December 6, 2023

Economix Blog: On Whether the Rich Pay Too Little in Taxes



Dollars to doughnuts.

On Tuesday Bruce Bartlett mentioned that a majority of Americans believe that high-income people do not pay enough in taxes. That majority, though, has been shrinking over the last couple of decades, according to new data from Gallup.

Source: Gallup. Latest poll was conducted through telephone interviews April 4-7, 2013, with a random sample of 1,005 adults. The margin of sampling error is plus or minus 4 percentage points. Totals do not sum to 100 percent because some respondents answered “no opinion.” Source: Gallup. Latest poll was conducted through telephone interviews April 4-7, 2013, with a random sample of 1,005 adults. The margin of sampling error is plus or minus 4 percentage points. Totals do not sum to 100 percent because some respondents answered “no opinion.”

Gallup asks respondents about whether they think members of different income groups are paying “their fair share in federal taxes, paying too much or paying too little.” In 1992 and 1993, 77 percent of Americans said that upper-income people paid too little. Today, the share is 61 percent.

That change in public opinion seems to contradict the trend in the actual tax burden faced by high-income households. As a New York Times data analysis showed last fall, the average tax rate paid by people of all income classes has fallen since the mid-1990s, including that for wealthier people.

That said, the share of the nation’s total tax bill that is paid by the wealthy has been growing — but that’s because the incomes of the wealthy have increased so strikingly, faster than the individual tax rates they face have fallen. And of course Congress did raise the top marginal tax rate for 2013.

Meanwhile, as I noted last year, Americans have become much more critical of the tax share paid by the poor.

Source: Gallup. Latest poll was conducted through telephone interviews April 4-7, 2013, with a random sample of 1,005 adults. The margin of sampling error is plus or minus 4 percentage points. Totals do not sum to 100 percent because some respondents answered “no opinion.” Source: Gallup. Latest poll was conducted through telephone interviews April 4-7, 2013, with a random sample of 1,005 adults. The margin of sampling error is plus or minus 4 percentage points. Totals do not sum to 100 percent because some respondents answered “no opinion.”

In 1992, 8 percent of Americans said lower-income people paid too little in taxes. When the question was asked this month, the share was 19 percent, perhaps resonating with the sentiment expressed by Mitt Romney’s “47 percent” comments.

Article source:

Political Economy: Finest Hour for Draghi and Europe

Who is Europe’s most powerful man? If one phrased the question differently — who is Europe’s most powerful person? — the answer might well be Angela Merkel. But the deliberate use of the masculine excludes the German chancellor, leaving the field open to Mario Draghi.

This answer can, of course, be disputed. How can one compare power in economics with power in, say, religion? Is it possible to rank the technocratic European Central Bank boss on the same scale, for example, as the pope?

The best place to start is with an attempt to understand what power is. The British philosopher Bertrand Russell said it was the production of intended effects. By contrast, Steven Lukes, one of the top contemporary power theorists, said in an interview last week that power was the capacity to make a difference in a manner that is significant.

What’s appealing about the way that Mr. Lukes, a professor of sociology at New York University, puts things is his use of the word “significant.” Whereas Mr. Russell just looks at whether people can get their way, the introduction of significance allows us, as observers, to take a view about whether powerful people are affecting things in a manner that matters to us.

That, in turn, allows us to rank individuals’ power. We can decide that right now in Europe, what matters most is navigating the current euro crisis and pick our ranking with that in mind. That, indeed, is my view — which, of course, is somewhat subjective.

Let us return to Mr. Draghi, whom I have known since the mid-1990s. To see why he is so powerful, it is worth considering the three P’s of power: position, personality and pivot points. Having a position that enjoys authority; possessing a personality that is astute enough to maximize the use of that authority; and operating at a point in history where one’s actions have the chance to be pivotal — all these are important ingredients in the power mix. Mr. Draghi scores highly on all three.

Look, first, at position. The E.C.B. has the sole authority to print money for the 17 member countries of the euro monetary union. Mr. Draghi has used this power to huge effect since he took over as president in November 2011. First, the E.C.B. lent banks €1 trillion, or about $1.3 trillion, helping to avert a banking crisis.

Then, in July, during a particularly hot phase of the crisis, Mr. Draghi uttered his famous phrase about doing within the E.C.B.’s mandate “whatever it takes to preserve the euro,” adding, “and believe me, it will be enough.” The E.C.B. later spelled out its willingness to spend potentially unlimited sums of money buying sovereign bonds. The markets calmed down.

The E.C.B.’s power does not just come from its money-printing authority, but also from its independence — which is enshrined in the Maastricht Treaty that established the European Union. Although its president is appointed by politicians, he gets an eight-year term. Once he is in place, he can only be removed in the event of incapacity or serious misconduct. Unlike prime ministers and presidents, he does not have to face the electorate. Mr. Draghi is in an especially strong position because his term has seven more years to run; he is not remotely a lame duck.

The Italian central banker, though, has not just relied on this strong position. His personality is particularly well suited to wielding power. For many years, he survived and thrived while playing Rome’s power games. This is partly because, like a chess grandmaster, he always thinks several moves ahead. That gives him a good understanding of the dynamics of a situation.

Mr. Draghi also gives huge importance to credibility. Through his orthodox central banking rhetoric, he convinced the German people that he was really not from Southern Europe at all. If he had been considered to be more Italian, he would not have gotten the E.C.B. job in the first place. Bild, the influential German tabloid, even celebrated his nomination as E.C.B. president by running a doctored photo of him wearing a Prussian spiked helmet.

Bild did turn on Mr. Draghi after his promise to buy potentially unlimited quantities of sovereign bonds. But, critically, Ms. Merkel — whose approval was not required but whose tacit support gave him valuable cover — did not.

Mr. Draghi’s credibility with the markets has also magnified his influence. So much so that he has not yet even needed to buy a single sovereign bond.

Position and personality, though, are not the only ingredients of Mr. Draghi’s power. He has taken the role of E.C.B. boss at a pivotal moment, when the power to print money is crucial. In a financial crisis, the ability to supply liquidity is of paramount importance.

Mr. Draghi has understood the importance of pivotal points in history and used his position and personality to have a big impact. As such, he scores AAA on the three P’s of power — in a way that puts him ahead of, say, Mario Monti of Italy or François Hollande of France, neither of whom would get straight A’s.

The E.C.B. boss should not let the plaudits go to his head, however. Much of the euro zone is in deep recession. If growth does not return, the crisis could enter a new ugly phase, and his powers will be sorely tested.

Hugo Dixon is the founder and editor of Reuters Breakingviews.

Article source:

Preoccupations: Building the ‘Watson’ Team of Scientists

When I stepped up to lead the team at I.B.M. that would create this computer, called Watson, I knew the task would be formidable. The computer would have to answer an unpredictable variety of complex questions with confidence, precision and speed. And we would put it to the test in a publicly televised “human versus machine” competition against the best players of all time.

It was not easy finding people to join the Watson team in the mid-1990s. Most scientists I approached favored their own individual projects and career tracks. And who could blame them? This was an effort that, at best, would mingle the contributions of many. At its worst it would fail miserably, undermining the credibility of all involved.

Scientists, by their nature, can be solitary creatures conditioned to work and publish independently to build their reputations. While collaboration drives just about all scientific research, the idea of “publishing or perishing” under one’s own name is alive and well.

I remember asking some researchers how long they had been working in natural language processing — the field of computer science focused on getting computers to interact in ordinary human language. For many, it had been well over a decade.

I asked them if they preferred spending the next 10 years as they had the first 10, publishing isolated research results and earning modest acclaim within a niche community. Or would they like to see whether the technology that had been their life’s work could accomplish something monumental?

For the scientist in me, it was an irresistible challenge. I believed it was a rare opportunity to counter conventional wisdom and advance technology. I was willing to live with possible failure as a downside, but was the team?

A few people were extremely hesitant to join the project and later left, thinking that the whole enterprise was insane. But a majority bought in. We eventually pulled together a core group of 12 talented scientists, which over time grew to 25 members. It was a proud moment, frankly, just to have the courage as a team to move forward.

From the first, it was clear that we would have to change the culture of how scientists work. Watson was destined to be a hybrid system. It required experts in diverse disciplines: computational linguistics, natural language processing, machine learning, information retrieval and game theory, to name a few.

Likewise, the scientists would have to reject an ego-driven perspective and embrace the distributed intelligence that the project demanded. Some were still looking for that silver bullet that they might find all by themselves. But that represented the antithesis of how we would ultimately succeed. We learned to depend on a philosophy that embraced multiple tracks, each contributing relatively small increments to the success of the project.

Technical philosophy was important, but so were personal dynamics. Early on, I made the unpopular decision to bring the entire team together in a war room, to maximize communication. The shared space encouraged people with wildly different skills and opinions to exchange ideas.

The early practice rounds for “Jeopardy” were downright disappointing. Many of Watson’s answers were stupid and irrelevant, some laughably so. Each wrong answer demonstrated the profound failings of simple search-based technologies and showed how sophisticated Watson needed to become.

We had to keep the team’s collective intelligence from being overcome by egos, or dragged down by desperation. Leadership had to be steadfast and persistent but grounded in optimism. Through it all, the team developed a culture of trust that let creativity flourish.

IN the end, the hero was the team, not any individual member or algorithm. Eventually, everyone came to appreciate that. Well into the throes of the project, one researcher commented, “Compared to the way we work now, it’s like we were standing still before.”

Watson went on to win “Jeopardy” a year ago, but its work is far from over. Now we and other research and development teams at I.B.M. are busy developing ways to put Watson to work in several different areas, most notably health care.

As for the members of the original Watson team, they’d tell you that never in a million years could they have imagined what we accomplished. Just like Watson itself, we all learned that the sum is much greater than the parts.


Article source:

Advertising: To Promote Brisk Tea, Pepsi Enlists the Aid of Yoda

This week, the company is introducing new product packaging and a new mobile game app — featuring Yoda and Darth Maul, characters from the film, originally released in 1999 — created for Brisk’s target market, young adults, particularly males, ages 18 to 29. The initiatives will be the focus of the largest multimedia advertising and marketing campaign that PepsiCo has ever waged for Brisk.

PepsiCo has bottled and marketed Brisk, a Lipton ready-to-drink tea brand, through a joint venture with Unilever, owner of Lipton, since 1991. It has also worked with Lucasfilm to promote the “Star Wars” franchise since 1997.

The new campaign is the brainchild of Mekanism, the San Francisco-based agency PepsiCo hired in 2010 that revived Brisk’s clay-animated commercials from the mid-1990s. The original spots parodied figures like Frank Sinatra and Babe Ruth, while the new Mekanism Brisk ads have featured Eminem — in a Super Bowl XLV commercial — as well as Danny Trejo and Ozzy Osbourne.

Industry observers and executives involved with the campaign say Mekanism’s efforts to increase Brisk’s social media presence and sales have been successful. According to Ian Kovalik, a creative director of Mekanism, the number of Brisk’s Facebook fans has jumped to 950,000 from 10,000 in late 2010.

Eric Fuller, brand director for Brisk, said the brand’s sales had more than doubled in the last two years, to a projected 104 million cases this year from 48 million cases in 2009. Similarly, according to data provided by Larry Finkel, director of food and beverage research for, Brisk’s dollar sales in supermarkets, drugstores and mass merchants excluding Walmart rose 12 percent, to $94.3 million, in the year ending April 17, 2011.

That rate of growth far exceeded the rate of dollar sales growth of PepsiCo’s other Lipton ready-to-drink tea brands, Lipton, Lipton Diet, Lipton PureLeaf and Tazo.

Brisk’s rate of dollar sales growth also exceeded that of rival brands Arizona, up 3.5 percent, and Snapple, up 6.2 percent. During this period, Arizona Beverage Company brands generated 30.8 percent of all ready-to-drink tea dollar sales, PepsiCo 29.9 percent and the Dr Pepper Snapple Group 17.2 percent, Mr. Finkel said.

The 3-D release of “Phantom Menace” is slated for Feb. 10, and the “Star Wars” campaign is aimed at continuing Mekanism’s success in increasing Brisk’s social media presence and sales. PepsiCo’s initiatives will include the introduction, starting Tuesday, of special “Star Wars” packaging and promotions at retailers.

Among these are a one-liter, limited-edition bottle of raspberry iced tea with a Darth Maul label; codes under caps of one-liter bottles of Brisk’s 12 teas and juice drinks, which will help buyers play the “Star Wars” mobile game; and a new one-gallon jug, in four flavors, for home consumption.

On Wednesday, a new Brisk Saber mobile game app — developed by Flying Wisdom Studios of San Francisco — will be introduced in the Android and Apple marketplace; players will be able to unlock new game characters, vehicles and weapons by redeeming bottle cap codes. The app will be promoted on Facebook and Hulu, and through Tapjoy, an app ad network, beginning Jan. 9.

On Jan. 15, 15- and 30-second TV spots will start running, initially on Fox Broadcasting’s Sunday night “Automation Domination” programming, and subsequently on network and cable stations like Adult Swim, Comedy Central, MTV, Spike and Syfy.

The 30-second spot shows Yoda and Darth Maul beginning to fight. Darth Maul’s light saber malfunctions many times before he falls into a Brisk vending machine. Although he is reinvigorated when he drinks the iced tea, just as he again tries to attack Yoda, the vending machine squashes him. Yoda says, “Too old for this I’m getting,” while the voice-over proclaims, “That’s Brisk, baby,” a tagline introduced in Brisk’s original animation spots.

More than 500 movie theaters in 15 states that sell PepsiCo beverages will run the TV spots for two months starting Friday; similar radio ads will run starting Jan. 23 on stations in New York and Southern California. Brisk also will hold sampling events across the country from late January through mid-March.

Mr. Fuller said Brisk’s 2012 advertising and marketing budget would be in the “low double digits” of millions of dollars, the most PepsiCo had ever spent to promote the brand. He also said 75 percent of this spending would occur in the first quarter of the year.

According to the research firm Kantar Media, PepsiCo’s annual advertising expenditures for Brisk never exceeded $670,000 in 2007, 2008 and 2010, and totaled $4.7 million in the first nine months of this year. It said PepsiCo did no advertising for Brisk in 2009.

Industry observers and experts differed about the prospects of the PepsiCo campaign.

Noting that recently rising commodity prices had led to higher prices for ready-to-drink teas and subsequent softening of sales growth, Michael Bellas, chairman and chief executive of Beverage Marketing, a consulting company, called Brisk the “dominant value brand” in the ready-to-drink tea category.

“Consumers are more worried about spending and looking for value. My gut feeling is the new 128-ounce packaging and gaming should put Brisk right where it wants to be,” he said.

However, Irma Zandl, a New York-based market researcher who specializes in Generation X and Y consumers and has advised PepsiCo in the past, said the new ads “executionally felt very formulaic.”

“They felt like every other 30-second spot with a superhero,” Ms. Zandl added. “I didn’t feel, ‘Wow, I’ve got to post them on Facebook because they’re so fresh.’ The question is, will young guys think this is so amazing and fabulous? Young consumers are so much savvier and have set the bar so much higher because they see so much.”

Article source:

Advertising: Sign of Arrival, for Xinhua, Is 60 Feet Tall

Xinhua, the news agency operated by the Chinese government, is leasing a giant sign, known as a spectacular, on 2 Times Square, the building that is the northern anchor of the district. The new LED sign, 60 feet high by 40 feet wide, is being built for Xinhua (pronounced Shin-wa) and is scheduled to make its debut next Monday.

Xinhua, which has recently expanded its business presence in the United States, is taking over the space on 2 Times Square that had been occupied for the last decade by the HSBC bank. The HSBC lease expired and was not renewed. The sign for Xinhua, which means New China News Agency, will be underneath the sign for Prudential, an American company, and above signs for Samsung (South Korean), Coca-Cola (American) and Hyundai (South Korean).

Chinese brands have previously occupied signs in Times Square. For instance, in the mid-1990s the 999 Pharmaceutical Company leased a painted vinyl sign atop two buildings at the southeast corner of Seventh Avenue and 48th Street.

And in January, the Chinese government ran promotional commercials on six oversize screens in Times Square featuring celebrities like the retired basketball star Yao Ming and the pianist Lang Lang. The campaign, deemed the biggest such effort by Beijing, was timed to coincide with the visit to the United States by the Chinese president, Hu Jintao.

Also, Haier, a Chinese company that makes appliances, has its name on a building at 1356 Broadway, at 36th Street.

Still, the arrival of Xinhua on 2 Times Square is significant because of the building’s premier location in the so-called crossroads of the world. In the 1970s and 1980s, Japanese and South Korean marketers like Fuji, GoldStar, JVC, Sony and Samsung began leasing signs on Midtown Manhattan buildings like 2 Times Square and its sibling, 1 Times Square. It was considered a signal of their arrival in the global consumer marketplace.

“A lot of Chinese companies are coming, or getting ready to come, into this country with their own brands,” said Jeffrey Katz, the chief executive and principal owner of Sherwood Equities, a commercial real estate firm with properties that include 2 Times Square and 1 Times Square and that also owns the subsidiary Sherwood Outdoor, which oversees the spectaculars on both of those buildings.


In May, Xinhua moved its North American headquarters from Woodside in Queens to a tower in Times Square, 1540 Broadway, at 45th Street. And last year, Xinhua introduced a 24-hour English-language broadcast service, China Network Corporation, or CNC World, that seeks to reach 50 million viewers around the world.

Xinhua also recently began aggressively marketing its news wire service, particularly in the developing world, with a goal of competing with news agencies like The Associated Press, Bloomberg News and Reuters. (The Reuters building at 3 Times Square, on Seventh Avenue between 42nd and 43rd Streets, is decorated with huge video ad screens.)

Like the Japanese and South Korean brands that came to Times Square to better familiarize the United States with their products, the arrival of Xinhua is a prominent expression of its ambitions with Americans, many of whom are either unfamiliar with the state-owned news agency or associate it with relics like Tass, the official disseminator of government news releases in the Soviet Union.

Executives of Xinhua did not respond to questions sent last week by e-mail asking about their decision to lease the sign at 2 Times Square.

According to Brian Turner, president of Sherwood Outdoor, Xinhua signed a long-term lease for the space, which he described as “in excess of six years.” He and Mr. Katz said they hoped the lease would be a harbinger of other Chinese brands coming to Times Square.

Mr. Katz dismissed a suggestion that the presence of a Chinese brand in such a marquee location might discomfort some Americans.

“They’re leasing it,” Mr. Katz said of the sign. “They’re not buying it.”

“That’s good for the home team,” he added.

Mr. Turner echoed Mr. Katz, noting the continuing presence on 2 Times Square of Coca-Cola and Prudential.

“There’s nothing more American” than those brands, Mr. Turner said.


The last change of signs on 2 Times Square occurred in 2009, when Hyundai replaced Pontiac, a brand that was discontinued by General Motors.

Mr. Turner and Mr. Katz declined to discuss the financial terms of the lease for the Xinhua sign. However, signs in top-drawer locations in Times Square can rent for as much as $300,000 to $400,000 a month.

The expansion efforts by Xinhua are driven partly by a desire to counter what officials in the ruling Chinese Communist Party say is widespread bias against China in Western media reporting. The idea, Chinese leaders said, is to burnish the country’s image and give China a voice to match its newfound economic might.

Many media analysts, however, are skeptical that Xinhua will make much headway anytime soon in markets like North America and Europe, where residents are sophisticated and often look askance at information delivered by news agencies owned by governments — any governments.

Also, reports by Xinhua on topics like Taiwan and Tibet, which are of considerable political concern to its government bosses, are not necessarily known for being objective.

Andrew Jacobs and David Barboza contributed reporting.

Article source:

Deutsche Bank Star Fights to Take the Reins

A banker with a pied-piper quality, Mr. Mitchell persuaded Mr. Jain and 500 others to leave secure jobs at Merrill Lynch in the mid-1990s to help him transform Deutsche Bank from a slumbering financial institution focused mostly on traditional lending to German companies and individuals into a global powerhouse that generated half its profit from trading and deal-making. At the peak of his success, in late 2000, Mr. Mitchell was killed in a plane crash.

In building Deutsche’s investment bank, Mr. Mitchell formed the template for the global universal bank that has since been emulated — for good and ill — by Citigroup, Royal Bank of Scotland, JPMorgan Chase, UBS and Barclays.

At the age of 48 — about the same age as Mr. Mitchell when he died — Mr. Jain controls all of his former mentor’s empire, and more. In a given quarter, those operations may produce as much as 90 percent of the banking giant’s profit. Now he is confronting the same obstacle that confounded Mr. Mitchell and prompted him to start looking for another job in the days before he was killed.

As a non-German speaker and Wall Street product, Mr. Jain is facing an uphill battle to succeed Deutsche Bank’s chief executive, Josef Ackermann.

More diplomat than banker, the Swiss-born, German-speaking Mr. Ackermann and the Deutsche board have resisted persistent shareholder demands that the bank put forward a succession plan before Mr. Ackermann’s contract expires in 2013.

All of which has enhanced the view that Mr. Ackermann sees it as his legacy to crown a successor in his own statesman-like mold — perhaps Axel A. Weber, the recently departed head of the German central bank. There has been much talk of Mr. Weber becoming chief executive or coming in to share the job in some way with Mr. Jain.

Ultimately it will be a board decision, and the bank may well decide to anoint Mr. Jain. But the delay, institutional shareholders say, runs the risk of alienating Mr. Jain and might cause him to jump to another investment bank.

“In Germany, no one can imagine an Indian working in London who does not speak German being the C.E.O. of Deutsche Bank,” said Lutz Roehmeyer, a portfolio manager at LBB Invest in Berlin and a large shareholder. “But Deutsche Bank is an investment bank now, and Mr. Jain deserves to run it.”

On a narrow profit and loss calculus, that may be so. But even though Deutsche’s risk taking was not as outlandish as that of others, the bank was an enthusiastic participant in the United States mortgage boom and is being sued for $1 billion by the United States government, which contends that its mortgage unit engaged in fraud and deceived regulators to have their loans guaranteed.

While the majority of the alleged fraud took place before Deutsche acquired the mortgage operation, Mr. Ackermann and the Deutsche board may well be wary of choosing a bond and derivatives technician at a time when the practices of all major banks are still being scrutinized.

People who have spoken to Mr. Jain say that he recognizes this is a board decision and that his priority is to keep the profits coming. But, these people say, the delay and the possibility that Mr. Ackermann may not support him for the job has had its effect.

During a brief interview Tuesday, Mr. Jain took issue with rumors in the market that his relationship with Mr. Ackermann — never close to begin with — had cooled and that he might leave the bank.

“I have been given a huge new opportunity to integrate the investment bank and I am very excited about that,” he said. “As for my relationship with Joe, it is as good as it ever was in almost 15 years of working together.”

Mr. Ackermann declined to comment on the question of his successor, but he has in the past made it clear that the decision to pick the bank’s next leader is the board’s responsibility — with his input of course — and that his contract runs until 2013.

Article source:

Majestic Views, Ancient Culture and a Profit Fight

That the views are spectacular, no one would dispute. But a fierce legal battle has erupted over whether these are million-dollar views or whether they are considerably more valuable than that. The controversy threatens to slow the parade of tour buses, helicopters and planes that arrive daily and have put the Hualapai (pronounced WALL-uh-pie) reservation on the map.

Having a reservation a three-hour drive from the hustle and bustle of the Las Vegas Strip has proved both a curse and a blessing for the Hualapai, who control a million acres in northwestern Arizona but have long struggled to make ends meet.

When the 2,100-member tribe, which has had unemployment rates of well over 50 percent in years past but has brought them steadily down, introduced casino gambling in the mid-1990s, the venture quickly went bust. Why gamble on Hualapai land, which is traversed by unpaved, tire-piercing roads, when there are games of chance galore just across the state line in Nevada?

But the Hualapais have something that Las Vegas does not — namely, their pristine reservation, which creeps right up to the western edge of the Grand Canyon, includes a stretch of the Colorado River and provides vistas as awe-inspiring as any row of cherries lining up neatly on a slot machine.

To improve its gambit to lure more visitors from Vegas, the Hualapai teamed up with a tour operator named David Jin in 2003 to create the Skywalk, which extends 70 feet beyond the canyon rim and provides unmatched views of the floor thousands of feet below. Success, though, has brought controversy.

Before the Skywalk opened in 2007, 150,000 visitors in a good year would peer over the canyon edge on Hualapai land or raft down the tribe’s portion of the Colorado. Last year, the number had more than quadrupled, with many of the visitors paying as much as $73 to slip on booties and edge their way out onto the horseshoe-shaped walkway of glass.

Canyon-side commercialism now abounds on Hualapai land. Helicopter tours begin at $129. At the fully stocked gift shop, arrows cost $20 and full-length Indian headdresses $2,000. A 90-minute horseback ride along the canyon rim costs $75. Revenues are in the millions of dollars, although exactly how much money is in dispute.

In exchange for the $30 million that Mr. Jin, who is Chinese-born and based in Las Vegas, spent to build the Skywalk, he was to get a portion of the Skywalk profits over 25 years and a cut-rate price for the many tourists he brings to the site from all over Asia. He accuses the Hualapai of shortchanging him and has gone to court — both the tribal court in the tribal capital of Peach Springs, Ariz., and United States District Court in Phoenix — to press the matter.

The Hualapai accuse him of not fulfilling his end of the bargain by leaving ancillary parts of the project unfinished.

The sparring, fueled by public relations consultants and prominent lawyers enlisted by each side, has largely been out of view of canyon visitors. They throw their hands in the air and pretend to be falling from the Skywalk as official photographers snap official shots. They tour a faux Indian village and watch performances by Hualapai elders, including Robert Tree Cody, an adopted son of Iron Eyes Cody, the non-Indian who portrayed one as an actor and shed a tear to lament the destruction of the natural world in an iconic 1970s TV commercial.

There was sadness among some Hualapai traditionalists when construction began at the edge of the canyon, which has long carried spiritual significance to those who live there. But that debate is now past, and plans are on the drawing board for even more bricks and mortar, including a major resort and a clubhouse for a planned canyon-side golf course.

But all those ideas seem like pipe dreams now as the Skywalk project, still not finished, finds itself stalled.

In court documents, Mr. Jin says tribal “infighting and irregularities” have complicated his dealings with the Hualapai, who he says have not paid him any profits since 2008. He said that the tribal tourism enterprise had gone through a succession of six chief executives since signing a deal with Mr. Jin in 2003.

Recently, the Hualapai removed their tribal chairman, Wilfred Whatoname, for unapproved disbursement of tribal funds. Several other tribal members have been removed for mishandling money, Mr. Jin’s representatives say.

“They have problems with accounting,” said Aimee Romero, a spokeswoman for Mr. Jin. “They have problems with their books.”

Hualapai leaders deny that the tribe has mishandled the Skywalk money, which they say is going to the betterment of tribal members. “It’s insulting,” Waylon Honga, a member of the Tribal Council, said with a scoff. “It’s really a low blow.”

Mr. Jin has gone to tribal court to try to force the Hualapai to enter into arbitration over the sharing of profits, and he sought a temporary restraining order in federal court aiming to prevent the Tribal Council from seizing his share of the Skywalk by using a recently passed eminent domain ordinance.

Mr. Jin failed to win the order, but a federal judge is now overseeing the dispute. Mr. Jin has hired Troy Eid, a former United States attorney in Colorado, to press his interests. Hualapai leaders have Paul Charlton, a former United States attorney in Arizona, on their side.

If visitors cast their eyes away from the canyon and at some of the half-finished projects around the Skywalk, they can see evidence of the legal standoff. The visitors’ center remains an unfinished construction site with exposed walls and ceilings, yellow “Caution” tape in place and no functioning utilities.

Documents produced by Mr. Jin’s representatives indicate that it was the Hualapais’ responsibility to provide the utilities at the Skywalk site. Documents produced by the tribe suggest the opposite.

“Eminent domain is an option the tribe is weighing,” Mr. Honga said. “We don’t want to go to that extent. We are hopeful that we can come to a resolution.”

In court papers, Mr. Jin estimates the Skywalk’s worth, over the next two decades, at $100 million and wants to be reimbursed his share if the tribe chooses to void the contract. Hualapai leaders say Mr. Jin would be paid “fair market value,” but call his estimate of the Skywalk’s worth absurdly high.

Article source: