Can't create new directory in home folder: What are "default" permissions/ownership?
The answer was provided by fd0 who posted it on SuperUser. 
The problem turns out to be caused by conflicting ACLs, and was solved by removing them all. (Apparently resetpassword as suggested above did not clear these ACLs.  I don't know why.) The terminal command that revealed the conflicting ACLs was:

ls -ledO@ "/Volumes/Macintosh HD/Users/jbenni"


The terminal command that fixed the conflict (by removing all) was: 

chmod -N "/Volumes/Macintosh HD/Users/jbenni"


I hope this helps someone else. I was chmod aware, but didn't have a working knowledge of ACLs - so I never would have found this on my own. Stackexchange rocks!