Coyote Blog

Hit and Run pointed out this story about a left-wing French newspaper that is looking to the Rothschilds for financial help.  I thought this would be a more interesting story of hippie meets banker, but I did find this one bit fascinating (shown in bold):

Mr. Rothschild, a scion of the powerful banking family,
forced out the long-serving editor of the paper in the summer. Serge
July, the editor who had created Libération along with
philosopher-writer Jean-Paul Sartre, said he resigned in hopes that his
departure would help save the paper from more radical changes.

Mr. July's exit was covered in the French media as the end of an era, a French version of the Japanese
seppuku, or ritual suicide, by a man who represented a more uncorrupted, hopeful France.

Since Mr. July left, some of Libération's best-known
reporters have quit, including Florence Aubenas, who was held hostage
in Iraq for six months in 2005. They have invoked the "conscience
clause" in French law that requires media owners to continue paying the
salary of journalists whose honor is offended by the owners' policies
or politics.

How screwed up does a legislature have to be to pass something this ridiculous?

Yes, for those who are counting, this is something like post number 157 on the mismatch between anti-trust myth and reality.  The myth is that it is about protecting the consumer.  The reality is that anti-trust is an opportunity for companies to get the government to sit on their competitors:

In their new version of Windows dubbed "Vista," Microsoft has included a number of useful features that has several companies rattling the anti-trust sabers once again.

For instance, Adobe Inc., creators of the widely used PDF
document standard, object to Microsoft's built-in functionality that
gives users the ability to create PDF files without having to use
Adobe's own software.

Real Networks, per usual, is protesting that Microsoft is integrating media playback capabilities in the form of Windows Media Player 11, which competes directly with Real Player.

And now Symantec, developers of anti-virus software, is complaining that Microsoft will include their own firewall, which could lower sales of Symantec's own solutions.

And as mentioned above, all three of these firms are appealing to regulators to "solve" what they see as anti-competitive business practices to prevent their sales from eroding.

Surely then, it is only a matter of time before software firms that
make calculators or solitaire protest the inclusion of such services
into Windows. Is not the native support of the English language (and
dozens of others) a clear and present danger to third-parties eeking
out a living?

Soon thereafter, perhaps boutique's specializing in steering-wheels
and headlights may begin to sue automobile companies for integrating a
steering-wheel and headlights into cars. And no one should forget about
those built-in cassette and CD players.

It's hard to see how consumers are hurt by getting more free functionality in their operating system.  Of course, the companies above will work very hard to get the government to require that you pay extra for these components. 

Economics have a concept called the "broken window fallacy" that many of the media to this day do not understand.  Here is an example:  Every hurricane season, the media always writes a "silver lining" story about how recovery from a devastating hurricane spurred the local economy.  One might assume from this reasoning that it is good to go around breaking windows, since one will make a lot of work for glaziers and boost the economy.  The problem is what is not measured.  What would the money that was spent on window replacement have been spent on instead?  It is a safe presumption that had they not had to repair storm damage, they would have spent the money on something more productive  (test:  if this were not true, everyone would be breaking their own windows).  Advocating the broken window fallacy is a bit like saying that stealing money from banks would increase the savings rate, since people would have to deposit even more money to replace that which was stolen.

Anyway, I bring this example up because today I saw the most amazing example of the broken window fallacy I have ever seen, via Kevin Drum and Business Week:

 Business Week's cover story in their current issue tells us that healthcare inefficiency is what's keeping the American economy afloat:

The
very real problems with the health-care system mask a simple fact:
Without it the nation's labor market would be in a deep coma.  Since 2001, 1.7 million new jobs have been added in the health-care sector, which includes related
industries such as pharmaceuticals and health insurance. Meanwhile, the
number of private-sector jobs outside of health care is no higher than
it was five years ago.

.... The U.S. unemployment rate is 4.7%, compared with 8.2% and
8.9%, respectively, in Germany and France. But the health-care systems
of those two countries added very few jobs from 1997 to 2004, according
to new data from the Organization for Economic Cooperation &
Development, while U.S. hospitals and physician offices never stopped
growing. Take away health-care hiring in the U.S., and quicker than you
can say cardiac bypass, the U.S. unemployment rate would be 1 to 2
percentage points higher.

....Both sides can agree that more spending on information
technology could reduce the need for so many health-care workers. It's
a truism in economics that investment boosts productivity, and the U.S.
lags behind other countries in this area. One reason: "Every other
country has the payers paying for IT," says Johns Hopkins' Gerard
Anderson, an expert on the economics of health care. "In the U.S. we're
asking the providers to pay for IT" "” and they're not the ones who
benefit.

Let's go back to slow-motion instant replay.  What was that first line?

Business Week's cover story in their current issue tells us that healthcare inefficiency is what's keeping the American economy afloat

I am not seeing things, am I?  Did he really write that it is the inefficiency of one of the largest and most ubiquitous and perhaps most important industries in the country that is propelling the economy?  Do I really have to state the obvious?  Do you really think that if all those people were not hired to push paper around in health care they would be sitting unemployed today?  What about all the money either consumers or corporations would be saving from more efficiency -- would that really not have been spent on something else?

In a way, I guess this is sort of consistent with Drum's position on Wal-Mart.  If Wal-Mart is detroying the economy (according to him) by bringing increased productivity to retail, I guess this argument that health care inefficiency helps the economy is at least consistent.  Maybe if we could get our state drivers' license agency folks to take over the whole economy, we would have a boom! And the old Soviet Union must have been an economic powerhouse!

This is some of the worst economics I have seen in a while.  Lefties like Drum often rail against conservatives for being anti-scientific in their opposition to teaching evolution or approving the morning-after pill, but for God sakes the most fundamentalist Bible-belt home schooled conservative Christian probably knows more about the science of evolution than journalists understand about the science of economics.

I just don't know why conservatives are so afraid to let folks like Khatami speak in the US.  Sure, he is a lying dictatorial human-rights-suppressing scumbag, but so what?  Its good to let people like this speak as much as they want.  They always give themselves away.  There were counter-protests and lots of debate about Iran in the news and on the nets, and that is as it should be.

I suppose conservatives real fear is that the press will, as they sometimes do, throw away their usual skepticism and cynicism and report his remarks as if they were those of a statesman rather than a thug on a PR mission.  But that's a different problem, and not a good enough excuse to suspend free speech, even for a man who granted it to no one else in his own country.  (I have never bought into the "media bias" critique, either conservative or liberal, in the press, because this seems to imply some active conspiracy exists to manage the news to some end.  Rather, I think it is more fair to say that reporters tend to apply too little skepticism to stories with which they are sympathetic.  For example, many reporters think homelessness is a big problem, so they were willing to uncritically accept inflated and baseless numbers for the size of the homeless population, numbers they would have fact-checked the hell out of if they had come from, say, an oil company to whom they are unsympathetic or skeptical of.)

On the same topic, I don't know why conservatives are so worried about this story of an increase in students from Saudi Arabia.   It used to be that we had confidence that people from oppressive countries would have their eyes opened by living in the US.  We have always believed that intellectually, freedom was more compelling than dictatorial control, and would win over hearts and minds of immigrants.  Our foreign policy with China, for example, is counting on engagement to change China.  Have we given up on this?

From Michael Siegel, with a hat tip to Reason's Hit and Run (use of colored text in the original):

An article in the current issue of JAMA (Journal of the American Medical Association),
reporting on the recent Surgeon General's review of the health effects
of secondhand smoke, brings to the forefront the controversy over
whether the Surgeon General misrepresented
the science in his public communications surrounding the report's
release ...

The
controversy stems from the press release and other ancillary materials
released by the Surgeon General to accompany the report itself.

Here is what those ancillary materials stated:

According to the Surgeon General's press release:

"Even
brief exposure to secondhand smoke has immediate adverse effects on the
cardiovascular system and increases risk for heart disease and lung
cancer, the report says."

According to the Surgeon General's remarks to the media:

"Breathing
secondhand smoke for even a short time can damage cells and set the
cancer process in motion. Brief exposure can have immediate harmful
effects on blood and blood vessels, potentially increasing the risk of
a heart attack."

According to the Surgeon General's accompanying fact sheet:

"Breathing
secondhand smoke for even a short time can have immediate adverse
effects on the cardiovascular system, interfering with the normal
functioning of the heart, blood, and vascular systems in ways that
increase the risk of heart attack."

And according to the Surgeon General's accompanying brochure:

"Even
a short time in a smoky room causes your blood platelets to stick
together. Secondhand smoke also damages the lining of your blood
vessels. In your heart, these bad changes can cause a deadly heart
attack."

These claims are markedly different from those
made in the Surgeon General's report itself, which concludes that
chronic exposure to secondhand smoke increases the risk for heart
disease, but does not conclude (or even present evidence that) a brief
exposure to secondhand smoke can cause lung cancer, heart attacks, or
heart disease.

This is a classic technique used today in scientific reports on global warming, where the report itself is often full of cautionary language about potential problems in the models and the uncertainties in predicting climate, but the summary and press releases make doom and gloom statements with absolute certainty that aren't actually supported by the research they purport to summarize. 

In both cases, the principles justify the exaggeration of the public message as all in a "good cause", which of course is the justification every lying politician uses.  Even Ted Stevens.

If true, the notion discussed here that the media will portray the same economy as better if a Democrat is in the office and worse if a Republican is in the office may be as good a reason as any to vote Democrat.  Then the media will get off the current silly "worst economy in forever" meme and maybe the presure on the goverment to step in with some sort of silly, ill-considered, and long-term destructive intervention will be reduced.  Viva gridlock and divided government!

Not really forewarned about this social trend in advance, my family was surprised to find that many restaurants in smaller English towns would not let us in with our children.  I wrote about the strange Chitty-Chitty-Bang-Bang-esque reactions we got to our children here.

Reader Tom Van Horn sends in this update from Newsweek:

a recent British study showed a house's value drops by 5 percent if
neighbors move in with teenage kids. Hotels are catering to the
childless, too; Italy's La Veduta country resort promises, "Your Tuscan
holiday will not be shattered by the clamor of children." In Rome, many
restaurants make it clear that children are not welcome"”in some cases
by establishing themselves as "clubs," where members must be older than
18 to join.

*shrug*  There are times when my wife and I like to get away from kids too, and we have a couple of them.  I know a few couples who have chosen to remain childless and I can assure you they are sick and tired of being asked about their childlessness like it was some kind of disease.  I am sure they will welcome a sense of normalcy for their chosen way to live.  Combining this trend with my observation that Parisians will take their dog anywhere, it is probably not long before there are public places in Paris where dogs are welcome but kids are not.

That doesn't mean that everyone shares my willingness to let folks live in peace like they choose.  Certain politicians around Europe seem to want to intervene (and isn't that why people become politicians in the first place -- to force other people into making choices that they would not have made for themselves?)

Politicians and religious leaders warn darkly of an "epidemic" of
childlessness that saps the moral fiber of nations; they blame the
child-free for impending population decline, the collapse of pension
systems and even the rise in immigration. In Japan, commentators have
identified the "parasite single" who lives off society instead of doing
his duty to start a family

In Germany, where the childless rate is the
highest in the world, at 25 percent, the best-seller lists have been
full of tomes forecasting demographic doomsday. In "Minimum," the
conservative commentator Frank Schirrmacher describes a "spiral of
childlessness," where a declining population becomes ever more
reluctant to have kids. Media reports have stigmatized the "cold career
woman""”one such recent article came with mug shots of childless female
celebs"”accusing them of placing their jobs before kids. Never mind that
Germany trails its neighbors in the availability of child care, or the
amount of time men spend helping around the house.

From
Germany to Russia, there is increasing talk of sanctions against the
childless. In Slovakia, a leading adviser on the government's Strategic
Council on Economic Development proposed in March to replace an
unpopular payroll tax with a levy on all childless Slovaks between the
ages of 25 and 50. In Russia, where the birthrate has dropped from 2.3
in the 1980s to 1.3 today, a powerful business lobby has called for an
income-tax surcharge on childless couples. In Germany, economists and
politicians have demanded that public pensions for the childless be
slashed by up to 50 percent"”never mind that such pensions were invented
as an alternative to senior citizens' having to depend on their
offspring.

I was thinking on the airplane today about how to categorize our current situation in Iraq.  Its hard to draw exact conclusions about where we are there, because I don't think anyone is giving the whole story.  I am willing to believe that we have done a better job than the media has portrayed of rebuilding infrastructure and schools and wells and all that stuff, though at a horrendous cost.  I am also willing to believe that the Bush administration is downplaying crucial problems of factionalism and tribalism that they grossly underestimated before getting involved there.

My fear is that we have turned Iraq into a big dead man's switch, with the US army's finger on the button to keep things from blowing.  My fear, and I think a lot of people share it, is that as soon as we leave, and take our finger off that figurative switch, the whole place is going to blow up.  And, to overextend the metaphor, I can't see what the US is doing or can do to disarm the thing.  Its a lose-lose, as far as I can see, with a costly long-term occupation leaving us open to the "imperialism" meme on one hand, and reduced long-term credibility on the other, with a pull-out letting future allies and enemies alike know that there is a point at which we give up.  Its back to the old Wargames conclusion:  "Strange game -- the only winning move is not to play."

Apparently there is a new study being trumpeted by social conservatives to help them begin a new attack on raunchy song lyrics.  The Rand study to be published in the journal Pediatrics did phone interviews with a bunch of teenagers, asking them about their sexual habits and what songs they listen to.  They found a correlation that teenagers tend to listen to more sexually-degrading music also are more likely to subsequently begin having sex (or having more sex).  The articles reporting on this study have headlines like this:

Study: Raunchy Music = Earlier Sex

The implication is that listening to sexually-charged* music causes more early sex.  But in fact, they don't know that.   Before it starts to rain here in Phoenix, the sky goes dark and the winds pick up.  Does this mean that darkening skies and increasing winds cause rain?  Or are darkening skies and winds merely a leading edge symptom of a broader phenomena that also includes rain, which we might call "a thunderstorm moving through town."

Does interest in sexually degrading lyrics actually cause teenagers to have sex when they might not have otherwise?  Or is this interest in such music merely a leading indicator, a symptom on the leading edge of a larger phenomena that one might label "adolescence" or "hormone overload."  As an alternative hypothesis to explain the data, one could argue that listening to this music is merely an early low-risk form of sexual experimentation, like sneaking a peek at the Playboy magazines at the local 7-11, which then gets followed up by (but doesn't cause) physical sex. 

I don't know the answer.   Though few would describe me as a puritan, I certainly won't let some of that crappy music in the house (I do check what the kids are downloading on iTunes).  On the other hand, "Don't Fear the Reaper" was one of my favorite songs for years and I never felt the slightest urge to kill myself. 

What I do know is that you absolutely have to beware of the media when they report studies and statistics, and correlation=causation is their absolute favorite mistake to make.

* the article makes a second mistake, in that the study authors found a difference between the correlation of teen sex with sexually degrading music vs. just music with sexual content.  The media also misses this distinction.

Postscript:  This article about professional wrestling leading to teenage violence seems to make the same mistakes

Apple just lost $100 million to a Creative Labs suit over iPod menus.  Stephan Kinsella isolates exactly what the unbelievable breakthrough it was that Apple will now have to pay for.  Here it is.  Be amazed at the genius involved, all you small-minded folks who would never have been smart enough to think of this for yourselves:

A method of selecting at least one track from a plurality of tracks
stored in a computer-readable medium of a portable media player
configured to present sequentially a first, second, and third display
screen on the display of the media player, the plurality of tracks
accessed according to a hierarchy, the hierarchy having a plurality of
categories, subcategories, and items respectively in a first, second,
and third level of the hierarchy, the method comprising:

• selecting a category in the first display screen of the portable media player;
• displaying the subcategories belonging to the selected category in a listing presented in the second display screen;
• selecting a subcategory in the second display screen;
• displaying the items belonging to the selected subcategory in a listing presented in the third display screen; and
• accessing at least one track based on a selection made in one of the display screens.

Oh my god, like, my head is going to explode this is so revolutionary and complicated.  Someone just invented the hierarchical menu.  Jeez, how have we done without this all these years?  </sarcasm>

One of the modern world's newest guilty pleasures is Googling yourself.  One of the unsung virtues of blogging is that it tends to help you dominate the Google rankings for, uh, yourself.  Anyway, I Googled myself tonight (Everybody does it.  Really.) and found that I missed a mention entirely in Business Week online, in this article about "blooks", the cutesie name for making a book out of blog content.  My logic for doing so is in the last section.  I will save you the click:

Another benefit of publishing blooks on paper? Archiving. Warren Meyer,
of Paradise Valley, Ariz., first printed out the two volumes -- 400
pages each -- of his blog entries last November as a Christmas gift for
his dad, who is 83.

"He refuses to do anything online," says Meyer, who has been blogging for more than two years. Meyer
has also kept a copy of his blook, based on Coyoteblog.com, discussing
environmental problems, for himself: "Everything I've ever written is
online," he says. "I wanted to archive my writing, and I don't trust
that electronic media is a good archiving tool, because standards and
technology change so much." While few people now use floppy disks,
paper is here to stay.

I have tried to explain this to younger folks without much success.  But for those of you who have used computers for a while, where are your old Compuserve emails?  How about those old files from your Apple II?  Does your current computer have a 5-1/4" floppy drive?  Beware keeping data only in digital form.  It may still be there in 20 years, but will you be able to read it?

Update: Forgot the link.  Added it.

From the NY Times:

People of Valentin Keller's era [mid 19th century], like those before and after them,
expected to develop chronic diseases by their 40's or 50's. Keller's
descendants had lung problems, they had heart problems, they had liver
problems. They died in their 50's or 60's.

Now, though, life has changed. The family's baby boomers are reaching middle age and beyond and are doing fine.

"I feel good," says Keller's great-great-great-grandson Craig Keller.
At 45, Mr. Keller says he has no health problems, nor does his
45-year-old wife, Sandy.

The Keller family illustrates what may
prove to be one of the most striking shifts in human existence "” a
change from small, relatively weak and sickly people to humans who are
so big and robust that their ancestors seem almost unrecognizable.

Scientists are looking for the explanation of a generation of humans so much stronger and healthier than those who preceded them.  Hypotheses seem to center on pre-natal maternal health and early life nutrition.  But I can give the bigger picture answer:  wealth.  Not Bill Gates wealth, but the generally enormous increase in wealth, even among the poorest Americans.  I discussed this issue along with other related ones in this article on wealth creation.  And this cartoon seems relevant.  Also makes you wonder about whether the obsession with obesity nowadays makes much sense.

The biggest surprise emerging from the new studies is that many chronic ailments like heart disease,
lung disease and arthritis are occurring an average of 10 to 25 years
later than they used to. There is also less disability among older
people today, according to a federal study that directly measures it.
And that is not just because medical treatments like cataract surgery
keep people functioning. Human bodies are simply not breaking down the
way they did before.

Even the human mind seems improved. The
average I.Q. has been increasing for decades, and at least one study
found that a person's chances of having dementia in old age appeared to
have fallen in recent years....

People
even look different today. American men, for example, are nearly three
inches taller than they were 100 years ago and about 50 pounds heavier.

A nice perspective to maintain during modern media-fed health panics.

Update:  Brian Doherty makes a similar observation.

One of the ways I like to pass the time on long drives (we went to San Diego this week with the kids) is to listen to audio books in the car.  For this trip, my wife picked out Kenneth Davis's Don't know much About History.  This particular version had been edited down to a quick 3-1/2 hours.

Its of course impossible to edit American history down to this short of a time, but we thought it might be enjoyable for the kids.  Also, I am used to the general "America sucks and its heros suck too" tone of most modern revisionist history, so I was kind of prepared for what I was going to get from a modern academician.   But my God, the whole history of this country had been edited down to only the bad stuff.  Columbus as a source of genocide -- the pettiness of American grievances in the revolution -- the notion that all the ideals of the Revolution were so much intellectual cover for rich men getting over on the masses -- the alien and sedition acts -- slavery -- massacre of Indians and trail of tears -- more slavery -- civil war -- mistreatment of the South after the war by the North -- more massacre of Indians -- Brown vs. board of education -- the great depression as the great failure of laissez faire economics -- did Roosevelt know about Pearl Harbor in advance -- McCarthyism -- racism and civil rights movement.   All of this with numerous snide remarks about evil corporations and rich people and the never-ending hosing of the poor and women/blacks/Indians (often in contexts entirely unrelated to what he is talking about, such that the remark is entirely gratuitous).

That's as far as we have gotten so far, but I am really giving you a pretty honest outline of the segments.   I have zero problem admitting that America's treatment of its native populations was shameful and worth some modern soul-searching.  Ditto slavery.  But to focus solely on this litany, with nothing about the rising tide of standard of living for even the poorest, of increasing health and longevity, of the intelligent ways we managed expansion (like the homestead act), of having the wealth and power to defeat fascism and later communism in the 20th century when no one else could do it.  Of creating, in fits and starts and with many long-delayed milestones, the freest country in the world.  Of a history where every other democratic revolution of the 18th and 19th century failed and fell into chaos and dictatorship but this one succeeded.  He begins the book by saying that he is bravely going to bust all the myths we have grown up with, but in essence helps to reinforce the #1 myth of our era:  That America is a bad actor on the world stage and less moral than the countries around us.

Which of course, is insane.  And remember, I am the first one to criticize our government over any number of issues, but the moral relativism that academics apply to America represents a shameless lack of correct context.  To borrow from a famous saying, I am willing to admit that America has the most shameful history, except for that of every other country in the world.

Postscript: I don't even deny that a book with the premise that "schools and media often gloss over the bad stuff, so I want to let you know that America has a dark side too" would be a perfectly viable project.  However, this book represents itself as a general history text, and does not claim this particular mission as its context.  By the way, I am not sure what country he is living in if he thinks this stuff is not taught in schools.  My kids' schools totally wallow on all the bad stuff - the racism, the environmental problems, etc.  I would be willing to bet more graduates of public schools today could answer "Maintenance of slavery" to the question "what was the biggest failure of the Constitution" than they could answer the question "Why did the US Constitution succeed when so many other democratic revolutions failed?"  The latter is a much more interesting question.  Of course, in this audio book, predictably, Mr. Davis addresses the former in great depth and never even hints at the latter.

Via Liz Lightfoot in the Telegraph:

Nearly 60 per cent of girls aged 12 to 15 described themselves as
overweight when only 15 per cent met the medical criteria for excess
body fat.

The findings prompted the Schools Health Education Unit, which carries
out the annual survey, to issue an appeal for an end to the "obsession"
with skeletal body shapes in the media and fashion industry.

Yeah, I know this is the UK, but I bet you would get similar results in the states.  While the article points the finger at the media and fashion industry, how about government and academic know-it-alls who with their recent obsession on teenage obesity are reinforcing this message?  For example, remember this previous post about the Arkansas governor's new program:

I get email and comments from time to time that my language deriding
government's intervention into every aspect of our lives is overblown
and exaggerated.  My answer:  Oh yeah, well how about this:

Mike Huckabee, the Governor of Arkansas, now
requires annual fat reports. These are sent to the parents of every
single child aged between 5 and 17; a response, he says, to "an
absolutely epidemic issue that we could not ignore" in the 1,139
schools for which he is responsible.

I
just cannot craft any reasonable theory of government where this is the
state's job.   The "obesity" crisis in this country just amazes me.
"Experts" every few years broaden the definition of who is overweight
or obese, and suddenly (surprise!) there are more people defined as
overweight.  Even presuming it is the state's job to optimize our body
weights, is it really the right approach to tell everyone they are too
fat?  Having known several people who were anorexic, including at least
one young woman who died of its complications, is it really a net
benefit to get young people more obsessed with looks and body style?
And what about the kids that are genetically programmed to be
overweight?  Does this mean that years of taunting and bullying by
their peers is not enough, that the state's governor wants to pile on
now?

It is interesting to note that governor Huckabee apparently started
this initiative after his own personal battle with weight loss:

[Huckabee] lost 110lb after being warned that his
weight, more than 280lb after a life of southern fried food, was a
death sentence. A chair even collapsed under him as he was about to
preside over a meeting of state officials in Little Rock.

We
all have friends who have lost weight or gotten into homeopathy or
became a vegan and simply cannot stop trying to convert their friends
now that they see the light.  Now we have the spectacle of elected
officials doing the same thing, but on a broader scale and with the
force of law, rather than  just mere irritation, on their side.  One
can only imagine what report cards kids would be carrying home if
Huckabee had instead had a successful experience with penis
enlargement.  What's next, negative reports for kids with bad acne?
For women whose breasts are too small?  For kids who are unattractive?

My casual, uninformed observation so far has been that for all of its strong-arm tactics and media advantage, the government's case so far in the Enron trial has been weaker than I had been led to expect in the media and publicity run-up.  Tom Kirkendall agrees, and has been all over this case including this recent update.

I am seriously late on this one, but I still want to show my support for Lance Dutson, author of the Main Web Report, who is being sued by an advertising firm and harassed by the state government for uncovering some really dumb activities at the state tourism board.  A summary of what he found is here, and the story of the lawsuits is here.

This story rings absolutely true with me.  Given our significant experience with government agencies, I have seen time and time again that when government bureaucrats embark on an activity out of their traditional comfort zones (in this case, Internet pay-per-click advertising, a new activity for most of us) they tend to combine lack of training with total arrogance that they know exactly what they are doing.  Within my company we have dubbed this "condescending incompetence", and we see it all the time.

In this case, Mr. Dutson points out that by bidding up the price in Google adwords of travel-related terms, they are actually hurting Maine travel businesses, both by driving up their advertising costs and by diverting clicks from an actual tourist business to a government site.  And how could any sensible cost-benefit analysis lead to paying over $15 to get one (1) viewer to the government tourist web site?  The answer is, it can't.  The only thing that can drive this behavior is ignorance combined with a skewed incentive system (e.g. some bureaucrat wanted a line in a performance review or PowerPoint chart that said their web site was top-ranked on every key Google search).  And he rightly points out some disturbing conflicts of interest at the advertising agency, as well as the total bonehead maneuver of putting an adult phone-sex number in the ad copy.

By the way, I despise state tourism agencies.  Most of the money they spend is a waste and the rest goes to directly benefit a few cronies.  Most of our local dollars go to high-profile expenditures that gets the governor some extra media buzz but does zero to get anyone new to the state.   And note that I run a business that depends 100% on tourism.  These state expenditures do nothing for me.  In some cases, my customers pay as high as 12% lodging taxes (e.g. tax and bureaucracy hell Mono County, California) to fund tourist boards who don't even advertise the types of operations I run (campgrounds and marinas).

The feeding frenzy that the media has been salivating over for days can begin, now that Exxon-Mobil (XOM) as announced quarterly profits.  They reported net income of $8.4 billion on $88.98 billion in sales, for a net income margin of 9.4%.  Previously I observed that 9.4% for a peak profit in a cyclical industry is pretty average, and that over the last decade oil company profits have been below average for the whole of US industry.

In fact, most investors found these profits to be disappointing.  You know you have a fun CEO job when half the country is pounding on you for profits being too high and the other half are pounding on you for profits being too low.  The fact is that XOM and other large US oil companies don't get the benefit of rising oil prices that they did, say, 40 years ago.  US oil companies no longer own most of their overseas reserves since many of their foreign operations were nationalized by countries in the 1960s  (with the US government refusing to lift a finger to protect these US assets, one of the early instances of the no-blood-for-Exxon argument).  Today, XOM must pay near market rate for much of this crude, either in arms-length purchases or through royalty agreements stacked in the favor of local governments.

So what can you folks who are screaming about high gas prices and obscene oil company profits do?  Well, you could tax all these "windfall" profits away, like Ford and Carter did in the late 1970s.  Of course, you would still be paying $3 for gas, but the profits would go to the US Congress to spend, who I am sure will do an excellent job.  Probably could pay for another bridge in Alaska.  Or, you could somehow ban oil companies from making a profit, and drop gas prices by that 9.4%, or about 28 cents.  This would get you $2.72 gas instead of $3.00 gas.  Feel better?  Of course, in either scenario, oil companies would stop making any investments in refining or oil exploration.  Supplies would quickly begin to fall (I won't go into it now, but take my word for it that refineries and oil wells require constant reinvestment just to keep running at current capacity) and I would bet it would take less than a year for that 28 cents to be right back in gas prices due to shrinking supply.

OK, what else could we do?  Well, we could cap gas prices.  Which is a fabulous idea, as long as no one who drives a car has anything better to do than sit in lines all day.  Or, we could regulate oil like we do telephones and electric utilities.  Highly regulated electric utilities make a net income margin of 7.1%.  If we regulated oil companies down to 7.1%, then this would reduce gas prices from $3.00 to $2.93.  So a huge and inflexible and costly national regulatory structure would save about 7 cents a gallon.  Oh, and since for most of 10 years oil company profits have been less than 7.1%, then, a utility type regulatory environment would likely raise gas prices and profits in most years. And of course you would get all the business flexibility, creativity, and customer service currently demonstrated by your local electric and phone company.

So what government action should a irate gasoline customer demand?  Well, I know this answer goes against years of education that the role of government is to step in and take over when any little aspect of life is not quite what citizens want it to be, but the correct answer is "none".  Its like the line from Wargames:  "A strange game. The only winning move is not to play."

More on why gas prices are still well below their historic peaks here.

The media is just longing to make current gas prices into a crisis.  And you can already see them gearing up to bash oil companies for "record" profits (by the way, when reading the profit announcements, pay attention not to just total dollars but to profit margins, then read this).

Glenn Reynolds links this gas price chart this morning at Random Useless Data, showing that in real terms, gas prices are still below their peaks, and not at "all-time highs."

I took this one step further, based on the assumption that it isn't the price per gallon that matters for gas, but the price to drive a fixed mileage, say 100 miles.  Since average automobile fuel economy has continued to improve, in real terms we are far below the peak cost of gasoline.  Using this and this MPG data (for passenger cars) and the inflation adjusted gas prices here, I got this chart (1979 dollars)

By the way, just so you know my personal incentives, there are very few people out there who run a business whose fortunes are more sensitive to gas prices than my recreation business.  This will not be a very good summer for me, but if we leave the market alone to do its work, things will likely be better in 2007.  Intervention by Congress will pretty much assure that things will get worse.

In perhaps the best example I have seen since Paul Ehrlich of zero-sum thinking, junkscience.com links to this article at the BBC:

A study by the New Economics Foundation (Nef) and the
Open University says 16 April is the day when the nation goes into
"ecological debt" this year.

It warns if annual global consumption levels matched the UK's, it would take 3.1 Earths to meet the demand.

How many times does this sort of stuff have to be wrong before it stops getting printed by "science writers" in the media.  Malthus made the same argument over a century ago, and Ehrlich has been making one bad prediction after another along these lines since the late 60's  The report relies on this concept:

The findings are based on the concept of "ecological
footprints", a system of measuring how much land and water a human
population needs to produce the resources it consumes and absorb the
resulting waste.

Of course, no one mentions that this "ecological footprint" number has changed dramatically with technology, not only in the last 200 years but even in the last 30.  For example, total US Farm acreage has fallen for the last fifty years, while agricultural production has grown between two and five times in the same period.   Its a stupid, meaningless analysis that says that if nothing else changed, and suddenly consumption went up, there would be a crisis.  It relies on the lack of imagination of both the authors (and to an extent, the audience), arguing that since they can't think of any way to grow production any further, it must not be possible.  I can just picture these guys as prehistoric man sitting in a cave making the same pronouncements of disaster for the species, all while their peers are busy outside playing with bone tools under the big black monolith.

More on the zero-sum fallacy here.

From the Washington Square News, campus paper of NYU:

American media outlets did not utilize their freedom of speech rights
after they chose not to reprint the George Bush cartoons that negatively
depicted the US President, panelists said last night at a
discussion held at the Kimmel Center.

The event, titled "Free Speech and the Bush Cartoons," displayed
easels with blank panels instead of the cartoons after NYU demanded
that the cartoons be removed from display if the public was admitted....

"Realistically, one can have a discussion on smallpox without actually
handing out the the live virus to the audience," university spokesman
John Beckman said. "Any institution has a responsibility that events on
its grounds go smoothly and without disruption."

The panelists expressed concern that all American publications, with
the exception of three, were unwilling to reprint the Bush cartoons....

Bostom said it is healthy to question a politicians, and Republicans should be
able to handle the publication of cartoons that parody them.

"The cartoons were a healthy dose of direct criticism [toward conservatives]," Bostom said.

Schwartz said fear was behind the media's motivation not to reprint the images.

"The New York Times claims not to run the pictures because of the
matter of taste," Schwartz said. "But, in fact, everyone knows they're
perfectly willing to offend people who they don't fear will have the NSA wiretap them."

NYU's decision to bar the public from seeing the cartoons illustrated
an apprehension towards free speech, and its actions were chilling and
absurd, Lukianoff said.

"If you want to talk about an image, you might want to show them," said
Lukianoff, who later pointed behind him at the blank easels and yelled,
"This is censorship!"

Lukianoff said people easily feel harassed by ideas contrary to their own.

"Nobody has a right not to be offended," Lukianoff said.

Midway through the discussion, Republican students who had gathered outside
to protest, unfurled a white banner with red letters that said,
"Freedom of Speech Does Not Equal Freedom to Hate."

Leaf said it is unhealthy for the academic community to avoid discussing sensitive issues.

"Part of being in a modern world and part of being in a university
means being able to talk about these subjects seriously," Leaf said.

People are afraid to talk and publish the cartoons, and we shouldn't
have to worry about dancing around sensitive issues, Leaf said.

During the discussion, Schwartz criticized conservatism, saying
that it forces its followers to imprison themselves in dogmatic
traditions.

"The philosophy I subscribe to is objectivism, which believes reason is man's only knowledge," he said.

Schwartz said that the violent uprisings were motivated by partisanship and not reason.

"Partisanship is blind obedience in rejection of reason," Schwartz said. "If
you base your arguments on partisanship, then it leaves no room for your
argument. It leaves you with no other option but force."

Schwartz said the attacks were not just in defense of Conservatism. 

"This is an attack on the free, rational mind," he said.

CAS junior James Ferguson said it was unfair that so much time was spent on attacking conservatism.

"To demonize a political party is not going to help anything," Ferguson said.
"When did free speech turn into a hateful generalization of conservatism?"

CAS junior Muniba Hassan said the panel will provoke hatred of conservatives,
which has caused many of her Republican friends to be afraid to walk home
at night.

"They used free speech as a way to hide their partisan agenda," Hassan said.

OK, I may have substituted a few words to make a point about the bankruptcy of NYU's censorship, and the double standards they hold since they clearly would not have made the same decision with the alternate facts I have inserted.  Real article here.  Here is a hint to prospective college students:  Distrust any college whose administrators equate exercising first amendment rights to spreading a deadly virus.  More here at FIRE, which continues to do great work.

PS-  If you have not seen the Danish cartoons, spend 10 seconds clicking here.  You will not believe how bland they are.

I have never been one to wade much into the whole "media bias" issue.  Whenever I have discussed it, my main point of view is that journalists of whatever political stripe tend to suspend necessary skepticism when writing about an issue they are really passionate about.  That is why advocacy journalism can yield such crap.  I have never once dug into a strong advocacy journalism piece and not found any number of "facts" to be without attribution and often to not even make any sense.

Most people have now heard the origins of the now-famous "million homeless families" non-statistic, which was reprinted over and over but has been admitted to have been just made up by a leading homeless advocate.  And lets not forget Mary Mapes, who proudly describes herself as an advocacy journalist, and her now famous use of forgeries in her Bush-National Guard reports, leading to the classic "Fake but Accurate" meme.  People who believe in a cause, whether it be homelessness or GWB's fundamental corruption, suspend skepticism for "facts" and "statistics" that fit their point of view on the subject.  Usually they will shrug off challenges to the fact, saying "well, it may not be exactly X but we know the problem is a really big number."  In other words, fake but accurate.

Angela Valdez has a nice analysis of one such advocacy journalism effort, in this case the Oregonian's over-one-hundred part series on the "meth epidemic".  For example, she writes:

On Feb. 20 of this year, columnist S. Renee Mitchell wrote, without
offering data to back up her claim: "The number of meth addicts"”and the
crimes they commit to support their habits"”is exploding."....

In fact, meth use during the past four years has either declined or
stayed flat, according to two major national drug-use studies. The
National Survey on Drug Use and Health shows that meth use did not
increase at all from 2002 (two years before The Oregonian
started its carpet-bombing coverage) through 2004, the last year for
which there is data. The University of Michigan's Monitoring the Future
Study, which examines drug use among youth, actually shows a decline in meth use among high-school students from 1999 to 2005....

Despite The Oregonian's reliance on this figure, there is no good evidence that meth causes 85 percent of the property crimes in Oregon.

Portland State University criminology professor Kris Henning
says the number just doesn't make sense. Department chair Annette Jolin
says the unsupportable statistic has become "something of a joke"among
statistical researchers in the department.

For one thing, Oregon property crimes are much lower than they
were 10 or even 20 years ago, the time period of the supposed meth
"epidemic."

"If meth causes property offenses, and meth use has gone up,"
Henning says, "then property offenses should have gone up. And they
haven't. It's either that, or all the people who commit property crimes
have disappeared and been replaced by a small number of meth users."

I looked at the silliness of meth hysteria statistics here.  But my point is that this is not a meth issue - this is an advocacy journalism issue.  You could write the same article challenging any number of articles in the paper every day.

PS-  But on the subject of meth, I will make one prediction:  I predict that the meth hysteria will do more to create legislation and police practices that will undermine civil liberties than did 9/11.  In fact, much of the Patriot Act is already used more to fight the drug war than to fight terrorism.

Tom Kirkendall has another excellent roundup of the Lay/Skilling trial.  According to Kirkendall, the prosecution is having some trouble, and in fact have wandered pretty far afield from their original indictment (a document that the prosecution now actually has disowned).  In effect, Lay and Skilling seem to be being tried for different things than they were ostensibly brought to trial for.  Most interesting is this:

On the other hand, the Task Force's case to date has wandered away from
the SPE's, so there is a decent chance that a difficult-to-control
Fastow could end up being a not-so-important witness in the
ever-changing big scheme of this corporate criminal case of the decade.

If Kirkendall is reading the trial correctly, and the SPE's and Fastow's testimony are becoming irrelevant, then the trial has virtually nothing to do with anything we have heard about in the media about Enron.

Barrionuevo and Eichenwald, who have been following the trial for the NY Times, agrees that the government case is shifting but believe it is due to the strength of what has been presented so far.

A steady drumbeat of damaging testimony in the five-week-old criminal trial against the former chief executives, Jeffrey K. Skilling and Kenneth L. Lay,
has led legal experts to praise the government case presented so far.
That has raised questions about the risks prosecutors would run by
putting Mr. Fastow, the former chief financial officer, on the stand as
early as Tuesday.

I haven't followed the testimony in any depth, so I can't choose from these two point of views, except to say that the government tactics of essentially changing the charges mid-trial and suppressing defense witnesses by naming a record number as unindicted co-conspirators may or may not be effective, but strike me as fairly scary abuses of the justice system.

The firm of Arthur Anderson was put to death by government prosecutors.  Unlike human beings, Anderson was killed without ever receiving a trial, and was dead long before any appeal was mounted.  Many a media tear have been shed for Enron employees who lost their savings in the Enron 401-K, where they invested in Enron by choice, but I have seen few people sympathizing with the tens of thousands of people who lost their savings in the AA collapse, the vast vast majority of whom never touched the Enron account.

Mary Morrison has a nice analysis (pdf) of why Anderson was probably killed unfairly.  Her central argument is that the main fraud at Enron was perpetrated in the off-balance sheet special purpose entities, or SPE's, when third parties put up capital that the SPE called equity, but was in fact really a loan with a verbal (non-written) promise to repay by either the entity or Enron.  By disguising a loan as equity, and by by disgusing related parties as arms-length investors, Enron was able to avoid consolidation of the SPE's with its financial statements.

Ms. Morrison argues persuasively that since Anderson was not the auditor for any of these SPEs, it had no way to uncover the true nature of these sham financing agreements, since these SPEs were effectively different corporations with different auditors.  AA had to rely on signed statements by each deal's principals that the financing for the SPE was as described (which is standard practice in this type situation and is considered to represent adequate due dilligence).  Anderson had no way to know what was going on in the SPE's, and since the SPE's were separate legal entities from Enron, it had no legal right to poke around in these entities and of course no subpoena power.  It had no way to know about the hidden verbal second part of the financing agreements.  She argues AA was a victim of the fraud and of false statements by Enron and the SPE managers and investors. 

It is interesting to note that the prosecution of the Enron case is prosecuting Enron managers right at this minute for making such fraudulent statements to AA and for hiding the nature of the SPE's from AA.  In other words, the prosecution team that first gave AA the death penalty for allegedly conspiring with Enron to hide their problems is now prosecuting Enron managers on the legal theory that AA was innocent and duped by the managers, which was AA's defense before they were wiped out.

Tom Kirkendall has more on AA's martyrdom here.  He also continues his scary series of articles on prosecutorial abuse here.  The pressure brought to bear to prevent defense witnesses from testifying is particularly frightening.  When you read this, you are really left wondering how the auditors for the SPE's, which may include KPMG, escaped unscathed (in fact escaped richer, since they got their share of the now-defunct Anderson's clients) when Anderson was put to death.

As I suspected in this post last week, it is increasingly clear that Wayne Gretzky's name was leaked by the NJ Police and/or prosecutors in order to raise the profile of their investigation, and therefore their work.  For those not following the case, initially they accused one or more B-list hockey players of running an illegal bookmaking business.  When that failed to get their investigation on the front page, they leaked the fact that they had tapes of Wayne Gretzky proving he knew about the alleged illegal activity. 

Well, that helped them achieve their goal.  They got their investigation on the front page everywhere, and set up a feeding frenzy as the media tried to climb all over each other to throw mud at one of the heretofore last unsullied great names in sports.  Now, as I suspected, we find out that they really had nothing on Wayne, and misrepresented what they had to get themselves headlines:

One of Canada's all-time great
heroes may get the change to keep that title, after a long week in an
ugly spotlight. The heat's being taken off Wayne Gretzky.

Gretzky was
beaten down by the media spotlight since early February, when his wife
and assistant coach were implicated in an alleged illegal gambling
ring. Gretzky was pulled into the fray a couple of days later, when
sources suggested he was in the loop on the whole thing. But there's
new information on a wiretap conversation between Wayne Gretzky and
Rich Tocchet, which seems to support Gretzky's contention that he had
no prior knowledge of an illegal gambling ring allegedly involving
Tocchet.

It turns out the conversation on how Gretzky's wife
could avoid being named as a participant was recorded last Monday, the
day after Janet Jones allegedly won money betting on the Super Bowl.
Also, Gretzky's wife Jane was alleged to have laid a half million
dollars in bets -- but that also appears to have been false
information. It's believed she only bet about a fifth of that.

OMG, I guess they told the truth -- they did have tapes that showed Wayne Gretzky knew about the abuses.  Of course, what they did not say last week was that the tapes were made AFTER the whole mess became public.  OK, I confess, I too knew about the bettin scandal after it became public.  There goes my reputation.

Unfortunately, our country is increasingly being operated as if we have a inalienable right to be titillated that trumps stuff like, oh, due process.  I made a similar observation in response to leaks of grand jury testimony on steroids.  I also recently posted on prosecutorial abuses in the Enron trials.

Update:  Apparently, NJ prosecutors are now saying that the bets Janet Gretsky allegedly made are not even illegal in the state of NJ.  So they leaked damaging information about both the Gretsky's "involvement", then 2 weeks later let the other shoe drop and made it clear they really didn't do anything illegal.  It couldn't be clearer that the police and prosecutors released the Gretsky's names to the press to grab the front-line headlines they were not getting with their B-list targets.