Coyote Blog

Conservatives rightly criticised the Obama Administration for rewriting rules so frequently and seemingly arbitrarily that businesses were reluctant to make long term investments.  As the WSJ editorialized in 2016:

Pfizer CEO Ian Read defends the company’s planned merger in an op-ed nearby, and his larger point about capricious political power helps explain the economic malaise of the last seven years. “If the rules can be changed arbitrarily and applied retroactively, how can any U.S. company engage in the long-term investment planning necessary to compete,” Mr. Read writes. “The new ‘rules’ show that there are no set rules. Political dogma is the only rule.”

He’s right, as every CEO we know will admit privately. This politicization has spread across most of the economy during the Obama years, as regulators rewrite longstanding interpretations of longstanding laws in order to achieve the policy goals they can’t or won’t negotiate with Congress. Telecoms, consumer finance, for-profit education, carbon energy, auto lending, auto-fuel economy, truck emissions, home mortgages, health care and so much more.

Capital investment in this recovery has been disappointingly low, and one major reason is political intrusion into every corner of business decision-making. To adapt Mr. Read, the only rule is that the rules are whatever the Obama Administration wants them to be. The results have been slow growth, small wage gains, and a growing sense that there is no legal restraint on the political class.

I am willing to believe this is true. On my own smaller scale, our company has disinvested in California because we simply cannot keep up with the changing rules there.

But all this forces me to ask, why doesn't this same Conservative criticism apply to Trump's trade policy?  The rules are changing literally by the day -- Consumers of goods from Mexico are going to be hit by new tariffs, Mexican goods are not going to be hit by new tariffs, China is hit by new tariffs, a China deal is near, a China deal is not near, Company A got a special tariff exemption, Company B did not get a special exemption, etc. How can any company with a global supply chain, which is most any US manufacturer nowadays, plan for new products or investments in this environment when they have no ability to make long-term plans for their supply chain?

Like many commenters, the hell the soldiers faced on Omaha beach  when the ramps dropped on the landing craft is simply beyond my imagination.  Everyone talks about the bravery of the men that day, which is beyond question.  But the ultimate success at Omaha Beach, which was far from assured after the first hour, required more than bravery.

Virtually the entire plan for the Omaha Beach landing was moot from the first minutes of the battle:  the naval and air bombardment was completely ineffective, the tanks that were to support the landing never made it, and many of the landing craft landed in the wrong places.  But the carefully coordinated waves of landings were fairly robust to these sorts of problems.

In my mind the number one planning problem is that the whole invasion plan and all the training was geared to getting off the beach from a limited number of draws that led inland through the beachfront hills and cliffs.  These draws, however, were absurdly well defended by concentrations of troops and hard fortifications.  It was virtually impossible to advance through these draws as was planned.

The success at Omaha was based on a few (mostly junior) men, under murderous fire, having the brains to recognize the plan was bad and improvising a new plan on the spot.  Eventually, these men began to lead others up the steep hills to the top (most of the heavily defended draws were only taken later from the rear).

The participants in the (often unsuccessful) North Korean human wave attacks in the Korean War were undoubtedly brave.  But these men were not allowed to exercise any initiative or use their intelligence to formulate a better plan than being thrown uselessly in masses directly into the teeth of fortified positions.

So yes, its appropriate to celebrate the bravery of the troops.  But bravery alone would have led to slaughter with waves of men mindlessly trying to storm up the fortified draws.  Omaha Beach was ultimately won with intelligence and initiative of junior officers and enlisted men.

Postscript #1: If there was a failure at Omaha Beach, it again went back to the organizers and planners.  They spent so much time training men in the landing itself, they did not spend any time training or even planning well on what to do next.  As a result, instead of expanding the bridgehead, most of the troops stopped not far from the top of the beach escarpments.  In the following weeks, troops were to spend miserable days in the hedgerow (bocage) country, without any training or fighting doctrine of how to deal with this beautiful defensive terrain.  Again, it was often the initiative of the frontline troops, rather than the planners, that ultimately developed fighting doctrine to deal with the hedgerows.

Postscript #2: Tomorrow I will have my usual day-after-D-Day post on why the Normandy landings were magnificent but not necessarily what actually defeated Germany.

Postscript #3:  Americans, particularly after the movie Patton, love to dump on British General Montgomery.  But D-Day was essentially his plan, and for all that went wrong, it was a magnificent plan.  Montgomery caught a lot of flak from Americans then and now for being too slow and cautious at times when daring and speed were required.  But the flip side of this is that he was an undoubted master of the set-piece, highly planned major attack -- better at this than anyone I can think of on  the Allied side in Europe.

I got some attention with a post the other day about an example of something I see constantly -- government employees unwilling to admit even the smallest error.

One reason is that even as someone who runs a company that partners with government agencies frequently, I am still an outsider and a member of the general public.  And government agencies train everyone in their organizations never to give any information to the public that is not fully vetted and controlled.  Government agencies have had their training budgets slashed, but the one training everyone still gets (along with diversity training) is training on how to reveal (or really, not reveal) information to the public.

But I think there is a more important reason for this behavior, and it is one I want to spend a bit of time on in part because it is one of my favorite business topics: incentives.   There is nothing in an organization that is harder to get right than incentives.  And this is doubly true of government agencies because most government agencies don't have, or don't choose to measure, any output variables.

What do I mean by output variables?  Organizations tend to measure both what I call input and output variables.   Let's consider a sales person.  An output variable is a business result, e.g. number of units sold, number of new customers added, revenue of products or services sold, gross margin of products sold, satisfaction rating from customers.  An input variable is a measure of how well process steps leading to that sale were completed, e.g. percent conformance to pricing guidelines, number of sales calls made, number of quotes produced.  If well selected, input variables tend to lead to the output variables but they don't in themselves pay the rent.

Because I am most familiar with them, I am going to use government recreation agencies like a state parks organization as an example.  I have yet to find a government recreation agency that measures its employees primarily on output variables, e.g. customer satisfaction of park visitors, fee revenue collected at park, net income of the park, change in deferred maintenance accounts, etc.  Instead their metrics are -- at best -- based on conformance to process, e.g. was the budget completed on time, was the planning process done right, was all necessary reporting done on time, etc.  I say "at best" because most government agencies have no formal performance metrics at all.  And this is where I get to my favorite incentives / metrics topic of all -- informal performance metrics.

An organization never has no performance metrics at all. They may have no formal, written standards, but every organization has to evaluate and promote talent.  If there are no formal standards, there have to be some informal or unwritten standards that are applied.  And I would argue from my experience that even when formal standards do exist, there may still be informal standards that are more important.

One informal incentive that exists naturally in almost every organization is "don't get caught in a mistake."  On its face this is one of those incentives that seem good -- sure, I would love to have an organization where no one makes mistakes.   But many companies have found that in competitive markets, allowing this informal incentive to become powerful can spell a company's doom.  It has at least two negative effects:  it limits honest communications, because people start hiding their mistakes which in turn keeps information from the rest of the organization that may need it; and it limits risk-taking, which is necessary for most companies to survive in competitive markets, because almost everything a company does to improve contains risks.  Powerful formal performance systems are one way to limit counterproductive informal incentives like this.  But many companies also put a lot of work into their communications and culture to help employees be more open to taking risks and making mistakes.   A vast portion of my communication with my own managers and employees are on this topic.  We try to make very clear the subset of mistakes that are career fatal and where we DO want risk aversion (e.g. racism, harassment, abuse, etc) and treat everything else as a learning exercise.  My response to one of my manager's mistakes is very likely to be, "sorry, that was my fault, I did a bad job of training you (or preparing you, or whatever) for that issue."

Recognize though that all of these corporate steps to head off problems with the informal incentive "don't get caught making a mistake" have largely been lessons of the marketplace.  Time warp back to the 1950's when American companies were fat and happy and not yet really faced with scrappy global competition, and you might well have found highly risk-adverse cultures where people were afraid of being caught in a mistake.  I do not have experience at companies like GM, but I would not be surprised at all to learn that risk aversion dominated the culture and that faced with market extinction, it has spent much of the time since the 1970's trying to purge this risk aversion from its culture.

But in large part, a government organization doesn't face these market corrective forces.  If an agency becomes weak and senescent, it does not get competed into oblivion, it simply goes on and on.  Maybe it gets more tax money to make up for its inefficiency, or maybe it cuts somewhere (such as deferred maintenance in public parks) to make ends meet.   Which means that in most government agencies I have worked with, informal incentives -- particularly "don't get caught in a mistake" -- are extremely powerful.

Most people are familiar with the fact that the default government answer to anything new is "No".  But did you ever wonder why?  I have heard a lot of folks say that it is because government employees are jerks or lazy under-performers or have evil intentions.  But that is really not the case.  With just a couple of small exceptions**, people who enter government are no different than people who enter private organizations.  If they do things that seem bad, it is not because they are bad people but because their information and incentives cause them to do things we perceive as bad.  Take the case of saying "No".  Without any output metrics, most government employees have no incentive to say "yes".  There is no incentive to, say, generate 20% more visitor revenue in parks so there is no incentive to approve new visitor facilities or services that might generate that revenue.  And there is every reason so say "no".  "No" is almost always safe, particularly if one does not actually say "No" but instead say something like, "well, that is an interesting idea but we need to do X, Y, and Z intensive 20-year studies first."  There is virtually no way for any government employee to get caught in a mistake saying that.  So that is the answer most of us get from the government.

Coming back to the original question, I hope this helps explain why agency employees who don't admit error act the way they do -- they are not bad people, they are normal people reacting to a bad incentive.   Imagine in my business if I, say, reversed two numbers on one of the 25 state and local sales tax returns we file each month.  When pointed out to me, I have no problem admitting the mistake because I know it is easily correctable and that it has little to do with my true performance.  But in the government world, things are completely different.  They don't have output variables.  Executives can have full successful careers running parks where the infrastructure is allowed to fall apart, the headquarters become bloated, and visitation stagnates.  But they can be fired for getting something wrong in the process.  Not very often, but just enough pour encourager les autres, particularly in an environment where there are really no other formal metrics to override this fear.

**postscript:  I have found two ways that people who enter government are different from people who enter private business  (people are more different at the end of their careers after they have been shaped by the incentives and culture for a long period of time, but I am talking about upon entry into work).  First, people who enter government tend to prioritize security (e.g. good benefits, difficult to fire) over other aspects of employment.  Note that this just tends to reinforce the risk aversion to making or admitting a mistake even more.  Second, people who enter government tend to be more confident of government solutions to problems and more skeptical of private solutions than people who enter private business.  This latter is another reason why my company, that offers private solutions for traditional government functions, hears "no" a lot.

Apparently some hot new auto company called Nikola Motors (in the class of companies to my mind like Tesla and Fiskar that have a sexy idea and a lot of cash burn) is relocating to the Phoenix area.  Ugh.  You know what that probably means:

Arizona Governor Doug Ducey and Nikola Motor Company today announced the company has selected Buckeye, Arizona for its Nikola Motor Company hydrogen-electric semi-truck manufacturing headquarters facility. The new 500 acre, one million square foot facility will be located on the west side of Phoenix and will bring more than $1 billion in capital investment to the region by 2024.

"After 12 months, nine states and 30 site locations, Arizona, Governor Ducey, Sandra Watson and Chris Camacho were the clear front runners. Arizona has the workforce to support our growth and a governor that was an entrepreneur himself. They understood what 2,000 jobs would mean to their cities and state," said Trevor Milton, CEO and founder, Nikola Motor Company. "We will begin transferring our R&D and headquarters to Arizona immediately and hope to have the transition completed by October 2018. We have already begun planning the construction for our new zero emission manufacturing facility in Buckeye, which we expect to have underway by the end of 2019."

Nikola Motor Company designs and manufactures hydrogen-electric vehicles, electric vehicle drivetrains, vehicle components, energy storage systems and hydrogen stations. The company is bringing the nation's most advanced semi-trucks to market with over 8,000 trucks on preorder.

Nikola Motor Company selected Buckeye, Arizona due to numerous factors including the state's pro-business environment, engineering schools, educated workforce and geographic location that provides direct access to major markets.

How much do you want to bet that the number 1 reason for moving to Phoenix was left off the list: taxpayer subsidies.  Yep, I have not seen the deal, but my guess is that yet another company is going to get a piece of my profits transferred over to them because they make a better photo op and press release for politicians.  I am pretty sure that the statement "[arizona] understood what 2,000 jobs would mean to their cities and state" is code for "they offered us a pile of cash".

Postscript: By the way, I do like their idea of a hydrogen truck better than Musk's all-electric truck -- that is, if they can figure out how to scale up a hydrogen distribution system.

A lot of people have been asking me about Secretary Zinke's statements about encouraging more private operation of parks.  First the good news, its a great idea.  Here is my standard 400-word essay on why:

Should National Park’s be privatized, in the sense that they are turned entirely over to private owners?  No.  Public lands are in public hands for a reason — the public wants the government, not, say, Ritz-Carlton, to decide the use and character and access to the land.  No one wants a McDonald’s in front of Old Faithful, a common fear I hear time and again when privatization is mentioned.

However, once the agency determines the character of and facilities on the land, should their operation (as opposed to their ownership) be privatized?  Sure.   The NPS faces hundreds of millions of dollars in capital needs and deferred maintenance.  It is crazy to use its limited budget to have Federal civil service employees cleaning bathrooms and manning the gatehouse, when private companies have proven they can do a quality job so much less expensively.  The US Forest Service, for example, has had private operators in over a thousand of its largest parks for nearly thirty years, and unlike state parks agencies or even the NPS, it is not considering park closures or accumulating deferred maintenance, despite having its recreation budget axed.  Why? Because its partnership program with private operators is a fundamentally sounder, lower-cost approach to park operations.

In fact, such public-private partnerships are nothing new for the NPS.  The NPS was an early innovator in this field, and currently private companies operate many of the visitor services in parks, such as lodges and gift shops.  The US Forest Service innovation, which has been copied by many agencies including most recently California State Parks, has been to turn over operations of the whole park, not just the lodge, to a private company.  These are highly structured contracts, wherein the private company cannot modify the facilities or change fees without agency approval, and must meet a range of detailed performance goals.

Most critiques of private park operations center around quality and fees.  While there certainly have been some isolated failures, in general the results have been quite good.  In Arizona, a recent poll by CampArizona.com ranked the top 10 public campgrounds in Arizona.  Of these, three of the top five were US Forest Service campgrounds run by a private operator, as was the top Arizona campground in Sunset Magazine’s “Best of the West”  (OK, I have to brag, these are all run by my company). As for fee concerns, state-run parks in California charge $30 for a no-hookup camp site.  Privately operated public campgrounds in California forests seldom charge more than $18.

My company operates over 150 state, county, and federal parks.  I encourage you to take the “Pepsi Challenge” and see some of them for yourself.  They are well-run, generally with more staff than a typical state park, and have no significant deferred maintenance backlog.  Oh, and not a single one has a McDonald’s, a billboard, or a neon sign in front of a national monument.

Now for the bad news:  I am skeptical any progress will be made, for several reasons.

1. The rank and file of these organizations are generally against private operation of any of their functions.  For a couple of reasons.  First, people who work in government tend, through a self-selection process, to be people who are more confident in government solutions and more skeptical of private solutions.  Second, agency leaders are seldom judged on things like efficiency or customer service.  I read and act on every single negative review that comes in for our operations.  It is impossible to imagine the head of Arizona State Parks (which is about the same size as our company in terms of revenue and visitors) doing such a thing.  Agency leaders get their pay and prestige based on the size of their budget and headcount, and private outsourcing even of non-core functions works against this.
2. Overcoming this skepticism takes a lot of hard work, organizational work the Trump Administration has shown itself either unable or unwilling to undertake so far.   As a minimum, change requires messaging that engages the rank and file, not just the Republican base.   In most lands agency, it would also require that they scrap their insanely useless (but time-consuming) planning processes in favor of a real portfolio planning process that assigns recreation lands to different customer segments (e.g. wilderness experience vs. high development) and then explicitly addresses where private capital and operating efficiency could help.

The good news is that I think there is a path to success.  The privatization message should offer real benefits agency personnel care about (and I am pretty sure tax reduction is not one of these).  Privatizing things like bathroom cleaning would allow the agency to stop overpaying for routine non-core tasks and allow it to free up resources for things its employees (and the public) are passionate about, like addressing the enormous deferred maintenance account in most lands agencies and reversing crumbling infrastructure in parks.  Most agency employees joined with recreation or environmental science degrees and don't want to clean bathrooms or deal with angry customers anyway.

For the public, recreators who like a lot of infrastructure and facilities are natural supporters of private operation and bringing in private capital to public lands, but the most passionate advocates for public lands are disproportionately folks who want wilderness experiences and distrust development.  That is why having a portfolio management process for public lands is so important.  The Forest Service, for example, makes every campground they own in the west look the same.  I can close my eyes and tell you what your Forest Service campground looks like even if I have never been there.  This is crazy.   Create something like a "Wild Camping" label and attach it to a subset of the portfolio and don't allow any development.  Even remove development.  Then have other sites for more developed camping.   Maybe sites that focus on first-timers or kids.  Maybe lower-cost value sites.  (People always assume that as a private operator, I want to develop everything, but I don't.  Sure I have places where we have cabins and showers and electricity at every site.  But I also operate pure primitive sites with no power, water, or even cell service.  Hell, in some ways I like operating the latter better -- less to go wrong.)

It is hard to pick out the most egregious example of bad legislation that has been considered by our state legislature, but this one is certainly close:

Claiming people are being paid to riot, Republican state senators voted Wednesday to give police new power to arrest anyone who is involved in a peaceful demonstration that may turn bad — even before anything actually happened.

SB1142 expands the state’s racketeering laws, now aimed at organized crime, to also include rioting. And it redefines what constitutes rioting to include actions that result in damage to the property of others.

But the real heart of the legislation is what Democrats say is the guilt by association — and giving the government the right to criminally prosecute and seize the assets of everyone who planned a protest and everyone who participated. And what’s worse, said Sen. Steve Farley, D-Tucson, is that the person who may have broken a window, triggering the claim there was a riot, might actually not be a member of the group but someone from the other side....

There’s something else: By including rioting in racketeering laws, it actually permits police to arrest those who are planning events. And Kavanagh, a former police officer, said if there are organized groups, “I should certainly hope that our law enforcement people have some undercover people there.’’

“Wouldn’t you rather stop a riot before it starts?’’ Kavanagh asked colleagues during debate. “Do you really want to wait until people are injuring each other, throwing Molotov cocktails, picking up barricades and smashing them through businesses in downtown Phoenix?’’

This is the sort of law that is almost guaranteed to be abused and enforced in an asymmetrical manner.  This is one of those laws where the "Am I comfortable giving my political opponent this sort of power" test is particularly useful.  Conservatives rightly complained about the Obama Administrations asymmetric IRS scrutiny on Tea Party groups, but this law would create a far greater potential for abuse.  We no longer have Sheriff Joe any more (which is one reason I don't join so many others in complaining about the election of 2016) but does anyone doubt that Arpaio would have used this law to shut down every pro-immigrant protest he could learn about in advance?

Security wall going up around the Eiffel Tower

The city of Paris is planning to build a permanent barrier around the Eiffel Tower and its two adjacent ponds in order to beef up security, replacing temporary protective structures that had been up as a result of recent terror attacks. It’s estimated that the structure, which will be bulletproof and able to stop vehicles, will cost the city 20 million euros (about $22 million). ...

Work on the perimeter is scheduled to start this fall, although plans are subject to approval. Once the project is complete, you’ll no longer be able to stroll leisurely under the massive steel tower, as you’ll first have to pass through a security checkpoint involving a metal detector and ID check before you can get up close to the base.

Nothing more romantic than a moonlight stroll under the Eiffel tower... and getting frisked by the French equivalent of the TSA.

By the way, if the Conservatives in this country need a better euphemism for their Mexican wall, here is a suggestion from the French:

While reports have said the wall be made of glass, Paris‘ deputy mayor Jean-François Martins wouldn’t confirm that to be true in a press conference last week — however, Martins did say, “It’s not a wall, it’s an aesthetic perimeter,”

If only the East Germans had been so clever with words, they might have won the Cold War.

I am exhausted with folks, particularly on the Progressive Left, judging themselves and each other based on their intentions.  Your intentions mean virtually nothing.  I suppose it is better to have good intentions than bad, but beyond that results, particularly in the public policy arena, are what should matter.  And the results of most Progressive well-intentioned legislation are generally terrible.  For example, as I wrote earlier today, poverty in this country is mainly caused by lack of work rather than low wage hours, but Progressives preen over their good intentions in introducing higher and higher minimum wages that will only serve to reduce the work hours of low-skilled poor people.

Via Mark Perry comes this great article on Progressive good intentions in Seattle collapsing into rubble.  It does not except well, so I recommend you check it out, but I will summarize it.

Begin with a libertarian goal that should be agreeable to most Progressives -- people should be able to live the way they wish.  Add a classic Progressive goal -- we need more low income housing.  Throw in a favored Progressive lifestyle -- we want to live in high density urban settings without owning a car.

From this is born the great idea of micro-housing, or one room apartments averaging less than 150 square feet.  For young folks, they are nicer versions of the dorms they just left at college, with their own bathroom and kitchenette.

Ahh, but then throw in a number of other concerns of the Progressive Left, as administered by a city government in Seattle dominated by the Progressive Left.  We don't want these poor people exploited!  So we need to set minimum standards for the size and amenities of apartments.  We need to make sure they are safe!  So they must go through extensive design reviews.  We need to respect the community!  So existing residents are given the ability to comment or even veto projects.  We can't trust these evil corporations building these things on their own!  So all new construction is subject to planning and zoning.  But we still need to keep rents low!  So maximum rents are set at a number below what can be obtained, particularly given all these other new rules.

As a result, new micro-housing development has come to a halt.  A Progressive lifestyle achieving Progressive goals is killed by Progressive regulatory concerns and fears of exploitation.  How about those good intentions, where did they get you?

The moral of this story comes back to the very first item I listed, that people should be able to live the way they wish.  Progressives feel like they believe this, but in practice they don't.  They don't trust individuals to make decisions for themselves, because their core philosophy is dominated by the concept of exploitation of the powerless by the powerful, which in a free society means that they view individuals as idiotic, weak-willed suckers who are easily led to their own doom by the first clever corporation that comes along.

Postscript:  Here is a general lesson for on housing affordability:  If you give existing homeowners and residents the right (through the political process, through zoning, through community standards) to control how other people use their property, they are always, always, always going to oppose those other people doing anything new with that property.  If you destroy property rights in favor of some sort of quasi-communal ownership, as is in the case in San Francisco, you don't get some beautiful utopia -- you get stasis.  You don't get progressive experimentation, you get absolute conservatism (little c).  You get the world frozen in stone, except for prices that continue to rise as no new housing is built.  Which interestingly, is a theme of one of my first posts over a decade ago when I wrote that Progressives Don't Like Capitalism Because They Are Too Conservative.

Postscript #2:  So, following the logic above, one can think of building restrictions and zoning as a form of cronyism.  Classic cronyism is providing subsidies to politically favored companies and restricting the ability of new competitors to arise to compete with them, granting them an effective monopoly and the ability to jack up their prices.  So what do we do with housing?  We give massive subsidies to home-owners and restrict competition from new housing that might reduce their home value, thus granting current homeowners an effective monopoly and the ability to jack up their prices.  I challenge anyone to tell me that rising home prices in Palo Alto are not driven by the exact same government actions for favored constituents as are rising prices for Epipens.

Postscript #3:  I will ask a question using Progressive terminology -- you were worried about these young renters and their power imbalance vs. development companies and landlords.  So how much more powerful are they now with a thousand fewer rental units on the market?  Consumers have power when supply is plentiful.  Anything done to reduce supply is going to reduce consumer power.

Nick Gillespie discusses the difficulty artists have had grappling with 9/11, and suggests two that did a particularly good job.  I was not familiar with the Elton John performance and it did not really move me seen today out of context from its original airing.  But I did see the documentary "Man on Wire" and think it's fabulous -- the world is made better by peaceful eccentrics and Philippe Petit's story of walking a tightrope between the twin towers is amazing.  It should be noted that he developed his overpowering vision of walking a wire between the two towers before he had ever once climbed on a tightrope.

I would like to add one more successful artistic treatment of 9/11 -- the Onion's 9/11 issue.  The issue was in its way as brave as Petit's tightrope walk, as it came out when no one was joking about the tragedy (hell, no one really attempts to address it with humor to this day).  But the Onion staff put out an amazing issue that was both funny and respectful and a spot-on tribute.

The entire archive is here, keep scrolling some of the best are at the bottom.  But even the small throwaway details are great -- who else in September of 2001 could have written the (likely spot-on) headline "Rest of Country Temporarily Feels Deep Affection for New York"?  And perhaps it is just me, but I still laugh at stuff like this, particularly in this age of virtue-signalling.

Dinty Moore Breaks Long Silence On Terrorism With Full-Page Ad

NEW YORK—Nearly two weeks after the attacks on the World Trade Center and Pentagon, the makers of Dinty Moore beef stew finally weighed in on the tragedy Monday with a full-page ad in USA Today. "We at Dinty Moore extend our deepest sympathies to all who have been affected by the terrible events of Sept. 11, 2001," read the ad, which pictured a can of Dinty Moore beef stew at the bottom of the page. "The entire Dinty Moore family is outraged by this heinous crime and stands firmly behind our leaders." Dinty Moore joins Knoche Heating & Cooling and Tri-State Jacuzzi in condemning terrorism.

Direct links to a few of the lead articles:

U.S. Vows To Defeat Whoever It Is We're At War With  (an article that highlights what is still the major problem in the supposed war on terror)

Hijackers Surprised To Find Selves In Hell

God Angrily Clarifies 'Don't Kill' Rule

American Life Turns Into Bad Jerry Bruckheimer Movie

For those who are younger and don't remember the day that well, the last article may seem a little random, but one of the odd reactions one heard everywhere on 9/11 was people saying that the jets ramming the towers and the later collapse of the towers all looked like a movie, like things we only expected to see in special effects and not in real life.

Speaking of movies, I was in Manhattan that day -- in the championship of bad timing awards, I was scheduled to make a presentation at 9am on 9/11 to a group of investors asking them to invest in our commercial aviation internet venture, making the pitch that the commercial aviation industry (which had been slumping a bit) was poised for a turnaround.  Anyway, one thing I have never seen reported much is what Manhattan was like that night.  I was stuck in the city, planning to leave the next day in the last rental car available.  I was wandering the city looking for dinner, happy I suppose to have been only lightly touched by the disaster, not knowing yet that several of my friends from business school had died that morning.  The authorities had been letting everybody leave the island through the bridges and tunnels, but no one, not even taxis or public transportation, was being allowed back in.  By the evening, the city was deserted, like a scene out of a post-apocalyptic movie.  Perhaps one car every 10 minutes came through Times Square.  The quiet was astounding, probably the quietest the city had been then or since for 200 years.

The city of Seatac (a small area of land around the Seattle-Tacoma Airport) gained national attention a while back for passing a $15 minimum wage.  Many other groups, including the city of Seattle itself, as well as this year's Democratic platform committee, cited the Seatac example as an impetus for higher minimum wages everywhere.

In today's politics, there is no better way for a Leftish politician to virtue-signal than to advocate for a $15 minimum wage.  It is a classic case of a government law that helps a few easy to identify people and hurts a whole bunch of people in ways that are hard to attribute to the law, such as reduced employment for low-skill workers and higher prices for consumers.

So the City of Seatac has been taking a victory lap over the last year, patting itself on its back for how caring it is of its citizens.  Oh, and it has also been doing this:

A three-month-long civil trial revealed the shadowy subterfuge behind a secret land grab that was orchestrated by the city of SeaTac, replete with backroom deals, baldfaced deceptions, and a mayor intent on driving Somali refugees from the neighborhood.

The aim of it all: to wrestle 4.23 acres of prime real estate from entrepreneurs Gerry and Kathy Kingen, according to the judge and jury who heard the case.

The West Seattle couple sued the city and won, proving in court that SeaTac officials intentionally sabotaged their development plans, strong-armed them into giving up their property and then violated the state’s Public Records Act by withholding city emails and documents proving the deception.

The trial judge also concluded the former SeaTac mayor wanted condos built on the site, believing they would price out Somalis who had moved into “his neighborhood.”...

In March 2004, K&S Developments [the Kingen's investment vehicle] began working with SeaTac’s planning department to get approval for [a] park-and-fly, and city officials “voiced support and encouragement” for the proposal. The judge noted there “was never any public opposition” to the plan.

But unbeknown to the Kingens, SeaTac’s planning director, city manager and other staff decided in late 2005 they didn’t want K&S to build the park-and-fly because it would create competition for a park-and-fly the city wanted to build about a mile south at South 176th Street.

So in February 2006, city staff “devised a secret plan” to get the City Council to pass a moratorium designed to kill the Kingens’ park-and-fly project, the judge wrote. After learning of the permanent ban, Gerry Kingen met with members of the City Council and then-Mayor Gene Fisher, who “promised to make things right.”

 

How often does Amazon fail to deliver Prime shipments in two days?  I have no idea -- I know it has happened to me sometimes, but they don't publish the metric.  What is the average wait time on the phone with the IRS?  We don't know.  What is the average wait time at a TSA checkpoint?  We don't know.

One thing we most certainly do know, and can know any time on any day, is the current wait time for any Disney ride.  I bring this up because some goofball in the Obama Administration made this absurd statement trying to justify the lack of transparency for VA wait times:

When you go to Disney, do they measure the number of hours you wait in line? Or what’s important? What’s important is, what’s your satisfaction with the experience?” McDonald said Monday during a Christian Science Monitor breakfast with reporters. “And what I would like to move to, eventually, is that kind of measure.”

Bruce McQuain rightly points out the downside of a longer wait for Space Mountain is just a tiny bit lower than the downside of waiting for heart surgery.

But I want to add that this statement is not even close to being factually correct on its face.  Here is an example of a site that has Disney ride wait times in real time, but there are dozens of apps and sites with this info because Disney makes the data public in an API most anyone can access.  (My favorite is Touring Plans, which has built a whole Disney trip planning business on top of Disney published wait time data -- as an aside, if you are a Disney fan or future visitor, you should join).

But I would go further.  I know for a fact that Disney spends a ton of time internally planning and improving ride throughput and capacity entirely with an eye to reducing wait times (and also, by the way, to making design changes that make ride waits more enjoyable with in-line activities).  They have a sophisticated operational research staff working on this all the time, and they are constantly tweaking their Fastpass system which would not even begin to work correctly if they did not understand ride wait times down to the second decimal place.  And by the way, if their management found out that some folks in their organization were fudging line wait time data, I am pretty sure the offenders would not be working there any more (as they are at the VA).

Postscript:  I am still amazed by the fail here.  Anyone who has been to Disney even once will know that all wait times are displayed all over the park on boards, and that at each ride, every few minutes a customer will get an electronic card at the beginning of the ride that precisely times their wait.   Seriously, where do they get folks like this who can blithely utter nonsense as if they know what they are talking about.  The whole premise is screwed up.  Yes, good service companies measure overall satisfaction. This is marginally useful data, but what does one do with it?  To really fix and improve the experience, one also has to measure many important bits of the experience.  Saying that one should pay attention to only one output metric and nothing else would get you laughed out of any quality course I have ever been to.

Update:  Also, I would add that there is a lot of market pressure on the wait time issue pushing Disney to improvement on lines, market pressure that does not exist on the VA (which is one reason they totally lack any accountability).  Disney has its FastPass system for helping guests manage ride waits, but both Universal and Six Flags have their own different systems (Universal has a higher level ticket you can buy that gets you preferred access to all rides, Six Flags Magic Mountain has a pager system where you tell it which ride you want to do next and they page you when your place is ready).

A lot of folks have been asking for my thoughts on this conflict, where Delaware North, the departing concessionaire at the Yosemite Lodge, is claiming they own trademarks associated with the old, beloved lodges that must be bought out for lots of money, either by the government or the new concessionaire.

There are lots of versions of National Park Service (NPS) concession contracts floating around out there, and as I have had a few of these contracts, I am generally familiar with the terms and problems that arise (though I want to caution I am not privy to any insider details of this dispute).  But here are a few thoughts:

One of the hardest problems with government concession contracts is how does the government provide incentives for the private company to invest capital in the concession without giving the concessionaire a long-term contract that reduces the government's control.  Since any improvements made to the government land can't be removed and become the property of the government, it probably takes a 30-year contract to cause private companies to want to make such investments (as they would then have time to get a return from the assets, and most improvements tend to have a 20-30 year life anyway).  But the government does not want to lock themselves into one concessionaire for 30 years - 10 is as far as the NPS generally wants to go.

So the NPS has a process by which private companies can make permanent investments in the facilities, and the amount of these investments are added to an account (it used to be called Leasehold Surrender Interest, or LSI, so I will call it that -- I am not sure what it is called in current contracts).  At the end of the contract, there are some formulas for valuing the LSI in the account, and if the concessionaire loses the contract, the next concessionaire has to buy out the LSI.  If there is no next concessionaire, the Feds have to buy it out.

This provides good incentive for investment, because money you put in you basically get out at the end, plus any return in the middle.  Also, since there is a federal guarantee of repayment, this makes it possible to get a bank loan to finance the improvements (otherwise an investment in leasehold improvements on government land that the bank can't put a lien on is impossible to get bank financing for).  But this also creates problems.  Over the years, the LSI can grow so huge that it becomes impractical for anyone to buy out -- the LSI numbers at these large concessions can be in the hundreds of millions of dollars.  This is what happened at the Grand Canyon, when the US Government had to pay down the LSI by tens of millions of dollars to get companies to bid.  The other issue is that it creates a large, unfunded, off-the-books obligation for the government (because they ultimately back repayment of the LSI) in the billions of dollars.

Anyway, it is my understanding that it is not the LSI that is the problem here.  NPS contracts also for years had a provision that not only did one have to buy out the previous concessionaire's LSI (which represents investments in permanent facilities), but one also had to buy all the personal property he had associated with the concession (eg boats, trucks, inventory, shelves, coolers, etc).  While the LSI provision is generally sensible, though with some issues, this personal property buyout often led to disaster.  Because, unlike LSI, there is no agreed-upon value for the property (if the NPS is following its process, they can tell you at any point in time what the LSI is worth and everyone should be in agreement -- no similar process exists for valuing personal property of the concession).

So here is the situation.  The outgoing concessionaire has an asking price for his personal property, and the incoming concessionaire has an offer price likely well south of the seller's price.  In a normal transaction, there is some negotiation.   But a key part of the negotiation is that at some point the buyer can just walk away and refuse to buy.  This walk-away is not allowed in the NPS contract situation.  The incoming guy HAS to buy.  So outgoing concessionaires, particularly unscrupulous ones, will set a huge asking price and refuse to come off it.  Arbitration is possible, but mediators often split the baby in a way that sellers still get above-market rates for their stuff.  And all the while this takes time -- one is supposed to be opening the concession and we have not even secured rights to the assets we need to run it!  So the clock is ticking AND we can't walk away.  Incoming concessionaires often get hosed  (which is why I believe new contracts in the NPS do not include this personal property buy-out provision).

This happened to us at a NPS marina in Colorado.  The previous concessionaire ran a number of businesses in the area.  When they lost the concession, they stripped it of any good assets it had and then went around to all of its other businesses and gathered up all the junk and useless assets they could find and dumped them into the concession.   They then demanded a huge price for all this junk.   The NPS was absolutely no help -- they had no records of concession assets, and with turnover no one had even really visited the concession much.   We ended up taking a loss in the $200,000 range, buying a whole yard of stuff that we almost immediately had to pay to have carted to a junk yard.  Later we found that we were on the hook for almost a half million in facility repairs the previous company had never made -- the NPS had detailed notebooks of the failed inspections and required maintenance that was never performed, but never once disclosed any of this to us until we had signed the contract, and then demanded that we were on the hook for it all.  But that is another story, which goes to explain why I will never, ever work with the NPS again.

Anyway, my take is that Delaware North is doing the same thing that happened to me in Colorado, but on a larger scale -- writing up the price of a bunch of assets (in this case intellectual property) and using the terms of the bad NPS contract to extract above-market pricing for them from the next concessionaire.  All entirely legal, but at the cost of absolutely destroying their reputation with the NPS (I wonder if Delaware North is planning to exit the NPS concession business anyway such that they don't care).  Anyway, the new concessionaire, Aramark has certain advantages that I did not have as a small company.  In particular, they can simply refuse to buy the assets (which they have -- they have already renamed all the lodges and stores) and fight the issue in the courts later.

By the way, if you are wondering how the US Government can be so casual with trademarks and intellectual property, this tends to be, in my experience, a huge blind spot for them.  As an example, the US Forest Service uses a single national reservations company and all of us concessionaires in the Forest Service are required to use that company.  Years ago, the company who won the contract promised better information on the website about each campground.  So, for the hundred plus campgrounds we operate, at the request of the US Forest Service, we spent weeks measuring sites, taking pictures, and drawing campground maps for posting on the reservation system.  Several years later, when this reservation company lost the contract, it turns out the company had contract provisions from the government that the believed let them retain all the intellectual property.  The company then claimed all the maps, pictures, and site descriptions -- that we developed -- were theirs.  What a mess.  I can't totally remember how it came out but I think we got the rights to the pictures and descriptions back but all new maps had to be made.  The point is that the government has historically been myopic about the value of non-physical assets.

Because about 5 seconds after they are passed, government officials are scheming to use the laws against non-terrorists to protect themselves from criticism.

Twenty-four environmental activists have been placed under house arrest ahead of the Paris climate summit, using France’s state of emergency laws. Two of them slammed an attack on civil liberties in an interview with FRANCE 24....

The officers handed Amélie a restraining order informing her that she can no longer leave Rennes, is required to register three times a day at the local police station, and must stay at home between 8pm and 6am.

The order ends on December 12, the day the Paris climate summit draws to a close....

Citing the heightened terrorist threat, French authorities have issued a blanket ban on demonstrations – including all rallies planned to coincide with the climate summit, which Hollande is due to formally open on Monday.

This justification is about as lame as them come:

AFP news agency has had access to the restraining notices. It says they point to the “threat to public order” posed by radical campaigners, noting that security forces “must not be distracted from the task of combating the terrorist threat”.

Note that the police had absolutely no evidence that these folks were planning any violence, or even that they were planning any particular sort of protest.  This was a classic "round up the usual suspects" dragnet of anyone who had made a name for themselves protesting at green causes in the past.

Postscript:  Yes, I know that these protesters and I would have very little common ground on environmental issues.  So what?  There is nothing more important than supporting the civil rights of those with whom one disagrees.

And yes, I do have the sneaking suspicion that many of the very same people caught up in this dragnet would cheer if I and other skeptics were similarly rounded up for our speech by the government.  But that is exactly the point.  There are people who, if in power, would like to have me rounded up.  So it is important to stand firm against any precedent allowing the government to have these powers.  Else the only thing standing between me and jail is a single election.

Update:  Think that last bit is overly dramatic?  Think again.  I can guarantee you that you have some characteristic or belief that would cause someone in the world today, and probably many people, to want to put you up against the wall if they had the power to do so.  As proof, see:  all of history.

Last year, when Congress did a 1-year renewal of legislation governing public recreation and fee policies (FLREA) they left out a tiny provision that discouraged government agencies from taking back tasks they had privatized.  With that gone, parts of the USFS immediately began to move to bring certain operations back in house, even when doing so required that they both spend more tax money AND reduce services levels to the public.  Such is the strength of incentives in any government bureaucracy to expand their scope, staffing, and budget, even when it makes no sense for the public.

This week in an article at PERC, I tell one such story in depth. Here is an excerpt:

Consider one example: The Tahoe National Forest in California recently took the operation of some of their parks out of private hands, ending a nearly 30-year partnership with one of our competitor companies.

Did the Forest Service do it to save money? The private concessionaire operated entirely with the user fees paid by visitors, using no taxpayer money, and even paid rent back to the government. The agency’s in-house operating plan for running these campgrounds requires at least $2 million in taxpayer money over the next five years to supplement user fees.

Did they do it to improve service? The private concessionaire employed more than 60 paid workers living on site, with managers who worked weekends and holidays. The Forest Service plan calls for half this number of paid employees, and none will live on site or work weekends—the busiest time for recreation.

Did they do it to address some egregious for-profit abuse? The agency is actually planning to replace dozens of paid private workers with volunteers. At the same time that the federal government is mandating higher minimum wages for campground concessionaires, the Forest Service is replacing paid workers with unpaid labor.

Did the Forest Service do it to keep user fees low? The original stated reason for kicking out the private operator was the concessionaire’s request to increase user fees in response to recent increases in California’s minimum wage. In the end, however, the Forest Service raised fees even higher than those proposed by the concessionaire.

After years and years of happy service, my Logitech MX Anywhere mouse finally gave up the ghost.  So I bought a new one, though I purchased the new MX 2 thinking it would be new and improved.

Wrong!  At least for me.  The old mouse used a single AA battery that lasted months and months.  By keeping 1 extra AA battery in my backpack, I was able to make sure my mouse would always work.  Now, though, the new MX 2 mouse has a built in battery that has to be charged with a charging cable.  And if it runs down (which is always possible since there is no charge indicator)?  Then you have to plug it in with a cable to recharge, and the mouse does not work while charging.  Basically, if you were planning to work in your hotel room that night, you are out of luck.

Already, I have to remember to plug in my cell phone, my iPod, my iPad, my TV remote, my Jabra earphone, etc.  I don't want to have to charge something else!!

A plug-in rechargeable battery is NOT necesarily better than using a couple of double A's.  I have the same problem with my home theater remote (also Logitech).  My old versions used to use replaceable batteries, so I could just leave it on the coffee table.  The new remote require a charger.  But I have no outlets within 10 feet of my coffee table, so now I have to keep the remote in the kitchen, one room over.  Stupid, stupid, stupid.

Bruce McQuain has an article on how McDonald's is closing some contract-operated fast food outlets at military bases.  The article speculates that the closures on new government minimum wage regulations for government contracts.

Frankly, I doubt this explanation.  I know something of the world of government contracting, and contractors in these cases routinely just pass on wage increases to their customers in the form of higher prices.  After all, their contracts give them a monopoly of sorts in these bases.

I would like to offer an alternative explanation.

In March, a new regulation took effect that all contractors with anything larger than a $50,000 a year contract with the government must go through an expensive affirmative action planning process for ALL of their locations, not just for the people involved in that particular contract (41 CFR 60-2.1  and 41 CFR 60-4.1)

We don't do government contracting work.  We lease government facilities, but get paid 100% by customers -- since we don't take government money, we are not a contractor.  But there is one exception.  We have a $52,000 a year contract to clean bathrooms near the campgrounds we operate in California.  Basically, we bid this contract at cost because we want the bathrooms cleaned well -- if they are not, it hurts our nearby businesses.

In this contract, we have government-mandated wage requirements under the Service Contract Act.  When these mandated wages go up, we just raise the price to the government in proportion.  No big deal.

We were informed that having this contract, under the new March Obama regulations, now made us liable to go through an expensive and time consuming affirmative action planning process for every location -- of which we have over 120 -- not just for this one contract.  So this one contract was going to force us to create 120 annual written plans and presumably get them approved by someone in the government.  No way.  I might have done it if I only had to do a plan for the contract, but it is just too much work to do this everywhere merely because I have a $52,000 contract on which I make no profit.  So we told the Feds we were dropping the contract.

I think it is very unlikely that private businesses will be accepting government contracts as 5 or 10% of their business any more.   This new regulation just imposes too much cost on the other 95% of the business.  Many will drop the government contracts.

I wonder if this is what is really going on with McDonalds.  A regulatory requirement that applied just to the base operations, like a minimum wage, strikes me as manageable.  But having these three or four contracts drive an expensive requirement to create some sort of affirmative action plan for every location - essentially every one of their tens of thousands of stores, so tens of thousands of plans - that would drive them out of these contracts VERY fast.

For several years I have feared that my high-deductible health insurance would be illegal.  I am a big believer in high deductible insurance.  First, it is real insurance, requiring that I pay day-to-day expenses but protecting me from catastrophic bill.  Second, it improves the health care system by providing incentives for consumers to actually price-shop services.

Well, I was wrong.  In fact, most people see to be getting higher deductibles than they want.

My only excuse is that the Obama Administration has acted for three years as if they hated high-deductible health coverage and were planning to make it go away.  Kathleen Sebelius has said on a number of occasions that it is not "real insurance" (she believes that insurance should actually be pre-paid medical care).  Seriously, here is an example of what she was saying:

At a White House briefing Tuesday, Health and Human Services Secretary Kathleen Sebelius said some of what passes for health insurance today is so skimpy it can't be compared to the comprehensive coverage available under the law. "Some of these folks have very high catastrophic plans that don't pay for anything unless you get hit by a bus," she said. "They're really mortgage protection, not health insurance."

She is saying this all while the policies being prepared for the exchange were exactly the kind of coverage she was speaking out against.  And she had to know -- I cannot believe a former state insurance commissioner was not looking at what policies were being prepared for the exchange.  After all, her organization made the last minute decision to hide policy pricing from the public (e.g. deleted the window shopping functionality) and this almost certainly was in response to seeing the policies being prepared for the exchange and realizing the pricing and features were not going to make people happy.

By the way, there is a certain schizophrenia here that is entirely political:  These new policies have a $10,000 deductible, but they pay 100% for condoms?    They may well be creating a combination of catastrophic insurance and pre-paid medical care that has the worst of both approaches.

Politicians lie.  But what is it about this administration that lies in ways that are inevitably going to be discovered, in just a few months?  Can they really be so focused on getting through each individual news cycle that this kind of behavior makes sense?

I have seen several stories of late suggesting that minimum wage phase-ins tend to mask the full employment effects of the wage change.  That is because people tend to look at employment before and after the wage change itself, when in fact many companies may have already adjusted their employment long before the wage change goes into effect based on the original announcement.

This certainly rings true with me.  We decided to close one operation in California after the state passed legislation to raise the state minimum wage (the minimum wage change was one of three factors leading to the closure, the other being the PPACA employer mandate which would be particularly expensive at this location and vexing litigation harassment in this one particular area).   This means that for a minimum wage change that does not take effect until July 1, 2014, our decision to reduce staff came in the fall of 2013 and the jobs will go away on December 31, 2013, months before the minimum wage change actually takes effect.

I can certainly see how this would make designing a study to capture the employment effects of the minimum wage change very difficult.  From a more cynical point of view, it also makes it far easier for minimum wage supporters to understate the employment effects.

This same phase-in effect can be seen with the Obamacare employer mandate.  I criticized Brad Delong for arguing that we would not see any shifts to part time labor until the employment report after the actual start date of the employer mandate.  But I know our company had been shifting people to part-time status in anticipation of the start date nearly a year earlier, as had most other retail businesses.  While it may be normal for the government to put off working on something until on or after the due date (e.g. the Obamacare web site), private industry tends to start planning and implementation of responses to government regulations months or years in advance.

I think it is now clear why the Administration could not delay the exchanges, even when Republicans essentially cast them a lifeline during the budget debate by trying to delay the mandate by a year:  I think the Administration knew that a massive wave of insurance policy cancellations were already in the mail, and that the recipients of these letters would be facing huge price increases for their policies.

It is telling that the one thing you are NOT hearing from Administration officials in response to the policy cancellations is surprise.  If they were surprised, they would be yelling stuff like, "what the hell are those insurance companies doing?"  They knew this was coming, and you get the sense they were grimly bracing for it to be made public, hoping that perhaps their friends in the media would not make a big deal about it.

The minimum requirements on health plans that is driving these cancellations cannot at this point be cancelled.  Or, put more precisely, they could be cancelled but the act would be meaningless, because insurance companies have no way to suddenly go back to the old policies and pricing.  It takes too much planning to work out their product line and they can't just switch back on a dime.

So the huge wave of cancellations and price increases in the individual market was unstoppable.  That being said, the Administration has to be able to offer an alternative, and the only one they have is the hope one might get his or her new policy subsidized by other taxpayers.  But that is only possible through the exchanges.  So that had to be allowed to go forward and made to work, somehow.

There is no fix to this mess.  This is an avalanche that was loosed three years ago and cannot be stopped.

The Florida auditor sitting in my one-man office was shocked to learn I would not be in the rest of the week.  I said you scheduled the audit visit for today, so I changed my plans and am in the office today, but leave tomorrow.  Apparently she assumed that the audit schedule gave her the right to stay as long as she wanted.  She was planning to sit in my office for another 2-5 days.  I told her sorry, but if she wanted to book 5 days, she should have booked five days.  And by the way, if she had tried in advance to make me sit dormant in my office all week, I would not have agreed to the visit.

This is just insane in an Internet world.  Everything she asked for in advance was sent to her electronically.  Even though she is sitting right next to me, her requests to me for more data have come by email.  I can't figure any reason why she is even here, unless Florida finds it cheaper to fly her around and use other people's offices rather than provide her with one of her own.

By the way, this is fairly typical of a lot of government workers in my experience.  If they block a meeting on their calendar for the whole afternoon, they want it to last the whole afternoon.  There are a lot of jobs out there where people are most comfortable proving their worth by showing that their calendars are always full.

Via Walter Olson

Can websites be forced to change to accommodate the disabled — by using “simpler language” to appeal to the “intellectually disabled or by making them accessible to the blind and deaf at considerable expense?

Apparently, the White House is gearing up to force costly changes on websites in the name of ADA compliance.   The implications could be staggering, and in certain scenarios would basically force me to certainly close down this site, and likely close down many of my business sites.

Generally, the First Amendment gives you the right to choose who to talk to and how, without government interference. There is no obligation to make your message accessible to the whole world, and the government can’t force you to make your speech accessible to everyone, much less appealing to them. The government couldn’t require you to give speeches in English rather than Spanish …

But now, the Obama administration appears to be planning to use the Americans with Disabilities Act (ADA) to force many web sites to either accommodate the disabled, or shut down.

Yes, more evidence that the PPACA is ending full-time work in the American retail service sector

Circle K Southeast joined a growing list of national companies shifting workers to part-time status this week, in order to avoid paying Obamacare’s mandatory benefits, CBS-WTOC reports.

The alternative is to pay a $2,000 fine per fulltime worker who is not covered, leading Circle K to become the latest in a long line of companies to slice employee hours to avoid increased costs.

Here was my article several weeks ago in Forbes, though I have been predicting this since last year (when my own company started planning for the same change).

First, I have always enjoyed the SimCity games.  Sure, I know that these games take a planning and technocratic control approach that I find distasteful in real life, but I enjoy playing first-person shooters as well despite being a pacifist.

So I have been extremely disappointed in their implementation of their new version.  In this sort of mad rush to be like all the other games out there, SimCity built in a multi-player mode where you play online interacting with neighboring cities run by other players.   This is all fine as far as it goes, thought the appeal escapes me so far.

But the true fail is that they require players to log in and play online on their servers, even when playing solo.  What was an irritant yesterday became an enormous mess today, as every North American server for the game is full.  Run the game, and you immediately get hit with a pop-up window with a counter forcing you to wait in what is at least a 20-minute queue before you can play.  There is no offline mode - even if your intent is to play solo, you have to wait for a spot to open up on their multi-player servers.

At this point I would seriously recommend that you wait before buying this game.  Combined with other irritants (the game is not available on Steam, you have to use Origins far inferior proprietary clone), and the game's high price, I am sorry I pre-ordered and did not wait for reviews to come in.  It may eventually be a good game, but I am not going to pay $70 to stare at a 20-minute count down clock every time I want to play.

Update:  Most online games allow players to pre-load the game several days prior to when the servers are turned on.  This smooths out the load on the download servers.  Apparently Origin did not do this, and the servers for downloads crashed yesterday (these are different from the play servers which are full today).  Apparently Origin was still "polishing" the code right up to the hour of launch, which is code for, "this is likely still a bug-filled mess."

I often tell folks that while the taxes in California are irritating, what has really killed my interest in expanding in California is the regulatory burden.  It took 3 years to get through Ventura County planning department to get permission to put a modular ticket booth in a corner of an existing parking lot -- only to be denied.  I have faced potential prosecution because we demolished an unsafe deck without state permission.  I now have to fire people who try to work through lunch or else face employees suing  me (successfully!) later for their voluntarily working through lunch.

I think that is why I enjoyed this blog, SLO Leaks, so much.  It is a 3-1/2 year story of an obviously wealthy gentleman trying to get the local planning board and later the California Coastal Commission to allow him to build a house on his residential-zoned land.  I sat up for hours last night reading through it.  42 months and $3 million later, he still is not even close to having his approvals.  It is interesting to see his respectful-of-authority tone shifting over time, until at the end he is writing about how he has shifted his company's new office and expansion from California to Texas.

Here are a few nuggets.   Here is what he is up against:

Once a year the Public Works Dept gives a report on what has happened in the previous year in the Avila Beach area. One part of their report is on how many building permits were issued. In order to get a building permit you first have to get a minor use permit through the Planning Dept, so this is a good gauge of how much work the Planning Dept does. So for the period from July 1, 2010 to June 30, 2011, in the Avila area, which has Ryan Hostetter as a full time planner, the entire list of building permit issued is here:

One single family residential permit was issued during the entire year.

That’s it. No commercial buildings, no office building, no barns, just one single family house permit. And it wasn’t my permit, that’s for sure – because I am now going through the potentially years long Coastal Commission permit appeal process before I can even apply for a building permit.

And this:

So after waiting nearly a year, Daniel Robinson, who is a low level bureaucrat with the California Coastal Commission, and who had never even been to the house site, and who had never even met me or my wife, has told me that he doesn’t like my front yard, he thinks the retaining walls are too big, he thinks my house is too big, and that he doesn’t like the overall design of my house. Daniel thinks that my house should look more like a farm house, and also that people walking around in the city of Pismo Beach will be offended by the mere sight of my house (so called “visual impact”). And if my house design doesn’t please him then he will recommend to the full Coastal Commission that they deny my permits. Since I will only get 3 minutes to defend my house in front of the Coastal Commission I would then probably lose that permit appeal vote and I will be unable to build my house at all, and I will lose about $3 million, and will have wasted years of my life.

The California Coastal Commission is perhaps the most capricious and authoritarian government entity in the country, for example:

But then there was the minor issue of a permit for Daly City, a suburb of San Francisco, to rebuild a rock retaining wall that had been damaged during the last winter storms. It was such a minor issue that Daley City didn’t even send a representative to the CCC meeting. What could possibly go wrong?

The rock retaining wall was to protect a dirt and gravel road that follows along the coastline. On the other side of the dirt road is an abandoned landfill that Daley City capped over in the 1970′s. And I watched the Coastal Commission, apparently on a whim, decide to overrule their staff and instead of issuing a permit they decided to require Daily City to dig up the entire landfill and relocate it inland somewhere. Where it got relocated to the Coastal Commission didn’t care – since that isn’t their problem. And the estimate to do this landfill relocation is $125,000,000.00!

$125,000,000.00 works out to $1250.00 for every man, woman, and child in Daly City. And the Coastal Commission decided that this must happen with about 10 minutes of discussion amongst themselves and without a single fact to cloud their minds! It was both unbelievable and terrifying.

From all the facts, it looks to me like he is never going to get approved.  But you can get quick approval from the  CCC -- if you are rich and have political juice

Like me, [Steve Blank] is in the high tech industry. Like me, he has started several high tech companies....

After Steve sold his last startup company he applied for a permit to build a house in the California Coastal Zone in 2000. And, just like me, Steve’s land use permit was appealed to the California Coastal Commission. The reason for the appeal was “sensitive habitat” issues. (I don’t have any sensitive habitat issues because my proposed house is in the middle of a field of non-native weeds.)

Unlike me, Steve’s appeal to the Coastal Commission went pretty smoothly. He had his hearing in only 8 months – start to finish. It has taken me a year and a half, after waiting a year and a half for SLO County to issue the permit in the first place. And there were no onerous “Special Conditions” imposed on Steve by either San Mateo County or the Coastal Commission.

Here is the list of “Special Conditions” that the Coastal staff wants to impose on me.

Superficially Steve’s house and my house are similar. I have a main house and a barn on 37 acres, Steve has a main house, two barns, and a farm labor house. But Steve’s house is 15,780 sq. ft., with a swimming pool, and a 2,500 sq. ft. barn, and another 3,040 sq. ft. barn 31 ft. high, and a 1240 sq. ft. farm labor house all on 261 acres. So Steve’s house is around 3 times larger than my proposed house (and much taller). Steve also got to have a fence and there was no requirement for public access. And Steve was able to build his house to look anyway he wanted. No “rural agricultural theme” architecture for Steve, that’s for sure. Steve can also plant in his yard pretty much any damn thing he wants.

Steve is pretty proud of his house. A picture of his house is the banner to his web page, which ishere. You can see the front gate of his house here. And this is an overhead view.

Steve Blank is one of the current California Coastal Commissioners.

From Megan McArdle:

When I was reporting on Wall Street, I used to be told with some regularity that government was needed to counteract the short-term thinking of the business sector, who never thought much beyond the next quarterly earnings report.  This now seems as quaintly adorable as picture hats and daily milk deliveries.  An ADHD day trader with a cocaine habit and six months to live has considerably more long-term planning skills than our current congress.