RealClearInvestigations' Picks of the Week

RealClearInvestigations' Picks of the Week
October 10 to October 16, 2021

Featured Investigation:
Seminal 'Diversity = Profits' Research
Doesn't Fare Well Under the Microscope

Widely accepted research from the prestigious global management consultant McKinsey concluding that "diversity wins" corporate profits is coming under harsh scrutiny lately from independent scholars, Richard Bernstein reports for RealClearInvestigations. Bucking an article of faith in the C-suite, the critics say McKinsey provides no evidence that racial diversity in management helps the bottom line; they suggest that the consultancy has misleadingly shaded its own findings to make its case. Bernstein reports:

• Accounting professors from Texas A&M and the University of North Carolina say their deep dive into McKinsey’s data shows profitable financial performance preceding diversity -- not the other way around.
• They say McKinsey’s high company diversity scores are unclear about whether they mean people of most concern to the social justice movement, namely blacks and Hispanics. They could be Asian-Americans.
• McKinsey’s linkage of high diversity with dramatically higher financial returns looks implausible -- an astonishing improvement to attribute to a single factor. 
• Two other scholars write in the Harvard Business Review that there are plenty of reasons to promote diversity, but higher profits is not one of them.
• “Taking an 'add diversity and stir' approach ... will not spur leaps in your firm's effectiveness or financial performance,” they write.
• The claim that diversity leads to profitability has been used by powerful companies like Goldman Sachs and states like California to justify not just their own diversity programs but mandates for other companies as well. 

Biden, Trump and the Beltway

Hunter Biden Complicates WH Anti-Corruption Push
Politico
Could a book deal take down the Biden presidency? It is too soon to tell. But Politico reporter Ben Schreckinger’s new work, “The Bidens,” seems to have made it acceptable for some mainstream news outlets to finally acknowledge a fact they have long diminished and denied: the Biden family’s ethics problems. And, Schreckinger reports, they have a long history to mine.

In recent decades members of the First Family, including Hunter Biden, have repeatedly entered into financial relationships with people who have an interest in influencing their powerful relative — including taking loans from lobbyists; seeking business from labor groups; taking a job with a bank that relied on Biden’s support to pass a personal bankruptcy law loathed by progressives; and, of course, taking a seat on the board of a Ukrainian energy company, Burisma, that faced allegations of corruption, even as Biden headed up U.S. anti-corruption efforts in Ukraine. In December, Hunter Biden acknowledged the existence of a federal criminal investigation of his tax affairs, which has focused on his dealings overseas, including in China. Politico also reported on the FBI’s interest in one of Biden’s brothers, James Biden, as part of an ongoing investigation of a hospital operator to which he was tied. That investigation, which remained active as of late last year, focused in part on alleged representations James Biden made in investment pitches about the value of his last name and influence, according to a former official with firsthand knowledge of it.

One place new-to-the-story reporters can start digging is the blockbuster Daily Mail report that Joe and Hunter Biden “shared accounts and paid each other's bills.” The article is based on emails from an accountant found on Hunter’s abandoned laptop, but it does not include specific information about financial transfers and transactions that would establish whether President Biden benefitted from his son’s alleged influence peddling. Reporters might also follow-up on a Washington Free Beacon article based on emails Hunter Biden sent while his father was vice president in 2010, in which he said his business relationship with a mysterious Chinese tycoon later arrested on money laundering charges had "everything to do with my last name."

More on Biden, Trump and the Beltway

Accused FBI Leaker McCabe Regains Pension Washington Post
Hunter Biden Gallery Saw Covid Loan Multiply Under Dad New York Post
Senate Democrats’ 'Dark Money' ATM American Conservative
Excerpt: How Trump's Pennsylvania Lawsuit Fell Apart Mollie Hemingway
Georgia: Workers Fired for Shredding Voter Applications Washington Examiner
Child Actors Used in Kamala Harris NASA Video Washington Examiner

Other Noteworthy Articles and Series

Baylor U. Steered Parents Into Colossal Debt
Wall Street Journal
For many lower and middle-class families, college seems like the unaffordable ticket to a better life. As a result, this article reports, many parents are taking out education loans they cannot repay. Until five years ago, undergraduates borrowed more than parents and grad students combined; now parents and grad students borrow more, according to the Journal’s analysis of federal data. Parents now owe $103.6 billion in Parent Plus loans, which Congress uncapped in the 1990s. Taxpayers bear the losses if the loans aren’t repaid. Defaults don’t hurt colleges, which get the money upfront. And so, some of the wealthiest U.S. colleges are steering parents into no-limit federal loans to cover rising tuition, which creates risk for everyone but themselves. This article details the issue by focusing on Baylor University. It has increased its tuition sharply to transform itself from a regionally known Baptist college into a national brand -- but is one of the least generous institutions when it comes to aid to needy students. This helps explain why Baylor parents have the worst record of repaying their Parent Plus loans.

Amazon Copied Products, Rigged Searches
Reuters
Amazon has repeatedly denied claims that it knocks off products it sells on its website and that it exploits its vast trove of internal data to promote its own merchandise at the expense of other sellers. But thousands of pages of internal Amazon documents examined by Reuters – including emails, strategy papers and business plans – show the company ran a systematic campaign of creating knockoffs and manipulating search results to boost its own product lines in India, one of the company’s largest growth markets.

The internal documents also show that Amazon employees studied proprietary data about other brands on Amazon.in, including detailed information about customer returns. The aim: to identify and target goods - described as “reference” or “benchmark” products - and “replicate” them. As part of that effort, the 2016 internal report laid out Amazon’s strategy for a brand the company originally created for the Indian market called “Solimo.” The Solimo strategy, it said, was simple: “use information from Amazon.in to develop products and then leverage the Amazon.in platform to market these products to our customers.” The Solimo project in India has had international impact: Scores of Solimo-branded health and household products are now offered for sale on Amazon’s U.S. website, Amazon.com.

Dominican Sugar Money Tax-Sheltered in South Dakota
Washington Post
The irony couldn’t be richer. No longer content to expose actual lawbreaking, activist journalists are increasingly seeking to “expose” entirely legal behaviors of which they don’t approve – based on purloined records. A few months ago, ProPublica used a trove of stolen IRS records to portray some of America’s richest citizens as tax cheats because they took advantage of legal deductions. Now comes this Washington Post article. It taps material from the Pandora Papers – a cache of more than 11.9 million secret documents obtained by the International Consortium of Investigative Journalists – to paint a South Dakota company in a bad light because its investors include a family from the Dominican Republican that runs a sugar operation accused of labor abuses.

This company — Central Romana — produces the sugar that Americans put in their coffee every morning and use to bake their birthday cakes. For years, Central Romana and other sugar producers in the Dominican Republic have faced allegations that they pay their workers substandard wages and force them to work in unsafe conditions. The company has denied mistreating its workers.

But the article acknowledges that there is no evidence in the leaked documents that any of the family’s South Dakota trusts shelter criminal proceeds. In addition, a lawsuit brought by families who say they were abused by the sugar company has been dismissed.

One Year After ‘Defund,’ Police Get Their Money Back
New York Times
Woke ideology is getting a reality check. This article reports that many police departments that saw their funding targeted amid nationwide protests over the killing of George Floyd in May 2020 are now receiving increased funding – including an additional $200 million allocated to the New York Police Department and a 3 percent boost for the Los Angeles force.

The abrupt reversals have come in response to rising levels of crime in major cities last year, the exodus of officers from departments large and small and political pressures. After slashing police spending last year, Austin restored the department’s budget and raised it to new heights. In Burlington, Vt., the city that Senator Bernie Sanders once led as mayor went from cutting its police budget to approving $10,000 bonuses for officers to stay on the job.

 

Coronavirus Investigations

The Mysterious Case of the COVID-19 Lab-Leak Theory
New Yorker
Did COVID-19 emerge in nature or was it manufactured in a lab? In the absence of definitive affirmative evidence for either scenario, this article reports that the debate continues because the argument against each scenario remains compelling. The theory that the virus jumped from an animal to human is undercut by the fact no such host animal has been found (which is unusual). The theory that it was created at the Wuhan Institute of Virology is undermined by a lack of hard evidence regarding such specific work – but this is hard to assess given China’s lack of cooperation. The difficulty of determining exactly what happened is underscored by the recent leak of a 2018 proposal involving Wuhan researchers and their American collaborators that ...

... detailed an ambitious plan to identify, model, and test the spillover risk of novel sars-related bat coronaviruses, then develop vaccines for the horseshoe bats themselves, to preëmpt viruses from jumping into other animals or people. What stood out was their plan to insert “human-specific” furin cleavage sites into sars-like bat coronaviruses. The furin cleavage site is the single most distinguishing feature of sars-CoV-2 [COVID-19]. It’s “the magic sauce of this virus,” Michael Worobey, an evolutionary biologist at the University of Arizona, said recently. “Whether it’s natural or genetically modified, this is why this virus is circulating in humans.” … sars-CoV-2 is the only virus known to possess a furin cleavage site in its section of the coronavirus family tree. 

Sounds like a smoking gun, except the U.S. government turned down the proposal considering it too risky. It is not known whether the work was conducted anyway. We do know that people involved in the proposal, including Ralph Baric at the University of North Carolina at Chapel Hill, and Peter Daszak, president of the EcoHealth Alliance, which is dedicated to mitigating the emergence of infectious diseases, “never publicly mentioned that they had proposed these experiments,” after the pandemic emerged.

Other Coronavirus Investigations

Chiropractors a Rising Force of Vaccine Mistrust Associated Press
America’s Port Crisis Up Close New York Times
'Containergeddon': Retailers Hiring Own Ships Reuters