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How U.S. Firms Helped Africa’s Richest Woman Exploit Her Country’s Wealth

Westlake Legal Group 19dossantos-02-facebookJumbo How U.S. Firms Helped Africa’s Richest Woman Exploit Her Country’s Wealth United States Tax Shelters Sonangol Group PricewaterhouseCoopers Poverty Politics and Government Oil (Petroleum) and Gasoline Money Laundering McKinsey&Co Malta Lourenco, Joao LISBON, Portugal Jewels and Jewelry International Consortium of Investigative Journalists High Net Worth Individuals Galp Energia embezzlement Dubai (United Arab Emirates) Dos Santos, Jose Eduardo dos Santos, Isabel Diamonds De Grisogono Corruption (Institutional) Consultants Angola Africa

LISBON — It was the party to be seen at during the Cannes Film Festival, where being seen was the whole point. A Swiss jewelry company had rented out the opulent Hotel du Cap-Eden-Roc, drawing celebrities like Leonardo DiCaprio, Naomi Campbell and Antonio Banderas. The theme: “Love on the Rocks.”

Posing for photos at the May 2017 event was Isabel dos Santos, Africa’s richest woman and the daughter of José Eduardo dos Santos, then Angola’s president. Her husband controls the jeweler, De Grisogono, through a dizzying array of shell companies in Luxembourg, Malta and the Netherlands.

But the lavish party was possible only because of the Angolan government. The country is rich in oil and diamonds but hobbled by corruption, with grinding poverty, widespread illiteracy and a high infant mortality rate. A state agency had sunk more than $120 million into the jewelry company. Today, it faces a total loss.

Ms. dos Santos, estimated to be worth over $2 billion, claims she is a self-made woman who never benefited from state funds. But a different picture has emerged under media scrutiny in recent years: She took a cut of Angola’s wealth, often through decrees signed by her father. She acquired stakes in the country’s diamond exports, its dominant mobile phone company, two of its banks and its biggest cement maker, and partnered with the state oil giant to buy into Portugal’s largest petroleum company.

Now, a trove of more than 700,000 documents obtained by the International Consortium of Investigative Journalists, and shared with The New York Times, shows how a global network of consultants, lawyers, bankers and accountants helped her amass that fortune and park it abroad. Some of the world’s leading professional service firms — including the Boston Consulting Group, McKinsey & Company and PwC — facilitated her efforts to profit from her country’s wealth while lending their legitimacy.

The empire she and her husband built stretches from Hong Kong to the United States, comprising over 400 companies and subsidiaries. It encompasses properties around the world, including a $55 million mansion in Monte Carlo, a $35 million yacht and a luxury residence in Dubai on a seahorse-shaped artificial island.

Among the businesses was the Swiss jewelry company, which records and interviews reveal was led by a team recruited from Boston Consulting. They ran it into the ground. Under their watch, millions of dollars in Angolan state funds helped finance the annual parties on the French Riviera.

When Boston Consulting and McKinsey signed on to help restructure Sonangol, Angola’s state oil business, they agreed to be paid in an unusual way — not by the government but through a Maltese company Ms. dos Santos owned. Then her father put her in charge of Sonangol, and the government payments soared, routed through another offshore company, this one owned by a friend of hers.

PricewaterhouseCoopers, now called PwC, acted as her accountant, consultant and tax adviser, working with at least 20 companies controlled by her or her husband. Yet there were obvious red flags as Angolan state money went unaccounted for, according to money-laundering experts and forensic accountants who reviewed the newly obtained documents.

When the Western advisory firms came into Angola almost two decades ago, they were viewed by the global financial community as a force for good: bringing professionalism and higher standards to a former Portuguese colony ravaged by years of civil war. But ultimately they took the money and did what their clients asked, said Ricardo Soares de Oliveira, an international politics professor at Oxford who studies Angola.

“They are there as all-purpose providers of whatever these elites are trying to do,” he said. “They have no moral status — they are what you make of them.”

Now, more than two years after her father stepped down after 38 years as Angola’s strongman president, Ms. dos Santos is in trouble.

Last month, an Angolan court froze her assets in the country as part of a corruption investigation, along with her husband’s and those of a Portuguese business associate. The Angolan attorney general claimed the couple were responsible for more than $1 billion in lost state funds, with particular focus on De Grisogono and Sonangol.

Ms. dos Santos and her husband could face years in prison if convicted, according to the office of Angola’s president, João Lourenço. At the heart of the inquiry: $38 million in payments from Sonangol to a Dubai shell company hours after Angola’s new president announced her firing. Ms. dos Santos’s half brother is also facing corruption charges for helping to transfer $500 million from Angola’s sovereign wealth fund. The asset freeze came soon after I.C.I.J. reporting partners asked the government about transactions in the documents.

In an interview with the BBC, Ms. dos Santos, 46, denied any wrongdoing and called the inquiry a “political persecution.” “My companies are funded privately, we work with commercial banks, our holdings are private holdings,” she said.

Her husband, Sindika Dokolo, 47, suggested the new government was scapegoating them. “It does not attack the agents of public companies accused of embezzlement, just a family operating in the private sector,” he told Radio France Internationale, another I.C.I.J. partner.

Global banks including Citigroup and Deutsche Bank, bound by strict rules about politically connected clients, largely declined to work with the family in recent years, the documents show.

“These guys hear about Isabel and they run like the Devil from the cross,” Eduardo Sequeira, head of corporate finance for Fidequity, a Portuguese firm that manages many of Ms. dos Santos’s companies, wrote in a 2014 email after the Spanish bank Santander turned down work with her.

Consulting companies, far less regulated than banks, readily embraced her business. American advisory firms market their expertise in bringing best practices to clients around the world. But in their quest for fees, several have worked for authoritarian or corrupt regimes in places like China or Saudi Arabia. McKinsey’s business in South Africa was decimated by its partnership with a subcontractor tied to a political scandal that took down the country’s president.

The new leaks show the pattern repeating itself in Angola, where invoices point to tens of millions of dollars going to the firms. They agreed to be paid for Angolan government work by shell companies — tied to Ms. dos Santos and her associates — that were in offshore locations long used to avoid taxes, hide illicit wealth and launder money. The arrangement allowed her to keep a large portion of the state funds, the records show.

(The documents, called the Luanda Leaks after the Angolan capital, include emails, slide presentations, invoices and contracts. They came to the I.C.I.J. through the Platform to Protect Whistleblowers in Africa, a Paris-based advocacy and legal group.)

PwC, based in London, said it was investigating its dealings with Ms. dos Santos and would stop working with her family. Boston Consulting said it took steps, when hired, “to ensure compliance with established policies and avoid corruption and other risks.” McKinsey called the allegations against Ms. dos Santos “concerning,” and said it wasn’t doing any work now with her or her companies.

De Grisogono, an upstart Swiss jewelry company, was on life support. Its business had never fully recovered from the global financial crisis, and by 2012, it was deeply in debt.

Mr. Dokolo, Ms. dos Santos’s husband, seemed to offer a way out. He teamed up with Sodiam, the Angolan state diamond marketer, in a 50-50 venture set up in Malta that took over the jeweler. The state enterprise eventually pumped more than $120 million into the business, acquiring equity and buying off debt, the records indicate. Documents show that shortly after the acquisition, Mr. Dokolo put in $4 million, an amount he had gotten from a “success fee” — drawn from the Sodiam money and shunted through a shell company in the British Virgin Islands — for closing the deal.

Mr. Dokolo, through his law firm, said he had initially invested $115 million and “has subsequently invested significantly more into the business,” but that could not be verified in the documents.

Flush with Angolan government money, the Geneva jeweler hired the Boston Consulting Group, an American management company with offices in more than 50 countries.

In 2012, according to the documents, a Lisbon-based team at the firm took a central role in helping to run De Grisogono — “shadow management” as John Leitão, a Boston Consulting employee who would become the jeweler’s chief executive, said in a November interview in Lisbon.

The consulting firm, however, said its employees worked only on three specific projects, ending its involvement in early 2013.

By that year, the consultants had started leaving the firm to join the jeweler, eventually occupying the positions of chairman, chief financial officer and chief operating officer alongside Mr. Leitão.

He said in the interview that the consultants had inherited “a total mess.” But under his watch, the company, with boutiques in London, New York and Paris, went deeper into the red, despite an initial uptick in sales, documents show.

De Grisogono had a run of bad luck, including economic pressures affecting Russian oligarchs and Saudi sheikhs who had been big customers, Mr. Leitão said. Yet many rich patrons, including Ms. dos Santos and her husband, would take jewelry and wristwatches without paying for them up front, the documents show. Marketing expenses also shot up — 42 percent during Mr. Leitão’s first year to $1.7 million, with the increase going to the Cannes party, according to an internal presentation.

Mr. Dokolo was unapologetic about spending big on parties. “You tell me what major luxury brand spends less than this on promotion to become a global brand,” he told the French radio service. In an interview with BBC, Ms. dos Santos said she was not a stakeholder in De Grisogono, though several emails and documents call that into question, indicating she had an ownership interest in the Maltese companies controlling it.

The jeweler gave the couple an ability to better market Angolan diamonds. Mr. Dokolo already controlled the rights to more than 45 percent of the country’s diamond sales through a company that bought uncut gems, generating hundreds of millions of dollars in income, according to the Angolan president’s office.

Mr. Dokolo’s lawyers said he aimed to integrate the country’s diamond industry, “from mining to polishing to retail sales.”

The Angolan people did more than pay dearly for a European jewelry company. They paid with money borrowed at a 9 percent annual interest rate from Banco BIC, an Angolan lender where Ms. dos Santos owns a 42.5 percent stake. The government will have to repay some $225 million, according to the Angolan president’s office. The loans had been guaranteed by Ms. dos Santos’s father.

For all the money it put in, Sodiam never exercised any management control of the jeweler and never recouped any of its investment. Now, Sodiam officials want out, and the business is for sale.

“It is strange,” said Eugenio Bravo da Rosa, Sodiam’s new chairman, speaking of the man he replaced, who had signed off on the investment. “I can’t believe a person would start a business and let its partner run the business with total power to make all the decisions.”

In 2016, Sonangol, Angola’s state oil company, was in crisis after a drop in market prices. One former Boston Consulting employee described a company in an “absolutely chaotic” state. The Angolan president fired the company’s board and appointed his daughter, Ms. dos Santos, as chairwoman that June. Boston Consulting was helping Sonangol come up with a “road map” to restructure.

Ms. dos Santos had a history with the company. A decade earlier, she and her husband made millions partnering with Sonangol and a Portuguese businessman to invest in a Lisbon gas company, Galp Energia. Their stake came courtesy of the Angolan government — through an $84 million loan from Sonangol, documents show. Their share in Galp is now worth about $800 million.

The former Boston Consulting employee, speaking on the condition of anonymity, said that Ms. dos Santos — the president’s eldest child — was able to get things done that other executives could not because she wasn’t susceptible to pressure.

“We’re very committed to transparency,” Ms. dos Santos told Reuters at the time. “We’re very committed to improving our profits at Sonangol and to improving our organization.”

But transparency went only so far. More than half a year before she was named chairwoman, her father signed off on a decree drafted at the couple’s law firm, records show, that led to the awarding of $9.3 million to a Maltese company to oversee Sonangol’s restructuring. The business, Wise Intelligence Solutions, was owned by the couple and run by a close associate, Mário Leite da Silva, De Grisogono’s former chairman. Boston Consulting came on board, followed by McKinsey, with the Maltese firm acting as their manager.

Boston Consulting and other advisers billed for only about half of what Wise received from the Angolan treasury, receipts and invoices show, even though the Maltese company had only limited expertise of its own. Wise “does not have the human resources and specific know-how,” its Maltese accountant said in a March 2016 email. Ms. dos Santos disputed this, with her law firm saying Wise had “technical expertise.”

After she took charge of Sonangol, the payments to the offshore companies would surge even higher.

In May 2017, Wise was replaced as project manager by a company in Dubai owned by one of her friends. It issued a flurry of invoices later that year, some with the barest of details. One of them, simply marked “Expenses May-September 2017,” carried a charge of more than 470,000 euros (over $520,000). These invoices account for the $38 million Sonangol paid to the Dubai company in the hours after Ms. dos Santos was fired on Nov. 15, 2017.

The Sonangol account was with the Portuguese arm of Banco BIC, where she was the biggest shareholder. Shunned by global banks, the couple increasingly relied on the Angolan lender, which has a big office in Lisbon steps from her apartment. In 2015, Portuguese regulators said the bank had failed to monitor money flowing from Angola to European companies linked to her and her associates, concluding that the lender lacked internal controls.

“Paying huge and dubious consulting fees to anonymous companies in secrecy jurisdictions is a standard trick that should sound all alarm bells,” said Christoph Trautvetter, a forensic accountant based in Berlin who worked as an investigator for KPMG, a global business advisory firm.

Days before the invoices were issued, the Sonangol executive who would have approved them was fired, replaced by a relative of Ms. dos Santos, the documents show. The managing director of the Dubai company, Matter Business Solutions DMCC, was her frequent associate Mr. da Silva.

Months later, Carlos Saturnino, Ms. dos Santos’s successor as Sonangol’s head, publicly accused her of mismanagement, saying her tenure was marked by conflicts of interest, tax avoidance and excessive reliance on consultants. He also said she had approved $135 million in consulting fees, with most of that going to the Dubai shell company.

“We have there some situations of money laundering, some of them of doing business with herself,” Hélder Pitta Grós, Angola’s attorney general, said in an interview with I.C.I.J. partners.

Ms. dos Santos, speaking with the BBC, said the Dubai company supervised work for Sonangol by Boston Consulting, McKinsey, PwC and several other Western firms. When asked about the invoices, she said she was unfamiliar with them but insisted the expenses were legitimate, charged at “the standard rate” under a contract approved by Sonangol’s board.

“This work was extraordinarily important,” she added, saying that Sonangol cut its costs by 40 percent.

Her lawyers said the $38 million was “for services that had already been provided and delivered by consultants in accordance with the contract.”

By late 2017, Boston Consulting was winding down its work on the project, which ended that November. McKinsey and PwC declined to comment.

The consultants’ involvement with Ms. dos Santos extended far beyond the Swiss jeweler and Sonangol. McKinsey, for example, provided advice on a Portuguese engineering firm she had just acquired and the Angolan mobile phone company where she served as chairwoman, documents show.

Two of the “big four” accounting firms, PwC and KPMG, did consulting work for Urbinveste, another thinly staffed company she owned that acted as a public works contractor in Angola. It oversaw projects — such as road and port design and urban redevelopment — worth hundreds of millions of dollars, some set to be financed with loans from Chinese banks and built by Chinese state-owned companies. KPMG also audited at least two companies she owned in the country. The firm said that in Angola, it performs “additional due diligence procedures” for all the businesses it audits.

The other two major accounting firms, Deloitte and Ernst & Young, now known as EY, did work for companies tied to her as well.

Accounting firms in the European Union, where much of Ms. dos Santos’s business empire was located, are bound by the same rules banks are, requiring them to report suspicious activity. One firm in particular, PwC, had a broad view into the inner workings of Ms. dos Santos’s empire.

Ms. dos Santos had a long history with PwC. In the early 1990s, fresh out of King’s College London, she took a job with Coopers & Lybrand, soon to merge to become PricewaterhouseCoopers.

Her top money manager, Mr. da Silva, whose assets in Angola were frozen last month, was also a PwC alum. And when Ms. dos Santos took over Sonangol, she brought in a PwC partner, Sarju Raikundalia, as its finance head. The payments to Dubai in November 2017 happened on his watch before he, too, was fired. Neither of the businessmen responded to requests for comment.

PwC not only audited the books of her far-flung shell companies, but also provided her and Mr. Dokolo’s companies with tax advice and did consulting work for Sonangol.

Like Boston Consulting, PwC was paid by Wise Intelligence for its Angola work, and it audited the financial statements of the Maltese holding companies that controlled the Swiss jeweler.

In 2014, PwC accountants in Malta had a problem. As they prepared annual financial statements for Victoria Limited, one of the Maltese companies that controlled De Grisogono, they wrote in a draft that the ultimate owners were Mr. Dokolo and the Angolan government. But Antonio Rodrigues, an executive at Fidequity, objected — the couple had been facing increasing media scrutiny after a 2013 Forbes article examined the origins of their wealth. Such information, he wrote, should not “be mentioned.”

“Noted — we will discuss internally and revert,” a PwC accountant replied. The language was removed.

PwC accountants also noticed there was no paperwork to account for millions of dollars in loans being pumped into the Maltese holding companies and De Grisogono, according to emails.

Robert Mazur, who was an anti-money-laundering investigator for the United States Customs Service, reviewed the PwC financial statements at the I.C.I.J.’s request, along with email exchanges between the accountants and Ms. dos Santos’s money managers.

“The accountants and financial service providers involved in these transactions should have seriously considered filing a suspicious transaction report,” he said.

When presented with the I.C.I.J.’s findings, PwC said it would not comment on specific projects, citing client confidentiality, but said it was ending its work with Ms. dos Santos. “In response to the very serious and concerning allegations that have been raised,” the firm said, “we immediately initiated an investigation and are working to thoroughly evaluate the facts and conclude our inquiry.”

As for Ms. dos Santos’s assets, the bulk of her fortune is now outside Angola, much of it in tax and secrecy havens where it will be hard to pry loose.

Ana Gomes, a former European Parliament member, filed a complaint in November in Portugal alleging that Ms. dos Santos laundered money through Banco BIC. Ms. Gomes said that the network of professional service firms had enabled Ms. dos Santos to move her money out of Angola and into legitimate businesses in Europe and elsewhere.

“They are part of a system of finding the safest landing for all the assets that are siphoned off,” she said.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

Claire Coutinho: The booming FinTech sector can help those on low incomes

Claire Coutinho is MP for East Surrey.

The UK’s FinTech sector is booming. Investment into UK FinTech – new technology to improve financial services – is at record highs, accounting for over a third of all investment into the sector in Europe. Last year, London had more people working in FinTech and a greater number of venture-capital investment deals than any other city in the world. Companies like Monzo, Revolut and Starling are some of the great financial success stories of the post-2008 era.

Amidst this surge in technology, a new Policy Exchange report suggests, there is an opportunity to address a long-standing undercurrent working against Britain’s lowest earners – and to develop a financial services market which works for the traditionally underserved.

This is no small problem. There are an estimated 10 million people, largely on low incomes, who are under-served by their bank. This has led to a chronic poverty premium with a higher overall cost of banking and poor-quality insurance and savings products for people on the lowest incomes.

Lack of access to affordable credit has driven people towards high-cost short-term loans. For our lowest income households, a broken washing machine can quickly spiral into an endless cycle of crushing debt.

And although successive governments have made progress in tackling the systemic drivers of problem debt, more needs to be done for people on low incomes. Low income customers are not well served, in part because they tend to be loss-making under the traditional banking model.

But unburdened by the legacy costs of older banking providers, FinTech providers can and do see low-income consumers as sought after, valuable customers. This gives them the ability and incentive to provide more accessible, more tailored and cheaper services.

Policy Exchange’s report, Fintech for all, sets out a series of ambitious solutions to help encourage the development of FinTech services and products for people on low incomes. For example, the Government could look to open up the “Help to Save” scheme to FinTech providers. This saving scheme allows certain people entitled to Working Tax Credit or receiving Universal Credit to get a bonus of 50p for every £1 they save over four years.

Allowing FinTech firms to participate could allow customers to benefit from innovative saving tools, such as “rounding up” their everyday transactions and putting the difference in a savings account. Other tools include using AI to predict future financial commitments and the optimum amount for low income customers to save each month.

Another of its ideas is for the Government to fund Universal Credit Banking Vouchers. Banks could reclaim vouchers funded by the largest providers of personal current accounts if low income customers banked with them. This could inject sorely needed competition for low income customers into the banking market, increasing the incentive for our best FinTech innovators to develop new products designed especially for them.

The good news is there is some countrywide support in the Conservative Party for fresh thinking in this area. Gareth Davies, MP for Grantham and Richard Holden, MP for North West Durham are two fellow newly elected Tory MPs who also contributed to this report. Many more of our new and older intake are passionate about effecting real change in left-behind communities. They too should consider carefully the opportunities presented by our thriving FinTech sector.

After all, an inclusive banking system would allow those on low incomes to fully share in the advances in banking services as they continue to develop. From access to affordable credit, bespoke budgeting tools, savings and insurance products, a new wave of FinTech offerings could transform the way we approach Financial Inclusion in the UK and ultimately lead to low income individuals getting the banking services they want and need.

The UK FinTech industry presents an exciting growth opportunity for our economy to push new boundaries in technology and to allow access to good quality financial services for all. We must support these changemakers if we are truly to unleash Britain’s potential at home and on the world stage.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

The Merchants of Thirst

KATHMANDU, Nepal — It had been 11 days since a ruptured valve reduced Kupondole district’s pipeline flow to a dribble, and the phones at Pradeep Tamanz’s tanker business wouldn’t stop ringing.

A Malaysian embassy residence had run perilously low on water, and the diplomats wanted to shower. They’d pay extra for a swift delivery. A coffee processing plant was on the verge of shutting down production after emptying its storage tank. It, too, would shell out whatever amount of money it would take. Across the neighborhood and other parts of the city, the calls were coming in so feverishly that Sanjay, a tanker driver, jokily wondered if he might get carjacked. “This is like liquid gold,” he said, jabbing at his precious cargo, large amounts of which seeped from every hatch. “Maybe more than gold.”

Dashing from filling stations to houses and factories and back, Mr. Tamanz tried to meet demand. His three tanker crews slept in one or two-hour spurts, often in the cramped, refrigerator-sized truck cabins, and kept the tankers on the road for up to 19 hours a day. He fobbed off business to competitors, an unusual practice in the cutthroat world of Kathmandu tanker men, and even sounded out a mechanic about converting a flatbed truck into a new tanker. With fat profits pouring in, the young businessman figured it might soon repay its cost.

But no matter how hard the crews worked or how furiously they pushed their lumbering vehicles over the potholed roads, there was no satisfying the city’s needs. The going was too slow. The water shortage too severe. By the time the pipeline was fully restored, some households had subsisted on nothing but small jerrycans for almost an entire month. “You know it’s not even peak season, but this is what happens here,” Mr. Tamanz said. “Just imagine what things would be like if we didn’t exist?” He trailed off as his phone rang once more.

ImageWestlake Legal Group merlin_166763508_21ed48a9-3e32-4a59-914a-3a441328dab5-articleLarge The Merchants of Thirst Water Pollution water Urban Areas Shortages privatization Poverty nepal KATHMANDU, Nepal Jordan Infrastructure (Public Works) India Global Warming Aquifers

Women filling the jars from the water being supplied by the government water authority every four days in Bhaktapur. Credit…Purnima Shrestha for The New York Times

In Kathmandu, as in much of South Asia and parts of the Middle East, South America and sub-Saharan Africa, these men and their tanker trucks sometimes prevent entire cities from running dry. Without them, millions of households wouldn’t have sufficient water to cook, clean or wash. Or perhaps any at all. And without them, an already deteriorating infrastructure might break down completely, as the tanker men know well. “The city depends on us,” said Maheswar Dahal, a businessman who owns six trucks in Kathmandu’s Jorpati district. “There would be disaster if we didn’t do our work.”

Yet there’s another side to them, too, one that is less pleasant and sometimes outright nasty. Tankers frequently deliver poor quality water, which can sicken. They usually charge much more than the state, devastating to the poor. Tanker water costs on average 10 times more than government-supplied pipeline water, according to a World Resources Institute study of water access in 15 cities across the developing world, a figure that rises to 52 times more in Mumbai.

Greedy, uncompromising and fearful of being knocked from their perch, some tanker operators even conspire among themselves to fortify the conditions that contributed to their emergence in the first place. Locals tell tales of frequent underhand deal making, pipeline sabotage and egregious environmental destruction. “They’re all thieves, rotten thieves, who should be hanged,” said Dharaman Lama, a landlady who rents out rooms alongside the Bagmati River in the Nepali capital. “It’s disgusting what they do to us.”

In some ways, these tankers are just another phase in a decades-long global process of water privatization. Many authorities believe the private sector is better at eking results out of overwhelmed utilities and have given up control of key resources. Tankers have piggybacked off that trend to secure contracts, or simply muscle in, across dozens of cities — even as officials elsewhere have concluded that water is best kept in public hands and reined in corporatized services.

The tanker fleet in Karachi, Pakistan, might have doubled over the past decade. The number in Lagos, Nigeria, has quadrupled during that time, two researchers there estimated to me, though, like in many other cities, its tankers operate in such administrative shadows that not even ballpark estimates exist. In Yemen, tankers have cornered much of the urban market since the Saudi-led intervention began in 2015. And throughout the Indian subcontinent, in particular, tanker businesses big and small have boomed as the region’s cities have swelled. Often arriving in puffs of acrid black smoke, these leaky, rust-coated beasts have become a ubiquitous sight from Bangladesh to Bolivia.

But the tanker industry might also be an early illustration of how parts of the private sector stand to profit from a warming and fast-urbanizing world. The urban population of South Asia alone is projected to almost triple to 1.2 billion by 2050, and as infrastructure decays and cities continue to sprawl into areas that aren’t served at all, tankers are well-placed to absorb some of the shortfall. Up to 1.9 billion city dwellers might experience seasonal water shortages by midcentury, according to the World Bank.

“Tankers meet a need in the short and medium-term,” said Victoria Beard, a professor of city and regional planning at Cornell University. “ You can function without electricity, but not without water. And where you have no alternatives, you’re going to have all sorts of players filling the gap.”

For city authorities that are already struggling to maintain the current supply as climate change strikes, let alone source additional water, tankers can seem like a safety net they feel powerless to resist. When severe drought emptied Cape Town’s reservoirs in 2017 and 2018, wealthy residents sidestepped restrictions by buying extra water from informal operators. When Chennai, one of India’s largest cities, almost ran dry amid weak rains this summer, over 5000 private tankers ferried in water from outside. As these shocks intensify and affect more cities, the tanker men look set for boom times.

Perched at the foot of the water-rich Himalayas and blessed with a fierce monsoon, Kathmandu should never have become a poster child for the perils of tanker dependence. But years of rampant state mismanagement and booming in-migration from the countryside, particularly during the Maoist insurgency, have massively overextended the its pipeline network. Interviews with dozens of businessmen, officials, and residents reveal the extent to which the tanker industry has taken full advantage.

Beginning in the late 1990s, tankers began to spread from neighborhood to neighborhood, picking up customers among both poor and rich residents. At first, they were welcomed as a solution to the city’s interminable water pipeline disruptions. That soon changed as the less affluent began to chafe at their high prices and unsavory practices. Previously run-of-the-mill tasks, like washing, began to require careful financial calculations. “Before, I didn’t think about how often I could shower or when I can clean the house,” said Laxmi Magar, a housewife and mother of six. “But now that water is so expensive I watch every drop.”

Many families have been forced to alter what they cook, how they cook and whom they host. Water-intensive dishes, such as spinach, are off the menu for many. Large open fires in aging apartment blocks are frowned upon because there is insufficient water to douse flames if they spread. In a country where hospitality is treasured, guests are sometimes unwanted, or almost feared, as extra bodies to accommodate. At roughly 1800 Nepali rupees ($15.60) for 5000 liters, tanker water is about 40 times more expensive than pipeline water.

Among the city’s poorest and most vulnerable, tanker shenanigans have fueled some of the worst urban water access in the world. Because few of Kathmandu’s slums are connected to the water grid, they’re completely dependent on outside assistance during the dry season. The tankers raise their rates accordingly. And because many of these areas have narrow, tuk-tuk-wide streets sprawled across steep hills that often turn to mush in the monsoon, the bigger trucks can’t get through, meaning residents have to buy in smaller sums from middlemen at grossly inflated prices. Even ostensibly middle-class families are suffering as a consequence.

Nira Kasaju and her husband work in government factories in Bhaktapur, a city a few miles to Kathmandu’s east, and together earn more than their neighbors. But with limited vehicular access to their crumbling 17th century apartment building, they depend on narrow-bodied, tractor-drawn tankers that sell water at double the normal rate. They’ve since had to cut back on everything from toys for their children to holiday decorations. “Whatever it costs, we pay. We have no choice,” Ms. Kasaju said, as she sprinkled her stairwell with a few drops of water to keep the dust down. “This is unacceptable, of course, but what can we do?”

The World Health Organization recommends that households spend no more than 3 to 5 percent of their income on water, but tanker-dependent Nepalis shell out up to 20 percent of their earnings, a figure that can rise to over 50 percent in parts of rural Jordan.

Many customers say they would be able to manage the expense if only the water came clean. But that’s increasingly not the case. Residents report frequent skin problems, intestinal bugs and diarrhea, which compels those who can afford it to spend more money on “jugs” of potable water, and forces those who can’t to miss school or workdays. Again, it’s the poorest and most captive customers who get the worst of the water. (It could be even worse. Tankers in the Bolivian city of Cochabamba have been known to fill from chlorinated swimming pools, according to a WRI researcher in that city.)

Tankers strike deals with corrupt officials to limit pipeline flow and thus maximize their earnings, while also campaigning against public works projects that might break their strangleholds. In Lalitpur, Kathmandu’s adjoining city, residents around the landmark Patan Durbar Square said tankers paid officials not to fix many of the free, ornate public standpipes that were knocked out by the deadly 2015 earthquake. It’s a similar in Bangalore, India, where some state valve men are reportedly conspiring with businessmen.

Competition among Kathmandu’s roughly 400 tanker-owning businessmen is so ferocious that they regularly smash one another’s vehicles and call in favors from friendly politicians to shut down their rivals. “The competition is just unhealthy,” said Dharmanda Shresthra, who owns three tankers and a water bottling factory. “Everyone is always after each other and after profit, and it affects the quality of the water.”

And, crucially, the kingpins have few inhibitions about over-exploiting water resources, jeopardizing the environment and their cities’ long-term vitality. Tankers are tapping groundwater so relentlessly that many wells yield up to 20 percent less water every year. Dozens of deep boreholes and springs have already been exhausted. Unless there is a dramatic change of course, water experts — and many of the tanker men themselves — fear there will soon be few local resources left to tap.

Standing alongside the water filling station he operates at Khahare, in the hills to the south of Kathmandu, Krishna Hari Thapa was in a reflective mood in October. For the best part of a decade, he’s watched — and profited — as the number of tankers at his spring has increased from around 30 to over 80 a day. He’s watched too as the once mighty local spring has slowed to an unimpressive trickle. “Twenty years ago, it was like a river here, and now it’s not. You can only guess what it will look like in another twenty years,” he said. But Mr. Thapa won’t stop, no matter how low the flow goes, he says. The money is too good. And besides, “where else would people get water?”

Amid mounting public anger and shriveling resources, even big-time tanker operators admit their industry is out of control. For all their distasteful ways, though, the tanker men say they’re not the biggest villains in this sordid saga. That label, they insist, is best applied to the state, without whose repeated failures they never would have had an opening. The industry has a point. “Let’s face it: the private sector came in because the public sector failed,” said Dipak Gyawali, a political economist and former water minister. “And until you clean up government’s act, nothing will change. The tankers are just a symptom.”

These failures begin with the pipelines. Kathmandu Valley’s water delivery is so poor that its recipients average as little as one hour of running water every week, during which they’re expected to fill rooftop or underground cisterns. The pressure is so weak that many households capture no more than 250 liters on each occasion. For these people and the roughly 30 percent of residents who receive nothing at all, tankers tide them over until the next pipeline flow. Officials recognize it’s a crisis, but say the solution is out of their hands.

“Frankly speaking, the demand-supply gap is huge: demand is 400 million liters a day. Supply varies from 90 to 150 million liters,” said Sanjeev Bickram Rana, the executive director of the Kathmandu Valley Water Supply Management Board. “How can we bridge that gap?”

The roads in the area also impede water delivery to residents. Most trucks source their water in places like Khahare, where the terrain begins its slow climb to the Himalayas. But the rural roads are so rough that they can’t drive fast for fear of snapping axles, and the city’s poorly designed transport network is frequently snarled with traffic. Businessmen say their trucks could perform double their current daily average of four deliveries and thus sell more cheaply if they could move quicker. But with no expectation of improved roads, tanker drivers have implemented their own precautions.

Some pad their ceilings with folded newspapers to cushion the blows as they get bounced around their suspension-less vehicles; others deck their cabins out with so much religious iconography they can scarcely see through their windshields. The most impatient, or those who work the most traffic-clogged routes, take things further. Many trucks have equipped themselves with mini TVs or booming sound systems.

The government’s proposed solution to these grave water shortages, the Melamchi project, has turned into a four-decade-long fiasco of almost unrivaled incompetence. First proposed in the 1970s and begun in 2000, this scheme to divert a mountain river from the Himalayas has been so delayed that the water it will bring — 170 million liters a day in its first phase — is already insufficient to cover half of Kathmandu’s needs. It’s not a good plan, anyway, experts say. The pipeline network is so riddled with holes that “you could have Lake Baikal on the other end and it still wouldn’t be enough, ”Mr. Gyawali said.

In an interview at her family’s tightly guarded compound, Bina Magar, the minister of water supply, blames her predecessors for the severity of the water deficit. “For so long we had unstable governments that have lasted one year, six months, eight months.” she said. “Now we have an opportunity to bring stability and fix everything.” And while the minister conceded that tankers have helped mask the state’s shortcomings — so much so that every ministerial residence relies on them — she insists they’re living on borrowed time. “They charge too much. We charge much less. Once Melamchi is complete, we will be the answer.”

But corruption and bureaucracy riddle almost every level of state, ensuring the tankers perform even worse than they otherwise might. Tanker men field so many demands for bribes that they sometimes keep wads of cash on hand for that purpose. If they don’t pay sums that vary from 5,000 ($43) to 100,000 ($866) rupees, they can get shut down, a dozen businessmen said. These costs, too, must be passed on to the consumer. Officials are noticeably tentative in their denials. “These claims are not related to our organization, but perhaps the traffic police or someone else,” said Mr. Rana of the water management board, citing what’s widely seen as the greediest branch of Nepali officialdom.

In fact, the state’s disregard for the water sector is so pronounced that the poor quality of tanker water is as much a consequence of shoddy or nonexistent regulation as opportunism. The state implemented a color-coded sticker system to gauge tanker water in 2012 — green for drinkable water, blue for household use, yellow for construction-quality — but years on it still isn’t properly enforced. Kathmandu Valley Water Supply Management Board says it lacks the resources to monitor more than three days a week; the tanker men say officials don’t care as long as their pockets are lined. No one disagrees that it’s a mess.

As chairman of the largest water tanker association, Pradeep Prasad Pathak is charged with defending business interests, a task that he said is getting trickier as the state falls back on “divide and rule” tactics by playing off tanker men against one another. “The government has never felt responsible for supplying water to the people. It’s always the case in cities like Kathmandu that people like us do their job for them,” he said. Some tanker men lack the education to differentiate between good water and bad, he acknowledged, which is precisely why the industry needs to be regulated. “We’re not heroes. We need some controls as well.”

For the time being, neither the state nor most tankers have much inclination to change their ways. Circumstances might soon force their hand, though. Demand for water is growing so swiftly that tanker operators can’t meet all orders in the dry season, no matter how much they hike their prices. “Every year, more people come to us, which is great,” said Maheswar Dahal, the Jorpati tanker man. “But in the winter, we have to tell them, ‘it might take five days,’ or sometimes we just have to say ‘no.’” In times of scarcity, it’s the best customers, generally the rich, who get priority from the pipeline and tanker operators alike.

Supply is also shrinking, in part because authorities are mishandling growth that in Kathmandu, as in most South Asian cities, is far outpacing that of the region at large. In addition to the tankers’ over-exploitation of boreholes, the city is eating into its remaining forests, which feed the springs, while also sprawling over aquifer recharge areas. For much of the rainy season and the months that follow, many households use hand pumps to extract from the shallow aquifers under their properties and provide for at least some of their needs, but the more the valley is tarmacked over the less the groundwater is replenished. Climate change, in turn, is making the rains more erratic, which limits rooftop rainwater harvesting, and fuels floods that contaminate some aquifers.

And as this gap between supply and demand widens, the public is beginning to lash out. Residents of water-impoverished districts have assaulted water officials when they venture into their areas. Water tankers have been attacked when they have gone on strike, and people are increasingly fighting each other as water becomes scarcer and more expensive. Though many Kathmandu area farmers welcome tanker men and often make more from leasing wells than growing crops, increasing numbers of their peers in India and elsewhere are butting heads with businessmen whom they accuse of drilling them dry. “We get no water from the pipelines, less water from our well, and we can’t afford tanker water. Of course we’re angry!” said Anjali Tamang, a student, as she picnicked with friends along the Bagmati.

With some households subsisting on as little as 15 liters per person a day, well below the United Nations’s minimum acceptable standard of 20 liters for refugees, community leaders warn of more severe violence unless the government solves the crisis.

There are signs of hope. With their profits threatened by depleted resources, some tanker men have begun to adopt more sustainable extraction practices. In Chandragiri, a fast-expanding outer neighborhood of Kathmandu, six tanker men have banded together to try and save the forest on which their springs — and income — depend. In several municipalities far to the south of the capital, local administrators have signaled what can happen when they, not the central government, are entrusted with control of utilities. Hetauda municipality now delivers at least six hours of running water a day, at 60 percent of the price the state charges in the capital, which has shut out most private water providers.

Away from Nepal, in other water-impoverished megacities, authorities have proved that seemingly intractable shortages can be addressed, or at least somewhat allayed, while reining in private tankers. From Delhi, which is rehabilitating up to 500 lakes and wetlands in order to boost groundwater recharge, to large parts of urban sub-Saharan Africa, where public standpipe access has expanded, a number of cities are at least trying to cut back on informal water provision. “I think optimism at this point would just make us complacent, but not everything is lost,” said Aditi Mukherji, a senior researcher at the International Water Management Institute in New Delhi. “We have solutions, even if none of them are easy.”

But until Kathmandu and its growing cohort of struggling urban peers radically alter their ways, they won’t be among that select few. Residents certainly expect little to change. If anything, they’re gearing up for more thirst, more expense and even more vulture-like practices.

On a Saturday morning in late October, Sunita Suwal waited outside her house in Bhaktapur for the weekly pipeline delivery to flow. She grew increasingly angry as the scheduled time passed. Then, she waited another hour, losing out on a shift at a seamster’s workshop that she could ill afford to miss. Finally, as the morning ticked by with no water in sight, Ms. Suwal snapped. “The state fails us. The tanker men rob us,” she said. “They all just want to make money from us. Really, what’s the difference?”

Rojita Adhikari contributed reporting from Kathmandu.

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Philippine Peasants Were Promised Land. Staking a Claim Can Be Deadly.

SAGAY CITY, Philippines — On the day the gunman murdered her husband, Elza Balayo was planning a treat for her five children, a fish to accompany the rice that was typically their sole lunch.

The couple was walking home from the market in the midday heat with their young son when a shot pierced the silence. She recognized the attacker, she would later tell the police. He managed the sugar cane plantation at the northern end of the island of Negros, where her husband’s family had lived and labored for more than 70 years.

She had no doubt why he pulled the trigger: To punish her husband for the audacity of seeking to own a patch of the soil.

“He gambled his life to own the land,” she says.

For decades, Philippine leaders have vowed to attack a glaring economic inequality framing life in this former American colony — the dominance of a handful of landowning families, and the landlessness of tens of millions of farmers who till the soil in near-feudal conditions. The current president, Rodrigo Duterte, took office more than three years ago promising to liberate rural Filipinos from poverty by distributing land to farmers.

ImageWestlake Legal Group 00philippines-poverty-2-articleLarge Philippine Peasants Were Promised Land. Staking a Claim Can Be Deadly. sagay city, philippines Poverty Politics and Government Philippines Land Use Policies Labor and Jobs Duterte, Rodrigo Agriculture and Farming

The Balayo family waiting for public transport along a highway in Sagay City.Credit…Jes Aznar for The New York Times

Although Mr. Duterte has fashioned himself a man of the people with a bloody crackdown on criminality, he has evaded one crucial populist fight. He has not challenged the monopolistic grip of the landowners. He has instead fortified their control, reinforcing the conditions that gave him an opening to take power.

Those conditions are stark. More than 38 percent of rural-dwelling Filipino children suffer stunted development, despite living on some of the most fertile land on earth. More than one-in-five people in this country of 108 million are officially poor, even as the national economy has expanded rapidly in recent years.

To be born into the ranks of the Filipino poor is to be condemned to the fatalistic knowledge of perpetual hardship, and the dangerous futility of seeking improvement. Landowners dominate local governments, while deploying private armies to keep control.

Mr. Duterte vowed to attack this state of play. With his penchant for deriding opponents and proclaiming his own fearlessness, he has drawn comparisons to President Trump. Like right-wing populists around the world, his political fortunes have been lifted by rage toward the establishment.

In Italy, Matteo Salvini’s League party has surged in popularity as an answer to globalization. In Sweden, right-wing extremists have been propelled by anger over immigration. In India, Narendra Modi’s Hindu nationalist party has demonized Muslims.

In the Philippines, Mr. Duterte has focused on criminals as the fundamental threat to daily life, exhorting vigilantes to “slaughter them all.” On his watch, the police have executed thousands of people Mr. Duterte’s government says are drug dealers — a characterization that human rights groups dispute.

But during his tenure, job growth has slowed while prices for commodities like rice have soared. The wealthiest regions of the country have pulled further away from the poorest.

More than a year after she was consigned to widowhood, Ms. Balayo has lost hope that she will ever see justice for her husband’s murder. Her report to the police has yielded no meaningful investigation, she says. No one has been arrested.

She registers disgust at the mention of Mr. Duterte’s name. “He just talks and talks,” she says. “It’s been so long, and we still don’t have our own land.”

The president initially entrusted the cabinet-level job of overseeing land redistribution to Rafael V. Mariano, a former member of Congress and farmer’s rights activist. But Mr. Mariano was soon dismissed. In an interview, he accuses the president of caving to pressure from landowners.

“He showed his true class position,” Mr. Mariano says. “He is not really serious and sincere in addressing the fundamental problem of the Filipino peasant, which is landlessness.”

Mr. Duterte remains extraordinarily popular, with approval ratings near 80 percent. Yet among poor farmers, he is increasingly viewed as a threat, especially as he intensifies a decades-old battle against a stubborn Communist insurgency, the New People’s Army. The guerrillas have long drawn recruits from landless peasants, who have embraced armed struggle as the means of acquiring land.

In October, the Philippine National Police and military arrested 57 people in a raid on the island of Negros, later charging some with illegal possession of firearms. Among those detained were three teenagers from Hacienda Silverio, a sugar plantation. They had been rehearsing a play about a Filipino revolutionary who fought the colonial Spanish, the Americans, and the landlords.

Weeks later, a truckload of government soldiers arrived at the plantation, or hacienda, in fatigues, bearing assault rifles. They warned the farmers that participating in the play was tantamount to pledging allegiance to the guerrillas.

“When people continue to agitate for what Duterte promised them, he turns against them,” says Dioscoro Andrino, a local farmer. “They look at us like we are the enemy.”

When Mr. Duterte first took office, he expressed sympathies with the Communists, while promising to forge peace with the New People’s Army.

He affirmed one of the insurgency’s key aims — putting land in the hands of poor farmers.

To underscore his designs, he installed Mr. Mariano as Secretary of Agrarian Reform.

The son of landless farmers, Mr. Mariano had spent three decades campaigning for land distribution. As secretary, he instituted an order allowing transfers to proceed even as landowners pursued legal challenges.

In doing so, the new administration was confronting a potent historical legacy. For centuries, formidable interests had battled over the fruitful soils of the Philippine archipelago.

Commodities like sugar and coconuts were central to the colonial designs of the Spanish and the Americans.

As the Philippines claimed independence in 1946, Washington required that the fledgling country keep its currency strong against the dollar, ensuring continued imports of American-made manufactured goods.

“The big Filipino families, the oligarchies, are not able to transition away from agriculture because they can’t transition to manufacturing,” says Lisandro E. Claudio, a Southeast Asian historian at the University of California, Berkeley. “This is why they became so grubby about their landholdings.”

The American-backed dictator Ferdinand Marcos pursued land reform as part of a strategy to attack the Communist insurgency. But Washington urged him to respect property rights.

Notoriously corrupt, Mr. Marcos was swept into exile by the 1986 People Power demonstrations. His successor, Corazon Aquino, oversaw the drafting of a new constitution that explicitly called for agrarian reform.

Ninety percent of the land was then controlled by 10 percent of the population. Under a law signed by Ms. Aquino in 1988, an area roughly the size of Portugal was to be distributed to farmers over the following decade.

On paper, the government achieved substantial progress. On the ground, landowners gamed the process, officially selling holdings while maintaining control.

At one of the largest plantations on Negros, Hacienda Balatong, which stretched over 1,400 hectares (nearly 3,500 acres), the landowner fended off a government-imposed transfer through legal creativity.

The land had been owned for decades by a Marcos crony, Eduardo “Danding” Cojuangco Jr. Some 2,000 families lived there. Farmers earned as little as 100 pesos per day (less than $2).

In the late 1990s, the Cojuangcos persuaded farmers to agree to a so-called voluntary land distribution to pre-empt government action. The farmers received title, while immediately leasing the land back to the Cojuangcos in exchange for cash payments of 10,000 pesos a year.

For most farmers, this was too much to pass up.

“If we don’t work, we don’t eat,” says Maria Luisa Malvez, 51, whose husband’s family had lived on the plantation for at least four generations. “The Cojuangcos just wait for the harvest to earn.”

Her in-laws lived in a concrete block home where they had raised eight children, though five had died of various ailments not helped by abject poverty. Their corrugated aluminum roof was rusting through, even as their concrete floor was spotless.

The cash payments lifted their income by half. Twice a year, her father-in-law, Paulino Malvez, hopped on trucks the Cojuangcos dispatched to the hacienda to bring farmers to the payment center — a cockfighting arena next to a mansion shrouded in forest cover.

Mr. Malvez had left school after the fourth grade. He could not understand the agreement he was required to sign. But when a human rights lawyer, Ben Ramos, read the terms in 1999, he urged the family to stop accepting the money. The arrangement was a sham, he told them. It undermined future claims on the land.

“The Philippines is still really a semi-feudal democracy,” says Leonardo Montemayor, a former secretary of agriculture. “We have a democratic veneer. We have judges, trials, and due process. But the longer the due process takes, the longer it takes for a farmer to secure substantial justice.”

The arrival of Mr. Mariano at the Department of Agrarian Reform appeared to mark a new era. He put landowners on notice — especially on Negros, calling the island “the bastion of landlordism” where “farmworkers are still enslaved by hunger and poverty, and are being threatened, shot at and massacred by goons and soldiers.”

To advise him, he enlisted Mr. Ramos, the local human rights lawyer who represented the farmers at Hacienda Balatong.

Mr. Ramos advanced a petition seeking to annul the leasing arrangement and parcel out the estate to the farmers. The petition argued that the Cojuangcos had obtained the land illegally, through their association with Mr. Marcos.

Mr. Mariano says his department was moving to approve the petition. An executive committee convened by Mr. Duterte had already accepted his recommendation to break up the estate.

But in September 2017, less than 15 months after Mr. Duterte appointed him, Mr. Mariano was out. A congressional panel stacked with Duterte loyalists voted to deny his confirmation.

Over the course of a two-day hearing in Manila, Mr. Mariano found himself under sustained attack from the landowners he had been targeting — especially allies of Mr. Duterte in Davao, a city on the island of Mindanao, where the president had previously been mayor.

He was questioned about his transfer of land to farmers at a plantation owned by Lapanday Foods Corp., a banana exporter. A company lawyer was married to the president’s daughter, Sara Duterte, the current Davao mayor.

She and other local officials as well as the secretary of national defense submitted a written statement claiming that Mr. Mariano had aided the New People’s Army in area attacks, he says.

“There was a strong lobby of the big landlords, compradors, oligarchs and bureaucrats,” Mr. Mariano says. A spokesman for Mr. Duterte did not respond to questions.

James Castriciones, who had worked on the president’s campaign, took over as secretary. He promptly overturned Mr. Mariano’s order allowing land transfers to proceed in the face of court challenges. Mr. Castriciones did not respond to questions about his appointment or the overall thrust of the land reform undertaking.

The following year, Mr. Ramos, the lawyer, was standing on the side of the road when two men on motorcycles swept in and opened fire, killing him. He was the 34th lawyer killed since Mr. Duterte became president. In a speech in 2017, the president exhorted the police to persevere in the face of human rights lawyers probing the killings of alleged criminals. “If they are obstructing justice, you shoot them,” Mr. Duterte said.

Farmers at Hacienda Balatong complain that their petition has essentially disappeared.

“Duterte made these promises,” says Maria Luisa Malvez. “Nothing has happened.”

On the day the Malvez family recounts this, farmworkers at the hacienda stumble on a grisly sight as they hack away at the sugar cane: Two men lying in the dirt, dead. Two days earlier, another body had been fished out of a muddy river, bloated and bloodied.

As a half-dozen farmers gather in front of the Malvez home, everyone assumes they know what happened.

The men were migrant workers from southern Negros. They must have grown weary of meager pay and filthy living conditions. They must have bolted for home, leaving the contractor to answer to an angry farm manager about their disappearance before the harvest was done.

They must have been running for their lives.

On the local radio, an announcer briefly mentions that three bodies have been found at the hacienda and adds the conclusion of a police report: The men died of “natural causes.”

Plantation owners tend to dismiss land distribution as a failure. Farmers lack the money to tend their parcels, so they often sell land back to previous owners, resuming their jobs as farmworkers.

“They are happy enough to work for us,” says Gerro Locsin, who owns a sugar plantation in Negros. “There’s no problem.”

Eduardo Balayo had a problem.

His family was miserably poor. The only solution he could imagine was to own a piece of Hacienda Ubamos.

“He saw it as a way out of poverty,” says his widow. “The dream was that the kids could get an education and not follow what we are.”

Mr. Balayo earned about 800 pesos a week (less than $16). The family ate meat only at Christmas. They fashioned their house from bamboo, palm fronds and plastic rice sacks. They had no electricity. The toilet was the surrounding fields. Keeping their children in school was a constant struggle.

“Sometimes they have to walk barefoot because we can’t afford shoes,” Ms. Balayo says, her voice halting as she swallows a sob. “They have assignments demanding things I can’t buy — colored paper, crayons, scissors.”

Mr. Balayo organized a local farmer’s association to pursue land distribution, submitting the paperwork to the agrarian reform department in 2013. He and his older brother, Welter, and seven other households had been cleared as qualified beneficiaries of the 12.3-hectare estate (about 30 acres).

Each was to receive 1.3 hectares, enough to yield more than 60 tons of sugar cane a year, Ms. Balayo says. After expenses, they could fetch at least 120,000 pesos (about $2,350). Their income would double, allowing them to keep their children in school.

But in seeking the land, Mr. Balayo was taking on local authority. The hacienda was controlled by Narciso L. Javelosa, the vice mayor of Sagay City, through a lease with the landowning family, according to the Department of Agrarian Reform. Mr. Javelosa did not respond to messages left at city hall.

The vice mayor regularly visited the property, driving through in a pickup truck, residents say. Men walked the rutted trails, their faces obscured by black balaclavas, and pistols tucked into their waist bands.

“I was very worried,” Ms. Balayo recalls. “But my husband said, ‘I will not stop until we get this land.’”

Three times, the agrarian reform department dispatched surveyors to the hacienda, accompanying them with police officers. Three times, armed men turned them away.

“There are so many properties” the agency cannot enter, says Teresita R. Mabunay, who oversees the north of Negros for the agrarian reform department.

One day last year, as Mr. Balayo was walking on a muddy track through the plantation, the farm manager, Raymundo Jimenez, blocked his path in a menacing fashion, Ms. Balayo says.

Months later on Sept. 15, 2018, as they returned from the market with a fish, Mr. Jimenez opened fire, she says, an account she relayed to the Sagay City police, as confirmed by an official police report. The gunman pointed the pistol at his face and unleashed eight more bullets, she says.

When the police arrived, Ms. Balayo identified the gunman as Mr. Jimenez and told them where he lived, but he was not home, she says. She assumes the police are not trying to find him. “He works for the vice mayor,” she says.

As she recounts the experience, men appear on a hillside, peering down. “Those are the goons,” a villager says.

Mr. Balayo’s older brother, Welter, took up the mantle of seeking the land. On April 20, 2019, as he was working in a rice field just outside the hacienda, he, too, was shot dead.

In August, the regional office of the Department of Agrarian Reform ruled that the seven remaining farmers were no longer qualified to take over the land. The order affirmed a motion from the landowners that accused the farmers of “forcible entry.”

The order cited an investigation conducted by the department’s Sagay City office, then run by Hannah D. Jubay. In an interview, Ms. Jubay, who was recently transferred to a nearby district, says she was powerless to question a police report concluding that farmers had entered a field they did not own.

A gold etching of Jesus hangs on her wall, looking down on her desk, next to a sign that says: “Vision: A Just Safe and Equitable Society that Upholds the Rights of Tillers.”

Hadn’t this case collided with that spirit?

Ms. Jubay looks pained.

“The landowners are very resistant,” she says.

Jason Gutierrez contributed reporting.

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The Tax Break for Children, Except the Ones Who Need It Most

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MONROE, La. — With two children and a third on the way, Ciera Dismuke worked five jobs last year while earning just under $15,000. Although the Trump administration often boasts that it doubled the federal child tax credit to $2,000 per child, Ms. Dismuke, like millions of Americans, earned too little to fully qualify. Instead, she got $934 a child, an increase of just $75.

Letha Bradford, a teacher’s aide, qualified for an equally small increase, despite a household budget so tight that she listens to her son’s high school football games outside the stadium to save the admissions fee. Michael Spielberg, a Sam’s Club attendant, also received only a partial credit, while his son, Josh, who has Asperger’s syndrome, doubled up on classes, hoping to graduate early and turn his job bagging groceries into full-time work.

“Food has been a bit of a struggle,” said Josh, 16.

The 2017 tax bill, President Trump’s main domestic achievement, doubled the maximum credit in the two-decade-old program and extended it to families earning as much as $400,000 a year (up from $110,000). The credit now costs the federal government $127 billion a year — far more than better-known programs like the earned-income tax credit ($65 billion) and food stamps ($60 billion).

But children with the greatest economic needs are least likely to benefit.

While Republicans say the increase shows concern for ordinary families, 35 percent of children fail to receive the full $2,000 because their parents earn too little, researchers at Columbia University found. A quarter get a partial sum and 10 percent get nothing. Among those excluded from the full credit are half of Latinos, 53 percent of blacks and 70 percent of children with single mothers.

“The child tax credit is the largest federal expenditure for children, but it excludes from the full benefit the kids who need it the most,” said Sophie Collyer, a member of the research team at Columbia, who analyzed the program with her colleagues Christopher Wimer and David Harris. “This is a significant flaw in its design that’s at odds with the administration’s claims about the achievements of the tax bill.”

Because the credit rises with earnings, a single parent with two children has to earn more than $30,000 a year to collect the full amount.

Republicans say that the credit is mostly a tax cut, not an anti-poverty program — so rightly favors taxpayers — and that the needy have other sources of aid. But a majority of congressional Democrats have backed a bill to increase the credit and include both the working and nonworking poor, essentially creating a guaranteed income for families with children.

Many rich countries have similar child allowances and less child poverty. But opponents call the idea welfare and warn it will discourage work and responsibility.

Rarely has a program grown so rapidly with such little public notice. While it began in 1997 almost entirely as a tax cut, it is already an anti-poverty program: About 30 percent of its value now goes to “refundable” credits — partial cash awards — for families with no income-tax liability.

Championed by Newt Gingrich and expanded by Barack Obama, the credit has a history of bipartisan support. But the attempt by Democrats to remove the earnings test is a shift for a party that since the Clinton administration has been wary of the welfare label and reflects concerns over stagnant wages, as well as new research showing that even modest amounts of extra cash can have lifelong benefits for children.

By enriching the credit and including the affluent, the Trump expansion itself has brought attention to the poor children it excludes. While the 2017 law made millions of upper-income families eligible for the $2,000 credit (in part to offset the loss of other tax benefits), it gave a boost of just $75 to most full-time workers at the minimum wage.

“It left out 26 million kids” from the full sum, said Senator Michael Bennet, a Colorado Democrat who has helped write a bill to raise the credit to $3,000 per child ($3,600 for those under 6) and pay a portion monthly. “It’s critical that we don’t leave it as a half measure. Our entire conception of ourselves as a land of opportunity is diminished by the fact that our child poverty rates are as high as they are.”

The limits of the credit’s reach can be seen in Monroe, a sleepy commercial crossroads 100 miles or more from surrounding cities, where pay is low and workers looking to advance often travel for oil-field jobs or check the want ads in Texas.

Monroe is in Louisiana’s Fifth Congressional District, one of 37 districts in 22 states where half the children or more have parents too poor to get the full credit, according to Ms. Collyer of Columbia. In the New York 15th (the Bronx), the share is 68 percent. In the Texas 34th (Brownsville to the outskirts of San Antonio), it is 61 percent.

In the Louisiana Fifth, 54 percent of children are too poor to receive the full $2,000. Among those with a partial benefit, the average is $1,008.

Many low-income families do not realize they receive the complicated benefit, which is often confused with the earned-income tax credit. Until she showed a reporter her tax return, Ms. Dismuke did not know she had gotten $934 per child. Told that affluent families get much more, she said, “That is not right — I’m quite sure they don’t need it.”

But Christina McKeigan, a divorced mother of three eligible for about half the maximum credit, said it made sense for richer families to get more. “They probably pay more in taxes,” she said. She earned $23,000 last year and stretched her budget with apps for discount grocery stores and recipes for cheesy chicken spaghetti. “I can do a lot with the amount I get.”

Scholars have long debated whether giving needy families cash raises their children’s prospects, especially if there are other problems like depression or domestic violence. But many cite growing evidence that money alone does in fact help.

The National Academy of Sciences, a group created to convey the scholarly consensus, recently concluded that raising incomes of poor families has “been shown to improve child well-being.” Reviewing dozens of studies, it found child benefits as varied as better test scores and graduation rates, less drug use, and higher earnings and employment as adults.

While findings vary, “the weight of the evidence shows additional resources help the kids,” said Greg Duncan, an economist at the University of California-Irvine who led the study.

Giving the full $2,000 credit to poor families would cut child poverty rates by 26 percent, the academy found.

At least 17 wealthy countries provide a child allowance, including Australia, Ireland and Britain. After a 2016 Canadian expansion offered up to $6,400 per child, the country’s child poverty rate fell by a third.

Money helps children in part because of what it can buy — more goods (cheesy chicken spaghetti) and services (gymnastics classes or tutors). Ms. Bradford, the teacher’s aide, is so eager to invest in her sons that she has used tax refunds to send them on Boy Scout trips to 42 states — even when a flood left them living in her car. “I’m trying to instill in them that it’s education that gives you knowledge and power, not cars or clothes,” she said.

Before traveling to Washington and visiting the Vietnam Memorial, the boys — Tony, 17, and Micah, 13 — wrote a report on a Monroe man killed in the war, which the public library added to its collection. Finding the soldier’s name on the wall, Micah said, “felt like touching history.”

Money also helps children by relieving stress, which can reach toxic levels in poor families. Earning just $16,000 despite 15 years in the public schools, Ms. Bradford is an accomplished penny-pincher. Still, food often runs short, and the power company recently shut off the lights, leaving Ms. Bradford so upset that the boys could not focus in school.

“Sometimes the look in her eye, it’s like she’s sick — but she’s not sick, she’s just stressed,” Tony said. “It makes me feel the exact same way.”

Micah said his teacher scolded him for acting distracted, but “all I could think about is how is my Mama going to pay this bill?”

Most needy families get other benefits, often at considerable taxpayer expense. Between food stamps, the earned-income tax credit and the child tax credit, Ms. Bradford receives about $10,000, plus Medicaid for herself and her sons. Mr. Spielberg gets Medicaid, subsidized housing and food stamps.

As recently as last week, Ivanka Trump, the president’s daughter, tweeted that the expanded credit shows that “we are fighting each and every day for hard-working American families.”

But the 2017 law mostly cut corporate taxes, and the Senate rejected an attempt by two Republicans, Marco Rubio of Florida and Mike Lee of Utah, to slightly reduce the corporate cuts to finance a larger credit for the poor. It would have given Ms. Bradford a gain of $450, rather than $75.

Of the $73 billion of increased spending on the credit, 39 percent went to families in the top quintile and 2 percent to those at the bottom, according to Elaine Maag of the bipartisan Tax Policy Center.

Robert Rector of the conservative Heritage Foundation warns that a universal child allowance would promote dependency and discourage work. “It’s classic, traditional welfare,” he said. “If there was anything we learned from the welfare debate in the 1990s, it was that having a single mom at home with a child and no job is not a good idea.”

But some on the right argue that an allowance promotes work and family. “The problem with the old welfare system wasn’t that it gave money to single mothers, but that it clawed it back, dollar for dollar, when they went to work,” said Samuel Hammond of the libertarian Niskanen Center. “There’s no reason to think that a flat allowance would have the same effect.”

From liberals like Speaker Nancy Pelosi of California to conservatives like Senator Joe Manchin III of West Virginia, a majority of Democrats in both houses favor a broad allowance, as do at least seven of the party’s presidential candidates, suggesting the push is likely to continue. Democrats have been pushing for an expansion of the credit as part of a year-end tax deal.

To understand how poverty limits children, consider Josh Spielberg, whose Asperger’s syndrome would present challenges even if his family had money. “Social interaction is a little different for me — like I don’t understand jokes,” he said, sitting through an interview while solving Rubik’s Cubes. After he made his first friend last year — a “very good kid, sweet kid” — the friend killed himself.

While affluent students who share his goal of attending a good college often spend junior year prepping for tests, Josh took an after-school job at $7.50 an hour and is accelerating classes to graduate early and work full time. The extra load has been “a bit of a struggle,” he said, and may hurt his grades, but “I was tired of seeing my family not being able to get the things they needed and deserved.”

Asked what money could buy, his father said he wished Josh had an ACT tutor — though even without studying he beat the statewide average. For Josh, who is 6-foot-3 with a teenager’s appetite, the appeal of his paycheck is more basic.

“To be honest, it’s eating,” he said. “I treat myself to more expensive food. Like at Taco Bell, I’ll upgrade to the chicken instead of the beef.”

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They Sought a Brighter Future in Britain. Instead, Their Families Are Mourning Them.

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YEN THANH, Vietnam — Across the village, the altar tables have already been set up.

In Buddhist and Catholic households alike, families have not waited for the final word on whether their daughters, sons, brothers and sisters are among the 39 people found dead last week in a refrigerated truck container in an industrial park in Britain, roughly 6,000 miles away.

Though the authorities in Britain have not yet identified the bodies, the families in Vietnam are treating the silence from their loved ones as confirmation enough.

The tables bore framed photographs of the missing, flanked by incense and their favorite foods. For the 19-year-old who left to support her family after her father died of cancer, it was Choco-Pies. For the 26-year-old farmer whose family was mired in debt, it was cans of Red Bull.

Behind each photograph was a tale of desperation from a place of grinding poverty, where naked light bulbs hang from corrugated metal roofs and the roads are unpaved. They are the faces of what locals and experts say has become an exodus from parts of Vietnam, a country that on paper represents one of Asia’s economic success stories.

Some in Vietnam now talk about “box people,” in an echo of the “boat people” who fled the country after the Vietnam War. The name refers to the cargo containers in which many hitch dangerous rides along some of the globe’s busiest trade routes seeking jobs and a future.

“We have a saying,” said Anthony Dang Huu Nam, a local priest. “‘If an electrical pole had legs, it would go too.’”

Investigators are still piecing together who the 39 people are, how they died and why they ended up in Grays, Britain, about 25 miles east of London. But many of the leads point back to a region of north-central Vietnam stricken by poverty and environmental disaster, and the two governments are working together to try to identify the victims.

The authorities in Vietnam have received requests for help from 14 families who say their relatives went missing in Britain, according to a Vietnamese state-run news outlet. The country’s prime minister, Nguyen Xuan Phuc, has also instructed officials to look into cases of Vietnamese citizens sent abroad illegally.

Nguyen Dinh Luong, a 20-year-old farmer, left the Vietnamese province of Ha Tinh two years ago to help support his seven siblings. His father said he borrowed $18,000 from his relatives to send Mr. Nguyen to France.

First he had to go to Russia, where he was confined in a house for about six months because he had overstayed his tourist visa. From Russia, Mr. Nguyen moved on to Ukraine before he reached France in July of last year and found a job as a waiter. Then he decided to go to England to work in a nail salon.

“Maybe he was too ambitious,” said the man’s father, Nguyen Dinh Gia, who gave his DNA samples to the police over the weekend to help with the identification process. “I don’t know much. The debt wasn’t fully paid, and in England, you could probably make more money.”

Vietnam’s narrative was supposed to be different. Boosted by growing trade, it enjoys one of the world’s fastest growth rates, reaching 7.1 percent last year. Poverty, defined as a person making less than $3.34 per day, has dropped sharply.

Still, people there make only a fraction of what the average person takes home in the United States or even China. Many in the poorest areas lack access to a decent education. While Vietnam is increasing spending on health and social benefits, many still do not share in the prosperity.

Vietnam is a major source of human trafficking victims into Britain, the second-highest after Albania, according to Britain’s ambassador to Vietnam and anti-human trafficking organizations.

Nghe An and Ha Tinh, two of Vietnam’s poorest provinces, supply much of the trade. Officials in Ha Tinh estimate more than 41,000 people left the province in the first eight months of this year alone.

Many there are farmers. Rice is the region’s predominant crop, and farmers like Mr. Nguyen earn virtually nothing.

North of Ha Tinh, the province of Yen Thanh has also become a major source of migrants. In 2016, a steel mill owned by Taiwan’s Formosa Plastics contaminated coastal waters, devastating the fishing and tourism industries.

Many put themselves in debt to pay “the line” — their term for the shadowy network of human smugglers who take people from country to country before they reach Britain or another destination. Some mortgage their homes or borrow from their families. Even to people there, the human smuggling operation remains shadowy beyond the knowledge that a person would come and collect the money for every successful leg of the journey.

Bui Thi Nhung, 19, wanted to help support her family after her father died of throat cancer in 2017, so she set off on her journey with the help of a loan from her relatives. Of those widely believed to have died in the truck in Britain, she was the youngest.

Nguyen Dinh Tu, a 26-year-old farmer, had borrowed $17,000 to build a house for his wife and two children, ages 5 and 18 months. To repay that debt, he sought help from a labor recruiter to leave for Romania legally in March, according to his elder brother, Nguyen Van Tinh.

Turned off by the low wages at a food company in Romania, he went to Berlin for a job in a restaurant. But he still felt he was not earning enough, so he decided to go to England.

“If you want your life in the village to change,” Mr. Nguyen’s brother said, “the only way is to go overseas.” He said that the family last heard from his brother a day or two before the truck was found.

While many places across Europe seem to promise higher wages and brighter prospects than home, Britain stands out. A sizable population of Vietnamese immigrants there send word home of jobs in nail salons and cannabis farms.

Pham Thi Tra My was convinced she could find a job as a manicurist. The 26-year-old woman from a village in Ha Tinh wanted to help her family, who had accumulated $19,000 in debt. Four years ago, she had borrowed money to pay a labor recruiter to find her a job in Japan as a cook, where she earned enough to pay off that loan. She then borrowed more to buy a car in Vietnam so her younger brother could drive a taxi.

Just a month ago, the car crashed and caught fire. They had no insurance. Rather than return to Japan, Ms. Pham decided she could earn more in Britain.

“I’m thinking about the family and I love you both, so I have to go,” she said, according to her father, Pham Van Thin, who works as a security guard. “Please, Dad and Mom, borrow the money for me so I can travel. Give me the opportunity to pay the debt for my family.”

The family took a mortgage on their home to send her to England. First Ms. Pham flew to Beijing, where she waited for a fake passport. She called home frequently until she went to France, where she stopped reaching out for fear that the authorities could detect her location.

Early on Oct. 23, hours before the bodies in Britain were discovered, she texted her mother. “I’m sorry, Mom, my path abroad didn’t succeed,” she wrote.

“Mom, I love you and Dad so much! I’m dying because I can’t breathe.”

The text arrived in the morning but her mother, Nguyen Thi Phong, did not check her phone until noon, eight hours later. When she called back, there was no answer.

Ms. Nguyen sent her a text: “Child, where are you now? I’m very worried and tired. I love you and feel sorry for you.”

A day later, Ms. Pham’s elder brother, Pham Ngoc Guan, texted her. “Come back and don’t go anymore,” he wrote. “The whole family is worried for you.”

On Sunday, Ms. Pham’s mother wept as she lay on her only daughter’s bed in the family’s home.

Her brother, Pham Ngoc Guan, said: “I’m still hoping she’s in another vehicle, or she’s just lost.”

He picked up his mother’s phone and called his sister again. Nobody answered.

Dan Doan and Chau Doan contributed research.

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Be sure to sign up for next week’s “poverty simulation”

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If you happen to be one of the well-heeled liberals living in the posh environs of Cupertino, California, mark November 2nd on your calendars. The economic disparity in your region is such that those with homes and good jobs in the tech sector are out of touch with their more financially challenged brethren. (Yes, we’re looking at you.) With that in mind, you need some sort of exercise to help you better relate to those living on the other side of the tracks or, more likely, in a cardboard box. Not to worry… the city has you covered. Come on down to the Cupertino Senior Center on the second of the month and take part in a “poverty simulator.” (Free Beacon)

Residents of Cupertino, Calif., and the surrounding enclaves populated by wealthy liberals will soon have the opportunity to attend a government-sponsored “poverty simulation” designed to educate participants on “the reality of a Silicon Valley that grows in disparity as much as prosperity.”

The event will take place on Nov. 2 from 10 a.m. to noon at the Cupertino Senior Center. During the two-hour simulation, participants will “work to overcome barriers to social services, live off insufficient income, and encounter unforeseen economic obstacles along the way,” according to the City of Cupertino website.

The poverty simulation will be hosted by the city and two local nonprofits, West Valley Community Services and Step Up Silicon Valley. The latter group describes itself as a “social innovation network focused on reducing poverty.”

So for two hours on a Saturday morning you will be able to learn how to access social services. I suppose that could come in handy if you lose your job. You’ll also be “living off of insufficient income.” Even if they take all of your money away at the door, how much were you going to spend between ten and noon on Saturday morning? Particularly when you’re inside of a retirement center.

If you’re so well off that you can’t “relate” to the less fortunate, perhaps there’s a better way to make an impact. You could go down to the local soup kitchen with a big bag of bread, cold cuts, cheese, and condiments and start making sandwiches to feed the hungry. You might consider calling the local battered women’s shelter and see if they need any help or donations. Heck, you could just walk down to the areas where the homeless congregate on the streets and start handing out food. I’ve seen people do it.

Nobody is going to learn about the experience of being poor in two hours when they’re just going to walk back outside, hop into their Tesla and drive back to their gated community. Real poverty is figuring out where your next meal is coming from and then not being able to enjoy it because you still have no idea where the next meal will come from. It’s being out on the street and knowing that you won’t have a locked door between you and any potential attackers when you lay your head down to rest that night.

Of course, as Andrew Stiles at the Free Beacon points out, if all you’re really interested in doing is trying to publicly express your opposition to poverty and make sure all of your friends see you doing it, carry on. Sounds like you’ve got this one nailed down pat.

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Watch: Dan Crenshaw Wrecks the Left’s “Income Inequality” Narrative

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Rep. Dan Crenshaw, R-Texas, left, listens as Office of Management and Budget Acting Director Russell Vought testifies before the House Budget Committee on Capitol Hill in Washington, Tuesday, March 12, 2019, during a hearing on the fiscal year 2020 budget. (AP Photo/Susan Walsh)

During a House Committee on the Budget hearing titled “Solutions to Rising Economic Inequality,” Rep. Dan Crenshaw totaled the idea that income inequality is not only a worsening problem in our society, he destroyed the idea that it’s a problem at all.

Speaking to Romesh Ponnuru of the American Enterprise Institute, Crenshaw started off by pointing out the two different ways we tend to look at financial prosperity, opportunities, and the economy which are usually defined by the left and the right’s views on wealth:

So, on the one hand, you have a deep and persistent focus on inequality – it’s defined as the gap between the rich and the poor – and at first glance, that seems pretty reasonable. But in reality, it means you’re dividing your attention. Half your attention is focused on protesting the wealthy – and these days that seems actually where most of the attention is – and that leaves only a small amount of focus on the real issue, which is people in poverty and their ability to move up the economic ladder. This is the kind of backwards thinking that leads to ideas like Andrew Yang’s, where we raise taxes on the rich only to give it right back to them in the form of universal basic income. It’s hard to imagine a more inefficient and ineffective way to reduce poverty.

As a conservative, our approach is different. Instead of creating resentment against success, we focus on who actually needs our help, which is the people who are having trouble moving up the economic ladder. After all, the fact that there’s a much wealthier person down the street from you is not the problem.

Crenshaw then asked Ponnuru whether or not income inequality is worse than ever, especially given all the welfare benefits and inflation. Ponnuru let everyone in the room know that we’ve actually never looked better economically:

No, it does not appear to be true. The Congressional Budget Office’s reports on the distribution of income suggest that income inequality peaked in 2007, that it has been falling since then, and so, we are, I think to some extent, looking at a problem in the rearview mirror. Of course that could change. Maybe next year’s numbers will be different, but the trends over the last decade or so have been toward shrinking inequality.

Crenshaw later dropped some statistics that back up the claim that Americans are more economically prosperous than the left lets on.

“It also turns out that 56% of Americans will at some point in their lives be in the top 10% of earners. 73% of Americans will be in the top 20% of earners in their lifetime. It’s an amazing statistic,” said Crenshaw.

Crenshaw pointed out that this means that the left is right, and the middle class is shrinking, but not because people are becoming impoverished, it’s because they’re moving up in the income brackets. Therefore, the narrative that income inequality is worse than ever is actually wildly inaccurate.

“This is all good news – doesn’t mean we can’t improve – the point is that the rhetoric about inequality is not only inaccurate, but it’s just flat-out unhelpful to the people we are actually trying to help,” said Crenshaw.

Crenshaw’s point was clear. The left gets too preoccupied with income inequality to the point where they actually set up roadblocks for people to become wealthy, or even come up with inane solutions that only make the problem worse like “universal basic income.”

They are effectively relying on socialism, which is a provenly failed method of economic governance, to fix problems that we’re not even having in the first place. At least not on a scale nearly so bad as the left is claiming.

The Daily Wire even backed up Crenshaw’s point by referring to various sources that showed America has been improving for years when it comes to upward economic mobility:

According to AEI’s Mark Perry, using data from the U.S. Census Bureau, from 1967 to 2017, the percentage of high-income households in the United States increased from 9% to 29.2%. Meanwhile, the percentage of low-income households decreased from 37.2% to 29.5%. The share of middle-income households did shrink (from 53.8% to 41.3%), but many moved upward.

A 2018 publication from Pew Research states: “From 1971 to 2011, the share of adults in the middle class fell by 10 percentage points. But that shift was not all down the economic ladder. Indeed, the increase in the share of adults who are upper income was greater than the increase in the share who are lower income over that period, a sign of economic progress overall.”

While Crenshaw is right, and we can always improve, we need to begin looking at ways to use positive solutions for the economy instead of continuously resorting to solutions to “even the playing field.” The goal isn’t to be even, the goal is to get ahead. Onward and upward.


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Sheer Brilliance: AOC Points Out That Raising the Poverty Line Would Show That More Americans Live in Poverty

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Rep. Alexandra Ocasio-Cortez, D-N.Y., addresses The Road to the Green New Deal Tour final event at Howard University in Washington, Monday, May 13, 2019. (AP Photo/Cliff Owen)

Rep. Alexandria Ocasio-Cortez (D-NY) says she’s on a mission to tackle poverty in America, but that to understand the full scope of what we’re dealing with some big changes in the poverty line must be made.

In an interview she did Wednesday on CNN, the freshman Congresswoman was asked by Prime Time host Chris Cuomo about a new legislative package of six bills she introduced earlier this week. The bills, she asserted in a statement at the time, will help us “once again recognize the breadth and consequences of poverty in this country and work together to ensure a path forward to economic freedom for everyone.”

She told Cuomo on Wednesday that when it came to poverty, it was time to “push the bounds” (and, of course, to forcibly share prosperity):

And we have to establish an advanced society here in the United States of America. What that means is that we have to push the bounds. We have to start treating housing as a right. We need to start protecting renters. We need to start updating the federal poverty line.

Our last – our – our calculation for the federal poverty line is based on 1955 spending habits that assumes one income earner, a stay-at-home mom, and that’s why we don’t talk about child care. That’s why we don’t talk about geographic differences in cost of living.

So, we need to update our poverty line. We need to address the housing crisis in this country. We need to stop treating people who duly paid their debt to society, the formerly incarcerated, as – as – as outcasts for the rest of their lives.

The problem we have here in America, according to AOC, is that people are making a lot of money but not enough of it is cascading down to everyone else. In fact, she suggests the problem is so bad that if we raised the poverty line, it would actually show that even more people were living in poverty (really!):

The problem is that America is at its wealthiest point that we’ve ever been. And yet, we’ve – we are at one of our most unequal points that we’ve ever been. You would not know that our country is posting record profits because 40 million Americans are living in poverty right now.

And if the poverty line was real, if it was at around what some people think it should be, about $38,000 a year, we will be shocked at how much the richest society on the planet is – is allowing so much of its people to live in destitute.

Watch AOC make this brilliant deduction below:

Well, um, yeah. I mean, if you raised the poverty line to $60,000 that would add even more to the poverty rolls.

Good grief.

Beyond the ridiculousness of her comment, lets take a look at a few stats:

Here are the poverty guidelines for up to a family of three (which Twitter users also pointed out):

So what AOC is proposing is to triple the poverty rate for a single person from what it is now to $38,000.

A family of two, three, four can live on $38,000 a year if they live within their means.

A family of seven is considered living in poverty in America if their household income is around $38,000, which actually makes more sense than AOC’s wild calculations:

I’d like to think AOC didn’t actually run the numbers on this before she proposed it, but I’m sure she did and went with it anyway. Because when it comes to “spreading the wealth”, no dollar amount is too high to Democrats.

— Based in North Carolina, Sister Toldjah is a former liberal and a 15+ year veteran of blogging with an emphasis on media bias, social issues, and the culture wars. Read her Red State archives here. Connect with her on Twitter. –

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Imogen Sinclair: Burke offers a solution to the decline of community

Imogen Sinclair works at the Centre for Social Justice, leading research on transforming deprived communities.

“What would you be doing if you weren’t here this morning?”, I asked Bill, who is a regular player at Treherbert Bowls Club in the Rhondda Fawr Valley. “At home, drinking, bored”, he replied, along with a chorus of affirming murmurs and nods from fellow players.

For Bill, playing bowls is much more than a Friday morning jaunt. And for millions more, our libraries, youth clubs and sports pitches are places on which people depend for social capital. Social capital? Pounds and pence are the coin of the realm, but this year I spent time with community groups in some of our most deprived neighbourhoods to understand what bowls, reading groups and bingo clubs can afford them. The CSJ’s latest report, Community Capital, released today, presents how purposeful participation in such activity empowers humans to flourish.

It was immediately apparent that despite economic decline in many of our town and cities, as long as there are people then “little platoons” will continue to form around shared experiences, interests and values. Burke taught us to respect the platoons, for they are the mediatory institutions that occupy the space between the individual and the state. Accordingly, this space must not be surrendered such that individuals are left with only the state to depend on.

Like Bill, Shelley told us that the Bowls Club provides respite from being the sole carer for her husband. And for Julie, a reading group shapes her week by providing something to look forward to. Similarly, Mike told us, “nothing came out of my life” before he started attending a local youth centre.

This kind of community engagement is not just a nice story to line the cloud of economic hardship, it is vital for what is typically termed “wellbeing”. But why use today’s buzzword when some two millennia ago Aristotle opted for a much more zingy term to describe an ancient take on the same phenomenon, which translates to “human flourishing”?

Bill, Shelley, Julie and Mike’s social contributions empower them towards human flourishing; enabling them to realise their responsibility to people and cultivate a belonging to place. At this, the policy wonks of Westminster enquire “What is the intervention?” Relationships. “And the referral process?” The door, open from 9am. “What is the economic impact?” Well, the invaluable support – effectively unpaid work – offered by family, neighbours and local community groups, was valued by the Office for National Statistics in 2014 at £1 trillion, equivalent to 56 per cent of GDP.

There was much furore at George Osborne’s trebling of a fund to repair listed church roofs in 2015. But the social capital that such spaces like churches afford people must not be left out of Treasury calculations.

John Hayes, who chaired the Working Group for this report, is a long-time advocate for such places as the guarantors of the stability which spawns shared meaning to human lives. He contends that if social capital is the train, then social infrastructure is the track. Our prized economy depends on long-term sustainable enterprise and industry, and so our social fabric depends on social infrastructure. Our Prime Minster vowed to support “vital social and cultural infrastructure, from libraries and art centres to parks and youth services: the institutions that bring communities together, and give places new energy and new life”.

But just last year, the Local Trust found that post offices, pubs, libraries, youth centres, children’s centres, banks, bingo halls, churches, playground facilities, museums, and parks had declined over the past few decades. For the Burkeans among us, this is a tragedy.

There is one final and crucial point that must be made about social infrastructure, and I address it to government. Building community is primarily about shifting power, rather than a new intervention. Our most vulnerable and disadvantaged Britons are not only short of money, but sociologists and economist alike agree that intrinsic to poverty is a sense of powerlessness.

“Poverty is pain: it feels like a disease […] It eats away one’s dignity and drives one into total despair”, said one respondent to a study called Voices of the Poor. This can and must be addressed. Not by cash injections which lift people above an otherwise arbitrary financial threshold, but through fostering secure connections to families, institutions and places. Our communities cherish such places, and are therefore best placed to preserve them.

We must move away from the assumption that government must be the sole operator of filling gaps. There are some 390,000 civil society organisations who are well placed to offer intelligent, nurturing and local welfare. Back to Burke, I say. We must dignify civil society by giving our unsung heroes the tools to sustain social infrastructure. Instead, government must recognise the potential in civil society, and in the spirit of decentralisation, harness this. We need more community ownership of public buildings, we need to trust their judgment and allowing their pride of place to drive creative solutions to local problems.

And, more fundamental, we need to inspire a shift in the ambition of government to pursue a new agenda – human flourishing through measuring not just individual economic contributions, but purposeful participation in our village halls, libraries and youth clubs.

There is a great subterranean shift going on in our culture, a turning away from the brashly new, from the quick and modern, from the solely individualistic measure of personal fulfilment. We are reaching once again for connection, belonging, and a sense of meaning which goes beyond our own immediate gratification. What is left is for government to align with these values by measuring what matters.

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