GALACTIC MERGERS & ACQUISITIONS

 How many times must a person look up / Before they can see the sky? ~ Bob Dylan 

For some time now - beginning very early Wednesday morning on November 6th - the sun has been setting on the Biden administration.  

Since then, the Dems have been conducting extended post-mortem finger-pointings on why and how the Repubs and president-elect Donald Trump (the Lyin’ King) successfully captured the federal government trifecta. Triple ouch! Unlike the Dems, the Repubs are understandably licking their chops. 

Nevertheless, the federal government continues operating despite challenges by MAGA radicals. During the remaining 13 days before Donald Trump assumes the presidency, Joe Biden and his cohorts appear to be doing what they can to get some satisfying stuff done, especially if it will complicate Mr. Trump’s presidency. One example is Biden’s prohibiting future oil and gas leasing across 625 million acres of US waters in parts of the Atlantic Ocean, the Pacific Ocean, the eastern Gulf of Mexico and even the Northern Bering Sea. Take that Donald! 

But why didn’t President Biden and Congress pass a law giving citizenship to Dreamers, as they were promised long ago? A fine question. Should we be pleased that most of the prior federal government trifectas have only lasted 2 years? Maybe. 

So we can lament that congressional Dems haven’t managed to appoint even more liberal-ish judges to our federal courts; something they should have been doing way before now but didn’t find time for. And bemoan that the president hasn’t somehow reduced the almost stratospheric price of arabica coffee beans – a 30% wholesale price increase in just the last several months – that has us coffee drinkers in a tizzy. We’re again remined (thankfully) that presidents have next to no power to reduce individual goods’ prices, despite their sometime claims. 

The Federal Trade Commission (FTC) has principal federal responsibility for sustaining market competition by prohibiting anticompetitive mergers and acquisitions (M&A) and other business practices that could lead to higher prices, fewer alternatives and/or less invention. Ms. Lina Kahn was appointed by President Biden as Chair of the FTC on June 15, 2021. Although she’s been running the FTC a relatively short time, Ms. Kahn has aggressively pushed to reduce market concentration held by giant US businesses. However, Chair Khan’s remaining tenancy as FTC Chair is now expected to be quite short, assuming the 47th president wants to bother with the FTC. 

Under her leadership the FTC has strengthened its pro-consumer emphasis, with particular focus on M&A deals. Unfortunately, the FTC’s efforts to limit large M&A activities, have been decidedly mixed with more legal losses than wins. 

One recent success was the FTC’s opposition to the merger of two large grocery store chains – Kroger’s efforts to purchase Albertsons. Last month a US judge in Oregon blocked the merger in a ruling agreeing with the FTC that this merger would end up harming consumers and lead to higher prices. Kroger is the second largest grocery store chain in the US, behind the behemoth Walmart; Albertsons is the fourth largest. Will egg prices – the recently-discovered talisman of consumer well-being – dramatically decrease as a result? Unlikely, but it’s the thoughts that count. 

At this point, it's too late for Dems to do any more about promoting reductions in US market concentration. Soon-to-be President Trump’s heart and soul believes that concentration of corporate power should be promoted, not stymied. 

Ms. Kahn should focus her attention on something far more consequential – very large-scale M&A. I’m talking about President Biden appointing her to lead a new agency perhaps akin to the recently created and wholly unformal, Trumpian Department of Government Efficiency (DOGE). It’s headed by the conceitedly-focused duo of Elan Musk and Vivek Ramaswamy (M&R). Let them begin their promised, Sisyphean attempt to reduce the federal government’s budget by $2 trillion (29.6% of total FY2024 federal spending). A little trimming would probably be useful. But don’t hold your breath. Reducing the federal budget by almost 30% ain’t gonna happen. Why? Because M&R will fiscally need to step on too many influential political toes to cut even 10% of discretionary federal spending over a multi-year period. 

Instead, Ms. Kahn should evoke Bob Dylan’s stalwart Blowin’ in the Wind lyrics (see above), swiftly resign as Chair of the FTC and look skyward to observe the vast amount of M&A happening in the heavens. President Biden will promptly create the Transgalactic Trade Commission (TTC) and have Ms. Kahn serve as its initial Grand Leader. It will be an opportunity of a lifetime for her, given her interest in combating M&A. This time on a galactic scale. 

Sure, there’ll be a starship’s worth of challenges in crafting the TTC, but potentially it will be worth far more than the efforts that has been invested in its creation. If the Biden administration can commit to providing $8 billion in last-minute aid to Israel’s defense, offering a tiny fraction of additional funding to create the TTC should work. Assuming no unexpected challenges (who’s kidding whom, but …), I hope in several years the TCC will be able to tender 25% of the FTC’s current average number of legal case submissions in federal courts. 

Is there heavenly M&A? For sure. The image below from the Hubble Space Telescope shows 2 galaxies in the process of merging to eventually form another, even larger galaxy. 

NGC 6040 & LEDA 59642 merging to create ARP 122

This image shows the tilted, warped spiral galaxy on the left (NGC 6040) merging with the round, face-on spiral galaxy on the right (LEDA 59642) to form the combined ARP 122 super-galaxy. This cosmic merger is taking place 570 million light-years away from Earth’s spot in in the Milky Way galaxy. Referencing the galactic scheme of things, 570M light-years is considered a significant distance even by astronomers. For comparison, the closest major galaxy to us, Andromeda, is a mere 2.5M light-years from Earth. But reducing M&A activity on a galactic scale no matter where it’s located can be a worthy effort. 

The Milky Way, our neighborhood in the universe, is a small-ish barred spiral galaxy spanning more than 100,000 light-years. Its disk contains 100-400 billion stars and at least that number of planets. The Earth and our solar system is perched about halfway from our galactic center, along one of its spiral arms. 

According to recent cosmological calculations based on observations from the Hubble and others of the more than 40 space-based telescopes now circling the earth, there are at least 200 billion galaxies in the observable universe. From this appraisal, astrophysicists think that between 5% and 25% of these galaxies are merging with or being acquired by other galaxies. 

Because there’s an incomprehensively vast number of galaxies twinkling in our skies, even a relatively small number of those actively merging with one another (say, 5%) translates into a gigantic number of galaxies merging or being acquired. OMG! This grandiose, heavenly M&A activity that may produce even more dark matter desperately needs to be managed by none other than Ms. Kahn. Rather than drift in the amorphous realm of what I might do for my next job, is Lina Kahn willing to up her game and become the initial Grand Leader at the TTC, and rise above the challenges to reign in transgalactic M&A? I hope so. 

COMPARING THE US AND CHINESE GDPs

 A PRIMER ON INTERNATIONAL MACROECONOMICS

Mere parsimony is not economy. Great expense may be an essential part of true economy. ~ Edmund Burke 

The United States (US) and the People’s Republic of China earnestly began dancing around each other on the world’s economic stage as long ago as the early 1980s, when Deng Xiaoping was China’s paramount leader. This dance continues… 

 The US gross domestic product (GDP) became the world’s largest around 1890, besting the British, according to paleo-economists. By then, the US economy was more than twice as productive as Britain’s. The Chinese GDP became the 2nd largest in 2010. Both nations’ GDPs remain in the top 2 since these dates. 

I travelled to Beijing during February 1980 on a UN project to teach Chinese planners about empirically-based macroeconomic forecasting models (no abacuses allowed). It was a memorable experience in many ways, including my learning that the sole Beijing hotel that westerners could stay in provided no heat in the dead of winter to its guests like me. None = BIG Brrrr. The hotel’s archaic Russian-built system did not work. Average Beijing high/low temperatures during February are 39°F/19°F; it felt a lot colder especially during the all too plentiful, freezingly-harsh winds blowing through Beijing from the Gobi desert. I attempted to keep warm by frequently drinking copious amounts of very hot tea when I was awake. This partial solution was definitely second-best. I needed functioning, hot radiators in my hotel room. 

Fortunately my stash of Aggregate Supply and Demand curves and least-squares estimators needed for my lectures survived the cold. Aside from a frigid hotel room, it was an extraordinary trip. Ah, foreign travel. 

Both the US and China have come a long way since then. In 2024, the US and China once again have the 2 largest GDPs on Earth. A nation’s GDP represents a key indicator measuring a country’s general macroeconomic health. The concept of GDP was created in the US in 1934, during the Great Depression. By the end of WWII, many nations used GDP to measure their economic status. The real (price-adjusted) 2024 US GDP is 24x as large as our 1934 GDP. 

This analysis offers my interpretation of the 2024 US GDP relative to China’s. Several highlights of this comparison include: 

• The US nominal GDP – the world’s largest – currently is nearly 60% greater than China’s,

• Our GDP per capita is over 3 ½ times greater than China’s,

• Despite having 2 very dissimilar economic systems, the shares of GDP expenditures financed by the US's and China’s governments differ by less than 1% of each other. 

My macroeconomic assessment of the US and Chinese economies is based on information shown in the table below. In addition to nominal GDP, this table considers 7 different factors that influence both macroeconomies. 

As mentioned above, the US  $29.17 trillion GDP, is the largest of any nation and has been since the mid-1890s. Historically, the US became the world's largest maker of manufactured goods and steel by the latter 1880s when it surpassed imperial England’s production. 

Our 2024 annual inflation rate, now 2.6%, has declined steadily since 2021 principally due to the Federal Reserve Bank’s tighter monetary policy efforts. The Fed’s “target” inflation rate is 2%. The Fed began raising its Federal Funds Rate (FFR) in March 2022 to quell inflation. At long last, in September the Fed decided that inflation was close enough to its target, so it began lowering the FFR, its principal interest rate. At its November meeting the Fed again reduced its rate – to 4.58% - hopefully ensuring our macroeconomy will not slip into a partial recession. 

In 2021, at the peak of the Covid pandemic’s economic disruption, our inflation rate was an excessive 7.0%. Although the 2.6% rate is less than half what it was just 3 years ago, current lower macro price increases have not engendered praise by consumers, much to the dismay of Democrats. This is especially true for grocery store items like eggs, whose price notably increased almost 30%, mostly due to avian flu not Joe Biden. Housing prices are up nearly 25% since 2020. Surveys indicate a strong majority of people want no price increases at all. Fat chance of that happening, especially with taller tariffs on the horizon. 

China’s annual inflation rate is a diminutive 0.3%, a level that often typifies an impending macroeconomic slump. China’s low inflation exemplifies the significant economic challenges the nation currently faces. Such challenges include a very distraught property/real-estate market, fragile consumer confidence and increased belligerence from China’s major international trading partners, which directly involves the US especially after January 20. 

Chinese authorities have recently expanded monetary policies to speed up their economy. These efforts include reducing the main interest rate, reducing the Chinese Central Bank’s required reserves, cutting citizens’ minimum down payment for 2nd homes and providing financial support for the principal stock market. 

China’s 2024 GDP growth rate is far stronger at 4.8%, over 70% higher than the 2.8% US growth rate. Nevertheless, the Chinese government is concerned about GDP growth because it has shrunk from 8.4% in 2021. 

Having 1.416 trillion people, China is the world’s second most-populated nation, after India. China’s population is problematically the most rapidly aging on the planet. The US population is the third largest, accounting for only 24% of China’s. This striking difference accounts in part for the impressive disparity in GDP per capita; at $82,715 the US is almost 4x as large as China’s. The US is 9th highest; tiny Luxembourg has the world’s highest GDP/capita, a stratospheric $151,150. 

GDP by Sector.  The table also shows significant differences between how our and China’s GDP is split by our economies’ 3 major sectors; Agriculture, Industry and Services. The US macroeconomy is dominated by the labor-intensive services sector that accounts for over 80% of total expenditures. In contrast, China’s services sector characterizes a meager majority - 54.6% - of its economic activity. China’s Industry and Agriculture sectors each represent far more endeavor than in the US economy. 

GDP by Component.  Finally, compare China’s and the US economy’s GDPs with respect to their 4 major expenditure components, the most common way of measuring GDP: Consumption (C: blue), Investment (I: grey), Government (G: orange) and Net Exports (X-M: yellow). The pie charts below illustrate several distinct differences in each nation’s GDP composition. 

 

Start with the biggest component, personal consumption expenditures. In the US, consumption represents over two-thirds of our 2024 GDP, 67.9%. This dominance exemplifies that our economy is driven by consumers including you and me. Although China’s consumption expenditures have risen, they now represent just 39.2% of their economy, less than 60% of the much larger US consumption share. Next, investment expenditures for the US are17.5% of our GDP; China’s are much larger, 41.4%. For at least 3 decades the Chinese government has prioritized economic growth via investment, not through personal consumption as in the US. This markedly different, notable prioritization is illustrated in the charts. 

The 3rd component, government expenditures, are unexpectedly quite comparable between the 2 countries. US G expenditures are 17.3% of total GDP; China’s G is 16.5%, less than 1% different. For me this is unanticipated because the US is a democratically-founded, diverse private market-based economy. In marked contrast, China’s economy is communist-founded and run by the Chinese Communist Party. It’s evolved and dramatically grown into a mixed socialist economy with strong central state production and control. 

What can explain this surprising similarity of G expenditures between such different economic systems? Possibly that China’s impressive Investment expenditures include a significant amount of unspecified, government-funded investments by its large, state-owned enterprises. In essence, China’s I payments probably include hefty volumes of government investment that’s not included in G expenditures. 

Furthermore, China’s public expenditures for their elderly/retired citizens are much lower than many Western nations’ standards. China’s deeply inequitable pension system provides rural elderly Chinese a publicly-financed pension of $30 per month on average. In sharp distinction, the mean retirement benefit for all US Social Security recipients is $1,784 per month. The US government’s Social Security and Medicare/Medicaid expenditures totaled roughly $3 trillion in 2024, more than 10% of our GDP. 

Net exports (X-M), the 4th and last component of GDP, is the smallest piece. Both nations’ net exports are less than 3% of their GDP in absolute numerical value. But unlike China’s net exports (+2.9%), the US net exports is a negative number (-2.7%), meaning that the dollar value of our imports exceed the dollar value of our exports. 

The yearly US trade deficit (M>X) is not a new thing; it has occurred since the 1970s. Our negative net exports are due to people’s and business’s higher demand for foreign goods and services. This demand leads to greater imports that our domestic industries may not be competitive enough to counter in international markets. 

Last year, the highest-value imports into the US from around the world include crude petroleum, machinery, vehicles and pharmaceuticals. Unlike the US, China is often characterized as an export-driven nation. After it joined the World Trade Organization in 2001, China has consistently recorded trade surpluses with the US and most other nations it trades with. China’s most valuable exports to the US include mechanical devices, electrical and electronic equipment (like iPhones) and textile products. Interestingly, soybeans are the highest-valued export from the US into China by a considerable margin. 

Overall, the US and Chinese GDPs reflect key aspects of the 2 nations’ distinct, differing economic and administrative systems. These systems ultimately are driven by the ever-shifting behavior of US and Chinese people, businesses and government. 

WILL YOUNG VOTES BE A KEY TO KAMALA’S SUCCESS?

 Not voting is not a protest. It’s a surrender. ~ Keith Ellison   

With 36 days until the presidential election, the media is having a field day talking about what it considers will be important groups of potential voters that can surely swing local and national election results. Here are several of the media’s “pivotal groups” for the election I have come across.

First, Omaha Nebraska may find itself at the “the center of the election,” at least momentarily. How could this be? Omaha is the nation’s 42^nd largest city in a steadfastly Republican red state. Because like Maine, the Cornhusker State allocates its Electoral College votes in part by Congressional District, and not the winner-take-all method used by each of the other 48 states.

 

 According to one account, Nebraska’s single electoral vote from its 2^nd Congressional District (CD)[1] (encompassing Omaha) that President Biden won in 2020, could prove vital for VP Harris this November. Because the media has been offering a steady panoply of presidential election possibilities during the ever-shrinking pre-election period, Omaha has captured a fleeting political focal point. Nevertheless, the potential presidential electoral importance of Nebraska’s presidential electoral vote from its 2^nd CD of will depend on complex, faintly possible multi-state voting outcomes, starting with VP Harris actually winning this 2^nd CD delegate election, to really happen.

Next, a recent news story carried this headline, “Young voters play potentially decisive role in 2024 election.” The crucial phrase in this headline is “potentially decisive.” Another story also attempts to tell a convincing tale that young, college-age people may have a pivotal role in the next election. Ah, youth.

Younger voters have played a role in every US election since 1972, just like other voters. This has been true ever since the government reduced the required minimum voting age from 21 years to 18 years via the 26^th Constitutional Amendment that was ratified in 1971. Those were the days.

Regarding our up-coming election, a new poll showed Harris leading Trump by a margin of 32% among likely young voters. That’s a startling and impressive margin. Yet another recent poll of younger voters for CNN found that Harris is preferred over Trump by just 12% of this sample, which if sustained on election day could be a problem for VP Harris. These 2 polls’ quite divergent margins reconfirms my view that whatever result you believe in, you can find at least one of the myriad of available polls that supports it.

Another hopeful story about youthful voters stated that young voters could have a monumental impact on the presidential contest. Nationwide, nearly 42 million 18-to-27-year-olds, the group known as Generation Z, will now be eligible to vote. Some observers say colleges have become more important than in past elections, with campuses hosting more voter-registration drives, debate watch parties and panel discussions designed to urge students to vote. Encouraging anyone, including young people, to vote is always a worthy cause.

For additional perspective, there are nearly 58 million adults age 65 and older in the US, virtually all of whom are eligible to vote. In terms of actual election results, every segment of the voting population can be potentially decisive. Despite the media’s recent zeal, youth voters have never been judged decisive in a presidential election’s outcome. There’s one reason: youth voters habitually have the highest rate of non-voting. Thus, despite the current media attention, I doubt young voters will play a decisive role in the 2024 election. They simply have routinely not voted in sufficient numbers, compared to other age groups, especially “seniors.”

The youngest-aged people only vote one-third as much as older people (10% vs. 34%, in 2022 according to Pew). Despite substantial efforts to get them to vote, young voters do not vote twice as often as older folks (13% vs. 27% in 2022).

Will youth voters have a monumental impact on November 5’s election, as some suggest? That’s highly unlikely. The above-mentioned slender numbers from Pew regarding people aged 18-26 years who voted are not encouraging. In 2022, they represented the lowest age-share of any voter group and the second highest age-share of nonvoters.

Like other age groups, youth did vote much more in our 2020 presidential election (rather than during the 2022 mid-term election). In the last presidential election 51.4% of youth (18-24 years) voted, according to the Census. But even this one-out-of-two youth’s voting represented the lowest voter participation rate across all ages. This analysis confirms that young people have been consistently least likely to vote in every national election since 1980.

Perhaps on November 5 youth-oriented pro-voting efforts can prove successful. College campuses are hosting more voter-registration drives and other activities. I certainly hope such efforts are fruitful, given that young folks’ proclivity to vote has heretofore been frail. But based on history, I lament that these sizeable efforts (including Taylor Swift’s recent endorsement of Kamala) will unfortunately be for naught in encouraging young folks to vote. 

The Pew research shows that the fraction of 18-29 year-olds who voted declined to 10% in our most-recent 2022 elections. That’s the smallest proportion of any voter age group, despite substantial get out the vote efforts by both parties. This November I expect voting throughout the US will be accomplished with diminutive numbers of young voters and far larger numbers of older folks, which honestly I am more comfortable with. Youth is great; and a broader set of life experiences is better as a foundation for voting. Once again, youth voters will likely have neither a monumental or decisive effect on this election’s outcome.

My desire is that plenty of youthful voters, along with your, my and everyone else’s electoral support, will help ensure the vice president’s hopeful victory.

Onward in Democracy for Omaha and beyond.

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[1] Nebraska’s 2^nd Congressional District seat is now occupied by Representative Don Bacon, a Republican, who will be competing with Democrat Tony Vargas in November’s election. 

MANUFACTURING HIGHER TARIFFS, OMG!

Rumors of the demise of the US manufacturing industry are greatly exaggerated. ~ Elon Musk  

Recently President Biden decided he can help American manufacturers by momentously raising US tariffs on certain imported Chinese goods. I lament this action. Yet the importance of our economy’s manufacturing sector has been perennially bellowed by many.

Manufacturing is the process of fabricating goods by manual labor and/or machinery. Humans have been manufacturing objects for thousands of years. Predecessors of Homo sapiens created stone tools 200,000 years ago. About 3,000 years ago during the Bronze Age dagger blades were manufactured using an alloy of copper and tin (aka, bronze), shown below. In this era, technology every so gradually evolved over multiple centuries. Needless to say, since those not really good ol’ days technological advance has speeded up big time.

Bronze Age dagger blade. Wikipedia.

 When President Biden boasted in December 2023 that “We’ve created close to 800,000 manufacturing jobs since I’ve taken office” his statement passed several verifications.[1] But he was not talking about workers creating more modern dagger blades. He was hailing his extensive, multi-billion dollar government-funded industrial policies. His programs are focused on loans and subsidies to manufacturers who are building domestic semiconductor fabrication plants, EV subsidies to help domestic auto-makers, increased green energy production to stymie climate change and good ol’ infrastructure enhancements to shorten our daily commutes.

Most recently, the president has promoted substantial increases in American tariffs on Chinese EVs and batteries (to 100%) and solar panels (to 50%) to protect and assist domestic manufacturers. It’s another political nail sealing the doorway to free trade that a decade ago was a popular and proven prescription for gaining national benefits. Most economists recognize that when tariffs are imposed on imported goods they represent an additional, indirect tax in the form of higher prices ultimately paid by consumers, not manufacturers.

This isn’t the first time elected officials have imposed sizeable tariffs on the US public. The lamentable Smoot-Hawley tariffs were put in place by President Herbert Hoover in June 1930. These big-time tariffs covered over 20,000 imported goods and exacerbated the effects of the Great Depression.

President Biden’s new-found preference for substantial trade protectionism – he voiced disapproval when then-President Trump previously created similar tariffs – will hopefully assist domestic manufacturers. Even if successful, which is by no means certain, such policies will take quite a while to have beneficial effects. These tariffs will certainly produce unintended consequences. Expected consequences include the imposition of retaliatory tariffs by China. Yet the president is quite eager that voters will somehow fondly remember these measures on November 5, even if they’ll eventually pay higher prices as a result. Attempting to recreate the past is never easy.

 The president’s plan to vastly strengthen US tariffs on a broad variety of “strategic” goods imported from China is more targeted to improve his near-term political prospects than attain any specific economic goals. President Biden is using Section 301 of the Trade Act of 1974 that states if the he believes nation’s national security is threatened, he can unilaterally impose or change tariffs. The president believes that in spades; saying his new tariffs will protect American workers and businesses from China's unfair trade practices.

These tariffs will likely result in somewhat higher prices that consumers will face for a broad array of imported items, including solar panels, lithium-ion batteries, semiconductors, steel, aluminum, syringes, needles, personal protective equipment (PPE) and surgical gloves. I didn’t realize surgical gloves and syringes were strategic goods.

If you’re a died in the wool traditionalist like President Biden, manufacturing employment is the only true measure of honest labor. Manufacturing employment peaked in 1979 when 19.6M people worked at making goods. It’s been a long time since manufacturing has been the actual core of our economy. Service industries now account for 80.3% of total employment. Hoping to reinvent yesterday won’t happen even if you’re the president.

When considering the state of US manufacturing, it’s important to distinguish between manufacturing output and manufacturing employment. In April 2024, only 8.2% of US workers were employed in manufacturing. Manufacturing employment has steadily declined during the 7 decades since 1953, when it hit its peak 32% share of total non-farm employment. The Bureau of Labor Statistics forecasts US manufacturing employment will continue declining to merely 7.5% of all workers by 2032.

Manufacturing output however has defied economic gravity and held steady principally due to impressive increases in automation with consequent improvements in the sector’s productivity, relative to the overall economy. Domestic manufacturing output has kept a roughly 10% share of our real (price-adjusted) GDP. This increased use of automation/robotics in manufacturing means a substantial majority of manufacturing workers now are highly-skilled and well-trained.

I’d like to believe the president’s much-elevated tariffs will not result in weighty economic harm. I also wish these misguided actions might serve to strengthen his election prospects, but doubt they will. Even though the media does its best to make it seem like November 5 is the day after tomorrow, it remains 156 days away at this point.

Tariff policy per se never captures more than an ever so slender sliver of voters’ attention. Higher consumer prices due to these tariffs however will gain attention of far more people. Finally, misdirected actions like the president’s higher tariffs pale in comparison to what’s ahead if a now-convicted felon succeeds him after election day. So it goes…

 

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[1] I won’t quibble with the president, although it’s more accurate to say 589K manufacturing jobs were recovered from the thankfully-brief Covid recession, and 175K new jobs were created. However you slice it, a great many manufacturing jobs have been gained during the president’s time in office. 

PROTESTS IN 2024 & 1968

In such ugly times, the only true protest is beauty. ~ Phil Ochs  

Do 56 years make a difference? Perhaps. Despite the magnifying effects of social media, I do not believe the current 2024 pro-Palestinian protests at dozens of US college campuses will be nearly as consequential as the anti-Vietnam war protests that happened in 1968.

One recent count states that 90 colleges among the 5,999 in the nation have had protests with about 2,300 total arrests. Curiously, unlike prior ones the protests at UC/Berkeley have yet to draw many headlines. One recent example protest in the news involved some of the 663 full-time students at the Art Institute of Chicago.

Granted, the current protests are not finished and there is much talk about them continuing for another 100 days until the Democratic National Convention (DNC) in Chicago that begins on Aug. 19. Talk is far easier than undertaking the significant efforts needed to make that actually happen. It is more likely they will peter out in the next several weeks, and then attempt to re-assemble for the DNC in mid-August.

I wonder how these college-based protests can be sustained after commencement season that is now in full bloom and will end within a month. The challenges facing demonstration organizers include how they can keep students focused on a protest without schools in full session. Naturally, any time local gendarmes over-react at a protest, the activists become revitalized. Indeed police have at times over-reacted, including stationing combat-ready sharpshooters on the roofs of nearby campus buildings at one of my alma-maters.

Nevertheless, the media’s attention has already begun skidding behind the actual conflict in Gaza. Whatever they may be worth, recent polls indicate only one-quarter of American people support these protests. At this point these antiwar protests now seem to be slight compared to the big bang of anti-Vietnam protests that I played a very minor part in that befell our nation and the DNC in Chicago 56 years ago. The media’s attenuated comparisons between the far larger anti-Vietnam protests and the Gaza protests reflect slender similarities.  

The Gaza protests are focusing on tragic events in the Middle-East that were initiated by Hamas’ dastardly attacks in Israel on Oct. 7 and killed more than 1,200 Israelis and foreign nationals, including at least 35 US citizens. Hamas and other compatriot groups seized 253 hostages. A total of 112 hostages taken prisoner during the attacks now have been freed. The fates of the remaining 141 hostages remain a mystery because Hamas refuses access to them for anyone. The Israelis have forcefully retaliated causing significant destruction and loss of life, as shown below.  

Gaza destruction from Israeli shelling.

The Gaza protestors, like those at Columbia University, are demanding that their colleges divest from companies that “publicly or privately fund or invest in the perpetuation of Israeli apartheid and war crimes.” US firms that the protestors have cited for colleges to divest from include Amazon, Google, Hewlett-Packard, Starbucks and McDonalds.

What results do protestors desire from disinvesting specific equity holdings like Hewlett-Packard or McDonalds from a college endowment because it sells computers or Big Macs to Israel’s government and the Israeli Defense Force (IDF)? Is this act supposed to change the Israeli government’s actions against Gazans and Hamas? American college endowments cumulatively are sizeable, but represent just a shard of international financial assets. If a college were to sell its endowment’s positions in these stocks, how much influence would it then have to possibly persuade these firms to change their global strategy with respect to Israel? None.

What would be the next set of endowment holdings that other protestors would want removed? Perhaps US Treasury bonds because our government has provided significant financial aid to Israel. In fact, since the end of WWII Israel has received more US foreign aid than any other nation on Earth, $312 billion. Shouldn’t the protesters want such aid to stop, given that it has provided Israel with significant improvements for the IDF, among other things. Disinvestment has the theoretical appeal of capitalist debasement, but not for gaining influence with respect to some protesters’ fuzzy goals.

The cause for the State of Palestine has been made numerous times over an historically extensive time period. Most recently on May 10, when the UN General Assembly (UNGA) offered a vote to upgrade Palestine’s membership in the UN. The vote was 143-9 approving the upgrade for Palestine from “non-member/observer status” to “member status,” with 25 abstentions. There are currently 193 UN member states, thus apparently 16 member states did not formally vote or abstain on this motion.

This was the second time the UN considered including Palestine as a full member state. In 2011 Palestinian President Mahmoud Abbas first delivered the Palestinian Authority's application for UN membership. It failed. The Palestinians did not receive the required minimum support from the UN Security Council (UNSC). Instead, Palestine received observer status in 2012. Palestine is one of two states that have observer (non-voting) status at the UN, the other is the Holy See/Vatican City.

The UNGA May 10 vote was entirely symbolic – something the UN habitually specializes in doing – because the inclusion of any national state into the UN requires prior approval for membership by the 15-member UNSC. A minimum of 9 of the 15 UNSC members must approve the request for full membership. As one of the 5 permanent members of the UNSC[1], the US retains veto rights on any measure put before the Council for a vote. The US vetoed the vote for Palestinian inclusion as a full UN member state.

Deputy US Ambassador to the UN, Robert Wood, told the General Assembly after the vote that unilateral measures at the UN and on the ground will not advance the US-preferred two-state solution. He stated, “Our vote does not reflect opposition to Palestinian statehood; we have been very clear that we support it and seek to advance it meaningfully. Instead, it is an acknowledgment that statehood will only come from a process that involves direct negotiations between the parties." Furthermore, the current Palestinian reality is there are 2 deeply rivalrous, ununified fragments to Palestine; the East Bank Palestine that is headed by Mahmoud Abbas’s Palestinian Authority and the Gaza authority that is headed by Hamas’s staunchly seclusive Yahya Sinwar.

The continuing diplomatic journey to establish a State of Palestine has navigated many twists and turns. In retrospect, mistakes have been made by every participant. The journey to Palestinian statehood was altered when the State of Israel was created in 1948, becoming a UN member in 1949. Since its beginning, the US has been a key ally of Israel. Both nations have benefited from this relationship. Nevertheless, this may be changing a bit under the strong right-wing control of Prime Minister Benjamin Netanyahu. President Biden recently threatened to halt some shipments of US offensive weapons if the Israelis move ahead with their invasion of Rafah.

Unlike the current Gaza protests the anti-Vietnam War protests throughout the US involved hundreds of thousands of Americans. There are several inter-related reasons why the Vietnam protests were so much broader than the Gaza protests. First, in the late 1960s all young American men between 19-25 years old were required register with the Selective Service System (aka, the draft) for military service. Second, President Lyndon Johnson made the tragically flawed decision to send large numbers of US combat personnel to aid South Vietnam’s fight against the invading North Vietnamese. President Johnson’s decision supported President John F. Kennedy’s previous 1961 decision that authorized smaller numbers of US military advisors to assist the South Vietnam government in developing strategy and tactics to combat North Vietnam’s raiding guerrilla troops.

The US Vietnam draft began in 1964. The US military conscripted 2.2 million American men during this period, which brought the Vietnam tragedy directly into families’ lives throughout the 50 states. The Vietnam War was never far from any American’s thoughts.

My Selective Service (draft status) card categorized me as 4-F, meaning I was legally registered but not qualified for military service. No, not because I had heel spurs like Donald Trump alleges. I was, and remain, a type 1 diabetic. Ironically, my having diabetes likely saved my life after my college deferment ended as a 21 year old B.A. degree holder.

About 2.7 million US troops fought in Vietnam for a decade, ending in 1973. An estimated 10,000 women also served in Vietnam, principally as nurses/medical staff as well as in administrative roles, military intelligence or air traffic control. More than 58,000 Americans died and more than 150,000 were wounded in Vietnam.

The estimated fiscal costs of the Vietnam conflict, that unequivocally pale in comparison to the human toll, exceeded $176 billion during 3 US presidencies: Kennedy, Johnson and Nixon. Retrospectively, the US’s entry into Vietnam’s civil war has been properly viewed as a giant military, political and cultural blunder of the first-order.

The Gazan conflict is significantly distinctive. Unlike Vietnam, there are no US armed forces fighting in Gaza. The scale of conflict is much slimmer. Perhaps more importantly and thankfully, there is no longer a draft requirement for young Americans to fight in the Middle East or anywhere else.

Comparisons between the protests in 1968 and 2024 have been made, but in a real sense the current protests about Gaza are incomparable to those that happened during the Vietnam War. The times are different, the politics are different and the public is different. The Gaza protests reflect these differences; many thousands of antiwar activists will not be marching in Washington DC towards the capitol with strong public support.

Although thoroughly despicable, Hamas’ strategy of hiding deeply underground within Gaza’s daily urban milieu is as outrageous as it is wretchedly shrewd. This strategy, together with Prime Minister Netanyahu’s scorched-earth tactics to improbably eradicate Hamas and its fighters, has resulted in immense damages to innocent Gazans’ lives. So far the Israeli Defense Force (IDF) has killed or injured more than 110,000 people living in Gaza, whose communities have been destroyed. Water, food, fuel and healthcare remain in desperately short supply in Gaza.

 Given these circumstances, what can the pro-Palestinian protests hope to achieve, other than expressing understandable exasperation and rage? Other than symbolism, somehow convincing college trustees to sell their endowments already-slender holdings of Israeli equities will have next to no actual remedial effect on Israel’s conduct in Gaza. Maybe symbolism is sufficient, although I doubt it. Trustees may be reluctant to do even this because it opens up future possibilities of having to unload other equities that upset another set of activists. More substantively, none of the Gaza protestors’ demands are aimed at getting Hamas to stop its staggeringly appalling tactics that precipitated Israel’s invasion. This is probably a purposeful oversight, but that bias limits the protestors’ broader support.

Although unlikely, the protestors should take as a victory President Biden’s latest public decision about the Prime Minister’s war tactics. The Gaza protests have encouraged the President to stop delivery of giant bombs and other over-the-top weaponry that the DOD calls “high-payload munitions.” Finally, I urge Gaza protesters to reconsider showing up in Chicago at the DNC. If they somehow disrupt the DNC’s proceedings – that the media will unfortunately happily support and emphasize no matter how inconsequential – they will only increase the odds that #45 will become our 47th President. That fate would be disastrous for far more people than the 2 million Gazans.

 

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[1] The 5 permanent members of the UNSC are: China, France, Russian Federation, United Kingdom of Great Britain and Northern Ireland and the USA. The 10 non-permanent members - 5 of which are elected each year by the General Assembly for a 2-year term - currently are: Algeria, Ecuador, Guyana, Japan, Malta, Mozambique, Sierra Leone, Slovenia, South Korea and Switzerland. 

 

IT’S ALL ABOUT MONEY

While money can’t buy happiness, it certainly lets you choose your own form of misery. ~ Groucho Marx  

Money makes the world go around. Money or currency is commonly defined as a generally accepted commodity used as a medium for making commercial transactions, a store of value and a means of stating prices, values and costs. Humans have used money in their daily lives long before the advent of written history. Archeological objects related to coinage have been found dating back over 100,000 years.

Long before 1869 when George Washington first graced his visage on our $1 bill, numerous items have served as money, including cowrie shells (Africa, Asia, Oceania, Europe), red ochre (Australia), wampum (Native Americans), whale teeth (Fiji) and very large carved limestone disks (Yap Island in Micronesia).

Sea shells have been used as a US currency far more recently. During the Great Depression, some drugstores in California provided change to customers in clam shells when cash was in short supply. Cowrie shells and Yap Island’s giant stone disks are shown below as examples of very old money. Cowrie shells may have been pocket change, Yap’s disks certainly were not. 

 Yap’s stoned money 

A fortune in cowrie shells

Economists classify currency in 2 distinct ways. First, as commodity money (like gold and silver coins, candy bars and cigarettes in WWII prisoner-of-war camps and peanut M&Ms for US troops in Afghanistan) are items that have intrinsic value in some other use. Precious-metal coins were initially used as money in several places about the same time, around 600-500 BCE; in China’s Yellow River valley, in India’s Ganges River valley and by the king of Lydia in western Asia Minor (modern Turkey).

Second, as fiat or token money that is an item designated as money by an acknowledged, trusted authority that is otherwise intrinsically worthless (like the “paper” we use for US bills composed of 75% cotton, 25% linen). Paper money banknotes first arose in China during the 7th century.

According to the Federal Reserve, the most recent value of all the currency in the US money supply is $5.8 trillion, which is almost 21% of our current GDP. The most valuable US banknote now in circulation is the $100 bill, otherwise known as the Benjamin because Benjamin Franklin’s face is on it. Over the past 5 years, Benjamins have become the most widely-circulated banknote, representing 34.3% of all circulating currency, overtaking the George (aka, $1 George Washington banknote). Circulation of the Andrew (aka, $20 Andrew Jackson banknote) increased significantly during the 1980’s when ATMs became broadly popular. The Andrew’s circulation is in third place, right behind the George.

What is the largest US banknote ever circulated? The Salmon P. Chase $10,000 banknote, first printed in 1918. It was never used much except for banks, given that its value was greater than the net worth of the average American for most of its history.

Mr. Chase was one impressive person: he was a governor and then senator from Ohio, served as Secretary of the Treasury under Abraham Lincoln, and became the 6th chief justice of the Supreme Court in 1864. He remains one of the few people to serve in all 3 branches of the federal government.

The Chase $10,000 banknote was purged from US currency in 1969, along with other large banknotes like the William McKinley $500, Grover Cleveland $1000 and James Madison $5000 bills. After this culling, the Benjamin became and remains the largest US banknote. 

Perhaps the most interesting coin produced by the US Mint is the silver dollar. The true “Silver Dollar” production began in 1794 and ended in 1935 as this was the last year that 90% silver coins were made for circulation. In 1975-76 the Bicentennial Dollar (with President Eisenhower on the face) was produced, but with a 40% silver content. In 2021 the mint began production of Peace Dollar coins, also with a 40% silver content.

Speaking of money, what is the most profitable US export? I think it is the $100 Benjamin banknote. Because there are 11 foreign nations that use either fully or partially US currency as their domestic currency, including Ecuador, El Salvador, Zimbabwe, Panama and Micronesia. That’s in addition to the 5 official US territories that use our currency: Puerto Rico, Guam, America Samoa, U.S. Virgin Islands, and Northern Marina Islands. 

Citizens in these 11 nations and their governments buy US banknotes at their face value, if not close to it. The US Treasury's cost to produce one $100 Benjamin is $0.086, which is an implied ”return” of 1,163 times its face value. Production costs for the $1 George are $0.028, an implied “return” of 35.7 times its face value. That's considerable "profit." 

According to the Federal Reserve Bank of Chicago, almost 80% of $100 US banknotes and more than 60% of all US banknotes are used overseas, a sizeable increase from roughly 30% in 1980. Such an increase in exported US banknotes is not only impressive, but likely quite profitable for the US Treasury. The Treasury’s foreign customers for US currency may soon include Argentina. Argentina’s new President Javier Milei campaigned to officially “dollarize” his nation. That may or may not happen, but if it only unofficially does, it could involve supplying South America’s second largest economy with more US currency’s fine crew lead by Benjamins, Andrews and Georges.

Money is said to be legal tender when the government requires it to be used in settlement of fiscal transactions, including tax payments. For example, you cannot settle your owed taxes with the IRS by paying in candy bars or shells, or for that matter with coins.^[1] Only US dollars will do via check, online payment or debit/credit card.

Congress established the US dollar as the basic unit of currency in 1792. The first coins were created in 1793 at the Philadelphia Mint and presented to Martha Washington. The US government did not issue paper money until 1861, when it helped finance the Union’s Civil War efforts.

Before our 1776 Declaration of Independence, the majority of currency used to conduct commerce in the American colonies was commodity money. Wheat is one example of a commodity currency that was used nearly 400 years ago in Massachusetts.

Before 1700, many students at Harvard College paid their tuition with wheat because hard currency – the British pound or Spanish real – was challenging to come by in the early colonies. The Massachusetts Bay Colony prices for standard items were stated in terms of bushels of wheat and corn, not British pounds or pence. Using such agricultural produce as a commodity currency in early America was not surprising. Throughout the 1700s, at least 90% of the American labor force was farmers.

No wonder paying with wheat made sense and cents at that time. Samuel Willis, Harvard class of 1653, its 13th graduating class, paid his tuition with wheat.

Here’s a current-day perspective about what a wheat-based Harvard tuition could be. Using a recent price of wheat together with Harvard’s 2023-24 tuition ($54,269 not including room and board), a student would need to provide Harvard College with 8,269 bushels of wheat for full tuition. This heavy tuition load of wheat would require a 167 acre farm to grow it and 2 big railroad hopper cars to transport it to Harvard’s Student Accounts Office in Cambridge. Surprise!

Wheat farmers have not been at all pleased with the market prices they are facing. Over the past year the average price of US wheat has dropped nearly 24%, which is not at all good if you’re paying tuition with your own-grown wheat, but no big deal if you are not a wheat farmer whose daughter is going to Harvard. Nevertheless, having to pay for tuition with 8,269 bushels of wheat would be inconvenient, to say the least.

All things considered it is very fortunate that Harvard, along with every other college and the rest of our economy, grew out of our 17th century wheat-as-commodity money habit. Hitching our fiscal wagons to fiat money’s US dollars makes sense.

 

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[1] Despite income tax protestors’ efforts, the IRS has successfully refused to accept tax payments with coins. So keep your pennies in your piggy bank, don’t include them with your 1040 form. 

 

REPARATIONS FOR K-12 STUDENTS

The Berkeley Unified School District’s (BUSD’s) Reparations Task Force (RTF) began meeting last April. The RTF has been tasked with determining how the BUSD could fund reparations, what form of reparations it would recommend to the BUSD Board and formulating a recommendation on how the Board could implement that program. No other school district in the US has taken it upon itself to cure the ravages of slavery. Berkeleyside, a local news periodical, recently published a story written by two RTF members, “Now is the time for reparations in Berkeley schools” attempting to justify their mission. I was not convinced.

Most school districts find it challenging enough just to keep their K-12 students educated in these challenging times of teacher and budget shortages. Nonetheless, other school districts are not located in Berkeley, California, a long-time nucleus for progressivism.

It is utterly unclear how the BUSD, or any local school district, is suitably equipped to remedy the damages caused by historical slavery. Most folks correctly understand people possibly affected by the ravages of past slavery are far more numerous than one community’s Black K-12 students.

From its outset, the RTF believed the BUSD has caused direct harms to some of its students from segregation, discriminatory policies and other legacies of chattel[1] slavery. Thus, it supports the district paying these students financial reparations for these harms.

Last year the State of California’s own pioneering reparations task force presented its assessment of the issue from a more apt, state-wide perspective. Its report recommended to the legislature that eligible, long-standing Black California residents each could be owed up to $1.2 million for repairing the damages of slavery and racism. Given the controversary surrounding reparations, this report seems to have been subsequently swept under Sacramento’s political rug. Neither the Legislature or the Governor have provided any meaningful public responses regarding paying for reparations.

The BUSD RTF has postponed until this summer making their recommendations about how to fund, plan and implement a reparations program in Berkeley’s schools. The RTF states that a majority of its members are descendants of individuals enslaved in the US. The RTF has undertaken one “community engagement survey” to solicit input on the types of reparations it should recommend. This survey seems to have been sent to 3 groups of people – descendants of enslaved Californians, students at BUSD schools and students’ caregivers. The reported RTF survey results published in Berkeleyside appear to be erratic, as shown in the chart below.

 

    Source: Berkeleyside, 3/23/2024 

This chart states there were 1,386 total respondents (All Respondents) for this question. But the sum of survey responses from the 3 groups – Descendant Families, Current/Former BUSD Students and Caregivers of Current/Former BUSD Students – adds up to 1,649 respondents, 263 more people than the total respondents. This makes no sense unless All Respondents includes none of the other groups. Or the RTF made a straightforward addition error. Or was there another group of 263 people who received the survey, but was not reported. If the All Respondents are a distinctly separate group, who are they? This inconsistency is a mystery.

The RTF has never stated that their survey was sent to people who were representative of Berkeley’s citizenry. It is thus unsurprising that an astounding 85% of all survey respondents said they were “in support of financial payments to students for educational purposes.” The surprise is that it was only 85%. 

These BUSD RTF results are very different from other reparations surveys. Past surveys have focused on possible remedies provided by the federal government, state governments or local governments. A 2021 Pew survey found that 75% of reparations supporters say the US federal government, not other government organizations like cash-strapped school districts, has all or most of the responsibility to repay descendants of enslaved people. Like other surveys, this Pew survey found that a large majority of Black adults (77%) think the descendants of people enslaved in the US should be repaid in some way and that only a slight minority (18%) of White adults agreed that reparation payments are appropriate. A 2023 poll by UC Berkeley’s Institute of Governmental Studies showed California voters opposing reparations payments by a 2-to-1 margin.

The RTF will likely advocate to the BUSD that fiscal reparations are wholly justified for every Black student who attends K-12 schools. Using the most recent available data, there are 1,134 Black students in the district’s 17 schools. They probably also will promote reparation payments be made to former qualified BUSD students as well. The bigger the proposed total reparations payments are for the BUSD, the more satisfied the RTF will likely feel. The RTF may have a larger target in mind for the reparations amount per qualified Black student to out-progressive the efforts of both the ill-fated San Francisco Reparations Advisory Committee (that recommended $5 million per qualified person) and the aforementioned California Task Force to Study and Develop Reparation Proposals for African Americans’ $1.2 million per qualified person.

So far, the RTF’s mandate apparently excludes addressing common-sense questions about why a local school district should even provide such reparations, or how the district could afford to pay such reparations, given its educational mandate. The latest Berkeleyside RTF story (March 27) mentions that they may recommend adopting a new Berkeley tax to provide funding.

The simple fact is neither Berkeley or the BUSD can afford direct financial reparations or other reparations-related expenditures. If the city and/or BUSD somehow decided to pay reparations, it would need to raise the needed substantial funding either through a new city tax or a public, general obligation (G.O.) bond. A new tax might only require a simple majority of voters to pass, the bond would likely require approval by at least two-thirds of voters.

No matter where funding would come from, getting Berkeley’s voters to pay for BUSD reparations would be a singularly fraught and divisive campaign. Currently, less than 8% of Berkeley’s population is Black/African-American, 12.5% of BUSD students are Black. Another possible, more politically-expedient option for the BUSD is to accept the RTF’s findings in June, then offer an honest, sincere apology for the harms to Black students it directly or indirectly created in the past, and say nothing with respect to financial reparations.

So far, this strategy seems to be what the California Legislature and Governor Newsom have adopted after the California Task Force submitted its 1,000 page report last May. Subsequently, public talk about state-funded reparations largely disappeared into Sacramento’s political ether. Also, San Francisco Mayor London Breed indirectly but publicly disagreed with her Committee’s direct reparations recommendations. Her office stated, “The Mayor does not believe that addressing the needs of the African American community requires adding more bureaucracy,” referring to the establishment of a proposed SF Office of Reparations.

Like many school districts, the BUSD is now facing mounting financial challenges because of continuing reduced student enrollment in Berkeley’s public schools. The BUSD’s fiscal future is cloudy, at best. In 2017, 10,340 students were enrolled in BUSD schools. In 2022, it was 9,073 students. That’s a 12% drop over the last 5 school-years. Making a similar calculation of the BUSD average student enrollment change during the last 3 school years, it’s a 7.8% drop. BUSD personnel have said that yes average student enrollment has fallen, but the rate of the drop is lessening. That’s true, but immaterial.

Reductions in student attendance presages diminished BUSD funding from the state because California expenditures for K-12 education are based on average daily student attendance in each district. Like other California school districts, it’s virtually certain that state education funding for BUSD will decline. In 2023 overall California state education funding shrank by $2.1 billion.

Last year the BUSD’s director of fiscal services cautioned that the coming 2024-25 school year could be a “reality check” for the district if the state’s funding formula for schools does not change. It’s California dreamin’ to believe this formula will change to benefit BUSD and other school districts. Why? Because last month California’s projected 2024-25 tax revenue deficit increased to a sizeable $73 billion. More state money going to school districts is an unlikely prospect, no matter how worthy.

Fortunately for the BUSD, last month Berkeley voters once again strongly supported the city’s Berkeley Schools Excellence Program (BSEP), a local property tax increase now responsible for 17% of the district’s budget. The district budget needs to continue rising. A growing proportion of the BUSD’s costs has been focused on providing support for “high-need” students. Evermore districts, like the BUSD, will be facing daunting “fiscal cliffs” due to 4 factors: no additional temporary Covid-related education funds are available now to school districts, shrinking K-12 student enrollments due to changing demographic trends, continuing inflation and appropriately-increased teacher/staff salaries. Because 83% of the BUSD’s budget are employee-related expenses, the impending fiscal cliff will result ultimately in school personnel reductions.

The RTF survey purposefully was not sent to a statistically-representative sample of Berkeley citizenry. It’s thus no wonder that an astonishing 85% of respondents said they were “in support of financial payments to students for educational purposes.” Do you think 85% of Berkeley voters will be willing to pay for cash reparations to the 12.5% of BUSD students who are Black? I doubt it.

The survey-based percentages presented by the RFT, as shown above, have nothing to do with whether all Berkeley residents believe it’s appropriate for the BUSD to pay reparations to K-12 students who have suffered from the impacts of chattel slavery and its legacy. Not being representative, the RTF survey results cannot characterize anything definitively beyond the survey subgroups’ respondents themselves.

Berkeley has been justifiably recognized as an honest-to-goodness mecca of progressive thought, but I question whether a majority of voters would say yes if asked to actually pay reparations to qualified Black BUSD students. After all, when the Berkeley City Council placed its biggest-ever bond measure (Measure L) on the ballot 2 years ago with hopes of funding a very broad array of activities, it went down in ignominious defeat.

The RTF’s public statements about school-based reparations payments confirms both their strong advocacy and that they hold an atypical worldview where providing sizeable direct reparations payments only to their small number of Black K-12 students will meet little resistance. Depending on the specifics, I can support indirect reparation remedies to qualified Black citizens. I cannot support the Berkeley school district providing direct reparation payments to its Black K-12 students.

 

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[1] Chattel refers to a human being considered to be property, an enslaved person.