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’STANGS FALL IN L.A. T

he season full of firsts came to an end on Sunday. After the Mustangs reached a program-record 40 wins at the Division I level and won their first-ever postseason game, Cal Poly fell in back-to-back matchups to UCLA on Saturday and San Diego on Sunday. It ends one of the most historic runs Cal Poly has seen. With the losses, the Mustangs walk away from the 2013 season with a 40-19 record and a 1-2 record in their second-ever trip to the postseason. For the full story on the Mustangs’ performance in L.A., see pg. 8

Monday, June 3, 2013

Volume LXXVII, Number 117

THE NEW ADMINISTRATION Since President Jeffrey Armstrong’s appointment in 2010, Cal Poly administration has radically changed, with nearly all of the top administrators leaving or retiring, and a new crop coming in.

From Start-up to Kickstarter ALEXANDRIA SCOTT

alexandriascott.md@gmail.com

2010

ATHLETIC DIRECTOR

m m ad No ha

a Larso eb r

e e oward-Gr

VP FOR UNIVERSITY ADVANCEMENT borah Rea ndra Ogren e a d D S

Bet sy Kinsle

2011

CHIEF OF STAFF

berhelm

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ENGINEERING DEAN

PROVOST e rt K o o b een Enz Fi R ob thl

see FARMGRAM, pg. 2

n ke

for articles, videos, photos, & more.

s o n C on e Ali

LIBERAL ARTS DEAN

CAED DEAN

Construction jobs sparse post-grad SASHA ALEXANDER

Special to Mustang Daily

uglas Eppers

VP FOR STUDENT AFFAIRS ith Humphre rnel Morton e o K C

e Thomas Jon

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Typical construction management students should expect four to five job offers at graduation this spring, construction management head Allan Hauck said. The economy this year is not like the days before the recession of 2008 hit, Hauck said. Typical graduating seniors were looking at five to 15 job offers,” he said. “But that hasn’t happened in four or five years.” The placement rate for construction management students was at 100 percent until five or six years ago, construction management associate professor Philip Barlow said. Students got the jobs they wanted until the recession hit and numbers went down. Placement has recently gone

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PRESIDENT

CHECK OUT

CAL POLY

see ADMINISTRATION, pg. 2

Local is the essence of Farmgram, from the idea to the product. Funding is the only outsourcing Cal Poly students Tessa Salzman, Tyler Thomas and Adrian Godby are using for their business idea. Farmgram aspires to deliver handcrafted meal boxes of locally grown foods to the doorsteps of San Luis Obispo residents, and online crowd funding has so far proven to be a success in making their idea into a reality, said Salzman, a city and regional planning senior. “We wanted to work for ourselves after graduation, and we are all really passionate about local food systems in general,” she said. “We want to build the local economy while delivering fresh and local healthy foods that gets farmers more business.” Basically, Farmgram will

Armstro frey ng f e J

arren Baker

With Cal Poly Vice President of Administration and Finance Larry Kelley’s retirement announcement in May, he became the latest in a string of top administrators to leave the university in the past two-anda-half years. University President Jeffrey Armstrong’s chief of staff, provost, vice president of student affairs, vice president of university advancement and athletic director have all changed since he was chosen for the position in late 2010. Five of six college deans have also left their posts since 2010 or are planning to leave after this academic year. Armstrong said each administrator’s decision to leave involved different factors, and it is not uncommon for a university to see change at its highest levels when a new president is hired. “I think it’s more of a matter of time than anything else,” he said. “People get to various situations, they get to a point where there’s time for a change where they’re ready to retire.” National Association of Presidential Assistants in Higher Education administrator Linda Ryan echoed Armstrong, saying university presidents across the country often work with a fresh leadership staff when they come to a new university. “I think it’s very common, probably more so from the vice president standpoint, to be looking for other jobs when they know a new president is coming in,” Ryan said. When Armstrong looks to replace administrators, he allows search committees to do initial screenings of candidates. He said he relies on them to judge the technical side of applicants — for the president, it’s a question of who has the right “fit.” “Regardless of the position that we’re interviewing for, I look for fit,” Armstrong said. “I look for a particular individual, and I want to know and to think to myself, ‘How will this person interact with our students, faculty and staff? How will they fit in as a Cal Poly family member?’” The president said he is grateful for the honest discussions he has with other leaders at Cal Poly and enjoys working with those who have

2012

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2013

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replacement unannounced DID YOU KNOW?: College of Science and Mathematics Dean Phil Bailey is the only dean who will have been at Cal Poly before Armstrong’s appointment. Bailey has served as dean since 1983.

ARTS, pg. 4 Shwayze’s fashionably late UU show.

Tomorrow’s Weather: high Sunny sunny

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see CONSTRUCTION, pg. 2

INDEX

Opinions/Editorial..............6 News.............................1-3 Classifieds/Comics............7 Arts...............................4-5 Sports..................................8

low 52˚F partially cloudy

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MDnews 2 CONSTRUCTION continued from page 1

back up, getting close to 100 percent again, he said. Approximately 75 to 85 percent of graduates got the jobs they wanted before the recession, he said. “Students got signing bonuses, they got trucks, company cars, the whole bit,” Barlow said. “It was quite a good time for us through the ’90s and early 2000s, and then we hit this recession.” In 2008, the construction

FARMGRAM continued from page 1

coordinate all the local ingredients necessary to make a meal with recipes coming from local chefs, Salzman said. The meal themes are breakfast, juicing and mealwith-friends. Salzman first pitched a business plan similar to Farmgram at Cal Poly’s StartUp Weekend in January, and ended up winning two free months at the San Luis Obispo HotHouse, she said. The HotHouse helped Farmgram with business creation essentials such as a business plan, financial advice and marketing strategies. “We are ruing to find a way to differentiate ourselves and make Farmgram a more specialized service of themed boxes that will help people to cook,” she said. “Our targets are parents and students; we can provide them with recipes and all the local goods.” As the HotHouse free rent came to an end, the group applied for a spot in the HotHouse summer accelerator program, but didn’t make the cut, she said. Instead the group looked to Kickstarter, a website where entrepreneurs can get donations for projects and for investments,

market collapsed, Hauck said. Depression-level unemployment rates held more than two-and-a-half years. Unemployment level in construction averaged 20 to 24 percent. Unemployment affected student placement for approximately three years. Construction management was placing about 50 to 60 percent of its graduates, Hauck said. Construction management went from a $1.2 trillion industry to $100 billion industry, with the residential industry being hit most severely, Hauck said.

and has received $1,000 a day since Farmgram was posted on May 25. As of Sunday, the company had raised $5,911 and gained 122 backers. The company’s goal is to get $13,000 by July 1, 2013. “The money will allow us to renovate a van used for delivery, buy reusable canvass boxes and hire somebody to develop our website,” she said. “It’s been so much work outside work. It’s a huge project, but it’s super exciting.” The group thought Farmgram would thrive on Kickstarter because the business idea is community oriented, said Thomas, an architecture senior. The group’s goal was to increase San Luis Obispo County’s access to all the delicious local food grown here, he said. “It is important to eat local food because we live in one of the most agriculturally productive areas in the entire world,” Thomas said. “Why would we eat produce that’s grown across the U.S. when it’s grown in our backyards?” Farmgram will also dedicate a portion of its resources to making local produce more affordable for people with limited food budgets, he said. “Not only will it help the local economy, but I think people will find that local food tastes better and helps them

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Monday, June 3, 2013 “Residential markets saw loses in 60 percent to 70 percent of its annual volume,” he said. Residential construction is close to being out of the market completely, Hauck said. The field is no longer hiring in residential construction anymore. Construction is either civil or commercial. “As I like to put it, in 2008, the rest of the country was in a recession, but construction was in a depression,” Hauck said. Construction management is a large part of the economy, Barlow said. The growth and expansion of the economy

get more creative in what they are eating,” he said. Reconnecting people back to their local farmers is especially important as food systems are becoming globalized, architecture senior Godby said. “People are starting to pay more attention to where food is grown and the whole growing process,” he said. “There is power knowing where your food comes from.” Starting a business while writing senior projects and architecture theses has proven to be intense for the group, but they all share a deep passion for local food systems, he said. And the hard work has gotten a lot of positive feedback online as the group has received several emails asking for Farmgram to start its delivery services in other coun-

depends on its success. With needs for malls, office buildings and transportation, construction management growth patterns will continue to be successful. Even though placement growth is close to 100 percent, some students will have difficulties in being placed within the first six months after graduation, construction management lecturer Elbert Speidel said. “The recruitment program isn’t as vigorous as it used to be,” Speidel said. “We’re trying to change that now. We want students to know we have the

volved with the economy.” The market has changed, Hauck said. “From a student perspective, we went from the hottest job hiring markets, five or six with the highest salary offers and multiple job offers per graduate,” he said. “Where we are right now is back to about 100 percent placement.” The only worry in construction management is if another recession hits, Barlow said. “It’s a continued upswing unless we get back into another recession,” Barlow said. “Our industry needs our graduates.”

COURTESY PHOTOS

From left to right: Tyler Thomas, Tessa Salzman and Adrian Godby started Farmgram to preserve San Luis Obispo’s local food system and to be their own bosses, Salzman said. ties or even countries such as China, Godby said. “There is something about

making the food yourself, there is a quality that enhances it,” he said. “It’s about

being a part of a complete process that changes your outlook on food.”

ADMINISTRATION

improvement and the idea of a comprehensive polytechnic university — they are welcome on his team. In mid-May, the president announced he will create two additional top-level positions for Cal Poly following spring quarter: a vice president for strategic initiatives and a presidential faculty fellow. College of Agriculture, Food and Environmental Sciences Dean David Wehner will take the new vice presi-

dent job for no more than one-and-a-half years, Armstrong said. The president’s chief of staff Betsy Kinsley also announced Armstrong’s choice to name philosophy professor Rachel Fernflores as the first presidential faculty fellow at an Academic Senate executive meeting. Both Wehner and Fernflores will begin during summer.

continued from page 1

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best department and it takes little effort to get that information out.” Hauck spends a lot of his time networking with construction management companies and alumni to get them to come to Cal Poly and offer opportunities for students, Hauck said. “We try to keep the number of companies that are hiring to come here,” Hauck said. “I spend a lot of time on the road networking myself. When the market is bad, I’m out there trying to get more companies to talk to our students. It’s a matter of us trying to stay in-

different opinions than him. At a meeting Thursday with the Cal Poly Public Relations Student Society of America, Armstrong said it’s “even better” when people applying for top jobs at Cal Poly disagree with him. As long as they believe in his four Cal Poly fundamentals — student success, Learn By Doing, continuous

Sean McMinn contributed to this staff report.

MDnews 3

Monday, June 3, 2013

WORD ON THE STREET How are you getting ready for finals?

“Procrastinating a lot. Mostly just going back over old material.” • Austin Hochstetler mechanical engineering sophomore

Lead found in Calif. grocery stores’ candy HEATHER SOMERVILLE San Jose Mercury News

The California attorney general has accused several large grocery stores, including Trader Joe’s and Whole Foods, of selling lead-tainted ginger and plum candies in a case that underscores how little consumers know about the food they eat. The suit also offers a glimpse into the highly complex world of food sourcing and labeling. Even as the movement for more labeling picks up steam, environmentalists and food scientists increasingly are confronted with the reality that our food may always be partly shrouded in mystery. “The fact is that you have a lot of food that you don’t know where it comes from,” Ted Ning, executive director of Lifestyles of Health and Sustainability, a Colorado-based organization

that advocates for environmentally and socially sustainable goods and services, said. The lawsuit, filed April 30 in San Francisco Superior Court, argues that Trader Joe’s, Whole Foods, Target, 99 Ranch Market, Island Pacific Supermarket, Marina Food and other retailers have been selling candy, snacks and bulk food made with ginger or dried plums that contains dangerously high levels of lead. The companies did not alert customers to the lead, the suit charges, and that violates California’s Proposition 65, which requires businesses to warn consumers about harmful toxins in food, toys, jewelry and other products. The retailers have been notified of the lawsuit, and the state is expecting a response in June. Retailers declined to comment on the case, but at least one, Target, has already pulled off its shelves the prod-

COMPANIES NAMED IN SUIT 99 Ranch Market: Red Lantern Plum Candy, Sliced Sweet Ginger, Sweet and Sour Prune, Sweet Fruit Dried Plum, Dried Plum, Dried Seedless Plum, Kan Rose Plum, Preserved Plum Food Market: The Ginger People Baker’s Cut Crystallized Ginger Chips

“I’m not really doing anything for finals. I have a wedding right before, so I’m not going to be studying that much.” • Laura Meert landscape architecture freshman

Island Pacific Supermarket: Dried Salted Prune JFC International: Dynasty Sugar Ginger Kam Lee Yuen: Ginger Candy, Plum Candy, Red Plum Candy Lion Supermarket: Sweet Fruit Ginger, Seedless Plum, Sweet Fruit Sweet Plum, Sweet Fruit Dried Plum Marina Food: Sweet Fruit Ginger, Sweet Fruit Licorice Lemon Ginger Reed’s: Reed’s Crystallized Ginger Target: Archer Farms Crystallized Ginger Trader Joe’s: Uncrystallized Candied Ginger Whole Foods Market: The Ginger People Baker’s Cut Crystallized Ginger Chips, Whole Foods Bulk Ginger

“Study(ing) in the library.”

ucts named in the suit. Lead-tainted food can end up in customers’ shopping carts more easily than they think, said Michael Hansen, senior staff scientist at Consumers Union and a national expert on food safety. He said many retailers get products, particularly those made with ginger, from Asia. Food there is less expensive and often produced in contaminated environments with little oversight, he added. “In China, there is booming agriculture, and even though there are some laws, there’s no enforcement,” he said. “It’s the Wild West.” Many overseas food manufacturers don’t test their food, some retailers don’t ask enough questions about the products they buy, and the U.S. Food and Drug Administration doesn’t provide enough oversight for foods entering the country, Hansen said. Another danger for consumers is that stores have a history of pleading ignorance to food contamination, issuing a recall and an apology only after a problem is discovered, said Charles Margulis, communications director for the Center for Environmental Health, an Oakland, Calif.based advocacy group that initiated the lawsuit. "It’s in any business’s interest to not know about the toxic chemicals that are in their products," he said. "If they simply don’t know about it, there’s no liability for them." However, cases like this may change that. Attorneys and experts say retailers are facing pressure from state authorities to improve food testing standards and force overseas vendors to clean up their growing and packaging practices. "Stores are the ones in the hot seat," said Ann Grimaldi, an attorney with McKenna Long & Aldridge in San Francisco who has defended businesses in similar cases.

Target already has removed the Archer Farms brand candied ginger from stores. “Target is committed to abiding by state and federal laws and regulations, and we expect our vendors to do the same,” company spokeswoman Jessica Deede said. She declined to comment further on the lawsuit. Trader Joe’s, however, continues to sell the Uncrystallized Candied Ginger named in the lawsuit, a spokeswoman said. Whole Foods said it is investigating the issue with suppliers, and customers who purchased the ginger products that are suspected of containing lead can return them for a full refund, spokeswoman Jennifer Marples said. The Center for Environmental Health, which frequently sues businesses suspected of violating Proposition 65, started investigating the candies last year. The organization, the attorney general’s office as well as attorneys representing the retailers each declined to release the results from the lead tests, saying the information was confidential while the case is ongoing. But Lynda Gledhill, the attorney general’s press secretary, said in an interview that each of the products tested contained more lead than the maximum level considered safe in candy, and at least one contained a lead level nearly seven times that limit. Gledhill added that the lead levels were sporadic, “meaning it wasn’t something that was naturally occurring.” The results concerned the attorney general, she said, because ginger candy is especially popular with pregnant women and children. Hansen said any food exceeding the limit set by Proposition 65 poses a danger to children, who often are most vulnerable to the effects of lead exposure. According to the World Health Organization, exposure to some compounds of lead can cause a host of diseases, includ-

LEAD LIMITS • The U.S. Food and Drug Administration’s maximum lead level for candy is 100 parts per billion (ppb). All ginger and plum candies tested by the California Attorney General’s Office exceed this; one candy tested above 650 ppb. • California law sets the maximum level of cancer-causing lead at 15 micrograms per day. For some people, that could equate to approximately five ounces of candy. • State law caps exposure to lead that can cause reproductive harm at no more than 0.5 micrograms per day.

ing cancer, damage to the nervous and reproductive systems and the kidneys, high blood pressure and anemia. Lead exposure is particularly damaging to the developing brains of fetuses and young children, and to pregnant women. However, Grimaldi says the lead levels set by the state are too low and don’t take into account naturally occurring toxins that seep into the ground, where ginger grows. “It’s a root. You’re going to naturally expect there to be chemicals,” she said. “You can literally walk down the street and breathe more lead.” More testing will be done to determine where the lead came from. If food manufacturers can’t reduce or eliminate the lead, they will have the option to print a cautionary label on the package and continue selling in California. Or, stores can pull the products from their shelves and replace them with a different, toxin-free candy.

Violent protests in Istanbul expected to continue

• Hyung-Min Park art and design junior

“Sleeping, getting enough exercise and making sure that I relax too ... do fun things as little breaks.” • Brianna Baker agricultural and environmental plant sciences junior MCCLATCHY-TRIBUNE

Turkish riot police used water cannons and tear gas in an attempt to break up the protest against the demolition of Taksim Gezi Park in Istanbul, Turkey. CARSTEN HOFFMANN McClatchy-Tribune

“Just try to do as much as I can.” • Cristopher Lagmay art and design junior

Turkey’s violent crackdown on protests in Istanbul raised international concern, after opponents of the government were met with tanks, tear gas and water cannon for two days. Tens of thousands of protesters thronged the city’s approximately 1-mile Bosphorus Bridge and made their way toward Taksim Square but were held back by security forces. The protesters, who accuse Prime Minister Recep Tayyip

Erdogan and his Justice and Development Party (AKP) of gradually instituting authoritarian Islamist rule in fiercely secular Turkey, called on him to step down. “The severity with which the police have responded is completely inappropriate and will lead to an expansion of the protests,” European Parliament President Martin Schulz said. His remarks echoed concerns voiced by the office of European Union foreign policy chief Catherine Ashton, as well as the United States and

local human rights groups. A number of people have been injured as police have tried to disperse protesters since Friday, demonstrators said. “Turkey’s long-term stability, security and prosperity is best guaranteed by upholding the fundamental freedoms of expression, assembly and association, which is what it seems these individuals were doing,” U.S. State Department spokeswoman Jen Psaki said. Police surrounded the Besiktas ferry landing in an attempt to arrest potential pro-

testers from the other side of the Bosporus, according to social media accounts. Images posted to Facebook appeared to show a group of police officers beating an unarmed protester and a man with severe lacerations on his back. While initial reports suggested security forces had withdrawn from Taksim Square, protesters said police had resumed firing water cannons and dropped pepper spray from helicopters by Saturday afternoon. There were reports of electricity and internet services

being shut down around the city. Mobile phones were unable to transmit data. Hotels and businesses in central Istanbul supplied demonstrators with food, water and wireless Internet connections. In a televised speech Saturday, a defiant Erdogan said police would bring the Taksim Square protests to an end. He conceded that the use of pepper spray may have been excessive and called for an investigation. Authorities expect the protests to continue.

MDarts 4

Monday, June 3, 2013

‘Come, come Shwayze’s Calistyle concert delayed by Calistyle traffic WORDS: ALLISON MONTROY

amontroy@mustangdaily.net

PHOTOS: DAVID JANG

davidjang1.md@gmail.com

he plaza was glowing from the slowly sinking sun, there were unbuttoned Hawaiian shirts and colorful tribal print skirts everywhere, and just about everyone was smiling and enjoying the warm, late-afternoon air. Summer had clearly arrived, and Shwayze’s performance in the University Union Plaza would be the perfect kickoff for the new season. That is, if he ever got there. The evening started with a good, albeit too long, set from local DJ duo Butterslaps. The heavy bass and solid remixes woke up the crowd, and there was dancing, crowdsurfing and smiles — for a while. An hour later, the sun was down, Butterslaps had run out of songs, all those tank tops and shorts were starting to seem like a bad choice in the chilly air, and people started to wonder if the rapper was going to make an appearance after all. “What a diva,” art and design junior Ellen Williams said about the delay. “So rude.” She had come excited to hear “Corona and Lime,” but didn’t expect to wait an extra hour and a half for it. But, in the meantime, Williams was still smiling and

6.3.13 to

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Monday, June 3, 2013

summertime’ said she people-watched — noting the high number of “drunk freshmen” roaming the plaza. Some audience members speculated that Shwayze’s delay was alcohol or marijuana related, but it turned out, even famous rappers can fall victim to traffic jams. Shwayze and his three-man crew had been “stuck in motherfucking traffic,” he explained to the audience once onstage — and wasted no time to jump right into his first song of the night, joined onstage by a drummer, guitarist and DJ. Finally, the crowd could bounce to Shwayze’s feel-good beats; people sat atop peers’ shoulders or stood on the steps to catch a glimpse of the rapper as the occasional cloud of smoke billowed up through the mass of bodies. Shwayze, decorated in a backwards cap, gold chain around his neck and black shades perched just above his eyes, played a lot of his oldschool songs, but picked the perfect set of tunes to set the summer vibe for the night. “I really like his music,” environmental earth sciences sophomore Nate La Fontaine said. “I’ve been listening to him for a couple years ... he’s really California, beachy and chill.” La Fontaine said Shwayze’s music was the perfect laid-back playlist for beachside living, making him “a cool artist to rep here” — at a university so familiar with the sun, sand and surf lifestyle. Throughout his hour-long set, Shwayze played “Island In The Sun,” “Love is Overrated,” “Buzzin’,” “Rich Girl” and even threw in covers of Red Hot Chilli Peppers’ “Under the Bridge” and Coolio’s “1, 2, 3, 4 (Sumpin’ New).” The crowd favorite, was, of course, his 2008 hit “Corona and Lime.” “It’s a good way to kick off summer,” construction management sophomore Ryan Mahlman said of his favorite Shwayze song. Mid-set, Schwayze stopped to tell the audience: “If I were a vegetable, I’d be a turnip, so turn it up, Cal Poly!” The crowd cheered, happy that Shwayze eventually did “turnip,” just in time for summer.

If I were a vegetable, I’d be a turnip, so turn it up, Cal Poly! — SHWAYZE

MD op/ed 6 MUSTANG DAILY Graphic Arts Building Building 26, Suite 226 California Polytechnic State University San Luis Obispo, CA 93407

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Monday, June 3, 2013

Apple sparks tax reform ideas

MICHAEL HILTZIK

Los Angeles Times

Apple Inc.’s success at avoiding billions of dollars in U.S. taxes through some (apparently) legal maneuvers has tax pundits pointing their guns at the corporate tax system. The case has revived numerous hoary cures for the supposed evil of corporate taxes. The cures include abolishing the corporate tax altogether, turning it into a pure “territorial” system that taxes multinational firms only in proportion to the income generated within the United States, declaring a tax “holiday” allowing businesses to repatriate cash parked overseas (where it is taxed at vanishingly small rates, like Apple’s) at a one-time-only discount. Those are all fantasies. The countervailing realities are these: There are numerous good reasons to have a corporate tax, a territorial system would only encourage more Apple-style shenanigans, and a tax holiday would be an unjustified and ineffective giveaway to undeserving firms. Let’s start with the Apple case. As outlined by the Senate Subcommittee on Investigations, Apple avoided U.S. taxes substantially by such devices as vesting a healthy portion of its intellectual property rights in an Irelandbased affiliate, Apple Operations Inc. (AO), which claimed to account for 30 percent of the company’s total net profits. AO managed to avoid paying tax to any country on those profits by exploiting the cracks between Ireland and U.S. tax rules: Ireland bases tax residency on whether a firm’s management and control resides in Ireland, and the U.S. bases residency on where a company is formed. AO was formed in Ireland, so Apple claims it isn’t subject to U.S. tax; but its management and control are in the U.S., so Apple claims it isn’t subject to Ireland tax. Get the joke? According to testimony before the committee, this maneuver and others saved Apple $7.7 billion in U.S. taxes in 2011 alone. Apple has parked $102 billion of assets and profits offshore to take advantage of tax loopholes, the committee says; this wealth isn’t subject to U.S. tax until it’s repatriated to these shores, which could technically be never. A misconception about this stunt needs to be disposed of upfront, however. Although some corporate tax critics say this shows how U.S. tax law prevents a company from repatriating its earnings for the good of the U.S. economy, the money is not

BASEBALL continued from page 8

FRIDAY: CAL POLY 9, SAN DIEGO 2 All the lights were on Kris Bryant. San Diego’s third baseman entered Friday’s game leading the nation in home runs (31), walks (63), slugging percentage (.860) and runs (78), while ranking third on MLB.com’s top 100 draft picks list. But Cal Poly (40-17) revealed a slugger of its own, as the Mustangs defeated San Diego (35-24) 9-2, thanks to four RBIs from designated hitter Brian Mundell. “Every time (Mundell) is at bat, I think he’s going hit a home run,” starting pitcher Joey Wagman said. “He just has that presence in the box. We know something good is going to happen. He did that a bunch today.” Mundell got things started for Cal Poly in the first inning when he drove a pitch

truly offshore. It rests in accounts at U.S. banks and investment entities, including Apple’s Nevada-based investment fund, Braeburn Holdings, so it actually is deployed widely in the U.S. economy. It’s just withheld from the tax authorities. Moreover, as is pointed out by USC tax expert Edward Kleinbard, a former chief of staff of Congress’s Joint Committee on Taxation, Apple effectively is repatriating $16 billion of this hoard tax-free. It is doing so by borrowing that sum to pay for a stock buyback and taking a write-off from U.S. taxes for the interest on the borrowing. In other words, the company will balance the interest income on its overseas billions with an interest write-off in the U.S., and will distribute it to shareholders via the buyback. Apple is not alone in its chicanery. Estimates of what Kleinbard terms “stateless income” earned by U.S. multinational corporations but untaxed run as high as $1.7 trillion. This has allowed

nal Research Service. The phenomenon supposedly bolsters a common rationale you’ll hear for abolishing the corporate income tax, which is that it distorts corporate decision-making. Firms spend billions cooking up tax-avoidance strategies, and spend billions more by making otherwise inefficient investments largely for tax reasons. Shed corporate managements of this burden, the argument goes, and they’ll be free to deploy their capital sensibly, investing in America and creating jobs in the same atmosphere of cheery amity you’ll find (so I’m told) in the world of My Little Pony. This argument is popular among economists. What it leaves out is that government in the real world

U.S. companies to reduce their effective federal tax rate from the statutory 35 percent to an average of about 29 percent, although some big companies have gotten down to single digits or even zero. Apple’s effective tax rate in 2011, the Senate committee says, may have been as low as 7 percent. Unsurprisingly, about 40 percent of the profits of U.S. multinationals are reported in such countries as Bermuda, Ireland, Luxembourg and Switzerland, where taxes are minuscule or nonexistent for foreign firms, according to the Congressio-

requires revenue. Since all taxation imposes economic distortion in one way or another, the question boils down to how to do that in a fair, sensible and efficient way. Having a corporate income tax probably meets those requirements better than not having one. To begin with, the corporate tax equalizes the tax treatment of all business income. Roughly half of all business income is now earned by non-corporate entities — mostly Scorporations and partnerships — that pass tax liability through to their own-

over the 395-foot center-field wall to give the Mustangs a 1-0 lead. “Being able to get on top first was really important for us,” Mundell said. “It was pretty cool to set the momentum in our favor for the rest of the game.” On the hill, Wagman tossed eight innings, allowed one earned run and set the Cal Poly school record with 13 wins on the season. He kept Bryant at bay all day, allowing the corner infielder to reach base only once, a walk in the third inning, in four at-bats. “He had it all going,” Bryant said. “You don’t see many right handers with a change up. You’ve got to tip your hat.” It remained a pitchers’ duel until the sixth inning, when Cal Poly exploded for a six-run inning off San Diego’s southpaw PJ Conlon, who was undefeated entering Friday. “They’re a tough team to pitch to,” Conlon said. “They’re a good team. They got timely hits. It came together for them.” After left fielder David Armendariz reached on a fielder’s

ers, who pay it on their personal 1040s. Exempting the earnings of big public corporations from taxation would give their shareholders an unfair benefit. Some argue that the answer is to shift the corporate tax onto the owners of big companies, meaning the shareholders, by raising tax rates on capital gains and dividends, which is how corporate profits typically are distributed. There are a few problems with that. For one thing, replacing the roughly $280 billion in revenue brought in by the corporate income tax (the figure is from 2012) would require tripling or even quadrupling the tax rate on dividends and capital gains. As anybody possessing even a passing familiarity with U.S. politics knows, on the gonna-happen scale that’s an ain’t. Adding to the difficulty, Kleinbard notes, the capital gains tax is the only voluntary tax we have — it can be avoided for a lifetime through the expedient of not selling shares; while you live you can borrow against the capital, and when you die the liability is extinguished for your heirs. The revenue return from a sharply hiked tax on capital gains would plummet. So what should we do about loophole jockeys like Apple? The easiest remedy is to abolish the overseas income loophole: impose a single rate on all income earned by U.S. multinationals, with a credit for taxes paid to foreign countries. That would allow Congress to bring the statutory U.S. corporate tax rate down from the current 35 percent to about 25 percent to 28 percent, close to the effective corporate tax rate in other big industrial countries. Some tax experts say that closing the foreign asset loophole would simply provoke U.S. companies to reincorporate overseas. That’s a lot harder than it sounds, however. Congress effectively closed that loophole in 2004 after a surge in foreign reincorporations by companies such as Seagate and Tyco. The new rules made the transactions so expensive for public companies and their shareholders that there hasn’t been an attempt by a major company since then. If closing the foreign-asset loophole were to inspire more to try, you can bet that the inversion rules would be tightened further. No one doubts that the corporate tax system can be improved by making it fairer and more standardized. But in economic terms there’s nothing uniquely burdensome about it. On the contrary, it may be the most efficient way of ensuring that business profits do their part in funding the government that protects their owners’ interests. Don’t buy into the argument that corporations should be exempt; what they don’t pay, you will.

PHOTO COURTESY OF MELISSA LUNDIE

Second baseman Denver Chavez (right) led the Big West Conference in hits this season. choice, catcher Elliot Stewart sent him to third base with a hit-and-run. John Schuknecht walked to load the bases for freshman shortstop Peter Van Gansen, who sparked the RBI parade. Van Gansen walked, Denver Chavez was hit by a pitch and

Mundell added two more RBIs, giving Cal Poly a 9-2 lead. “Occasionally, we have big innings, but not like today,” head coach Larry Lee said. “The majority of our games are tight ballgames. Today was uncharacteristic of a Cal Poly baseball game this year.”

Friday’s victory marked Cal Poly’s first postseason win at the NCAA Division I level. “We were calm and we were ready from the very first pitch,” Lee said. “It was great to come out and play well. Tomorrow is obviously a different ballgame.”

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MDsports 8

Monday, June 3, 2013

YEAR ENDS IN LOS ANGELES

Cal Poly eliminated after losses to UCLA, San Diego INSIDE THE BOX SCORE 5 Matt Imhof pitched five innings of no-hit baseball on Saturday against UCLA.

13 Joey Wagman (left) reached a programrecord 13 wins after he helped defeat San Diego 9-2 on Friday.

PHOTO COURTESY OF MELISSA LUNDIE

Starting pitcher Joey Wagman pitched eight innings in the Mustangs’ first game at the Los Angeles Regional. He gave up one earned run on six hits with three walks and three strikeouts.

SUDOKU ANSWERS

JACOB LAUING J.J. JENKINS

sports@mustangdaily.net

SUNDAY: SAN DIEGO 8, CAL POLY 5 LOS ANGELES — A day after giving up a four-run lead to UCLA, the Cal Poly baseball team was eliminated from the

NCAA tournament on Sunday afternoon by San Diego in a 8-5 loss. The Mustangs were done in by a four-run sixth inning that saw two runners score on basesloaded walks from relief pitcher Michael Holback, giving the Toreros a five-run lead that proved to be insurmountable. Cal Poly defeated San Diego in the opening game of the Los Angeles Regional on Fri-

day after using a six-run sixth inning in a 9-2 victory. The Toreros scored the first run of the game after the nation’s home run leader, Kris Bryant, singled against the Mustangs’ starting pitcher, true freshman Casey Bloomquist, in his first at-bat. Bryant, who is expected to be picked in the first round of the Major League Baseball draft later this month, was brought around to score on a single by first baseman Connor Joe. Cal Poly responded with a run of its own in the top of the second inning, a single by Elliot Stewart that brought Jimmy Allen home. Allen was the Mustangs hottest bat throughout their three postseason games, as he went 8 for 13 with five RBIs. On Sunday, he was 3 for 4 with two RBIs. Holback took the loss for Cal Poly after allowing runners to score in the fifth and sixth innings. The Toreros’ run in the fifth, scored on a passed ball by Stewart, put San Diego ahead 4-3. The Mustangs rallied from down 8-3 in the seventh inning by loading the bases for Allen with two outs. He singled through the right side to score Brian Mundell and Peter Van Gansen, but David Armendariz couldn’t keep the rally alive as he flew out to right field. The top of the Cal Poly lineup went down quietly in the ninth inning, which ended the most successful season in the program’s Division I history. For the first time, the team won 40 games and its first-ever postseason game. It was the second time Cal Poly advanced to the postseason, the only other time being in 2009 when the Mustangs lost back-to-back games in Tempe, Ariz. Following Sunday’s loss, the team will lose seniors Stewart, Joey Wagman, Kyle Brueggemann and the Big West’s hit-leader, Denver

Chavez. Wagman earned a Cal Poly single-season record 13th victory against San Diego on Friday. SATURDAY: UCLA 6, CAL POLY 4 A ball lost in the pale, blue Los Angeles sunset. That was the difference for the Cal Poly baseball team on Saturday night, as a miscue by Nick Torres in right field cost the Mustangs three runs, eventually leading to a 6-4 loss to UCLA in Cal Poly’s second game at the Los Angeles Regional. “Off the bat, I just saw a popup, it didn’t look like he hit it too well,” Torres said. “It wasn’t until the ball got down below the lights until I saw it again. By that time it was just too late.” The Bruins tied the game at four runs apiece in the sixth inning after Torres allowed a two-out fly ball to drop behind him with the bases loaded. UCLA then went on to tack on two more runs in the seventh inning. “(It was a) tough one to swallow,” Cal Poly head coach Larry Lee said. The Mustangs jumped all over UCLA pitcher Nick Vander Tuig in the first inning, as the first two Cal Poly batters reached on back-toback singles. “They jumped on us the first three innings,” UCLA head coach John Savage said. “They mugged us, basically.” Torres drove in the first Cal Poly run with a sacrifice fly and Jimmy Allen plated a second run with a RBI-double down the left-field line. The Cal Poly bats kept the pressure on Vander Tuig, scoring runs in the third and fourth innings, while starting pitcher Matt Imhof cruised through the Bruins batters. He had a no-hitter through five innings before he began tipping his pitches and UCLA

took advantage, he said. The first three Bruins reached in the sixth inning before he forced a sacrifice fly, allowing a run to score. The UCLA batters denied after the game that they knew what pitches were coming. “That would’ve been nice,” UCLA designated hitter Kevin Williams said. Imhof nearly got out of the inning on a double-play ball up the middle in the following at-bat, but second baseman Denver Chavez couldn’t pull the ball out of his glove in time and the bases became loaded again. Lee then elected to pull Imhof in favor of Reed Reilly, traditionally a closer, who struck out the first Bruins batter he faced, then forced a fly ball to Torres in right field. “He came in and did exactly what he was supposed to do,” Lee said. “He got the fly ball and it probably would’ve been a different ballgame (if he made the play).” Torres initially tracked in and appeared to have the pop fly in his sights before turning around and running toward the wall, clearly having lost the ball. “It just got above the lights and I had no idea where it was,” Torres said. Once the Bruins were ahead, adding two runs in the seventh inning, the Mustangs appeared overmatched by the UCLA bullpen, anchored by closer and Pac-12 Pitcher of the Year David Berg. Before Berg took the hill in the ninth and saved his 20th game of the season, the Mustangs had to get through James Kaprielian, a true freshman with a 1.54 ERA in 28 appearances this year. Kaprielian struck out four of the six Mustangs he faced, and didn’t allow a base runner. “Their relievers did a real good job, piecing it together near the end,” Lee said. see BASEBALL, pg. 6