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Preview: RealClearPolitics - Articles - Holman Jenkins

RealClearPolitics - Articles - Holman Jenkins

Last Build Date: Wed, 15 Nov 2006 00:34:50 -0600

Copyright: Copyright 2007

The New York Times and Reality

Wed, 15 Nov 2006 00:34:50 -0600

I waved the story off--knowing the source's next stop was the Times--for another reason: The "father" not named or described in the letter was, in fact, a long-serving board member of Tyco, from 1967 to 2002, who mentored Dennis Kozlowski and was dragged through the legal mud in Kozlowski's downfall. Anyone in-the-know, as surely some of the son's board members were, would have seen in the letter an allusion to his father's searing Tyco experience (a fact the reader would have to be told too), which seemed an additional reason not to offer the letter to the world as an uncomplicated upwelling of revulsion against CEO pay. Not a word about any of this made it into the Times's lengthy rendition, which simply quoted from the letter at length, treating it as a deus ex machina from the corporate world, a CEO spontaneously decrying the greed of his kind. "One Wall Street executive atop a fast-growing firm is saying no to the piles of pay that make corporate America's world spin so splendidly," said the piece. It struck me then and strikes me now that the problem here wasn't just journalistic gullibility or a failure to ask the obvious question. It was a lack of any real feel for human beings or messy reality on the part of a reporter known for relentless but unanalytical execrations of CEO pay. It was no surprise when the same byline turned up again a few weeks ago above a front-page story airing allegations that John Mack, now the head of Morgan Stanley, had helped a hedge fund engage in insider trading. Many paragraphs down, the story acknowledged there was no evidence that Mr. Mack had possessed insider information, or that insider trading had occurred. Rather, the story was apparently justified simply because an ex-SEC attorney, positioning himself a "whistleblower," claimed he had lost his job because his superiors were afraid of antagonizing the prominent Mr. Mack by allowing the attorney to question him. The attorney, the older brother of a rabblerousing San Diego politician and lawyer, had once achieved modest fame suing developers and contractors on behalf of homeowners. At the improbable age of 64, he sought a job as an SEC staff attorney enforcing the securities laws, from whence he brainstormed up the Mack allegations and then lost his job, all in 12 months. Apply Occam's razor to these facts and a modicum of wariness about the accuser's motives might seem to be indicated. After all, one of the great and justified fears of any enforcement agency is of an employee using its powers to pursue a private agenda. The Times instead treated the lawyer's self-ascribed status as a "whistleblower" as if it were automatic proof of good faith. The real question is why do Times editors allow such stuff into the paper? Do they wave it through because it might prove personally inconvenient to try to stop it? Do they believe they have more pressing things to worry about than what appears in the newspaper? For this reason, it's hard to resist the urge to cheer on Hassan Elmasry. He's the mutual fund manager who last spring organized 28% of the shares to withhold their votes from Times directors at the company's annual meeting and last week proposed to put before the next annual meeting the question of whether to end the special voting rights that allow the Sulzberger family to control the company while owning less than 5% of the shares. Mr. Elmasry is a fund manager associated with Morgan Stanley's Van Kampen outfit, but he's based in London and began his campaign long before the Mack allegations emerged (so forget the idea that his motive is anything but to rescue his fund's long investment in the New York Times Co.). The selling point of his fund is its disciplined focus on buying a handful of companies (no more than 40) with unique franchises, holding them for the long term and watching them carefully. The New York Times Co. has been in his portfolio for a decade. This hasn't stopped the usual kibitzers from suggesting that his Times campaign is just a "typical" Wall Street effort to squeeze out short-term profits at th[...]

Spitting Into the Wind on Immigration

Wed, 14 Jun 2006 00:45:16 -0600

With 12 million illegals in the country, whole sectors of our economy exist only because of immigrant labor. Farms would shut down along with jobs for suppliers of seeds, packaging and ancillary services. Jobs for waiters, maître d's and chefs would vanish, not just those of immigrant busboys, kitchen hands and cleaners. Some 1.2 million illegals are believed to work in construction. If the cost of home building goes up, demand goes down: Less wood is sold, fewer nails, fewer power tools, fewer pickup trucks. Contractors would make less profit; ergo, Harley-Davidson would sell fewer Road Kings with all the chrome and finery. Armchair wonks say, "Enforce the law and damn the consequences." Every time the government does, however, a few of those couch warriors suddenly become vocal activists on the other side. It's their employer, their brother-in-law, their neighbor who finds himself facing criminal charges. It's their house that doesn't get finished. Don't be surprised if some of the latest politically inspired crackdowns end the same way. Blowback in the Cincinnati area is already growing against the arrest last month of four foremen for Fischer Homes, a well-liked local home builder. In search of a respectable argument, liberal enthusiasts for a border clampdown have lately adopted the obnoxious and condescending reification of "unskilled labor" popularized by some economists. It may be true in some sense that illegals hold down the wages of low-wage workers, but it tells you nothing useful. It tells you only that the supply of immigrant workers has an impact on the wages of mostly immigrant workers for jobs that mostly would not exist if immigrant workers weren't available to fill them. The very category "unskilled labor" is misleading. Any American worker, however backward, has one important skill advantage over most illegal immigrants: English. And all workers have a skill that leads to more skills: They can learn. In turn, a decently functioning job market rewards people for acquiring skills, not for remaining unskilled--perverse is the idea of wanting to reduce labor competition for unskilled jobs in order to make unskilled jobs more desirable. OK, let's ban unskilled immigrants altogether. Let's welcome all the doctors and engineers who want to come but reserve the no-skill jobs for Americans. Let's make it so attractive for Americans not to acquire skills that we can close our schools. Think of the money we'd save. If this is crazy, it's only so because of the crazy premise. Immigrant workers are a resource--no economy is better off for taking resources away. Mexicans--let's admit this is largely about the Mexican wave--have crossed the border for jobs ever since there was a border. And amnesty was once routine because the statute of limitations on illegal entry ran out in five years. If the hypocrisy of our current system bothers you--and it should, because it allows workers to come and toil for us without granting them legal status--it's no denigration of the idea of law and lawfulness to admit to ourselves we have a bad law on our hands. What's a better approach? Even guest worker solutions are artful fudgery--a guest worker won't go home any more reliably than an illegal will. So how about just open the door to anyone willing to put down a refundable entry deposit (say, $2,000) in return for a biometric work card? At a stroke, this would take the profit out of a vast underground industry. Chinese "snakeheads" cadge upwards of $40,000 per illegal immigrant. Latin "coyotes" get $2,000 or more. Not to mention the sizeable business done by document forgers and traffickers in stolen Social Security numbers. This deposit could be charged off against future income tax liability (note, not payroll taxes), an incentive for immigrants to stay legal and move up into the bracket-worthy classes. It could be refunded when they leave the country--an incentive to return home if jobs become scarce in the U.S. Polls say Americans want immigration cut down and they don't want amnesty for i[...]