A Housing Bubble in China: A Rationale for Government Intervention

As of October, 2016, China was in the midst of a dizzying housing bubble. A month before, “economists at the Bank of China warned in a report that worsening asset price bubbles were adding to a frothy market that could result in trouble.”[1]  Shanghai’s average housing price was up nearly one-third from a year before; prices in major cities like Beijing and Guangzhou were not far behind.  The recognition of the bubble—which does not come easily—should have triggered counter-cyclical measures by the Chinese government.

The full essay is at "A Housing Bubble in China."

1. Neil Gough and Carolyn Zhang, “In China, Property Frenzy, Fake Divorces and a Bloating Bubble,” The New York Times, October 16, 2016.

U.S. Government adds $587 Billion to Its Debt in 2016: Revealing a Fault-line in Democracy

The U.S. federal-budget deficit for the fiscal year that ended at the end of September, 2016, represented a reversal on the six-year run of declining deficits. The $587 billion deficit is equivalent to 3.2% of GNP; the previous year’s deficit had been $438 billion, which is 2.5 percent of the GNP.[1] The underlying reason for the altered trend has to do with democracy itself—something notoriously difficult to budge.

The full essay is at "U.S. Budget Deficit of $587 Billion."

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1. Jackie Calmes, “U.S. Deficit Increases to $587 Billion, Ending Downward Trend,” The New York Times, October 14, 2016.

Christian Leadership in Pope Francis’s Naming of Cardinals

In naming 17 new cardinals in October, 2016, Pope Francis moved closer to putting his stamp on the sort of cleric who would follow him as pontiff. Similar to a U.S. president’s power to nominate justices to the U.S. Supreme Court, a pope’s power to appoint cardinals who presumably can vote in the next concave is decisive in terms of leaving a legacy. With the additional cardinals, Francis had appointed 40 percent of the cardinals who could vote in the next conclave. The fact that cardinals tend to be old suggests, however, that any lasting legacy would not be long lasting. I submit that the cardinals’ typical age and even other qualities suggest that the rubric a pope uses in selecting clerics for the red hat says a lot about how the pope approaches Christianity. 

The full essay is at "Christian Leadership."

E.U. Free-Trade After Brexit: Applying Domestic Requirements to International Trade

With the E.U. state of Britain set to secede from the Union, one major question was whether British businesses would continue to get unfettered access to the E.U.’s domestic market. I submit that subjecting free-trade negotiations to stipulations that are oriented to states rather than trading partners is unfair to Britain. Given the extraordinary influence of E.U. state officials at the federal level, this is a case in which the political influence of British business would be constructive rather than subversive of the public domain to private interests.

The full essay is at "Essays on the E.U. Political Economy," available at Amazon.

The E.U.’s Border-Control and Coast Guard: Held Hostage by Confederalism

In policing its borders as late as 2016, the E.U. suffered the same plight as the U.S. did under its Articles of Confederation—only whereas in the case of the U.S. the States retained all of their governmental sovereignty under the Articles, some governmental sovereignty in the E.U. was already lodged at the federal level. I contend that this perplexing disjunction between extant federal competencies and state rights in the E.U. is not sustainable.

The full essay is at "E.U.'s Border-Control."

Political Ideology in the U.S. Supreme Court: Undercutting the Court’s Legitimacy

As the U.S. Supreme Court began its 2016 term with eight justices, the Court stood “at the threshold of an ideological transformation unmatched in nearly a half century.”[1] Not since 1968, when Richard Nixon was elected U.S. President, had such an opportunity presented itself. Nixon’s four nominations ended the liberal majority begun by Franklin Roosevelt’s eight.[2] The conservative majority begun with Nixon’s nominations was up for grabs with the 2016 presidential election. I submit that the legitimacy of the ideological dimension itself dwarfs the matter of which ideology is dominant on the Court.

The full essay is at "Political Ideology in the U.S. Supreme Court."

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[1] Richard Wolf, “Court at Brink of Transformation,” USA Today, September 30 – October 2, 2016.

[2] Ibid.

E.U. Defense Post-Britain: Beyond Multinational Military Cooperation

Just months after the British voted to secede from the Union, the E.U.’s Counsel of Ministers discussed “proposals for increased military cooperation” amid concerns from the British state government as well as those of some eastern States that “such collaboration could undermine” NATO.[1] The proposals being discussed were “part of a push by European officials and diplomats to strengthen European ties” after Britain’s vote to secede.[2] I submit that both the expression, “military cooperation,” and Britain’s involvement in the discussion are ill-fitting and inappropriate, respectively.

The complete essay is at Essays on Two Federal Empires.

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1. Julian E. Barnes, “EU Pushes for Deeper Defense Cooperation,” The Wall Street Journal, September 28, 2016.

2. Ibid.

Americans Can Sue Saudi Arabia over 9/11 and the Saudis Accept Lower Oil Production by OPEC: The Unraveling of a Deal?

On Wednesday, September 28, 2016, the U.S. Congress voted overwhelmingly—97-1 in the Senate and 348-77 in the House of Representatives—to override President Obama’s veto of a bill that allows the families of the September 11, 2001 World Trade Center bombings.[1] As a result, American courts can seize Saudi assets to pay for any judgment obtained by the families. Saudi officials in turn warned that their government might need to sell off hundreds of billions of dollars in holdings in the United States to avoid such an outcome. In another place in the world, Saudi officials were dropping their resistance to OPEC—an oil cartel—cutting production. Even though positive correlation does not in itself indicate causation, the timing may point to the impact of political calculations by Obama. That is to say, the timing may suggest a political deal gone bad.

The full essay is at "Unraveling of a Deal?"

1. Jennifer Steinhauer, Mark Mazzetti, and Julie H. Davis, ,“Congress Allows Saudis to Be Sued Over 9/11 Attacks,“ The New York Times, September 29, 2016.

A Comet’s Cosmic Song: Evidence of Plato’s Justice as Harmony of the Spheres?

On September 30, 2016, the European Space Agency’s Rosetta spacecraft ended its mission orbiting Comet 67P. The mission added knowledge on how planets came together and how life arrived on Earth. “One of Rosetta’s key findings is that comets are probably not the source of Earth’s water.”[1] I submit that of even greater importance is a finding that can be indexed as philosophical in nature.

The full essay is at "A Comet's Cosmic Song."

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[1] Kenneth Chang, “Rosetta Mission Ends With Spacecraft’s Dive Into Comet,” The New York Times, September 30, 2016.

Fraud in Selling Sub-Prime Mortgage-Based Bonds: Beyond Accountability

“In December 2011, the S.E.C. publicized its civil securities fraud charges against top executives from Fannie Mae and Freddie Mac for understating their exposure to subprime mortgages, which resulted in the government taking them over.”[1] Robert Khuzami, then the head of the S.E.C.’s enforcement division, said at the time that “all individuals, regardless of their rank or position, will be held accountable for perpetuating half-truths or misrepresentations about matters materially important to the interest of our country’s investors.”[2] Pursuing even senior ranks has the air of fairness economically as well as in terms of the dictum, no one is above the law. So much for words; how about the accompanying deeds?

The full essay is at "Fraud in Selling Sub-Prime Bonds."

1. Peter Henning, “Prosecution of Financial Crisis Fraud Ends With a Whimper,” The New York Times, August 29, 2016.

2. Ibid.

Facebook’s Zuckerberg Donates $3 billion to Medical Science: Some Major Implications

Facebook’s CEO, Mark Zuckerberg, and his wife, Priscilla Chan, announced in September, 2016, that they would invest more than $3 billion during the next decade to build tools that can facilitate medical research on diseases. The first outlay of funds ($600 million) would create a research lab of engineers and scientists from the area’s major research universities.[1] “This focus on building on tools suggests a road map for how we might go about curing, preventing and managing all diseases this century,” Zuckerberg said at the announcement.[2] Moreover, the couple had previously announced a year before that they would give away 99% of their wealth over their lifetimes through the Chan-Zuckerberg Initiative in the areas of education and healthcare. I would like to point out a few implications that may not be readily apparent.

The full essay is at "Zuckerberg Donates $3 Billion."

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1. Deepa Seetharaman, “Zuckerberg Fund to Invest #3 Billion,” The Wall Street Journal, September 22, 2016.

2. Ibid.

As the World Turns: A Troublesome Widening Gap Between Progressives and Traditionalists

In his last speech to the U.N.’s General Assembly in September, 2016, U.S. President Barak Obama pointed to a world more prosperous yet with political and security crises.[1] He called this combination a paradox arising from globalization—the converging of political, economic, and social systems around the world made possible by advances in technology. I contend that globalization is not the primary cause of the massive changes going on in some societies but not others (and in parts of a given society), hence Obama’s diagnosis and prescription fall short. In short, parts of some societies, and some societies as a whole were going through massive, deep changes that were reinforcing the tendency of traditional forces to resist and stay put. It is the widening of the gap, both within some societies and between them that is the real cause of the strife.

The full essay is at "A Troublesome Widening."

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1. Carol E. Lee, “Obama Urges Course Shift for World in Conflict,” The Wall Street Journal,” September 21, 2016.

Russian Electoral Fraud: A Threat to Constitutional Governance

In spite of Ella Pamfilova’s appointment in March, 2016 to “clean house and oversee transparent, democratic elections,” . . . “a statistical analysis of the official preliminary results of the country’s September 18 [2016] State Duma elections points to a familiar story: massive fraud in favor of the ruling United Russia party.”[1] “The results of the current Duma elections were falsified on the same level as the Duma and presidential elections of 2011, 2008, and 2007, the most falsified elections in post-Soviet history, as far as we can tell,” physicist and data analyst Sergei Shpilkin said to The Atlantic.”  In 2008, Shpilkin estimated that United Russia actually won 277 seats in the Duma instead of the constitutional majority of 315 that it was awarded.[2] This means that Putin’s party could unilaterally amend the Russian constitution. From a constitutional standpoint, either the hurdles in the amendment process are too low or the election fraud has been so massive the entire form of government is impaired.

The full essay is at "Russian Electoral Fraud."

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1. Valentin Baryshnikov and Robert Coalson, “12 Million Extra Votes for Putin’s Party,” The Atlantic, September 21, 2016.

2. Robert Coalson, “Russia: How the Kremlin Manages to Get the Right Results,” Radio Free Europe, March 7, 2008.

Tech Industry Self-Regulation: Sufficient to Handle the Ethics of A.I.?

Five of the world’s largest tech companies—Google’s Alphabet, Amazon, Facebook, IBM, and Microsoft—had by September 2016 been working out the impact of artificial intelligence on jobs, transportation, and the general welfare.[1] The basic intention was “to ensure that A.I. research is focused on benefiting people, not hurting them.”[2] The underlying ethical theory is premised on a utilitarian consequentialism wherein benefit is maximized while harm is minimized. The ethics of whether the companies should be joining together when the aim is to forestall government regulation is less clear, given the checkered pass of industry self-regulation and the conflict of interest involved,

The full essay is at "Tech Industry Self-Regulation."

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[1] John Markoff, “Devising Real Ethics for Artificial Intelligence,” The New York Times, September 2, 2016.

[2] Ibid.

On the Difficulty of Ethical Leadership after a Breach: The Case of Wells Fargo’s CEO

On September 20, 2016, U.S. Senators questioning Wells Fargo’s CEO, John Stumpf in the Senate’s Banking Committee “seemed unmoved” by his “attempts to explain why more senior bank executives had not been tied to the widespread illegal sales activity.”[1] Bank employees may have opened as many as two million accounts in customers’ names without those customers’ knowledge.[2] Senator Elizabeth Warren, a Massachusetts Democrat, “said the illegal sales were a big driver of Wells Fargo’s success as one of the nation’s most profitable banks.”[3] She called on Stumpf to give back a large portion of his compensation, resign and be criminally investigated. I contend that giving back some of his compensation and resigning from the bank would have been necessary for the CEO get past the scandal in being able to be a credible and trustworthy ethical leader. That the bank’s board acted independently from its chairman, the CEO, a week later in taking back $41 million of his compensation and $19 million of the stock grants from Carrie Tolstedt, who had led the bank’s retail banking division (and cancelled any bonus for either official) does not lend the CEO any renewed credibility.[4] Rather, the action made the bank’s board members look like they were trying to do what was necessary, given the CEO’s underperformance during the Senate hearing.

The full essay is at "Difficulty of Ethical Leadership."

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1. Michael Corkery, “Illegal Activity at Wells Fargo May Have Begun Earlier, Chief Says,” The New York Times, September 20, 2016.

2. Ibid.

3. Ibid.

4. Stacy Cowley, “Wells Fargo to Claw Back $41 Million of Chief’s Pay Over Scandal,” The New York Times, September 27, 2016.