters, plumbers, etc. Let’s expand apprenticeships in them.

 

New England’s Most Exciting College

 

On Sept. 21 I attended a few hours of the biennial International Seapower Symposium, with people from more than 100 nations in attendance, at the U.S. Naval War College, in Newport. We heard heads of navies and other luminaries from various countries discuss “illicit networks’’ involving drug smugglers, illegal fishing, which threatens the survival of species, and other bad stuff at sea and in port. But what I most remember is the spectacular setting along a glittery, breezy Narragansett Bay with the  graceful Pell Bridge  gleaming in the sun as I chatted  with naval officers about such matters as the militarized islands that the Chinese are building to try to control the South China Sea and efforts to find the wreck of the Endeavor, Captain James Cook’s research vessel, which was scuttled in Newport Harbor in 1778.

 

The Naval War College is an exhilarating place, however grim its essential mission --  to fight wars.

 

 

Worcester Gets Poorer

 

I wonder what lower-income people in Worcester think of U.S. Census data that show that the median income for Worcester households fell nearly 6 percent last year even as plans were being solidified by the city to spend a fortune to help build a baseball stadium for the bunch of very rich businessmen who own the Pawtucket Red Sox. Given the record of Minor and Major League stadiums built over the last couple of decades, it seems unlikely that the “Woosox’’ stadium will make things better for the city’s poorer residents.

 

Worcester’s unemployment rate is only about 5 percent but many of those jobs, as around America, pay poorly and/or are part-time. Indeed, the very low official U.S. unemployment rate masks the fact that many people have dropped out of the workforce because of low wages that don’t keep up with inflation.

 

A large factory being built in the city would be far better news than a facility, like a baseball stadium, employing only a couple of dozen full-time jobs, if that. Hard to believe now that the city was once sort of the Pittsburgh of New England!

 

In other parts of the bread-and-circuses industry, we have the newly opened MGM casino in Springfield, Mass. Despite the hoopla, this facility, which will drain money from the region to send to investors, isn’t doing that well.

 

Consider that the slot-machine take at this full-service (table games, slots and “resort hotel”) scam is about the same as at the much less promoted and all-slots Plainridge Park, in Plainville. Will the commonwealth encourage more cannibalization of this sector by permitting yet another casino to open?

 

The Promise of Pop-Up Stores

 

The Internet, and especially the increasingly monopolistic Amazon, are eroding much of the traditional bricks and mortar stores. But, as I learned from my silver jewelry-making daughter in New York City, “pop-up stores’’ – short-term retail outlets in rental storefronts -- provide new ways of showing and selling stuff.

 

They speak to the desire of many, perhaps most customers to touch, see and even smell goods in a real place. For that matter, even Amazon is opening brick-and-mortar stores.

 

Local zoning regulations may have to be changed in some places to encourage the creation of pop-up stores, which sure are better than vacant storefronts. I think that these outlets would do best in already busy upscale shopping streets, such as Bellevue Avenue, in Newport, Newbury Street, in Boston, and Thayer Street and Wayland Avenue, on the East Side of Providence. Such temporary outlets would seem particularly handy for test-showing new products.

 

Trump Theatrics at the U.N.

 

It’s no wonder that many attendees shook their heads and laughed at Trump’s incoherent, absurdly narcissistic, hypocritical but entertaining rant of an address to the U.N. General Assembly last week.  His bragging and denunciations of Iran’s “brutal’’ and “corrupt dictatorship’’ and warm praise for the much more corrupt and brutal regime in North Korea made for quite a show. Also exciting was his attack on international organizations that the U.S,. helped to create, out of enlightened self-interest to address, in part, the existential challenge posed first by the Soviet Union and later by other tyrannies, too. All this seemed to be mostly pitched to, say, a Trump rally in West Virginia.  MAGA magic!

 

Trump, in touting an amoral international order, also said nations should butt out of the affairs of other nations. Except, that is, for Iran, which he fears much less than the much more formidable U.S. foes – China and Russia. “We ask all nations to support Iran's people as they struggle to reclaim their religious and righteous destiny."

 

Oh yes, Trump has warned South Africa about its land-reform policies; lectured British Prime Minister Theresa May about Brexit; threatened to attack Venezuela, and mused about assassinating Syria’s Bashar Assad. Trump’s respect for national sovereignty stops at the water’s edge, whatever his statements about the all-importance of
“sovereignty’’.

 

And, of course, while he complained that “Iran’s leaders sow chaos, death and destruction. They do not respect their neighbors or borders or the sovereign rights of nations,’’ he said nothing about Russia’s war on, and seizure of part of, Georgia; its occupation of Ukraine’s Crimea; its war on eastern Ukraine; the Russians’ continuing assaults on the voting systems of Western democracies, and Putin’s assassinations of political enemies at home and abroad.

 

To divert attention from Russia, Trump on the day after his U.N. speech accused the Chinese of trying to interfere in our mid-term elections. The fact is that it is the Kremlin, not China, that is primarily hard at work trying to invade state voting systems and spread misinformation (in league with some of their Republican Party friends). The Russians will go to great lengths to keep the Democrats from taking control of Congress -- control that would open up more investigations of the Trump campaign’s collaboration with Russia, as well as of other corruption involving Trump associates. Not that Chinese President Xi Jinping is America’s friend….

 

The U.N. has plenty of faults, especially the power of dictatorships to all too often block attempts by U.N. members that are democracies’  to stop aggression and aid the victims of tyranny. But by providing an international forum through which at least some conflicts can be prevented or stopped and having U.N. agencies that can help address humanitarian crises, the organization has done far more good than harm in the world, and in so doing has made the United States, more, not less, secure.

 

Perhaps Trump and his followers never noticed that international cooperation has helped spread prosperity, prevented some conflicts and helped spread democratic values around the world. America has been a huge beneficiary. Previous U.S. presidents, all of them far more knowledgeable than Trump, pursued international cooperation, through NATO, the U.N., the World Bank, etc.,  because it was in our national interest.

 

Trump is fortunate that so many of his followers know little history.

 

And so American influence continues to decline. But it may take a recession to persuade Trump’s cult-like followers to reconsider their adulation of their man-child leader.

 

At the moment, it seems that French President Emmanuel Macron is the leader of the Western world. We could do worse. But, yes, other NATO members should contribute more to their collective defense against Russian and other aggression.

 

Some Sunlight on Campaign Donations

 

But wait! There’s good news too! The U.S. Supreme Court has let stand, for now, a lower court ruling that throws out a corruption-causing Federal Election Commission rule. This regulation let “nonprofit groups’’ that are sometimes simply enterprises that seek to expand the wealth and power of clients keep their political donors’ names secret.

 

The ruling (which might still be eventually killed by an ever-more Republican-controlled U.S. Supreme Court) forces these “nonprofit’’ groups to publicly report the names of donors giving more than $200 a year to influence a federal election. Formal Political Action Committees have had to disclose the identity of their donors but of course there have always been ways to hide their identities. The “dark money’’ gets darker.

 

This case means that voters watching this year’s very important mid-term election campaign will have more of chance to find out the identities of the self-interested rich folks (e.g., Koch Brothers and casino mogul and Trump pal Sheldon Adelson) who use “nonprofit’’ groups to back candidates who will promote their business interests.

 

“This is a great day for transparency and democracy. We’re about to know a lot more about who is funding our elections,’’ said Noah Bookbinder, executive director of Citizens for Responsibility and Ethics in Washington. Well, every bit helps but the nation will continue to be more of a plutocracy than a democracy, in part because of the sloth of so many people who won’t bother to take 20 minutes to vote.
 

Most forecasts say that Democrats will probably take the U.S. House in the mid-terms. But given GOP gerrymandering, the Republicans’ access to bigger campaign contributions and interference by Trump’s pals in the Kremlin that’s no sure thing.

 

In any event, if the Dems win, they’d do well to elect a speaker who can better appeal to the voters who have been conned by Donald Trump than Nancy Pelosi, the rich lady from San Francisco whom the GOP has long pilloried as an elitist and purveyor of “identity politics.’’ Ms. Pelosi, the former speaker, is very able, but somebody else, preferably someone from a middle class or working-class background, would be more effective in expanding the Democrats’ base.

 

The party’s leaders need to move away, at a brisk pace, from identity politics (race, sexual orientation and so on) and appeal to Trump voters’ economic interests as well as  to their desire for good public services and infrastructure. Those are issues that can attract many of Trump’s 2016 voters and the left.

 

In short, the Dems need to focus on appealing to citizens on the basis of what unites them, whatever their ethnic or other personal “identity, ‘’ as they did back in the days of Franklin Roosevelt and Harry Truman. That means appealing to their desire for a better chance at achieving the “American Dream,’’ however they define it.

 

As Sheri Berman wrote in The Guardian this summer:

 

{I}dentity politics is …more powerful and efficacious for Republicans (and right-wing populists more generally) than it is for Democrats, since the former are more homogeneous.’’ To read Ms. Berman’s piece, please hit this link:

 

The Other Recession

 

Michael Porter, a professor at the Harvard Business School, had a disturbing column in The Boston Globe the other day headlined “America Traded One Recession for a Far More Serious One,’’ instigated by the 10th anniversary of the Crash of 2008. He cited something called the Social Progress Index. Among his observations:

“Despite being among the wealthiest nations, the United States ranks 25th overall on social progress, behind all our peers in the Group of Seven. In important areas, the United States ranks even lower: We are 61st on secondary school enrollment and 88th on homicide rates. Despite spending more per capita than any other nation on earth on health care, we achieve just 62th on maternal mortality, 40th on child mortality, 47th on premature deaths from noncommunicable diseases, and 35th on life expectancy at age 60.’’

“In equality of political influence among lower socioeconomic groups, we rank 65th.’’

“Americans’ overall health and wellness is way below other advanced countries, and quality of life and economic opportunity for many is diminished.’’

To read Professor Porter’s essay, please hit this link:

 

High-Anxiety Weeks in 2008

 

Now that we’re in the 10th anniversary of the Great Crash of 2008, I vividly recall those weeks in the late summer and early fall of that year, particularly because I used to be a business editor and because I spent some time then with two in-laws who were deeply in the know about the crisis, though they didn’t necessarily know how to respond. They had to wing it.

 

One was a very high-level official of the Federal Reserve with whom we dined a couple of weeks before the collapse of Lehman Brothers almost brought down the whole shaky and hugely over-leveraged American economy. He was clearly very distracted that evening.  Something ugly was up. He had to be very careful about what he told us.  But the anxiety was nothing compared to what it would be a couple of weeks later when he spent long, stressed-filled hours in Washington and in and around the Federal Reserve Bank of New York, the vehicle for much Fed action to try to stem the crisis

 

Then, in  September, as Lehman went down and other big dominoes teetered on the edge of a very high cliff, we spent some time with another of my in-laws right after the death of my mother-in-law. He was and still is a managing partner of a large and old “white shoe’’ investment company, founded back in the 1920s and known for its wariness about investment fads, be they dot.com companies or the mortgage-backed securities that helped cause the crash.

 

He was quite relaxed about the panic, looking at it with clinical interest. His “value-investor” firm,  which had some old connections with Warren Buffett’s Berkshire Hathaway, had made its name with its ability to spot bargain-priced stocks. He saw a rough few months ahead but lots of opportunity for the patient. But patience was in short supply as all too many people started to dump stocks at fire-sale prices after buying them at sky-high prices a year or two before.

 

Cop Overtime Angst

 

The Massachusetts State Police overtime scandal is a reminder of how often police have been found to have put in for bogus overtime in jurisdictions around America. It’s a tough thing to, well, police.

 

The Interminable Kavanaugh Case

 

The famous quote by William Faulkner that “The past is never dead. It’s not even past’’ comes up when hearing the allegations about Brett Kavanaugh.

 

But first, where was Mark Judge? I repeat, where was Mark Judge. (See below.)

 

By the time that you read this, the fate of the federal appeals court judge’s nomination to the Supreme Court may be decided. Given the passage of time since the alleged events at issue and that so much of his social life and that of people around him involved alcohol, we may never know the degree of his guilt or innocence in alleged sexual offenses.

 

We do know for sure that this very bright and slick fellow used to get drunk a lot.
 

We also know that he has lied about some aspects of his youth as well as about some of his work  in the G.W. Bush administration. His career shows him to be an intense, even ruthless Republican loyalist. (The future judge, then a zealous lawyer in special counsel Ken Starr’s investigation of  the priapic Bill Clinton in the ‘90s, showed great interest in the details of the president’s sex life.)

 

And his vehement, extremely political attacks last Thursday on Democrats  (dragging in the hated Clintons of course) in his response to Christine Blasey Ford’s allegation that he sexually assaulted her suggest that if he goes on the high court he’ll be among the most partisan justices in history.

 

Anyway, Kavanaugh was sometimes far from the nice young man he says he was.  Some people around him found his drinking, arrogance and belligerence disturbing. He sounds as if he could be a very nasty drunk indeed, and something of a spoiled brat. (He did some semi-Trumpian bragging about himself in the hearing Thursday.) Which isn’t to say that he didn’t learn early in life to pour on the charm, too, for social and professional purposes.
 

Judge Kavanaugh might well have been dead by now if he had continued his youthful rate of drinking. Good for him that he brought it under control. How different is he now? We’re all products of the hard-wiring we’re born with and experience. He’s sure a smooth customer now – usually. But who is the real Brett Kavanaugh, or are there a bunch of Kavanaughs, each adjusted to fit different audiences?
 

A practiced congeniality, higher than average intelligence and ambition and, crucially, a privileged socio-economic position (his father was a rich business lobbyist, his mother a judge) enabled him to climb the greasy pole at a good clip. And the American Ruling Class looks after its own; most of the rest of us must fend for ourselves

 

To see an amusing movie about who runs America, please hit this link:

 

Oh, yes, why wasn’t Mark Judge, of all people, who Ms. Ford says was the room when his pal Brett Kavanaugh was attacking her, called to testify? Details, details….
 

Health Care Renewal

 

One of the best places to read about the American health-care sector, and especially about its corruption through greed and conflicts of interest, is the blog of Roy M. Poses, M.D., called Health Care Renewal. I have read it for years and have found Dr. Poses a fine diagnostician of what ails our astronomically expensive and inefficient “system.’’ To read the blog, please hit:

 

Tree up Route 114

 

The best thing that Middletown and state people could do fast to alleviate the extraordinary windswept ugliness of the Route 114 commercial strip would be to plant as many trees as possible along the road.

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