Wealth Tax Would Have Increased Anti-Semitism in 20th-Century Tycoons, Stifled Ford Philanthropy, Clinton Economist Says
Former Clinton Treasury Secretary Lawrence Summers this week railed against the so-called “wealth tax” proposed by progressive Democrats, warning that such “anti-business” policies could have provoked more anti-Semitism from 20th-century business leaders.Speaking at The Peterson Institute for International Economics, Summers argued, “there are better ways to be much more progressive” than a wealth tax similar…
Former Clinton Treasury Secretary Lawrence Summers this week railed against the so-called “wealth tax” proposed by progressive Democrats, warning that such “anti-business” policies could have provoked more anti-Semitism from 20th-century business leaders.
Speaking at The Peterson Institute for International Economics, Summers argued, “there are better ways to be much more progressive” than a wealth tax similar to those proposed by 2020 Democratic presidential candidates Elizabeth Warren and Bernie Sanders. He compared their campaigns’ redistribution proposals to the failed 1972 presidential run of George McGovern, and challenged liberals to see that a wealth tax could backfire and increase corporate lobbying to groups such as the NRA.
Summers claimed a wealth tax would have promoted anti-Semitism in wealthy 20th-century business tycoons such as Henry Ford and kept them from creating massive philanthropic projects such as the Ford Foundation.
“Forcing the wealthy to spend could boomerang. If the wealth tax had been in place a century ago, we would have had more anti-semitism from Henry Ford and a smaller Ford Foundation today,” Summers, who is President Emeritus of Harvard University, remarked on Twitter Saturday.
The former World Bank economist and Director of former President Barack Obama’s National Economic Council also called for a “distinction between wealth and permanent income.”
Summers repeatedly stated he doesn’t believe today’s political power problems involve massive personal contributions from wealthy donors, positing that America’s super wealthy will simply move money to their family members and like-minded political groups should they be pressured by the government. He said wealth inequality has very little to do with political power and would ultimately hurt investment in lower or middle class efforts.
During the 1920s and 1930s in which Ford became an international business tycoon, he used newspapers to promote anti-Semitic conspiracy theories such as TheProtocols of the Elders of Zion. Summers, who is Jewish, touted the Ford Foundation for “famously identifying” the end of a bull market in 1969 and encouraging non-profits to invest more equity in endowments than in debt. He compared that move to the “big wave of enthusiasm of this kind just before the NASDAQ bubble burst in 1999.”
Back on Twitter, Summers compared Warren and Sanders to McGovern’s campaign against Republican Richard Nixon in 1972: “[McGovern] later regretted his anti-business tone and lost badly to Nixon, the past President who most resembles Trump…The campaign proposals that the wealth tax reminds me most of are George McGovern’s–with the same kind of redistribution emphasis which didn’t work for progressive cause as it led to Richard Nixon’s re-election,” Summers warned.
Much of Summers’ commentary took place at the PIIE conference last week entitled, “Combating Inequality: Rethinking Policies to Reduce Inequality in Advanced Economies.” At the beginning of the talk, also attended by the University of California, Berkeley’s Emmanuel Saez, The Washington Post’s Catherine Rampell quipped, “I was warned this could turn into a street brawl,” before asking, “Should we think about redistribution as a means to an end or an end in and of itself?”
Summers argued donations to the National Rifle Association and corporate lobbying would not be affected by a wealth tax, “none of which is addressed by the wealth tax … when you make the government a significant owner of companies, to what extent will the government intrude into the companies?”
“I do not think that a focus on wealth inequality as a basis of a more just society is terribly well designed, first, the arguments around political power have almost no validity, the truth is you can become one of the most powerful money people around the Dem or Rep Party for 4 or 5 million dollars a year,” Summers said at the PIIE conference.
“Nothing in this world is going to stop the wealthiest people in America from coming up with a vast multiple of 4 or 5 million dollars a year,” he added in a tone of futility. “Wealth inequality is a highly problematic basis for judging a society.”
In perhaps Summers’ most applauded remark on social media Saturday, he acknowledged: “Lack of income growth and opportunity for middle class families is a fundamental problem in American society. So too is rising inequality.”
Sanders campaign speechwriter David Sirota rebuked Summers’ commentary, “Wait, your argument is that we can’t have a wealth tax because Henry Ford was an anti-semite?”
On Fox News last week, economist Peter Morici argued that $50 million was not a lot of money to the top venture capitalists and corporate founders, saying Warren’s plan would hurt trickle-down investment.
“These are absurd rates. You have to remember these are the people who finance our startups, these are the people who give us companies like Amazon and Apple. They’re the ones with the seed capital,” Morici said. “[Warren’s campaign] acts like these people clip coupons, and they have bonds, and they hang out with the president and that’s simply not true. They’re very active people who are investing their money.”
Fans Celebrate #HOV50 and Share Favorite Jay Z Lyrics on Music Mogul’s 50th Birthday
In honor of Jay-Z’s 50th birthday, fans all across the globe flooded social media with warm messages of love and support.The hashtag #HOV50 began to trend early in the morning on Twitter on Wednesday as a result of the many well wishes from the longtime rappers’ fans.Fans opened up on some of their most memorable…
In honor of Jay-Z’s 50th birthday, fans all across the globe flooded social media with warm messages of love and support.
The hashtag #HOV50 began to trend early in the morning on Twitter on Wednesday as a result of the many well wishes from the longtime rappers’ fans.
Fans opened up on some of their most memorable moments involving the music mogul—whose birth name is Shawn Carter but is commonly referred to by fans as Hov, short for Hova. They also posted messages of the many ways Jay-Z has inspired them, including with hundreds of photos, gifs and video clips of him in action.
Many people used the Brooklyn native’s birthday to reflect on his work over the last three decades, listing their favorite albums, songs and guest features from the rapper.
Album rankings weren’t the only way fans recognized Jay-Z on his 50th birthday. Several people took to Twitter to commemorate the award-winning lyricist by sharing their favorite verses ever rapped by him. Classic Jay-Z lines from chart-toppers like “Hard Knock Life,” “Song Cry,” “Say Hello,” and his guest feature on Kanye West’s “Diamonds From Sierra Leone” were spotted on Twitter timelines.
Meanwhile, some fans said they’d celebrate Jay-Z’s birthday by listening to his lengthy discography all day long.
Jay-Z made listening to his catalog a whole lot easier for some of his fans when he re-released his entire catalog of music again on Spotify.
The Roc Nation founder removed much of his work from the platform in April 2017 to the dismay of many loyal listeners just ahead of the release of his latest album, 4:44.
At the time the move seemed like a ploy to get fans to subscribe to TIDAL, the music streaming service he owns and operates. Now, Spotify users will get to listen to all of Jay-Z’s albums and songs ranging from his 1996 debut Reasonable Doubt and so-called career retirement project The Black Album in 2003, his 2011 Watch the Throne collaboration album with West and several other staples.
Since he first emerged on the rap scene in the 1990s, fans have admired and praised Jay-Z for his many punchlines, thought-provoking lyrics and masterful storytelling. A natural wordsmith, he has kept listeners fascinated and moved with his ability to flow over a beat with grace and pizzaz—not to mention the fact that he creates hit after hit without writing his lyrics down.
It’s a long-known fact Jay-Z doesn’t write his albums but rather hits the studio with a few words already in mind before he jumps on a track. That habit sparked a number of younger singers and rappers following in his footsteps by not pre-writing lyrics to their songs.
“It just felt better [the way I do it now],” he said during a 2007 interview withMTV News. “In my mind, I said, ‘OK, I’m gonna sit down and I’m [going to] just write it and really do this thing a certain way.’ But your natural process is your process. It’s difficult to go back to what you was doing when you was 15, 16 years old. My process is different now. It sounds great on paper, like ‘I’m [going to] sit down, I’m going to write the entire album like I did before.’ But once you get back in the studio and you’ve been doing this process for years and years now, so it just felt natural to do it the way I’ve been doing it: no paper, no pen, just listen to the music.”
See more of how fans are celebrating Jay-Z’s birthday below.
Retired Colonel Warns That North Korea Firing Missiles on Thanksgiving Is ‘No Coincidence,’ Criticizes Trump Rhetoric
Retired U.S. Army Colonel Jack Jacobs warned that North Korea’s reported firing of two missiles on Thanksgiving was “no coincidence,” while criticizing President Donald Trump’s claims that the Asian nation will give up its nuclear weapons.South Korea’s military reported that two “short-range” projectiles were fired from what was believed to be “a super-large multiple rocket…
Retired U.S. Army Colonel Jack Jacobs warned that North Korea’s reported firing of two missiles on Thanksgiving was “no coincidence,” while criticizing President Donald Trump’s claims that the Asian nation will give up its nuclear weapons.
South Korea’s military reported that two “short-range” projectiles were fired from what was believed to be “a super-large multiple rocket launcher” on Thursday. The missile test would mark the 13th such action by North Korea since May, despite repeated claims by Trump that the country’s dictator, Kim Jong Un, plans to cooperate with the international community and denuclearize.
Asked during an interview with MSNBC if it was a coincidence that North Korea carried out the test on Thanksgiving, Jacobs argued that was definitely not the case.
“No, there’s no coincidence,” the retired colonel, who received the Medal of Honor for his actions in the Vietnam War, said. “Symbolism is very big for Kim. Look, it’s business as usual in North Korea. North Korea’s a continuing criminal enterprise. It’s not going to give up its nuclear weapons, it’s not going to [dis]continue testing delivery systems despite rhetoric, particularly what came from the White House during this administration,” he added.
“They’re going to continue doing what they’re doing and nothing is going to change. North Korea is not interested in giving up its nuclear weapons,” Jacobs asserted.
Trump, as Jacobs noted, has repeatedly insisted that North Korea will curb its nuclear program and alter its provocative behavior, despite the disagreement of leading foreign policy experts and the assessment of U.S. intelligence agencies. The president has met with Kim directly on multiple occasions, becoming the first sitting U.S. head of state to do so. Trump also became the first sitting American president to step foot into North Korea earlier this year in late June.
Nonetheless, North Korea has failed to take any serious steps to denuclearize and has steadily increased missile tests over the past few months. In a controversial tweet on November 17, Trump responded to North Korea calling Democratic presidential candidate Joe Biden a “rabid dog.”
“Mr. Chairman, Joe Biden may be Sleepy and Very Slow, but he is not a ‘rabid dog.’ He is actually somewhat better than that, but I am the only one who can get you where you have to be,” Trump tweeted, directing the post at Kim. “You should act quickly, get the deal done. See you soon!”
But North Korean Foreign Ministry adviser Kim Kye Gwan dismissed the president’s remarks the next day, saying that the Asian nation was no longer interested in discussions regarding its nuclear program.
“I interpreted President Trump’s tweet on the 17th to signify a new DPRK-US summit” but “we are no longer interested in these meetings that are useless to us,” Kim said in a statement published by North Korea’s state news agency.
“We will no longer give the U.S. president something to boast about for nothing in return, and we must receive from the U.S. what is corresponding to the results that President Trump is already boasting as his achievements,” the adviser added.
North Korea has previously launched missiles to coincide with an American holiday. In 2017, the Asian nation conducted its first successful launch of an intercontinental ballistic missile on the 4th of July. At the time, state media referred to the test as a “package of gifts” for “American bastards.”
Business Have Been Practicing Social Responsibility For Decades, But Is That Really A Good Thing?
The jury is out on whether corporate social responsibility (CSR) programs will one day make the world a better place. But this much is pretty clear: They’re already benefiting the companies that have implemented them. And in some unexpected ways.Specifically, CSR has become the weapon of choice for what is known as, in corporate speak,…
The jury is out on whether corporate social responsibility (CSR) programs will one day make the world a better place. But this much is pretty clear: They’re already benefiting the companies that have implemented them. And in some unexpected ways.
Specifically, CSR has become the weapon of choice for what is known as, in corporate speak, the three R’s: Investor Relations, Human Resources, and Public Relations.
But before we dive into details, a CSR mini-lesson is in order. First off, CSR isn’t an overnight sensation. Over the past couple of decades, companies have been embracing the idea that they need to do more than just make a profit for shareholders. Do-good efforts slowly evolved from passive and limited corporate philanthropy programs—giving to the United Way, for example—to broader and more active CSR programs. Those would take on major social issues like Goldman Sachs’ 10,000 Women program, which in partnership with the International Finance Corporation (World Bank) has delivered $1.45 billion in loans to women-owned businesses in developing countries.
Now, they have evolved even more. Many companies are now incorporating impact-on-society considerations into core business activities. For example, Starbucks only uses “ethically-sourced coffee.” Programs like these are often focused on “sustainability.” In August, 181 CEOs of the country’s largest corporations signed a Business Roundtable statement committing to managing their companies not just for shareholders, but also for customers, employees, suppliers, and communities.
The idea behind all of these efforts is the well-worn slogan “doing well by doing good,” which means that being a positive force in the community will enhance a company’s reputation, which in theory will pay off in more sales, lower costs and over the long term, more money for shareholders.
Can you even measure something like this? Stephen Hahn-Griffiths, chief reputation officer of the Reputation Institute in Boston, says you can. He reels off a string of statistics, like “40% of the reputation of a company is related to corporate responsibility” and says his organization’s research proves that reputation is a leading indicator of stock market capitalization, or the total value of a company’s shares. In other words, he adds, “CSR has a multiplier effect” when it comes to a company’s value. But CSR can be risky. And take a little guts.
According to analysts, CVS’s 2014 decision to stop selling tobacco products cost it $2 billion a year in sales and caused the stock price to drop. (Investors took a $1.43 billion hit that year according to Martin Anderson of UNC Greensboro.) In 2010, Campbell Soup announced it was reducing the salt levels in many of its soups, a decision they reversed the following year when sales fell by 32%.
Meanwhile, in 2018, Dick’s Sporting Goods stopped selling assault rifles. On a panel at this year’s Aspen Ideas Festival, CEO Ed Stack said that decision cost them customers and employees. He notes that many of the customers who applauded the decision at the time seem to have forgotten, but those who were in opposition have not. “Love is fleeting,” he says. “But hate is forever.”
But many companies feel the do-gooder dividend outweighs the risks, both in relations with consumers and in day-to-day operations.
Brad McLane, who recruits high-level positions at RSR Partners, says, “Companies aren’t doing it just to say they have it. My clients are incorporating it into how they do business—what ingredients they use, where they source, how they design products.” Megan Kashner, clinical professor at the Kellogg School of Management’s Public-Private Interface agrees. She’s says that we’ve moved from “greenwashing programs that mimic CSR” to an era of “authentic CSR.” Greenwashing is the practice of making misleading claims that make a company appear more environmentally or socially conscious than it is, for example, when BP began touting itself as being environmentally conscious through a $200 million public relations campaign, only to have a string of environmental disasters—some of which, according to a government report, were caused by corporate cost-cutting to boost profits.
Simon Lowden, Pepsico chief sustainability officer, says, “It’s woven into how we operate as a business. For instance, we need to maintain our license to operate in water-stressed regions, so we’d better focus on being responsible stewards of water. It’s not only the right thing to do, it’s important to our business.”
CSR is particularly useful in human resources. Rebecca M. Henderson, holds the John and Natty McArthur Chair at Harvard and is finishing a book on this topic, Reimagining Capitalism in a World on Fire. She says: “CSR has a tremendous impact on the morale of employees. Authentic purpose, which may mean occasionally sacrificing profits, accesses a whole range of emotions difficult to get at otherwise, like trust and engagement.”
In other words, it gets through. And that is a good thing. It leads to higher levels of productivity and employee retention.
CSR can also be a big factor in recruiting, particularly for younger employees, says Eric Johnson, executive director of graduate career services at the Kelley School of Business at Indiana University. He says, “Social impact is a big piece of the recruiting process. Probably 50 percent of that initial conversation is about what the company is doing to make the world better.”
“Beer companies used to talk about fun and sports. Now they talk about their programs to save water in the world. Social impact can tip the scales. Is a student going to choose an $85,000-a-year job over a $125,000 job because of social impact? I doubt it. But my observation is that jobs heavy in social impact often pay up to 10 percent less than comparable jobs that don’t.”
Professor Kashner adds, “These newly minted MBAs care and they care about the type of work they’re going to be doing. Maybe previous generations drew a line between work and personal life and values, but those boundaries no longer exist.” Korn Ferry, the giant executive recruiting firm, recently surveyed the professionals in its network. “Company mission and values” was the No. 1 reason (33 percent ) they’d choose to work for one company over another.
CSR is increasingly part of the conversation with individual shareholders and investors, like the world’s largest investment firm, BlackRock, which manages $6.5 trillion dollars for its clients. In his last two annual letters, CEO Larry Fink has called on companies to do more and said that BlackRock will evaluate companies on more than just financial numbers. His 2018 letter said, “As divisions continue to deepen, companies must demonstrate their commitment to the countries, regions, and communities where they operate, particularly on issues central to the world’s future prosperity.” Many investment firms now have someone in charge of building portfolios around companies based on their performance on Environmental, Social and Governance or ESG. (Measuring which companies are woke is an industry in and of itself.)
One aggregator of ESG ratings, CSRhub.com, lists 634 data sources. They range from the very broad (for example, Alex’s Guide to Compassionate Shopping) to the very specific (for example, the Alliance for Bangladesh Worker Safety).
For public relations, CSR is both an offensive and a defensive weapon. CSR can be used to pre-empt the conversation in areas where companies have been criticized. Procter & Gamble’s “Ambition 2030 program is heavy on recycling and biodegradability.
But CSR can also be a useful defense. It not only builds up a stock of goodwill with the media and the public, but it generates good news that crowds out the bad. Large corporations are going to get a certain amount of press and awkward questions each day—better that press and those questions be about CSR than, say, worker safety or GMOs. For example, in 2018 when Johnson & Johnson was accused of knowingly selling baby powder with harmful levels of asbestos, Harvard professor Bill George wrote a stirring defense of the company, focusing not on the merits of the claim, but on J&J’s “Our Credo,” a commitment to integrity and customers written in 1943 (and likely the first CSR document ever produced.)
Still, not everyone is convinced. There are many who adhere to the late economist Milton Friedman’s argument that the sole purpose of the corporation is to make more money for shareholders, who can then choose for themselves whether or not they want to save the world.
Judith Samuelson, vice president of Aspen Institute and founder of their Business and Society Program, who’s worked with many of the companies currently leading the way in CSR, says, “The shareholder primacy viewpoint hasn’t gone away. And even if attitudes have changed, measures haven’t. Many executives, including CEO’s, are still paid in stock, and those who manage portfolios for institutional investors are still bonused on the value of those portfolios.”
Samuelson worries that “Companies may think these (current) programs are enough and not make fundamental change.” Kashner is more optimistic. She cites work that says large public companies are increasingly incorporating CSR metrics into executive compensation contracts.
Those who oppose CSR programs argue that trying to do two things at once, like making a profit and serving society, will destroy the effectiveness of companies.
Samuelson scoffs at this. “Of course companies can do more than one thing. Public companies have to manage multiple objectives all the time. No public company in the world would last a week if the only people they cared about were shareholders. What about customers? Employees?”
She believes that CSR really boils down to responsible decision making, doing what it takes for companies to succeed in the long term. Whatever, CSR is here to stay. It’s become part of the fabric of investing, company operations, and business school curricula.
It’s now being tracked and measured, and in business, what gets measured gets done.
→ Sam Hill, a Newsweek contributor, is an author and former C-suiter.
Business Have Been Practicing Social Responsibility For Decades, But Is That Really A Good Thing?