Monday, January 22, 2018

How Progressivism Destroyed Utica

 Below is a picture of the population trend in Utica, NY from 1850 to the present. Unlike Buffalo, whose population peaked in 1950, right after passage of the urban renewal act, the population of Utica peaked in the 1930s, about 15 years before urban renewal and about 20 years after an expansion of workplace legislation in 1911 to 1913, during New York's Progressive era.

The 1911 Triangle Shirtwaist Company fire in New York City had led to the passage of dozens of labor laws in the mid 1910s. According to Wikipedia's entry on Al Smith (who was the speaker of the New York State Assembly and a member of the New York State Factory Investigating Commission, which proposed the laws):
 
New laws mandated better building access and egress, fireproofing requirements, the availability of fire extinguishers, the installation of alarm systems and automatic sprinklers, better eating and toilet facilities for workers, and limited the number of hours that women and children could work. In the years from 1911 to 1913, sixty of the sixty-four new laws recommended by the Commission were legislated with the support of Governor William Sulzer.

Other sources say that there were 36 laws, but whatever the precise number, there was a lot of new regulation.

The stagnation in the Utica population began about six or seven years after Smith's State Assembly (and Robert Wagner's State Senate) passed the Progressive-era laws, and the decline in the Utica population began about 15 years after.

According to Wikipedia, "Utica's economy centered around the manufacture of furniture, heavy machinery, textiles, and lumber." All of these are subject to factory regulation, which in effect raises wages. Employers contemplate the cost of regulation in their relocation decisions.

As well, the 1913 founding of the Federal Reserve Bank, also in the Progressive period, led to increased availability of credit. Easy credit meant reduced costs of relocation. There may have been early relocations of plants away from the city of Utica into surrounding suburban areas and into the South.


The combination of easing credit and increasing workplace and other regulation--the policy mix of both parties, but especially the Democrats--has been deadly to American manufacturing.


Instead of thinking about underlying causes of Trump's popularity, the American media has fixated on ad hominem attacks and shrill rhetoric.


Wikipedia's entry on Utica says that suburbanization began occurring in earnest in Utica in the 1940s, but there may have been an earlier trend as credit became available. The suburbanization of the pre- and post-war eras anticipated the broader globalization that followed the easing of credit and further expansion of regulation before and after the abolition of the international gold standard in 1971.


The post-1971 world has been brutal for those who create value. Those who live off the state as commercial or investment bankers, government contractors, government employees, and welfare recipients have fared well.


Unlike Syracuse, Utica does not have a nationally ranked university. Hence, it has not as easily participated in the state-subsidized education industry. Unlike Albany, it isn't a seat of an ever-expanding state bureaucracy. Unlike New York, the city that has benefited most from expanding credit, it is not a seat of global finance and bailout funding.


Utica actually produced goods of value like furniture. It was not a center of financial or political power, which produce nothing. Such production has been  punished in the credit-based economy, which supports a limited degree of innovation and instead favors low-risk investments such as plant relocations.
Historical Population of Utica, NY



  

Sunday, January 21, 2018

How Urban Renewal Destroyed Buffalo, NY

    
Below is a picture of the population of Buffalo, New York from 1830 to 2017. In 1949, Congress passed the American Housing Act. According to Wikipedia, "It was a landmark, sweeping expansion of the federal role in mortgage insurance and issuance and the construction of public housing."

The Housing act was supposed to be a support to cities. It was the chief "urban renewal" law.  Encyclopedia.com adds:

Sites were acquired through eminent domain, the right of the government to take over privately owned real estate for public purposes, in exchange for "just compensation." After the land was cleared, local governments sold it to private real estate developers at below-market prices. Developers, however, had no incentives to supply housing for the poor. In return for the subsidy and certain tax abatements, they built commercial projects and housing for the upper-middle class.

Robert Moses was a leader in eminent domain actions going back to the 1930s. The sponsor of the law was Moses's friend and fellow Yale graduate, Senator Robert Taft. Taft had alerted Moses as to the passage of the law, and Moses saw a state law passed that increased his own power to oversee the urban renewal programs in New York.

The year before urban renewal went into law, signaling increased federal government involvement in the economy, Buffalo's population peaked. Its population, along with most other upstate New York cities, has declined ever since the law went into effect.

Saturday, January 13, 2018

The Racism of John R. Commons--And What It Says about Columbus Day

Two guys on Facebook , Jeremy Horpedahl of the University of Central Arkansas and Phillip W. Magness of Berry College, sent me material that documents the racism of John R. Commons. Commons was the chief founder of institutional economics in the United States.

Commons can be fairly called the creator or conceptualizer of the current American industrial relations system and the innovator of much of the New Deal.

Hence, if we are to tear down statutes of Columbus, Jefferson, and Lee because they were racists, so should be consider tearing down the New Deal, which also was the product of racists, conceptualized by racists, and put into place by racists.  Commons, for instance, designed the first workmen's compensation law, in Wisconsin, and discussed social insurance reforms and unionization.

Just how racist was John R. Commons? 

In his "Racial Composition of the American People: The Negro" Commons writes of the western coast of Africa:

The torrid heat and the excessive humidity...produce a race indolent, improvident, and contented...Sexual purity is unknown...Formerly cannibalism prevailed, but it has now been largely stamped out by European governments...The people are unstable, indifferent to suffering, and  easily aroused to ferocity by the sight of blood or under great fear...They exhibit in Africa certain qualities  which are associated with their descendants in this country, namely, aversion to silence and solitude, love of rhythm, excitability, and lack of reserve.  All travelers speak of their impulsiveness, strong sexual passion, and lack of will power.

Donald Trump is fairly criticized for calling African countries "crappy," but what are we to make of an American New Deal, social insurance and welfare system designed by people who made similar remarks?

Commons adds:

slavery tended to transform the savage by eliminating those those who were self-willed, ambitious, and possessed of individual initiative...Other races of immigrants, by contact with our institutions, have been civilized--the Negro has been only domesticated...The very qualities of intelligence and manliness which are essential for citizenship in a democracy were systematically expunged from the Negro race through two hundred years of slavery.

Commons goes on to call "the war of emancipation" one of "dogmatism" and "partizanship" [sic] because equality and inalienable rights took the place of education and slow evolution of moral character. 

He adds: "Self-government means intelligence, self-control, and capacity for cooperation.  If these are lacking, the ballot only makes way for the 'boss,' the corruptionist, and the oligarchy under the cloak of democracy."

In discussing how African Americans can be educated in order to be "prepared" for "citizenship" Commons claims that African Americans lack the ability to be trained to use steam cleaners or to paint ceilings.

He says that the majority of African American mechanics are "careless, slovenly, and ill trained." As well, he adds:

the improvidence of the Negro is notorious. His neglect of his horse, his mule, his machinery, his eagerness to spend his earnings on finery, his reckless purchase of watermelons...these and other incidents of improvidence expalin the constant dependence of the Negro upon his employer and his creditot.

When African Americans did become wealthy due to property ownership, Commons attributes this to "unearned increment" rather than intelligent investing.  He adds, "Negro bosses and foremen are more despotic than white bosses." As well, "the Negro trade unionist has not as yet shown the organizing capacity of other races,"  and "when the Negro demands the same wages as white men, his industrial inferiority leads the employer to take white men in his place."

In response to the list of ways that African Americans were supposedly inferior to whites, Commons proposes "an honest educational test" for voting "enforced on both whites and blacks."

In a closing fit of racism, Commons attributes higher death rates among African Americans to moral rather than environmental and social causes.

In New York City, Mayor de Blasio and his left-wing supporters  have proposed to tear down statues of Columbus and Theodore Roosevelt. Why shouldn't the New Deal, a legal system designed by a racist, should be treated the same way?

Friday, January 12, 2018

All Science Is Politically Influenced; Social Science Is More So

Are the natural sciences as ideologically driven as the social sciences? No, but the extent that the natural sciences are politicized is understated by almost everyone, including many scientists.
Sociologists of science depict the natural sciences as heavily political. See, for instance, Bruno Latour, Science in Action, and Leviathan and the Air-Pump by Shapin and Schaffer.
However, the premise of Thomas Kuhn in The Structure of Scientific Revolutions and Karl Popper in the Logic of Scientific Discovery is fundamentally right: Natural science does engage in falsification, and their tests are relatively value free, although I do not doubt that the direction in which they go and the subjects that they study are ideologically and governmentally influenced.
The social sciences are primarily ideological. They are not science. Economists are especially narcissistic in this regard. Microeconomic theory is value free, but the rest of economics is to a large degree ideological, especially in the fields of macroeconomics, labor economics, and monetary economics.
The other social sciences are often if not mostly ideological. 
The tax exemption that universities enjoy for social science and humanities instruction should be eliminated unless the same tax exemptions are given to Republican advocacy organizations. That universities are primarily political organizations is seen in the adoption by the humanities, which should be involved in the transmission of our great Western culture, of politicized, social science approaches.
The hard sciences have better justification for public funding, but if government money is to be used for science, Republicans are advised to ensure that Democrats, who dominate universities, are not using the funds for politicized science.  One way to do this is to focus on chemistry, mathematics, molecular biology, medicine, and physics, and to limit (or at least carefully balance) funding for geology, environmental studies, and environmental biology.