Paying Their Fair Share

Making “the rich” pay their “fair share” has been a talking point for some time and became a bit of a slogan during the presidential race. Drawing on the Congressional Budget Office’s most recent report, the Tax Foundation posts,

One of the main takeaways from this year’s report is that the richest Americans pay a lot in taxes. In 2013, the top 1 percent of households paid an average of 34.0 percent of their income in federal taxes. To compare, the middle 20 percent of households paid only 12.8 percent of their income in taxes.

Moreover, taxes on the rich are much higher than they’ve been in recent years. Between 2008 and 2012, the top 1 percent of households paid an average tax rate of 28.8 percent. However, in 2013, this figure spiked to 34.0 percent, as a result of tax increases in the “fiscal cliff” deal and the Affordable Care Act.

We’ve known for a while that taxes rose on the rich in 2013, but the new CBO report puts in perspective exactly how high taxes on the rich are now, compared to the last three decades. For instance, in 2013, the top 1 percent of taxpayers paid a higher tax rate (34.0 percent) than in the year President Reagan took office (33.2 percent).

According to the CBO, the federal tax system is now “the most progressive it has been since at least the mid-1990s.” Writing in The Atlantic, Derek Thompson notes that “the government is doing more to fight inequality right now than any year on record.”

Economist Mark Perry provides additional insights (as he has in the past) to the CBO report. For example,

  • The bottom three income quintiles are net recipient households, meaning they receive more in transfer payments than they pay in federal taxes. The top two could be designated as net payer households. The top income quintile in particular “finance[s] almost 100% of the transfer payments to the bottom 60%, as well as almost 100% of the tax revenue collected to run the federal government.”

  • The bottom three quintiles receive “more than $1 in government transfer payments for every $1 paid in federal taxes in 2013. The fourth quintile consists of minor net payer households, receiving “slightly less than a dollar in transfer payments on average ($0.85) for every $1 paid in federal taxes. In contrast, “net payer households” in the top income quintile received only $0.17 in government transfer payments per $1 paid in federal taxes in 2013.”

 

  • “Adjusting for government transfers received, the light blue bars in the chart are calculated by dividing “Federal taxes paid minus government transfers received” (row 6 in the table) into Before-Tax Income (row 3), and show average federal tax rates by income quintile after government transfers. For example, the average “net recipient household” in the lowest income quintile received a “negative tax” payment of $8,800 in 2013, had an average before-tax income of $25,400, for a negative federal tax rate of 35%…This further demonstrates that after transfer payments, Americans in the bottom 60% by income are “net recipient households” with negative federal income tax rates, while only households in the top two “net payer” income quintiles had positive federal income tax rates after transfers in 2013.”

Perry concludes,

The CBO study released [in June] provides ample evidence that the richest Americans are paying their “fair share” of federal taxes. In fact, the richest 20% of Americans by income aren’t just paying a share of federal taxes that would be considered “fair” – it goes way beyond “fair” – they’re shouldering almost 100% of the entire federal tax burden of transfer payments and all other non-financed government spending.

…It’s also important to note here that the US has the most progressive federal tax system among all OECD-24 countries, see Tax Foundation president Scott Hodge’s article “No Country Leans on Upper-Income Households as Much as the US.” Specifically, the top 10% of American households pay 45.1% of all income taxes (both personal income and payroll taxes combined), which is the highest tax share for that group in any of the OECD-24 countries and far above the 31.6% average for the tax burden of the top income decile. Accounting for the income share of the top income decile, the US also has the highest ratio of the income tax share of the top 10% (45.1%) to the total income share of that group (33.5%) of 1.35 times, compared to the OECD average ratio of only 1.11.[ref]You can see more commentary on the CBO report in Scott Winship’s Forbes article.[/ref]

Fatherhood: Unique Contributions to Child Health

Image result for dad roughhousing

The American Academy of Pediatrics released a new clinical report this past June detailing “the unique contributions of fathers to healthy child development” as well as “encourag[ing] pediatricians to make an extra effort to support and involve dads more. It is the first clinical report on fathers the AAP has released in over a decade, and it includes an extensive review of theemerging research on fatherhood.” Defining fathers rather broadly–including biological fathers, stepfathers, foster fathers, grandfathers–the report’s findings include:

  • Father’s playtime or “roughhouse play,” which “decreased externalizing and internalizing behavior problems and enhanced social competence” among preschoolers.
  • Communication style, which usually includes bigger words (compared to the common maternal style of speaking at the child’s level) Research finds that, “at 3 years of age, father-child communication was a significant and unique predictor of advanced language development in the child but mother-child communication was not.”
  • “The report cites the vast body of research that shows father-presence can reduce anti-social behaviors in boys, and is linked to a decrease in early puberty, depression, early sexual activity, and teen pregnancy in girls.”

In summary,

Ultimately, the AAP report concludes: “The message is clear: fathers do not parent like mothers, nor are they a replacement for mothers when they are not at home; they provide a unique, dynamic, and important contribution to their families and children.”

This long overdue message on the irreplaceable role of fathers is not only vital for child healthcare providers to understand and communicate, but also for parents, teachers, and policymakers who want to promote child wellbeing for every family. As the AAP report demonstrates through the large and growing body of research on fatherhood, dads matter as much as moms to children’s health, and they matter in unique ways. Hopefully, more pediatricians will work harder to educate both parents about this truth, and to encourage and facilitate father involvement during every stage of child development.

Healthcare Inequality

Image result for healthcare insuranceA June 2016 study from George Mason University’s Mercatus Center finds “that both scholars and politicians have largely overlooked a key contributor to earnings inequality: the role of rapidly increasing healthcare costs.” The study “analyzes the link between earnings inequality and rising healthcare costs using unpublished data from the Bureau of Labor Statistics. The study finds that the increasing cost of employer-provided healthcare benefits accounts for a significant portion of rising earnings inequality.[ref]It doesn’t help that premiums have been increasing under Obamacare.[/ref] The study urges policymakers interested in addressing earnings inequality to shift their focus from failed redistributive policies to policies aimed at lowering the cost of healthcare benefits.” The key findings:

  • Most previous analyses of inequality focused exclusively on earnings, ignoring total compensation (including healthcare benefits). This oversight significantly inflated the perceived severity of workers’ earnings inequality.
  • While dollar earnings have grown significantly faster for higher-income workers than for lower-income workers, total compensation (including increasingly expensive healthcare benefits) has not.
  • Surging healthcare costs have depressed the annual earnings growth rate for lower-paid, full-time workers four times as much as for the top 1 percent of workers.
  • Redistributive policies do not address the root cause of the apparently increasing inequality, and may be counterproductive because of their negative implications for overall economic growth.
  • The key to lessening earnings inequality is to reduce the rate of increase for healthcare costs.

Check it out.

Back to the Future

044-oct2016-gencon

This post is part of the General Conference Odyssey.

I titled this post “Back to the Future” because we’re taking a break from the historic portion of the GCO to cover the October 2016 General Conference that just wrapped up. One thing I’ve definitely learned this week is that I do better with reading than listening. There are several talks that, in preparing this post, I realized that I’m going to have to read as soon as they’re available because I didn’t get everything there was to get out of them. Also, in this post I’m going to be using quotation marks even in places where I might be paraphrasing a bit. The text isn’t online yet, so I hope you’ll forgive the lack of quote-checking. I’m just going off my notes.

So, first, I want to run through some of the quotes that I liked:

Saturday Morning Session

President Uchtdorf

“One day every knee will bow and every tongue will confess that the Plan of Salvation is merciful, just, and true. For us: let today be that day.”

Sister Carol F. McConkie

“We pray by the power of the Holy Ghost.” This means that all members of the Godhood are united in prayer: we pray to the Father, through the Holy Ghost, in the name of the Son.

Elder Juan A. Uceda

“When you pray, are you really praying? Or just saying your prayers?”

Elder J. Devin Cornish

“The answers to Am I good enough? And Will I make it? Are yes” as long as you don’t rationalize, rebel, or fail to repent.”

“Please take comfort from this truth: our Heavenly Father intends for us to make it.

Saturday Afternoon Session

Elder Kazuhiko Yamashita

“Be ambitious for Christ.”

Sunday Morning Session

President Russel M. Nelson

At first I didn’t like this talk because it seemed like a stretch to tell me that we could experience joy and suffering simultaneously. But Elder Nelson pressed the point home, saying that Christ focused on joy in order to endure the trials of the Atonement, and citing a friend who said, “I have learned to suffer with joy. My suffering was swallowed up in the joy of Christ.” Now the concepts are germinating in me, and I’m waiting to see what realizations eventually grow out of them.

Elder Dean M. Davies

“Spiritual experiences have less to do with what is happening around us, and everything to do with what is in our hearts.”

I loved this talk because it went to one of my favorite themes–the idea of finding the sacred and sublime in every day experiences–but I also cracked up when my wife commented that, “Some of us just hope for ordinary meetings, and not weird ones.” There’s truth to that, too!

Elder Lynn G. Robbins

“Unkind things are not usually spoken under the influence of the spirit.”

Sunday Afternoon

Elder Brian K. Ashton

Repentance is not a backup plan.

Elder K. Brett Nattress

“If all that your children knew of the Gospel is what they had learned from you, how much would they know?”

Elder Dale G. Renlund

“Repentance is not only possible, but also joyful because of our Savior. . . I invite you to feel more joy in your life. Joy in the knowledge that the atonement of Jesus Christ is real… and joy in choosing to repent.”

Now, there’s one more thing that I want to talk about. There were a ton of talks about questioning, doubt, and faith crises. Elder Craig C. Christensen said “Joseph Smith had questions, but luckily he did not let his questions overwhelm his faith.” Elder Basset said:

“The Church is making great efforts to be transparent. Even after that, the members are unsatisfied with some things that can’t be understood through study. That is because some things can only be understood through faith.”

Elder Ballard said:

“Before you make the spiritually perilous decision to leave, stop and think about what you have felt here and why you have felt it. Where will you to go find others who believe in personal, loving Heavenly Parents? . . . Where will you to go find people who live by the values you share?”

And he made this incredibly powerful statement that I’m sure will have echoes and reverberations in my mind for many, many years to come: “Jesus understand our infirmities, including the loss of faith.”

He also said:

“My heartfelt plea is that we will encourage, accept, and understand those who are struggling on the path. We need to minister to one another. Just as we should open our arms in a spirit of welcoming a new convert, so should we embrace and support those who have questions and are faltering in their faith.”

Elder Rasband was perhaps the most direct about it, stating at the outset that a friend’s faith crisis had led to his talk, and making memory his theme:

“Recall, especially in times of crisis, when you felt the Spirit and your testimony was strong. I promise that if you avoid things that do not build your testimony or that mock your beliefs, your testimony will come back. You will once again feel the safety and warmth of the gospel of Jesus Christ.”

He concluded: “Do not forget. Please, do not forget.”

But in some ways the most powerful of all these talks was the one given by Elder Quentin L. Cook, who talked about stumbling blocks, including “the philosophies of men.” What struck me most–and I only picked up on this as I want back through his talk–was that he cited President Heber C. Kimball from back in 1856:

We think we are secure here in the chambers of the everlasting hills, where we can close those few doors of the canyons against mobs and persecutors, the wicked and the vile, who have always beset us with violence and robbery, but I want to say to you, my brethren, the time is coming when we will be mixed up in these peaceful valleys to the extent that it will be difficult to tell the face of a Saint from the face of an enemy to the people of God. Then, brethren, look out for the great sieve, for there will be a great sifting time, and many will fall; for I say unto you there is a test, a TEST, a TEST coming, and who will be able to stand? This church has before it many close places through which it will have to pass before the work of God is crowned with victory.

This is a pretty apocalyptic-sounding prophecy, and so it’s no coincidence that Elder Cook specifically erected a barrier against overcorrection. It’s pretty clear, from his talk and from President Kimball’s quote, that the chief danger comes from what is popular and what is intellectually favored today. And so it is that Elder Cook says we should avoid people who put too much emphasis on particular aspects of the Word of Wisdom or spend extravagant amounts of time and money prepping for the end times. It seems pretty clear that Hollywood and the Ivory Tower are the source of greatest confusion, but that our response has to be to stand our ground, not overcorrect in the opposite direction.

When I looked up President Kimball’s quote, I found it’s been used in many places. (It was new to me, however.) One of those was a 1990 Ensign article by President Hinckley[ref]A City Upon A Hill[/ref] who–after citing just the last parts of the quote–wrote:

I do not know precisely the nature of that test. But I am inclined to think the time is here and that the test lies in our capacity to live the gospel rather than adopt the ways of the world.

President Hinckley also said, “I do not advocate a retreat from society.”

I am eager for transcripts of these talks to be released. I especially want to re-read all the talks in this section carefully.

Check out the other posts from the General Conference Odyssey this week and join our Facebook group to follow along!

The Evidence for Syringe Exchange Programs and Drug Decriminalization

Image result for syringe exchange programAn article in The New York Times last month highlights some important policies that could be more effective than our currently abysmal War on Drugs: syringe exchange programs. “Evidence abounds that they work,” writes economist Austin Frakt.

A study of the first American program–started in the Tacoma, Wash., area in 1988–found that use of the exchange was associated with a greater than 60 percent reduction in the risk of contracting hepatitis B or C. Another study of over 1,600 injection drug users in New York found that those who didn’t use a syringe exchange in the early 1990s were more than three times as likely to contract H.I.V.

It turns out these programs are also cheaper for taxpayers:

A cost-effectiveness analysis published in 2014 replicated the findings of others that came before it: A dollar invested in syringe exchange programs saves at least six dollars in avoided costs associated with H.I.V. alone. 

But don’t these programs promote drug use and crime? Well, “according to many studies, that isn’t so. Instead, they are associated with increased participation in treatment programs.” When taken with the evidence of the positive effects of Portugal’s drug decriminalization, it seems we have multiple reasons to give up the War on Drugs and the programs to erect in its stead.

What Happened?: Republicans on Trade

Image result for free trade

I’ve mentioned in passing the oddity of Democrats being more supportive of free trade than their supposedly capitalism-loving Republican opponents. A brand new poll by POLITICO and the Harvard T.H. Chan School of Public Health further confirms this shift. Some of the findings:

  • 47% of Republicans think free trade has hurt their communities, twice that of Democrats (24%). Only 18% of Republicans think free trade has helped, while nearly twice as many Democrats do (33%).
  • When broken down by country (Canada, EU, Japan, South Korea, Mexico, China) and by party, Republicans exceed both Democrats and Independents on every country in claiming that trade hurts. Over 60% of Republicans think trade with Mexico and China have hurt Americans. Democrats were surprisingly the lowest on every country.
  • “54% of Democrats believe that free trade has lost more U.S. jobs than it has created, compared to 66% of Independents and 85% of Republicans. Similarly, 38% of Democrats believe free trade has lowered U.S. wages, compared to 50% of Independents and 66% of Republicans. Only 8% of Republicans, 11% of Independents, and 19% of Democrats think free trade has led to higher wages for U.S. workers” (pg. 3).

There’s much more, including attitudes about the state of the economy and the Affordable Care Act. As one who grew up in a conservative household, I find this all rather worrying. As Trump’s senior policy adviser and economist Peter Navarro told POLITICO, “There’s been a schism for a long time between registered Republicans and the party leadership. That was the essence of the primary election. You had a group of insider politicians singing the same old globalization song. And one candidate saying the emperor has no clothes.” The problem, of course, is that the emperor is fullyclothed.

The Republican party has become a party of mercantilists.

Human Violence: High for Mammals, Average for Primates, Less Than Before

As reported in The Atlantic,

Which mammal is most likely to be murdered by its own kind? It’s certainly not humans—not even close. Nor is it a top predator like the grey wolf or lion, although those at least are #11 and #9 in the league table of murdery mammals. No, according to a study led by José María Gómez from the University of Granada, the top spot goes to… the meerkat. These endearing black-masked creatures might be famous for their cooperative ways, but they kill each other at a rate that makes man’s inhumanity to man look meek. Almost one in five meerkats, mostly youngsters, lose their lives at the paws and jaws of their peers.

Gómez’s study is the first thorough survey of violence in the mammal world, collating data on more than a thousand species. It clearly shows that we humans are not alone in our capacity to kill each other. Our closest relatives, the chimpanzees, have been known to wage brutal war, but even apparently peaceful creatures take each other’s lives. When ranked according to their rates of lethal violence, ground squirrels, wild horses, gazelle, and deer all feature in the top 50. So do long-tailed chinchillas, which kill each other more frequently than tigers and bears do.

The article continues:

The point of this macabre census was to understand the origins of our own behavior. Gómez typically studies plants and insects, but he realized that the techniques he uses to study their evolution can be used to study our own. In particular, he noted that closely related species tend to show similar levels of lethal interpersonal violence. He could use those similarities to predict how violent any given mammal should be, and whether it meets, exceeds, or defies those expectations.

It turns out that humans “were six times more lethally violent than the average mammal, but about as violent as expected for a primate. But time and social organizations have sated our ancestral bloodthirst, leaving us with modern rates of lethal violence that are well below the prehistoric baseline. We are an average member of an especially violent group of mammals, and we’ve managed to curb our ancestry.”

By how much though? After “poring through statistical yearbooks, archaeological sites, and more,” the researchers were able “to work out causes of death in 600 human populations between 50,000 BC to the present day. They concluded that rates of lethal violence originally ranged from 3.4 to 3.9 percent during Paleolithic times, making us only slightly more violent than you’d expect for a primate of our evolutionary past. That rate rose to around 12 percent during the bloody Medieval period, before falling again over the last few centuries to levels even lower than our prehistoric past.”

The reason? Organization.

[O]nce we formed large states, “institutions like the rule of law reduced rates of lethal violence below what one would expect for a mammal with our ancestry and ecology, and below what has been observed in human societies in earlier periods and with simpler forms of social organization,” says Steven Pinker from Harvard University. He argued as much in his book The Better Angels of Our Nature, but says that Gómez’s team have done so “with greater precision, rigor, and depth; I wish this study had been available when I wrote the book.”

The Drucker Lectures: Short Film of Peter Drucker

This is part of the DR Book Collection.

Image result for the drucker lecturesThe late Peter Drucker (1909-2005) is one of the most influential management thinkers of all time as well as “the most cited management writer in the textbooks, exceeding that of Abraham Maslow, Max Weber, and Frank and Lillian Gilbreth…”[ref]Patricia G. McLaren, Albert J. Mills, Gabrielle Durepos, “Disseminating Drucker: Knowledge, Tropes and the North American Management Textbook,” Journal of Management History 15:4 (2009): 391.[/ref] His influence has been felt worldwide, particularly in Japan during the post-war boom.[ref]See also Chuck Ueno, “Peter Drucker’s Influence in Japan,” People and Strategy 32:4 (2009): 8-9. While the Clarke Professor of Social Sciences and Management at Claremont Graduate School, Drucker also lectured in Oriental Art at Pomona College and was appointed to the Board of the Asian Art Museum in San Francisco.[/ref] His outlook on management was that of a liberal art—“‘liberal’ because it deals with the fundamentals of knowledge, self-knowledge, wisdom, and leadership; ‘art’ because it is also concerned with practice and application.”[ref]Peter F. Drucker, The Essential Drucker (New York: HarperCollins, 2001), 13.[/ref] When Drucker was asked why he was turning his attention from corporate management to churches in his later years, he politely corrected them: “As far as I’m concerned, it’s the other way around. I became interested in management because of my interest in religion and institutions.” Drucker’s views on management, corporations, and the like were heavily influenced by his reading of Soren Kierkegaard. “Key to Kierkegaard’s philosophy (and to Drucker’s understanding of it) is the emphasis that Kierkegaard placed on living in the material realm.”[ref]Karen E. Linkletter, Joseph A. Maciariello, “Genealogy of a Social Ecologist,” Journal of Management History 15:4 (2009): 338.[/ref] Drucker’s search for existential purpose within the material realm of organizations can also be traced to his German intellectual and cultural background. Some researchers have viewed him as “a secularized German theologian” bucking against “‘the fall’ of modernity…”[ref]Madeline Toubiana, Gad Yair, “The Salvation of Meaning in Peter Drucker’s Oeuvre,” Journal of Management History 18:2 (2012): 179.[/ref] For many German scholars, “modernity meant an abandonment of tradition, coupled with a loss of meaning and faith…”[ref]Toubiana, Yair, 2012: 182.[/ref] Thus, Drucker believed that organizations and managers had “secularized theological duties; …moral duties in a world devoid of meaning[.]”[ref]Toubiana, Yair, 2012: 179.[/ref] In essence, work within an organization became a kind of worship; a way to tap into a higher purpose. As Drucker summarized,

Management always lives, works, and practices in and for an institution, which is a human community held together by the bond that, next to the tie of family, is the most powerful human bond: the work bond. And precisely because the object of management is a human community held together by the work bond for a common purpose, management always deals with the Nature of Man, and…with Good and Evil as well. I have learned more theology as a practicing management consultant than I did when I taught religion.[ref]Quoted in Linkletter, Maciariello, 2009: 339.[/ref]

It is because of insights like these that I recently read through The Drucker Lectures: Essential Lessons on Management, Society, and EconomyThe book is not a series of formalized essays or selections from published works, but delivered lectures and remarks spanning from the 1940s to 2003 (Drucker passed away in 2005). You get a sense of the consistent themes of his work, even as his philosophy evolved.

You can catch of glimpse of this in the short film below.

Who Benefits From Trade?

A new study published last month in The Quarterly Journal of Economics attempts to answer that question. Their results?:

We find a pro-poor bias of trade in every country. On average, the real income loss from closing off trade is 63% at the 10th percentile of the income distribution and 28% for the 90th percentile. This bias in the gains from trade toward poor consumers hinges on the fact that these consumers spend relatively more on sectors that are more traded, whereas high-income individuals consume relatively more services, which are among the least traded sectors. Additionally, low-income consumers happen to concentrate spending on sectors with a lower elasticity of substitution across source countries. Larger expenditures in more tradeable sectors and a lower rate of substitution between imports and domestic goods lead to larger gains from trade for the poor than the rich (pgs. 1116-1117).

From the authors’ Vox article.

Previous studies have found net benefits to average Americans. For example, according to a 2005 study,

Estimated annual gains are on the order of $1 trillion. The estimated gain in 2003 income is in the range of $2,800 to $5,000 additional income for the average person and between $7,100 and $12,900 for the average household. Future gains are harder to quantify, not surprisingly since the future is always difficult to predict. The estimates range from $450 billion to $1.3 trillion (pg. 68).

While some recent studies (such as Autor et al. 2016) have looked at the job loss caused by trade, some economists have expressed skepticism and even confusion over the claims and models used. An article in the NBER Reporter earlier this year summarizes the debate:

The rise in exports from China has been one of the most significant events in international trade in recent decades. This trend has accelerated since that country’s entry into the World Trade Organization (WTO) in 2001. Even before that date, by a vote of the U.S. Congress China received the low-tariff, most-favored-nation status associated with WTO membership each year. But with WTO membership, Chinese firms experienced a reduction in the uncertainty associated with the outcome of that vote. This contributed importantly to the surge in exports to the United States, according to studies by Justin Pierce and Peter Schott and by Kyle Handley and Nuno Limão; their hypothesis is supported by empirical work by Ling Feng, Zhiyuan Li, and Deborah Swenson. Pierce and Schott observe that the surge in Chinese exports to the United States coincides with a substantial decline in U.S. manufacturing employment. Handley and Limão find that the welfare gain for consumers due to this increase in Chinese imports is of the same order of magnitude as the U.S. gain from new imports in the preceding decade. These initial findings highlight the dual role that Chinese imports play for the United States: on the one hand, they create import competition with associated labor-market dislocation; on the other, they benefit U.S. consumers.

The first of these roles is explored in a series of papers by David Autor, David Dorn, and Gordon Hanson. They analyze the impact of Chinese import competition between 1990 and 2007 on local U.S. labor markets, exploiting geographic differences in import exposure that are due to initial differences in industry specialization. Higher exposure increases unemployment, lowers labor force participation, and reduces wages…At the aggregate level, a conservative estimate is that the import surge accounts for one-quarter of the decline in U.S. manufacturing employment. The regional concentration in the decline in manufacturing employment is inconsistent with some alternative explanations of this phenomenon, notably the possibility of a systemic technology shock. The trade effects on unemployment are confirmed by examining worker-level evidence. Most recently, in joint work with Daron Acemoglu and Brendan Price, these authors find that the import surge from China also contributed to unusually slow employment growth in the United States following the global financial crisis and the Great Recession.

While these papers have explored the impact of import competition from China, they do not incorporate the consumer gains or the export opportunities created by expanded Chinese exports. The first attempt to put the surge in Chinese exports into a general equilibrium context is that of Lorenzo Caliendo, Maximiliano Dvorkin, and Fernando Parro. Their computable general equilibrium model incorporates labor mobility frictions and dislocation costs. They find that growing Chinese import competition resulted in a 0.6 percentage point reduction in manufacturing’s share of total employment, or approximately one million jobs lost, which is about 60 percent of the change in manufacturing employment not explained by a secular trend. At the same time, the China shock increased U.S. welfare by 0.2 percent in the short run and 6.7 percent in the long run, with very heterogeneous effects across labor markets. Despite the fact that employment impacts and labor market dislocation are much stronger in some areas, the consumer gains and export opportunities mean that nearly all regions experience net benefits from rising Chinese imports.

While there may be certain steps we can take to diminish the temporary blow to some American workers, we should not lose sight of the fact that trade is a net benefit to Americans and particularly the poor.

Racial Bias & Policing: A Rundown of the Data

With protests in Charlotte and the shooter of Terence Crutcher in Tulsa being charged with manslaughter, the question of systemic racism and #BlackLivesMatter has risen again. The following is meant to be a helpful list of relevant data regarding the current state of police force and racial bias:

  • The Rarity of Force: According to the U.S. Department of Justice, it is “[k]nown with substantial confidence…that police use force infrequently. The data indicate that a small percentage of police-public encounters involve force. For example, about 1 percent of people who had face-to-face contacts with police said that officers used or threatened force, according to preliminary estimates based on the Bureau of Justice Statistics’ 1996 pretest of its Police-Public Contact Survey…In 7,512 adult custody arrests, another study…notes that fewer than one out of five arrests involved police use of physical force (defined as use of any weapon, use of any weaponless tactic, or use of severe restraints). That can be considered a low rate in view of the study’s broad definition of force” (pg. vii). By highlighting this first, “the intention is neither to minimize the problem nor to suggest that the issue can be dismissed as unworthy of serious attention. Society’s ends are best achieved peaceably, and we should strive to minimize the use of force by police as much as possible. However, it is important to put police use of force in context in order to understand the potential magnitude of use-of-force problems. Although estimates may not completely reassure everyone that police are doing everything they can to minimize the use of force, the data do not support the notion that we have a national epidemic of police violence” (pg. 3). In summary, the vast majority of civilian/police interactions involve no violence whatsoever.
  • Increase in Police Shootings: However, the above study was done in 1999. Both private and federal data since then suggest that the use of lethal force by police is increasing (see the graph below). Nonetheless, even with upticks in killings by police, the use of lethal force would still be exceedingly rare.

  • Lack of Prosecution: Very few officers have been prosecuted for fatal shootings since 2005 according to a 2015 analysis by The Washington Post. This could very well be for good reasons, but the point is that it is rare for an officer to face prosecution.
  • Police Officers Are Safer: Murders, assaults, and shootings of police officers have thankfully declined over the last few decades (for example, see the graph on assaults and injuries below). We should want to keep it that way.

  • Unreliable Data: Unfortunately, the data on use of force by police aren’t very helpful. Reporting on a 2013 survey conducted by the Justice Department, The New York Times stated, “But when the data was issued…the figures turned out to be almost useless. Nearly all departments said they kept track of their shootings, but in accounting for all uses of force, the figures varied widely. Some cities included episodes in which officers punched suspects or threw them to the ground. Others did not. Some counted the use of less lethal weapons, such as beanbag guns. Others did not. And many departments, including large ones such as those in New York, Houston, Baltimore and Detroit, either said they did not know how many times their officers had used force or simply refused to say. That made any meaningful analysis of the data impossible.” USA Today found similar problems. For example, University of Nebraska criminologist Samuel Walker said that the uptick in police shootings could simply be due to more departments reporting. The Washington Post‘s Radley Balko summarizes, “The point is, it’s nearly impossible to know all the details behind all of these shootings. We have to rely on reports filed by the officers themselves. We know more details about these particular cases because an attorney or a journalist took the time to investigate, file open records requests, and look beyond the police reports and press accounts (which, less face it, too often are too reliant on the police reports).”
  • Individual Racism: Rhetoric from critics of police sometimes gives the impression that police shootings of blacks stem from individual racism. According to a 2015 survey, 12.2% of all U.S. local police officers are black. Interestingly enough, one study found that black officers are 3.3 times more likely to discharge their weapon than white officers on the scene of the same incident. A 2015 study of the Philadelphia Police Department by the U.S. Justice Department found that black officers had a threat perception failure (TPF)[ref]”TPFs are what the law enforcement community commonly refers to as “mistake of fact” shootings. They occur when an officer perceives that a suspect is armed due to the misidentification of a nonthreatening object (e.g., a cell phone) or movement (e.g., tugging at the waistband)” (pg. 30).[/ref] rate of 11.4% with black suspects, while white officers’ TPF rate was only 6.8% with black suspects (see pg. 32). A Washington State University study found that “[p]articipants were…more likely to shoot unarmed white suspects than black or Hispanic ones and more likely to fail to fire at armed black suspects. “In other words,” wrote [Lois] James and her co-authors, “there was significant bias favoring blacks where decisions to shoot were concerned.” When confronted by an armed white person, participants took an average of 1.37 seconds to fire back. Confronted by an armed black person, they took 1.61 seconds to fire and were less likely to fire in error. The 240-millisecond difference may seem small, but it’s enough to be fatal in a shooting.” The reason may be “rooted in people’s concerns about the social and legal consequences of shooting a member of a historically oppressed racial or ethnic group.” The case for individual racism in a general sense is hard to make.
  • Systemic Racism: However, criticism from groups like Black Lives Matter and others are not so much focused on individual racism as they are on systemic racism. The claim is not that cops are individually racist (“some of those that work forces are the same that burn crosses“), but that the system in which they operate is biased against vulnerable black communities. For example, The New Jim Crow: Mass Incarceration in the Age of Colorblindness by Ohio State University law professor Michelle Alexander details how the War on Drugs disparately impacts black and poor communities more than white and prosperous ones. Blacks are far more likely to be charged with and convicted of drug crimes, yet blacks use drugs at roughly the same rates as whites while being less likely to sell. While this doesn’t address violent crimes–of which blacks commit a disproportionate amount–it’s worth noting that drug crimes “have been the predominant reason for new admissions into state and federal prisons in recent decades.” Nathaniel has an excellent review here, which covers the book’s claims regarding racially-disparate stops, arrests, convictions, and consequences that come with the scarlet-F of a felony conviction.
  • Black-on-Black Crime: This is a largely irrelevant talking point. According to the U.S. Department of Justice, 93% of black murder victims were killed by other blacks between 1980 and 2008. Similarly, 84% of white murder victims were killed by other whites (pg. 13; see graph below). In other words, most violent crime is intraracial. Furthermore, the Bureau of Justice Statistics found that–between 2008 and 2012–those “in poor households at or below the Federal Poverty Level (FPL) (39.8 per 1,000) had more than double the rate of violent victimization as persons in high-income households (16.9 per 1,000).” It turns out that “[p]oor urban blacks (51.3 per 1,000) had rates of violence similar to poor urban whites (56.4 per 1,000).” Between 2007 and 2011, the black poverty rate was 25.8 percent, while the white poverty rate was 11.6 percent. In short, poor whites and blacks commit violent crimes at about the same rate. There are just more poor blacks than poor whites. And considering that there is strong empirical support for poverty as a predictor of crime, lifting communities out of poverty may be one of the best crime prevention programs.

Image result for Homicides, by race of offender and victim, 1980–2008

  • Stops, Searches, Arrests: Numerous studies find that blacks are stopped and searched at far higher rates than whites. A July 2016 report on police practices in San Francisco found that statistics “suggest there are racial disparities regarding SFPD stops, searches, and arrests, particularly for Black people.” Black adults were 7 times more likely to be arrested than whites along with having higher rates of searches without consent after stops and lower hit rates (i.e., rate at which searches turn up contraband). The Justice Department’s 2015 investigation into Ferguson police behavior found that “African Americans are more than twice as likely as white drivers to be searched during vehicle stops even after controlling for non-race based variables such as the reason the vehicle stop was initiated, but are found in possession of contraband 26% less often than white drivers, suggesting officers are impermissibly considering race as a factor when determining whether to search” (pg. 4).[ref]See Radley Balko’s incredible article on the predatory practices of St. Louis’ municipalities for more.[/ref] A 2016 study of Chicago PD found that “black and Hispanic drivers were searched approximately four times as often as white drivers, yet CPD’s own data show that contraband was found on white drivers twice as often as black and Hispanic drivers” (pg. 9). A 2014 ACLU analysis of Illinois Department of Transportation data found that “African American and Latino drivers are nearly twice as likely as white drivers to be asked during a routine traffic stop for ‘consent’ to have their car searched. Yet white motorists are 49% more likely than African American motorists to have contraband discovered during a consent search by law enforcement, and 56% more likely when compared to Latinos.” A New York Times analysis found that officers in Greensboro, N.C. were “were more likely to stop black drivers for no discernible reason. And they were more likely to use force if the driver was black, even when they did not encounter physical resistance.” A 2016 Justice Department investigation of Baltimore PD found that “BPD engages in a pattern or practice of making stops, searches, and arrests in violation of the Fourth and Fourteenth Amendments and Section 14141. BPD frequently makes investigative stops without reasonable suspicion of people who are lawfully present on Baltimore streets. During stops, officers commonly conduct weapons frisks—or more invasive searches— despite lacking reasonable suspicion that the subject of the search is armed. These practices escalate street encounters and contribute to officers making arrests without probable cause, 36 often for discretionary misdemeanor offenses like disorderly conduct, resisting arrest, loitering, trespassing, and failure to obey” (pg. 24). It also found that “BPD disproportionately stops African Americans standing, walking, or driving on Baltimore streets. The Department’s data on all pedestrian stops from January 2010 to June 2015 shows that African Americans account for 84 percent of stops55 despite comprising only 63 percent of the City’s population. Expressed differently, BPD officers made 520 stops for every 1,000 black residents in Baltimore, but only 180 stops for every 1,000 Caucasian residents. The high rate of stopping African Americans persists across the City, even in districts where African Americans make up a small share of the population. Indeed, the proportion of African-American stops exceeds the share of African-American population in each of BPD’s nine police districts, despite significant variation in the districts’ racial, socioeconomic, and geographic composition” (pg. 48-49). This was true for traffic stops as well: “BPD likewise stops African-American drivers at disproportionate rates. From 2010–2015, African Americans made up 82 percent of people stopped by BPD officers for traffic violations, compared to only 60 percent of the City’s driving age population. As with pedestrian stops, BPD stopped a higher rate of African American drivers in each of the City’s districts, despite large differences in those districts’ demographic profiles and traffic patterns. For example, African Americans accounted for 80 percent of vehicle stops in the Northern District despite making up only 41 percent of the district’s population, and made up 56 percent of stops in the Southeast District compared to only 23 percent of the population living there” (pg. 52). And yet, BPD hit rate data “suggests that officers’ search decisions are biased against African Americans. Indeed, BPD’s data on all stops from 2010–2015 shows that searches of African Americans have significantly lower hit rates than other searches. During vehicle stops, BPD officers reported finding some type of contraband less than half as often when searching African Americans—in only 3.9 percent of searches of African Americans, compared to 8.5 percent of other searches” (pg. 53). A 2011 Justice Department report found, in 2008, that whites, blacks, and Hispanics were stopped at about the same rate, yet blacks were searched about 3 times more than whites (pg. 10). A 2016 study of North Carolina’s database found “that black drivers (men and women) are 75% more likely to be searched than whites, 5% less likely to be ticketed, and 43% more likely to be arrested…In 2002, black men were 70% more likely to be searched than whites and this disparity has grown steadily over the period of study. Beginning in 2007, black men were twice as likely to be searched and by 2013 this difference had grown to over 140%. Black men are also more likely to be arrested; however, this disparity has remained stable at about a 60% increased likelihood. We also see that black men are marginally less likely to receive citations and there is almost no variance; NC police are highly consistent over time in their relative treatment of whites and black men when it comes to ticketing…Compared to white men, black men are more likely to be searched and arrested for every type of stop, with the exception of driving while impaired” (pg. 10). According to the database, “[i]n 2002, officers were almost 125% more likely to search black men than white men using a probable cause search. By 2013, officers were almost 250% more likely to use probable cause as a justification for searching blacks – essentially doubling the disparity in the use of probable cause searches. Tracking the contraband hit rate associated with this type of search reveals that officers’ suspicions of wrongdoing have always been less accurate when engaging with black motorists; officers consistently find contraband on black males at modestly lower rates than white males. So the increased reliance on probable cause to search blacks is not associated with more accurate assessments of the likelihood of blacks engaging in criminal behavior. And the increased racial disparities in probable cause searches over time appear to be unjustified in terms of any increased likelihood of finding contraband” (pg. 13).
  • Driving Patterns and Traffic Violations: Are there alternative reasons for these stops besides racial bias and is there any evidence for them? The National Institute of Justice finds three potential reasons that blacks are pulled over at higher rates based on various studies: (1) “The representation of minority drivers among those stopped could differ greatly from their representation in the residential census. Naturally those driving on the road, particularly major thoroughfares, could differ from those who live in the neighborhood”; (2) “If minority drivers tend to drive in communities where there are more police patrols then the police will be more likely to notice any infractions the black drivers commit”; (3) Seatbelt usage is chronically lower among black drivers. If a law enforcement agency aggressively enforces seatbelt violations, police will stop more black drivers.” As a Washington Post article concludes, “Ethics aside, this is where the research leaves us: Black drivers certainly get more face-time with traffic cops. But to what extent that reflects discrimination, and whether that discrimination is based in racial prejudice, is more of an open question.”
  • Unarmed Shootings: A 2015 study found “the median probability across counties of being {black, unarmed, and shot by police} is 3.49 (PCI95: 1.77, 6.04) times the probability of being {white, unarmed, and shot by police}.” However, some are hesitant to declare racial bias due to the amount of violent crimes in black communities. Blacks are more likely to be stopped and therefore more likely to end up in a violent conflict with police due to heavier policing of these crime-ridden areas. Yet, the evidence seems to be against this line of reasoning. The study found “no evidence of an association between black-specific crime rates (neither in assault-related arrests nor in weapons-related arrests) and racial bias in police shootings, irrespective of whether or not other controls were included in the model. As such, the results of this study provide no empirical support for the idea that racial bias in police shootings (in the time period, 2011–2014, described in this study) is driven by race-specific crime rates (at least as measured by the proxies of assault- and weapons-related arrest rates in 2012).” Similarly, another 2015 analysis found that the levels of violent crime in US cities had no correlation with that area’s police killing rates. However, just because one is unarmed does not make one a non-threat or the intended target. Some unarmed shooting victims attempt to wrestle the officer’s gun away from them, while others are unfortunate and unintended collateral damage (e.g., caught in crossfire). How threatening blacks are–armed or unarmed–is one variable controlled for in a new study analyzing The Washington Post‘s 2015 database. The study “used multivariate regression models to determine whether the findings were attributable to race or another factor and found that, among the 990 civilians fatally shot[ref]It must be noted that non-fatal shootings were excluded from the analysis.[/ref] by the police last year, black civilians were more than twice as likely as white civilians to have been unarmed. This was true after controlling for threat level, the age and gender of the civilian, signs of mental illness, region of the United States, crime rate according to 2012 UCR data, size of the agency involved, and whether or not the agency operates its own basic training academy. In fact, the only other variable that was significant was, not surprisingly, threat level (meaning civilians in the “attack” category were far less likely to have been unarmed). In regards to the relationship between race and threat level, the data indicate that black civilians were not significantly more or less likely to have been attacking the police officer(s) or others than white civilians. However, Hispanic or Latino civilians and civilians from other minority groups were much less likely to have been attacking the police officers or others than white civilians. Again, these results held up after controlling for the influence of each of the other variables” (italics mine). However, it is paramount to note that the study found that the “majority of civilians shot and killed by the police in 2015 were male (96 percent), armed with a deadly weapon (82 percent), and attacking police officers or others (74 percent). Half of the civilians were white (50 percent). About one out of every four civilians fatally shot by police displayed signs of mental illness.” While bias in shootings is an extremely important issue and should be investigated, it is absolutely essential to remember that the majority of police shootings are due to legitimate threats. These are the kinds of incidents that provoke the #BlueLivesMatter counter. It is also worth acknowledging Harvard economist Roland Fryer’s recent study, which found no racial bias in police shootings across 10 major police departments in Texas, California, and Florida (check out The New York Times write-up and follow-up). However, there have been significant criticisms of Fryer’s study.
  • Non-Lethal Force: Yet, Fryer’s study also found that officers were far more likely to use non-lethal force on blacks than whites, including hands on civilians (e.g., slapping or grabbing), pushing into a wall, use of handcuffs, drawing weapons, pushing to the ground, pointing weapon, pepper spraying, and striking with a baton (see graph below). A July 2016 study found that the mean rate of use-of-force incidents “for Black residents was 273 per 100,000, which is 2.5 times as high as the overall rate and 3.6 times as high as the rate for White residents (76 per 100,000)” (pg. 15). It also concluded “that crime rates are an insufficient explanation for disparities in the application of police force” (pg. 18).

This material doesn’t even get into post-arrest injustices like harsher sentences for blacks or historical issues like redlining, but I think this list is a good starter. As you wade into the controversies and debates, try to be as accurate as possible. Know the numbers. Be rigorous. Be willing to admit it when the evidence doesn’t favor “your side.” Most of all, be charitable towards one another. These are people’s lives, both black and blue. We want a system that is just and serves all members of society fairly. And we want officers coming home safely to their families at the end of the day.

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