E.U. and U.S. Counterparts Met: A Basis for Comparison

President Barak Obama of the U.S., and Herman Van Rompuy and José Barroso of the E.U. held a news conference following the EU-US Summit at Lisbon in 2010. Even though the E.U. and U.S. are both empire-scale federal unions of states, and thus are equivalent in terms of political type or genre, they differ in terms of how their respective federal offices are arranged and constituted. This does not, however, nullify the basis of comparison.

For example, the E.U. does not have one definitive president; rather, the Commission has a president, as does the European Council. Interestingly, the alternative of having more than one president (e.g., a presidential council) was debated in the U.S. Constitutional Convention in 1787. Yet this difference does not mean that the E.U. and U.S. are not comparable. In fact, I submit that each union can be strengthened by such a comparison. 

The picture below also shows the full presidential equivalence, while showing that the EU is not structured at the federal level as a replica of the US. 

The placement of the respective flags is interesting because the arrangement was, at least as of 2019, only done for countries. By implication, I submit, the EU flag, rather than the flag of an EU state (e.g., France) should be set with the US flag as a backdrop. At the very least, the EU flag and the flag of the state of France should both be present, for the sovereignty of the state of France is partial, just as is that of the state of Texas. Both states, in other words, are in federal systems in which governmental sovereignty is split between the federal and state polities.

Besides in how they are arranged, the flags themselves are also visually equivalent. Both contain stars, which represent semi-sovereign states, or polities, which are on the scale of the early-modern nation-state. The early US flag is even more equivalent, for the number of stars is roughly the same. 

The E.U. flag was designed by Arsène Heitz and Paul Lévy for the Council of Europe in 1955. The EC and the E.U. would subsequently adopt the flag as their own. The "Betsy Ross" U.S. flag was in use by 1777. Regarding the number of stars, whereas the 13 on the U.S. flag represent the original 13 states in the U.S. alliance, the 12 stars on the E.U. flag were chosen when the Council of Europe had 15 members (10 of which were founding members). Even so, the similarity between the two flags is striking, especially as both the U.S. and E.U. have added states since their respective foundings. It would seem, in other words, that both unions have followed the same evolution, which is another signifier that the unions may be in the same political genre. 
Lastly, the "EU and US" sign in the news-conference photo above implies that the two unions are equivalent. Lest it be objected, at least as of 2019, that the EU is not a political union, I submit that having a parliament, executive (the Commission), and supreme court (the ECJ) renders the federal level not only political, but also a government. The denial (in the E.U.) and ignorance (in the U.S.) on this point boggles the mind. Such is the force of ideology on cognition and perception.

The picture below also shows the full presidential equivalence, while showing that the EU is not structured at the federal level as a replica of the US. The placement of the respective flags is interesting because the arrangement was, at least as of 2019, only done for countries. By implication, I submit, the EU flag, rather than the flag of an EU state (e.g., France) should be set with the US flag as a backdrop. At the very least, the EU flag and the flag of the state of France should both be present, for the sovereignty of the state of France is partial, just as is that of the state of Texas. Both states, in other words, are in federal systems in which governmental sovereignty is split between the federal and state polities. 

Interestingly, the photo below attests that U.S. flag flew next to the E.U. flag in front of an E.U. building in Brussels in 2012. Perhaps knowledge of the proper equivalence existed within the E.U.'s federal government, while still noticeably absent at the state level, including the residents thereof. 

Even though the E.U.'s federal level has been criticized for being populated by technocratic officials, I submit that the nature of the E.U.'s laws (e.g., directives, regulations, etc) are such whereas the officials have tended to have a good understanding of the E.U. as a political system meant in part to act as an international counter to U.S. power. 

For more on this topic, please see: Essays on Two Federal Empires: Comparing the E.U. and U.S., available at Amazon.

Police/Security Over-Reaches: A Mentality Unfit for the Job

Absolute authority corrupts absolutely. On an organization or even a local scale, people with authority can play considerably on the ignorance of individuals to over-reach at their expense. As a consequence, surveillance and actions can be horribly excessive without there being recognition of it. Seeing an off-duty police employee wearing a bullet-proof vest and standing next to a store security guard in the entry-way of a grocery store in Phoenix, Arizona, for instance, can give at least new-comers an immediate sense of the excessive use of authority to intimidate even the innocent shoppers. As if seeing a policeman and security employee "greet" customers entering the store was not enough, I also saw a young mother with her young daughter in one of the aisles “freeze up” at the sight of the policeman (wearing a bullet-proof vest) staring at them in a confrontational posture from the end of the aisle. I could not believe my eyes. As the front doors opened as I left the store, I looked up only to see a security guard with his feet pointed right and left, respectively, in a confrontational posture. 

A security guard stands in a confrontational posture at an Albertsons (Frys) grocery store in Phoenix.

Could such practices ever be accepted as the default in the "land of the free"? It depends on the State. Furthermore, how does such ill-fitting excessiveness, which would only fit were someone reported to be shooting in the store, shift from inappropriateness to become the default—the status quo? Typically the underlying mentality is one of stubborn ignorance that cannot be wrong, backed up by an excessive and microscopic grip on real or invented authority. How is it that the more educated and broad-minded perspective in upper-echelon management comes to doubt even its common sense by being hoodwinked by the lower mentality? Excessive delegation to middle-and-lower levels of management, where the wider perspective can easily be lacking, may be part of the answer. Playing a supporting role, the value-system in the local culture may actually support the excess or look the other way in blind obedience to an ideology. Finally, if a practice beyond the pale gets its toehold in the status quo, then people can become blind to the excessiveness and treat it instead as normal. Excessiveness as the new normal. Dislodging an invasive or encroaching unquestioned trend can be very difficult given the nature of the status-quo default to act like cement. Two case studies demonstrate that an absurd over-reach by someone in the security field can occur. The first took place in Orlando, Florida. Accountability did occur, so the absurd was not allowed to become ensconced. The second was in Phoenix, Arizona. Such accountability is much more difficult there, so the aggressive over-reach of authority would likely become further ensconced in the conducive or enabling local culture. 

In September, 2019, an elementary school “resource officer” arrested two 6-year-olds at school in Orlando, Florida. At least one of the kids had committed the high crime of kicking another student. The “resource officer,” a misleading term for what was actually a policeman capable of making arrests (a resource for whom?), was subsequently fired for not having obtained permission from a “watch commander.” The militaristic term, commander, in having anything to do with first-graders, makes clear just how far the Orlando police department had overreached. Indeed, I submit that the cloak of being a resource is just as dishonest, and overreaching, as is the appropriation of military terms. A police employee is neither a security guard nor a military commando.

Of course, arresting a first-grader is such an obvious overreach that the judgment involved in the overreaching itself is arguably incompatible with the legal right to use lethal force. At least one of the first-graders was arrested for battery, fingerprinted, and had mugshots taken. That a police employee (or department) would even suppose that with a commander’s permission is appropriate or sufficient to arrest a first-grader for kicking another kid is so far-fetched that a lack of perspective, not to mention common sense, was also in the mix. Even Florida State Attorney Aramis Ayala chastised the Orlando police department when she said, “These very young children ought to be protected, nurtured, and disciplined in a manner that does not rely on the criminal justice system to do it.”[1] That a police employee (and department) would interlard that system indicates a basic lack of understanding regarding that system and the fact that it has boundaries. People who have problems with boundaries should not be wielding power, for such people love power too much to exercise it realistically. For a child to make being a child a crime suggests that that child should not be allowed to play with guns, much less to be lawfully entitled to use them. 

Such an obvious overreaching mentality can also exist “under” the police, such as in security guards. In Phoenix, Arizona, for instance, the security guards on the light-rail trains have regularly over-reached beyond their authority. This reflects the culture, as the same tendency can be observe in other domains there. 

For example, some of the employees of the security subcontractor have turned on passengers simply for taking pictures inside the train. Guards have aggressively threatened to kick such passengers off the trains, using the flimsy excuse that the guards had been photographed and the erroneous claim that picture-taking on the trains was illegal. Such ignorance that could not be wrong backed up by authority that simply did not exist is inherently toxic and utterly incompatible with (i.e., a danger to) wielding even the authority that has been authorized. Beyond even the ignorance is the sheer aggressive nature that looks for any opening in which to bully another person. In fact, the dismissiveness of other people’s natural boundaries may itself be sociopathic. The aggression unleashed by efforts to hold such people accountable points to a demented perspective in which the victim rather than the aggressor is actually the aggressive party. 
It is interesting, or telling, that security employees would be so preoccupied with passengers taking pictures and yet actually refuse to do anything, whether on a platform or on a train, about a passenger known to have walked across the tracks even in front of an oncoming train. 

This man rushed across the tracks so fast his baby's carriage back wheels caught on a rail.  

Once I witnessed a man run across a street (amid oncoming cars) and across the tracks before entering the train-car that I entered. The security employee told me that he too had seen this, but could do nothing. "The street is not our property," he explained. "Aren't the tracks your property?" I countered. He did not reply. Being so reluctant to even confront such a passenger (or people smoking on the platforms) is quite a contrast to the excessive presence of the employees on a train car. 

Three security employees are clustered together in one half of a rail car. Typically none of them would be checking tickets. Imagine being a passenger surrounded by security guards! 

Looking at me leaving the train and then at the three security employees, the man in the foreground asked me if he could enter the train! When I was on the train standing next to the door, the security employee shown on the right walked over and stood in the middle between the doors, blocking the entry-way to the rest of the car. He was too big to be standing in that space, but I suppose he felt that he could do whatever he wanted as he had a badge.

That the security company put as many as six guards at a time in a car (typically not during commuter times, as office workers could be expected to complain) suggests a proclivity toward and enabling blind-spot concerning excessiveness itself. At the very least, the employees don't care whether passengers feel uncomfortable as a result. Sometimes the excessiveness is so obvious on a rail platform that customers may stand at a distance until a train comes.

Four or five security employees were on this platform. 

Twice I witnessed around fourteen police and security employees enter a rail car to check tickets. In both instances, three or four passengers were taken to the platform to be surrounded by the police and security employees as the latter wrote municipal citations! Imagine if so much attention were directed to a motorist pulled over for speeding! In effect, the passengers were being treated as criminals likely to become violent. 
Tellingly, at least one supervisor of bus drivers at a bus-transfer hub in Tempe decided to have his new van's yellow lights flashing continuously, as if the default were to treat the routine as a constant state of emergency just because one might be possible. 

Even during daylight hours, on a Sunday when the hub was virtually empty, a supervisor still felt the need to have his flashers on!

The flashing yellow lights on top of the white van are barely visible, and yet presumably someone thought they were fitting. 

People who are not willing or able to perceive when they have gone too far should not be permitted to wield power over other people. 

The relationship between excessiveness and over-reaching is an interesting one. Perhaps the former connotes being oblivious while the latter stresses the underlying motive. In both of the cases of Orlando and Phoenix, the excessiveness in the over-reaching itself was of such an extent as to be utterly transparent to the naked eye. It is perhaps a easily overlooked truism that going beyond authorized authority is itself an over-reach.

Typically when an over-reach or excessiveness is treated as part of the legitimate status-quo, or societal default, the culprits eventually go so far that they come to be viewed as a problem. For example, the decision of Allied Security in Phoenix to have the ticket-checkers/security-guards wear police-color uniforms and even separate silver badges could eventually lead to the company being charged with intentionally impersonating police. 

One of six security employees (not the one who became aggressive concerning picture-taking of half of the car)  watching passengers (rather than checking tickets) on a routine basis rather than because of an incident suspected or in progress on one car of a light-rail train in Phoenix. The obvious police impersonation, with its (intended) implications of additional authority, is no accident. Even though the employee pictured here was not belligerent, she and another employee blocked the conduit between the two sides of the car (and thus were "front and center" for any general picture-shot).

I submit that the impersonation to look like police employees was geared to intimidating customers beyond that which a security guard as such could muster. On account of the low pay, minimal qualifications (a High School diploma), and the bad (hiring) management (as reported by former employees online), it should be no surprise that the attitude toward customers has been more like that of the local police to the citizens than customer service in a company. The allure of power taken can be too much, especially if that elixir is not ideally in a customer-service attitude.
In the Phoenix Public Library, the security employees also wore silver detachable badges, at least as of 2019.  

The security employees are so numerous that a patron could easily sense that the library's management had gone too far. That the security employees intermingle with the police stationed at the library renders the impersonation problem more of problem because patrons could more easily assume that the employees also have police powers. 

The policewoman is at the left-back, next to one of the security employees. 

That the police and security employees are constantly making the rounds passing by patrons who are reading or studying does not render the library a place conducive to studying. 

At the Tempe Public Library, armed security employees with badges stood at the entrance at least by 2019. A volunteer told me that a manager had insisted that the "Welcome" desk be relabeled "Security" just in case patrons miss the point even in seeing two armed guards in front. 

Those security guards, each having a gun and taser, also made rounds through areas where patrons were reading or studying, as the video below testifies. 

At one of the pot dispensaries in Phoenix, a security guard could be seen sitting at a close proximity to the customers on whom he was keeping a direct eye. I doubt it made any difference to him whether they felt uncomfortable with his excessiveness. To him, he may not even have been excessive. 

The security guard is seated on the right, positioned to face the three customers seated against the side wall. Was the guard worried that one of the customers would suddenly explode in reefer madness? Such over-blown assumptions, while ludicrous, have existed in Arizona even as marijuana was legal in some of the other States. 

In the television series, Downton Abbey, the Dowager Countess, played by Maggie Smith, remarks that power goes to the head of a common person like strong drink. She is referring to the village physician whom the British military put in charge of the military hospital during World War I at the Downton residence. If that could be said from her perspective of a physician, the hiring of (in many cases) inner-city youth to wear badges on trains can be expected to lead to a host of problems.  

The dynamic can be explained by appropriating Nietzsche’s philosophy in which some people are weak internally and so they cannot resist their instinctual urge to dominate even and especially the strong. The weak resent the strong for their self-confidence and surfeit of strength. Whereas the strong do not feel a need to use more power than necessary because they have more than enough strength anyway, the weak will stoop to even cruelty to exact even a bit of pleasure from the exercise of power externally; exerting power internally, as in mastering an intractable urge, requires more strength than the weak have.

If a hiring budget is inadequate to attract a certain maturity- and knowledge-level, then fine-tuning the hiring criteria will not be adequate. Unfortunately, if, as Nietzsche says, the weak cannot but be weak and the strong cannot but be strong, then training too can be expected to have limited usefulness. Organizational, governmental, and even societal accountability may have to be called on to supply the needed check on the power-overreaches. Unfortunately, in such a law-and-order culture as has existed in Arizona at least through the first two decades of the twenty-first century, security guards as well as the local police could be expected to get away with a lot. Even the state's major universities, including ASU and UA, were not immune from over-reaches by security guards given police status (a police department is reports to a city, rather than an organization), and yet students passively took it while the "academic" administrators compromised academic ways to make way for other values such as intimidation (i.e., of students). 

It was not uncommon, at least by 2019, for campus "police" to park their cars on a routine basis on sidewalks used by students to get from class to class. The assumption that they would not be concerned passing such a car belongs in a fantasy movie rather than on at an institution of higher learning (at least in principle). 

It was not uncommon for campus police to "patrol" in one place on an ongoing basis out in front where students walk. The obvious need to stick out carries with it a certain amount of ego and lack of concern for how the young students may be affected emotionally. Few, I submit, would feel that such a presence during a school day is necessary to feel safe. 

In fact, in addition to the campus police, ASU hires student security guards. The result is a sense of constantly being watched on that campus, which obviously must have had cameras too. 
Once while talking to two students representing a cause at a table, I noticed that a student security guard was taking his job too seriously, or was told to do so, by how he was so obviously watching us. I was reminded of the secret police of the Communist states in the last century. 

Notice how needlessly confrontational the security employee's posture is in this picture. 

To the extent that a local culture enables the over-reaches by casting a blind or even permissive eye, as in Arizona, the imposition of checks on authority are especially important. That Florida's authorities, in contrast, came out against the child-cop who tried to criminalize being a child suggests that not every state is as dire in this respect as is Arizona. 

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1. A. Willingham, Artemis Moshtaghian, and Amir Vera, “A School Resource Officer Is Fired after Arresting Two 6-year-old Children,” CNN.com, September 23, 2019 (accessed same day).

The U.S. Justice Department and Facebook: Secretly Mining Personal Information

Collusion between business and government has hardly been a rarity; the extent of secrecy regarding it , however, may be a surprise. Whereas business-government economic partnerships (as well as university-government partnerships) have typically been made public, the extent to which government uses businesses to get information on citizens has hardly been transparent. In spite of a U.S. federal law enacted in 2015, documents released in September of 2019 “show how far beyond Silicon Valley the practice extends—encompassing scores of banks, credit agencies, cellphone carriers and even universities.”[1] The documents, which cover 750 of the half-million subpoenas issued since 2001, reveal that more than 120 companies and other entities received subpoenas for information on customers, users, or students. F.B.I. could lawfully “scoop up a variety of information, including usernames, locations, IP addresses and records of purchases” without a judge’s approval.[2] A gag order keeps the businesses from divulging even the receipt of a subpoena. So much secrecy accompanying so much power is, I submit, dangerous to a republic. In fact, the subtle effects on citizens in the public square can easily be overlooked even if the negative impact on freedom is serious.

The documents reveal that the credit agencies received a large number of subpoenas, as did financial institutions like Bank of America. Universities including Kansas State University and cellular providers including AT&T and Verizon, as well as tech companies like Google and Facebook also received subpoenas. The public was kept in the dark, due to “several large loopholes” enabling the U.S. Justice Department to refuse even to review “a large swath” of gag orders.[3] Loopholes have been a common practice in legislation impacting business, given the power of large businesses or industries to influence lawmakers via large campaign contributions. I submit that the loopholes enabling secrecy on the subpoenas are even worse for a republic’s viability because of the extent of governmental power that is possible from mining private data on citizens. The potential uses—again in the dark—go well beyond reducing or preventing crime.

Political uses, for example, should not be discounted. Even as Facebook’s CEO, Mark Zuckerberg, was assuring users that they had control over what data is shared, the company’s COO had devised a business model that would substantially raise Facebook’s revenue by secretly allowing third-party “app” companies access to user data. The practice enabled Cambridge Analytic to influence users politically without the users’ knowledge. In the case of the F.B.I. subpoenas, partisans in governmental roles could conceivable gain access to the data through political pressure (e.g., from Congress or the White House).

Moreover, I submit that a government with a lot of information on citizens is totalitarian with respect to information, and such a near-totality can easily breed a totalitarian state in the sense of control over citizens. They in term could be expected to increasingly fear sharing personal data with businesses. In 2018, for instance, I tried out Facebook. After just weeks with an account, I was surprised when the company demanded that I send a photo in which my face is recognizable. I had read that the company had been working on facial recognition technology, and the explicit demand for a recognizable face seemed strange to me. I also knew that Facebook regularly shared user information with third-parties, whether business or governmental in nature. I had nothing to hide, but I did not like feeling invasiveness even in the demand itself. So I experimented by taking a picture on a public sidewalk of a poor person not likely to have an account. Facebook deleted my account without explanation. I would have deleted the account anyway rather than use a fake picture. I wanted to see whether Facebook would use its facial-recognition technology to assess the picture. Either the person whom I photographed had an account or Facebook already had access from an external entity (such as my web-site) of my face. Even just the use of secret software to assess the photo I had submitted struck me as excessive, and I would not have been surprised to discover that Facebook had access to more personal information that what I had shared on my account. Facebook itself could be said to be a private totalitarian state. Given the compromised ethics in the company’s brief history, I felt uncomfortable with Facebook having any of my personal information and, moreover, concluded that such a company with a totalitarian approach to information as a means at the very least of raising revenue is major problem. Sadly, given the susceptibility of the Congress and White House to political influence from large campaign-contributions,  the company’s wealth and thus political pull could keep a law from being enacted that would force Facebook to permanently remove all information pertaining to me at my written request. It would be interesting if any U.S. citizen could have access to any data collected by the F.B.I. from businesses and other external entities unless deemed classified by a judge in the Judiciary. The purpose would obviously not be to help criminals.

With personal data being provided on “social networks,” as well as to other companies, banks, phone companies, and internet providers (including universities), and with the U.S. Government having unlimited access to that information, a person could be expected to feel that he or she has a contracted personal space. Even in one’s home, if a cell phone or computer is on (and even if it is off, I have read), the government may have a way to look in. Not even a personal conversation on a cell phone can any longer be regarded as private. The sphere of a sense of freedom of expression has likely come to be feel very restricted. I suspect that Americans have resisted this encroaching de facto sense of limitation on their personal freedom by being in the illusion that an actual phone call is private and that neither a government agency nor Facebook is keeping tabs on which sites are being visited or what is being said or done on a phone. Yet the diminishment of the sense of freedom, especially when a person is in public but also on private property, is real, which a decrease in the quality of life going along with the masked fear. The People can regard this constriction of freedom as being subject to the Will of the People rather than merely something that can evolve by means of vested interests inside and out of government. In other words, an electorate need not be passive.

Moreover, a government’s totalitarian approach to gaining information on the citizenry is contrary to the notion of a limited government wherein the People are the popular sovereign. A limited government is a key part of a republic, whereas a totalitarian government is vital to a dictatorship wherein the People have no power. Adding to the concern is a private company’s totalitarian approach to information-gathering, especially if such a company has lied to its users about it. Interestingly, the third-party commercial app makers can be considered the company’s clients, whereas the users supplying the data are suppliers. In other words, the users are not the customers. The suppliers are not paid in monetary terms; rather, Facebook pays those bills by allowing the suppliers to use the company’s platform—activity that increases the supply of information!

In supplying something, a supplier transfers a commodity to a buyer; the supplier cannot claim ownership or control of the commodity once it has been supplied. Obviously if the buyer lies to the supplier regarding the contract, the supplier has grounds to take back the commodity supplied. The suppliers did not agree (and thus were not “paid”) to allow Facebook to contract with Cambridge Analytic, a client, to use the commodity to manipulate the suppliers themselves. To be sure, ordinarily a supplier would not expect to have any say as to what a buyer does with the commodity, but Mark Zuckerberg made oral promises that the company’s user-suppliers would continue to have a veto over how Facebook uses the commodity, including with whom the said commodity is shared. Because the CEO lied, it is important for the suppliers to realize that what had begun as a social network for college students became a business model. Unfortunately, the typical user is not even aware that he or she is actually a supplier. 

Government use is of course different; it can legally be done secretly, thus without the knowledge of Facebook’s suppliers. So it becomes a political question of whether the People should allow their government, assuming it is a republic, to have access. Citizens would be wise to remember that absolute power corrupts absolutely, and that with great power comes a huge responsibility even if the powerful may tend to shrug off the responsibility as they seize even more power.

See related: Taking the Face Off Facebook: Strategic and Ethical Issues, available at Amazon.

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1. Jennifer Valentino-DeVries, “Secret F.B.I. Subpoenas Scoop Up Personal Data From Scores of Companies,” The New York Times, September 20, 2019.

2. Ibid.

3. Ibid.

.U.S. Constitutional Checks and Balances Under Threat: Congressional Oversight

Ambition checked by ambition. The assumption that political ambition can be counted on is the key to the “checks and balances” feature of the U.S. Constitution. Each of the three “arms,” or “branches,” of the federal government is checked by at least one other. This is not to say that the other arm takes over the function or even has greater competence; rather, the other arm is oriented here to providing accountability on abuses of power and investigating cases of gross negligence or incompetence. An offended branch should thus not be permitted to claim that oversight is not appropriate because it interferes with the function the branch. Treating oversight by another arm of the federal government as inherently partisan or illegitimate eviscerates the vital “check and balance” aspect of the U.S. Constitution. 

In disputes on oversight between two branches, the benefit of the doubt ought to go with the overseeing branch because it is only natural for human beings to resist being held accountable and so accountability itself needs a boost. I have in mind the case the director of national intelligence, Joe Maguire, blocking the inspector general from sharing an intelligence-whistle-blower’s complaint with Congress in September, 2019.

The contents of the complaint included a phone call between President Trump and another national leader in which Trump made a commitment. Ukraine was relevant. Rep. Adam Schiff, chair of the House Intelligence Committee, had been concerned that Trump’s delay in assistance to Ukraine had been politically motivated. The Democrats had planned to investigate whether Trump’s withholding of military assistance was not to get the Ukrainian government to reduce corruption, but, instead “to coerce the Ukrainian government into pursuing politically motivated investigations” into Joseph Biden, President Obama’s former VP and a contender to run against Trump in 2020 for president.[1]

Providing the U.S. House Intelligence committee with the contents of whistleblower complaint was “generally required by law.”[2] The executive branch insisted that the requirement must involve the funding, administration or operations of an intelligence agency, whereas Democrats maintained that the law did indeed apply. Regardless, Congressional oversight of the executive branch goes beyond particular statutes mandating the providing of whistle-blower complaint information to Congress. Nevertheless, the inspector general, Michael Atkinson, wrote to the committee that the complaint fell within the jurisdiction of the director of national intelligence and “relates to one of the most significant and important of the D.N.I.’s responsibilities to the American people.”[3] Atkinson was conflating a jurisdiction within the executive branch with oversight by another branch of the government. Put another way, oversight does not in itself rid the director of his jurisdiction; rather, oversight investigates the contents within that jurisdiction. Furthermore, that the director of national intelligence has an important job does not mean that it is immune Congressional oversight of the executive arm. I submit that the importance of the job is an argument for a greater need for oversight—not less.

It is as if Atkinson believed that the intelligence agencies were immune from such oversight, and thus from the vital checks-and-balance feature of the U.S. Constitution. For oversight to be viable, the branch of the government being overseen cannot decide whether oversight is allowable. Rather, the branch doing the overseeing can make that assessment and the other branch can contest it in the courts. The judiciary arm would serve as a check against the overseeing arm. In other words, the prerogative in the executive branch of somehow being beyond Congressional oversight stands in the way of the functioning of the checks-and-balances constitutional design. Ambition should not be allowed to bar contending ambition. What employee of a company would claim, “I can’t do my job if there is any supervision of my work!”? What department would claim that it is exempt from oversight from the company’s management because of the nature of the work being performed? Rather than cohere, such a company would eventually break apart.

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1. Julian E. Barnes et al, “Whistle-Blower Complaint Sets Off a Battle Involving Trump,” The New York Times, September 19, 2019.

2. Ibid.

3. Ibid.

On the Supply and Demand in Housing Markets: Rent Control in California

In February, 2019, Oregon’s legislature passed rent-control legislation limiting rent increases to 7% annually plus inflation. New York’s legislature strengthened the existing local rent-control regulations in New York City. Roughly six months later, California’s legislature passed rent-control legislation limiting annual rent increases to 5% after inflation and strengthening other tenant protections.[1] Not even the largest landlord group and the California Business Roundtable had opposed the legislation in spite of the fact that rent-control even as a concept flies in the face of the free-market ideology that has been so popular in America. Indeed, economists “from both the left and the right have a well-established aversion to rent control, arguing that such policies ignore the message of rising prices, which is to build more housing.”[2] Accordingly, only four of the American states (and Washington, D.C.) had some kind of local rent-control. So what accounts for the rent-control fever that had taken hold in 2019? I want to point to the immediate context then in California, and then to a more theoretical explanation that calls for distinguishing shelter from real-estate investing.

California’s poverty rate of 18.2% was at the time the highest in the United States. San Francisco’s homeless population had increased by 17% since 2017, while homelessness in Los Angeles had increased by 16% since 2018.[3] Homelessness had become a dominant issue politically. Voters had approved “several multibillion-dollar programs to build shelters and subsidized housing.”[4] Assemblyman David Chiu, author of the rent-control legislation, said of the homeless problem, “Protecting tenants is a critical and obvious component of any strategy to address this.”[5] Dampening the fear of displacement was part of this protection. With homelessness at epic proportions and housing markets continuing to rise in many urban areas, the fear could easily become unpalatable particularly for middle-class renters. In other words, a source of instability that renters can typically overlook had become so acute in California that reducing the fear was included in the rationale for the legislation.

More theoretically, the fear a person naturally has at some level of losing his or her shelter without being able to move to another is a byproduct of subjecting housing to an unobstructed market-mechanism. Where laissez-faire capitalism is especially revered, the fear is accepted as a fact of life even though it is not a fact of life in societies in which a safety-net includes housing. Moreover, there is no guarantee that an equilibrium in a given rental market is in line with every resident having shelter. In fact, as many of the California rental markets demonstrated especially in the years leading up to 2019, rising demand does not necessarily translate into enough of an increase in supply. The 7% plus inflation increase allowed in the rent-control legislation was in part intended to encourage more supply. Yet even so, the government had increased spending on subsidized housing. In short, a rising housing market acts on demand and supply in such a way that homelessness can increase; even efforts by government to add to supply (e.g. subsidized housing) may fall short.

Perhaps as in the case of health insurance wherein the U.S. Government used subsidies to see that the poor and middle class have had access to medical care while wealthier Americans could by premium health-insurance on the free market, the matter of shelter could be distinguished from that of real estate; the supply of basic shelter would not be “decided” by a market-mechanism, but by how many people (e.g., homeless) need shelter. Homeless men and woman whose health warrants supervision could be accommodated by group homes or assisted living apartment complexes. The wealthy could still play the housing market, treating houses as commodities. The distinction between shelter and a commodity makes it easier to understand why and how the fear of displacement can be so salient as in California in 2019. The market mechanism is incompatible with shelter viewed as a human right (therefore sans fear).

In summary, both the homeless crisis coming to a head in San Francisco and Los Angeles in 2019 and the incompatibility of shelter and the market mechanism can explain why California’s government took action on rent-control even though it would not solve the homeless problem. For that to occur, the government as well as non-profits and even businesses (e.g., CSR) would need to step in such that the supply would be sufficient to house the demand even apart from ability to pay full rent.  In other words, I submit that shelter in an interdependent society (rather than the state of nature) can be unconditional, in contradistinction to investment in real estate. The fear of displacement alone points to the incompatibility of shelter and conditionality (i.e., the market mechanism); so too did the extent of homelessness in California. Clearly, replying on a market-equilibrium, even if without realizing it, had given rise to severe distortions.

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[1] Conor Dougherty and Luis Ferré-Sadurni, “California Approves Statewide Rent Control to Ease Housing Crisis,” The New York Times, September 12, 2019.

[2] Ibid.

[3] Ibid.

[4] Ibid.

[5] Ibid.

A Strong State vs.The Market Mechanism in China

Under Marxist ideology, the Chinese economy was a command-and-control economy eschewing the market mechanism. Mao's collective farms provide us with a good example. The economy of the U.S.S.R., also Marxist, was based on production quotas and fixed prices. They changed by fiat rather than by changes in demand. State owned, or socialist, productive enterprises were given quotas based on the prior year's production (plus more). This push replaced that of producing more to sell more. Any hint of a market brought with it the stench of Capitalism. So one would suppose that China marked a significant departure when the government announced in 2013 that it would expand the range in which the yuan currency would float. Yet in 2019 in the midst of a trade tussle with the United States, the Chinese state demonstrated just how dominant the state still was relative to any market system.  

The reforms incorporating the market mechanism had begun under Deng Xiaoping. Although publicly-owned and state-owned-enterprises still dominated, they were set within a market economy. The mix of government-owned (i.e., socialist) businesses and a market mechanism has been uneasy in practice. Private or partially-privately owned enterprises could find it difficult to compete with competitors subsidized by the state. Widen the circle to international trade and foreign private enterprises could be found having the same complaint. Of course, the domestic and foreign consumers stood to benefit by the subsidized lower prices, so assessing the existence of state-owned enterprises is more complex than first meets the eye. In part, this is so because governments tend to emphasize the interests of business rather than consumers.  

The United States, for example, has protested against the Chinese government devaluing its currency. A low currency means that exports are less expensive in exported markets.  The complaint has been that "a weak yuan gives Chinese exporters an unfair price edge in foreign markets and helps swell the massive U.S. trade deficit with China."[1] In the face of the trade dispute with the U.S. in 2019, China promised in August "to avoid 'competitive devaluation' to hold down export prices in the face of of Trump's tariff hikes."[2] However, the yuan's low point of 7.0927 on August 23, 2019 was the currency's weakest rate since January 2008.[3] The heavy hand of the central bank could easily dominant market forces because the bank set the exchange rate every morning and let the yuan fluctuate only 2% against the dollar during the day. 

Interestingly, the Chinese government had announced in 2013, "The exchange rate is going to be more market-oriented" [4] People's Bank of China Vice Governor Yi Gang made this statement on a panel at the International Monetary Fund’s 2013 spring meeting in Washington. In other words, “China's central bank plans to widen the yuan's trading band in the near future," he said.[5] This meant that China's leaders would "press ahead with change despite the surprise slowing of the economy."[6] On the surface, this shows that the "Communists" were really serious about moving closer to a market economy. At a deeper level, this shows just how much power the government still had over its economy--power that could be used to restrict the market in service to state objectives. In the literature of international political economy, the Chinese government would be classified as a strong state because it could resist external pressure. By contrast, six years later, the U.S. Federal Reserve would lower a key interest rate due to political pressure from the White House, where concerns of a possible recession in 2020 were intensifying. The weak state classification could also explain the accumulating federal public debt (i.e., the failure to resist pressures to tax less and spend more). 

From a big-picture perspective, balance or equilibrium in the global economy is in everyone’s financial interest. Keeping a currency artificially low is like a dam keeping waters from reaching a balance. The pressure from the held-up water can be expected to destabilize the global economy. China’s policy to gradually let the yuan’s value be market-determined was thus taken to be a prudent step. However, American frustrations on state subsidies and a low yuan in 2019 suggest that the Chinese government rather than the market mechanism was still very much in control of the Chinese economy. 

1. Joe McDonald, "China Let Its Currency Sink to an 11-Year Low After Trump's Trade Threats," Time Magazine, August 26, 2019. 

2. Ibid.

3. Ibid.

4. Natasha Brereton-Fukui and Bob Davis, “China Vows Wider Yuan Movement,” The Wall Street Journal, April 17, 2013.

5. Ibid.

6. Ibid.