NYC TAX | DOES "Amnesty" Work?

Feb. 27, 2009–The Daily News has been running a series of stories showing more than $2 billion in various fines and taxes owed to the City of New York by scofflaws. Their reporter Erin Einhorn today writes that the City Comptroller has sent a letter to the Mayor calling for a tax amnesty.

A tax amnesty works like this: The tax collection agency announces a window of opportunity during which taxpayers owing money from prior years may voluntarily pay up. During this window, the taxpayers are assured they won't have to pay penalties or interest.

Amnesties have worked in the past. People whose consciences were bothering them, or were afraid of being caught some day, chose the amnesty window to come clean. In 1985 a New Yorker sent in a check for $2.5 million to cover unpaid taxes. NY City collected $84 million from an FY 2004 amnesty; NY State collected $22 million from an amnesty the year before.

Mayoral spokesman Marc LaVogna advises that the Finance Department already has an amnesty program, but I could find no details on the www.NYC.gov/finance site or using Google.

Is a tax amnesty a good idea? I had to look into this while I was working for the NY City Comptroller  as chief economist in 1992-2006. Here's what I think:

1. Evidence from NYC's experience with payments for trips and falls suggests it's always a good idea to settle early and reasonably to avoid costly administrative expenses. So Speaker Quinn's idea of negotiating away some fines in return for early payment makes sense. But this is a case-by-case concept rather than a blanket amnesty.

2. Specifically, scofflaws outed in the Daily News should not be covered by a blanket amnesty. The jig is up for them. Delinquents already in the crosshairs of the Finance Department should perhaps qualify for individual concessions to speed up payment but not for a general one.

3. Amnesties offered frequently yield decreasing returns. Having had one in 2004, it may be too soon for the City to have another one. The City's current need for revenue, its potential increase in revenue and reduction in staff time, should be weighed against the loss of penalties and interest.

4. Amnesties have been known to be counterproductive, causing a reduction in compliance. Offers of amnesty should always be accompanied by an announced commitment to a higher level of enforcement after the amnesty window closes. Otherwise frequent amnesties create the danger of "moral hazard", perversely increasing the number of scofflaws. Fewer taxpayers might pay on time if they can count on there being frequent amnesties from penalties and interest.

BLOOMBERG | Cloning Himself

Nearly 30 years ago, Mayor Michael Bloomberg left Salomon Brothers (it was the recession of 1981-82), and he transformed his $10 million severance check and his Salomon shares into a giant company with more than 9,000 employees concentrated in the New York City area.

He had a hunch he could compete with the Reuters terminals and he was right.

Now he wants to clone himself so that in 30 years other people can look back and say: "My giant company got started in New York during the Decession (Repression?) of 2008-2010."

His new idea is one I hoped the Mayor would come round to. I said so last October in an Op Ed in City Hall News:

Today, the city has a once-in-a-generation opportunity to harness the energy of Wall Street entrepreneurs bursting with ideas as grand as Bloomberg's was in 1981, but who need partners to make their ideas a reality. Layoffs from the downsizing of Wall Street create a unique opportunity for talented displaced workers to start or partner in new businesses or social ventures. The displacement could help advance the Mayor's PlaNYC 2030 agenda by encouraging green entrepreneurs--profit-oriented or nonprofit, like Solar One and GreenEdge NYC--to make the Big Apple into the Green Apple.

When I wrote this less than five months ago, the latest estimate from Albany of the likely loss of New York's financial services jobs was 40,000. The estimate now is 65,000.

Mayor Bloomberg doesn’t pretend his plan will restore all 65,000 jobs. But his “guess” is that the small businesses could create 25,000 jobs. Last week a NY Times story by Patrick McGeehan describes the Mayor’s new plan, which is to

invest $45 million in government money to retrain investment bankers, traders and others who have lost jobs on Wall Street, as well as provide seed capital and office space for new businesses those laid-off bankers might create. The plan is intended to stem a potential exodus of banking professionals from the city during the restructuring of the financial services industry, which has been the city’s economic engine for decades, and to speed the industry’s recovery, which will take at least several years, officials said. Mr. Bloomberg recounted how he created his company in a rented 10-foot-by-10-foot room. He received no help from the city, but he said that was no reason not to help other entrepreneurs now.

The most tangible aspect of the plan is the creation of new incubators, one of them at 160 Varick Street, where he announced his new plan. The Varick Street building

will house an incubator for start-up companies that might employ laid-off professionals. Trinity Real Estate donated the space for three years and the Polytechnic Institute of New York University will select the entrepreneurs who will occupy the space, beginning in April. A second business incubator is scheduled to open in Lower Manhattan later in the year, said Seth W. Pinsky, the president of the city’s Economic Development Corporation. The agency plans to put $3 million into funds to make small investments in start-up companies, Mr. Pinsky said. He said that he hoped to attract twice as much money from private investors and that $9 million would be enough to help start hundreds of new businesses.

I spent the first half year after retiring from the Comptroller's Office in a business incubator in Manhattan and I have recently written about another one, Green Spaces in Brooklyn, as “Green Edge 14”. A report I worked on for the NYC Comptroller on the software industry in 1999 concluded that NYC needed more well-conceived incubators.

Successful incubators such as those that spawned the successes of Route 128 and Silicon Valley require energy from several sources. The MIT-Stanford model is based on a three-way fusion of energy from business entrepreneurs, government money and leadership, and university knowledge. Incubators in New York City that have petered out have usually lacked strong enough government support or university involvement.

My friend Professor Henry Etzkowitz calls the fusion of energy from the three sources in a well-functioning incubator the "Triple Helix" of innovation. If we are looking to clone financial entrepreneurs, it’s hard to think of a better DNA to work with than the Mayor’s.

DEPRESSION | Was the Fed the Cause? Or Property Speculation?

Friedman and Schwartz,
Monetary History of
 the U.S., 1963.

February 23, 2009–In the 1950s, the cause of the Great Depression was attributed simply to 1920s over-buying of real estate, with Florida as the poster state.

Subsequently, monetarist economists have put the blame on blunders by the Federal Reserve System, which was adrift after the death in 1928 of its able New York Bank President, Benjamin Strong.

Milton Friedman and Anna Schwartz demonstrated that the Fed was selling government securities instead of the more logical counter-deflationary action of buying them.

The Fed was therefore said to have taken liquidity out of the financial system and to have kept interest rates too high for recovery in the 1930s.

Making the Fed the culprit has contributed to a complacent feeling that the Fed knows so much now that the Depression couldn't happen again. The problems of the Japanese financial system since 1990 have been brushed off (e.g., by former Fed Governor Larry Meyer) as indicators that the Japanese response to a downturn was just too slow and too timid.

Polly Cleveland has recently reasserted the older version of the story, namely that the Depression was primarily a reaction to the 1920's real estate bubble. It began with the production of cars in 1899, which grew exponentially (with just a two-year interruption for World War I) until a peak of 4 million cars in 1929.

The auto suddenly opened up vast suburban and rural areas to housing. Developers—legitimate and bogus—leapt at the opportunity. Banks jumped in too, creating so-called "shoestring mortgages", effectively allowing property purchases on margin. Within a few years, tens of thousands of acres around major cities had been subdivided and sold. In rural areas, developers bought up farms, dug a pond, built a "clubhouse" and sold cheap "vacation" lots. As reported in Homer Hoyt's classic One Hundred Years of Land Values in Chicago, from 1918 to 1926, Chicago’s population increased 35 percent and land values rose 150 percent, or about 12 percent a year.

Land values tapered off in 1926, then fell. After 1929, home construction and car production collapsed. In Chicago, by 1933 land values had fallen some 70 percent overall; peripheral areas fell even more. U.S. auto production did not regain the 4 million level until 1949. Housing production did not pass the 1926 peak until 1950. Cleveland continues:

Around Detroit, more than 95 percent of recorded lots were vacant as of 1938. Nationally, the number of vacant lots rose to 20-30 million, compared with about 30 million occupied housing units. According to economic historian Alex Field, the barren subdivisions ringing the cities hindered the recovery of construction: Missing titles of defaulted owners and poor physical layout created de facto brownfields.

The real estate bubble helped set off and then worsen the Depression. Collapsing land values left people suddenly much poorer, so they cut spending. They also defaulted on mortgages, sticking the banks with "toxic" assets: liens on near-worthless property. The struggling banks in turn cut off lending even to good customers. Bank runs—panicky depositors withdrawing cash—further crippled the banking system.

Cleveland compares the innovation of the automobile with the innovation of collateralized debt obligations. Both started off innocently enough (securitization of housing debt was a good idea when properly monitored), but ended up setting off destructive real estate bubbles.

What we have found out is that the downside of the business cycle is not necessarily more under control than it was in the 1930s.

GAS PRICES | Why Rising While Crude Falls?

Feb. 21, 2009–I was wondering why gas prices have not fallen in line with the drop in the price of crude oil. It's a deepening global recession. Demand is dropping continuously, and crude oil prices have behaved as we expected. Why haven't retail prices dropped correspondingly? Instead, they have been rising. Is this perverse situation going to continue?

To answer the last question first, the Oil Price Information Service says that a disconnect between crude prices and gasoline prices will continue well into this year, with an average price of gas at the pump rising to $2.50 a gallon by early Spring. Prices are not expected to get back to the $4 per gallon level--at least not soon--but don't expect the price of gas to follow the decline in crude oil prices.

What's going on here? Price-gouging? An answer has been provided by the HEAT Zone blog on February 16, 2009 and I pass it on.

1. Refining activity has been cut back

Demand for gasoline in the U.S. began to drop at the end of 2008, as penny-pinching Americans drove less. Plummeting demand for gasoline, usually the most profitable petroleum product, led to refiners actually losing money as the wholesale price of crude purchased to manufacture gasoline actually cost more than the wholesale gasoline refiners were selling. When raw materials used to make a product cost more than that product, producers lose money. Wanting to minimize their losses, refiners cut back on gasoline production substantially, putting activity levels at their lowest point in 17 years, according to the Energy Information Administration. This supply reduction has succeeded in driving prices up 22 percent since December 30, 2008.

2. Different crude prices, different delivery systems

Oil prices are commonly reported as the price of West Texas International crude oil sold on the NYMEX (NY Mercantile Exchange). West Texas is a high quality crude that in the past has drawn a higher price than crude from the Middle East or Latin America. However, plummeting demand for petroleum products worldwide means huge supplies of West Texas oil are available, pushing the price of West Texas crude below other crude oils from around the world (such as North Sea Brent crude from the UK and light, sweet crude from Saudi Arabia). Because international crude has usually been cheaper than West Texas crude, American refineries are set up to receive crude by tanker and no domestic transport systems exist. Therefore refineries can’t easily switch to West Texas crude while it’s cheaper.

So now you know why gas prices at the pump are rising even though the price of crude oil we produce in West Texas is falling.

POST-2008 | Shift to Thrift

One of the joys of being interviewed in the mainstream media is you hear from friends with wise or witty reactions. I got a nice note from Dick Roberts about the NY Times quoting me in the Economists’ Forecast story yesterday:

Delighted that the Times saw fit to consult you. The photo adds authenticity.

Dick wrote a response to my somewhat bearish perspective on New York City. He could also have been responding to Ann Medlock's salute to the coming return to fashion of the forgotten virtue of thrift. After all, the only 2008 winners among Dow stocks are the two retailers, Wal-Mart and McDonalds, that cater to thrifty consumers.

Dick, who is my frequent summertime tennis partner, provides a warning about the excesses of thrift:

Since most of the issues confronting us have their analogy in tennis, consider the consequences of players, who feeling poor, play a few extra sets with a can of balls they would have discarded in more opulent times.

A seemingly innocuous bit of domestic thrift could have, alas, serious consequences:

Since the balls have less bounce, the players stretch too far and run too fast, leading to injuries, thereby imposing additional costs on insurers, Medicare, and personal savings. Result: diminished funds available to purchase consumer goods. Result: retarded growth in the US economy, reduction of imports. Result: acceleration of recessions in Asia, Europe, third world. Result: social unrest in Mideast, unemployment in China, possible regime changes in unstable countries. All for the want of a horseshoe nail. What can you and I and our spouses do to reverse this trend?

Dick's warnings are a stretch but I actually worked on a study of this kind at the NYC Comptroller's Office in 1995, on the "Net Loss" from some budget cuts. The study is likely to get dusted off by agencies facing cuts because of looming gaps in state and city budgets. Thank you Dick, for reminding me to flag the report!

U.S. SECURITY | Dennis Blair on Top Concerns

Feb. 16, 2009–Dennis Blair, Obama's director of national intelligence, told the Senate Intelligence Committee on Friday that based on reports from the nation's 16 intelligence agencies, the global recession is now the country's top security concern. Unrest overseas, he says, would be a threat worse than terrorism.

I interviewed Jim Burke of CBER, which tracks what institutional investors are doing. I have posted his comments on Huffington Post here.

NYC | Quinn's Fiscal Proposals

Speaker Christine Quinn is attempting to help solve NYC's fiscal problems by raising the rate of taxation of NYC's personal income tax (PIT) on incomes above $297,000, to 4.25 percent (from 3.65 percent), above $532,000 to 4.45 percent and above $1.2 million to 4.65 percent (i.e., a full percentage point increase). The current NY State top rate is 6.85 percent and this is also being considered for an increase.

The PIT surtax is estimated to raise $1 billion and I could be convinced that under current conditions the increase is fair and the brackets well chosen, because:
- NYC has to balance its budget. There are no easy solutions. Those who are high income earners are better able to weather the storm.
- Back in the early days of the Clinton Administration, New Yorkers earning more thsn $200,000 got hit with a surcharge. There was little complaint (New Yorkers voted for him with lop-sided majorities) and the economy recovered well from the recession that hit its lowest point in 1992.
- Anyone in the bracket above $297,000 knows that taxes paid to NYC are deductible from taxable federal income. So the tax is shared with Uncle Sam.
- It's very hard to find a tax that doesn't hurt NYC's competitive situation (the property tax, which is the best of the taxes to raise for competitive reasons, has already been increased), but at least high income earners know that NYC is a good business partner and is a good place to live.
- My friend the late Karen Gerard, former deputy mayor for economic development, once said that after her retirement from the city she worked out a way to save a Wall Street firm millions of dollars by moving to New Jersey. She expected the firm to move. Instead, its reaction was that he savings was "chump change". For many individuals, it would take more than a 1 percentage point increase in the NYC income tax to persuade them to move out of NYC.
- The only tax that doesn't affect the competitive situation of NYC is a tax on land.

On the other hand:
- There would be a competitive effect relative to Connecticut or New Jersey or upstate.
- The top bracket will be high for a city tax. Back in May 2000, when I was Chief Economist in the Office of the NYC Comptroller, we reported a top rate of 3.9 percent, the highest PIT rate for any city that also had a state PIT. Washington, DC had a PIT rate of 9 percent for incomes above $20,000 - but it has no state PIT.
- An increase in the NYC's income tax would have to be approved by the state legislature. Albany has a much bigger budget gap to close than NYC and doesn't have the property tax to fall back on.
- The NYC increase would be on top of whatever increases the state comes up with. The Daily News on Feb. 5 reported that the number of millionaires in New York appears to have dropped by 10 percent, from 48,984 people in 2008 to 44,165 in 2009. The lower Wall Street bonuses would account for much of the change. One proposal would raise the state income tax above the current 6.85 percent for those making $250,000 and above. Others would start at $500,000 or $1 million.
- Gov. Paterson said the last time a temporary tax was approved on the wealthy, in 2003, New York was coming out of a recession. "In contrast, at this point we have not found the floor of this budget deficit, and millionaires - however many of them are still left - can't pay a $48 billion deficit over three years."
- Assembly Speaker Sheldon Silver said there is strong support for hiking taxes on the wealthy, which could raise at least $1 billion. A state surcharge of 1 percentage point on top of Speaker Quinn's percentage point would bring top combined state-city PIT rates to 12.5 percent.
- A fairness issue can be raised based on what percentage of PIT are paid by what percentage of taxpayers. Back in 1997, only 5.5 percent of NYC's PIT filers had adjusted gross incomes (AGIs) of more than $100,000. Yet they paid 57 percent of the PIT.
- A NYC PIT surcharge will be paid mainly by Manhattan residents. In 1997, Manhattan residents accounted for fewer than one-fourth of resident PIT filers, but half of AGIs and 57 percent of the NYC resident PIT tax liability.
- Nonresidents continue to get off lightly. They earned in 1997 on average twice the incomes of NYC residents, and accounted for 37 percent of the earnings of NYC workers, yet they paid only 7 percent of the PIT. Since then, the commuter tax has been eliminated.

Speaker Quinn has also assembled four proposals to help small businesses: Streamlining the permit and licensing process, waiving for 12 months permit and license fees and developing neighborhood marketing campaigns, requiring city agencies to review the effects of new regulations affecting small businesses, and offering commercial kitchen space “at a reasonable fee” to 60 start-up food manufacturers.

Three other proposals are designed to improve municipal efficiency: Merging city agencies with similar or overlapping functions, consolidating the Board of Education’s Retirement System into the general city pension system, reducing “unnecessary administration costs”, and reducing spending on municipal recruitment programs that currently cost the city $30 million a year.

Two proposals relate to R&D and training in the medical and biotech areas: Creating an annual four-year tax credit of up to $250,000 for research and development, facilities and staff training in the area of biotech, and training more nurses by linking experienced nurses to health-care-education programs at the City University of New York.

The remaining four proposals don't fit in any of the above areas: Purchasing the .nyc domain name for New York City businesses, organizations and residents; raising penalties for those who commit gang initiation crimes; creating a one-time amnesty program for those with outstanding violations to pay portions of fines; and improving the referrals of New Yorkers at risk of losing unemployment benefits to public programs like food stamps or Medicaid.

None of Speaker Quinn's smaller proposals would have anything like the fiscal impact of the surtax on personal incomes.

NYC and NY State Stimulus Details

NY Gov. David Paterson and Sen. Charles E. Schumer (D-NY) held a conference call about the NY State share of the American Recovery and Reinvestment Act aka the stimulus package. According to the NY Times, the anticipated aid will bring more than $21 billion into the state, would close much of the city’s $4 billion budget gap and would significantly narrow the state’s $14 billion deficit. But Gov. Paterson warned that the state deficit was widening by the day.

Details that follow are abbreviated from Sen. Schumer’s website.

By some estimates, the package will create 215,000 new jobs in New York alone, while preventing layoffs of thousands more. "This is one of the first bills where New York gets more back from the federal government than we have put in," said Schumer.

FMAP
$12.6 billion boost in Federal Medical Assistance Percentage (FMAP) for New York over the next nine quarters. Currently, Medicaid is funded using a formula that determines how much the federal government contributes and how much the state is obligated to pay for Medicaid services. In New York, the federal government covers just 50 percent of Medicaid costs. New York is one of eleven states that divide the remaining bill between the state and the counties, putting a massive burden on county budgets. As a result of this, Upstate New York counties expect to pay $1.580 billion in Medicaid expenses this year. Because New York counties are faced with such a large share of Medicaid expenses, a portion of the FMAP boost for New York would go directly to the counties. So of the $12.6 billion, $8.6 billion will go to the state, $2.8 billion to New York City, $929 million to counties in Upstate New York and $262 million to Long Island.

EDUCATION AID

$2.72 billion for the State Fiscal Stabilization Fund to prevent massive cuts to education. New York spends approximately one-third of all tax revenue on education. All states, including New York, face massive budget deficits due to declines in the tax base. This funding will help make up that difference and prevent teacher lay-offs, cuts to education and property tax increases.

$800 million for Special Education Part B State Grants/IDEA to help educate individuals with disabilities. The federal government currently funds IDEA at only 17 percent. This money will significantly increase the federal share for special education funding.

$1 billion for Title I of No Child Left Behind. No Child Left Behind has been chronically underfunded, which means schools have had to live up to the demands of NCLB without the resources to do so. This funding is a much needed injection of funds to help schools meet the requirements of NCLB.

INFRASTRUCTURE

$87.5 million through the Drinking Water State Revolving Fund to address the backlog of drinking water infrastructure needs

$439.2 million through the Clean Water State Revolving Fund to address the backlog of clean water infrastructure needs

$1 billion in Highway Funding to be used on activities eligible under the Federal-aid Highway Program’s Surface Transportation Program and could also include rail and port infrastructure activities at the discretion of the states.

$1.3 billion in Mass Transit Funding for investments in mass transit.

COLLEGE TUITION TAX CREDIT

A new tax credit for tuition of $2,500 - a significant improvement over current tax benefits to families with children in college. For families that receive some benefit now from either the HOPE credit or the tuition deduction, the maximum benefit per student will increase by 39 to 317 percent, depending on the family's circumstances. Additionally, tens of thousands of families that receive no tax benefit today will be eligible for a refundable credit of up to $1,000.

FOR SENIORS & FAMILIES TO WEATHERIZE THEIR HOMES:

More than $403 million in weatherization funds for New York seniors and families to help reduce their sky-high home heating costs and create thousands of new jobs. This investment will save families up to $800 each on their utility bills and will create approximately 30,000 jobs in New York alone. It will also make New York more energy efficient and begin to reduce our dependence on volatile foreign sources of energy.

FOR LAW ENFORCEMENT

$96 million in COPS grants to hire and rehire local law enforcement officials. Schumer fought to make sure this funding was included in the bill so that local police departments could afford to maintain current staffing levels or hire new officers to combat rising crime.
$166.3 million in Byrne/JAG grants, which provide flexible funding to local police departments to support a variety of law enforcement efforts.

TAX BREAKS FOR NEW YORK FAMILIES

Up to $400 for individuals and $800 for married couples for the Making Work Pay Tax Credit, $250 to Social Security beneficiaries, SSI recipients, and disabled veterans.

$7,500 to $8,000 for the Improved Homebuyer Tax Credit for first-time homebuyers who purchase a home from the date of enactment through at least July, 2009. New homebuyers will no longer have to pay back the credit as required under current law. The exact amount of the credit is still under negotiation.
$2,500 for the College Tuition Tax Credit (an increase in the tax credit for higher education and allowing the credit for four full years)

3,142,000 NY taxpaers protected from the Alternative Minimum Tax, based on an estimate of the Congressional Research Service for 2009. Nationally, 26 million working families protected from the Alternative Minimum Tax, representing thousands of dollars in additional income taxes per family.

HOUSING

$4 billion nationally through the Public Housing Capital Fund to enable local public housing agencies to address a national $32 billion backlog in capital needs – especially those improving energy efficiency in aging developments – in this critical element of the nation’s affordable housing infrastructure. Of this amount, NYC will receive $390 million.

$251 million in HOME Funding to enable state and local government, in partnership with community-based organizations, to acquire, construct, and rehabilitate affordable housing and provide rental assistance to low-income families

$142.1 million through the Homelessness Prevention Fund to be used for prevention activities, which include: short or medium-term rental assistance, first and last month’s rental payment, or utility payments. As such, most of this funding will go directly into the economy of local communities, as the funds will be used to pay housing and other associated costs in the private market

$98 million for Community Development Block Grants, flexible grants that provide communities with resources to address a wide range of unique community development needs.

$51 million for the Neighborhood Stabilization Program, a program that provides funding for communities to redevelop demolished or vacant properties and purchase and rehabilitee foreclosed homes for resale. This grant program will endow Upstate New York communities with the funds needed to finally tackle the growing vacant housing problem that drives down property values and contributes to neighborhood blight.

Blair Warns of Economic Unrest

Dennis Blair, Obama's director of national intelligence, told the Senate Intelligence Committee yesterday that the global recession could create unrest overseas that would be a threat worse than terrorism. He said:

“The longer it takes for the recovery to begin, the greater the likelihood of serious damage to U.S. strategic interests.

In other words, we can expect the Global Peace Index - the Dow-Jones of world peace - to take a hit. Just to start with the first name on the list, the most peaceful country in the world in mid-2008 was Iceland, which has seen all three of its major banks become insolvent.

Iceland replaced Norway as #1 in both the Global Peace Index and the UN's best-place-to-live table of 177 countries, based on health care, life expectancy, per-capita income and education.

With a population of barely 300,000, Iceland has an admired free health and education system. It buys the most books per capita and the most mobile telephones, and it has the highest proportion of working women in the world.

But Iceland's banking system has liabilities of more than $100 billion, a huge amount for a country with a GDP of $14 billion.

Iceland certainly over the long run qualifies as a peaceful country, since it gave up its armed forces 700 years ago.

But at the end of November, Iceland's citizens assembled to call for the government to resign, and at least five people were injured. The krona’s value was cut in half following a banking crisis that started in October. One-third of the population is at risk of losing their homes and savings.

Global Peace Index Rankings

The table below provides the 2008 GPI rankings for the 140 countries analysed in that year and the 121 countries analysed in 2007, as well as year-on-year comparison. Countries most at peace are ranked first. A lower score indicates a more peaceful country. You can click on a country to see the detail of its peace indicators and drivers.

Global Peace Index 2008 http://www.visionofhumanity.org/gpi/results/rankings.php
• Compare
• 2007
• 2008
Country
Rank
Score
Iceland1
1.176
Denmark
2
1.333
Norway
3
1.343
New Zealand
4
1.350
Japan
5
1.358
Ireland
6
1.410
Portugal
7
1.412
Finland
8
1.432
Luxembourg
9
1.446
Austria
10
1.449
Canada
11
1.451
Switzerland
12
1.465
Sweden
13
1.468
Germany
14
1.475
Belgium
15
1.485
Slovenia
16
1.491
Czech Republic
17
1.501
Hungary
18
1.576
Chile
19
1.576
Slovakia
20
1.576
Uruguay
21
1.606
Netherlands
22
1.607
Hong Kong
23
1.608
Romania
24
1.611
Oman
25
1.612
Bhutan
26
1.616
Australia
27
1.652
Italy
28
1.653
Singapore
29
1.673
Spain
30
1.683
Poland
31
1.687
South Korea
32
1.691
Qatar
33
1.694
Costa Rica
34
1.701
Estonia
35
1.702
France
36
1.707
Vietnam
37
1.720
Malaysia
38
1.721
Latvia
39
1.723
Ghana
40
1.723
Lithuania
41
1.723
United Arab Emirates
42
1.745
Madagascar
43
1.770
Taiwan
44
1.779
Kuwait
45
1.786
Botswana
46
1.792
Tunisia
47
1.797
Panama
48
1.797
United Kingdom
49
1.801
Mozambique
50
1.803
Laos
51
1.810
Cyprus
52
1.847
Zambia
53
1.856
Greece
54
1.867
Gabon
55
1.878
Argentina
56
1.895
Bulgaria
57
1.903
Tanzania
58
1.919
Nicaragua
59
1.919
Croatia
60
1.926
Libya
61
1.927
Cuba
62
1.954
Morocco
63
1.954
Equatorial Guinea
64
1.964
Jordan
65
1.969
Bosnia and Herzegovina
66
1.974
China
67
1.981
Indonesia
68
1.983
Egypt
69
1.987
Paraguay
70
1.997
Senegal
71
2.011
Kazakhstan
72
2.018
Malawi
73
2.024
Bahrain
74
2.025
Syria
75
2.027
Rwanda
76
2.030
Namibia
77
2.042
Bolivia
78
2.043
Albania
79
2.044
Peru
80
2.046
Burkina Faso
81
2.062
Dominican Republic
82
2.069
Moldova
83
2.091
Ukraine
84
2.096
Serbia
85
2.110
Bangladesh
86
2.118
Macedonia
87
2.119
Mongolia
88
2.155
El Salvador
89
2.163
Brazil
90
2.168
Cambodia
91
2.179
Cameroon
92
2.182
Mexico
93
2.191
Belarus
94
2.194
Papua New Guinea
95
2.224
Jamaica
96
2.226
United States of America
97
2.227
Trinidad and Tobago
98
2.230
Mali
99
2.238
Ecuador
100
2.274
Azerbaijan
101
2.287
Turkmenistan
102
2.302
Guatemala
103
2.328
Honduras
104
2.335
Iran
105
2.341
Yemen
106
2.352
India
107
2.355
Saudi Arabia
108
2.357
Haiti
109
2.362
Angola
110
2.364
Uzbekistan
111
2.377
Algeria
112
2.378
Philippines
113
2.385
Uganda
114
2.391
Turkey
115
2.403
South Africa
116
2.412
Congo (Brazzaville)
117
2.417
Thailand
118
2.424
Kenya
119
2.429
Mauritania
120
2.435
Ethiopia
121
2.439
Cote d'Ivoire
122
2.451
Venezuela
123
2.505
Zimbabwe
124
2.513
Sri Lanka
125
2.584
Myanmar
126
2.590
Pakistan
127
2.694
Democratic Republic of the Congo
128
2.707
Nigeria
129
2.724
Colombia
130
2.757
Russia
131
2.777
Lebanon
132
2.840
North Korea
133
2.850
Central African Republic
134
2.857
Chad
135
3.007
Israel
136
3.052
Afghanistan
137
3.126
Sudan
138
3.189
Somalia
139
3.293
Iraq
140
3.514

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NAACP | Happy 100th Birthday (Updated July 7, 2016)

This illustration shows the veneration of Lincoln shown by those
celebrating the end of slavery in the United States.

Feb. 12, 2009–Today is the 200th birthday of Abraham Lincoln and also the 100th birthday of the NAACP.

Its founding was first scheduled for February 12, 1909, as a mark of respect for Lincoln.

For the same reason, this is considered the NAACP's birth date even though the meeting that actually created the organization was postponed to May 30, 1909.

Billed as a conference of the Niagara Movement, the meeting was held in New York City's Henry Street Settlement House.

The Founders of the NAACP

The 40 people in attendance called themselves at first the "National Negro Committee". Harvard Professor W. E. B. Du Bois helped organize the event and presided over it. One year later, at its second conference, the membership renamed themselves the National Association for the Advancement of Colored People.

The first officers, as reported by Mary White Ovington, were:

- National President, Moorfield Storey, Boston
- Chairman of the Executive Committee, William English Walling
- Treasurer, John E. Milholland and Disbursing Treasurer, Oswald Garrison Villard
- Executive Secretary, Frances Blascoer
- Director of Publicity and Research, Dr. W. E. B. DuBois.

John E. Milholland, the NAACP's first Treasurer, was a Presbyterian from New York City and upstate Lewis, NY. He was a Lincoln Republican, with pride in his party's having abolished slavery and championed votes for all men regardless of color at the end of the Civil War. Milholland continued to champion the rights of black Americans to his death in 1926, long after his Republican party had ceased to care–the last election in which Republicans campaigned more aggressively than Democrats for progressive ideas like human rights was 1912.

Milholland's daughter Inez (who married my mother's uncle Eugen Boissevain) followed in her father's footsteps. She insisted that a delegation from Howard University be allowed to march in the 1913 woman suffrage parade in Washington. She died in 1916 after exhausting weeks on a whistle-stop tour of the west, campaigning against President Woodrow Wilson for not supporting the right of women to vote.

At a memorial for Inez in 1924, her father complained publicly about the absence of black people on the program, which was put together by the National Woman's Party.

On the centennial of their founding, the NAACP called for equity in distribution of stimulus funds.

BRANDS | Life and Death of Multinationals

My friend Michael Phillips sent an email today expressing scepticism about the awesome power of the "big global companies". He argues that despots like Mao, Stalin, Castro, Chavez, Ho Chi Minh and Kim Jong-il are much more durable. He refers back to a list he says he was the first to post on the Internet– the top 100 global companies in 1960. He compares that list to the top global companies in 2008.

Only eleven companies are on both lists. Another only has the same name (AT&T is not the same continuous company) and two of the eleven are about to collapse (Ford, GM). Four from the 2008 list are already out of business (Citigroup, Bank of Scotland, Merrill Lynch and Volkswagen).

So, he says, we have more to fear from dictators than multinationals. Dictators have the power to use weapons that with proliferation are becoming more dangerous.

Of the top hundred global companies today, among these ferocious demonic monsters, only eleven will still exist when today's 20 year-olds are retiring. Big global corporations are best compared to orchids, delicate hot house plants. They come and go, mostly go. Fear of big global companies is not a rational fear.

Food for thought. We should be enlisting multinational corporations in the cause of nonproliferation and peace. Nuclear weapons in the hands of rogue states can't be good for most businesses.

Turkey's Economy - Action Needed Now

Having traveled to Istanbul three times in the last two years, I'm interested in how the Turkish economy is bearing up. I emailed a Pace University MBA graduate, Filiz Bakirhan, who was both a student of mine and an intern at the NYC Comptroller's Office, and now lives in Turkey. I asked her for an update on the economy.

She reports that Turkey is affected deeply, like so many other countries, by the financial crisis that stems from U.S. subprime mortgage problems beginning in 2007. She says:

By the third quarter of 2008, Turkey’s economy was seriously affected and the crisis is expected to worsen in 2009. Global production and trade has decreased sharply. Many sectors in Turkey with difficulty refinancing their short-term debts. Some companies have gone bankrupt even with strong sales. Credit problems have contributed to an increase in the unemployment rate to 10.9% in October 2008 from 9.7% in 2007. Consumers have decreased their spending because of the economic insecurity.

Apparently Turkey has been slower to take action than other countries. Turkey’s AKP (Justice and Development Party) has not introduced its own stimulus package, and faces local elections next month. Businesses are looking for tax incentives or tax reductions.

Payroll taxes are high and payroll tax cuts would lower the barriers to hiring workers from the unregistered economy. Businesses are also hoping the government will increase public spending to spur demand. Some also urge the government should restructure its tax sources to raise more revenue from taxes on land. In Turkey, many people are squatters and pay no taxes on land. But a series of Turkish governments have sought votes from squatters by giving them rights.

What has Turkey done so far? Filiz says it has taken one concrete action:

On January 15, the Turkish Central Bank cut its interest rate to 13% from 15%. Although the Turkish Lira has lost almost a quarter of its value in 2008, Turkish commentators think that it is presently secure.

In addition, the government has been negotiating with the IMF:

Turkey’s previous three-year $10 billion standby loan deal expired in May. A new agreement is expected to be for 18-24 months and includes financial support in the $20-25 billion range. Some economists believe that an IMF deal won’t be finalized until after the March elections and in any case won’t affect the situation greatly because the IMF money won’t be enough. But the new deal might boost confidence in the market and help the non-financial sectors recover their debts.

Is this enough? Filiz says no:

The AKP needs to give Turkey a stimulus package including tax reduction and public spending as well as a new IMF agreement, before next month’s elections.

HUFFPOST | Editors Talk

Feb. 7, 2009–Behind HuffPost are lots of people, not just (surprise) Arianna Huffington. Four of them were on offer at the 92nd Street Y in Manhattan February 5.

The panel discussion is billed as giving the lowdown on "How they choose the stories that make the news" and "their insights into blogging, including what blogs they link to and why, what content gets blogs noticed, the best practices for community building and quick tips for making blogging more empowering, profitable and fun."

Roy Sekoff. My photo.

The MC is Editor Roy Sekoff, shown at left. With him are Senior News Editor Katharine Zaleski, Senior Blog Editor Colin Sterling and Columnist-Reporter Jason Linkins. If you’ve never clicked on the "About Us" button on HuffPost, here’s the editorial staff lineup (the business side is another world). The four speakers are shown in bold:

Co-Founder & Editor-in-Chief: Arianna Huffington
Chief Executive Officer: Betsy Morgan
Editor: Roy Sekoff
Political Editor: Thomas B. Edsall
Senior Editor: Willow Bay
Senior News Editor: Katharine Zaleski
Senior Blog Editor: Colin Sterling
National Editor: Nico Pitney; Senior Features Editor: Katherine Thomson
Senior Style Editor: Anya Strzemien; Media Editor: Danny Shea
Business/Green Editor: Dave Burdick; Living Editor: Verena von Pfetten;
World Editor: Hanna Ingber Win; Chicago Editor: Ben Goldberger;
Washington Editor at Large: Hilary Rosen; Night Editor: Marcus Baram
Associate News Editors: Nicholas Graham, Nicholas Sabloff
Associate Video Editor: Patrick Waldo
Associate Editor, Citizen Journalism: Matt Palevsky
Associate Blog Editors: David Flumenbaum, Katherine Goldstein, David Weiner, Whitney Snyder
Reporters: Ryan Grim, Jason Linkins, Sam Stein
Community Manager: Katie Saddlemire
Editor at Large: Nora Ephron

Roy has a challenge as MC. The crowd has struggled in from a dark, icy-cold, windy night. Roy is well tanned, obviously just flown in from the LA sun and zephyrs. He’s breezy himself and used to taking control of the house. However, his first couple of warmup jokes fall flat on a sullen audience of 100 or so earnest New Yorkers, God’s frozen people. My take is they resent he hasn’t been suffering with them the bitter NYC weather. Think: Jovial American journalist covering the 900th day of the Siege of Leningrad.

In fairness to audience members, they not only braved the cold but paid $27 plus round trip fares, in a deepening recession. Not even relatives got in free. Roy starts in about the blogger tone being “more personal than the typical news story, something you would write to a friend.” If they could have text-messaged him in real time it would have been: "Pls LA guy speed up."

Roy does step up the pace and we find out why he has a rep for very hard work on the nuts and bolts of the HuffPost operation. He's the Founding Editor, been with HuffPost since it opened in May 2005. Katharine Zaleski also, we find out, came on the same month. Roy came to HuffPost via Film School and a job with Michael Moore, where he honed his skills as a champion of the progressive POV. He was hired by Arianna before HuffPost opened. He speaks a lot about Arianna, how she gets the word out during her travels, how she serves as a sounding board, how she listens because she is interested in everything. Roy has a huge job serving as the cable-bridge between Arianna and her e-empire.

The panel is mightily impressed by the rapid growth of Twitter. Users can send only Tweets of fewer than 140 characters. Great time-saver for the reader. Except that maybe the number of Tweets will just rise. I do a Google search and find Twitter users exceed 200,000 per day, firing out 3 million Tweets – a mind-blowing average of 15 Tweets per Twit. It's like the invention of the machine gun. No one is safe any more.

Google search tells us global blogposts were 1.6 million in 2006 but have grown so fast that in 2008 Japan alone has that many. MySpace page views are 1.5 billion per day. Facebook is growing by 600,000 users per day. Stunning.

Katharine Zakeski. My photo.

Katharine Zaleski is News Editor and the most decorative of the four panelists. She is in the eye of the storm in HuffPost's NYC operations where the news is edited. She notes that almost all readers used to get to the site via the "front door" – the home page (www.huffingtonpost.com) - but now 60 percent of readers get to HuffPost via links direct to a story from a search or Digg or a blogpost.

She says the nature of news coverage has been transformed by the Internet. Old model: News reporter looks for a scoop or a new angle, files story, goes to bed. People would get the news in the morning. Television shortened the lag. All-news radio shortened it some more. New model: Delays in reporting important news are down to minutes. The amount of related content that can be offered soon becomes gigantic. Katharine says her job is "to latch onto a breaking story and then stay with it" through the day or night. She works through the night when important stories are breaking. When news about Eliot Spitzer having meetings with a female in Washington, HuffPost for a while "owned" the story of the collateral damage to Ashley Alexander Dupree, by having more new information on Ashley’s music and career than anyone else.

Katharine waves off reports of antagonism between the main stream media and the blogsites. The two are complementary. A good major story on HuffPost, she says, is inclusive, with lots of links to the msm. Sure, HuffPost

depends on the newspapers. The papers also benefit by their content being promoted on the blogs. The great newspapers are using the Internet, adding online news sites with comment boxes, frequent updates and blogs. Same with television,

though she opines that CNN is just 10 percent dependent on the story, with 90 percent of the value in the production.

At question time, Katharine’s mother Caroline, sitting near HuffPost blogger Blake Fleetwood, asks a question anonymously. Katharine mercilessly outs her Mom. But Mom is unflappable. You can see where Katharine gets her poise.

Jason Linkins, Colin Sterling. My photo.

Jason Linkins is the third panelist. He writes "Eat the Press", and was rated one of the five funniest bloggers by Comedy Central. He says HuffPost has 3,000 bloggers. When the final numbers were in on election night, the TV commentators were saying goodbye to one another and their audiences. That's one concept, says Jason, that would never occur to a blogsite. The stories keep rolling in – Rod Blagojevich, Bernie Madoff, who knows what next? He says that the job of bloggers is to "kneecap people who screw up."

So far as "tone" goes, Jason says he got there by trial and error. He started out to be a marine biologist and swam his way into the new medium.

Colin Sterling, Senior Blog Editor, is the final speaker. He is introduced as Harry Potter and you can judge the likeness for yourself. He says he tries to make HuffPost authoritative by including links, and more Google-able by adding enough tags. Colin's most embarrassing moment, he says in answer to a question from the by-now engaged audience, was when he posted a skeptical view of global warming. He's a graduate of UCLA and was like Roy working for Arianna before HuffPost was created.

By the end of the evening, the crowd is happy. Frankly, they didn't get everything promised in the promotion, but who cares? They got $27 worth of information and some entertainment as a bonus. If they need more, they can buy the $15 book on sale in the lobby, The Huffington Post Complete Guide to Blogging. Now I'd dearly like to go to a panel featuring the business side of HuffPost, i.e., the rest of the masthead that keeps the brand afloat and valued last year in the $40-$200 million range.