Archive for May 2005

A Blow for Competition

Just yesterday, I wrote in this post how depression-era alcoholic beverage laws meant to curb organized crime were being used by governments to protect local businesses from competition.  Today, the Supreme Court took aim at one such practice:

A Supreme Court decision Monday means that Missouri and Illinois
consumers soon will have access to a wider selection of wines and that
wineries in both states will be able to expand their consumer base.

In a 5-4 ruling, the court declared unconstitutional state laws that
prohibited out-of-state wineries from directly shipping wine to
consumers, yet allowed in-state wineries to do direct shipments. The
court said the laws unfairly discriminated against out-of-state

Congratulations to the Institute for Justice, one of the few groups out there protecting property rights and individual freedoms in the commercial arena.  Now, if only the Supreme Court would take on laws protecting car dealers from competition.

Postscript:   While major industries change from region to region, nearly every town or city of any size has influential local business owners in three areas who tend to have an unduly large influence on local politics:

  • Media owners (newspaper, radio, TV station owners)
  • Car Dealers
  • Beverage wholesalers (Coke, Pepsi, Miller, A-B, etc.)

While at the national level, government may be more focused on shoving subsidies at dairy farmers and Archer-Daniels-Midland, local and state governments love to protect incumbants in these three industries from competition (particularly in small to medium sized cities), who in turn donate tons of money (or in the case of media, in-kind exposure) to the politicos.

Not the Comfy Chair! (Updated)

Well, Newsweek has admitted that it screwed up.  Big time:

WASHINGTON (Reuters) - Newsweek magazine said on Sunday it
erred in a May 9 report that U.S. interrogators desecrated the
Koran at Guantanamo Bay, and apologized to the victims of
deadly Muslim protests sparked by the article.

Editor Mark Whitaker said the magazine inaccurately
reported that U.S. military investigators had confirmed that
personnel at the detention facility in Cuba had flushed the
Muslim holy book down the toilet.

The report sparked angry and violent protests across the
Muslim world from Afghanistan, where 16 were killed and more
than 100 injured, to Pakistan to Indonesia to Gaza. In the past
week it was condemned in Egypt, Saudi Arabia, Bangladesh,
Malaysia and by the Arab League.

On Sunday, Afghan Muslim clerics threatened to call for a
holy war against the United States.

"We regret that we got any part of our story wrong, and
extend our sympathies to victims of the violence and to the
U.S. soldiers caught in its midst," Whitaker wrote in the
magazine's latest issue, due to appear on U.S. newsstands on

It is not Monday morning quarterbacking to say that they should have known better -- many observers noted the danger right off the bat of posting such an inflammatory story based on only a single anonymous source.

The point I want to make is a different one than the obvious MSM-continues-to-slide-into-the-abyss observation.  That is:  We really, really seem to have dumbed down the whole "torture" thing.  When I grew up, torture was pulling out someones fingernails or whacking their genitals with a stick while they were tied to a cane chair or maybe starving them in a pit for a few weeks. 

Here is my fervent hope:  If I ever find myself imprisoned by hostile forces, I pray that they will torture me by sitting me in a chair and having me watch them flush books down the toilet.  The toughest part will be acting like I am really suffering watching a copy of some document I respect, maybe the US Constitution or Atlas Shrugged or the latest Sports Illustrated Swimsuit issue, swirling down the pipe.  Then, if that does not work, I hope and pray that they then resort to stripping me naked and taking pictures of me in a human pyramid with other prisoners.  I just hope they don't find out that I already did something similar in college.

By the way, while we are inventing a kindler-gentler torture, can we also tone down our dedication to icons?  I have never understood the need to ban Koran flushing or American flag burning.  Both the Koran and the flag are symbols that have meaning to each individual.  If someone wipes their butt in public with the American flag, my  respect for the US and what it stands for is in no way tarnished - only my opinion of the flag-wiper has changed.

UPDATE:  WOW!  How did I miss this one?  I really, REALLY hope they choose this torture for me:

One female civilian contractor used a special outfit that included a
miniskirt and thong underwear during late-night interrogations with
prisoners, mostly Muslim men who consider it taboo to have close
contact with women who aren't their wives...

The female interrogator wanted to "break him," Saar adds, describing
how she removed her uniform top to expose a tight-fitting T-shirt and
began taunting the detainee, touching her breasts, rubbing them against
the prisoner's back and commenting on his apparent erection....

In November, in response to an AP request, the military described an
April 2003 incident in which a female interrogator took off her uniform
top, ran her fingers through a detainee's hair and sat on his lap. That
session was immediately ended by a supervisor and that interrogator
received a written reprimand and additional training, the military said.

Please, no.  Anything but that.  Las Vegas better watch out or it may start losing visitors to Gitmo.  I wonder if this is going to cause a problem for the ACLU, which has been opposing these interrogation techniques at Gitmo.  After all, doesn't this woman have a right to free expression?

Postscript:  By the way, I am serious that I think the media has purposefully dumbed-down the definition of torture to improve their story, and in the process has hurt the US internationally.  However, while I find most of the torture accusations a joke, I still absolutely oppose the whole Guantanamo Bay indefinite detention camp concept.  I don't like allowing US authorities to set up a civil-rights-free zone, and I think it is an incredibly slippery slope that we are climbing on.   And yes, I say this with full knowlege that some bad folks could be released back into the wild.  Guess what -- the American justice system does this all the time.  We have 200 years of history of preferring to let guilty parties go free rather than letting innocent parties rot in jail, and I am not ready to overturn our pretty succesful precendent on this matter.

UPDATE: And to be clear, this is torture, or close enough.  Its good these folks are being brought to justice.   I encourage the media to keep up the pressure on true misconduct -- the gratuitous "wrapped-them-in-the-israeli-flag non-tortures just dillute our focus.  I guess I would also encourage those of you who want to extrapolate from these events to a condemnation of the US military as a whole to inform yourself.  The US military, like any institution of human beings, has criminals in it.  However, that being said, our military has been by far the best behaved occupying force in history, bar none (And, if you don't think they should be occupiers at all, well, blame the politicians that sent them).  For every story of atrocious behavior by a US soldier are 20 stories of soldiers being fair and kind.  The fact that these 20 other stories don't make the paper doesn't make them any less true.

Whats on My Desk

The original purpose of this blog was to pass on my experiences and lessons-learned running a small business.  Over time, though, since I have the attention span of an 8-year-old boy mainlining Hershey bars, I have gone many different places with this blog, well beyond day-to-day experience of a small business.

However, today I will return to this original goal, at least for one post, by asking the question "what's on my desk this morning?"  I tackle this question for two reasons.  First, it is interesting to compare how different the issues I struggle with day-to-day are as compared to my previous life as an executive at several Fortune 50 companies.  I am sure I did more, but all I can remember from my daily activities at large companies seems to involve either working on PowerPoint presentations or traveling to give them to somebody.  The second reason for visiting the contents of my desk is to reinforce my usual libertarian political points, which I think will be made sufficiently obvious just in the description of my to-do list that I won't need to editorialize further.

So here is what's got to get done today [ed note -- while published on Sunday, this is based on my worklist on Friday morning, May 13.]

  • Sales tax returns have to be completed, which I usually do myself.  We file monthly returns in six states, but one of those is Florida, where we have to file multiple returns county by county.  This month I also must complete a lodging tax return for two counties.  If it was the end of the quarter, an additional three state returns and two county returns would be due.
  • We are nearly completed with a sales tax audit from Washington state.  I have written before how complicated the WA sales tax return is, but the funny part was seeing a trained tax accountant from the state of Washington sit in my office for nearly 6 hours and still not be able to figure out how much tax I owed.  She kept encountering crazy exceptions like "such-and-such county requires 2% lodging tax unless the facility has more than 63 rooms or campsites and then it owes 50 cents per room-night except if it is in the Seattle convention district where it owes an additional .25% or if it is on a metro bus line where ... etc."  When tax law is too complicated for the paid employees of the tax department to figure out, it is too complicated.  Wonder of wonders, though, we may get a refund!
  • Also sitting on my desk from Washington is a notice that I did not pay my leasehold excise tax last year.  For those who don't know what that is, it is a way that states like WA and CA effectively charge property tax on the US government, evading the federal rules against such (basically, I have to pay the tax for the Feds, and then I take it out of the rent I bid to the Feds).  Actually, though, I did pay it.  Well in advance of the due date.  The state has spent the last 2 weeks trying to decipher their own records, and so I need to call them back today to see if they have figured everything out yet.
  • The department of Health in one California county is holding up my building approval because the condensate line from a refrigerator condenser coil runs out and drips fresh water on the ground (about a gallon a day).  If you have an air-conditioning system at your home, it is very very likely your air conditioning condenser does the same thing.  Unfortunately, the county wants this to run into the sewage system.  Why the county wants extra load on the sewer system, I don't know, but fortunately my builder caught this early so the change won't cost us much money.
  • Speaking of inspections, the ADA inspector at another California facility ruled yesterday that our sales counter was an inch too high and our ramp a half-degree too steep to the front door, so I spent part of this morning already getting the original contractor out there to tear these improvements out and redo them.  Interestingly, we previously had the bathroom that was originally in this modular building ripped out, because it could not be made ADA compliant.  This was not a big headache for our employees, because there is a public bathroom building next door.  However, the local health inspector is now reluctant to approve the building because... it has no bathroom and hand-wash sink.  The only food we sell is packaged (think Twinkies) but some health inspectors still want you to follow the same requirements as if you were a restaurant.  I am not sure how we are going to resolve this.
  • I just got a call from a customer who was mad that the county Sheriff would not respond to several complaints about drunk and disorderly conduct in the early morning hours at one of our campgrounds.  A few of our campgrounds, like this one, are too small to justify a live-on-site staff, and the rowdies seem to get the word out which campgrounds do not have on-site security.  I promised the customer a refund, and made a note to myself to talk to our manager about having one of our employees come by a few times in the night on a security sweep.
  • I have a meeting at 3:00 to meet with my accountant to finish up our income taxes.  Since we have to file a federal, 9 state, and a number of county tax returns, our total company return fills two 3-inch binders.   Today we are trying to sort out the depreciation schedule, which in and of itself is hundreds of pages long given that we have so many small assets.
  • We are still trying to get a liquor license approved for our store on Lake Havasu.  The whole liquor license process is one of those funny holdovers.  Coming out of prohibition, most states wrote tough procedures to make sure that the organized crime figures who control liquor during prohibition did not receive licenses.  As a result, to get a license, my wife and I and my managers have to be finger-printed and have FBI background checks.  The applications tend to be long and tedious and small errors cause the application to be returned for corrections. Worse, though, I have found that many towns use the licensing process as an anti-competitive protection for incumbents.  In California, if a County is "over its limit" (set fairly arbitrarily) in terms of licenses, it requires the county board of supervisors to meet and approve the new license.  In one California county I was told that this was really for my protection - they are protecting me from getting my business in a situation where I might fail due to too much competition.  Anyway, I suspect that the strong powers-that-be in Lake Havasu City may be holding up our license, and I need to try to figure out what is going on,though I am not sure how to go about it.
  • While I have been writing this, I got a call from a county DA in Arizona.  Most states have bad check programs where, if you have a bounced check and can't collect, you turn it over to the courts and they seek collection.  In extreme cases, they will arrest and try the offender.  I have never been entirely comfortable with this situation.  Sure, bounced checks irritate the heck out of me, but arresting people for a $20 bounced check feels like sending someone to a Victorian debtors prison.  This morning, I spent about 30 minutes trying to talk the DA out of prosecuting the heck out of some guy who claims that he paid us and we lost his check.  I give his story about a 30% possibility, but whatever is the case I have no desire to prosecute the guy.  The DA's blood is up, so it takes me a while to talk him out of it.  I am adding to my worklist something I have put off for a while, which is to investigate 3rd party NSF check collection. 
  • My bank just called and still needs yet more paperwork before they can complete an equipment financial loan.  AAARRRRGGGG. 
  • I just finished my annual rant with Arizona Game and Fish about fishing licenses.  We sell fishing licenses at a number of locations.  We only sell fishing licenses, we don't sell hunting licenses or duck stamps or all kinds of other special licenses that the state seems to sell.  Unfortunately, if you are a Game and Fish registered license seller, you can't get just fishing license inventory from them.  You have to take their full range of licenses, which they send you piles of in January.  We take all this stuff we don't want to sell and put it in the safe, and hope that we can keep track of it for the next 12 months.  If we somehow misplace anything and don't return it the following year, we pay for it (and some of those stamps and licenses cost hundreds of dollars).  Many of you  will recognize that this practice of the state government would in many situations be illegal for a private company.  There are many laws out there that limit a manufacturers ability to force a retailer to carry their full line of inventory, or worse, their ability to send the stores a bunch of inventory they did not order.
  • I have been putting off registering our 15+ trucks in Washington, but I am going to have to get to it today or this weekend.  Last year Washington passed a law that vehicles had to be registered with an in-state physical address (no PO Box).  I am not sure if this is a tax or terrorism thing, but it is obviously awkward for an out of state corporation, so they have finally relented a bit and said that you can still have to have an in-state physical address but they will mail paperwork to an out of state address.  I or my assistant will need to spend a couple of hours soon typing in two addresses each on all these vehicles before we can register them.

There are a million other things going on, but that is what is burning me up today.  In fact, since I have been spending the last hour writing this post, these tasks will probably also be occupying me this weekend.  An alien from another planet in reading this post might question whether I am really working for myself or this "government" entity.

Revisiting Nuclear Power

The NY Times has an article on a growing but still small minority of environmentalists who are ready to revisit nuclear power:

Several of the nation's most prominent environmentalists have gone
public with the message that nuclear power, long taboo among
environmental advocates, should be reconsidered as a remedy for global

Their numbers are still small, but they
represent growing cracks in what had been a virtually solid wall of
opposition to nuclear power among most mainstream environmental groups.
In the past few months, articles in publications like Technology
Review, published by the Massachusetts Institute of Technology, and
Wired magazine have openly espoused nuclear power, angering other
environmental advocates...

In his article, Mr. Brand argued, "Everything must be done to increase
energy efficiency and decarbonize energy production." He ran down a
list of alternative technologies, like solar and wind energy, that emit
no heat-trapping gases. "But add them all up," he wrote, "and it's just
a fraction of enough." His conclusion: "The only technology ready to
fill the gap and stop the carbon-dioxide loading is nuclear power."

While I am more of a warming-skeptic than most (see here, among others), I made this same plea for reconsidering nuclear power a while back.  However, a different regulatory approach (not laxer, just different) will be required:

If aircraft construction was regulated like nuclear power plants,
there would be no aviation industry.  In the aircraft industry,
aircraft makers go through an extensive approval and testing process to
get a basic design (e.g. the 737-300) approved by the government as
safe.  Then, as long as they keep producing to this design, they can
keep making copies with minimal additional design scrutiny.  Instead,
the manufacturing process is carefully checked to make sure that it is
reliably producing aircraft to the design already deemed safe.  If
aircraft makers want to make a change to the aircraft, that change must
be approved with a fairly in-depth process.

Beyond the reduction in design cost for the 2nd airplane of a series
(and 3rd, etc.), this approach also yields strong regulatory benefits.
For example, if the
in a particular aircraft, then the government can issue a bulletin to
require a new approved design be retrofitted in all other aircraft of
this series.  This happens all the time in commercial aviation.

One can see how this might make nuclear power plant construction
viable again.  Urging major construction companies to come up with a
design that could be reused would greatly reduce the cost of design and
construction of plants.  There might still be several designs, since
competing companies would likely have  their own designs, but this same is true in aerospace with Boeing, Airbus and smaller jet manufacturers Embraer and Bombardier.

Thank Goodness for Those Editors

Its good that unlike us poor, mistake-prone bloggers, the major media outlets have multiple layers of editing.  Otherwise, they might make mistakes even worse than putting Tbilisi, Georgia near Atlanta, as did our "worldly" local paper, the AZ Republic.  (Hat tip:  WSJ Best of the Web$)

Well, at Least I am Consistent

Via Professor Bainbridge, here is a nice Friday distraction for you -- a test via Philosophy magazine called Taboo.  Here are my results:

Your Moralising Quotient of 0.00 compares to an average Moralising Quotient
of 0.29. This means that as far as the events depicted in the scenarios featured
in this activity are concerned you are more permissive than average.

Your Interference Factor of 0.00 compares to an average Interference Factor
of 0.15. This means that as far as the events depicted in the scenarios featured
in this activity are concerned you are less likely to recommend societal
interference in matters of moral wrongdoing, in the form of prevention or
punishment, than average.

The test basically gauges wether you think an action can be immoral if no one is harmed, or if no one but the individual actor is harmed.  Its making a point that libertarians often make, and I made more generally here about respecting individual decision-making.  The distinction between immoral and yukky is also useful.  However, the nature of the questions reminds me of this funny bit by libertarian Dave Berry about libertarianism, sex, and dogs (scroll down):

John Dorschner, one of our staff
writers here at Tropic magazine at The Miami Herald, who is a good friend of mine
and an excellent journalist, but a raving liberal, wrote a story about a group
that periodically pops up saying that they're going to start their own country or
start their own planet or go back to their original planet, or whatever. They
were going to "create a libertarian society" on a floating platform in the
Caribbean somewhere. You know and I know there' s never going to be a country on
a floating anything, but if they want to talk about it, that's great.

wrote about it and he got into the usual thing where he immediately got to the question
of whether or not you can have sex with dogs. The argument was that if it wasn't
illegal to have sex with dogs, naturally people would have sex with dogs. That
argument always sets my teeth right on edge.

And I always want to retort
with, "You want a horrible system, because you think the people should be able to vote
for laws they want, and if more than half of them voted for some law, everyone
would have to do what they said. Then they could pass a law so that you had to
have sex with dogs."

Postscript:  By the way, I consider myself profoundly moral.  I just don't tend to apply morality to situations where an actors actions affect only themselves, or other via mutual consent.  More on this in another post.


Review for Star Wars III

First, I must confess that I have been to opening day of every Star Wars movie, and I have tickets for opening day of this last one.  Yes, I am kindof a geek, but no, I am not a total geek:  I did not sit up all night in line or anything for these movies. 

This is actually a bit of an accomplishment, because I don't think many people saw the original Star Wars movie on the first day.  One thing that I think a lot of people don't remember, given all the Star Wars hype and success, is that the original movie opened without much hype or expectations.  I was with my family visiting LA, where we were staying in some hotel in Century City  (maybe the Century Plaza - I remember it seemed pretty nice).  Anyway, my dad was on business and my mom and sisters were shopping so I walked over that morning to see what was playing at the Century City movie theater.  It was in that way I accidently saw the first showing on the first day of the original Star Wars.  It was me and about 7 other people in that huge theater.   I was so blown away that I stayed for a second showing.

Anyway, time passes.  Empire Strikes Back was great.  I thought at the time that Return of the Jedi was pretty mediocre, but that was before I saw Clone Wars which I thought was visibly stunning but really bad.  I cringed every time there was any substantial dialogue, particularly  when Padme was on the screen.

Anyway, I take this review pretty seriously, because they seem to have had the same reactions I had to the previous movies.  The Good news:  visually even more stunning, cool fight scenes, and a better all around movie than the other prequels.  The Bad news:  the Padme dialog still sucks, maybe even worse.

I really enjoyed watching Revenge of the Sith. And yes, it is quite a good film.
However, the scenes with Padmé alone are enough to give you flashbacks of the
worst parts of the first 2 sequels, and thus lower your overall enjoyment ofthe

Still... it is a strong film with a strong story, great effects and much
improved dialog (with the exception of anything with Padmé in it). Star Wars
fans should be quite happy... and non-Star Wars fans will enjoy as well.

Overall... I give Revenge of the Sith a solid 7 out of
(would have been a 9 if they just totally took out Padmé or
re-wrote all her pathetic dialog).

It gets much worse treatment in other venues, but for roughly the same reasons.

UPDATE:  Here is my review

By the way, Darth Vader has a blog now.  We learn a lot from it about the daily trial and tribulations of being a dark jedi master (thanks to VodkaPundit for the link):

Due to the haste with which we are proceding through the
latter phases of this battle-station's construction we have been forced to
employ scores of civilian contractors from across the galaxy in addition to our
own Imperial Corps of Engineers. This had led to a certain clash of working

For instance, this morning I critiqued a tragically sub-par
piece of workmanship on a tractor-beam repulsolift inversion assembly by
snapping the neck of the site supervisor and throwing his limp corpse down a
disused elevator shaft.

Imperial engineers would have snapped to crisp
attention, of course, but all these civilian contractors did was give me was
grief. "Oy, you do that again and I'll have the union on you!" barked one
red-faced buffoon.

"It is vital that you enhance the inter-departmental
syngergies of your operation," I said. And then I killed him.

I can relate.

Actual Expert Too Boring for TV

The Onion has a dead-on spoof of how major media selects "experts" for their articles.  The spoof is worth reading in total, but to give you a taste:

Dr. Gary Canton, a professor of applied nuclear physics and
energy-development technologies at MIT and a leading expert in American
nuclear-power applications, was rejected by MSNBC producers for being
"too boring for TV" Monday....

"[Canton] went on like that for six... long... minutes," ...
"Fact after mind-numbing fact. Then he started spewing all these
statistics about megawatts and the nation's current energy consumption
and I don't know what, because my mind just shut off. I tried to lead
him in the right direction. I told him to address the fears that the average citizen might have about nuclear power, but he still utterly failed to mention meltdowns, radiation, or mushroom clouds."...

MSNBC chose Skip Hammond, former Arizona State football player, MBA holder, and author of Imprison The Sun: America's Coming Nuclear-Power Holocaust. Hammond is best known for his "atomic domino" theory of chained power-plant explosions and his signature lavender silk tie.

"Absolute Armageddon," Hammond said when asked about the dangers
increased reliance on nuclear power might pose. "Atoms are not only too
tiny to be seen, they're too powerful to be predicted. Three Mile
Island? Remember it? I do. Don't they?"

"Clouds of radiation, glowing rivers, a hole reaching to the earth's
core"”that's what we're facing, " Hammond continued. "Death of one in
four Americans! Count off, everyone: one, two, three, you. Millions of people gone. And no one's even mentioned terrorism yet. You have to wonder why not."

According to [MSNBC], Hammond was "perfect."

Dead-on.  Tell me you haven't seen this exact type of thing in stories on nuclear power, biotechnology, genetically modified crops, global warming, breast implants, Vioxx, etc etc.


GWB seems to have riled lots of folks up over his reference in a recent speech to Yalta.  If you have read any of the comentary from the left, you might be imagining he said all kinds of wild things.  I read much of the commentary before I ever read Bush's words, so I was prepared for a real gaffe.  After reading his speech, I was left wondering if those attacking Bush heard the same speech.  Here is the key paragraph:

As we mark a victory of six days ago -- six decades ago, we are
mindful of a paradox. For much of Germany, defeat led to freedom. For
much of Eastern and Central Europe, victory brought the iron rule of
another empire. V-E Day marked the end of fascism, but it did not end
oppression. The agreement at Yalta followed in the unjust tradition of
Munich and the Molotov-Ribbentrop Pact. Once again, when powerful
governments negotiated, the freedom of small nations was somehow
expendable. Yet this attempt to sacrifice freedom for the sake of
stability left a continent divided and unstable. The captivity of
millions in Central and Eastern Europe will be remembered as one of the
greatest wrongs of history.

I am not sure how you can disagree with this.  I think the US owes Eastern Europe a big appology for selling them out at Yalta.  Now, one can argue that we had some reasons for our actions at Yalta.  First and foremost, we were exhausted from the worst war in history, and no one had the energy to gear up for a new confrontation.  Also, one can argue that it may be 20/20 hindisght that causes us to be more aware of Soviet hegemonic intentions than the actors at the time might have been (though certainly Churchill was fully cognizant of the dangers).  But, no matter how you cut it, small countries like Latvia were wiped out of existance and handed over to the Soviet Union by the Yalta agreement, and Bush's audience was made up of people still stung by this.  I think the comparison to Munich is very apt - the US post-WWII was exhausted and was more than ready to suspend disbelief and hope that appeasing Soviet territorial ambitions would head off a fresh confrontation no one had the will to fight.  Reason's hit and run has a nice roundup and further analysis.

The only explanation I can come upfor the uproar is that FDR, like Reagan and Kennedy, has an incredibly powerful though informal legacy protection society that leaps into action at even the smallest attempt to besmirch his historical halo.  In this case, Bush rightly does not even mention FDR; however, since FDR was the main advocate for pandering to Stalin at Yalta (against Churchill's vociforous but ultimately ignored objections), his defense forces feel the need to jump into action.  I would have hoped that with 3 generations separating us from FDR, we could finally look at him objectively.  He fought a fabulous war, in some sense carrying the whole free world on his shoulders for four years.  But he fumbled the peace, though, and screwed up at Yalta.

UPDATE:  Professor Bainbridge has this nice quote from Latvian President Vaira Vike-Freiberga a few days before Bush's speech:

In Latvia ... the
totalitarian occupation ... of Nazi Germany was immediately replaced by
another "“ that of Stalinist totalitarian communist Soviet Union and was
one that lasted a very long time. The day we shall be commemorating
does have double significance and by coming to the Baltic States
President Bush is, I believe, underscoring this double meaning of these
historic events. 60 years ago when the war ended it meant liberation
for many, it meant victory for many who could truly rejoiced in it.

But for others it meant slavery, it meant occupation, it meant
subjugation, and it meant Stalinist terror. For Latvia the true day of
liberation came only with the collapse of the Soviet Union as it did
for our neighbours Lithuania and Estonia.

Sounds a lot like what Bush said.  Seems like Bush is in pretty good touch with the sentiments of the Latvian people he is speaking to.


Will the Airport Police Publish the Contents of Your Luggage?

NFL running back Onterrio Smith was apparently detained at the Twin Cities airport for possessing a device used to beat drug tests:

A search of a bag Smith was carrying April 21 turned up several
vials of dried urine and a device called "The Original
Whizzinator," which includes a fake penis, bladder and athletic

Lets be clear on this - the device, is as far as I know completely legal.  Mr. Smith is not even in violation of NFL rules for possessing one in an airport - only actually strapping this bad boy on in an actual drug test would violate rules.  Apparently the police mistook the vials of dried urine for cocaine (I can already picture a future Will Farrell movie with a scene based on such a mix up).

Here is what scares me - why do we know about this?  Once it was determined that Mr. Smith did not possess any illegal devices or substances, he should have been left to go on his way.  Why are the airport police handing this story to the press?  Why were Mr. Smith's employers in the NFL notified?  Why isn't Mr. Smith and the contents of his luggage owed privacy?  What's next, stories about famous women found with vibrators in their luggage?


Classic Moral Hazard

According to the WSJ($), you and I are going to take on the pension obligations of UAL:

A bankruptcy judge approved a
proposal from United Airlines parent UAL Corp. to transfer four
underfunded employee pension plans to the federal government, paving
the way for the largest pension default in U.S. corporate history.

The plans, which have a shortfall of $9.8 billion,
cover more than 120,000 United workers and retirees. United, the
nation's second-largest carrier in terms of traffic, wants to transfer
them to the federal Pension Benefit Guaranty Corp., or PBGC, which
would add to the already heavy strain on the agency from a spate of
pension defaults in recent years. Since accounting for United's
obligations last year, in anticipation it would assume them, the agency
has taken on obligations exceeding its assets by $23.3 billion  [ed note- the agency takes in only about $1 billion a year in premiums, so $23.3 billion in the hole is a very big number]....

The court's decision could have wide
repercussions in the airline industry, which is struggling with high
fuel costs, intense fare competition and overcapacity. Sidestepping its
pension liabilities will help UAL attract additional funding, while
giving it a huge cost advantage over many of its rivals, which are
saddled with underfunded defined-benefit retirement plans of their own.
That will put further pressure on those airlines to slash their costs
or in some cases seek bankruptcy protection in hopes of terminating
their own pension plans.

It is difficult for me to even start on how much this pisses me off.  These pensions are real obligations that UAL took on, and represent value provided in exchange for work that has already been done.  As outlined below, I am not big on the defined benefit pension model, but that does not change the fact that these companies are defaulting on a solemn obligation.  The temptation I guess is always great when finances get tight to defer obligations that are the farthest in the future, and so pension underfunding is one of the first things to occur.  There is no way management should get a pass for this, and I am flabbergasted that equity holders expect to retain anything out of the bankruptcy when employees have not been fully paid.

This being said, there is plenty of blame to go around, including for the union and the government.  The UAL unions should have been dropping the hammer on the company in the form of strikes or whatever at the first sign of under-funding.  Instead, they were more concerned about jacking up their salaries to the highest levels in the industry, ignoring the reality that airline finances by the late 90's were basically a balloon that if you pushed on it in one place, it popped out in another.  Unions allowed the underfunding to continue in large part lulled by the promise of the PBGC and taxpayers to make the pension funds whole if they continued to be underfunded.  This is the moral hazard that occurs in any kind of financial insurance like this, and the unions apparently were both right and wrong - we taxpayers will take on the obligations but their benefits will also get a haircut.

One of the lessons I thought was learned from the S&L bailouts of the 90's was that you can't provide such financial insurance without a parallel regulatory structure to make sure some kind of minimum fiduciary responsibility exists.  But, not learning a thing, the government has this pension guarantee program in place and exercises virtually no oversight over the funding or management of the insured pensions.

It is astounding to me that a large number of people still support defined benefit plans over defined contribution plans. What I don't honestly understand is why the rank and file still buy into this.  Defined contribution plans are much easier to monitor and audit and keep companies honest.  Once the money is in a vehicle such as a 401K, the money can't be taken away by the company or lost in a bankruptcy (unless the 401K is invested in the company's stock, which any adviser will tell you to never, ever do (see "Enron").  Now, I understand that there can be some tricky migration issues from one system to another, and companies use the transition as an excuse to cut back on their net contributions, but these are workable and negotiable issues .  My guess is that the support for defined benefit plans comes mainly from union leadership, since these plans give
them control of huge amounts of funds and thereby gives them extra
power (see Teamsters for the classic example, or more recently, the situation at Calpers).  I wrote more on this topic here.

The issues here are surprisingly similar to the Social Security debate, as discussed here.  Would you rather have the money in your own account, despite the fact you will then have to bear market risks, or would you rather the money remain in the hands of your company or your Congress.  In entirely parallel situations, money entrusted to UAL management and to Social Security has all been spent, with nothing now left to pay retirees. 

Update:  It just occured to me to ask - why don't frequent flyer mile holders ever have to take a haircut in an airline bankruptcy?  We frequent flyers are creditors too, holding a claim on the company in the form of our miles.  In fact, I would think my claim as a holder of miles is much much worse than other creditors.  For example, why should employees have their pensions cut before I get my miles account cut?  Heck, employees seem to have a much better claim than I do, especially since many of my miles were earned, like everyone else's, as marginally ethical kickbacks directly to me for influencing my employer's spending on air travel.  Despite this, it appears that pensions will be cut, and salaries will be cut, and bondholders will lose value, and stockholders will be diluted, but my miles will all still be good.

Update #2: Assymetrical information has a nice post along the same lines, pointing out an issue with corporate defined benefit pensions that I forgot to mention:  If you are 20 years old with a company, are you really willing to make a bet that your company will even exist in 60 years to pay off your pension?  Not to mention the portability issues, since few people remain with the same company to retirement.  I think I actually have a couple of defined benefit pension plans I am vested in from early in my career - one from Exxon, when I was about to quit to go back to school and was offered, due to poorly structured plan rules, the chance at early retirement instead.  I think I qualify for like $1.23 a month for life from that plan.

More also from Will Collier:

I don't mean to tread on Martini Boy's turf here, but the pensions
crisis among all of these old-line companies illustrates a great no-no
of long-term investing: lack of diversification. In the end, even
though they presumably didn't have much choice in the matter, all those
UAL employees who've been promised a defined-benefit pension are in the
same boat as the Enron and WorldCom employees who voluntarily put all
of their 401(k) money in their own company's stock. They bet the house
on one horse, and by they time old age caught up with the grizzled nag,
there was barely enough left of it to cart off to the glue factory

Kevin Drum also points out that these defined-benefit funds are easy to manipulate, since managers can play with the "expected returns" variable to change the necesary annual contribution. 

Why do So Many Libertarians Blog?

A few weeks ago, in an interview about blogging, I was asked "why are there so many libertarian bloggers?"  My answer didn't make the final cut for the article, but I thought it was worth repeating here**:

First, I am tempted to answer with a variation of the argument that the left uses to justify why so many academics
are liberal "“ ie, that we bloggers are all smarter and therefore libertarians.  I will eschew that one though, because I think the real reason is that libertarians have never had a really good outlet for our opinions and it is a relief to have a channel to be able to express our views without distortion. 

Part of this is because there are few good organized outlets for libertarians.  In the past, libertarians could perhaps find a voice in one of the two major parties, but that tends to just end in frustration as about the 50% of what either party espouses is inconsistent with a true respect for individual liberties.  At the same time, the formal libertarian party has often been a joke, fielding some pretty bizarre candidates with some pretty niche priorities.

However, a major part of the problem is that libertarianism resists organization.  Libertarianism tends to be a big tent that attracts everything from anarcho-capitalists to Cheech-and-chong-esque hempfest organizers to Larry-Flint style pornographers.  For this reason, libertarianism defies efforts to brand it, which is a critical shortcoming since the two major political parties nowadays are much closer to brands than ideologically consistent philosophical alternatives. 

Libertarians revel in differences and being different.  Almost by definition, none of us have the same message, or even believe that we all should have the same message. Many of us are suspicious of top-down organization in and of itself.  Blogging is therefore tailor made for us "“ many diverse bottom-up messages rather than one official top-down one.

Finally, since libertarianism is really about celebrating dynamism and going in a thousand different directions as each individual chooses, in some sense the Internet and blogging are not only useful tools for us libertarians, but in and of themselves are inherently libertarian vehicles.  Certainly libertarian hero F. A. Hayek would recognize the chaos of the Internet and the blogosphere immediately.  For a good libertarian, chaos is beautiful, and certainly the blogosphere qualifies as chaotic.   The Internet today is perhaps the single most libertarian institution on the planet.  It is utterly without heirarchy, being essentially just one layer deep and a billion URL's wide.  Even those who try to impose order, such as Google, do so with no mandate beyond their utility to individual users.

When people are uncomfortable with the blog phenomenon, they tend to be the same people who are
uncomfortable with anything chaotic.  I have written several times, particularly here and here, that people across the political spectrum, from left to right, are united by an innate fear of and need to control chaos.  Conservatives don't like the chaos of themes and messages found in movies and media.  Liberals insist on a unified public education system with unified messaging rather than the chaos of school choice and home schooling.  Socialists hate the chaos and uncertainty of the job market, and long for guaranteed jobs and pensions.  Technocrats hate the chaos of the market, and seek to impose standardization.  Everyone in the established media hates blogs, which threaten to upset the comfortable order of how-we-have-always-done-things.

** Which just demonstrates another reason why we all blog- no editors!  There is a saying that a lawyer who represents himself has a fool for a client.  It may well be that we bloggers are in the process of proving a parallel adage about being our own editors.


Regulate Thyself

Arizona Watch has a great post today about our state government's foray into amusement park regulation after several folks were stuck on a local ride for a couple of hours. 

There are no major amusement parks in Arizona, although two large
ventures are apparently planned. Currently, inspections are handled by
insurance companies, who have a serious financial stake in maintaining
the safety of the rides. Insurers can't afford to have unsafe rides at
their client's amusement park. Compare that to the state, that has
exactly what at stake?

As an aside, Phoenix is an awful place for a roller-coaster and amusement park fan like myself to live.  Basically, we have no real amusement parks  (though there are some great ones about a 6-hour drive away in LA).  I have sat and pondered this a lot - why does a city this large with such a strong tourist economy not have a Six Flags type attraction?

The answer I guess is  that our season is wrong.  Our season is November-April, when the weather is nice.  Unfortunately, the kiddies are in school then.  During summer vacation months, Phoenix is a bit, uh, toasty (but its dry heat, as we tell our Thanksgiving turkey each year).  This answer is not totally satisfying, as uncomfortable summer cities like San Antonio and Houston have major theme parks.  Also, Phoenix has no real world class water parks (just a couple of places with 2 slides and a pool).  Maybe its because all the developpers here have golf courses on the brain.

Where do Phoenix people go for fun in the summer?  Well, if you are ever in San Diego or LA during the summer, check the license plates.  Then you will know where we are.

We Won't Respect You in the Morning

Again, small government libertarians like myself, who held their nose and voted Republican in the last election, have been used.  From the NY Post today:

THE Republican promise of smaller,
less-intrusive government is getting harder and harder to believe.
Especially when a more plausible plot line is unfolding every day: that
the GOP has put aside the ideals of Reagan and Goldwater in order to
pursue a political strategy based on big spending.

For the latest, check out a report just released by the
libertarian Cato Institute that tells a striking story about just how
out-of-control spending has gotten under President Bush.

Cato finds that:

* Bush has presided over the largest increase in federal spending since Lyndon Johnson.

* Even excluding defense and homeland security spending, Bush is the biggest-spending president in 30 years.

* The federal budget grew from 18.5 percent of the Gross
Domestic Product on President Bill Clinton's last day in office to 20.3
percent at the end of Bush's first term.

Add to that Bush's massive Medicare prescription-drug
benefit, expected to cost $720 billion-plus over the next 10 years.
(The money for that new entitlement, the first created by a president
in a generation, will start flowing this year.)

It is not in the least bit comforting to have my suspicions confirmed by Cato, whose whole report is here.  Bring back divided government!  I will take Reagan-Democrat Congress or Clinton-Republican Congress over this any day.


A Victory for Fair Use

Via Ernest Miller:

Civil and consumer rights groups have won in the Broadcast Flag case!...

...For those who are unfamiliar with the Broadcast Flag, it was ... it was a regulation promulgated by the FCC
at the request of Hollywood that would have required all HDTV receivers
to incorporate certain copy controls. Starting this July, all HDTV
receivers sold in the US would be required to enforce restrictions on
copying HDTV broadcasts that were tagged with the "Broadcast Flag."
Although you might be able to record HDTV shows, you wouldn't be able
to make additional copies for personal use (such as watching in another
room) without a lot of hassle, if it was possible at all, not to
mention taking a copy to watch at a friend's house. The ramifications
of this authority grab by the FCC were enormous, since it would have,
among other things, essentially given them the power to control
significant aspects of the design of anything capable of using HDTV
signals, i.e., modern PCs.

Good.  Now, will someone address letting me copy DVD's to play on a handheld, hard-disk based device like this one.

Perhaps the Best Reason for Private Accounts

Frequent readers will know that I have little patience with the argument against private Social Security accounts that goes something like "Americans are too dumb to be trusted with their own retirement funds".  Today, however, I am going to put that aside for perhaps a better question:

Can the government be trusted with our retirement funds?

This is the argument made by Brad DeLong and quoted in Marginal Revolution:

We need to raise our national savings rate. But if we just raise Social Security
taxes, Congress will treat these taxes as general revenue and spend them. Only
by funneling Social Security contributions into some vehicle that Congressional
representatives cannot interpret as a resource available to fund current
spending can we raise the national savings rate. And private accounts are the
best vehicle we can find to (a) accumulate contributions without (b) allowing
Congressional representatives to seize them as resources available to fund
current federal spending.

Congress has taken all the savings surpluses built up by Social Security over the past decades and it has spent them.  Republicans have spent the money.  Democrats have spent the money.  It is gone, spent on cruise missiles and welfare moms and ethanol subsidies and PBS broadcasts and snail darter studies.  No matter what verbal acrobatics people try to engage in to argue that there is a real "trust fund", the fact of the matter is that all that is in the Social Security till are IOU's that can only be redeemed by raising taxes. 

The situation with Social Security is entirely equivalent to having invested your money in a mutual fund and only later finding the directors of the fund spent your money on themeselves rather than investing it in redeemable securities.  The only differences are that:

  • The proprietors of that bogus mutual fund may go to jail, but Congress won't
  • Congress can raise taxes to get the money to bail themselves out of their malfeasance

Think of it this way: 

  • There were more real assets of value remaining in Enron in its bankruptcy to divide up among investors and creditors than remain in the Social Security "trust fund" to divide up among program contributors.
  • There were more real assets of value remaining in the Teamsters retirement fund after years of being raped by organized crime than remain in the Social Security "trust fund"

Stop handing over our savings to such unsavory racketeers (ie. Congress).  We certainly can't do a worse job for ourselves.

05 / 05 / 05

Happy Cinco de Mayo, because it is always good to celebrate independence from the French.  As you might imagine, this is a fairly big celebration down here in Arizona.

A bit of history, from the source above (I have added emphasis to a couple of lines I really liked)

The French had landed in Mexico (along with
Spanish and English troops) five months earlier on the pretext of collecting
Mexican debts from the newly elected government of democratic President (and
Indian) Benito Juarez.  The English and Spanish quickly made deals and
left.  The French, however, had different ideas.

Under Emperor Napoleon III, who detested the
United States, the French came to stay.  They brought a Hapsburg prince
with them to rule the new Mexican empire.  His name was Maximilian; his
wife, Carolota.  Napoleon's French Army had not been defeated in 50 years,
and it invaded Mexico with the finest modern equipment and with a newly
reconstituted Foreign Legion.  The French were not afraid of anyone,
especially since the United States was embroiled in its own Civil War.

The French Army left the port of Vera Cruz to
attack Mexico City to the west, as the French assumed that the Mexicans would
give up
should their capital fall to the enemy -- as European countries
traditionally did
. [ed.-- and as the French inexplicably did as recently as 1940

Under the command of Texas-born General
Zaragosa, (and the cavalry under the command of Colonel Porfirio Diaz, later to
be Mexico's president and dictator), the Mexicans awaited.  Brightly
dressed French Dragoons led the enemy columns.  The Mexican Army was less

General Zaragosa ordered Colonel Diaz to take
his cavalry, the best in the world, out to the French flanks.  In response,
the French did a most stupid thing; they sent their cavalry off to chase Diaz
and his men, who proceeded to butcher them.  The remaining French
infantrymen charged the Mexican defenders through sloppy mud from a thunderstorm
and through hundreds of head of stampeding cattle stirred up by Indians armed
only with machetes.

When the battle was over, many French were
killed or wounded and their cavalry was being chased by Diaz' superb horsemen
miles away.  The Mexicans had won a great victory that kept Napoleon III
from supplying the confederate rebels for another year, allowing the United
States to build the greatest army the world had ever seen.  This grand army
smashed the Confederates at Gettysburg just 14 months after the battle of Puebla,
essentially ending the Civil War.

Union forces were then rushed to the
Texas/Mexican border under General Phil Sheridan, who made sure that the
Mexicans got all the weapons and ammunition they needed to expel the
French.  American soldiers were discharged with their uniforms and rifles
if they promised to join the Mexican Army to fight the French.  The
American Legion of Honor marched in the Victory Parade in Mexico, City.


Viva Immigration

Sticking with the Cinco de Mayo theme, immigration has been a big issue of late down here in the Southwest.  Last election cycle Arizona passed a law limiting benefits to illegal immigrants.  This last few months have seen the "minuteman project", ostensibly to have private citizens help "defend the borders" and which got surprising support from America's most famous immigrant Arnold Schwarzenegger.

I have a number of friends who passionately support these efforts.  I am forced to say that not only do I disagree with them, I am actually embarrassed by the Minuteman project.  Michelle Malkin makes the argument that these are good people and not crazed racist KKK crazies.  OK, I am willing to accept this (for most of them) but this just makes it worse, wasting the patriotism and labor and time of people to such a wrong-headed end. (Matt Welch is less willing to believe they are just happy misguided soles).

At the end of the day, the vast, vast majority of people crossing the border are looking for a job.  That's it.  They are not terrorists or foreign spies or criminals -- they are ordinary people looking for a job, often to support their family.  This is why I find it an incredible waste that we have Arizona's private citizens, many of whom probably lament the slacker mentality of recent American generations of kids, standing around along the border making sure that people who are looking for a job in this country don't find one.

Of course, these Minuteman folks won't say that is what they are doing.  They are saying that they are:

  • Defending the borders.   A Government's job is NOT (repeat NOT) "defending its border".  A government's job is to defend its citizens.
    In 1939, if a country was next door to Nazi Germany, defending its
    citizens probably meant defending the borders.  Today, though, next to
    Canada and the Mexico with whom we have been at peace for 150 years and
    with whom we share a common market, its harder to argue that defending
    our citizens requires having a Maginot Line at the border.

I am sure that our southern border is vulnerable to terrorists crossing, but I am equally sure that the minutemen did not find a single one.  Here is the real problem:  Because we force Mexican immigration to cross illegally across the open borders, terrorists trying to use the same approach are masked by thousands of others crossing the border.  By making free passage of Mexicans across the border illegal, we shift them out of monitored border crossings and onto the frontier, where they mask true criminals and terrorists.  Think of it this way - would you rather try to find a single terrorist who is alone in an empty stadium or one of 60,000 people at a football game?

  • Enforcing the rule of law.  Maybe, but why not start with sitting beside the highway and writing down license plates of speeders too?  At the end of the day, enforcing current immigration law is as hopeless as was prohibition, the war on drugs, and enforcing the 55 mile-an-hour speed limit.
  • Protecting American jobs.  I would not be at all surprised to find a high degree of overlap between the Minuteman supporters and the anti-NAFTA crowd.  The fear that "immigrants might be willing to do your job for less than you are willing to do your job for" has always been a strong part of anti-immigration movements.  The fact of the matter, though, is that this takes a very static view of the world.  The economy is not a zero sum game with competition for a fixed number of jobs.  New sources of labor can spur economic growth that creates new jobs.  The best example of this was in the last three decades, where a totally new, sometimes unskilled, work force of 40 million people showed up at industry's door suddenly looking for work:  women.  I told the story here (towards the bottom of the post), but the bottom line is that these new workers made the economy stronger, and now, with a generation or two behind them in the work force, women are really the backbone of entrepreneurship today in this country.  Besides, if we don't allow companies to legally hire immigrant workers, businesses in this global economy will just pick up and move to Mexico.
  • Reducing cost of government services.  As a libertarian, I am very sympathetic to the argument that you don't want immigrants coming in and being able to immediately live off our safety net at taxpayers expense.  In my mind, though, this has historically been a problem of poorly crafted law rather than immigration per se.  It certainly would be possible to craft an intelligent immigration policy that allowed access to social services in steps.  By the way, shifting illegals into legal guest worker programs would likely increase tax revenues by bringing these folks into the system.
  • Preventing Hispanics from becoming the dominant ethnic group in the Southwest.  Yes, I am positive this is a concern of many of these folks, just as the Italians in Boston at one time were worried about being overrun by the Irish.  It barely dignifies a response, except to say that if you are really concerned with the number of permanent Hispanic residents, then a guest worker program might actually reduce the number.  The reason is that many Mexicans still love their country but want work.  If they were allowed to freely move back and forth, they would do so.  But, since the border is the riskiest point for them, once they get in the US, they are reluctant to ever leave again.

We have got to have an intelligent immigration policy that

  • Allows for free movement of guest workers across the border, with few limits on total numbers allowed. 
  • A clear and fair system for guest workers to move up over time towards full citizenship
  • A clear and fair system of tiered access to social services as immigrants progress from worker to citizen (e.g. emergency services access to all, but welfare/social security require full citizenship).
  • Includes a taxation system on guest worker labor that causes these workers to help pay for the services they use.

Kudos to Professor Bainbridge for breaking with the conservative ranks to support an intelligent guest worker program.  More here from Steven Taylor.

Postscript:  I want to propose a thought experiment.  Most everyone considered the Berlin Wall a travesty.  Now, keeping all the facts about East and West the same, make one change:  suppose the wall was built instead by the West to stem the flood of immigrants from the oppressive east.  Would the wall suddenly become OK?  Even if the reality on the ground for an East Berliner (ie they can't escape) remained unchanged?

Border walls in Nogales, AZ and Berlin, Germany:

Nogaleswall_1   Berlinwall

Oh, and from this site, here is the Montana-Canada border "wall" and a "checkpoint"

Canada  Canada2
But its not about race.


Really Lame

Volokh points out this bit of stupidity:

Family Research Council Opposing Vaccination:

New Scientist reports:

Deaths from cervical cancer could jump fourfold to a million a year
by 2050, mainly in developing countries. This could be prevented by
soon-to-be-approved vaccines against the [sexually transmitted HPV]
virus that causes most cases of cervical cancer . . . . [T]o prevent
infection, girls will have to be vaccinated before they become sexually
active, which could be a problem in many countries.

In the US, [however,] religious groups are gearing up to oppose
vaccination . . . . "Abstinence is the best way to prevent HPV," says
Bridget Maher of the Family Research Council, . . . [which] has made
much of the fact that, because it can spread by skin contact, condoms
are not as effective against HPV as they are against other viruses such
as HIV.

"Giving the HPV vaccine to young women could be potentially harmful,
because they may see it as a licence to engage in premarital sex,"
Maher claims . . . .

This is just wrong on any number of levels.  The lamest part of this, beyond the sheer wrongheadedness of it, is it strikes me as a sign that these religious groups are unsure of their own teachings and moral standing.  I will never be confused with a religious expert, but I would think that religious groups would be fighting for abstinence as a positive moral principal.  Trying to deny vaccinations in order to make sexual intercourse incrementally more dangerous and threatening strikes me as a sign that the religious groups have given up on moral teaching and are now relying on bald scare tactics. 

When my kids were about 2, we had trouble with them getting out of bed and coming into our room.  Increasing the likelihood of STD's in order to discourage sex strikes me as similar to if I had spread tacks on the ground around my kids bed to keep them from wandering around at night.  When we come up with an HIV vaccine, are these groups going to oppose that as well?


Conservatives Can Squelch Campus Speech Too

Campus liberals rightly get a lot of heat for their attacks on free speech and expression at universities via speech codes and the like.  I have piled on a number of times.  However, the impulse restrict speech you don't agree with is not limited to liberals (though it may be more prevalent due to leftist control of most campuses).  Take this story via Volokh:

Vince Finaldi points me to the affidavit justifying the arrest of a student for asking a rude question at an Ann Coulter speech.  If the facts in the affidavit are accurate, then it looks like the student has an excellent First Amendment defense.

Basically, the student asked Ms. Coulter her opinion of a married man and woman engaging in sodomy.  Granted that he asked the question in a fairly profane manner, but he seems to have followed the Q&A rules by getting up, asking his question, and quietly waiting for the reply from his seat.  So why are the police hauling him away?

The Teacher Salary Myth

"You took a teaching position, 'cause you thought it'd be fun, right?
Thought you could have summer vacations off...and then you found out it
was actually work...and that really bummed you out"

-- Carl to Vernon, in

Update May, 2015:  Since Jon Stewart raised the issue of Baltimore school under-funding, we look at the salaries of Baltimore school teachers.  Short answer:  On a full-year basis, Baltimore teachers start at over $61,000 a year, not including generous benefits.

If you go to the NEA web site, you will see that they argue that most of the problems in education boil down to either low teacher pay or overly high teacher productivity expectations (i.e. classroom size).  I fisked many of these claims here and here, but most media outlets still quote these assertions credulously when they write about education.

I have found (from some past emails I have received) that one of the ways to really irritate a teachers union rep is, when they lament their low salaries, to point out that they only work 9 months a year, and they should multiply their salaries by 1.33 to make them comparable to the rest of ours.  For example, per the NEA web site, teachers made a bit over $56,000 on average in California in 2004. Lisa Snell, in this month's Reason, estimates that benefits add nearly $16,000 to this compensation package, for a total of about $72,000 per year for California teachers.  Normalize this for the fact they work 9 months (or less) a year, and you get them making an equivalent of $100,000 a year.  Woe is me.

Of course, California is high vs. other states on salary, and the "9 months" estimate is only approximate, and doesn't count the fact that teachers typically work a shorter work week than many other professionals.  Fortunately, Snell pointed me to this article in Education Next, which has a fantastic rebuttal to the "teachers are underpaid" myth.

A substantial body of evidence implies that teachers are not underpaid
relative to other professionals. Using data on household median
earnings from the U.S. Department of Labor, I compared teachers with
seven other professional occupations: accountants, biological and life
scientists, registered nurses, social workers, lawyers and judges,
artists, and editors and reporters. Weekly pay for teachers in 2001 was
about the same (within 10 percent) as for accountants, biological and
life scientists, registered nurses, and editors and reporters, while
teachers earned significantly more than social workers and artists.
Only lawyers and judges earned significantly more than teachers"”as one
would expect, given that the educational training to become a lawyer is
longer and more demanding.

Teachers, moreover, enjoy longer vacations and work far fewer days per
year than most professional workers. Consider data from the National
Compensation Survey of the Bureau of Labor Statistics, which computes hourly earnings
per worker. The average hourly wage for all workers in the category
"professional specialty" was $27.49 in 2000. Meanwhile,
elementary-school teachers earned $28.79 per hour; secondary-school
teachers earned $29.14 per hour; and special-education teachers earned
$29.97 per hour. The average earnings for all three categories of
teachers exceeded the average for all professional workers. Indeed, the
average hourly wage for teachers even topped that of the highest-paid
major category of workers, those whose jobs are described as
"executive, administrative, and managerial." Teachers earned more per
hour than architects, civil engineers, mechanical engineers,
statisticians, biological and life scientists, atmospheric and space
scientists, registered nurses, physical therapists, university-level
foreign-language teachers, librarians, technical writers, musicians,
artists, and editors and reporters. Note that a majority of these
occupations requires as much or even more educational training as does
K"“12 teaching.

Curious about the data she uses, I went straight to her source, which is here, and now has data through 2003 online that can be queried.  Sure enough, her conclusions are right there in the Labor Department data:

Professional or Technical Occupation 2003 $/hr
Technician $20.85
Avg. White Collar, ex. Sales $23.33
Avg. All Professional and Technical $28.37
Elementary School Teacher $31.74
Executive, administrator, manager $32.20
Engineer, architect, surveyor $34.34
Dentist $38.93
Lawyer $46.11
Doctor $52.91

Note that when corrected for hours worked onto a $ per hour basis, teacher salaries are higher than the average white collar or professional worker, and quite competitive with other professionals such as engineers and managers.  In fact, if you were to take out private school teachers (which mix the number lower, see below) the average for public school teachers is even higher.  Occupations making more than teachers such as doctors and lawyers require much more education and long-term commitment than the average elementary school teaching role.

By the way, the Education Next article linked above gives us another clue that is useful in understanding teachers salaries:  For the vast majority of professions, a government job in that profession pays less than an equivalent private job.  People accept the lower government salary for a variety of reasons --  sometimes for unique work (e.g. interning with the DA as a young lawyer), sometimes for the higher benefits and more job security, and sometimes just because the jobs require fewer hours and frankly have lower performance expectations than their private equivalent.  The one glaring exception to this public-private salary relationship is with teachers salaries, where the salaries of public school teachers are often as much as 50% higher than their private school equivalents.

Wow!  Its no wonder that the NEA hates the idea of school choice and competition from private schools.  They have built a public employment gravy train, with premium salaries, no real penalty for under-performance, and double digit raises for a 180 day a year job -- all while selling the media on their woe-is-me-we-are-underpaid myth.

Correction:  Messed up the Breakfast Club quote - it was spoken from Carl the Janitor to Vernon, not by "Carl Vernon".

Update: A lot of people ask "What do you have against teachers?" and I answer, "nothing."  I can't remember complaining about what any employee of a private firm makes.   In fact, for employees of private firms, I am happy to root for you to get all you can.  Go for it.  But teachers are not private employees -- they are government workers, just like every other government bureaucrat who gets paid by my taxes that are taken from me against my will.  If I pay your salary, and in particular if I pay your salary against my will, you can be sure I am going to demand accountability.

By the way, I send my son to a private junior high.  The school is widely acknowledged to do a much better job than any public school in the city.  And you know what - my tuition at this school is $2000 per year LESS than the average per pupil spending in Scottsdale public junior high schools.  And this school is 100% tuition supported (it is a for profit secular institution so it can't take contributions) and it turns a profit for the family that owns it.  You know how many principals, assistant principals, administrators, and clerks it has for a 300 person junior high school?   Two.  The number at a similarly sized public school would be ten times as high. At least.

Phallocrats of the World, Unite

This letter to the editor at SIU about embattled professor Jonathon Bean is hilarious if parody, and even funnier if real.  The letter begins:

To the Editor:

My eyes were edged with tears as I read Caleb
Hale's article
in the Southern which exposed Southern Illinois University at
Carbondale history ("His-Story") Professor Jonathan Bean as a racist
hate-mongering phallocrat.

"Phallocrat" -- I love that term!  Great name for a new political party.  Stealing a joke shamelessly from one of the commenters:  "you are going to elect a dick anyway, so vote Phallocrat".

Backstory on the whole blowup at SIU is here, but the gist is that professor Bean is being excoriated for having the temerity to suggest one (1) piece of optional reading in his course (which has scads of required reading from African-American writers about white racism) about an incident of black racism.

Update:  Oh no!  The campus phallocrats are meeting stiff resistance in Rhode Island.

Recipients of Intellectual Welfare

Today, Kevin Drum quotes Obsidian Wings as saying:

The men in my family of my father's generation returned home after serving
their country and got jobs in the local steel mills, as had their fathers and
their grandfathers. In exchange for their brawn, sweat, and expertise, the steel
mills promised these men certain benefits. In exchange for Social Security taxes
withheld from their already modest paychecks, the government promised these men
certain benefits as well.

....These were church-attending, flag-waving, football-loving, honest family
men. They are rightfully proud of providing homes and educations for their
children and instilling the sorts of values and manners that serve them well as
adults. And if I have to move heaven and earth, now that they've retired, the
Republican party is NOT going to redefine them as welfare

First, I agree, whether I like the program or not, that people who contributed for years and were promised certain benefits should receive them.  The benefits the average retiree gets today were certainly paid for - in fact, over-paid-for given the implied rate of return they got for their forced "savings".  So I won't argue that these retirees are getting financial welfare.

BUT, I would argue that they are getting intellectual welfare.  Advocates for keeping forced savings programs like Social Security in place as-is by necesity argue that the average American is too stupid, too short-sighted, and/or too lazy to save for retirement without the government forcing them.  Basically the argument is that we are smarter than you, and we are going to take control of aspects of your life that we think we can manage better than you can.  You are too stupid to save for retirement, too stupid to stop eating fatty foods, too stupid to wear a seat belt, and/or too stupid to accept employment on the right terms -- so we will take control of these decisions for you, whether you like it or not.  For lack of a better word, I call this intellectual welfare

By the way, this is as good an answer as any to Mr. Drum's earlier question why liberals don't push the privacy issue harder.  He opines:

Whenever I talk about the underlying principles that should guide liberals, as
I did a couple of days ago,
one of the ideas that always pops up is privacy
rights. In fact, it comes up so often that it strikes me that we're missing a
bet by not making a bigger deal out of it.

I am all for a general and strong privacy right.  I would love to see it Constitutionally enshrined.  But liberals (like conservatives, but I am answering Drum's question) don't want it.  They want to allow women to choose abortions, but not choose breast implants.  They want the government to allow marijuana use but squelch fatty foods.  They don't want police checking for terrorists but do want them checking for people not wearing their seat belts.  They want freedom of speech, until it criticizes groups to whom they are sympathetic.  They want to allow topless dancers but regulate the hell out of how much they make.  Liberals, in sum, are at least as bad about wanting to control private, non-coerced individual decision-making as conservatives -- they just want to control other aspects of our lives than do conservatives. 

A true privacy right would allow us complete freedom over who we sleep with, what we do with our bodies, where we work, and what we pay for goods.  And, not incidentally, how we choose to invest for our retirement.  Both parties want the government to control parts of our lives, so don't expect either conservatices or liberals to be pushing the privacy issue very hard.

Update:  William Mellor of the Institute of Justice has some thoughts related to this topic in The American Lawyer:

Without realizing it, liberals and conservatives are
working from opposite ends of the political spectrum, under opposing
rationales, to reach the same end: expanded government power...

The Framers envisioned a system in which individuals enjoyed
rights equally, and the rights they enjoyed were treated with equal
respect under the Constitution. But in 1938 the U.S. Supreme Court's
ruling in United States v. Carolene Products Co. (upholding a
Congressional ban on interstate shipment of milk that contained added
fat or oil) created an artificial dichotomy under the Constitution.
Some rights, notably free speech, were elevated to a preferred tier and
now rightly receive vigorous constitutional protection. Rights demoted
to the second tier, specifically economic liberty and property rights,
wrongly receive far less protection....

Liberals, however, tend to reject the notion that the courts
have any role in seriously protecting economic liberty or property
rights. This is remarkable in light of the fact that many liberals
strongly advocate court protection for various rights-such as welfare
or abortion-whose constitutional pedigree is far more questionable than
rights to private property and economic liberties.

SEC Takes a Dive

I have often criticized Aspiring Governor Eliot Spitzer for his overreaching tactics aimed more at keeping himself on the front page (and in the hearts and minds of voters) than in really catching bad guys.  However, one of the reasons Spitzer gets support for his tactics is that there seems to be an enforcement vacuum at the SEC in pursuing corporate and banking fraud.  The Adelphia case brings us a great example, courtesy of Professor Bainbridge.  It appears that the Rigas family is going to get off with forfeiting some of the assets they plundered - no jail time and no fines!

The Securities and Exchange Commission today announced that it and the United
States Attorney's Office for the Southern District of New York (USAO) reached an
agreement to settle a civil enforcement action and resolve criminal charges
against Adelphia Communications Corporation, its founder John J. Rigas, and his
three sons, Timothy J. Rigas, Michael J. Rigas and James P. Rigas, in one of the
most extensive financial frauds ever to take place at a public company.

In its complaint, the Commission charged that Adelphia, at the direction of
the individual defendants: (1) fraudulently excluded billions of dollars in
liabilities from its consolidated financial statements by hiding them on the
books of off-balance sheet affiliates; (2) falsified operating statistics and
inflated earnings to meet Wall Street estimates; and (3) concealed rampant
self-dealing by the Rigas family, including the undisclosed use of corporate
funds for purchases of Adelphia stock and luxury condominiums. The USAO also
announced that it had entered into a Non-Prosecution Agreement with Adelphia and
had settled forfeiture claims against Rigas family members.

Under the settlement agreement, which is subject to the approval of the
District and Bankruptcy Courts for the Southern District of New York, the Rigas
family members will forfeit in excess of $1.5 billion in assets that they
derived from the fraud, including the Rigas family's interests in certain cable

This is absurd.  The stay-at-home wife of the treasurer of Enron is in the slammer right now but the Rigas's get to walk?  Note that the Rigas's last year were convicted of numerous criminal charges, but there sentencing was delayed so they could negotiate.  I guess they negotiated pretty well.  In my understanding of the cases, this is a much worse case of fraud than Enron.  These guys looted the company for personal gain, and raped their minority stockholders.   Shame on the SEC.