282 (14 September 2016)

Welcome to week 282!  The articles below caught my attention this week.  Please note that what are intended to be relatively objective “briefs” are preceded by dashes (——–), whereas additional material or relatively subjective comments are preceded by asterisks (********).  The links to articles preceded by [SR] require a subscription to be read in their entirety, although complete articles may frequently be found by an Internet title search.

(8 September 2016): “Killing Off American Cows to Keep Milk Prices High” (http://www.bloomberg.com/news/articles/2016-09-08/cow-killing-and-price-fixing-in-your-supermarket-dairy-aisle)

——–“Although American demand for dairy has risen steadily for almost 40 years, some farmers tried to limit the supply of milk by killing off their own cows. . . . This mysterious state of affairs was revealed in a nationwide class-action lawsuit against dairy cooperatives, groups of farmers who pool their supplies but, as a whole, serve as middlemen between the farmers and dairy processors.  In this case, lawyers from one of the premier U.S. plaintiffs’ firms alleged on behalf of American consumers that the cooperatives paid farmers to prematurely turn hundreds of thousands of cows into burgers in a sprawling scheme to prop up dairy prices.”  This week the defendants settled for $52 million.  The antitrust case “pulls the curtain back on a highly complex sector of the U.S. agricultural economy.”  The initiative that led to the premature deaths of many dairy cows, known as the “herd retirement program,” was spearheaded by “Cooperatives Working Together, run by the lobbying group National Milk Producers Federation, and supported by farms producing almost 70 percent of America’s milk.”

********Of course, it is easy to understand that an individual dairy farmer, when confronted by low prices for milk, may wish to sell his cows.  What was at issue in this case, however, was that “cooperatives paid above-market prices for dairy cows owned by member farmers, and sent them to be slaughtered before they would have otherwise.”  It was this collective action managed through the cooperatives that ran afoul of the 1922 Capper-Volstead Act.  You can learn more about the Act at: https://en.wikipedia.org/wiki/Capper%E2%80%93Volstead_Act.

(8 September 2016): “Private Prisons Have a Problem: Not Enough Inmates” (http://www.bloomberg.com/news/articles/2016-09-08/private-prisons-have-a-problem-not-enough-inmates)

——–“With overall violent crime rates falling nationally and fewer people getting sentenced to long stretches behind bars, private prison companies see a potentially catastrophic decline in demand for their services.  Their response: diversify into everything from halfway houses to neighborhood check-in centers for drug offenders.”  The primary reason for the decline is the curtailment of “harsh mandatory-minimum sentences and other changes in criminal justice policies have combined to reduce federal and state inmate head counts.”  Although recent announcements by the federal government indicate a move away from private prisons [(https://www.washingtonpost.com/news/post-nation/wp/2016/08/18/justice-department-says-it-will-end-use-of-private-prisons/)], the same is not true at the state level.  As a result, “state-issued private prison contracts appear to be more secure because state penal systems remain more crowded than their federal counterparts.”

********The stock prices of Corrections Corp. of America and Geo Group, both large providers of prison services, “have each sunk by more than 30 percent . . . Thus the drive for diversification.”  How would public prisons and prison systems respond to such a decline?  It is useful to note that it is the legal system is a central factor in creating the demand for prison services.  Just as legislation can decrease the demand for services, so can in create it.  An illustration of this point is provided by “Inmate Populations Rise Again in Some States” [SR](http://www.wsj.com/articles/inmate-populations-rise-again-in-some-states-1473725090).  Contributing to these localized increases is an “epidemic of opiate addiction and a handful of high-profile crimes.”  Arkansas, in particular is an example of a state that “in 2011 passed a landmark law to reduce harsh drug sentences, as a way to curb costs from overcrowded prisons.”  The result was a 10% drop in prison population over two years.  But a 2013 carjacking and shooting by a parolee led state officials to tighten parole policies.  Now “Arkansas’s prisons are more crowded than they were before the 2011 legislation.”

********On a related topic, inmates across the country recently protested their pay and living conditions at the time of the 45th anniversary of Attica.  More detail is provided in “Prisoners Stage Coordinated Strikes in Several States” (http://www.wsj.com/articles/prisoners-stage-coordinated-strikes-in-several-states-1473895389).  According to the article, the pay level at one prison ranges from “74 cents a day to $3.34 a day.”

(9 September 2016): “Chinese Billionaire Linked to Giant Aluminum Stockpile in Mexican Desert” (http://www.wsj.com/articles/chinese-billionaire-linked-to-giant-aluminum-stockpile-in-mexican-desert-1473356054)

——–“Two years ago, a California aluminum executive commissioned a pilot to fly over the Mexican ton of San José Iturbide . . . and snap aerial photos of a remote desert factory.  He made a startling discovery.  Nearly one million metric tons of aluminum sat neatly stacked behind a fortress of barbed-wire fences.  The stockpile, worth some $2 billion and representing roughly 6% of the world’s total inventory . . . quickly became an obsession for the U.S. aluminum industry.  Now it is a new source of tension in U.S.-Chinese trade relations.  U.S. executives contend that the mysterious cache was part of a brazen scheme by one of China’s richest men to game the global trade system.”  It is argued that billionaire Liu Zhongtian “tried to evade U.S. tariffs by routing aluminum through Mexico to disguise its origins, a tactic known as transshipping.”  Subsequently, as series of developments has resulted in the reduction of the size of the “giant pile of aluminum . . . plans are afoot to ship the metal stash to a Vietnam site owned by Global Vietnam Aluminum Co.”

********Wikipedia has a brief article about transshipment (https://en.wikipedia.org/wiki/Transshipment), noting that it “is normally fully legal and an everyday part of world trade.  However, it can also be a method used to disguise intent, as is the case with illegal logging, smuggling, or grey-market goods.”  This is another article where consistency among statements on the same thing is hard to find.  For that reason, it might be beneficial to take a look at “The post-truth world: Yes, I’d lie to you” (http://www.economist.com/news/briefing/21706498-dishonesty-politics-nothing-new-manner-which-some-politicians-now-lie-and).

(13 September 2016): “How the Sugar Industry Shifted Blame to Fat” (http://www.nytimes.com/2016/09/13/well/eat/how-the-sugar-industry-shifted-blame-to-fat.html)

——–“The sugar industry paid scientists in the 1960s to play down the link between sugar and heart disease and promote saturated fat as the culprit instead, newly released historical documents show.  The internal sugar industry documents, recently discovered by a researcher at the University of California, San Francisco, and published Monday in JAMA Internal Medicine, suggest that five decades of research into the role of nutrition and heart disease, including many of today’s dietary recommendations, may have been largely shaped by the sugar industry. . . . The documents show that a trade group called the Sugar Research Foundation, known today as the Sugar Association, paid three Harvard scientists the equivalent of about $50,000 in today’s dollars to publish a 1967 review of research on sugar, fat and heart disease.  The studies used in the review were handpicked by the sugar group; and the article, which was published in the prestigious New England Journal of Medicine, minimized the link between sugar and heart health and cast aspersions on the role of saturated fat.”

********There is no surprise that an organization would “go shopping” for people and arguments that support its interests.  All this is effectively illustrated in Merchants of Doubt and is the lifeblood for lobbyists and the organizations that employ them.  What is surprising, though, is three Harvard researchers were caught up in the effort.  Although many journals now require disclosure of funding sources, it is easy to see why Dr. Walter Willett, the chair of the nutrition department of the Harvard T.H. Chan School of Public Health, says that the situation serves as a reminder of “why research should be supported by public funding rather than depending on industry funding.”  This comes, though, at a time when public support of universities is declining.

********A valuable complementary piece form “The Opinion Pages” is “The Shady History of Big Sugar” (http://www.nytimes.com/2016/09/17/opinion/the-shady-history-of-big-sugar.html).  It provides a look at how the industry has, over 150 years, “shaped government policy in order to fuel our sugar addiction.  Today’s sugar industry is a product of the 1th century, when the key federal sugar policy was not a dietary guideline but a tariff on sugar imports.”  The Opinion is by David Singerman, an historian of science.  He wrote with such authority and ease that I gathered he had written about the subject previously.  Indeed, his doctoral dissertation is “Inventing purity in the Atlantic sugar world, 1860-1930” (https://dspace.mit.edu/handle/1721.1/93812).  A recent book on by April Merleaux, Sugar and Civilization: American Empire and Cultural Politics of Sweetness (https://www.amazon.com/Sugar-Civilization-American-Cultural-Sweetness/dp/1469622513/), seems to provide a nice complement.  The desire for “sweetness” is imaginatively examined by Michael Pollan in the first chapter of his book The Botany of Desire (https://www.amazon.com/Botany-Desire-Plants-Eye-View-World/dp/0375760393/).  There the apple is the source of sweetness, at least for those non-Native Americans who settled what is now the United States.

********An article that is related to the one on the sugar industry is “Can ExxonMobil Be Found Liable for Misleading the Public on Climate Change?” (http://www.bloomberg.com/news/articles/2016-09-07/will-exxonmobil-have-to-pay-for-misleading-the-public-on-climate-change).  The relationship I have in mind is the concealment of information that is contrary to the interests of an organization, as well as the intentional promotion of information that is contrary to the information being concealed.  I guess this tends to fall under the categories of secrecy and lying.  As it turns out, Sissela Bok has written effectively and interestingly on both topics.  With regard to the former, there is Secrets: On the Ethics of Concealment and Revelation (https://www.amazon.com/Secrets-Concealment-Revelation-Sissela-Bok/dp/0679724737/), with regard to the latter, there is Lying: Moral Choice in Public and Private Life (https://www.amazon.com/Secrets-Concealment-Revelation-Sissela-Bok/dp/0679724737/).  In the ExxonMobil article, the Racketeer influenced and Corrupt Organizations Act (RICO Act), plays an important role.  If you read the first paragraph of the Wikipedia article on it (https://en.wikipedia.org/wiki/Racketeer_Influenced_and_Corrupt_Organizations_Act), you will be able to get a sense of its importance for the sugar article and the ExxonMobil article.  The RICO Act played an important role in the earlier prosecution of cigarette companies.

May you have a good week!

Bruce

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