A18| Monday, October 7, 2019 THE WALL STREET JOURNAL.
New York Rent Law Hurts Tenants, Workers
Joshua Stein hits the nail on the
head in describing the damaging ef-
fect of New York state’s new rent
regulation on the housing market
(“How to Kill a Housing Market,”
Cross Country, Sept. 28). The land-
lords aren’t the only losers here.
My company provides design and
construction services for several res-
idential property owners. I’ve wit-
nessed firsthand how the improve-
ments and beautification of
residential lobbies, corridors and
apartments changed the lives of low-
income tenants. The residents be-
havior changed. They were proud to
live in a renovated building. The pre-
viously trash-filled corridors were
kept clean. The well-lit corridors and
new security devices helped reduce
drinking and drug use. The build-
ings’ supers were telling me that the
residents aren’t complaining as they
used to, because everyone is happy.The new rent-control law has
brought all this progress to a
screeching halt. All renovations are
on permanent hold. Many vendors
that depended entirely on housing
renovations closed shop. My friend
who was in the kitchen cabinet in-
stallation business laid off his crew
of 25 installers. He’s selling his
house to be able to sustain his fam-
ily. My friend, a contractor who ren-
ovated apartments in the Bronx for
the last 20 years, closed shop.
Ninety of his skilled construction
workers are looking for new jobs.
The domino effect from this legisla-
tion is greater than anyone could
have predicted. But the saddest part
is that the people whom this was
supposed to help are the ones who’ll
end up suffering the most. What
were the legislators thinking?
SHIFRAMENDELOVITZ
Brooklyn, N.Y.LETTERS TO THE EDITOR
Letters intended for publication should
be addressed to: The Editor, 1211 Avenue
of the Americas, New York, NY 10036,
or emailed to [email protected]. Please
include your city and state. All letters
are subject to editing, and unpublished
letters can be neither acknowledged nor
returned.“When you asked if I was
a self-starter, does that mean
with or without coffee?”THE WALL STREET JOURNALTrump’s Moved the Needle on Chinese Trade
Regarding your editorial “Commu-
nist China Turns 70” (Oct. 1): You
have been a consistent critic of Presi-
dent Trump’s trade war with China,
observing five months ago in your
editorial “The Cost of China Tariffs”
(May 14) that the Dow Jones Indus-
trial Average then was 1300 points
lower than it was in January 2018
when Mr. Trump began his offensive.
The Dow is now up a little since the
trade war’s inception.
You acknowledge that “Donald
Trump’s policies have exposed a vul-
nerability in China’s export-depen-
dent economic model that relies too
much on theft and predatory behav-
ior.” Do you think that China’s vul-
nerability would have been exposed
absent what you previously referred
to as President Trump’s “high-risk
coercive showdown with the world’s
second largest economy”?In an ideal world of free-market
economies, democratic regimes and
principled global competitors, tariffs
are mutually assured economic de-
struction weapons, but China obvi-
ously plays by its own rules. You
recommended that the Trump ad-
ministration work with allies and in-
ternational bodies to form a united
front in further discussions with
China instead of igniting a trade
war. Do you still think that China
would have relented and reformed
without U.S. confrontation and an
economic drag on its economy?
Granted, an authoritarian regime is
extremely dangerous when cornered,
but at least Xi Jinping knows that
the U.S. under President Trump
won’t buy cheap rope from China in
order to hang itself.
TIMLIVINGSTON
Alexandria, Va.Democrats May Get a Triple Play on Trump
Regarding Karl Rove’s “Pelosi’s
Circular Firing Squad” (op-ed, Sept.
26): Three years ago Democrats went
ballistic when private Democratic
National Committee emails were
leaked. But if they no longer expect
private conversations between the
White House and foreign leaders to
be confidential, it seems that any
communication among politicians,
political operatives and foreign offi-
cials ought to be fair game for public
airing. In the interest of transpar-
ency, a deep dive into the U.S.-
Ukraine relationship ought to start
with Joe Biden’s demand in 2016
that Ukraine fire a special prosecutor
who was investigating corruption at
a company on which Mr. Biden’s son
served on the board (for a monthly
stipend of $50,000). Mr. Biden
bragged at a Council on Foreign Re-lations gathering that he told
Ukraine officials that U.S. approval of
a billion-dollar loan guarantee was
conditional: “I looked at them and
said: I’m leaving in six hours. If the
prosecutor is not fired, you’re not
getting the money.” Sounds like a
quid pro quo and threat.
The bigger risk for those of us not
in the Democratic camp is that im-
peachment high jinks are so disrup-
tive and create so much uncertainty
that the economy and capital markets
tank in 2020. The big beneficiaries of
economic misery will be Democrats,
as was the case in 2008. At that
point, the transparency blessing of a
bogus impeachment inquiry will be
swamped by the curse of a blue tide
surging toward socialism.
MATTJOHNSON
Charlotte, N.C.Pepper ...
And SaltSociety Should Better Support All Mothers
My message that mothers are valu-
able to society and that children need
their mothers in the first three years
for their emotional security and men-
tal health isn’t a dated message but a
necessary and timely one. I truly
must have hit a nerve with so many
responses (Letters, Sept. 30) to my
“A Woman Doesn’t Need an Office to
Be Empowered” (op-ed, Sept. 21) on
the value of mothers to society.
The defensiveness of so many to
the concept that a woman’s value is
so much more than how much she
earns only reinforces my concern that
society has overlooked nurturing asthe most important labor. A maternal
economy doesn’t preclude women
from working or earning money, or
striving to achieve great things in
their careers; however, it does elevate
women who choose to prioritize
mothering as of equal value to those
who work for pay.
Many women cannot choose to
stay home with their children for fi-
nancial reasons, which is why I have
always advocated policies that sup-
port all women or primary caregivers
to be able to stay home with their
childreninthefirst1,000days
through paid maternity leave. We
have to do even more to increase op-
portunities for mothers or primary
caregivers to work part-time or flexi-
bly so they may maximize their time
with their children.
My central message has always
been and always will be that the
needs of children must come first and
mothers are essential to their emo-
tional development.
ERICAKOMISAR,LCSW
New YorkDemocrats Are Poisoning
The Supreme Court’s Well
Regarding David B. Rivkin and Lee
A. Casey’s “Probe the Effort to Sink
Kavanaugh” (op-ed, Sept. 30): The
continued attacks on Justice Brett
Kavanaugh may be a double-edged
sword. The first edge is obvious, un-
dercut the credibility of Justice Ka-
vanaugh’s judicial opinions. The sec-
ond is more subtle, attacks reaching
back to the justice’s time in high
school may serve to deter very capa-
ble people from accepting an appoint-
ment to the Supreme Court. The tim-
ing for creating such apprehension
may not be inadvertent, as the next
appointment, if it occurs under Presi-
dent Trump, will likely swap a liberal
for a more conservative justice. How
might a spouse of a potential nomi-
nee react about accepting such an ap-
pointment knowing the real or sur-
real dirty personal laundry that will
be displayed in front of his or her
family and throughout the nation?
VICTORE.SCHWARTZ
Alexandria, Va.King Warren of the Roundtable
W
ell, that didn’t take long. In August
the knights of the Business Round-
table announced that they are put-
ting “stakeholders” ahead of
shareholders as their primary
business purpose. Now Sena-
tor Elizabeth Warren, who is
rising in the presidential
polls, is demanding that
these CEOs prove they mean
it by endorsing her grand design to remake
American capitalism.
“I write for information about the tangible
actions you intend to take to implement the
principles” in the Roundtable’s Statement on
the Purpose of a Corporation, Sen. Warren
wrote to JPMorgan CEO Jamie Dimon and other
CEOs late last week.
Her letter then denounces corporate profits,
stock buybacks and dividends that she says
leave workers behind. “I am pleased that the
Business Roundtable has acknowledged the
harm that this trend inflicts on the economy
and that you, on behalf of JP Morgan Chase,
have pledged to take steps to reverse it,” the
letter adds.
“If you, and the other 181 corporate execu-
tives who signed the BRT’s new Statement on
the Purpose of a Corporation, plan to live up to
the promises you made, I expect that you will
endorse and wholeheartedly support the re-
forms laid out in the Accountable Capitalism
Act to meet the principles you endorse. I have
attached a copy of the bill.”
You have to love that “I expect” line. She’s
not President yet, but she’s already giving or-
ders to CEOs about how to behave if they know
what’s good for them. Very Trumpian. And en-
tirely predictable.
The Roundtable CEOs hoped to put them-
selves on stronger political ground by explain-
ing how successful businesses serve more than
shareholders. The left responds to this truism
by claiming that even CEOs now think capital-
ism is immoral and demanding that they cede
corporate control to political actors. The
Roundtable has succeeded in energizing Ms.
Warren and the left to believe they can scare
business leaders into political retreat.
And make no mistake, Ms. Warren’s Account-
able Capitalism Act would end capitalism as we
know it. Every company with revenue of more
than $1 billion would have to obtain a new fed-
eral charter, in contrast to the current system
of state charters.
Instead of serving the interests of the share-
holders who own the company, CEOs and direc-
tors would have to serve some combination of
“the workforce,” “customers,” “the local and
global environment” and “community and soci-
etal factors.” Forty percent of
directors would also have to
be employees, which would
usually mean union represen-
tatives.
How this would work in
practice is anyone’s guess,
other than that it would subject every decision
to vetoes by social-justice warriors, unions,
trial lawyers and politicians. As Phil Gramm and
Mike Solon recently wrote on these pages, the
capital and life savings invested in U.S. corpora-
tions would soon be devoured by these multiple
and often competing political interests.
This can’t be what the Roundtable CEOs
signed up for, and it will be fascinating to see
how they respond to Ms. Warren’s effort at po-
litical intimidation. It would be a mistake to dis-
miss her letter as mere grandstanding for the
Democratic primaries. The Senator is now the
frontrunner for the Democratic nomination,
which given Donald Trump’s vulnerabilities
means she is the favorite to become the next
President.
If you don’t think she’s serious about her pol-
icies, ask Obama Treasury Secretary Tim Geith-
ner or Antonio Weiss, the Democratic banker
she blocked for a job at Treasury. If she wins
with a Democratic House and Senate, all of her
agenda becomes politically achievable.
iii
Yet the lesson of Ms. Warren’s letter to CEOs
is less about her agenda than it is about the ob-
ligations of business in a free society. In a 1970
essay, Milton Friedman wrote about “the short-
sightedness” of executives who give speeches
about social responsibility.
“This may gain them kudos in the short run,”
the great economist wrote. “But it helps to
strengthen the already too prevalent view that
the pursuit of profits is wicked and immoral and
must be controlled by external forces.” Once
this view is widely believed, the result won’t be
control by “social consciences” or “pontificat-
ing executives” but by “the iron fist of Govern-
ment bureaucrats.”
CEOs can’t buy off Mrs. Warren and the left
with this or that rhetorical or policy concession.
Her intention is to co-opt and redirect the capi-
tal that business and individuals now control.
The only way to defeat this threat is to defend
the morality of free markets and the moral and
fiduciary duty of corporations to their share-
holder owners.The Senator orders the
‘stakeholder’ CEOs to
endorse her agenda.
Senators Answer Beijing’s Bullying
C
hina’s revisionism in the South Pacific
continues as it bullies and bribes re-
gional states to revoke diplomatic rec-
ognition of Taiwan. In Sep-
tember two of Taiwan’s
scarce allies in the region, the
Solomon Islands and Kiribati,
broke with Taipei in favor of
Beijing.
U.S. lawmakers have taken
notice. Two weeks ago the Senate Foreign Rela-
tions Committee unanimously referred the Tai-
wan Allies International Protection and En-
hancement Initiative, or Taipei Act, to the full
Senate. The bill aims to combat Taiwan’s isola-
tion. It calls for a U.S. free-trade deal with Tai-
wan and greater Taiwanese membership in inter-
national institutions, which China increasingly
tries to block. The bill also directs the secretary
of State to induce governments to strengthen
ties with Taiwan and suggests the secretary
withhold economic and military aid from coun-
tries that downgrade relations.
Some might ask why the U.S. should spend
fiscal and diplomatic capital to influence far-off
statelets like the Marshall Islands. The answer
is that the U.S. has an interest in supporting Tai-
wan, a loyal democratic ally, against Chinese ef-
forts to squeeze it diplomatically and ultimately
encroach on its sovereignty as it is doing to
Hong Kong’s autonomy.
The political balance in the Pacific is also im-
portant to U.S. security. The open economic or-
der in Asia has been undergirded since the 19th
century by American naval power. As Pacific
states get into bed with Beijing, the U.S. military
position in the Pacific is coming under pressure.
China may gain bases from which to threaten
U.S. troops and allies like Australia.
The U.S. wants to co-exist
with China as a law-abiding
global power. But China under
President Xi Jinping shows ev-
ery sign of wanting to over-
throw the U.S.-led interna-
tional system in the Pacific and
impose economic mercantilism and its political
dominance.
The advance of the Taipei Act, introduced by
Colorado Republican Cory Gardner, comes a lit-
tle over a month after the Trump Administration
approved the sale of 66 advanced F-16 fighter
jets to Taiwan. President Obama had declined
to approve the sale, fearing a Chinese backlash.
Yet China’s response has been muted, and Presi-
dent Trump’s decision has been met with bipar-
tisan assent in Congress. He’s right not to give
Beijing a veto over U.S. foreign policy.
The F-16s will help Taiwan deter a Chinese
seizure of the island. President Xi has said Tai-
wan must be “reunified” with the mainland,
and China periodically issues threats and holds
military exercises that resemble invasion prac-
tice. It also tries to meddle in Taiwan’s presi-
dential politics, though this year its handling
of Hong Kong seems to be backfiring and could
help current President Tsai Ing-wen win re-
election.
The Taipei Act is a useful response to Chi-
nese behavior and a demonstration that a bipar-
tisan coalition stands behind U.S. allies in the
Asia-Pacific.Congress advances a bill
to enhance Taiwan’s
diplomatic standing.
A Judicial Abortion Test
O
ne tragedy ofRoe v. Wadeis that it
has turned any state regulation of
abortion into a judicial controversy.
And even the mildest regula-
tion gets presented as some-
thing that threatens all ac-
cess to abortion. The
Supreme Court agreed to en-
ter this thicket again on Fri-
day by acceptingGee v. June
Medical Services.
Abortion providers are challenging a Loui-
siana law that requires doctors who perform
abortions to have admitting privileges at a
nearby hospital. The plaintiffs argue the Loui-
siana law is similar to a Texas law the Court
struck down in 2016 and that it would force
the closure of every abortion clinic in the
state save one. The Texas case, Whole
Woman’s Health v. Hellerstedt, was decided
5-3 after Antonin Scalia had died and with An-
thony Kennedy in the majority.
The Louisiana law does not directly chal-
lenge the constitutional right to abortion that
Roedeclared. But the Fifth Circuit Court of
Appeals upheld the state regulation, which
abortion-rights supporters fear could chip
away atRoeby opening the door to increasing
state restrictions and regula-
tions.
This is the first abortion
case for the Court since Jus-
tice Kennedy retired, and the
votes of only four Justices
are required to take a case.
Perhaps the four liberals want to see where
new Justices Neil Gorsuch and Brett Ka-
vanaugh come down on abortion regulation.
Or perhaps the conservative Justices took the
case because it is the kind of modest regula-
tion that can be upheld without overturning
core abortion precedents.
The decision is politically fraught as it will
likely be handed down next year in the heat
of a presidential campaign. ButGeeis an ideal
case for the Court to hear if the new Justices
see the constitutional space to widen, step by
incremental judicial step, the ability of the po-
litical branches to legislate the practice of
abortion.The Supreme Court
agreestohearaLouisiana case.
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