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Net Neutrality is About Consumer Welfare not Corporate Welfare for Netflix

Somewhat Reasonable - March 22, 2014, 1:32 AM

Billionaire Netflix CEO Reed Hastings objects to Netflix having to pay anything at all for Netflix’ gorging on 30% of the Internet’s North American bandwidth. In a Netflix corporate blogpost billionaire Reed Hastings rails against the perceived injustice of Netflix paying Internet usage-based pricing like consumers do.

At core, Mr. Hastings now derides traditional consumer-defined net neutrality, which ensures consumers the freedom to access the legal content of their choice – as “weak” net neutrality.

Meanwhile, he is attempting to rebrand his new self-serving, corporate-defined net neutrality, which ensures the largest corporate users of the Internet pay nothing for their largest usage of interconnection bandwidth — as “strong” net neutrality.

Mr. Hastings’ position clearly prioritizes corporate welfare above consumer welfare.

His own words make his upside-down priorities clear:

Strong net neutrality additionally prevents ISPs from charging a toll for interconnection to services like Netflix, YouTube, or Skype, or intermediaries such as Cogent, Akamai or Level 3, to deliver the services and data requested by ISP residential subscribers. Instead, they must provide sufficient access to their network without charge. [Bold emphasis added.]

Simply, Mr. Hastings’ self-serving position here is that large Internet corporations not only should not have to pay for any usage-based Internet interconnection, they should not have to pay anything at all!

Netflix’ position is that users should fund the full cost of the Internet’s infrastructure, while the largest Internet corporations which profit the most from the Internet are entitled to an official special-interest pass on corporate responsibility.

Most simply, Netflix demands that large Internet corporations be entitled to use and profit from the Internet for free, while consumers and ISPs pay their tab.

Anyone who thinks about it appreciates that the Internet operates over very expensive high-tech infrastructure that constantly needs upgrade to handle exploding usage. Someone has to pay for it, it is not free.

Like any other market, Internet users can buy different types of Internet access based on their different needs, wants and means. Specifically, a consumer can buy the speed and mobility they want and the amount of usage they want to consume. And like any other rational economic market, those that use more, pay more.

Give Mr. Hastings credit where credit is due, he has a lot of gall. His concept of “strong” net neutrality is that the corporation that uses the most Internet bandwidth, his, with a whopping 30%, should pay the least.

Moreover, under Mr. Hastings “strong” net neutrality vision, corporations may charge consumers for their Internet usage, but may not charge other corporations for their usage. Here Mr. Hastings employs self-serving, pejorative terms like “toll” and “arbitrary tax” to distract people from the fact that what we are really talking about here is simply a price for value received.

Notice how Mr. Hastings’ priority for “strong” net neutrality effectively abandons the consumer?

It will be telling to see if any consumer groups support Netflix’s anti-consumer position. And if some do it will be telling how they square that circle with their consumer clients.

In sum, this whole issue is actually very simple. For two decades of exponential growth, the Internet backbone market has flourished spectacularly without government regulation.

Internet backbone interconnection pricing is largely based on volume of exchanged traffic (usage) by ISPs, the largest Internet companies and intermediaries. Consumers, both individuals and businesses, also pay for their Internet based on usage. Why now should Netflix and other big Internet corporations be granted a regulatory special exemption from Internet usage pricing at the expense of consumers and other businesses?

Consumers know the old adage — you get what you pay for. Somehow Netflix imagines it is owed whatever they want — and it does not have to pay anything for it.

Simply, Netflix is putting corporate welfare above consumer welfare.


Netflix Research Series

Part 1:  Level 3 & Net Neutrality – Ignorance Unleashed! [11-30-10]

Part 2:  Level 3-Netflix Expose their Hidden Agenda [12-3-10]

Part 3:  Sinking Level 3 Seeking FCC Internet Regulation Bailout [12-8-10]

Part 4:  Netflix’ Open Internet Entitlement Hubris [2-1-11]

Part 5:  Fact-Checking Netflix’ Net Neutrality WSJ Op-ed [7-8-11]

Part 6:  Netflix’ Glass House Temper Tantrum Over Broadband Usage Fees [7-26-11]

Part 7:  Netflix Crushes its Own Momentum [9-20-11]

Part 8:  Netflix the Unpredictable [10-10-11]

Part 9:  Is Netflix the AOL of Web Streaming? [3-9-12]

Part 10: Netflix’ Net Neutrality Corporate Welfare Plan [5-9-12]

Part 11: 5 BIG Implications from Court Signals on Net Neutrality – A Special Report [9-13-13]

Part 12: Video: Why FCC Title II Reclassification of Broadband is a Legal Non-Starter [9-22-13]

Part 13:  Is Net Neutrality Trying to Mutate into an Economic Entitlement? [1-12-14]

Part 14:  Exposing Netflix’ Extraordinary Net Neutrality Arbitrage [1-24-14]

[First posted at the Precursor Blog.]

Categories: On the Blog

Report: Three Hours of Waterboarding Over Fracking on The Daily Show

Somewhat Reasonable - March 22, 2014, 1:03 AM

On Thursday, February 27, I received an email inviting me to be part of a segment “The Daily Show” with Jon Stewart was doing on fracking. After doing my research, I agreed to participate and flew to New York City for a March 7 taping.

I expected that they’d try to spring something on me. Based on the pre-taping interviews, I had a sense of where the interview would go. I studied up as if I was heading in for a final exam. I wanted to be sure they couldn’t trip me up.

When I walked into The Daily Show offices, I felt that I was ready.

The interview started straight enough. They asked: “Why do environmentalists hate fracking?” I explained that I didn’t think it was really about fracking, as thousands, if not millions, of wells had been drilled using hydraulic fracturing since modern techniques were developed in 1949. I pointed out that a primitive form of fracking was done in the late 1800s when a nitro glycerin torpedo was dropped down a well hole. Despite this long, safe, and prosperous history the frack attacks had started in October 2007 — shortly after the technologies of hydraulic fracturing and horizontal drilling were successfully combined and began to unleash America’s new energy abundance.

I continued: It is not really about fracking. It is about fossil fuels — and hating them. The average person doesn’t have a clear understanding of the role that energy plays in their lives (which is why I do what I do). All most people know about energy is the price of gasoline and they know “drill, baby, drill.” They know that increased production of oil translates to lower prices at the pump. So the anti-fossil fuel crowd can’t come out with an anti-drilling campaign, but they can use a term that sounds scary and that people do not understand: fracking — the vernacular for hydraulic fracturing.

Because people do not know what fracking is, the antis can give it whatever definition they want and use fear, uncertainty, and doubt to turn people against the proven technology that is almost singly responsible for creating millions of jobs in America and bringing us closer to energy independence than previously ever thought possible. In a recent Fracking by the Numbers report, on page 6, Environment America offers a definition that basically covers the entire drilling process from permitting to production, including: “to deliver the gas or oil produced from that well to market.”

Once they had scared people, those against fracking set out to stop the procedure—with the ultimate goal of banning it all together. Since 96-98% of all oil-and-gas wells drilled in the U.S. today are stimulated using hydraulic fracturing, banning fracking essentially bans modern oil-and-gas production.

I was asked about fracking accidents. I asserted that there were none that I was aware of and cited the fact that three leading Obama Administration secretaries — hardly fossil-fuel fans — had declared fracking to be safe: former Secretary of Energy Steven Chu, former Secretary of the Interior Ken Salazar, and current Secretary of Energy Ernest Moniz.

Now, in hour three of what I told the crew was like three hours of waterboarding where they kept throwing stuff at me in hopes I’d give something up, the tone changed. Suddenly, the correspondent repeatedly asked me about pizza and whether it was appropriate compensation for a “fraccident.” I stopped and told them: “I will not say that word.” Since I was not aware of any fracking accidents, I wasn’t going to let them get me on camera saying “fraccident.”

Once I was back at home and at my desk, I did a search on drilling, accident, and pizza. The story came up — but it wasn’t a “fraccident.” While the exact cause of the Greene County, PA well fire is still under investigation, the local news reported:

Chevron had previously completed drilling and hydraulically fracturing, or fracking, the well and was in the final stages of using steel pipe to hook it up to a pipeline distribution network for production.

The Pennsylvania Department of Environmental Protection’s Scott Perry stated:

The problem may have come from a defect in the wellhead itself. Chevron’s wellheads are ringed with collars that have set pins running horizontally through them.

Perry says one of the pins may have blown out of the collar, releasing the gas.

The accident referenced by The Daily Show, took place in a rural area and no homes were ever endangered. But Chevron realized that the increased truck traffic and other activities inconvenienced the folks of Bobtown, a place on the Pennsylvania/West Virginia border with a population of 747 people. In an effort to be a “good partner” in the community, Chevron offered vouchers to the only eatery within 80 miles.

While the locals aren’t upset with Chevron for the gesture, saying, “the whole issue was blown out of proportion,” comedians have had a field day with it and the anti-fossil fuel crowd is using it for messaging. A petition has been started at MoveOn.org demanding that Chevron apologize for the free pizza — calling it “an insult.” There are currently nearly 13,000 signatures, mostly from distant locales, but none from Bobtown. Local resident Gloria Garnek commented on the contrived controversy and the coupons saying: “I think it’s a nice thing.”

I’ll have to wait to see how The Daily Show turns three hours of media waterboarding into a 3 – 5 minute segment when it airs in late March or early April.

[Originally posted at Townhall.]

Categories: On the Blog

No Fundamental Shift to Transit: Not Even a Shift

Somewhat Reasonable - March 21, 2014, 9:44 AM

The American Public Transportation Association (APTA) is out  with news of higher transit ridership. APTA President and CEO Michael  Melaniphy characterizes the new figures as indicating “a fundamental  shift going on in the way we move about our communities.” Others even characterized  the results as indicating “shifting consumer preferences.” The data shows  either view to be an exaggeration.

1935 and 2013

This is hardly a reliable time for making judgments about  fundamental shifts or shifts in consumer preferences. Economic performance has  been more abysmally abnormal only once in the last century –during the Great  Depression – than at present.

The last year, 2013, is the sixth year in a row that total  employment, as reported by the Bureau of Labor Statistics was below the peak  year of 2007 (Figure 1). This run of dismal job creation was exceeded only between  the Great Depression years of 1929 and 1936 in the last 100 years (Note 1). From  World War II until the Great Recession, the maximum number of years that  employment fell below a previous peak was two, following the 9/11 terrorist  attacks (2001 to 2003). The Great Recession may have ended, according to the  National Bureau of Economic Research, but the Great Malaise continues as the  economy is performing well below historic levels. Judgments about fundamental shifts and consumer choice today are not more reliable than they would have been in the Great Depression year of 1935.

Transit’s Market  Share: Stuck in Neutral

But more importantly, there is no shift to transit.  APTA is right to point out that transit  ridership has grown faster than vehicle travel in the United States since 1995.  Nonetheless, transit’s share of urban travel has barely budged, because its 1995  share of travel was so small. This is indicated by Figure 2, which compares the  overall market share of transit to that of cars and light trucks from 1995 to  2013. Indeed, the top of Figure 2 (the 100 percent line) is virtually  indistinguishable from the personal vehicle share over the entire period. The bottom  of the chart (the zero percent line) is virtually indistinguishable from the  transit share. This is not the stuff of fundamental shift.

Commuting: The Story  is Not Transit

A similar pattern of little or no change is indicated by the  commuting (work access) data from the Census Bureau’s American Community  Survey.

Over the past five years, as with virtually all the years  since such data has been collected, the overwhelming majority of new commuters  have driven alone (Figure 3). Indeed, transit has not taken a single net  automobile off the road since 1960, and not in the last five years. Between  2007 and 2012, 93 percent of the additional commuters drove alone (Note 2). The  drive alone market, which might have been thought to be saturated, actually rose  from 76.1 percent to a 76.3 percent market between 2007 and 2012.

The biggest change has been the continuing loss in carpool  use, which dropped from 10.4 percent to 9.7 percent from 2007 to 2012. It is  estimated that nearly 450,000 passengers left carpools (excluding drivers),  approximately 1.8 passengers for each additional commuter using transit  (250,000).

The largest gain from 2007 to 2012 was in working at home,  including telecommuting. Working at home increased from 4.1 percent to 4.4  percent. In actual numbers, working at home added 1.9 times the increase in  transit commuting. Its change in market share was greater than that of transit  in 42 of the 52 major metropolitan areas. Surprisingly, this includes New York,  with its incomparable transit system (by US standards).

Transit’s share of commuting inched up only 0.1 percentage  points between 2007 and 2012. This is so small that if this rate of annual  increase were sustained for 50 years, transit’s commute market share would  edge up to only 6 percent (Figure 4),  approximately transit’s 1980 market share (doubling to 10 percent would require  130 years). The latest data indicates both gains and losses for transit, with  market shares up in 28 major metropolitan areas and down in 24.

Transit Losses

In Atlanta, with the nation’s second largest Metro (subway)  system built since 1975, a declining overall employment base was accompanied by  a loss of 13,000 transit commuters, at the same time that there was an increase  in working at home of 19,000.

In Portland,  considered by many around the world to be an urban planning Utopia, the data is  hardly favorable. Since 1980, the last year with data before the first of five light rail lines and one commuter rail line opened, transit’s market share has  dropped from 8.4 percent to 6.0 percent. While spending billions of dollars on  rail, working at home – which involves little or no public expenditure – increased  by triple the number of people drawn to transit. And things have not changed  materially, even during the claimed “fundamental shift.” In the last  five years, the working at home increase is more than double that of transit.

In Los Angeles, ridership at the largest transit agency continues  to languish below its 1985 peak, despite having opened 9 light rail, Metro, and  rapid busway lines and adding more than 1.5 million residents. Even this decline  may be under-stated because of how transit counts passengers. Each time someone  steps on a transit vehicle, they are counted (as a boarding). A person who  transfers between two or three buses to make a trip counts as two or three  boardings, which is what the APTA data reports.

When rail is added to a transit system, bus services are  reconfigured to serve the rail system. This can mean many more boardings from  transfers without more passenger trips. This potential inflation of ridership  is likely to have occurred not only in Los Angeles, but in all metropolitan  areas that added rail systems.

Transit Gains

At the same time, gains are being made in some metropolitan  areas. Ridership has risen more strongly in transit’s  six “legacy cities,” the municipalities (not metropolitan areas)  of New York, Chicago, Philadelphia, San Francisco, Boston, and Washington. Between  2007 and 2012, 68 percent of the additional transit commuting occurred to  employment locations in these six municipalities. This is higher than the 55  percent of national transit commuting that these areas represented in 2012. The  much larger share being attracted by these areas in the last 5 years is an  indication that transit ridership, already highly concentrated in just a few  places, is becoming even more concentrated.  Further, 50 percent to 75  percent of commuters to the corresponding six downtowns reach work by  transit.

Rational Consumer  Behavior

Even when the nation finally emerges from the Great Malaise,  only vain hope will be able to conceive of a large scale consumer preference driven  shift toward transit. The rational consumer will not choose transit that is  slower or less convenient than the car. Where transit access is impractical or impossible,  people will use cars. This is the case for most trips in all US metropolitan  area, as the Brookings Institution research cited below indicates

The  Brookings Institution research indicated that the average employee in the  nation’s major metropolitan areas are able to access fewer than 10 percent of  jobs in 45 minutes. This is not only a small number of jobs, but it is a travel  time that is approximately twice that of the average employee in the United  States (most of whom travel by car).

More funding for transit cannot solve this problem. The kind  of automobile competitive transit system needed to provide rational consumer  choice between cars and transit would require annual expenditures rivaling the  total personal income in the metropolitan area, as Jean-Claude Ziv and I showed  in our 2007 11th World  Conference on Transport Research paper (2007). It is no wonder that not a  single comprehensive automobile competitive transit system exists or has been  seriously proposed in any major US or Western European metropolitan area (Note  3).  Transit is about the largest  downtowns and the largest urban cores.

Unbalanced Coverage

All of this appears to have escaped many media outlets, which largely parroted the APTA press release. For example, The New York Times, CBS  News, the Washington Post, and the Chicago Tribune were as parish  newsletters commenting on a homily by the priest, for their failure to report  both sides. A notable exception was USA Today, whose reporter consulted  outsider Alan Pisarski (who has written for newgeography.com). Pisarski placed  the APTA figures in historical context and expressed reservations about  restoration of the transit commuting share numbers of 1980 or before.


Note 1: Current Employment Statistics Survey data, 1939 to  2013. 1913 to 1938 estimated from data in Historical  Statistics of the United States: Bicentennial Edition.

Note 2: The source for the commuting data is the American  Community Survey of the Census Bureau, which indicates an employment level in  2012 that is higher than in 2007. The Current Employment Statistics Survey of  the Bureau of Labor Statistics indicates a decline.

Note 3: I would be pleased to be corrected on this. In 2004,  we issued a challenge on this subject, and while there were some responses,  none met the required criteria (see http://demographia.com/db-challenge-choice.htm).  The criteria are repeated below:

To identify an actual system or  propose a system that provides the following in an urban area of more than  1,000,000 population:

· Transit choice (automobile  competitive public transport service) for at least 90 percent of trips and  passenger kilometers in the particular urban area.

· Automobile competitiveness is  defined as door to door trip times no more than 1.5 times automobile travel  time.

The description of any system not  already in operation should also include an estimate of its cost, capital and  annual operating.


[Originally published at New Geography]

Categories: On the Blog

Am I an ‘Enemy of the People’?

Somewhat Reasonable - March 21, 2014, 7:54 AM

Years ago, I read Henrik Ibsen’s book about a scientist taking a stand against an entire town when he discovers the town’s medicinal spa is polluted.

The most ironic thing about this is that both sides of the climate debate can claim to be the hero against the villainous other side. While I have never thought of it that way (I have always thought of this as an issue I am acquainted with because of my use of climate as a tool for my forecasting), it seems that with books written about climate “wars” and people being on the front lines of such a thing, one can easily cast themselves as some type of hero struggling against evil, even if that evil consists of fictional strawmen or is personified by blaming someone who has the good fortune to be successful in their pursuits.

But given the recent demonizing, most vividly demonstrated by the call for jailing of man-made global warming skeptics by Lawrence Torcello, a Rochester Institute of Technology assistant professor of philosophy, one has to wonder if there is an effort to silence people similar to other examples we have seen in the past. This article goes into detail about a similar situation where bending science to a political agenda in the time of Stalin resulted in much misery. Rather than me demonizing this, you can read the examples that the author and many others alarmed by this have, including some pertinent history of such practices.

Several years ago, I was asked by a major college wrestling coach if I was afraid of harm to myself and my family because of the stance I took on the matter of what was then global warming. Up until about 2005, I never really gave the whole debate that much thought. It seemed so far fetched to me, that I did not think it a serious threat to our nation, or for that matter, anyone that spoke up against it being in danger. But after the hurricane season of 2005, and what I viewed as a spinning of the weather in a fashion that defied known facts, I started to speak up, simply because of what I knew to be true based on the many years I used those facts to become successful to some degree in what I do. But given the question this person posed to me in 2008 and how tough I knew this person was, I was not alarmed, but bewildered. After all, are we not all Americans? Aren’t tolerance and liberalism (as in freedom) bedrocks of the foundation of our nation? And how could one of the toughest people I ever saw on a wrestling mat – a sport that to me defines what an individual can do when they focus hard work, talent and the freedom to excel – ask me if I was afraid?

Well here we are six years or so later. I see that the coach of this team still has his team up there (the NCAA’s are this week) and his kids are tough and worthy enough to challenge the dynasty that the team I wrestled for in the 1970s, Penn. State, has become (no thanks to me). But on the wrestling mat, things are settled in competition, not with the elimination of competition. Imagine if we simply just crowned a champion because of what people thought. I have been asked that question – am I afraid? –many times since 2008, and every time I respond that, after wrestling a guy that weighed 305 lbs at a bodyweight of 170, why should I be afraid of a scientific debate?

The answer is, I should not be if it’s just about science, or this was the America I grew up in. But given what I see going on today, and the fact this may no longer be a debate about science, and people can threaten, bully, and intimidate like this, perhaps I should at least be wary.

After all, no one wants to be an “Enemy of the People.”

[First published at the Patriot Post.]

Categories: On the Blog

Minimum Wage: A Flawed Way to Fight Poverty

Somewhat Reasonable - March 20, 2014, 11:05 AM

The editorial board of the New York Times had it right 27 years ago when it wrote, “The Right Minimum Wage:  $0.00.” There’s a virtual consensus among economists that the minimum wage is an idea whose time has passed.   Raising the legal minimum price of labor will result in an increase in unemployment and it will be the least skilled workers, those most in need of work, who will be the first to lose jobs and the last to be hired.  That would be the tragic unintended consequences if government forces the new law upon businesses.

The increasingly liberal New York Times editorial “The Case for a Higher Minimum Wage” (February 9) stated:

“Concerning the estimated 27.8 million low-wage workers, the 2014 Times Editorial Board is all for the Democrat proposal of lifting the hourly minimum from $7.25 today to $10.10 by 2016, even questioning the modest rise in benefits to only $10.10.”

A senior citizen friend recently brought to my attention a Wall Street Journal Letter to the Editor submitted by Mr. Robert Scott.  It too conveyed the same line of thinking as the Times Editorial board stated decades ago:

“If the minimum wage is raised to $10 dollars an hour all workers now earning that amount will ask for an increase as well, because their productivity is worth more than the minimum wage workers.  So costs will rise for every worker.”

According to my friend, during the 30′s, before the enactment of minimum wage laws, prices remained relatively constant.  It was possible to plan ahead knowing that the cost of living would remain stable from one year to the next. There was a consistency and thus comfort for people as they realized expenses would not rise.  This was not so when a minimum wage was enacted.

It was 1938 when Congress created the minimum wage during FDR’s “New Deal” under the “Fair Labor Standards Act of 1938.  The act banned oppressive child labor and set the minimum hourly wage at 25 cents and the maximum workweek at 44 hours (25 cents equals $4.13 in 2014 dollars).   Have workers really been better off?

President Lyndon Banes Johnson, in fighting his War on Poverty, changed the way people were paid with his emphasis on income equality.  As Johnson said in his State of the Union speech on Jan. 8, 1964:

“It’s time to acknowledge that to win the War on Poverty, we must wage a battle against income inequality.”

The same friend remembers that before Johnson, individuals who did good and productive work were given a raise.  Individuals competed to be the best.  What President Johnson said is that “all raises should be across the board.  In other words, if one person is given a raise ALL PEOPLE AT THAT LEVEL MUST RECEIVE THE RAISE prompting a huge cost for the factory.  So today there are rallies (such as the one demanding a higher minimum raise) because others are then hopeful of reaping a similar increase in pay if the hike is granted.

To counter those on the left who argue that raising the minimum wage to $10.10 an hours would not cause increased unemployment, consider the rate of unemployment in those European countries where there is no minimum wage.  In countries with a minimum wage, the median unemployment is 11.1%.  In countries without one, it’s just 5.2%.  View the two charts on Minimum Wage for a better understanding of this fact.

An Issue Brief published by The Heritage Foundation on January 21, 2014 informs how most minimum wage jobs lead to better-paying opportunities.  Within a year, two-thirds of minimum-wage workers make more than the minimum, either earning a promotion at their job or accepting a higher paying one.

Yet another Issue Brief published by the Heritage Foundation on January 30, 2013 lays out the facts about Minimum Wage.  Basic studies indicate raising the minimum wage does not reduce poverty, but instead harms the very people they are meant to help.

Would minimum wage workers really be better off with a hike increase if Democrats and President Obama get their way?  As salaries rise across the board, the increased salary cost is tagged on to the product being produced, resulting in the product costing more, which then eats up the extra money individuals have in their pockets to spend when purchasing goods.  Fewer sales equate to fewer jobs opportunities as well as a loss of jobs. More interesting consequences.

Minimum wage jobs are often “entry” jobs in which the employee learns basic skills and work ethics.  There are costs the employer must absorb through that training process, as experienced employees’ time must be used to help train and inevitable mistakes by the trainee can be costly to the employer.  Those entry jobs can be part time and given to teenagers, college students, those in which English is their second language, and some who simply need a place to start their work careers and gain work experience before reaching up to another level.   Raising the minimum wage could put those jobs in a pay category that would attract experienced workers and thus limit the opportunities of people needing those entrance positions.  Thus, we see another unintended consequence and realize the importance of thoroughly examining the issue.

In order to increase buying power, one must increase productivity, but that calls for another article.

The idea of using a minimum wage to overcome poverty is old, and while intended to be honorable — in practice it is fundamentally flawed.  It is time to put this hoary debate behind us, and find a better way to improve the lives of people who work very hard for very little.  The idea of using a minimum wage to overcome poverty is old, and while honorable — it is also fundamentally flawed.

Can we all agree that the practice of Conscious Capitalism, investing in people, while building a business is a worthwhile pursuit in which owners and workers at every level prevail and are ultimately winners.


[Originally published at Illinois Review]

Categories: On the Blog

Ezra Klein’s Misleading Explainer on the Individual Mandate

Somewhat Reasonable - March 20, 2014, 9:31 AM

Ezra Klein recently released a 2-minute clip explaining the need for individual mandates under Obamacare. Man, does that guy talk fast!

Mr. Klein gets most of his explanation about right, with one big exception. He says that a family making $80,000 a year will (eventually) be penalized $2,000 for failing to buy coverage — “less money than health insurance will usually cost you, but you don’t get anything for that money,” he says. Uh, that’s understating things quite a bit. A family insurance policy costs $16,351 according to the most recent employer benefits survey from the Kaiser Family Foundation.

So, right off the bat Mr. Klein’s explanation fails. He is asserting that of course the mandate will be effective since people will have to pay more or less the same whether they’re insured or not, so they might as well get covered and get some value for the money.

That might be true except for two things. A family that does not get covered will save $14,351 to use for other things. That is a whole lot of money for most people. Plus, even the $2,000 penalty will be impossible to collect. It can be collected only through seizing a family’s tax refund. It is easy enough to avoid having a refund if the family adjusts its withholding at the start of the year so it doesn’t overpay its taxes.

But Mr. Klein is correct that it is impossible to have community rating and guaranteed issue in a voluntary market. We have seen how that works in New Jersey, New York and several other states that have tried it. It is a disaster.

In theory this sort of policy can work only if people are required to buy coverage. Otherwise healthier people will wait until they are sick to get covered, leaving only the sicker people in the pool and raising costs even more. This is the famous “death spiral” everybody talks about.

But the analysis can’t just stop there. (This is a common problem with Progressives. They fail to ask the “then what?” questions).  Once a mandate goes into effect, what happens then?

First, as we indicated above mandates are impossible to enforce. It isn’t just in health insurance. Auto insurance is mandated in almost every state, but the rate of non-compliance is about 14 percent nationally and in many states the rate of non-insurance for auto (which is mandated) is even higher than for health (which is not). Similarly, with other mandates — child support, helmet laws, seat belt laws, even taxes. Non-compliance is always about 15 percent, even when there are severe penalties such as jail time for violation.

Second, requiring healthy people to buy and pay the same as sick people for coverage simply isn’t fair. As Mr. Klein himself says in his video, sick people value coverage more than healthy people do and are willing to pay more for it. They do not feel they are disadvantaged by paying more, they are happy to have it. Sure, we would all like to pay less for the things we want, but very few of us want to pay more for things we do not value.

Third, a mandated, community-rated system will fail to deliver the right services to the right people. Private insurers will be highly incentivized to load up on the benefits that attract the healthy people (preventive care, birth control pills) and skimp on benefits for the very expensive people (like cancer treatment). And it isn’t just private insurers that have these incentives. Public programs do, too. There are a whole lot more healthy voters than sick ones, so maintaining political support means providing more benefits to the healthy.

We already see this in Obamacare, with oodles of requirements to cover preventive services but very thin networks for cardiac care or cancer centers. It isn’t much value to the sick people to pay the same as healthy people if they can’t get the services they need. They would much rather pay more and actually get treated for their condition — but that isn’t an option under Obamacare.

Mr. Klein wraps up his argument by saying that it worked in Massachusetts. Maybe, but Massachusetts is not like anywhere else in the United States. Health care costs there are 36% higher than the national average, and that state had only 9.5 percent of its population uninsured before the mandate went into effect. Now it has come down to about 5 percent. Many of the previously uninsured likely hopped across the borders to Connecticut and New Hampshire (just an hour’s drive from Boston). Plus, the waiting times to see a doctor in Boston is about double that of any other major city in the United States (see here).

California, to take one big example, is nothing at all like that. California has 21% uninsured and half the number of doctors as Massachusetts. And it has no nearby New Hampshire to receive those people who choose to remain uninsured.

Finally, Mr. Klein’s arguments are being undermined by the Obama Administration’s daily decisions to delay the effects of this law. They don’t want to face the political heat of actually enforcing it on people — something Mr. Klein doesn’t have to worry about.

[Originally published at The Federalist]
Categories: On the Blog

Perils in the Air: A Frequent Flyer Physician Reflects on Flight MH 370

Somewhat Reasonable - March 20, 2014, 9:02 AM

The bizarre disappearance of Malaysian Airlines flight MH370 might sound like an episode from the Twilight Zone, when an aircraft vanishes into a different dimension and emerges in an earlier time.

But of course the airplane is somewhere on earth, intact or in pieces, and we have evidence that it was in flight for hours-under the control of somebody who evidently knew a lot about it.

Air transportation is a wonderful boon, and many of us have to fly to be able to do our jobs. Engineers, weather forecasters, pilots, air traffic controllers, and many others have made flight very safe, but perils remain. Is there anything we as passengers can do to help ourselves?

Airplanes remain an attractive target for people who don’t mind killing innocent people (“collateral damage”) to achieve an agenda. They might want to cause terror, to wreak revenge, to kidnap hostages, or to assassinate someone. Jihadists might see merit in simply killing infidels. MH 370 raises additional possibilities: stealing the airplane itself for future use, capturing a contingent of experts needed to develop military technology, or perhaps simply creating a diversion at a time of crisis as in Ukraine.

The TSA does not make us perfectly safe. I don’t care much about being x-rayed and patted down, but it is not much more helpful than the old, discarded “security” question about whether I packed my own bag. The U.S. could learn from the Israelis and focus on behavior and likely terrorists.

Passengers need not be burdened by fear of the political correctness police. They can observe the people in the boarding area. Are people making unusual demands of gate personnel, as on 9/11? Do they look out of place, or unusually nervous? You could ask a few polite questions: “Excuse me, sir, are you taking this flight? Where are you planning to stay tonight?” If you don’t like the reaction, you don’t have to board the flight. Many of us, unfortunately, are more afraid of looking stupid than of real threats.

Is there someone on your flight who is a serious threat to powerful interests? When the plane carrying Homi Bhabha, father of the Indian nuclear program, ran into Mont Blanc in 1966, it might have been an accident-or an assassination. In 2011, there were calls for re-opening the investigation of the 1961 crash that took the life of UN Secretary General Dag Hammarskjold. Was his plane shot down? Was KAL 007 deliberately diverted into Russian airspace in 1983 because of Congressman Larry MacDonald? If you have any choice, fly with ordinary folk.

If the goal is to seize the airplane, MH 370 suggests an efficient way to prevent passengers from interfering or from sending a message by satellite phone or Wi-Fi if they notice the plane turning off course.

Flyers may not realize it, but they are sitting comfortably in a pressure chamber. That’s why there’s a little hole in the window-it allows the pressure of the air between the two panes of glass to equalize with cabin pressure.

Only the windows and a thin shell of aluminum are between the passengers and the lethal conditions in the atmosphere at cruising altitude. The cabin must be pressurized to about 8,000-10,000 feet (10-11 psi). Even at that altitude, people with serious heart or lung conditions may not be able to get enough oxygen into their blood.

In the safety briefing, passengers are told to put their oxygen mask on immediately if it drops down, before trying to assist others. That’s because the time of useful consciousness (TUC) may be measured in seconds. At 40,000 feet (2.7 psi), that would be 15 to 20 seconds.

A rapid decompression is lethal for other reasons, being comparable to bolting for the surface from a deep dive: ruptured eardrums, bubbles blocking circulation, exploded lungs. But with a controlled rate of decompression, the bad guys could do just fine with oxygen, while everyone else lost consciousness and quietly died.

Who is piloting your aircraft? Who has control of its life support and communications systems? In a time of total war, it matters.


[Originally posted at The Christian Post]
Categories: On the Blog

Individual Self-Determination vs. Ukrainian or Russian Nationalism (Part 1)

Somewhat Reasonable - March 19, 2014, 11:26 AM

The Ukrainian-Russian crisis over the de facto occupation of Crimea by Russian military forces, which has enveloped the concerns and fears of the world over the last several weeks, revolves around two conflicting claims of national self-determination. It has, once again, brought with it the danger of war on the European continent.

What is this conflict about? It concerns the issue of how it will be decided under what political authority people will live.

Americans do not easily understand the anger and fear this issue has for many in Europe and other parts of the world, and why it can result in such potential or actual violent conflict.

The American Philosophy of Individualism

The American political system was based on a philosophy of individualism. That is, each individual is recognized as possessing certain inalienable rights to his life, liberty, and honestly acquired property. The individual is not the property of an absolute monarch or an arbitrary majority.

Under the traditional American system, virtually every area of human life was viewed as the private affairs of the individual who had that inalienable right to guide and design his life according to his own values, beliefs, and purposes. Interpersonal relationships in society were formed, took shape and changed over time based on the voluntary and mutually beneficial associations and exchanges into which people freely entered.

In the social arena this individualistic philosophy implied that people should be judged as individuals, and not on the basis of such “accidents of birth” as language, religion, ethnicity or race. Of course, and unfortunately, people in their social interactions with others have not always consistently practiced this ideal. Americans, in their private life, too frequently have judged others and acted on the basis of racial, religious, linguistic or other group prejudices.

However, where such racial prejudice was still legally imposed as in the southern states until the 1960s in the form of segregation laws, it was recognized by more and more Americans to be inconsistent with and an offense against the founding principles of the country, and which could not stand in the long run.

Private prejudices and discriminatory acts on the basis of race, religion or language surely might be morally reprehensible but were a part of an individual’s freedom to decide with whom to associate. However, such discrimination was not supposed to be brought into the arena of governmental social or economic policy since this was considered to be violations of individuals’ rights by using the power of the state to harm them on the basis of a collective classification of their identity.

Americans also have been a highly mobile people. From colonial times, Americans always have been open to “moving on.” That nineteenth century phrase attributed to Horace Greeley, “Go west young man,” has been the cultural motto of the nation. Immigrants came from faraway countries and spread across the continent, as did every generation of the native-born Americans.

While the continent has been “conquered” and settled long ago, Americans still pick themselves up and change in what part of the country they live and work far more readily and frequently than most Europeans do in their own part of the world.

The lowering of the migration barriers within the European Union is changing this, especially among the younger generation of Europeans, but it is still, in general, less than among Americans. People in Europe, due to their relatively greater immobility, have traditionally felt a stronger “connectedness” to a specific and local geographical area.

Europe’s Philosophy of Collectivism

Europe’s history is grounded in a philosophy of collectivism, the idea that the group comes before the individual and that his identity and sense of meaning and purpose is tied to the particular “tribe” into which he has been born.

One of the most powerful modern variations on this collectivist theme has been nationalism. Before the demise of monarchism in the late eighteenth and early nineteenth centuries, the individual owed his allegiance to the king or emperor who claimed to own and rule over all and everything with absolute authority in his domain, and usually by asserted “divine right.”

But with the coming of the French Revolution in 1789, all this began to change. With the end of monarchy, the issue arose, “If not to the king, to whom does the individual owe allegiance?” It was declared that within the boundaries of what had been the territory of the former king, the new ruler was “the people” themselves. The “nation” was the new collective to which the individual owed his allegiance and for which he should expect to sacrifice himself if the good of “the nation” required it.

Nationalism and Collectivist Identity

But what defined a “nation” or a “people” as one collective group versus another? Some of the advocates and propagandists of the new nationalist ideal of human identity spoke of a common culture or set of traditions extending over many generations that shaped and made the individual’s sense of who he was and to whom he was connected.

Others spoke of language or race as the unifying determinate of what bound a people together as “one” in terms of national belonging and common destiny. The structure of language and the meanings of words shape how a group of people think and reason, it was said, thus, binding together all those speaking the same language. Even deeper, it was argued by others, was the connection between those coming from the same genetic stock; the collective identity and sense of “oneness” among a group of people was “in the blood.”

All of these ways of identifying a people’s common nationality were also often linked to a geographical area in Europe that for long period of time, it was claimed, marked off the historical or “natural” homeland of the people sharing that common collectivist root.

The rise of nationalism in the nineteenth and early twentieth centuries now saw the call for all “suppressed peoples” (that is, those minority national groups living within a country dominated by the majority of another nationality) to have their own nation-states to preserve and protect their language, cultural and ethnic uniqueness.

In addition, since under the monarchical system lands had been conquered or acquired through royal marriages that had nothing to do with those “natural” geographical boundaries of various national groups, borders needed to be redrawn. The political borders of countries, it was said, should reflect the national groups that lived within those areas.

There was a problem, however, especially in Central and Eastern Europe. Hundreds of years of wars, conquests and migrations had created overlapping areas of “mixed” national populations. There was little way to nicely and neatly draw the political lines on the map so that only those of a particular national group lived within that national group’s borders.

Every nation-state invariably contained within its political boundaries one or more minorities belonging to other linguistic, cultural or ethnic groups.

Now, if the same individualist and (classical) liberal philosophy that was at the foundation of the American political system also had been present in Europe, there would have been no or few “conflicts” between different national groups living within the same country.

Some people might have found it personally irritating or inconvenient that some of their neighbors spoke a different language, or practiced a different religion or had different cultural traditions and manners. But if their political systems had been based on those same liberal individualist principles as America, then there could have been no politically bestowed favors or privileges for the benefit of those in the majority national group at the social and economic expense of the members of any national minority groups.

But, alas, and again especially in Central and Eastern Europe, this was not the case. Governments were elected or came to power that viewed it as their purpose to secure and safeguard the interests and improvements of the majority national group. Government interventions, regulations, and restrictions were implemented to benefit the one group at the expense of any others. And sometimes this included acts of violence and brutality, which the government either instigated or turned a blind eye to.

Nationalism and the Conflicts over Borders

This ideal of and appeal for national self-determination and self-rule was behind the drive for Italian and German political unification and the revolts of the Poles against the Russians and the Hungarians against the Austrians in the nineteenth century.

The First World War broke up the German, Austro-Hungarian, and Russian Empires that dominated Central and Eastern Europe. In their place arose a host of new or expanded nation-states meant to represent a new political order of national self-determination and self-rule. Many of the governments of these nation-states used the cover of national independence and national preservation to discriminate against and politically and economically abuse clusters of minority national groups under their jurisdictions.

Hitler played upon these “injustices” against German-speaking minorities in neighboring Czechoslovakia and Poland to justify the need to use political and military force to protect these minorities and bring them within the national fold of a greater and “racially purer” Nazi Germany.

In the aftermath of the Second World War, the Soviet Union’s conquest of Eastern Europe and the imposition of communist governments in the countries that were totally controlled by Moscow artificially suppressed practically all of the nationalist differences and animosities of the pre-World War II period.

But with the collapse of those communist regimes in Eastern Europe in 1989-1990 and then the end to the Soviet Union itself in 1991, many of the nationalist conflicts once more rose to the surface. It was witnessed with the peaceful division of Czechoslovakia into two separate countries in 1993.

It was most viciously exposed in the cruel and murderous wars in the former Yugoslavia throughout the 1990s as the various national groups that had comprised Yugoslavia vied for national independence and an insistence upon lands and boundaries consistent with their respective notions of their “rightful” historical borders, which inescapably overlapped with the claims of some of the other national groups.

Borders and Nationalism in the Post-Soviet Countries

With the disintegration of the Soviet Union at the end of 1991, the fifteen “Soviet Republics” had had comprised the Union of Soviet Socialist Republics (U.S.S.R.) became independent nation-states. The problem was that their national boundaries were the legacy of lines drawn on the map by the Soviet leadership, in some cases directly by Stalin in the 1920s and 1930s.

In the case of the Crimea, it had been a provincial unit within the Soviet Russian Republic and was transferred to the Ukrainian Soviet Republic by a decree of the Soviet government in Moscow in February 1954. It was a “gift” to mark the three hundredth anniversary of the merging of Ukraine into the Russian Empire.

Both post-Soviet Russia and Ukraine contain linguistic or ethnic minorities within their borders. In Russia this has been most visible in the conflict that the government in Moscow has waged against the Muslim groups in the North Caucasus mountain regions, the most brutal of which has been with the Chechens desiring national independence.

The political boundaries of Ukraine include the two dominant linguistic groups of the Ukrainians, who make up about 68 percent of the population, and Russian speakers who comprise around 30 percent. (Virtually all Ukrainian speakers also fluently know and use Russian, and many Russian speakers know and understand Ukrainian.)

In the Crimean peninsula, the breakdown is almost 60 percent Russian speaking, 25 percent Ukrainian speaking, and 12 percent Tartars, who are Muslims and speak a Turkic-based language. After the breakup of the Soviet Union in 1991 the Crimea remained part of the new independent state of Ukraine, with no thought to the fact that many of the Russian-speaking people there would have preferred to be part of the post-Soviet Russian Federation.

Historically, many Ukrainians living especially in the western part of the country have long been strongly anti-Russian. This part of Ukraine had been part of the Austro-Hungarian Empire before the First World War, and then was incorporated into the new Poland after 1918.

Western Ukraine only was annexed by the Soviet Union in 1939, as part of the infamous Hitler-Stalin Pact that started the Second World War by a mutual agreement to divide Poland and Eastern Europe between the two totalitarian tyrants.

“Sovietization” of western Ukraine bore down heavily, with many Ukrainians killed or deported to Siberia by Stalin’s secret police as “enemies of the people.” And this was after millions of other Ukrainians in the part of the country already controlled by the Soviet Union before 1939 had been shot, starved or worked to death in the early 1930s as part of Stalin’s forced collectivization of the land.

A sizeable number of Ukrainians actively collaborated with the Nazis after the German invasion of the Soviet Union in June of 1941, including participation in the mass murdering of Jews. Even after the war ended in 1945, bands of Ukrainian nationalists continued to fight the Soviet Army in the forests of western Ukraine until 1951.

The more radically nationalist of the Ukrainians, no doubt, wish to limit the linguistic liberty and language education of the Russian speakers in the eastern areas of the country, where the Russian-speaking part of the population is most concentrated. But many Ukrainians, from all evidence, have no or little sentiment for such discriminatory policies against their Russian-speaking fellow citizens.

A good number of the Russian-speaking citizens of the country feel a much stronger linguistic and cultural tie to Russia next door. Many do resent the sometimes anti-Russian nationalist fervor of some of their fellow Ukrainian citizens. They also sometimes look down upon the Ukrainians as mere “little brothers” of the wider and “greater” Russian people.

This is, clearly, most intense right now in the Crimea. Even separate from the manipulations of the Russian government’s propaganda machine, the majority of the Russian-speakers living in Crimea would most likely prefer a far greater autonomy from the Ukrainian authorities in Kiev, or even to be politically joined with the neighboring Russian Federation.

At the same time, the Ukrainian-speaking parts of the Crimean population, along with the Tartars, would rather be politically a part of Ukraine than under the tighter political control of a Russian-speaking majority, whether just in the Crimea and as part of Russia.

It must be emphasized that the propaganda that has been coming out of Russia since the overthrow of the Ukrainian president, Victor Yanukovych, in February that there has been a “fascist” takeover in Kiev by Nazi thugs and Ukrainian nationalist extremists is an exaggeration from all accounts.

Many of the thousands who were out on the streets of the Ukrainian capital in opposition to Yanukovych’s corrupt regime for over three months, and dozens of whom were shot and killed by government forces, came from a wide spectrum of Ukrainian society, both politically and ethnically. But nonetheless, members of the most extreme Ukrainian nationalist parties do have a number of prominent ministerial positions in the provisional government leading up to the elections to be held in May 2014.

Nationalism and Interventionism the Core of the Dilemma

Nonetheless, the core of the conflict arises from two dilemmas: First, “self-determination” is defined in collective terms. It is not the individual’s right to decide in which nation-state or other political entity he shall freely choose to live. No, this is a matter for the linguistic and cultural group as a whole to which he is identified to belong.

The implicit assumption is that all people who happen to share a common language or culture or religion all have the same interests and desires. This would include a preference to want to belong to the same nation-state as guardian and preserver of one’s group national identity against other national groups who are presumed to be a “threat” to the national collective.

Second, in spite of the degree of market-oriented reforms that have been introduced in both Ukraine and Russia since the end of the Soviet Union, the fact is that both, in their own distinct ways, are political and economic plunder lands of government intervention and manipulation.

The government is viewed as an engine of favor, privilege, and protection from competition. Political connections, bribery, and influence are the determiners of wealth and social status. Tens of billions have been corruptly made and corruptly hidden away at the expense of the majority of the population based on political “pull” and power.

Ukrainians fear that if they were under the control of Russia, the levers of privilege and plunder would flow more through Russian hands than their own, so they would be the victims at whose expense others might benefit. And some Russian-speakers in Ukraine fear that the more radical Ukrainian nationalists would use political power to repress and discriminate against them in various cultural and economic ways.

But it must also be said that an important distinction between the Ukrainian and Russian situations is that in Ukraine right now vast numbers of people have taken to the streets and demonstrated, sometimes with the loss of their lives, their desire for real political change away from political corruption and power plundering. Whether it succeeds in the longer-run without a radical change in political philosophies away from collectivism and in the direction of true individualism remains to be seen.

In Russia, on the other hand, political dissent is forcefully kept in check by an authoritarian regime. It has the additional element of a Russian president, Vladimir Putin, who considers the collapse of the Soviet Union to have been the greatest geopolitical tragedy of the twentieth century, and who wants to restore the “greatness of Russia” in terms of political power and fear on the global stage of international affairs. In Putin’s eyes, Ukraine and Crimea need to be in the Russian sphere of influence and control as a matter of “vital national interest,” even if this means the use of military force and propagandistic lies and deceptions.

Since two political authorities cannot occupy and have administrative control over the same geographical area at the same time – it is either Ukrainian national and political sovereignty or Russian national and political sovereignty over Crimea – the conflict over borders and political control threatens to spill over into potential real war.

Is there no way out of this dilemma? While the reality of nation-state power politics and nationalist appeals to collective identity makes it unlikely, what might be a (classical) liberal or individualist solution to this crisis?

This will be discussed in part II of this article next week.


[Originally published at EpicTimes]
Categories: On the Blog

Trans-Pacific Partnership Negotiations Need to Lead to Fully Free Trade

Somewhat Reasonable - March 19, 2014, 9:15 AM

The United States and Japan are at the trade negotiation table – for the proposed Trans-Pacific Partnership (TPP).

“The 2005 Trans-Pacific Strategic Economic Partnership Agreement (TPSEP or P4) is a trade agreement among Brunei, Chile, New Zealand, and Singapore….

“(T)he US joined the TPP in 2011…. The Obama Administration has begun talks with Asian and Latin American nations to enter into the Trans-Pacific Strategic and Economic Partnership Agreement (TPPA). The talks with Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam were originally initiated by the Bush Administration.”

Absolutely excellent.  The freer the trade the better – the more the merrier.

Not everyone agrees.  Here is the nearly-always-ridiculous New York Times – proffering Joseph Stiglitz.

On the Wrong Side of Globalization

“The conflicting views about the agreements are actually tearing at the fabric of the Democratic Party….”

Good to see Mr. Stiglitz and the Times have their priorities in order.  “It may be great for the nation – but it really hurts our domestic politics.”

In his State of the Union address, for example, (President Barack Obama) blandly referred to “new trade partnerships” that would “create more jobs.

Most immediately at issue is the Trans-Pacific Partnership, or TPP, which would bring together 12 countries along the Pacific Rim in what would be the largest free trade area in the world.

Negotiations for the TPP began in 2010, for the purpose, according to the United States Trade Representative, of increasing trade and investment, through lowering tariffs and other trade barriers among participating countries.

That all sounds very good to me.  Protectionism has been a problem for decades, both abroad – and here.

“For years, (America’s) ridiculous, bloated subsidy-and-tax farm law was only terrible domestic policy.  But as a global farm market developed, it became yet another free trade impediment.

“And it led other farm-exporting countries to erect their own free trade impediments.  Lather-rinse-repeat – decades later the we have turned the global market into an a la carte protectionism nightmare mess.”

So far in TPP negotiations, Japan has been resistant to rolling back some of the government policies that impede free trade.

U.S. Fails to Get Japan to Budge on Tariffs for ‘Sacred’ Produce Items

“The U.S. side has strongly demanded Japan remove tariffs on beef and pork in past negotiations. The other four products are rice, wheat, dairy products and sugar.”

Which is not entirely non-understandable, given the terribleness our government just extruded.

After the Heinous Farm Bill – What Next?

What we need to do is go tit-for-tat with Japan.  Very vocally offer to axe protectionisms in our just-passed nightmare mess – and beyond – in exchange for the Japanese axing theirs.  Oh look – some key domestic players are looking to do exactly that:

US Farm Groups Puts More Pressure on TPP Talks with Japan  

“While strong opposition to the TPP exists in President Barack Obama’s Democratic Party,…several farm industry groups are pushing for its approval.”

There again is the always helpful Democrat Party.

Ag Groups Want Japan Trade Concessions

“Senator Chuck Grassley (R-IA) and representatives of several leading farm groups said Thursday that the U.S. should not agree to a Japanese proposal to leave agricultural products out of the current negotiations for a Trans-Pacific Partnership (TPP) that would reduce tariffs among 12 nations.

“If they get their way, then every other country will suddenly have a list of sacred products that can’t be touched,” said Grassley….”

They’re right – piecemeal freer trade is not free trade.

S.Korea Can’t Join Pacific Trade Talks Until U.S. Issues Fixed

“South Korea will not be welcomed into a planned Pacific free-trade pact until all problems are resolved in carrying out an existing trade deal with the United States, a senior U.S. official said on Thursday.

“Two years after the agreement came into force, the United States was still trying to make sure promises to ease the path for U.S. exports into South Korea were fully met, the official said, pointing to problems with customs regulations and autos.”

So let’s have everyone open up every possible free trade avenue – and let innumerable blossoms of capitalism bloom all over the world.


[Originally posted at PJ Tatler]
Categories: On the Blog

New York’s War on Charter Schools

Somewhat Reasonable - March 18, 2014, 3:45 PM

Charter schools, schools that receive public funding but operate as independent entities, first began to bloom in New York City during the administration of Mayor Michael Bloomberg. Thousands of New Yorkers, sick of the overstretched and ineptly-led public school system, embraced the new era of choice. Organizations like the Success Academy have been opening new schools, in both private and public premises, with astonishing speed, yet they have not been able to keep up with galloping demand. Many places last year had to be allocated by lottery. The demand for and support of charter schools is beyond questioning, as The Economist points out:

“Demand for charter-school places outstrips available slots; entry is by lottery, and some 50,000 children are on waiting lists. Before the election, 20,000 parents, children, and teachers marched across the Brooklyn Bridge to City Hall in support of charter schools.”

The success of the charter school movement in New York is not merely a matter of demand. It is a matter of results. Staggering results, in fact. Children who attend charter schools benefit from better teaching, and are shown to outperform their public school peers across the board. Many underprivileged children from minority backgrounds with traditionally subpar academic performances have, in charter school environments, closed and in some cases reversed the age-old performance gap.

Charter schools offer many cities a palatable mechanism for offering greater choice to families in the field of education. They do take some public funding, and they often rely on state infrastructure to operate, but these qualities ought to be weighed against the alternative, which is incompetent and corrupt state monopoly of education, especially in cities with greater percentages of low-income households. The existence of choice alone has helped revitalize competition in one of the most sclerotic and venal arms of the government apparatus. With the proven enhanced performance, wide popularity, and general social improvements charter schools provide it would seem like a no-brainer for city government to support them.

Yet in New York City, the new mayor, Bill de Blasio, has been waging all-out war against the burgeoning charter school movement. Almost from the moment of taking office in January, Mayor de Blasio has been cutting funding, restricting approval of new charters, and blocking use by charters of public school facilities. The result has been to rob many children of a brighter future they might have gained from a competent educational system.

The reason to de Blasio’s madness is quite simple: teachers’ unions. De Blasio ran for mayor on a platform of returning to pre-Bloomberg norms in New York, a New York he portrayed through rose-tinted glasses as having been more fair and equitable, as a world in which the government took care of its citizens. The problem with that picture, which New York’s voters sadly swallowed, is that it is a complete fabrication. The old New York de Blasio is reviving with gusto was one rife with corruption, a city run to serve the interest of public-service insiders, not the people. Thus it is no surprise that de Blasio has decided to crack down on charter schools, one of the most potent demonstrations, by means of contrast, of the total ineptitude of public schools.

Public school teachers’ unions have long fought against the establishment of any kind of performance standard. Apparently teaching quality cannot be “accurately measured” in any empirical way, so we should allow the unions to make those decisions for us. Apparently, their more holistic approach has led to the conclusion that seniority ought to determine all pay and promotions, and that no one should ever be fired. It is strange that that conclusion has not been reached by any of the thousands of public and private organizations that do consider things like performance standards to be worth evaluating.

The sad truth is that Mayor de Blasio is robbing children of their futures in order to placate the crooked unions he relied on to get elected. His actions are the grossest kind of selfishness, destroying young lives and turning his city back toward oblivion, all while claiming to be leading a return to “fairness”.

Categories: On the Blog

Minimum Wage Fuels Poverty

Somewhat Reasonable - March 18, 2014, 1:30 PM

Minimum wage has become a contentious political issue, even though it has nothing to do with a living wage. Workers are paid for the worth of the job they are paid to do. Nevertheless, Democrats plan to tap into what they perceive as income inequality by using minimum wage as a plank in their populist economic platform heading into the November elections.

It matters not to President Obama that according to the non-partisan Congressional Budget Office (the “government’s own bean counter) Obamacare will result in the loss of two-to two-and-a-half million jobs in the years to come, or that on its heels another CBO report notes how President Obama’s propose minimum wage hike would cost this nation another half-million jobs.

The Democratic ploy in their election-year playbook to hold Republicans hostage to minimum wage was reinforced by President Bush nationwide, when during his State of the Union address he issued an executive order raising the minimum wage to $10.10 an hour for future federal contractors.

And minimum wage continues to be a priority for President Obama. Recently Obama used his weekly address of Saturday, Feb. 22, to cajole Congress into approving a raise in the federal minimum wage that now stands at $7.25 per house, further noting that “while the economy was beginning to recover from the last recession, wages have barely ticked upwards over the past four years.”

According to ObamaRaising Americans’ wages isn’t just a good deed; it’s good business and good for our economy.  It helps reduce turnover, it boosts productivity, and it gives folks some more money to spend at local businesses.

A day before this weekend’s address of Friday, Feb. 21, President Obama pitched the same message at a meeting with members of the Democratic Governors Association in the State Dining Room of the White House in Washington, at which Obama admitted that higher pay is not only “good policy, it also happens to be “good politics.”

Meanwhile, John Boehner, Republican Speaker of the House, believes it’s a job killer.  Boehner once said that he would rather commit suicide than vote for a “clean” increase. 

President Obama is correct in saying that an overwhelming majority of the American people favors minimum wage hikes.  Accordingly, a Quinnipiac poll of Wednesday, January 8th, indicates voters support for raising the federally mandated minimum wage at 72% to 27% percent, with voters still split on what it should be raised to.  But despite this overwhelming support, half of the voters (50% to 45%) believe raising the minimum wage would cause businesses to cut jobs.

How then might such an overwhelming support for a minimum wage hike be explained?  One explanation: The American people tend to be compassionate in nature when suffering is perceived, and believe it isn’t right for a person to work full time and then have to raise their family in poverty.

At the same time there is a dichotomy over concerns expressed for minimum wage workers and what issues Americans care most about.  In a recent Gallup poll conducted on what Americans rate as this country’s biggest problem, raising the minimum wage didn’t make the Top 10.  Unemployment and jobs was rated #1, while Poverty came in at #10.

Might, however, the Quinnipiac poll indicating overwhelming support for a minimum wage hike produced different results had those questioned been privy to facts which discount the benefits accrued from increasing the minimum wage for low income workers?


[Originally posted at Illinois Review]
Categories: On the Blog

Big Business Targets Common Core’s Band of Mothers

Somewhat Reasonable - March 18, 2014, 10:52 AM

The special interests behind national curriculum and testing mandates are pouring millions into public relations and lobbying this spring after parents across the country began to oppose and destabilize their big project. Friday, Politico reported that the Business Roundtable and Chamber of Commerce are buying pricey ads on Fox News and mobilizing their state chapters to keep lawmakers in line. The same day, Bill Gates joined George Stephanopoulos to continue branding the Common Core mandates as a catalyst for improving U.S. education. Gates has joined with left-leaning philanthropies on a communications push worth more than $2.35 million.

Even the federal government is in the game. Through the Common Core testing organizations it exclusively funds, the feds spend at least $9.9 million to promote Common Core, largely through locating teachers who like the project and training them as spokespeople. The Fox News ads will also feature teachers, since focus groups have found them to be well-received pitch-men.

Since January 1, lawmakers in at least 23 states have proposed to amend or repeal Common Core. This spring’s state legislative sessions mark the last real chance to ditch it, so the battle has escalated.

This fall, federally funded and controlled Common Core tests are slated to roll out and essentially cement it (until the next big thing). These tests and their corresponding curriculum mandates will influence almost everything about most American schools: teacher evaluations, textbooks, learning software, school funding, even student grades. In 2013, most parents and teachers first met Common Core. Some began to complain about federal overreach, lack of public debate, pilot test questions and format, open-ended data collection, academic quality, technology costs for the all-online tests, and lack of training for teachers.

In Oklahoma this week, Gov. Mary Fallin and the Oklahoma Chamber of Commerce worked overtime to keep a Common Core repeal bill from getting a hearing or vote. Eyewitnesses said the governor pulled senators off the statehouse floor to lobby them to kill the bill. It worked, but only halfway: Senate leaders killed the Senate bill, but a House version passed 78-12.

Also working the floor was Jenni White, a mother of five (two adopted) and former science teacher whose main weapon against the business coalitions and their millions is her smartphone. White’s family checkbook covers her frequent trips to the statehouse to counter well-paid, hardened lobbyists and career backroom dealers. She and a small band of moms have been patrolling the statehouse, visiting lawmakers’ offices to look them in the eye and remind them that hundreds of Oklahomans have repeatedly swarmed the capitol on their own dimes just to get their bill a hearing.

“It’s never been about kids or parents, it’s about ‘the Chamber of Commerce can help me with my campaign,’” White fumed from the capitol late Wednesday.

White has counterparts everywhere. In Kansas, it’s Kristin George.

“I look at my kids and I can’t imagine not fighting back for what I see as their whole future in education,” George says over the phone as her preschooler pesters her in the background. “It’s so much more to me than just standards. My son will tell me, ‘Mom, I think you’ve had enough computer time today.’ I feel like I’m fighting something because of them, and then taking time from them to do it.”

U.S Education Secretary Arne Duncan was right about one thing when he attacked anti-Common Core activists again in November: like George, they are mostly mothers. The media still usually labels Common Core opposition as Tea Party-driven, and that’s true to some extent, but the real drivers are mothers who saw Common Core in their kids’ classrooms and thought it degraded instruction.

Pack ‘n Play in tow, George frequently drives five hours to Topeka to lobby for legislation to curtail or repeal Common Core. She stays with her in-laws, leaving her five- and two-year-old sons there while she and other mothers trot to legislators’ offices for hours before crucial hearings and votes.

“The grassroots has only gotten stronger across the country and in Kansas,” she says. They will need strength to compete. Common Core’s supporters include the world’s largest nonprofit organization (the Bill and Melinda Gates Foundation, which has spent more than $172 million to underwrite Common Core), President Barack Obama, and big businesses such as Exxon Mobil and GE.

Business groups often believe the talking points that proclaim Common Core will end rising phenomena like workers who won’t show up on time, can’t read or do basic math, and loaf around on the job. These are business’s biggest complaints about the kids our education system turns out. Oddly, business interests seem to ignore not just the evidence that Common Core graduates will not be internationally competitive, but that family degradation is a major—perhaps the major—reason for workers’ eroding soft skills and academic incompetence. Ironically, White and George’s devotion to their families makes them the kind of mothers whose kids will be the productive citizens employers want schools to produce.

George has talked to moms in her library’s toddler reading group and held potlucks to tell others about Common Core. A Kansas Tea Party group passed around a blue bucket last year to pick up donations from a room of retirees and parents to cover an out-of-town speaker who criticized Common Core. Grassroots folks in New York tried a crowd-funding site to cover travel expenses for their two February Common Core speakers. They raised $1,005 toward their $5,000 goal.

Common Core opponents typically don’t have much money or prestige. They do have a common motivator: their kids. George’s biggest concern is her ability to have a say in the policies that affect her family.

“I grew up with parents who said, ‘You can do anything you put your mind to,’ and that was the beauty of the country we live in,” George said. “I don’t want to see that changed for my children.”


[Originally posted at The Federalist]

Categories: On the Blog

In Defense of the Uninsured

Somewhat Reasonable - March 18, 2014, 9:21 AM

The entire premise of the trillions of dollars being spent on Obamacare is that it is essential that every single person have health insurance coverage at all times under all circumstances.

Health insurance is the most important thing on the face of the earth — more important than food, more important than clothing, or housing, or a job, and certainly more important than cell phones and cable TV, according to the President.

People without health insurance are terrible people – free riders, leaches, irresponsible deadbeats.  There is us (the insured) and them (the uninsured). We are good and they are not. Which is why we never bothered to ask them what they might be looking for in a health insurance policy. We passed the law requiring them to buy what we think they should buy.

With this contemptuous attitude towards the people the elite is trying to “help” perhaps it is not surprising that the helpees are not behaving the way the helpers would like them to. Amy Goldstein writes in the Washington Post that “Health insurance marketplaces (are) signing up few uninsured Americans…”

Megan McArdle is even more stark in Bloomberg, “How Not to Help the Uninsured.”  She includes a fascinating graph:

We are five months into open enrollment and 56% of the uninsured haven’t even looked into getting coverage, and another 34% looked but declined to buy. Ten percent of the uninsured are newly covered, but 18% of the previously insured are newly uninsured.

Very few of the people who wrote this law have ever been uninsured or even know anyone who has been. They are well educated and gainfully employed. Their entire world-view and values belong to what used to be called the bourgeois state of mind. They obey all the laws, are generally well mannered, save money for their children’s college funds, eat right and exercise regularly. They don’t take risks and they don’t get into fistfights.

They believe that the world would be a better place if everyone were more like them.  They are also pretty powerful people, though they may not see themselves that way. They have money and influence, they rank high on Google searches, they write articles that actually get published. They are articulate and respected by their peers.

And they want to do good. They want to leave the world a better place. So they reach out for the levers of influence available to them – usually government – to create policies that will improve the lives of the less fortunate. These efforts range from the annoying, like banning Big Gulp sodas, to Obamacare’s mandate that everyone must buy insurance or be penalized.

The problem is that these people are not much like the rest of America. They may disapprove of Big Gulp sodas but the product is wildly popular in the rest of the country. As Rick Santorum reminded the crowd at CPAC, only 30% of the country will ever graduate from college. That doesn’t make the other 70% stupid or ill-informed, it just means they don’t have the patience to sit in a classroom day after day for years on end being lectured to by pompous buffoons.

Some seven years ago (2007) Duke Law School published an edition of its journal “Law and Contemporary Problems” devoted to “Distributional Issues in Health Care.” It included articles by writers such as Mark Pauly, Mark Hall, Christopher Conover, and Tom Miller, but for me the most interesting article was the Foreword by editors Clark Havighurst and Barak Richman.

They argue that poor and working people are poorly served by coverage decisions made by upper middle-class managers who load up on benefits with little value to lower-income workers — “… lower-income insured get less out of their employer’s health plans than their higher-income coworkers despite paying the same premiums.” They conclude, “… in health care perhaps more than any other sector, the true interests of consumer-voters are ill-served by the political, regulatory, and legal environment.”

In other words, workers in a corporate environment will accept the coverage provided by upper-class management, but once they are on their own they simply don’t see any value in the super-rich and expensive benefits the elites prefer. But the regulatory structure precludes the offering of anything more modest, so these people vote with their feet and become uninsured.

That was certainly my experience. In the 1990s, after I left my job with the Blue Cross Blue Shield Association, I went without coverage for five years while I started three separate businesses. I simply could not afford to both start these businesses (which ended up employing 45 people in Northern Virginia) and pay for health insurance. You might not make the same decision, but the 45 people I hired were probably pretty happy that I did. If some sort of catastrophic illness plan had been available I probably would have bought it, but such were not permitted at the time.

I am not alone. Tens of millions of people have made rational decisions to spend their money on things that are more important than health insurance, at least for a time. I could list a couple of dozen people I know personally who have made this decision. Who is to say they are wrong?

In most markets when a large number of people are not buying your product, you look to see how to improve the product to make it more appealing. Only in health care is it considered acceptable to command people to buy what they have rejected. No wonder the elite wants to ban the word “bossy.”

[Originally posted at The Federalist]

Categories: On the Blog

Accelerating the De-Americanization of the Internet

Somewhat Reasonable - March 18, 2014, 9:03 AM

The Internet’s moorings are detaching from America.

Last week two big decisions — one American and one European – accelerated the  de-Americanization  of the Internet. Edward Snowden’s revelations catalyzed both.

The U.S. government just chose to hand over its master key to the  Internet — the “root-zone-file” — to the Internet Corporation for Assigned Names  and Numbers (ICANN), a multi-stakeholder non-profit organization, in October of  2015.

The “root zone file” is the essential core-addressing database that the  Internet depends upon to ensure any Internet addressed device can link to any  other Internet-addressed device.

To understand the significance of this real and symbolic transfer of power,  one must appreciate America’s history of Internet stewardship.

The U.S. Defense Department invented Internet protocols in the 1960s. Since  then the government has been the owner and steward of the Internet’s  connectivity architecture.

In the 1990s, the government privatized the Internet backbone. In 1997, the  Clinton administration laid the Internet’s current commercial foundation in The  Framework for Global Electronic Commerce. In 1998, it  transferred responsibility for the administration of many Internet-related tasks  to ICANN.

The ceding of control over the “root-zone-file” database is a big deal. With  it America will cede ultimate “ownership” of the Internet’s core to the Internet  community-at-large via ICANN.

Practically, this means America will no longer effectively control how the  Internet changes or evolves.

Anyone who thinks transferring ownership of the Internet’s proverbial rudder  won’t alter the Internet’s long-term trajectory does not understand this  change.

America’s stewardship of the Internet for the last twenty years fostered its  commercial potential. Consequently, it is no surprise America’s Silicon Valley  effectively dominates most every commercial and behavioral aspect of the  Internet.

The priorities of a multi-stakeholder, not-for-profit organization that’s  un-tethered from, and unaccountable to, sovereign or commercial interests will  prove to have very different priorities than America’s as it tries to  incorporate the rest of the world’s conflicting priorities.

What does this mean?

Over time the Internet will become much less American, much more diverse, and  vastly more political, both internally and geopolitically.  And expect a  less American Internet to naturally become less commercial, less Silicon  Valley-centric, and less friendly to property.

This unmooring of the Internet from American sovereign control and dominance  comes with one last big stewardship caveat from the U.S. government. To affirm “the United States support for the  multistakeholder model of Internet governance, [the U.S. government] will not  accept a proposal that replaces the [the U.S. government] role with a  government-led or an inter-governmental organization solution.”

This is a profound geopolitical change and challenge. It effectively will try  to officialize a sovereign-less third global power base separate from national  sovereign powers and intergovernmental organizations like the UN.

Thus the Internet’s long-term evolution will now hinge on how much sovereign  power the rest of the world is actually willing to cede to, or how much power it  tries to take from, this newly empowered sovereign-less polity. Welcome to the  Internet realpolitik era.

The second big decision last week that will accelerate the de-Americanization  of the Internet was made by the European Parliament.

The European Parliament voted overwhelmingly 621-10 for much stronger  data protection (privacy) laws, the first such change since 1995.

It also overwhelmingly backed a resolution calling for the suspension of the  U.S.-EU data protection Safe Harbor that lets U.S. firms self-certify  as being in compliance with EU privacy law, by a vote of 544-78.

This seminal new data protection law could be a game changer for much of the  Internet. While much more remains to be worked out, the EU’s new post-Snowden  trajectory is clear.

Essentially, the EU is asserting sovereignty over the European Internet so  European data will be subject to EU law and stored in the EU. The law also  grants EU citizens the right to demand erasure of their online data for the  first time.

To simplify, the EU is calling for a more consumer-centric, opt-in privacy  model in stark contrast to America’s ecommerce-centric, opt-out privacy model.  This is a frontal assault on Silicon Valley’s privacy-hostile, dominant  advertising business model.

So what does this European decision foretell?

A more privacy-friendly Internet is a less American-dominant Internet, a less  Silicon-Valley or Big Data driven Internet. Since cloud computing is a euphemism  for American-based data centers and data-processing, this new law will likely  force a lot more EU-localized data centers.

The real purpose of this new law is not only to protect Europeans’ privacy,  but also to create economic opportunity for an indigenous European tech, cloud  and Internet sector to succeed.

In sum, the precipitating cause of both of these two decisions is the same –  Snowden revelations.

However, the consequential effect of these decisions is the opposite. The  U.S. decision cedes its sovereign power to a new sovereign-less power. In  contrast, the EU’s decision asserts much more sovereign power over a  sovereign-resistant Internet.

As the Internet’s moorings increasingly detach from America, the Internet  ship will enter the uncharted waters of Internet realpolitik.

This article is Part 5 in the series “World Changing the Internet”. To read the other installments, click here: Part 1, Part 2, Part 3, Part 4

[Originally posted at The Daily Caller]
Categories: On the Blog

Portland Light Rail Revolt Continues

Somewhat Reasonable - March 18, 2014, 12:15 AM

In a hard fought election campaign, voters in the city of Tigard  appear to have narrowly enacted another barrier to light rail expansion in  suburban Portland. The Washington  County Elections Division reported that with 100 percent of precincts  counted, Charter Amendment 34-210 had obtained 51 percent of the vote, compared  to 49 percent opposed.

The Charter Amendment establishes as city policy that no  transit high capacity corridor can be developed within the city without first  having been approved by a vote of the people. High capacity transit in Portland  has virtually always meant light rail.

In a previous ballot issue, Tigard voters had enacted an  ordinance requiring voter approval of any funding for light rail. Similar  measures were enacted in Clackamas  County as well as King City in Washington County. Across the Columbia River  in Clark County (county seat: Vancouver), voters rejected funding for  connecting to the Portland light rail system. After  the Clackamas County Commission rushed through a $20 million loan for light  rail (just days before the anti-light rail vote), two county commissioners were  defeated by candidates opposed to light rail, with a commission majority now in  opposition.

Further, a Columbia River Crossing, which would have  included light rail to Vancouver was cancelled after the Washington legislature  declined funding. In a surreal aftermath, interests in Oregon seriously  proposed virtually forcing the bridge on Washington, fully funding the project  itself. A just adjourned session of the Oregon legislature failed to act on the  proposal, which now (like Rasputin) appears  to be dead.

At the same time, Portland’s transit agency faces  financial difficulty and has been seriously criticized  in a report by Secretary of State. The agency has more than $1 billion in  unfunded liabilities and carries a smaller share of commuters than before the  first of its six light rail and commuter rail lines was opened. Moreover, the  latest American Community Survey data indicates that 3,000 more people work at  home than ride transit (including light rail and commuter rail) to work in the  Portland metropolitan area. Before light rail (1980), transit commuters  numbered 35,000 more than people working at home. Over the period, transit’s  market share has dropped one-quarter.

[Originally posted at New Geography]
Categories: On the Blog

I’ve Figured Out the AGW Strategy

Somewhat Reasonable - March 17, 2014, 11:22 PM

I am starting to think the AGW/climate change/climate disruption/carbon pollution agenda is to simply make such outrageous comments that my side gets tired of having to deal with it.

This hit me a couple of nights ago when I tried to watch five minutes of the “all nighter clim-a-thon” being staged by a select group of senators. After a couple of minutes – and I will not say what I heard or who said it to set me off – I decided it was enough, so I watched something with more substance – Dallas – on TNT.

Oddly enough Bobby Ewing stopped his nephew JR Jr from fracking his part of Southfork by saying there was an endangered species on the property (the lean Prairie Chicken I think it was). Even Dallas has an energy-based debate going on. Interestingly enough Southfork, which in the show is a working cattle ranch, is also in the cross hairs of climate change since, after all, we all know cows cause increases in methane which is one of those dreaded greenhouse gasses that, if left unchecked, will take the Earth to Venetian temperatures (sarcasm).

And besides, eating meat is bad for you. I never have steak for dinner anymore – it’s usually breakfast, when I can afford it (which is getting rarer; then again, that is how I like my steaks: rare).

So when I was writing this week, I decided to have a little fun and pull out an outrageous example of how absurd this is getting. And I am not going to pick on the obvious – some of the leaders of our government pushing all this. Instead I want you to think about this headline:

Will climate change bring back SMALLPOX? Siberian corpses could ooze contagious virus if graveyards thaw out, claim scientists …

• The disease, which causes a painful blistering rash and sometimes blindness and death, was wiped out in 1979

• Some experts fear defrosting bodies in Siberia could potentially begin a cycle of infection, if a person makes contact with remains

• Defrosting bodies are coming to light as a result of global warming, although so far scientists have not found any remains with a virus in them

Now this is fascinating for a couple of reasons. Just how long has Siberia been warm where all these corpses are thawing out? Well over the last 3 years, it hasn’t been warmer than normal except near the Arctic Circle where it’s so cold anyway that a one degree rise isn’t that big a deal. Besides, who is buried in the Arctic Ocean? (Maybe that is where Jimmy Hoffa is…)

And if they were thawing before, they certainly aren’t this winter!

But this is not the real question. Again, think about the extremity of foolishness going on here. They are so foolish that they don’t even stop to think: Just how did they bury the people in the first place if the ground wasn’t thawed out before? It had to be warm enough to dig deep enough to bury these people – or did they have some type of drill none of us know about during the time of small pox to bury people? The whole article supports the notion of natural climate variations, because if it warms to levels to thaw these graveyards out, it is merely warming to where it had to be before. You can’t have it any other way.

But things like this are all too common in this argument. In all my years in weather and climate, which I use and always have as a major piece in the foundation of my forecasts, I have never seen such nonsense and ignorance being spewed with no regard for the facts of what actually happened.

I guess one has to laugh at all this. At least I am trying too. I am on everyone’s mailing list so I get sent countless articles on this. I also get sent the scholarly articles both for and against human influence on the climate. I know and understand the reason this is actually a debatable point and have pointed out several times that two major indicators – stratospheric cooling and the outgoing radiation measurements – support the idea of a slowly warming troposphere. Whether that is natural or man-made is impossible to call, for Earth has warmed before (it had to if you could bury people in Siberia) and has also cooled. How one could possibly know this is CO2-driven given the history of CO2 and temperatures that show there is no correlation, yet alone causation, is beyond me.

But I guess one needs to keep a sense of humor about all this. I believe many of the people putting out things like what you see here are whistling by the graveyard in this sense:

To enter a situation with little or no understanding of the possible consequences.

The consequences are basically the disruption, if not destruction, of our way of life and the hopes of countless people for a better life.

I prefer, when looking at this debate and what its actually about, to use part of a second definition.

To attempt to stay cheerful in a dire situation.

In the meantime, just in case they are right, I have cancelled plans for a tour of Siberian graveyards. Too cold anyway, given the actual weather.

[First posted at The Patriot Post.]

Categories: On the Blog

Governments Mandate Monopolies Then Complain About a Lack of Competition

Somewhat Reasonable - March 17, 2014, 10:23 PM

The solution to government – isn’t more government.  But that’s exactly what governments proffer all the time.

They pass a government-expanding law – which warps, distorts and otherwise damages the private marketplace.  They don’t offer to repeal the law – of course not.  They instead pass another government-expanding law – to “fix” the mess they made with the last one.  Lather, rinse, repeat.

Just wait – soon the Democrats will propose as the “solution” to the disastrous ObamaCare…all-government-all-the-time single payer.

But we already had Huge Government health care – Medicare and Medicaid.  Which face tens of trillions of dollars in looming shortfalls.  Did the Left proffer less government reform?  Of course not.  They gave us government-expanding ObamaCare – and stole (at least) $741 billion from already-broke Medicare to do it.

You know why the federal government is the only entity delivering First Class Postage?

The Postal Service has a legal government monopoly on delivering first-class mail…. (Prospective competitors) are required by law to charge a high minimum price and cannot undercut USPS rates.

Nothing like the government gaming the system – to favor the government.  And how’s their monopoly working?

Postal Service Loss Of $15.9 Billion Sets Record

And guess who’s screwing up cable and Internet delivery?  Why, it’s government.

Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition

Game of Kickbacks

Local governments and their public utilities charge ISPs far more (for building rights) than these things actually cost. For example, rights of way and pole attachments fees can double the cost of network construction….

These (government) incumbents – the real monopolists – also have the final say on whether an ISP can build a network. They determine what hoops an ISP must jump through to get approval.

This reduces the number of potential competitors who can profitably deploy service.… The lack of competition makes it easier for local governments and utilities to charge more for rights of way and pole attachments.

It’s a vicious circle…(A) system of forced kickbacks….(also) includ(ing) ISPs…building out service where it isn’t demanded, donating equipment, and delivering free broadband to government buildings.

How bad does it get?

Video franchises are the revenue-sharing agreements that cable TV companies sign with local governments in return for the exclusive right to offer video services to customers.

Get that?  It’s the government creating the monopolies – not the (very un-free) market.  The answer?  Less government.

Video Franchise Reform Would Support Competition and Consumer Choice

Because (private providers) were able to go directly to the state capital for permission to deploy video services anywhere in the state, they were able to accelerate their rollout. Consumers saw quick results.

Amazing what happens when you can bypass all the local governments and their myriad shakedowns.

The Left’s response?  More government.  They want local government broadband – ObamaCare for the Internet.

The Promise of Municipal Broadband

Municipal Broadband Networks Bridge the Digital Divide

To Help Connect the Two New Yorks, Bill de Blasio Should Build More Community Broadband

Municipal Broadband Would Provide the Competition Necessary to Make Seattle’s Broadband Market Function

Government mandates create private monopolies – government then decries the dearth of competition as justification for government broadband.

Government taxes private broadband companies – and then uses their money to fund competitors to their businesses.

And imagine these private companies trying to set up service – having to ask the permission of the governments that are competing with them.

The people wanting this nonsense are the same ones demanding Network Neutrality imposition to prevent Comcast-NBC from slowing Netflix so as to favor their video service. Which has never happened – and never will.  Because their customers would freak – and fire them.

Will government block private companies to favor their service?  Of course.  See: Medicare.  And the U.S. Postal Service.  Because no matter how much we “customers” freak – we can’t fire them.  Government law says so.

President Barack Obama loves the local government broadband approach.  It’s community broadband organizing - building single-payer government-only service from the ground up.

“(T)he ultimate goal is to get rid of the media capitalists in the phone and cable companies and to divest them from control.

The 2009 “Stimulus” law contained a $7.2 billion down payment towards it.  How’s it all worked?  Predictably – terribly.

The Internet ‘Stimulus’-Just as Destructive as the Rest of the ‘Stimulus’

Yet Another Terrible Internet ‘Stimulus’ Project

Despite Glossy Reports, Muni Broadband is Still a Net Money Loser 

Provo’s Failed Muni Broadband Purchased by Google for $1

Google did not assume the thirty nine million dollar debt already hanging over the project. The city is still on the hook for that….

Google will be subsidized in Provo by the citizens, some of whom in delusion think that they are getting ‘free’ internet….

A citizen who opts for a competitor will be paying the fee for the service, and also the elevated taxes and fees the failed municipal broadband project has left behind.

Hard to fathom why Google favors government broadband.

North Carolina Taxpayers Face Bailout of Muni Broadband Service 

Burlington, Vermont Broadband Mess Haunts Northland, Minnesota

It’s so bad.

20 States Now Have Restrictions on Municipal Broadband

Is the Barack Obama Administration thinking less government?  And federalism?  Of course not.

FCC Thinks It Can Overturn State Laws that Restrict Public Broadband

“The Commission will look for opportunities to enhance Internet access competition,” (FCC Chairman Thomas) Wheeler said in a statement.

“One obvious candidate for close examination was raised in Judge Silberman’s separate opinion, namely legal restrictions on the ability of cities and towns to offer broadband services to consumers in their communities.”

According to this Administration, the “solution” to government-mandated monopolies and disastrous government broadband is…more government broadband.

And if they have to unConstitutionally steamroll the states to do it – so be it.

[First published at Human Events.]

Categories: On the Blog

U.S. Energy, the Ukraine, and Russia

Somewhat Reasonable - March 17, 2014, 10:00 AM

The Ukraine came apart when a protest against its president forced him to flee to Russia. The issue was whether the Ukraine would be allied with Russia or with the European Union. Due to a combination of the obscene corruption of its former president, Viktor Yanukovych, and the mismanagement of the nation in general, the Ukrainian Parliament ousted him in February, a move supported by 328 members of the Parliament. He still claims to be president.

In contrast to the “melting pot” of America where people come from all over and develop strong feelings for our nation, the Ukrainians, divided primarily between the East and West, never quite gelled, the younger generation does not want to be back under the sway of Russia while many of the older ones, recalling the bad old days when it was, want closer ties with Europe. It remains divided and whether it will reunite is anyone’s guess.

If it does reunite, it will be missing the Crimean republic which has been seized by Russia’s leader, Vladimir Putin. It had been part of Russia for hundreds of years and represents a critical warm water port. Krushchev relinquished it to Ukraine, but Putin will not. Sending troops into a foreign nation is an act of war, but I doubt that many Crimeans, see themselves as a foreign nation. They were Russian and they are Russian. Let’s move on.

Putin’s bold action brought a lot of other issues into play, not the least of which is Russia’s provision of natural gas to Ukraine and many European nations that depend on it, not the least of which is Germany.

One thing is for sure, NATO will not intervene to restore Crimea to the Ukraine and the European Union has so many financial ties to Russia that there is little reason to do anything than go through the charade of sanctions and criticism. I think the general consensus is that while Putin would like to expand the Russian Federation to the size of the former Russian empire, the cost of similar military actions would be too high.

The response of President Obama has been predictably weak. He is abandoning the Middle East to Islamic fascists. He has failed to provide an umbrella of military protection to Europe. He and Democrat members of Congress continue to tell us that the greatest threat here and worldwide is a global warming that isn’t happening.

The greatest threat to American security is President Obama for two reasons: (1) He has deliberately weakened the U.S. military and (2) his domestic energy policies have failed to take advantage of discoveries of massive amounts of natural gas and oil reserves. Drilling for them on federal lands and offshore has been largely thwarted. As a result the U.S. economy has limped along when it could be booming just from the energy sector alone.

Two reporters for The Wall Street Journal spelled out why the “U.S. Push for Natural-Gas Exports to Ukraine Faces Hurdles” in its March 12the edition.

“Neither the infrastructure nor international markets for natural gas have evolved to the point where the U.S. can step in and provide the kinds of energy supplies that would quickly reduce these nations’ dependency on Russian gas.”

“U.S. energy companies need several more years to build plants to export the gas—and Ukraine doesn’t have the facilities to receive it…The giant machines and cooling towers it takes to make liquefied natural gas, or LNG, take years to construct and cost billions of dollars.” There is at present a LNG terminal in Spain that could take gas shipments that could be added to the extensive European pipeline network, helping many nations there such as Hungary and the Czech Republic.

Suffice to say, U.S. policy and lawmakers have failed to take the actions necessary to respond to the recent surge in natural gas and oil supplies. Many Americans will be surprised to learn that in the 1970s Congress made it illegal to export domestically produced crude oil without a license. Those were the days of the Arab oil embargo.

At this point, the U.S. has more untapped oil than Saudi Arabia, as well as enough natural gas and coal to make us energy independent.

In addition, an odd and idiotic law requires the production of ethanol, a gasoline additive. In 2013, ethanol production was 316,964 thousand barrels. Ethanol not only decreases the mileage of the gasoline we purchase at the pump, it damages auto engines, two very good reasons to end this conversion of corn into energy that in turn drives up the cost of countless food products.

Even moving crude oil around the domestic U.S. poses a challenge despite a network of pipelines. Doing so by train has created many new problems. President Obama has delayed the Keystone XL pipeline that would increase crude oil supplies to our Gulf State’s refineries; thus denying us the jobs its construction would create and other benefits. The good news is that the U.S. has become one of the largest gross exporters of refined oil products such as gasoline and diesel.

If the U.S. government would get out of the way, new refineries and export facilities for natural gas could be built. The U.S. would prosper and energy costs would be reduced, along with our national debt. For now, however, the Ukraine, a longtime financial basket case, and Europe are not going to get a surge of natural gas or crude oil that would help reduce their dependence on Russia.

So long as President Obama remains in office, none of the steps that must be taken to restore the nation’s economy and tap the huge potential of our energy sector will occur.

Categories: On the Blog

Relentless Global Warming ‘Scientists’ Continue Their Scams

Somewhat Reasonable - March 17, 2014, 3:41 AM

Despite the growing worldwide recognition that global warming—now called climate change—is a hoax and that the Earth has been in a cooling cycle going on seventeen years, those most responsible for it continue to put forth baseless “science” about it.

The hoax has its base in the United Nations which is hosme to the Intergovernmental Panel on Climate Change (IPCC) and got its start with the Kyoto Protocol in 1997 that went into force in 2005. It limits “greenhouse gas” emissions, primarily carbon dioxide (CO2). It purports that the gases are warming the Earth and many nations signed on to reduce them. The U.S. did not and in 2011 Canada withdrew from it. Europe is suffering economically from the billions it invested in “alternative energy” sources, wind and solar power.

Five years ago, emails between a group of the United Kingdom’s University of East Anglia scientists and others who were generating computer models that “proved” global warming were revealed. It was quickly dubbed “climategate” for the way the emails demonstrated the manipulation of data claiming that global warming was real. They had good reason to be worried, given the natural cooling cycle the Earth has entered, but of even greater concern was the potential loss of enormous amounts of money they were receiving for their deception.

To date, not one of theirs and other computer models “proving” global warming have been accurate.

On Wednesday, March 10, The Wall Street Journal published an article, “Scientists Say Four New Gases Threaten the Ozone.”  It reported on the latest effort of “scientists” at the United Kingdom’s University of East Anglia and it is no coincidence that the university was the center for the original IPCC data created to introduce and maintain the global warming hoax.

“Traces of four previously undetected man-made gases have been discovered in the atmosphere, where they are endangering Earth’s protective ozone layer, a team of scientists from six countries reported Sunday.”

Trace gases are those that represent less than 1% in the Earth’s atmosphere. CO2, for example, represents a meager 0.038% of the atmosphere and represents no impact whatever on the Earth’s climate. It is, however, vital to all life on Earth as it is the “food” for all of its vegetation.

“The gases are of the sort that are banned or being phased out under a global treaty to safeguard the high altitude blanket of ozone that protects the planet from dangerous ultraviolet radiation, experts said.” These “experts” failed to mention that everywhere above the Earth’s active volcanoes the ozone is naturally affected by their massive natural discharge of various gases. The oceans routinely absorb and discharge CO2 to maintain a balance. The bans included the gas used primarily in air conditioners and for refrigeration. It has since been replaced.

Another gas that was banned is a byproduct of chemicals called pyrethroids that “are often used in household insecticides.” Banning insecticides is a great way of reducing the Earth’s population as insects spread diseases and destroy property. Ironically, termites produce massive amounts of carbon dioxide.

The means used to detect the gases included comparing “the atmosphere today to old air trapped in annual layers of Greenland snow” and they also studied “air collected by high altitude research aircraft and by sensors aboard routine passenger jet flights around the world.” Not mentioned is the fact that the Earth has had higher amounts of CO2 in earlier times which posed no threat to it, so a few trace gases hardly represent a “threat.”

This kind of questionable “science” was practiced by one of the most well-known of the East Anglia scientists, an American scientist named Michael Mann, who used tree ring data to prove a massive, sudden increase in CO2 in his “hockey stick” graph that has since been debunked by skeptical scientists.

Mann has brought a libel law suit against columnist Mark Steyn, the National Review and the Competitive Enterprise Institute, charging defamation. Such suits cost a lot of money and Robert Tracinski, writing in Real Clear Politics in February noted that “it’s interesting that no one asks who is going to go bankrupt funding Mann’s lawsuit. Who is insuring Mann against this loss?”

Tracinski pointed out that “It is libel to maliciously fabricate facts about someone” but that it is “legal for me, for example, to say that Michael Mann is a liar, if I don’t believe his erroneous scientific conclusions are the product of honest error. It is also legal for me to say that he is a coward and a liar, for hiding behind libel laws in an attempt to suppress criticism.” The East Anglia emails revealed that they were doing whatever they could to suppress the publication of studies that disputed global warming in various science journals.

How specious is this latest announcement about trace gases that they assert are a threat to the ozone layer? An atmospheric chemist, Johannes Laube of the East Anglia group making the announcement, was quoted as saying “We are not able to pinpoint any sources” for the trace gases. “We are not able to point a finger.”

The objective of the announcement is the same as the creation of the entire global warming hoax. It provides the basis for the transfer of funds between developed and undeveloped nations and would grant greater power to the United Nations to reduce the world’s manufacturing base while endangering and controlling the lives of everyone on Earth.

Is the latest “research” a lie? The data it cites has some basis in fact, but those facts are an excuse, like those cited about greenhouse gases, to frighten nations into wasting billions on climate threats that do not exist. The real threats remain climate events over which mankind never has and never will have any control.

[First posted at Warning Signs.]

Categories: On the Blog

A New FCC and a New Communications Act

Somewhat Reasonable - March 16, 2014, 8:10 PM
Anyone who has followed communications law and policy for a number of years – and I’ve been doing so for over thirty-five years – knows that the marketplace environment has changed dramatically in the last “number” of years. And undeniably – although at times some do try to deny it – the change has been in the direction of more competition and more choice for consumers.

Another way of saying this is that there is more competition and more consumer choice for data, video, voice, and any other service or application that is offered over various digital networks, whether the technological platform employed is called “cable” or “telephone” or “wireless” or “satellite” or “fiber” or whatever.

Of course, there may be legitimate debates concerning theextent to which competitive market forces are present in particular market segments at particular times. It has never been my view that in instances of demonstrated market failure there is not a role for proper government regulation. I have often stated, however, here and elsewhere, that in today’s communications marketplace, in which the digital revolution is driving more competition, absent convincing evidence of market failure, the default presumption should be that the costs of regulation outweigh the benefits.

You may have thought it strange that I put “number” in quotes in the first paragraph. But I did it for a reason. I want you to think about the passage of time – maybe about how quickly time flies, as they say – while many of the laws and regulations that govern participants in the communications marketplace remain in place, as if frozen in time.

So, for example, in thinking about marketplace change and the passage of time, recall that the regulations governing multichannel video distributors, like cable operators, largely were put in place by the Cable Act of 1992 – almost a quarter century ago.

And the “silos” that establish the regulatory framework for most market participants were left in place in the last major revision to the Communications Act – the Telecom Act of 1996. Yet the “Internet,” which so dominates our policy debates now, was mentioned only twice in the 1996 Act.

And in 2000, in connection with their “petition to deny” filed with the FCC, a coalition of consumer groups issued a dire warning that the then-proposed merger between AOL and Time Warner “would fuse the country’s largest online company with the world’s biggest media and entertainment conglomerate.” This, they argued, “would allow two enormous firms to dominate the markets for broadband and narrowband Internet services, cable television, and other entertainment services, which could leave consumers with higher prices, fewer choices, and the stifling of free expression on the Internet.” Well, we know how that prediction turned out.

And in 2004, the FCC initiated what it called the “IP-Enabled Services” proceeding to consider a proper regulatory model for the rapidly growing Internet services. The agency pointed out that the greater bandwidth of broadband networks encourages the introduction of services “which may integrate voice, video, and data capabilities while maintaining high quality of service.” Then, in a prediction that came to pass shortly thereafter, the FCC added: “It may become increasingly difficult, if not impossible, to distinguish ‘voice’ service from ‘data’ service, and users may increasingly rely on integrated services using broadband facilities delivered using IP rather than the traditional PSTN (Public Switched Telephone Network).” In the decade since 2004, the Commission never took any further meaningful action in the IP-Enabled Servicesproceeding. Finally, earlier this year, in response to a petition filed by AT&T in 2012, the agency authorized trials as part of its IP-Transition project.

I could go on with the timeline but you get the point. The communications marketplace environment has been and continues to change rapidly – and the laws and regulations governing the marketplace have not kept pace.

Which brings me to the Free State Foundation’s Sixth Annual Telecom Policy Conference next Tuesday, March 18, at the National Press Club. The conference theme is: “A New FCC and a New Communications Act: Aligning Communications Policy with Marketplace Realities.”

A “New FCC” refers to the fact that the agency has a new Chairman and a new Commissioner. Whenever the agency is reconstituted, especially with a new Chairman, there is an opportunity for a fresh start, for changing course. A “New Communications Act” refers to the House Commerce Committee’s recently-initiated effort to review and update the Communications Act. And “Aligning Communications Policy with Marketplace Realities” refers to…well, just go back to the timeline sketched out above.

So, at Tuesday’s conference, we will be discussing what a new FCC and a new Communications Act may mean for communications law and policy – and not just what they maymean, but also what they ought to mean. After all, for a think tank that proclaims “Because Ideas Matter” in its logo – and which has confidence this is true – the “ought” is most important of all.

Take a quick look at the agenda. I’m sure you will be convinced that the conference promises to be interesting, informative, and lively. In addition to the keynote sessions with FCC Commissioners Mignon Clyburn and Michael O’Rielly and FTC Commissioner Maureen Ohlhausen, the two panels are packed with nationally-prominent law and policy experts of all stripes. Both panels will be conducted in a lively Q&A conversational format, with no initial presentations…and no filibustering!

In order to attend the conference, please register here. You must register to attend. Because there is no charge to register, I cannot offer a money-back guarantee. But I pledge that if you do attend, when you leave you will know a lot more about what a new FCC and a new Communications Act may mean – and what they ought to mean – than when you arrived.

I hope to see you on Tuesday. And, as always, we appreciate your support for the Free State Foundation’s programs.

[Originally published at Free State Foundation]
Categories: On the Blog
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