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from nicholemhearn digest http://www.chicagobusiness.com/section/newsletter-signup-daily-alert?utm_source=NEWS07&utm_medium=rss&utm_campaign=chicagobusiness

Outcome Health is cutting jobs

Just days after announcing plans to hire 2,000 people over the next five years, the fast-growing health care-media company is laying off staff.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/BLOGS11/170929830/outcome-health-is-cutting-jobs?utm_source=BLOGS11&utm_medium=rss&utm_campaign=chicagobusiness

Outcome Health is cutting workers

Just days after announcing plans to hire 2,000 people over the next five years, the fast-growing healthcare-media company is doing layoffs.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/BLOGS11/170929830/outcome-health-is-cutting-workers?utm_source=BLOGS11&utm_medium=rss&utm_campaign=chicagobusiness

Illinois has a choice to make about fracking—and Rauner is making the wrong one

People are always ahead of the politicians.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/OPINION/170929831/illinois-has-a-choice-to-make-about-fracking-and-rauner-is-making?utm_source=OPINION&utm_medium=rss&utm_campaign=chicagobusiness

Trump plan would raise taxes on some middle-income people, study says

The White House says the rate cuts in its plan would benefit the middle class. "We don't agree with them," says the co-director of the nonpartisan Tax Policy Institute.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/NEWS01/170929833/trump-plan-would-raise-taxes-on-some-middle-income-people-study-says?utm_source=NEWS01&utm_medium=rss&utm_campaign=chicagobusiness

Have you checked your employer's pension fund lately?

These pension plans are in trouble—and no, they're not for public-sector employees.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/ISSUE01/170929834/have-you-checked-your-employers-pension-fund-lately?utm_source=ISSUE01&utm_medium=rss&utm_campaign=chicagobusiness

PODCAST: MARKUPS, MARKET CONCENTRATION, AND MONOPOLISTIC COMPETITION

On Friday, I was honored to be a guest on the Economics Detective Radio podcast with Garrett Petersen. Our topic was monopoly power and price mark-ups in the U.S. economy, and was based on a series of posts I wrote in response to a paper by Loecker and Eeckhout that claimed that average markups in the American economy had risen from 18 percent in 1980 to 67 percent today.

As I wrote at the time, the paper’s argument is intriguing—but the question of market power in the modern economy is complex, and not amenable to our basic intuitions.

On the one hand, the fact that the authors have put together a single explanation for multiple, contemporaneous puzzles makes me very reluctant to dismiss the work they have done. It is highly likely they have stumbled upon something. The question is, what exactly?

Here is the problem. When the authors said there had been a massive increase in markups and hence market power in the U.S. economy, it seemed as though they were going to tell a story about Apple, Goldman Sachs and maybe even Wal-Mart. That is not, however, where the action is.

I encourage you to listen to the whole thing here or below, or by downloading the latest episode of Economics Detective Radio on iTunes.

The post PODCAST: MARKUPS, MARKET CONCENTRATION, AND MONOPOLISTIC COMPETITION appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/podcast-markups-market-concentration-monopolistic-competition/

Griffin donates $1.5 million to Navy SEAL Foundation

The founder and CEO of hedge fund Citadel has now donated $600 million to education, the arts and other causes.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/NEWS01/170929837/griffin-donates-1-5-million-to-navy-seal-foundation?utm_source=NEWS01&utm_medium=rss&utm_campaign=chicagobusiness

THE BIG SIX’S TAX REFORM FRAMEWORK: THE GOOD AND THE BAD

The Big Six —two representatives each from the White House, the Senate and the House of Representatives — released their framework for tax reform on Wednesday and the responses have been lukewarm to negative. A particularly brutal take came from Josh Barro at Business Insider, who called the GOP’s pledge to “double the standard deduction” a lie.

Here’s the important fine print: “To simplify the tax rules, the additional standard deduction and the personal exemptions for taxpayer and spouse are consolidated into this larger standard deduction.”
…

If you have children, your fate is uncertain. The plan would abolish the $4,050 exemption you get to take for each of your dependent children. But it would also increase the child tax credit—by an unspecified amount. Once that amount is specified, you’ll be able to figure out whether you face a tax increase or a tax cut or what.

Indeed, Barro is right. The released framework suggests, but doesn’t guarantee an actual reduction in taxes for middle- and lower-income taxpayers. Furthermore, I agree with my colleague Sam Hammond that the most promising way to provide relief for middle-and lower-income families is a large refundable increase in the child tax credit.

Yet, while this proposal isn’t as promising as it could be in terms of tax relief, it scores better as tax reform. For individual taxpayers, we see a meaningful effort to curb and slowly eliminate the myriad of deductions and loopholes that plague the tax code. On the corporate side, the move to a territorial system is a step in the right direction, toward a system with less gamesmanship and fewer tax-avoidance strategies.

That being said, I understand the incredulity and disgust provoked by the administration’s rhetoric. President Donald Trump explicitly rejected the tax reform label in favor of the more compelling, but far less accurate, language of a middle-class tax cut. We shouldn’t, however, let the president’s inanity drive our actual analysis of policy. If we do that, the imps win. Secretary of State Rex Tillerson said it best: “The president speaks for himself.”

There are two big elements in this package that tax reformers have been looking for—for decades. The first is an end to itemization in the individual tax code. The second is the move to destination-based taxation in the corporate code.

Individual Tax Reform

The tax reform framework calls for collapsing the personal exemptions in the current tax code into a new, larger standard deduction. In the current tax system, virtually all taxpayers get to claim a personal exemption for each member of their household. Then on top of that, taxpayers get to choose to either itemize the rest of their deductions or take the standard deduction. About 70 percent of taxpayers choose the standard deduction. The 30 percent who choose to itemize are often wealthier households, who do so to take advantage of the home mortgage interest deduction, the charitable deduction or the deduction for state and local taxes.

Sweeping the personal exemption into a larger standard deduction has a few effects. First, it increases the amount of income someone can make before they owe any taxes at all.

One of the more unfortunate aspects of the 2012 presidential campaign was the rise of the “I am the 53 percent” movement. The movement’s name stemmed from Republican nominee Mitt Romney’s comment that 47percent of Americans pay no income tax at all and its central complaint was that the other 53 percent of Americans who did pay income tax were shouldering the burden of their indolent compatriots.

In truth all Americans—in their roles as workers, owners or simply consumers—bear the burden of taxes whether they write a check to the government or not. Taxes distort and typically reduce the size of the economy in ways that affect everyone.

The most distortionary effects, however, come at the extensive margin. That refers to the decision to work or invest at all. For this reason, taking as many low-income workers off the tax rolls completely has been a goal of tax reform going back to 1981. We’d like the tax system to encourage or, at a minimum, not discourage folks from entering the labor market and developing skills. For families with children this means the Earned Income Tax Credit. For young single people with few skills, this means taking as many off the tax rolls as possible.

Second, sweeping the personal exemptions into the standard deduction makes itemizing far less attractive. Now, a family considering itemizing would have to find at least $24,000 worth of deductions to make it worthwhile. For most itemizers, the largest deduction is the one for home mortgage interest. Under the new system a family would need an outstanding mortgage balance of at least $600K, for their interest payments to exceed the standard deduction.  

Adding additional deductions could push a family over the threshold, but most deductions have been slated for removal. Only the charitable deduction is scheduled to remain. In particular, the state-and-local-tax deduction has been cut.

As Niskanen Senior Fellow Ed Dolan points out, the state-and-local-tax deduction is particularly important for high- income earners in high-tax urban areas. These are precisely the areas that have the highest housing costs and consequently the families with the largest mortgage balances. This creates an interaction effect. Cutting out the state-and-local-tax deduction makes itemizing less attractive to high-income urban families, the types of people who were most likely to use the home mortgage interest deduction. The option to itemize still exists but its constituency has been cut down to the highest-income folks with the most expensive houses.

There is an element of genius to this setup that is worth noting. High-income urban voters are probably the least sympathetic group to the core Republican constituency. Even though some of these people are, of course, Republicans, the GOP does not see itself as the party of the urban elite. This makes targeting the deductions politically palpable. It also leaves an escape hatch for Realtors, one of the most powerful lobbying groups.

While even more taxpayers will be induced to take the standard deduction, the ones with the most expensive houses—that is, the houses  earning the highest commissions—will still itemize.

Political maneuvering is not the most attractive feature in a tax-reform proposal, but the reason it’s worth mentioning is that cutting deductions has traditionally proven intensely difficult. Interest groups are keenly aware of the deductions that apply to them or their customers, and fight to maintain them. Finding a way to cut through that thicket of opposition is an achievement unto itself.

Business Tax Reform

On the business tax code, moving to a territorial corporate system is the most meaningful reform. Right now, U.S. multinationals use a variety of subsidiaries and legal setups to avoid being taxed as U.S. corporations. This is because U.S. corporations owe taxes on all the profits they earn regardless of where those profits were made.

The motivation behind taxing profits where they are earned is understandable. We wouldn’t want U.S. companies to move production overseas just so they could enjoy a lower tax rate. The results, however, are perverse. Instead of moving more production overseas, U.S. companies have created overseas headquarters or subsidiaries, often-times just on paper, and then attributed all of those profits to the headquarters.

U.S. states have faced this type of problem for decades. In one of the most infamous and perhaps humorous cases, Toys “R” Us, created a subsidiary known as Geoffrey Inc. Geoffrey is the name of the giraffe in the Toys “R” Us logo. Geoffrey Inc. owned the rights to use the giraffe’s likeness and it charged a hefty fee. Since all Toys “R” Us stores use the logo, all had to pay huge licensing fees and consequently many ran in the red. As such, they owed little corporate tax. Geoffrey’s, however, made money hand over fist, but because it operated out of Delaware, where intangible assets are exempt from the corporate tax, Geoffrey likewise owed no corporate tax. States moved to undercut these types of machinations, but businesses would adapt and create new schemes. The result was a continual erosion of the corporate tax base.

These same forces are now playing out at the international level. The solution is to abandon the attempt to tax profits wherever they occur and instead focus on taxing economic activity that occurs in the U.S. This does create a form of tax competition. Companies would be incentivized to move out of the U.S. if our corporate taxes were too high. However,  and I know this is a long sell, this isn’t as bad as it might seem.

In the most dystopian scenarios tax competition will lead to a race to the bottom, in which countries wind up driving their tax rates to zero or even below zero to chase corporate jobs. In that world, workers would end up not only shouldering the burden of all taxes but also of subsidies doled out to their employers.

This scenario is unlikely to come to pass. Tax competition is not the only dimension across which countries compete for employers. A skilled workforce, the rule-of-law, infrastructure, proximity to markets, and social and cultural amenities all figure into the calculus. To the extent that these factors increase corporate profitability, corporations will be willing to pay tax to have access to them.

Moreover, to the extent that cutting the corporate tax undermines a nation’s ability to pay for these things, corporate tax cuts will not be job promoting. The reality of tax competition sharpens the trade-off between the cost of taxation and the services those taxes provide, but it does not change the fundamental relationship.

A Tax Cut for the Rich

At the end of the day, isn’t this just about cutting taxes on the rich? Vox co-founder  Matt Yglesias wrote:

Republicans want to pass a large tax cut for high-income households. We know that because the House GOP’s tax reform blueprint features large tax cuts for high-income households, all the various iterations of Donald Trump’s campaign tax plans featured large tax cuts for high-income households, and all throughout Barack Obama’s first term, Republicans fought relentlessly to prevent the expiration of George W. Bush’s temporary tax cuts for high-income households.

There is no doubt in my mind that passing a large tax cut for America’s wealthiest households is a key motivator for some folks within the Republican caucus. The Big Six hope to pass their tax reform through the Republican caucus and so they leave ample room for that to happen. Nonetheless, tax cuts for the rich are clearly not the only motivator here. There is no reason to engage in politically costly reform when all you want to do is get the tax rate down.

Notably the framework left open the door for an unspecified fourth tax rate and included the provision that the new framework be at least as progressive as current law. Now you might think this is just a talking point, but I doubt it. First of all, it’s not very strong. It’s wonkish and vague. If anything it simply sets you up for a bruising critique if you fail to hit the market.

For another thing,  if the epic and humiliating failure of Obamacare repeal has revealed anything it is that legislatures are neither the mindless automatons of some shadowy cabal nor dyed-in-the-wool ideologues who will do what it takes to achieve their parties’ goals.

Not only do the parties have differing interests and allegiances, but they are not even fully aware of what one another’s interests and allegiances are. That’s why they can go up to the wire in both the House and the Senate believing that they have support for a bill only to find at the last minute that they do not.

In short, they face serious communication and coordination failures within their own caucus. The most important function of a document like the framework is not to ever-so-slightly nudge the needle on public opinion, but to herd their own members in line. Without that, they have absolutely no chance of success. To wit, I am guessing that the reason the line about progressivity is in the framework and the door on a fourth tax rate is left open is because the negotiators mean it.

Even more importantly, no matter what the personal motivation of either the Big Six or the Republican caucus as a whole, the simple fact is that this framework does lay out significant reforms. The framework may not hold, and the reforms may be ditched, but that would be bad precisely because some of the ideas within it are good.

The post THE BIG SIX’S TAX REFORM FRAMEWORK: THE GOOD AND THE BAD appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/big-sixs-tax-reform-framework-good-bad/

Did Rauner just uncork a challenge from the right?

As the impact of the governor's decision to sign a controversial abortion bill reverberates, a key GOP state lawmaker has begun eyeing a possible primary race against him.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/BLOGS02/170929845/did-rauner-just-uncork-a-challenge-from-the-right?utm_source=BLOGS02&utm_medium=rss&utm_campaign=chicagobusiness

Abbott Labs' torturous deal saga isn't over yet

This Alere ordeal has put an uncomfortable spotlight on Abbott's M&A strategy, and the company still has to prove this pursuit was worthwhile.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/NEWS03/170929846/abbott-labs-torturous-deal-saga-isnt-over-yet?utm_source=NEWS03&utm_medium=rss&utm_campaign=chicagobusiness

Old and New in Trump’s UN Debut

President Donald Trump gave his first speech at the United Nations last week. And as expected, it was a memorable one. In off–the-cuff-remarks that once again provided a memorable reaction from White House Chief of Staff John Kelly, Trump personally insulted Kim Jong Un. In the same breath, the president suggested the North Korean leader was suicidal. Trump also focused heavily on American sovereignty and, even while pledging cooperation with other international actors, he suggested a more unilateral approach to U.S. foreign policy.

The speech garnered a great deal of reaction in its aftermath. Some have suggested that it marked a significant departure in American foreign policy. However, it is worth parsing how much was actually new in Trump’s speech and what its implications were.

Two aspects of Trump’s speech suggest major departures from American foreign policy. First, Trump’s robust assertions about national sovereignty suggested a new unilateral turn in U.S. foreign policy. Second, in the same sentence in which he mocked Kim as “rocket man,” Trump said the United States would “totally destroy” North Korea if the Kim regime attacked a U.S. ally.

Neither the theme of unilateralism nor the threat to annihilate a country for attacking a U.S. ally is really all that new. While America’s pre-World War II foreign policy is often (wrongly) referred to as isolationism, unilateralism more accurately describes it. As historian Walter McDougall wrote in Promised Land, Crusader State: The American Encounter with the World Since 1776, “Let us dispense with [isolationism] altogether and substitute for it a word that really describes the second great tradition in American foreign relations: Unilateralism.”

McDougall continued:

Unilateralism never meant that the United States should, or for that matter could, sequester itself or pursue an ostrich-like policy toward all foreign countries. It simply meant, as Hamilton and Jefferson both underscored, that the self-evident course of the United States was to avoid permanent, entangling alliances and to remain neutral in Europe’s wars except when our Liberty—the first hallowed tradition—was at risk.

Unilateralism as an American foreign policy tradition was not confined to the pre-World War II era. As historian Melvyn Leffler argued in a discussion of former President George W. Bush’s post-Sept.11 unilateralism:

During the Cold War, policymakers adroitly and skillfully formed alliances and held them together, but never foreclosed the right to act unilaterally and often did so. Unilateralism is quintessentially American. And when the Cold War ended, temptations to act unilaterally multiplied, often infuriating allies. [Former President Bill] Clinton sometimes worked assiduously to contain and coopt unilateralist pressures, but he, too, recognized that unilateralism was not only politically expedient, but also might be strategically imperative.

Similarly, the threat to destroy a country in response to an attack on a U.S. ally has been at the heart of America’s extended deterrence strategy dating back to the early days of the nuclear age. In his famous 1954 speech at the Council on Foreign Relations, Secretary of State John Foster Dulles announced that the policy of the United States in response to Soviet aggression against its allies would be one of “massive retaliatory power” using nuclear weapons. While the United States has constantly searched for ways to respond to aggression and maintain the credibility of its extended deterrence guarantees at lower levels of violence, that threat to essentially destroy a country has remained present ever since.

So why was Trump’s speech a problem?

There are three major differences in his speech. First, it is unclear what larger principle the Trump administration’s unilateralism is moored to. Early American unilateralism was a means to avoid entanglement in European great power politics for the preservation of American liberty. Postwar multilateralism was a means to preserving an open international system that American leaders believed would present another World War. Even the Bush administration’s unilateralism—to which some compared Trump’s speech—was moored to a larger principle of spreading liberal democracy and maintaining a liberal international order through robust application of U.S. military power. Throughout his speech Trump’s assertion of the principle of sovereignty was uneven—suggesting possible military interventions in Iran, Venezuela, and elsewhere—because it was unclear what principle unilateralism is meant to serve for the 45th president.

Second, the typical paeans to multilateralism and unwillingness to explicitly threaten to destroy an entire country in retaliation for an attack on America’s allies served a purpose. Some people who do not otherwise support Trump in any way have suggested that his willingness to jettison America’s traditional talk of values and instead embrace naked self-interest as the basis of U.S. foreign policy is a good thing because America never lives up the ideals it claims underpin its foreign policy. However, as political scientists Henry Farrell and Martha Finnemore explained in May, such hypocrisy is useful:

In moderation, Trump’s lack of control might be refreshing. When in a February interview, Fox News’ Bill O’Reilly pressed Trump about his relationship to Russian President Vladimir Putin—“a killer”—Trump responded that there are many killers and asked rhetorically whether “our country was so innocent.” He pointed out aspects of U.S. behavior that both liberals and conservatives prefer to gloss over. Under ordinary circumstances, a presidential acknowledgment that the United States has regularly killed people under sketchy circumstances might spur serious debate. But nothing about Trump is moderate. Trump wants not only to acknowledge America’s dark side but to embrace it, building U.S. policy on naked self-interest and short-term advantage.

 

The problem is that hypocrisy is as crucial to international politics as to personal relations. Blunt pursuit of self-interest is rarely appealing to others. American leaders used to push the self-serving myth that U.S. interests and the world’s interests were mostly the same, and that America was the one indispensable nation. Now, Trump has driven a highly visible wedge between American interests and the world’s. “Make America Great Again” might be an attractive slogan to a many American voters, but it is unlikely to attract non-Americans, who fear that Trump wants to make America and himself great at their expense, something that, in turn, will make greatness harder to achieve.

While it is easy to yawn at platitudes about American ideals most presidents spout as the United States conducts military operations around the globe, the appeals to American beneficence play an important role in producing peaceful international cooperation. They suggest, for all of America’s many flaws, it aspires to something greater even if it, more often than not, fails to achieve it.

Third, whether implied or explicit, threats to destroy an entire country are premised on the idea that the actor on the receiving end is rational and interested in self-preservation. Trump’s declaration that “rocket man is on a suicide mission” suggests that he does not think the North Korean leader is rational.

As Mira Rapp-Hooper, an expert on nuclear deterrence at the Paul Tsai China Center at Yale Law School, noted following Trump’s remarks, the president could be building the case for preventive war. In the process though, he may be raising the risks of miscalculation. She wrote:

If, in fact, it was true that Kim is not able to act in his own self-interest and unable to respond to deterrent threats, that would help to build the case for preventive war against North Korea. In that scenario, it might actually make sense to pay the horrendous costs of a military confrontation to eliminate a far worse nuclear threat—if one believed it was inevitable that North Korea would use nuclear weapons against the United States and its allies later.

 

There is no evidence that this is true of Pyongyang—repeat—no evidence whatsoever. North Korea has long had a stated goal of reunifying the Korean Peninsula, but the country has been deterred from large-scale military action since the end of the Korean War in 1953. The fact that Kim and his father and grandfather before him managed to stay in power despite long odds suggests that they are masters of survival, and therefore rational calculators.

 

[National Security Adviser H.R] McMaster’s argument appears to rest on a false premise: that a brutal, loathsome dictator can’t also be a rational actor. History shows the opposite (take the examples of Joseph Stalin, Mao Zedong). The fact that Trump said Kim “is on a suicide mission” is worrisome. If Trump believes this, it could be part of a justification for preventive war.

Rapp-Hooper continued:

Trump’s characterization of Kim as being “on a suicide mission” may raise the North Korean leader’s fear that Trump shares McMaster’s view: If Kim is undeterrable, then a U.S. first strike may be logical.

 

If Trump is bluffing, he is also raising the risk of miscalculation and an accidental or inadvertent clash. If he is serious, he is threatening preventive military action that could start the bloodiest conflict since World War II.

To sum up: Trump’s rhetoric at the U.N. last week was not much of a departure from America’s foreign policy traditions. However, the fact that it is unmoored from any larger principle and unnecessarily reckless makes it both counterproductive and dangerous.

The post Old and New in Trump’s UN Debut appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/old-new-trumps-un-debut/

The AV START Act Gets the Rules of the Road Right for Autonomous Vehicles

Yesterday, Senator John Thune (R-ND) and Senator Gary Peters (D-MI) introduced the American Vision for Safer Transportation through Advancement of Revolutionary Technologies (AV START) Act. This bill would expedite the deployment of autonomous vehicles on American roads, making transportation options more efficient, more accessible to the elderly and disabled, and ultimately safer.

For all those reasons, the Niskanen Center is happy to support this bipartisan effort, which aims to tackle the many problems of our human-operated vehicle fleet by minimizing the barriers to autonomous vehicles entering the market.

As we noted in a letter to Chairman Thune and Senator Peters:

Autonomous vehicles, like many emerging technologies, present new and unique challenges for lawmakers and regulators. This new frontier requires that we reconsider rules designed for a non-digital world; twenty-first century technologies require twenty-first century regulations. By recognizing this regulatory reality, the AV START Act will help usher in a safer and more autonomous transportation future for all Americans.

Additionally, the AV START Act mirrors many of the provisions contained in the National Highway Traffic Safety Administration’s (NHTSA) guidance for autonomous vehicles. By focusing on voluntary best practices for industry, NHTSA has come a long way since its initial policy guidance draft from 2016, which originally proposed more sweeping regulatory authorities and potentially burdensome reporting requirements.

The bill also shares many similarities with the SELF DRIVE Act, which recently passed by a unanimous voice vote in the House of Representatives. Notably, both bills embrace the need for preempting states on safety regulations, a stepwise increase in the number of autonomous vehicles that can be deployed, and requirements for firms to implement actionable cybersecurity plans, without dictating particular standards or approaches.

Between the recently-passed SELF DRIVE Act, the Senate’s AV START Act, and the newly promulgated NHTSA policy guidance, the future of autonomous vehicles is looking bright.

The Niskanen Center applauds the care and consideration that went into drafting this legislation.

The post The AV START Act Gets the Rules of the Road Right for Autonomous Vehicles appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/av-start-act-gets-rules-road-right-autonomous-vehicles/

The new O'Hare: Here's a sneak peek

With talks over O'Hare gate expansion and usage fees now in the final stages, the city provides a look at what's been agreed on designwise.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/BLOGS02/170929852/the-new-ohare-heres-a-sneak-peek?utm_source=BLOGS02&utm_medium=rss&utm_campaign=chicagobusiness

The most beautiful new building this year is a factory in Hoffman Estates

Trumpf Smart Factory is that rare achievement—an architecture of real poetry. It's a relatively small building, but architects Barkow Leibinger had large aspirations that were met and exceeded.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/NEWS07/170929853/the-most-beautiful-new-building-this-year-is-a-factory-in-hoffman?utm_source=NEWS07&utm_medium=rss&utm_campaign=chicagobusiness

How taxpayers could spend more on a private school student than a public school pupil

A controversial experiment in using state resources on private schools could cost Illinois two to five times more per student than it now spends on general aid for public-school pupils.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170929/NEWS02/170929854/how-taxpayers-could-spend-more-on-a-private-school-student-than-a?utm_source=NEWS02&utm_medium=rss&utm_campaign=chicagobusiness

Looking for a classic car? He'll hook you up.

At 90, real estate investor Larry Klairmont has amassed one of the most important classic car collections in the U.S. Forty of them go up for auction next week in Schaumburg.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS07/170929862/looking-for-a-classic-car-hell-hook-you-up?utm_source=NEWS07&utm_medium=rss&utm_campaign=chicagobusiness

He's got one of the most important classic car collections in the U.S.

At 90, real estate investor Larry Klairmont has bought and restored more than 350 vehicles. Forty of them go up for auction next week in Schaumburg.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS07/170929862/hes-got-one-of-the-most-important-classic-car-collections-in-the-u-s?utm_source=NEWS07&utm_medium=rss&utm_campaign=chicagobusiness

Benefits of Tenant Representation When Renting Commercial Real Estate

The following post is copyrighted by Austin Tenant Advisors - .

One of the most common questions we get is, “Why should I hire a tenant representative to lease commercial real estate?” Because we want our clients to feel comfortable and confident when renting office space, retail, or warehouse space we have compiled a list of some advantages of retaining exclusive tenant representation for your company.

Advantages of Using a Tenant Rep Broker to Rent Commercial Real Estate

• Tenant representatives work exclusively for tenants, not for landlords or buildings
• The most objective evaluations of buildings are obtained from tenant representatives, who have no interest in promoting one building over another
• Tenant representatives offer state-of-the-art professional advice based on in-depth market knowledge and current experience, putting tenants on an equal basis with professional, full-time landlords
• Client’s time is saved by not duplicating market research
• Clients obtain objective evaluations of their alternatives, free from any personal bias
• Costs affecting the transaction are analyzed, presented, and documented so that the final facility decisions can be approved by senior management, based on financial comparisons
• Clients often win more concessions, minimize hidden costs, achieve greater lease flexibility, because of tenant representatives negotiating experience and familiarity with key buildings, landlords, listing agents, and market conditions
• The groundwork for a workable future landlord-tenant relationship is established because tenant representatives act as negotiators, intermediaries, and buffers rather than as principals
• Confidentiality is kept at all times so that your workforce is not aware of a pending relocation until the time is right to communicate
• Tenant reps will have knowledge about and access to all available and soon to be available listings in the market via the relationships with landlord agents, paying a lot of money for the best MLS services, and because of being in the market full time.
• Clients achieve buying leverage and buying power because of tenant representatives expertise and ability to create a competitive environment among candidate buildings
• Landlord will be more likely to return your calls because of the tenant reps broker relationships and reputation in your metro area.
• Tenant reps know what a good deal looks like because they do them every day. You will get the lowest lease rate and best terms possible
• Tenant representatives can put together a professional team to carry out the move

If you are looking for a tenant representative in Austin Tx give us a call and see if we are a fit for your business.

The post Benefits of Tenant Representation When Renting Commercial Real Estate appeared first on Austin Tenant Advisors.

Tillman and Proft deny jobs deal with Rauner

A little more about staff changes in the Rauner administration, political fundraising and who did and didn't do what.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/BLOGS02/170929856/tillman-and-proft-deny-jobs-deal-with-rauner?utm_source=BLOGS02&utm_medium=rss&utm_campaign=chicagobusiness

Siemens to add 100 R&D jobs downtown

The German tech giant is opening an R&D center downtown in former Google offices.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/BLOGS11/170929858/siemens-to-add-100-rd-jobs-downtown?utm_source=BLOGS11&utm_medium=rss&utm_campaign=chicagobusiness

How Landlords Evaluate Prospective Commercial Real Estate Tenants

The following post is copyrighted by Austin Tenant Advisors - .

When renting commercial real estate (office, retail, or warehouse space) landlords have certain criteria that they typically look for in a good commercial real estate tenant. Financial viability is the key issue for landlords. They want to be assured that their tenants won’t go out of business before the lease expires or jump from building to building just to get concessions.

Landlords also look at the type of tenant. Will this tenant help to create a mix that will, in turn, attract other good tenants? Banks, large law firms, and major accounting firms, for example, fall into this category.

At the same time, landlords are sensitive to the size of the tenancy proposed. They may not want one tenant to dominate the building. Advertising and public relations companies, for example (often the first to be faced with downsizing during economic downturns), are risky as predominant tenants in a building.

Although landlords would prefer to deal solely with tenants that have the best credit, they also recognize that sometimes they must accept risk. In these instances, they may want to minimize the risk by spreading a concession such as free rent over the life of the lease rather than giving it all in the first part of the lease.

Financial information is critical and they WILL ask to see your company financials. Psychology plays a role too. Landlords also want to know the reasons why prospective tenants are planning to move, and what motivates them.

Even in a soft market, property owners must be sold on prospective tenants, and even existing tenants.

Factors Landlords Consider When Rating Prospective Commercial Tenants

• Financial conditions
• Amount of space needed
• Occupancy date without lease assumptions
• Parking demands
• Potential for growth
• Potential of attracting other tag along tenants
• Potential use of amenities such as fitness center, deli, and banks
• Degree of reusable tenant improvements
• History in the commercial rental community
• Reasonable flexibility of desired placement within the property
• Timing of the lease acceptance
• Whether the property was the first or second choice
• Etc, Etc

As you look at commercial properties for rent and are comparing buildings and landlords, keep in mind that they are evaluating you as a potential tenant also. You want to make sure that you understand what landlords look for in a good commercial tenant so that you can prepare your company to meet the financial and other criteria that landlords have.

The post How Landlords Evaluate Prospective Commercial Real Estate Tenants appeared first on Austin Tenant Advisors.

Next stop for Portillo's: Madison

The hot dog and beef sandwich chain could be up to 60 locations next year as it expands beyond metro Chicago.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/BLOGS09/170929860/next-stop-for-portillos-madison?utm_source=BLOGS09&utm_medium=rss&utm_campaign=chicagobusiness

'Please don't shoot: Peace group creates underwear to save lives

Saturday Morning, a coalition for peace and change around racial inequality formed last year by several African-American creative leaders, has developed a line of underwear intended to save lives, with Chicago a particular focus.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS06/170929861/please-dont-shoot-peace-group-creates-underwear-to-save-lives?utm_source=NEWS06&utm_medium=rss&utm_campaign=chicagobusiness

Hef and Chicago go way back

How Marilyn Monroe—and Ad Age—helped launch the Playboy empire.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS06/170929863/hef-and-chicago-go-way-back?utm_source=NEWS06&utm_medium=rss&utm_campaign=chicagobusiness

250,000 could lose heat this winter unless this dispute is resolved

Nicor, the state's largest natural-gas utility, has gone to court to force railroad operator CN to give it access to a crucial pipe segment in the railroad's right of way.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS11/170929865/250000-could-lose-heat-this-winter-unless-this-dispute-is-resolved?utm_source=NEWS11&utm_medium=rss&utm_campaign=chicagobusiness

AbbVie buys more time for top-selling Humira

The North Chicago-based biopharma company has struck a deal with a rival that's been trying to encroach with a cheaper alternative to Humira, the top-selling drug in the world.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS03/170929866/abbvie-buys-more-time-for-top-selling-humira?utm_source=NEWS03&utm_medium=rss&utm_campaign=chicagobusiness

Another downtown loft office tower is up for grabs

A suburban Detroit investor is looking to cash in on a hot market.

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170928/CRED03/170929867/another-downtown-loft-office-tower-is-up-for-grabs?utm_source=CRED03&utm_medium=rss&utm_campaign=chicagobusiness

Chicago only global city where housing is undervalued

While a bubble could be ahead for three-quarters of the major world cities in a study, sluggish growth in home prices is forecast here.

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170928/CRED0701/170929870/chicago-only-global-city-where-housing-is-undervalued?utm_source=CRED0701&utm_medium=rss&utm_campaign=chicagobusiness

Pilsen sees flurry of high-priced new-home sales

New-construction homes in the Pilsen neighborhood are selling at a previously unknown upper tier of prices.

Six newly built homes have sold for $720,000 or more in the neighborhood this year, three of them in the past month.

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170928/CRED0701/170929871/pilsen-sees-flurry-of-high-priced-new-home-sales?utm_source=CRED0701&utm_medium=rss&utm_campaign=chicagobusiness

Global Warming Tort Litigation: Two Very Different Approaches

In the latest chapter of U.S. climate change litigation, San Francisco and Oakland sued five oil and gas companies (Chevron, Exxon, BP, Shell, and ConocoPhillips) last week, accusing them of contributing to a public nuisance – global warming-induced sea level rise. Filed simultaneously in state court, these (essentially identical) complaints seek an order requiring the defendants to pay for constructing sea walls and other infrastructure necessary to protect the cities from sea level rise, which threatens billions of dollars of coastal property.

These cases follow closely on the heels of three global warming tort lawsuits filed in July by two California counties and a municipality (San Mateo County, Marin County, and Imperial Beach) against numerous fossil-fuel companies for allegedly contributing to global warming. Those three cases filed in state court as well, also focus on sea level rise injuries.

What makes these two sets of cases noteworthy is that the legal claims are based on state, and not federal, law – a development long in the making. But the two sets of cases employ fundamentally different legal strategies, and there are several reasons why the San Francisco-Oakland approach may prove to be a far sounder strategy.

The basic difference between the two strategies is simplicity versus complexity. San Francisco and Oakland allege a single claim (public nuisance) against a manageable number of defendants, and seek an “abatement fund” to pay for the required adaptation. This is the same legal theory successfully employed by these cities (and other California cities and counties, including San Mateo County) against the lead paint industry, which resulted in a court order (now on appeal) establishing a billion-dollar abatement program to be funded by the lead paint industry. Environmental harm is a classic case of public nuisance, and simply requires demonstrating that the defendant contributed to a condition that constitutes an unreasonable interference with public rights.

In contrast, San Mateo et al. allege, in addition to public nuisance, a host of additional legal claims, including design defect, failure to warn, negligence, and trespass; they name 37 defendants from the fossil fuel industry; and they seek a broad array of relief, including compensatory and punitive damages, injunctive relief, and disgorgement of profits.

Normally, this sort of kitchen-sink approach to litigation is not a problem: Many years and many cases later, the legal process will winnow those claims down to the ones most effective at getting relief for the plaintiffs. But, to borrow Justice Stewart’s description of death-penalty cases, climate litigation “is different,” and this approach seems destined to play into the hands of the defendants.

First, the large number of defendants in the San Mateo et al. approach is going to greatly slow these cases down. Many of these defendants will assert unique defenses that will have to be litigated. The plethora of defendants already has created problems: The initial complaints named Statoil, the Norwegian oil company, as a defendant. But Statoil is majority-owned by the Norwegian government, and as a sovereign entity Statoil was entitled to move the case from state court to federal court – which is not where the plaintiffs want to be. And while the plaintiffs quickly dropped Statoil after filing their complaints, they still are suing defendants that have just emerged from bankruptcy court: Arch Coal and Peabody Energy. Sure enough, Arch and Peabody dragged the case into federal court and invoked the protection of bankruptcy law.

This “sue them all” approach is both unwise and unnecessary: A small number of oil and gas companies have dominated fossil fuel production for many years and could likely be held jointly liable for the injuries (as just occurred in the lead paint case), meaning they would be on the hook even for damages caused by other fossil fuel companies. Adding all of the extra parties does not seem to serve much purpose.

Most importantly, the numerous claims San Mateo et al. have put into play will create unnecessary legal difficulties. For example, one of their claims is that fossil fuels are a defective product which, in a case like this, requires the jury to find (as the plaintiffs repeatedly allege) that the risks of the product outweigh its benefits. From the defendant’s viewpoint, having a jury weigh all the global benefits of fossil fuels against their harms allows them to make some of their favorite arguments (such as the “political question” doctrine) that attack the very idea that global warming issues can be resolved in court rather than by legislative and executive branch action. (For legal wonks out there, this is why the fossil fuel industry – unsuccessfully – went to great lengths in the last global warming tort case, Kivalina v. ExxonMobil Corp., to convince the Ninth Circuit Court of Appeals that this risk-utility balancing test was mandatory in the federal public nuisance claim at issue there.)

If this claim that fossil fuels are defective ever went to trial, defendants would happily introduce mountains of evidence regarding the societal benefits of fossil fuels around the world over the past several decades as compared to the harms of global warming. In short, San Mateo et al. have now injected into global warming litigation a balancing test that defendants simply love.

Their failure-to-warn theory also spells trouble. First, it invites the defendants to put San Mateo and Marin counties and Imperial Beach on trial by focusing on what the plaintiffs knew about global warming and when they knew it. And, oddly, even as the plaintiffs accuse the fossil fuel industry of failing to issue warnings about global warming, they also allege that in 1965 President Lyndon Johnson stated in a message to Congress that “[t]his generation has altered the composition of the atmosphere on a global scale through . . . a steady increase in carbon dioxide from the burning of fossil fuels.” The plaintiffs go on to say that, by 1982, Exxon made public its internal findings about global warming through publications “in at least three peer-reviewed scientific papers.” These allegations would seem to undercut the plaintiffs’ own failure-to-warn theory.

The San Mateo plaintiffs also have volunteered to prove that fossil fuels could have been phased out decades ago, and thus have alleged that technologies such as fuel cell vehicles and carbon capture and storage were viable in the 1960s and ’70s. This is likely to be a major – and completely unnecessary – fight.

San Mateo et al. also allege, repeatedly, that the defendants deliberately deceived policymakers, and should be held liable for “affirmatively and knowingly campaigning against the regulation of their fossil fuel products.” This plays right into the fossil fuel industry’s theme that global warming litigation unfairly targets its Constitutional rights, including the right to petition the government, and is an open invitation to a First Amendment battle (based, for you wonks, on the Noerr-Pennington doctrine). To be sure, the First Amendment does not protect fraud, but trying to impose liability based upon lobbying will play into the fossil fuel industry’s defense strategy.

Taking a bold legal step requires a carefully calibrated approach. Unfortunately, the decision by San Mateo et al. to throw in the kitchen sink unthinkingly plays into the fossil fuel industry’s hands. In fact, these well-intentioned cases may end up setting back legal efforts to hold fossil fuel companies liable for global warming injuries.

By sticking to a single, straightforward legal claim and a handful of defendants, the San Francisco-Oakland approach avoids all these problems, and is thus significantly more likely to succeed.

The post Global Warming Tort Litigation: Two Very Different Approaches appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/global-warming-tort-litigation-two-different-approaches/

Supreme Court takes Illinois union fees case again

The case could deal a major blow to the labor movement's finances and clout.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS04/170929872/supreme-court-takes-illinois-union-fees-case-again?utm_source=NEWS04&utm_medium=rss&utm_campaign=chicagobusiness

Playboy's Hugh Hefner dies at 91

He and his co-founder launched their magazine in Chicago, where he was born.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS06/170929873/playboys-hugh-hefner-dies-at-91?utm_source=NEWS06&utm_medium=rss&utm_campaign=chicagobusiness

Love the '80s? You'll be stoked to see this house

Full of glass brick, bright red accents and shiny black floors, the Northbrook home is right out of an episode of "Miami Vice."

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170928/CRED0701/170929874/love-the-80s-youll-be-stoked-to-see-this-house?utm_source=CRED0701&utm_medium=rss&utm_campaign=chicagobusiness

State moves to yank power-selling license from Texas firm

Spark Energy, which has operated here for nine years, can save its business, though, if it can prove to regulators it has the workforce and systems to address numerous customer complaints.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/NEWS11/170929876/state-moves-to-yank-power-selling-license-from-texas-firm?utm_source=NEWS11&utm_medium=rss&utm_campaign=chicagobusiness

My advice to Chicago bondholders: Sell

Thanks to funding increases, city of Chicago and CPS bond prices have risen, making this a smart time for risk-averse investors to cash out, writes an Edward Jones adviser.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170928/OPINION/170929879/my-advice-to-chicago-bondholders-sell?utm_source=OPINION&utm_medium=rss&utm_campaign=chicagobusiness

CareerBuilder lays off 120 after being acquired

The online job-listing company chopped 4 percent of its workforce this week, including 30 employees in its head office in Chicago.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/EMPLOYMENT/170929875/careerbuilder-lays-off-120-after-being-acquired?utm_source=EMPLOYMENT&utm_medium=rss&utm_campaign=chicagobusiness

Careerbuilder lays off 120 employees after being acquired

The online job-listing company chopped 4 percent of its workforce this week, including 30 employees in its head office in Chicago.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/EMPLOYMENT/170929875/careerbuilder-lays-off-120-employees-after-being-acquired?utm_source=EMPLOYMENT&utm_medium=rss&utm_campaign=chicagobusiness

Invesco to buy Guggenheim's ETF business

The $1.2 billion deal rounds out Invesco's offerings and lets Guggenheim focus on mutual funds.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS01/170929878/invesco-to-buy-guggenheims-etf-business?utm_source=NEWS01&utm_medium=rss&utm_campaign=chicagobusiness

From Political Ignorance to Political Polarization

In recent weeks I’ve argued in this space that the current political order—here and in most of the rest of the world—has the following features:

(1) It is egalitarian: The interests of each member of the polity are supposed to count equally.

(2) It is nationalistic: Its egalitarianism stops at the borders of each nation-state.

(3) It is democratic: Within those borders, not only are each person’s interests supposed to count equally, but each person is supposed to have an equal share of political power.

Each of these three components of the status quo is unremarkable on its own. Combined, however, they may shed new light on our present predicament.

Combining features (1) and (2), I’ve argued, produces “sociotropic nationalism.” (Sociotropic means “dedicated to the common good.”) A sociotropic nationalist aims to elect officials who will use public policy to further the common good. More specifically, the sociotropic nationalist tries to elect officials who will use public policy to solve the social and economic problems besetting the people of the country.

Combining sociotropic nationalism with feature (3) produces the sociotropic nationalist citizen. The sociotropic nationalist citizen participates in politics to advance the interests of his or her conationals. But that raises a problem: How can citizens know which policies, or parties, or politicians will advance their conationals’ interests? The task of sociotropic nationalist citizens brings with it tremendous epistemic demands, which may lead citizens to make grave mistakes.

The Complexity of Social and Economic Problems

Consider the types of knowledge a sociotropic-nationalist voter would need if he or she were to avoid mistakes. (This is not intended as a complete list.)

1. Knowledge of which purported social and economic problems are real and actionable at a given time, and which real, actionable problems are likely to crop up during the tenure of a potential office holder.
2. Knowledge of which real, actionable problems are or will be significant enough to have a claim on scarce public resources.

3. Knowledge of the sources of the significant, real, actionable problems. Arguably, at least, this requires the citizen to know what causes what in a modern society. The wider the relationship of societal causes and social and economic problems, the wider the citizen’s causal knowledge will have to be.

4. Knowledge of which policies will address the causes of real, actionable, significant social problems without imposing costs—anticipated and unanticipated—that outweigh the policies’ benefits. This type of knowledge is particularly important. It’s not enough to have a reliable causal diagnosis of real, significant, actionable social problems, or even a reliably proven treatment; one also needs to know that the treatment will not cause worse side effects than the disease. Thus, the citizen needs to know about unintended costs, not just costs that are budgeted or forecast.

5. Knowledge of which politicians or parties have the ability to push through net-beneficial policies to address the causes of significant, actionable social and economic problems.

 

Now on any given policy issue, full-time, life-long experts in economics, social theory, and political science may find themselves divided over what constitutes each of the five types of “knowledge.” Is a claimed social problem real? Is it significant? Is it actionable? What is its cause? Will the benefits of action outweigh the costs? Will this or that party or politician take the needed action? Typically, each of these topics is the subject of heated debate among experts.

When experts disagree with each other, it follows that the experts on one or the other side (or on both sides) must lack the necessary knowledge. (Even if the experts agree, of course, they may still lack the necessary knowledge; an expert consensus can be wrong.) If even experts can lack the necessary knowledge, should we really expect ordinary citizens with limited time to have it?

Logically speaking, we shouldn’t. Yet we do.

We’re taught to vote, and we’re taught that each vote counts. It follows that we should exercise our right to vote responsibly, by making ourselves “well informed.” Obviously, though, we aren’t expected to master the five types of knowledge listed above. That would be unreasonable.

So in practice, being “well informed” means, roughly speaking, that one has a passing familiarity with political controversies that are prominent in the news media at a given time. If you watch a half hour of news a day, you are, by most accounts, “moderately” informed. If you read a good newspaper, you are “well” informed. Yet the best newspaper in the world doesn’t convey a fraction of the knowledge listed above.

Ignoring Complexity

Democratic, sociotropic nationalism asks the impossible of us. It asks us, in effect, to stand above debates among technocratic experts and discern which of them are right. This would require that we-the-people adjudicate the substance of policy and political debate, which in turn would require that we-the-people become omnicompetent (omniscient?) super-technocrats ourselves. 

“Democratic sociotropic nationalism” can therefore be abbreviated as citizen technocracy: a polity that puts each of us in the untenable position of being a citizen-technocrat. A citizen-technocrat must be wiser, somehow, than technocrats of the usual sort—the experts whom political theorists call “epistocrats.”

If we wanted to question the legitimacy of citizen technocracy, we might begin with the gap between the epistemic demands placed on citizen-technocrats and their limited capacity to meet these demands. [1] But if we want to understand how citizen technocracy works in practice, we need to begin with a slightly different point: the fact that, as a rule, citizen-technocrats aren’t aware of this gap. To the extent that we, the people, hold opinions about technocratic policies (policies designed to address our conationals’ social and economic problems), and to the extent that we vote on the basis of those opinions, we cannot be fully aware of the unreliability of our opinions and our votes. If we gained this awareness, we would lose the confidence needed to hold the opinions and cast the votes. We would start answering survey questions “Don’t Know” and would withdraw from political participation. As Walter Lippmann wrote in Public Opinion,

There are two kinds of uninstructed voter. There is the man who does not know and knows that he does not know. He is generally an enlightened  person. He is the man who waives his right to vote. But there is also the man who is uninstructed and does not know that he is, or care. [2]

To function as citizen technocrats, we have to be like the second man. To carry out our political responsibilities (no matter how well or badly we carry them out), we must fail to recognize the extent of the knowledge we’d need if we were to carry them out well. That is, we must be “radically ignorant” of the knowledge we would need—unaware not only that we lack it, but that we need it. [3] The inadequacy of our knowledge must be an unknown unknown to us. Otherwise we wouldn’t be able to form political opinions or vote, let alone engage in more intensive forms of political action.

The Other Kind of Technocracy

Lippmann published Public Opinion in 1922, when the Progressive Era had peaked. He had been an ardent Progressive himself: a believer in citizen-technocracy. A socialist in college, Lippmann was hailed by his classmate John Reed (later the semi-official chronicler of the Russian Revolution) as the “all-unchallenged Chief” of the Harvard radicals. Later he helped to found The New Republic. But World War I gave many Progressives pause about the wisdom of the people. By the time Public Opinion appeared, Lippmann had come to think that we should substitute, for a technocracy run by citizen-technocrats, a technocracy in its ordinary usage: one run by epistocrats. 

Yet in order to go along with epistocracy, we’d have to believe that experts, unlike the rest of us, have reliable access to the five types of knowledge. What could justify this conclusion?

If “experts” are defined as those who are “knowledgeable” in an absolute sense, then by definition, epistocrats would have whatever knowledge they need. [4] But this definition complacently begs the real-world question of how epistocrats could acquire the needed knowledge; and the question of why, if acquiring this knowledge is feasible, they disagree with one other about what constitutes true knowledge about a given topic of controversy. [5]

Consider the fourth type of knowledge—knowledge of the intended and unintended effects that policies will have. We can’t just assume that some identifiable class of people will reliably know what the intended and unintended effects of policies will be, merely because we label them “experts.” Experts know more than non-experts. But that doesn’t entail that they know what they need to know if they are to make competent technocratic decisions.

The Self-Evidence Assumption

The need for the five types of knowledge suggests that social and economic problem solving is complex. Lippmann’s growing awareness of this complexity drove him away from the Progressive populism of his youth: the desire to place democratic “weapons in the hands of the people,” the better to force the government to solve the people’s problems. By 1922, he was advising withdrawal from what we would now call citizen activism, which he saw as epistemologically naïve.

The activist, however—even the “activist” whose sole political action is to vote—has to assume, in practice, that the world is simple. In fact, the activist tends to assume that the relevant truths about the world are self-evident. This assumption enables the activist to act in the face of what would otherwise be overwhelming uncertainty. A citizen-technocrat who truly understands the difficulties in obtaining the five types of knowledge will have no choice but to select him- or herself out of the electorate. The citizen-technocrats who remain in the electorate will be those who are insensible to these difficulties.

Take Donald Trump. As a candidate, he routinely treated his opinions as indisputable—even though they were based on such slender evidence that, once in office, he had to abandon them more quickly than had any president before him. After having repeatedly called Obamacare a “disaster” that he’d easily replace with something “beautiful,” he suddenly declared: “Nobody knew health care could be so complicated.” Likewise, “after listening [to Chinese President Xi Jinping] for 10 minutes,” he told The Wall Street Journal, “I realized that it’s not so easy. [Before,] I felt pretty strongly that they had a tremendous power [over] North Korea. . . . But it’s not what you would think.”

Political scientists have long worried about the political ignorance of most voters. In Donald Trump, their worst nightmare has come true. The personification of political ignorance has been parachuted into the Oval Office.

From Oversimplification to Polarization

Citizen-technocracy would be impossible without the widespread assumption that the truth about public policy issues is self-evident, or close to it—at least to the reader of a good newspaper. Only this assumption makes it possible for citizen-technocrats to believe that they have reliable (if not perfect) knowledge of whom to vote for on sociotropic grounds.

But while citizen-technocrats fail to recognize the knowledge problems they face, they cannot avoid recognizing the political problem they face: their political opponents.

Like epistocrats, citizen-technocrats disagree with each other. They disagree about which social and economic problems are real, which ones are actionable, which ones are significant, what their causes are, what the effects of proposed policies will be, and who can be trusted to implement net-beneficial policies. Yet if, as each of them is inclined to think, their own views about these matters are self-evidently justified, then how is it possible for anyone to disagree with them? As Diana Mutz once put it, puzzled citizens say to themselves, “The answers are obvious and we all agree on them. So what is wrong with all of those other people?”—that is, our political opponents.

There has to be something wrong with them insofar as they disagree with the self-evident truth. Maybe they’ve got psychological problems (they’re authoritarians, xenophobes, victims of “motivated reasoning,” snowflakes). Maybe they’re self-interested (not sociotropic). Maybe they’ve been bought off by special interests. [6] Maybe they’re liars, merely pretending to disagree even though they know they’re actually wrong. Maybe they’re evil.

Of course, such dark possibilities may truly explain the existence of a political opponent in a given case. But citizen-technocrats are inclined to leap to the conclusion that such things must be true of their political opponents because they fail to acknowledge what Rawls called the “burdens of judgment”: the “hazards involved in the correct (and conscientious) exercise of our powers of reason and judgment in the ordinary course of political life.” [7] Citizen-technocracy aggravates these burdens, as it requires us to be knowledgeable about abstruse and highly contestable matters of empirical fact in the ordinary course of political life.

In Lippmann’s words, one’s political opponent

presents himself as the man who says, evil be thou my good. He is an annoyance who does not fit into the scheme of things. Nevertheless he interferes. And since that scheme is based in our minds on incontrovertible fact fortified by irresistible logic, some place has to be found for him in the scheme. . . . Thus . . . out of the opposition we make villains and conspiracies. [8]

The Paradox of Citizen-Technocracy

Citizen-technocracy is not only impossibly demanding; it is highly paradoxical.

As a citizen-technocrat, I can participate in politics, whether by voting or through more persistent activism, only if I am first convinced that I know the truth about the social and economic problems

from nicholemhearn digest https://niskanencenter.org/blog/political-ignorance-political-polarization/

PRESS RELEASE: AN ENHANCED CHILD TAX CREDIT MUST IMPROVE REFUNDABILITY

Washington D.C., September 27, 2017 – As advocates for an expanded child tax credit, First Focus and the Niskanen Center welcome this morning’s “Big Six” Tax Statement, yet have reservations about the framework’s specifics.

“We applaud the Big Six in pledging a ‘significant increase’ to the Child Tax Credit in the framework released today. Regrettably, the framework also signals that the refundability of the Child Tax Credit will not change from current law,” say the Niskanen Center and First Focus in a joint statement.

“Organizations and policy experts from across the political spectrum agree that a larger, more refundable child tax credit would go a long way toward easing the crushing financial burdens facing working families. In contrast, the Big Six framework appears to use a larger Child Tax Credit to merely offset the elimination of the personal and dependent exemption, representing a bait and switch from the point of view of working class families.”

The Niskanen Center and First Focus believe that the tax package can and should be used to help families most in need. The groups have produced a bipartisan framework that includes principles that will make the Child Tax Credit work for everyone, giving kids from all walks of life the resources they need to grow up healthy and capable of achieving their full potential. For more information, visit www.expandthechildtaxcredit.com

The Niskanen Center is a Washington, D.C.-based libertarian think tank that works to change public policy through direct engagement in the policymaking process. First Focus is a nonpartisan advocacy organization dedicated to making children and families the priority in federal policy and budget decisions.

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The post PRESS RELEASE: AN ENHANCED CHILD TAX CREDIT MUST IMPROVE REFUNDABILITY appeared first on Niskanen Center.

from nicholemhearn digest https://niskanencenter.org/blog/press-release-enhanced-child-tax-credit-must-improve-refundablility/

Glass-topped dining cruise to sail Chicago River

Odyssey Chicago will launch cocktail, lunch and dinner excursions year round starting in July.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/BLOGS09/170929880/glass-topped-dining-cruise-to-sail-chicago-river?utm_source=BLOGS09&utm_medium=rss&utm_campaign=chicagobusiness

What's inside the GOP tax plan: A view from Roskam

As the president reveals his proposal today, the local congressman at the center of the debate underlines what's in the plan and what's out, and argues for why it should be passed.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/BLOGS02/170929882/whats-inside-the-gop-tax-plan-a-view-from-roskam?utm_source=BLOGS02&utm_medium=rss&utm_campaign=chicagobusiness

GOP plan has trillions in tax breaks for wealthy Americans

The president has said "the rich will not be gaining at all."

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS02/170929881/gop-plan-has-trillions-in-tax-breaks-for-wealthy-americans?utm_source=NEWS02&utm_medium=rss&utm_campaign=chicagobusiness

Is a Long or Short Term Commercial Lease Right For Your Business? - Pros and Cons to Consider

The following post is copyrighted by Austin Tenant Advisors - .

Pros and Cons to Consider

One of the most common questions I get asked is whether a business should sign a long term commercial real estate lease or a short term lease. For a small business or startup that is renting office, retail, or warehouse space getting this right is important as the success or failure of the business could be determined by the decision. Unfortunately there is no wrong or right answer as every company has different needs. Short and long term commercial leases both have certain advantages and disadvantages that you should analyze and discuss with your commercial real estate agent before you begin negotiations with a potential landlord.

 Advantages of a Long-Term Commercial Real Estate Lease

• More Leverage in Negotiations – You have the ability to negotiate better concessions such as a lower initial rental rate, lower annual rental increases, more money for tenant improvements, free rent, renewal options, and expansion options such as right of first refusal/offer. The longer the landlord has to recoup their initial rental costs the more concessions they typically will concede to. Concessions are possible with short term leases however harder to negotiate.
• Predictable Rental Costs – You will be able to lock in rates and forecast rent costs since you will know exactly what your rents will be from year to year during the lease term regardless of existing market conditions. With shorter lease terms you will likely be paying premium rents and higher yearly increases.
• Better Able to Plan for Future – Longer term commercial lease ensures you will be able to stay in one location for a set time period. It doesn’t matter if the building is sold you will have the peace of mind of not having to deal with office space stuff for a few years.

Cons of Long Term Commercial Leases

• Takes Longer to Negotiate – Longer leases can be more complex and cause negotiations to last a bit longer
• Less Flexible – Unless you negotiate to have some solid expansion or renewal options if you end up growing too quickly there may not be any space available for you to expand into. This means your only option will be to sublease the space and relocate. If you go out of business you will be stuck with trying to get out of the lease.

Advantages of a Short-Term Commercial Real Estate Lease

• Flexibility – For startup companies or business that are growing quickly you never know if and when you will need more or less space. If you decide you don’t like a particular location or space or you get that big deal and need to hire 30 more people you can easily pick up and relocate with a short term lease. 
• Contingency – It’s a know fact that most companies fail within the first 12-24 months of being in business. Having a short term lease will give you the ability to cut your losses and not have to pay the landlord a large sum of money to cancel the lease.

Cons of Short Term Commercial Leases

• Future Plans Less Predictable – When you are in a short term lease you typically are not able to negotiate renewal or expansion options which means the landlord can lease the space to someone else after your lease expires. 
• Rents Typically Higher – The landlord may charge a premium on rent with a short term lease especially in a hot market.
• Less Negotiation Leverage – You won’t have as much leverage to negotiate rental concessions such as free rent, tenant improvement allowances, etc.
• Hard to Find Space – In a hot market many landlords will not do short term lease deals which makes finding short term office space very difficult.

As you can see there are many Pros and Cons to signing short term and long term commercial leases. It’s hard to do however it’s important that you think of your business needs 1, 2, 3, 4, and 5 years down the road. If you are not sure you want to remain in the same location or expect future growth, or are just uncertain about the future of the company then a short term lease might be the best option. If your business is more established, financially stable, and not expecting to expand rapidly then you are better suited for a longer term commercial real estate lease.

The post Is a Long or Short Term Commercial Lease Right For Your Business? appeared first on Austin Tenant Advisors.

Here's how pop tax war is playing out in campaign cash

First came millions spent on TV ads about the controversial levy. Now, as a key repeal vote looms, some donors are giving to County Board members. And Mayor Emanuel's top fundraiser is in the mix.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/BLOGS02/170929884/heres-how-pop-tax-war-is-playing-out-in-campaign-cash?utm_source=BLOGS02&utm_medium=rss&utm_campaign=chicagobusiness

River North apartment tower hits the market

A Boston pension fund adviser has hired a broker to sell Flair Tower, a 198-unit high-rise built in 2010.

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170927/CRED03/170929885/river-north-apartment-tower-hits-the-market?utm_source=CRED03&utm_medium=rss&utm_campaign=chicagobusiness

How to get more women, minorities to own manufacturing firms

Chicago Ownership Conversion Project wants to match sellers of small firms with minority buyers. Ninety-nine percent of such manufacturing operations in Illinois are owned by white people.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS05/170929888/how-to-get-more-women-minorities-to-own-manufacturing-firms?utm_source=NEWS05&utm_medium=rss&utm_campaign=chicagobusiness

Fulton Market wholesaler wants in on the windfalls

Nealey Foods is trying to sell its pair of properties near Google's Midwest HQ in the now-trendy corridor.

from nicholemhearn digest http://www.chicagobusiness.com/realestate/20170927/CRED03/170929889/fulton-market-wholesaler-wants-in-on-the-windfalls?utm_source=CRED03&utm_medium=rss&utm_campaign=chicagobusiness

Trump's tax plan would let Congress decide rate for top earners

It's an effort to prevent the overhaul from providing too much of a benefit for the wealthy. And it will immediately set off a fight over how much top earners should pay.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS02/170929890/trumps-tax-plan-would-let-congress-decide-rate-for-top-earners?utm_source=NEWS02&utm_medium=rss&utm_campaign=chicagobusiness

Chicago companies rebuild in Puerto Rico after Maria

At least seven Chicago-area companies—nearly all in the pharmaceutical or medical device industries—have operations on the island that may be stalled.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS05/170929893/chicago-companies-rebuild-in-puerto-rico-after-maria?utm_source=NEWS05&utm_medium=rss&utm_campaign=chicagobusiness

The state needs to go all-in for the Toyota/Mazda car factory, too

Yes, Amazon is the prize Illinois really needs to win. But there's another employer shopping for a new home that's worth every effort, too.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/BLOGS10/170929897/the-state-needs-to-go-all-in-for-the-toyota-mazda-car-factory-too?utm_source=BLOGS10&utm_medium=rss&utm_campaign=chicagobusiness

Winston & Strawn sued for gender discrimination

A former partner in the San Francisco office alleges that the Chicago-based law firm linked her career to male attorneys.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/NEWS04/170929891/winston-strawn-sued-for-gender-discrimination?utm_source=NEWS04&utm_medium=rss&utm_campaign=chicagobusiness

Big names tapped to lead Amazon effort

Mayor Rahm Emanuel picks four CEOs to head a committee of 600-plus civic and community supporters.

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/BLOGS11/170929892/big-names-tapped-to-lead-amazon-effort?utm_source=BLOGS11&utm_medium=rss&utm_campaign=chicagobusiness

What city do we want to be?

Are we a city that wants to pour resources and effort into hiding homelessness? Or do we want to be a city that makes ending homelessness a priority?

from nicholemhearn digest http://www.chicagobusiness.com/article/20170927/OPINION/170929914/what-city-do-we-want-to-be?utm_source=OPINION&utm_medium=rss&utm_campaign=chicagobusiness

Austin Coworking Day is September 27th 2017

The following post is copyrighted by Austin Tenant Advisors - .

September 27th, 2017 is officially the first annual Austin Coworking Day thanks to Mayor Steve Adler and other community leaders. Out of the 40 locally owned and operated coworking facilities in the Austin Metro area 18 of them have agreed to open their doors for a FREE day of coworking. Also, to give people a taste of what coworking spaces have to offer there will be events, coaching, and special workshops. For your reference here is a complete list of coworking spaces in Austin.

Austin coworking spaces give members the ability to work, connect and collaborate with others rather than working in isolation at home.  Each location in Austin has its own vibe and unique look so to find the one that best suits you you might consider visiting a few of them if you have the time.

If you are interested in learning more about coworking just go to the Eventbrite invitation here and claim your free ticket.

Below is a map of the participating coworking spaces in Austin

The post Austin Coworking Day is September 27th 2017 appeared first on Austin Tenant Advisors.