Some thoughts on… Telling Stories

With the 20^th anniversary of 9/11, I wanted to share my experiences of the event with the new cohort of students as a way to remember.  Preparing for the lecture though, I realized that most of them weren’t even born at the time or were only 1-2 years old.  How do you describe the importance of a world event that is imprinted in your memory, to someone who wasn’t even alive at the time?

 

Here’s what I said in the end.

 

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This past weekend was the 20^th anniversary of 9/11.  As you may have seen there have been a lot of activities around the city remembering the date, but I realized most of you were too young or not even born at the time so you won’t have any experience to recall.  Many of you may even be wondering - Why is this such a big deal?

 

I think it’s a big deal and it’s important to listen to the stories and remember because people are storytellers.  The story of 9/11 is one of resilience – not just individuals getting through, but also of communities persevering.  I don’t want to glorify the event – this is not a simple rosy story. You may have heard how New York City became a kinder place in the months after 9/11 and how people came together in a shared sense of loss.  This was true.

 

But we also have to question the circumstances around the event.  The security lapses that allowed the event to happen.  The instability and income inequality in Middle-Eastern countries that engendered an attack on the US.  The spike in hate crimes that occurred in the ensuing months on Middle Eastern and Sub-Continent individuals.  And the 20-year war that was instigated in Afghanistan which only now is ending

 

That’s why we reflect on these historical events, because we only understand their impact by remembering the stories. The same is true of the story of the pandemic which is going to be imprinted in your memory and is still being written.

 

Everyone around the world remembers exactly where they were when they found out the planes hit the Trade Towers.  It was a global event.  Everyone (including you) also remembers where you were when the lockdown happened, e.g. our TA’s remember clearly the day that we stopped classes and the University evacuated all students.  

 

Similar to 9/11, the pandemic was a global event shared by almost every single human on the Earth.  It is seared into our brains.  We don’t have many of these – End of WWII, John F. Kennedy assassination, Moon Landing.  But when the global events do happen, they remind us that we are all tied together.

 

And just like 9/11, the pandemic brought people together, but it’s also not a rosy story.  We had lapses in management of the virus.  We have an unstable national health care system that made the spread easier.  We had a spike in hate crimes against the East Asian community. As for the future, we don’t know yet what the implications will be.  Maybe it will tear our country apart or pull us closer together.

 

An interesting aspect about both of these events is that although global, in some ways NYC was the epicenter or ground zero for both of them.  Although planes went down in Pennsylvania and Washington DC, the impact on downtown NYC is starkly remembered.  Similarly with the pandemic, in the first few weeks of Covid-19 NYC was experiencing an additional 800 deaths a day just here in the city (usually the rate is around 200 deaths a day). 

 

So next time you listen to these stories of reflection of past activities – I’d encourage you to do two things: 1) write down your own experience with the pandemic, so you can share your story later; and 2) appreciate that we are living in a city that’s been through a lot but it keeps going.  And that’s pretty amazing.

Some thoughts on… Building Bridges

Under President Biden’s administration so far, he has signed into law measures on Covid-19 Relief, addressing Asian American hate crimes, and making Juneteenth a Federal holiday.  But several major legislative initiatives are still being worked out in the House of Representatives and Senate, including revising immigration, supporting voting rights and rebuilding infrastructure.

 

Infrastructure bills have historically been non-partisan because they initiate jobs across the US primarily for non-college educated individuals and impact a wide swathe of the population regardless of political affiliation.  Biden’s $4.2 trillion infrastructure framework consists of two parts the  American Jobs Plan and the American Families Plan.  The framework is facing Congressional debate on two fundamental questions - what is considered infrastructure, and how the legislation will be financed.  Deferring discussion on the payment question, 

 

What is driving the disagreement on Biden’s proposals?

 

Infrastructure is recognized as the systems and services that households and firms use in a country in order to interact and make the economy function.  Examples include physical systems such as road and railway networks, utilities, sewage, water, telephone lines and cell towers, air control towers, bridges, etc., plus services including law enforcement, emergency services, healthcare, education, etc.  Without roads or law enforcement, firms cannot hire individuals, and households cannot get to work safely. 

 

In economics, the case for government involvement to finance infrastructure is nuanced because these items are typically neither pure private or public goods.  Governments have a clear mandate to step in and provide funds for public goods because they are non-excludable and non-rivalrous.  Once produced, a person cannot be excluded from using public goods, and one person’s consumption of the public good doesn’t affect another, examples include National Defense or streetlights.  On the other hand, private goods are both excludable and rivalrous – once a pizza is made, people can be excluded from consuming it, and if I do consume the item, it prevents your consumption.  The private sector is best suited to produce private goods – government intervention is typically not needed.

 

Many infrastructure items - roads, railways, bridges – are similar but are not pure public goods since they are non-excludable but can be rivalrous.  People aren’t excluded from roads and highways but use by too many people will affect others due to congestion.  Whereas some infrastructure items are excludable but non-rivalrous.  Once an electric grid or cell tower is built people can be excluded from using them, and my enjoyment of electricity typically will not affect other users.  The debate on infrastructure stems from the facts that for these hybrid cases there is not a clear government mandate to step in from an economics viewpoint.

 

The first piece of legislation, the American Jobs Plan ($2.3 trillion) has 6 components which include physical systems: 

1.     Rebuilding roads, airports, ports and transit systems (falls into hybrid: non-excludable but rivalrous)

2.     Deliver clean drinking water, a renewed electric grid, and high-speed broadband to all Americans. (falls into hybrid: excludable but non-rivalrous)

3.     Build, preserve, and retrofit more than two million homes and commercial buildings, modernize our nation’s schools and child care facilities, and upgrade veterans’ hospitals and federal buildings.     (More like private goods but these items address less served communities where government has typically intervened)

 

There seems to be bi-partisan support for these “hard” items.  The American Jobs Plan also includes services provisions to:

 

4.     Solidify the infrastructure of our care economy by creating jobs and raising wages and benefits for essential home care workers. 

5.     Revitalize manufacturing, secure U.S. supply chains, invest in R&D, and train Americans for the jobs of the future. 

6.     Create good-quality jobs that pay prevailing wages in safe and healthy workplaces while ensuring workers have a free and fair choice to organize, join a union, and bargain collectively with their employers.

 

In addition, the American Families Plan ($1.9 trillion) focuses on making education more affordable and expanding opportunities, providing economic security for families, and expanding tax credits that help workers and families.  Examples include $200 billion to provide free preschool to all 3- and 4-year-olds; $109 billion to offer two years of free community college to all Americans; $225 billion to subsidize child care for families and support child care workers; $225 billion to create a national family and medical leave program; Permanently increase tax credits for child care. 

 

From an economics point of view, the last three components of the American Jobs Plan along with the American Families Plan ($1.9 trillion) would not typically be considered public goods or hybrids, and are the crux of the disagreement on Biden’s proposal.  The main argument against funding these items is that they are social services which should not be covered by an infrastructure package. 

Although these latter items do not conveniently fall into the public versus private goods definition, they should still be considered infrastructure since they facilitate the interaction between households and firms which is what drives the economy.  Just like roads and airports, the new services economy of the 21^st century cannot function properly without provisions that ensure worker and family safety, training and the ability to organize.

 

At stake is a notion that to remain globally competitive, the US needs to help households engage more easily with employers.  The outcome of the package will depend on how effectively the White House can convince citizens and bi-partisan congressional representatives of the importance of shoring up these broader more expansive concepts of infrastructure.

 

In other words, Biden will need to build some emotional bridges before building the physical ones.

            

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Some thoughts on… Voicing a Perspective

Following the 2020 elections, over 43 states are introducing legislation to modify voting procedures.  Georgia’s recently passed legislation has caused Major League Baseball to move its Draft and All Stars Game away from Atlanta while Coca Cola and Delta Airlines have denounced the new laws.  This week, hundreds of companies posted a full-page ad in the New York Times denouncing limits in voting.  Some politicians have argued that companies should not get involved.  

 

So, should companies be voicing their perspective on political issues?

 

The conventional wisdom is that private sector companies should focus on the business of maximizing profits, i.e., both Republicans and Democrats drink Coke.  Economics shows that corporations are highly efficient at selling “private goods”, goods and services that are excludable and rivalrous.   Excludable means that Individuals can be effectively excluded from using them, and rivalrous means that the use by one individual reduces the good's availability to others. People cannot get a seat on a Delta flight without paying for it, and once that seat is taken, no one else can use it during the flight.

 

Government on the other hand are one of the few entities that can effectively provide “public goods”, goods and services that are non-excludable and non-rivalrous.  Clean air, street lighting, military defense, laws, are all examples of items that can be consumed without purchase and my use of them does not prevent others usage.  Preserving the ability to vote is a public good under the purvey of local, state and Federal legislation, companies typically should not get involved in the process.

 

Yet, private sector companies have been involved in the political process for some time, especially through financial lobbying.  The impact of lobbying became more pronounced in 2008 with the Supreme Court ruling on Citizens United vs. Federal Election Committee, allowed corporations and other outside groups to spend unlimited money on campaign advertising as long as they are not formally “coordinating” with a candidate or political party.  

 

The ruling reversed previous judicial precedent, and brought enormous spending by outside groups into political causes with money flowing through super-PACs.  The Supreme Court decision bolstered the argument that corporations are essentially people. An argument that was espoused and jeered down the political spectrum.  

 

Surprisingly over the past decade, companies have become more like people, or more precisely they are more willing to represent the voices of the people that they serve.  Historically, companies only focused on their bottom-line profits to satisfy shareholders, but now they are including perspectives of their employees, customers, and the positions of their executives.

 

With millennials an increasing voice the workforce, this cohort is expecting companies to take a greater stance on social concerns.  Whereas before companies may have been more tentative in expressing their opinions as they didn’t want to disenfranchise their core customer groups, now they realize that the core groups are expanding and customers are more diverse.  For example, Hermes, a luxury fashion company, has progressed from barring entry to Oprah Winfrey to having non-white people prominently shown on their ads.  The public is also more comfortable with companies speaking up on political issues.

 

Companies voicing their support for certain legislation is a logical and more transparent evolution from the practice of sending campaign financing to certain politicians.  As teachers, we encourage students to express their perspective.  We train them to make a strong argument and then voice it.  The Democratic party might be happier now that companies are acting more like people and expressing their voices.  But just as the Republicans have found, this could be a double-edged sword.  

 

We should encourage companies to express their voices, and recognize just like people that their perspectives may change depending on their community and financial situation.

 

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Some thoughts on… Setting an Agenda

About a third of the way into President Biden’s first 100 days, he has created more than 30 executive orders indicating his top priorities, including:

• Covid-19
• Rejoining the WHO
• Establishing a central pandemic coordinator
• Promoting masks on Federal property and flights
• Reopening schools
• Extending enrollment time for Medicaid/  Affordable Care Act
• Environment
• Rejoining the Paris Climate Agreement
• Placing a moratorium on activities in the Arctic
• Establishing a National Climate Task Force    
• Economy -Increasing federal spending to American companies       
• Social Issues
• Revoking the Pentagon’s ban on transgender people in the military
• Resuming funding to non-profits providing counseling on abortions
• Enforcing sex discrimination protection for Federal agencies
• Establishing a President’s Council of Advisors on Science and Technology  
• Immigration
• Revoking restricted entry for Muslim countries
• Deferring removal of undocumented children brought to US
• Halting construction of Border Wall
• Reunifying children separated at the border

 

The administration is also pushing through legislation for a $1.9 Trillion Covid-19 relief bill which would potentially provide $1400 checks to Americans.  It’s heartening to see an administration working to solve issues addressing the American populace instead of focusing on their personal needs and covering up scandals. 

 

But Executive Orders are temporary and many of them are reversing measures placed by the previous Administration. Lasting change requires instituting laws and bolstering government services. Yet, as a country, we have pared back government, introducing unforeseen challenges to running the country, since the Federal Government still performs critical functions like disposing nuclear water, feeding the poor and avoiding weather disasters.

 

In Michael Lewis’ book, The Fifth Risk, he demonstrates how removing expertise in three Departments – Agriculture, Energy and Commerce – has led to situations where the government is “responding to long-term risks with short-term solutions… Creating an existential threat… [from the] innovation that never occurs and the knowledge that is never created, because you have ceased to lay the groundwork for it. It is what you never learned that might have saved you.” Covid-19 has made even more prominent the faults in our social structures.

 

With a new Presidency, I am wondering where I would focus my agenda.  Following on Michael Lewis’ concept – what are areas i) that need long-term solutions, ii) that may lead to an existential threat of the democracy if not managed properly and iii) can be solved by good government.

 

·      Enabling Access to Voting.  The 2020 election demonstrated that mail-in ballots, early voting, and secure elections are a necessity for our republic.  In January, Congress introduced H.R.1. – For the People Act of 2021 to ensure future elections are also accessible.  The Act would have the Federal government work with States to modernize voter registration, strengthen early voting and mail voting systems, and Restore the Voting Rights Act.  Arguments against the Bill are that it takes away States rights and potentially leads to voter fraud.  The Bill can be revised to get bi-partisan support.  Without measures that protect voting access, prevent political intervention, and avoid voter fraud, the repression of American voters will aggravate social and racial tension pulling the country further apart.

 

·      Eradicating Government Corruption.  Since 1995, Transparency International, a global non-profit, has published the Corruption Perceptions Index, a global indicator of public sector corruption. From 2016 to 2020, the US moving from 18^th to 25^th place in the rankings dropping behind U.A.E. and Bhutan in corruption – a significant decline for an OECD country.  Congress should pass legislation that ensures tax returns are released for public officials before election, debts owed to Foreign nationals are revealed, or tax-payer money spent on personal gain is exposed. Without these ethics measures, citizens’ trust of the system is eroded threatening democracy.

 

·      Building Information integrity.  George Orwell’s 1984, describe a dystopian world where reality is slanted by the Government to keep people under control.  In our world, where “alternative facts” are encouraged by the advisors to the President, the existential threat is the US ending up as an Orwellian country where citizens cannot agree on the reality around us.  Ironically, Congress is needed to fix a problem that government officials perpetuate.  Partnership between the private sector and Federal policy is needed to flag and stop dishonesty, especially on the internet.  For example, misinformation on the 2020 elections dropped 73% when social media platforms suspended accounts of fewer than 10 people in January of this year.  Without measures to prevent dispersion of deception, voters can be polarized and misled.

 

Since the 1980’s, as a society we have deprioritized regulation.  President Reagan infamously said – “The nine most terrifying words in the English language are: I'm from the Government, and I'm here to help.” The sentiment led to over 35 years of dismantling local, State and Federal government, leaving us with weakened regulatory structures. 

 

Rebuilding government infrastructure in meaningful areas could be the agenda of this Administration. Passing bold, imaginative legislation similar to the Civil Rights Acts passed in the 60’s during the social/ racial conflicts and the Ethics in Government Act passed after President Nixon’s resignation, could help heal the country and prevent erosion of our democracy.

 

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Some thoughts on… Stealing an Election

The House of Representatives sent articles of impeachment to the Senate a second time for Donald Trump with the charge of “incitement of insurrection”.  Politicians are debating whether citizen Trump can still be impeached even if out of office.  Constitutional scholars will weigh in.

A more important question for me is why elected officials allowed a sitting President to tell a series of falsehoods accumulating into a grand lie on the result of the 2020 election that led to the incitement of insurrection.  In the organizations for which I have worked, this deceitful behavior could not have lasted four years. Other organizational leaders, employees, customers, or the Board would have checked the conduct as detrimental to the goals of the organization.

The President should be questioned by other branches of government (legislative, judicial), State leaders, members of the Administration, citizens and the Press.  Over the past few years, the latter two bodies were quite active in bringing him to task.  Although the press did amplify his tweets and pronouncement, it was Congressional leaders, State Governors and Administration officials who fell short on their responsibility of balancing power.

The falsehoods seemed to pass through three levels.  

At the first level, when Trump started telling falsehoods, individuals chose not to push back as the lies seemed harmless, and “politicians exaggerate the truth all the time”.  Examples of the untruths are:

• Claiming more people attended the 2016 inauguration than Obama’s (photos by the National Park Service prove otherwise)
• Claiming the trade deficit with China was over $500B for several years before his Presidency (it actually maxed at $410 B in 2018 under Trump).

At the next level, the lies got bigger and had financial or legal impacts.  In these cases, Administration officials instead of pushing back, actually kicked into action to support the propagation of the lies.  Examples of the untruths include:

• Claiming Hurricane Dorian in 2019 would hit Alabama even though it was not supposed to get past Florida.  The declaration and repeated support by the Administration led to confusion and waste of resources as states unnecessarily prepared for a hurricane.   An independent investigation showed that Agency leaders at the urging of the White House violated Scientific Integrity.
• Claiming Trump was unaware of $130,000 payments to Stormy Daniels, a prostitute, even though he personally reimbursed his lawyer.  The campaign contribution is illegal because they weren’t recorded in campaign finance reports and exceeded the maximum amount allowed. 

At the top level, the lies were so big that lives were lost to violence and inaction.  In these cases, both the administration, Governors, Senators and Congressmen supported and propagated the lies further.  Examples include:

• Claiming the Covid-19 virus is under control and the loss in life could be contained.  Recently, the CDC predicted over 500,000 domestic deaths from Covid-19 in one year – more than the number of Americans who died in battle in WW1, WW2, Korean War and Vietnam war combined.
• Claiming the 2020 election was rigged and that Trump actually won. This resulted in a mob descending on the Capitol leading to deaths of police officers, looting and theft.

In addition to Trump, I believe we need to hold accountable the people that allowed these lies to grow and that propagated the “big lie” that the November election was stolen due to massive fraud implying the Electoral College results were not valid.   

The Congressman for our district, Lee Zeldin, is one of these individuals, and I have written the below letter to him.  He voted to overturn the electoral count even after the violence occurred at the Capitol.   You can find your Congressional representative, and see how they voted on approval of the Electoral College.   If you approve or don’t approve, send a note to them on their website (they all have one), and feel free to use any or all the text below.

The irony of the “big lie” is that the 6 Senators and 121 Congressmen who voted to overturn the Electoral College results, were the ones that actually tried to steal an election.

 

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Congressman Zeldin,

I am writing to express my disapproval of your objection to the Electoral College results on Wednesday, Jan 6.  You may think you were representing your Congressional District, but you were not representing me or my community.

What is most surprising is that you chose to overturn the Electoral College results, even after you witnessed the violence that was occurring on Capitol Hill which left several people including police officers injured or dead.  This act of sedition was spurred on by Donald Trump, and you along with him, are responsible to contributing to the mob’s actions.

Your repetition and propagation of the lie that the November election was stolen due to massive fraud and that the Electoral College results were not valid, was believed by millions of Americans and sowed distrust of the election process.  I worked the polls for 17 hours on Election Day in NY 1.  Along with fellow Democrats and Republicans, we tirelessly ensured integrity in the results.  The President’s and your allegations without any proof demeans the work of millions of workers across the US who delivered one of the most secure elections as stated by the White House itself.

In the end, it was you and the other 121 Congressional colleagues that tried to steal this election, and because of that you and your staffers should be held responsible. History and voters will ultimately judge whether your actions over the past few weeks were an act of moral uprightness or cowardice.  I know where I fall on this choice.  

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Some thoughts on… Sinking Ships

A number of metaphors are attached to sinking ships.  Supposedly “rats are the first to jump from a sinking ship” and “good captains always go down with sinking ships”.  Also, “deck chairs get re-arranged” and “the band plays on” while ships are sinking.  A week into the new year, and we witnessed a President urging a mob to disrupt Congress from voting on Capitol Hill.  The nation and the world were dumbstruck. 

As the White House sees many of these metaphors play out, with less than 2 weeks left of the Administration what will be the legacy of this sinking ship?

 

Reflecting over the past four years, there were a few accomplishments:

 

1.     Establishing multi-lateral relations between Israel and the Arab countries of Dubai, Bahrain and Morocco.  The entrenched politics of the Middle East suddenly opened up, as trade, commerce and international relations started to flow between these countries. 

 

2.     Pushing back on China’s expansionary trade policies. Although risky, placing sanctions on Huawei due to national security reasons was a bold move. 

 

3.     Engaging the US populace into civic action.  The largest percentage of the US voting populace participated in the Nov 2020 elections since 1908. Likely an outcome that the President did not intend to happen, but a consequence of his actions nonetheless.

 

But these accomplishments were burdened by policy set-backs.

 

1.     Separating immigrant children from their parents at the border.  Over 600 of these children have still not been reunited with their parents – a humanitarian nightmare. 

 

2.     Withdrawal from the Paris Climate Agreement and World Health Organization.  Although not a lasting impact, since these international groups can be rejoined, it sent a strong signal that many are still in denial about the importance of Global Health and Environment maintenance.

 

3.     Encouraging foreign officials to intrude on domestic affairs. By openly calling for Russia, Ukraine and China to interfere, the President undermined the validity of the election process and broke the law.

 

4.     Handling of the COVID-19 pandemic.  With the highest total deaths and excess deaths per 100,000 people, the US leads all other OECD countries in fatalities from COVID-19.  Inconsistent pandemic response on issues like mask wearing, disrupted supplies of PPE to hospitals and minimal Federal contact tracing programs – all contributed.

 

The President’s story before he took office and during his tenure was simple to follow – he portrayed himself as an aggrieved underdog, persecuted by elites, who only wanted a chance to reap the riches to which he is entitled.  

 

This story echoed the voices of tens of millions of American and tapped into their personal stories of jobs, lives and opportunities lost to a global economy that is fostered by the meritocratic elite - a vanished American Dream.

 

A number of legislative policies could potentially have helped American workers:

-       Programs to retrain and teach skills to individuals whose positions have been off-shored 

-       Measures to strengthen workers unions which were handicapped since deregulation started in the 1980’s

-       Major infrastructure initiatives to rebuild roads and bridges that would employ skilled construction workers

 

The Administration did not push through any of these programs to help disaffected Americans.  The crowning legislative achievement was the 2017 Tax Cuts and Jobs Act which in the end did not add jobs as expected and according to a Congressional Research Service Report put more money back in the hands of large companies and shareholders through stock buy-backs.

 

Amidst all these policy accomplishments and failures, one overwhelming success was the President’s finances.  During his time in office, he was able to help his family businesses which were virtually bankrupt before the Presidency, earn more than $1.9B in businesses during the first 3 years of his term.

 

History in the end will judge the accomplishments of this ship’s voyage — whether it was an earnest odyssey to reclaim the American dream for millions of individuals, or a self-indulgent pleasure cruise lining the pockets of the individuals close to the White House.

 

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