The World and Everything in It - April 26, 2021

MARY REICHARD, HOST: Good morning!

The United States gave Temporary Protected Status to a couple from El Salvador. Now they seek permanent residency on that basis.

That’s ahead on Legal Docket.

NICK EICHER, HOST: Also, the Monday Moneybeat: today we’ll talk about the Biden tax plan for capital gains and what it may mean for future economic growth.

Plus, the WORLD History Book. Today, the 40th anniversary of a technological advancement in personal computing.

REICHARD: It’s Monday, April 26th. This is The World and Everything in It from listener-supported WORLD Radio. I’m Mary Reichard.

EICHER: And I’m Nick Eicher. Good morning!

REICHARD: Up next, Jill Nelson with today’s news.

JILL NELSON, REPORTER: Johnson and Johnson shots resume » COVID-19 vaccine clinics across the country resumed use of the Johnson & Johnson shot over the weekend. On Friday, federal health officials lifted an 11-day hold on the vaccine.

Dr. Francis Collins, who directs the National Institutes of Health, told NBC’s Meet the Press the vaccine’s benefits outweigh the risk of blood clots.

COLLINS: Someone has pointed out, you are less likely as a woman taking J&J to have this blood clotting problem than to be struck by lightning next year. So, it’s a really low risk.

The government paused use of the Johnson &Johnson shot after 15 women developed a highly unusual blood clot. Three died and seven remain hospitalized.

But 8 million people have had the Johnson & Johnson vaccine, making the likelihood of developing the clots extremely rare.

More than 50 percent of Americans have had at least one vaccine dose so far. And health officials hope resuming use of the single-dose J&J shot will boost those numbers. White House medical adviser Dr. Anthony Fauci told ABC’s This Week that could make a difference in pandemic restrictions.

FAUCCI: I think it’s pretty common sense now that outdoor risk is really really low. Particularly, I mean, if you are a vaccinated person, wearing a mask outdoors, I mean obviously the risk is miniscule.

Fauci said the Centers for Disease Control and Prevention could soon issue new guidance on wearing masks in public.

Biden recognizes Armenian genocide »

SOUND: SINGING

Armenian Americans gathered in Southern California on Saturday to remember family members killed by the Ottoman Empire more than a century ago.

An estimated 1.5 million Armenian Christians died in the ethnic cleansing campaign during World War I.

President Biden marked the day by recognizing the systematic killing as a genocide. He was the first sitting U.S. president to do so. Those who gathered in Los Angeles celebrated the milestone.

SOUND: I'm happy that my children are witnessing the day. We worked very hard to see America recognize the Armenian genocide. And so this is a new beginning for us. I feel it's a new beginning for my children.

Successive American presidents had avoided using the term genocide in deference to Turkey, a NATO ally. Turkey contends both sides suffered casualties in the conflict.

Following the White House announcement, Turkey’s foreign ministry summoned the U.S. ambassador in Ankara to condemn Biden’s use of the term.

Hospital fire kills dozens in Iraq »

SOUND: SIRENS, HORNS

Fire ripped through the intensive care unit of a Baghdad hospital on Saturday after an oxygen cylinder exploded. At least 82 people died and more than 100 suffered injuries.

Most of the victims were being treated for severe cases of COVID-19.

Iraq’s prime minister blamed the fire on widespread negligence. Following a special cabinet meeting, the government suspended key officials, including the health minister and the governor of Baghdad province.

Iraq is struggling through a second wave of coronavirus cases. Daily case counts now average around 8,000. That’s the highest level since the country began keeping records early last year.

Indonesia locates wreckage of missing sub » The Indonesian military has located the wreckage of a submarine missing since last week.

MAN: SPEAKING INDONESIAN

The military chief said all 53 crew members are dead.

The vessel disappeared during a routine training mission off the coast of Bali. Crews from Singapore, Australia, and the United States joined the search effort in hopes of finding the sub before the crew ran out of oxygen.

But after locating the wreckage in three pieces on the ocean floor, Indonesian officials said it was clear no one could have survived the accident. The submarine is sitting more than 27-hundred feet below the surface. That’s four times the depth its hull was built to withstand.

Academy Awards » Hollywood gathered for the 93rd Academy Awards Sunday night. But the annual Oscars ceremony looked very different from years past. WORLD’s Leigh Jones reports.

LEIGH JONES, REPORTER: No crowds gathered to watch celebrities parade down the red carpet. No host moved the event along. And no audience, other than the nominees themselves, stood to cheer for the winners.

But the biggest pandemic-related change came in the types of films that took home awards. For the first time, movies didn’t need a theatrical run to score a nomination.

Top honors went to Nomadland, a drama about itinerant life in the American West. It won best picture, and director Chloé Zhao made history for winning the best director award. She is only the second woman to win in that category and the first woman of color.

Frances McDormand won best actress for her role in Nomadland. And Anthony Hopkins won best actor for his role in The Father.

Yuh-Jung Youn became the first Korean actress to win an Academy Award. She was named best supporting actress for her role in Minari. Daniel Kaluuya won best supporting actor for Judas and the Black Messiah.

And Pixar scored its 11th best animated feature Oscar for Soul.

Reporting for WORLD, I’m Leigh Jones.

And I’m Jill Nelson.

Straight ahead: sentencing minors to life in prison.

Plus, the desktop computer gets a new sidekick.

This is The World and Everything in It.

MARY REICHARD, HOST: It’s Monday morning and here we are for another week of The World and Everything in It. It’s April 26th, 2021 and we’re glad you’re along with us today! Good morning. I’m Mary Reichard.

NICK EICHER, HOST: And I’m Nick Eicher. It’s time for Legal Docket.

The U.S. Supreme Court handed down three opinions last week.

First, a 6-3 conservative majority decision on minors convicted of capital murder. The decision holds that before imposing on a minor a sentence of life without parole, states have no obligation to make a specific finding of permanent incorrigibility in the offender.

The offender Brett Jones was 15 when he killed his grandfather. Jones challenged his sentence of life without parole because the judge did not make a separate, factual finding that Jones is permanently incorrigible.

Jones wanted a new trial to determine this character issue.

But during oral argument, Justice Samuel Alito—in this exchange with Jones’s lawyer—hinted at the eventual ruling.

ALITO: This is fascinating. You want to take us and you want us to take the courts of this country into very deep theological and psychological waters.

The court declined to wade into those deep waters and found that the sentencing judge considered factors related to incorrigibility.

That was sufficient to meet constitutional standards.

A bitter dissent from the three liberal-leaning justices said the opinion is an abrupt break from precedent and gets the analysis wrong.

REICHARD: Now for the second opinion, this one unanimous. The high court ruled you can dispute the validity of an administrative law judge even after the agency first hears the case.

Here, individuals denied social security disability benefits challenged the way the administrative judge earned his appointment to the bench. The Appointments Clause of Article II of the U.S. Constitution says certain officers must be appointed by the President, a court, or the head of the agency. The judge in this case was not appointed in those ways.

The government argued they’d objected to the judge too late in the process.

Justice Brett Kavanaugh foreshadowed the eventual ruling in March with this question to the government lawyer:

KAVANAUGH: If you were to lose, what’s your preferred approach? [LAUGHTER]

It was a splatter of concurring opinions. Four justices agreed in total, while various combinations of other justices agreed with parts of the opinion’s reasoning but not other parts. Yet all 9 justices agreed in the final judgment and handed victory to the claimants.

EICHER: And our final opinion, also unanimous in a case against the FTC—the Federal Trade Commission—and its power to seek money restitution. It’s a highly technical and specific decision on which part of law the commission must use to recover restitution. The case involves companies that engaged in deceptive practices. FTC cited a law that specifically authorizes injunctions, nothing else.

The court pointed out the FTC can seek money restitution on behalf of consumers under other parts of the law just not what the commission cited.

REICHARD: Well, you’ve heard the three opinions, and now you’ll hear about three oral arguments.

So hang on! We’re gonna move fast!

First, a class-action dispute. It’s about procedure in the appellate courts. Sounds esoteric, yet procedure does matter.

This dispute arose more than two decades ago. That’s when the City of San Antonio (Texas) on behalf of other municipalities sued a bunch of online travel companies. Think Priceline, Orbitz, Hotels.com, others like them.

EICHER: The city sued because these online companies paid taxes only on the wholesale rate they negotiated with the hotels. They didn’t pay taxes on the retail price consumers paid that includes service fees.

Like any government hunting for more money, the city of course seeks to tax the higher dollar amount.

The case bounced around for years until the booking companies finally won. Now the dispute winnows down to who has to pay the whopping $2 million dollar appellate court costs?

REICHARD: The default rule in this country is that each side pays its own legal costs. But appellate cases have different rules.

The question winnowed down even further to whether district courts have the discretion to reduce those appellate cost awards when asked. And also, when does an objection have to be brought up in the first place?

Some justices focused on the text of the rule in question. Justice Neil Gorsuch put it like this to the lawyer for the cities:

GORSUCH: It’s in the rule. You know it’s coming. Or you’re on notice that it’s coming. This is going to be taxable against you, absent the court of appeals saying otherwise. Now maybe you didn’t get the embossed invitation. But the rule’s there. And you had four opportunities by my count to raise it. Why should we be concerned?

But other justices thought it’s unreasonable to ask a party to object to costs before they even know they’re going to lose.

So law and order versus practicalities. Sometimes those things overlap. Either way, this one lacks discrete ideological and philosophical dividing lines, and so, as far as I can tell, this one’s a toss up.

This next case involves a couple from El Salvador who entered the United States unlawfully in the 1990s.

Years later in 2001, devastating earthquakes shook El Salvador. The United States then designated El Salvadorian nationals as qualifying for Temporary Protected Status. TPS, as it’s called, is a program that allows individuals the law defines as aliens to stay in the United States if their countries face war or natural disasters.

These people can avoid deportation for a while and legally hold a job in the meantime.

The couple applied for that program, obtained TPS status, and have maintained it ever since.

Years after that, they applied to adjust their status to lawful permanent residence, so that they could get “green cards.” Those give authorization to permanently live and work in the United States.

But the government denied their applications, because lawful permanent residence is based upon being properly admitted to the United States in the first place.

The government says TPS status doesn’t create a proper admittance.

One lawyer was making a point about TPS when Justice Brett Kavanaugh interrupted him.

HUSTON: But I think that it is the defining characteristic of Temporary Protected Status …

KAVANAUGH: Is that it’s not temporary!

HUSTON: Well …

The couple argues having TPS status should satisfy any “admission” requirement.

Of the 400,000 people with Temporary Protected Status, half have been in the United States for at least 20 years. But as the government’s brief pointed out, it’s understandable that Congress deals more leniently with people who come into the country via the traditional route the law provides.

Several justices wondered why they should intervene here at all. It’s up to Congress to fix immigration law.

As the Wall Street Journal put it, “The dereliction here is on Capitol Hill, since a better immigration policy would include a compromise that lets Mr. Sanchez (the husband) stay in America. (He got his day in court). What he needs is his day in Congress.”

Well, we started with a class action, and we’ll end with it as well.

Here, shareholders filed a class action against Goldman Sachs Group. That’s an investment and financial services company. Shareholders allege that Goldman Sachs misrepresented its ability to fend off conflicts of interest.

In short, shareholders allege securities fraud.

What happened is this: Goldman Sachs allowed a hedge fund to bundle mortgages into bonds, knowing the hedge fund had bet the planned investments would fail. And they did, spectacularly: to the tune of $1 billion dollars. In favor of the hedge fund. That those who’d invested in the mortgages had to pay.

The legal issue at hand is a language problem. The company told investors it would ensure integrity with pretty vague language.

For example: “Our clients’ interests always come first.”

Justice Samuel Alito sounded quite frustrated in this exchange with lawyer for Goldman Sachs, Kannon Shanmugam:

ALITO: You now disclaim in your brief the argument that a statement in itself can be so bland and innocuous and uninformative that there can’t be reliance. That’s what I’m asking about. Do you really want to say that?

SHANMUGAM: Well, I think what we’re saying, Justice Alito, is that the more generic a statement is, the less likely it is to have price impact...

Price impact. Economic terms.

You know, I appreciated Justice Stephen Breyer’s humility here. He shows as he has in the past a willingness to admit when he doesn’t understand something. He asks for help, as he does here, in an exchange with Shanmugam, for Goldman Sachs.

BREYER: Now if I have time, I’d like to know the difference in materiality and price impact. I put it in my mind and get it for a while and then I lose it. So what is it, in your opinion?

SHANMUGAM: I think I can answer that in a sentence because I know time is short. Materiality focuses on what a hypothetical reasonable investor would care about.

Price impact focuses on what actually happened.

BREYER: OK, got it. Thank you.

Gaining understanding before rendering judgment. Nice.

I’m going to do likewise and say, this is a very complicated case I’ll wait to explain more fully after the justices sort it out.

And that’s this week’s Legal Docket.

NICK EICHER, HOST: Vermont’s largest city just passed a new ordinance.

SOUND: LEAF BLOWER

The City Council in Burlington passed a phased-in ban this week. It mandates moving to quieter electric-powered ... hang on.

SOUND: LEAF BLOWER STOPS

The city passed a phased-in ban on noisy gas-powered leaf blowers. They operate at 90 decibels, loud enough to cause hearing damage after two hours of exposure.

Everybody in Burlington has until May of next year to trade their gas blowers for quieter electric leaf blowers or a good old fashioned rake.

MARY REICHARD, HOST: I love my electric lawn tools!

It’s The World and Everything in It.

MARY REICHRARD, HOST: Next up on The World and Everything in It: the Monday Moneybeat.

NICK EICHER, HOST: Financial analyst and adviser David Bahnsen joins us for our weekly conversation and commentary on the economy. David. Good morning.

DAVID BAHNSEN, GUEST: Well, good morning, Nick, good to be with you again.

EICHER: So President Biden's tax plan, bare-bones as it was, received a going-over in the business and financial press. How does it look to you?

BAHNSEN: Well, it was interesting, because they didn't present a comprehensive plan this week, like they had been teasing. They just released one line. So it's what we would call a trial balloon.

And it was a cut and paste. But yeah, he reiterated that the plan B of his ongoing spending-and-funding legislative agenda will include increase of the capital-gain tax on those making over a million a year, to 39.6% rate, which, when you add in the Obamacare tax of 3.8%, which applies to all capital gains above $250,000 of income, you'd be looking at 43 and a half percent tax on capital gains for high earners.

The point that I've been trying so hard to make the last few days is that the biggest impact here is not that all of a sudden it makes the stock market less valuable: $33 trillion, $33 trillion, of value is in the United States retirement accounts—IRAs, 401 Ks, pension funds, annuities, vehicles that don't have any exposure to investment tax.

The issue is not in what it does to the overall market. It's what it does to capital investment.

It takes away incentive for normal, healthy, rational functioning of capital allocation: people holding on to assets they otherwise wouldn't be holding on to, means people not buying assets they otherwise would be buying. It stunts capital investment, therefore, that trickle-down effect is indeed broader in its scope.

All economics is marginal. When you are taxing more of something you do want, in this case, capital investment, you're going to get less of it.

So the politicians can decide how much capital investment they're willing to sacrifice. But the fact of the matter is that a lot of Republicans are gonna argue against it like, “Oh, this will go crush the market.”

That is not the primary issue here. The primary issue here is that it will alter functioning, optimal rational, healthy resources of capital, the way capital is allocated.

This is the last thing, Nick, that our economy needs.

EICHER: All-right, I’d like to hit the jobs number real quick again, because we were pleased with what we saw last week, and it was kind of a continuation of the trend. And now the moving averages seem to be moving meaningfully in the right direction, continued better news on jobs.

BAHNSEN: Yes, the weekly jobless numbers this week were really good. And they are at the lowest level this week that they've been since COVID. And now, when you get to average, a kind of three-week running average or a four-week running average, the trend continues and continues to improve.

That's to be expected because we are getting more and more marginal reopening. in those areas where the unemployment is stubbornly persisted. There's no doubt in my mind, both empirically, and anecdotally, that we're about to run into a wall where it can't get a whole lot better until the unemployment benefits go away.

We certainly are right now hearing more and more, and seeing more and more in the data of employers who are looking to hire back food and beverage and service employees. And the employees aren't coming back because they're making more money on unemployment.

And so the very foreseeable consequences of this policy error are coming home to roost.

EICHER: I want to ask about a bit of a technical number and ask you to explain. The business data firm IHS Markit has a manufacturing and services index that allows you to see at a glance directionally how industry is going. And I read that IHS’s services index had a big jump this month versus last, as The Wall Street Journal reported, “the highest reading since data collection began in 2009, signaling the swiftest pace of expansion in at least 11 years.” But help us understand. Obviously, we’d rather see higher readings than lower readings, but the big jump—I’m assuming that’s just because it's coming off of a small number.

BAHNSEN: Yeah, the IHS Markit services number. So it's a little different than the manufacturing but the services number is what's been most stunted. But when you got to remember that, Nick, that these indexes measure the improvement month over month. And so there is this thing called “base effect,” where you're comparing it to a low number, and so you're getting a higher move higher. And the base effect versus a-year-ago numbers are somewhat distorted. I think on an absolute basis are not as positive as the trajectory or the month over month or year over year movement would be. So kind of, as economists, we have to kind of look at both things.

And they are outperforming so I don't want to throw any water on this. I just want to reiterate that the IHS data in manufacturing and services is as strong as it is now, you're going to have a lot of productivity sloshing through the economy, and that's going to create real GDP growth of the non-inflationary kind. So that's what we have to be hoping for.

But the data right now is not measuring that. It's measuring where we are relative to a very low point.

How do we get an indication of what to expect into the future in the post post COVID recovery? You have to look to business confidence, you have to look to small-business optimism. These things are the best. They're not perfect, but they're the most historically reliable, forward looking indicators. Right now the numbers are good. But again, we still have to get through whatever tax changes are coming. And we certainly have to get through some period of digesting all the fiscal or monetary sugar highs that are out there.

So I'm not being pessimistic, but I don't want to be overly optimistic either. There's a lot of wait-and-see stuff in economic data right now.

EICHER: Okay, let's set it down right there then. David Bahnsen, financial analyst and adviser. He writes at DividendCafe.com, and you can sign up to have it delivered to your email if you’re interested. Thanks, David. I hope you have a terrific week. Talk again soon.

BAHNSEN: Sounds good, Nick. Thanks.

NICK EICHER, HOST: Next up on The World and Everything in It: The WORLD History Book. Today, a huge medical advancement for the smallest patients, a milestone in the field of logistics, technology in the palm of your hand, and the end of a long Christian persecution. Here’s senior correspondent Katie Gaultney.

KATIE GAULTNEY, SENIOR CORRESPONDENT: The Bible tells us in 2nd Timothy that “all who desire to live a godly life in Christ Jesus will be persecuted.” And the early Church felt that promise during the era of Diocletian. But, on April 30 in the year 311 A.D., that reign of terror came to an end, and with it, Christians earned more freedoms.

Prior to Diocletian, persecution of the Christian church was, as theology professor Ryan Reeves put it, “sporadic and local.” That changed with Diocletian.

REEVES: The Diocletian persecutions are considered to be the great persecutions. They are the worst, the most extensive, and the ones that last the longest.

Unlike previous Roman rulers, Diocletian wanted to assert his dominance through mandatory worship of pagan deities. He and his three co-rulers forced Christians to sacrifice to Roman gods or face imprisonment or death. Roman soldiers razed churches, burned Scriptures, and prohibited Christians from assembling.

Diocletian resigned in 305 A.D, but other Roman rulers continued to enforce the persecution. That included the emperor of the Eastern empire, Galerius. But April 30, 311, from his deathbed, Galerius rescinded the persecution. That gave Christians the right to peaceably assemble and live freely.

Persecution had failed to quell Christian devotion. By 324, Christianity was the dominant religion of the Roman empire under Constantine.

Jumping ahead centuries now to an advancement that changed global commerce.

SOUND: CONTAINER SHIP HORN

Sixty-five years ago, on April 26, 1956, the SS Ideal-X, the world's first successful container ship, left Port Newark, New Jersey, for Houston, Texas.

SOUND: CONTAINER SHIP BEING LOADED

That voyage revolutionized the industry. Before then, items were packaged into barrels or sacks that had to be painstakingly loaded onto ships. It took hundreds of dockworkers to load and unload goods. Now, they could be shipped in sturdy boxes lifted straight onto trucks upon docking. No more unloading, packing, sorting, and reloading.

Fifty-eight trucks greeted the Ideal-X at the Port of Houston, ready to take away its steel boxes.

Eight years after its debut as a container ship, in 1964, the vessel suffered extensive damage during stormy weather. It was scrapped that same year.

MUSIC: SAIL AWAY BY STYX

Moving from a big ship to a tiny patient.

It’s been 40 years since April 26, 1981, when Dr. Michael R. Harrison performed the world's first successful human open fetal surgery.

In a video for the University of California—San Francisco, Harrison explained that even among high-risk unborn patients, 90 percent will fare well with external monitoring and maternal support. But that leaves 10 percent.

HARRISON: Nine out of 10 don’t need intervention. But the one out of 10 that need it really need it.

Harrison and his team at UCSF guided a plastic tube about as thick as a piece of spaghetti through the pregnant mother's abdominal wall and uterus and into the baby’s bladder to fix a defect in his urinary system that may have proved fatal. Harrison reflected in 2012 on the wonder of that experience.

HARRISON: The first time was magical. Because when you first open the uterus, the way to manipulate the kid is to get one extremity out, so you often pull out a hand or arm, and to see those tiny fingers is really magical.

Months after the successful outcome, Harrison told the New York Times, “'It's a first small step on the way to bigger things.'' And it was. Harrison and others pioneered new techniques that have lowered the risk and invasiveness of fetal interventions. Harrison earned the nickname, “the father of fetal surgery.”

MUSIC: LULLABY

And for our fourth and final entry today, small technology—with a big impact.

SOUND: MOUSE CLICK

The public first began hearing that click on April 27, 1981, when Xerox’s Palo Alto Research Center introduced the computer mouse. Inspiration struck inventor Douglas C. Engelbart at a computer graphics seminar in 1961.

ENGELBART: I realized that pointing at the screen was always going to be important, so it just suddenly occurred to me, why don’t I get a device that wheels in two directions, and you move it around…

A prototype soon followed. But two decades went by before Xerox-PARC marketed his idea.

MUSIC: COMPUTER LOVE BY KRAFTWERK

Of course, today, with trackpads and touch screens, the mouse may be drifting toward obsolete territory. But prior to the introduction of the mouse—named for its little button “ear” and cord “tail”—directing a conventional computer meant typing commands on a keyboard. With the mouse’s new “point and click” function, computer users could open windows and perform functions without the need for much computer language know-how.

That’s this week’s History Book. I’m Katie Gaultney.

NICK EICHER, HOST: Tomorrow: saber-rattling in Russia. We’ll find out what’s behind Vladimir Putin’s now completed military exercises on the border with Ukraine.

And, statehood for D.C.? We’ll talk to a legal analyst who says the House bill passed last week is unconstitutional.

That and more tomorrow.

I’m Nick Eicher.

MARY REICHARD, HOST: And I’m Mary Reichard.

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