Coyote Blog

The act of shopping is often denigrated by the literati as shallow and self-indulgent.  But shopping is at the very heart of why a free market works.  It enforces discipline on suppliers because they buyers will be comparing their price and quality and feature set to their competitors.

In health care, we have all but ended the act of consumer shopping.  Most of our medical expenses are paid by third parties, and we are just not very careful when spending other people's money.  These third parties sometimes try to be diligent about what we pay, but it is a losing task and in doing so they end up irritating everyone.

And thus, we get this:

You can find it on the Internet for $250 or less. But if Medicare is paying, a standard-issue brace for back patients costs more than $900.

In a report expected Wednesday, federal investigators say Medicare paid an average of $919 for back braces that cost suppliers $191 apiece, providing a window on how wasteful spending drives up health care costs.

“The program and its beneficiaries could have paid millions of dollars less if the Medicare reimbursement amount … more closely resembled the cost to suppliers,” says the report from the inspector general of the Health and Human Services Department. The Associated Press obtained a copy.

I discuss the phenomenon in health care more in this part 1 on a three part series I wrote at Forbes

The various cities in the Phoenix metropolitan area have spent a fortune renovating ten spring training fields for 15 major league teams.  I have seen a number like $500 million for the total, but this seems low as Scottsdale spent $100 million for just one complex and Glendale may have spent as much as $200 million for theirs.  Never-the-less, its a lot of taxpayer money.

The primary subsidy, of course, is for major league teams that get lovely facilities that they use for about one month in twelve.

But these subsidies always get sold on their community impact.  But that economic impact turns out to be really narrow.  For in-town visitors, the economic impact is typically a wash, as money spent on going to sports games just substitutes for other local spending.  But these stadiums are held up as great economic engines because they attract out of town visitors:

Cactus League baseball and year-round use of its ballparks and training facilities add an estimated $632 million to Arizona economy, according to a study released Monday by the Cactus League Baseball Association.

The study found that 56 percent of the 1.7 million fans attending games this past spring were out-of-state visitors and the median stay in metro Phoenix was 5.3 nights.

Spring training accounted for $422 million in economic impact in 2012, up 36 percent from the previous study in 2007. Both were done by FMR Associates of Tucson.

One of the flaws of such studies is they never, ever look at what the business displaces.  For example, for local visitors, they never look at local spending sports customers might have made if they had not gone to the game.  All spending on the sports-related businesses are treated as incremental.   For out-of-town visitors, no one ever considers other visitors coming for non-sports reasons who are displaced (March was already, without all the baseball, the busiest hotel month in Phoenix) or considers that some of the visitors might have come to the area anyway.

However, let's for one moment of excessive credulity accept these numbers, and look at the out of town visitors.  56 percent of 1.7 million people times 5.3 nights divided by 2 people per room is 2.52 million room nights, or at $150 each a total of $378 million.   So most of their spring training economic impact is hotel room nights.  This by the way is the same logic that supports various public subsidies of local college bowl games.

Which begs the question, why are we spending upwards of a billion dollars in taxpayer money to subsidize sports teams and hotel chains?  If the vast majority of the economic impact of these stadium investments is for hotels, why don't they pay for them, or split the cost with the teams?

PS- as an aside, it seems that to be successful in the corporate state, one needs ready access to consultants who will put absurdly high numbers on the positive impact of one's government subsidies.  It's like money laundering, but with talking points.  Take your self-serving spin, hand it with a bunch of money to a consultant, and out comes a laundered "study".  In this case, the "study" architects are FMR Associates, which bills itself as specializing "in strategic research for the communications industry."  The communications industry means "PR flacks".   So they specialize in making your talking points sound like they have real research behind them.  Probably a growing business in our corporate state.

Last week I mentioned that my dad had passed away.  I had not really meant to make a big deal about it on my blog, but I wanted to give my support for the oral history idea.  However, a lot of you expressed support and condolences, for which I am thankful, and were curious about my dad from some of the small references I dropped.  I didn't answer any of the friendly requests I got for information, mainly because dad was so private about his life and accomplishments that it seemed odd for me to do anything but the same.  But his obituary appeared this weekend in the Houston paper so I thought I would share that for those who are interested.

I have never been convinced that IQ tests have really distinguished core intelligence from education.  I scored much better on IQ tests after I practiced and read about how to tackle certain types of problem.

It is for this reason that I have always assumed the Flynn effect to be due to education, not changes in native intelligence.

Dealing with facile arguments that are supposedly perfect refutations of the climate skeptics' position is a full-time job akin to cleaning the Augean Stables.  A few weeks ago Kevin Drum argued that global warming added 3 inches to Sandy's 14-foot storm surge, which he said was an argument that totally refuted skeptics and justified massive government restrictions on energy consumption (or whatever).

This week Slate (and Desmog blog) think they have the ultimate killer chart, on they call a "slam dunk" on skeptics.  Click through to my column this week at Forbes to see if they really do.

I will quote from Don Boudreaux (who was in turn commenting on his own quote of the day, which happened to be from Brink Lindsey, my old college roommate).

In other words, very many people – nearly everyone on the political left, yet plenty also on the political right – remain creationists.  They continue to fail to grasp the nuances, deep meaning, and full implications of the science of spontaneous order that first flowered among scholars in 18th-century Scotland.

Yesterday I mentioned the Doublespeak definition of insurance as used in the health care field, when a public policy person can say with a straight face that a particular health care policy is "bad" because it only covers catastrophes.  Finem Respice had a good article several years ago on the history of insurance and current efforts to affect redistribution through mispricing risk.  The article is written about housing but could easily have been about health care as well.

No one has put a number on this, but my gut feel is that the largest new source of funding for health care in the plan is not new taxes (though they are large) nor price controls on doctors (though these are onerous) nor deficit spending (though this is likely to be substantial) but an implicit premium subsidy from young to old.  Since insurers are extremely limited in how much they can raise the price to risky groups, healthier and younger people will have to pay absurdly high premiums for what they get to subsidize the policies of the old and sick.   In a normal market young people would just refuse to buy such policies -- thus the individual mandate.  They must be forced to buy them, because their purchase of these overpriced, and to them, likely useless policies will fund most of the system.

This is a highly instructive story about Wal-Mart dropping health coverage for part-time workers (hat tip to a reader -- I always forget to ask if they are OK having their name used).  The writer is amazed at unintended consequences that were so hard to envision that complete non-experts like me predicted them days after the law's passage.

• The writer is amazed that Wal-Mart would support Obamacare and then try to evade its provisions.  This is how the corporate state works.  Wal-Mart was an enthusiastic supporter of Obamacare NOT because it believed the law made any sense, and not because it had any intention of complying with its spirit, but because it knew that its size, political clout, and infrastructure would allow it to duck the new costs of Obamacare more easily than its competition.
• We see unintended consequences run wild.  Wal-Mart was guilted into providing some health care coverage of part time workers because of tear-jerker news stories about these folks having no other alternative.  But under Obamacare, they do have an alternative (Uncle Sam) so the pressure on Wal-Mart to provide the care to avoid bad PR is removed.
• I am amazed that we seem to naturally assume that providing health care is an employer's obligation.  This is just bizarre, and applies to none of our other needs.  Employers pay us money, we spend it according to our preferences to fulfill our needs and caprices  (a great phrase I stole from Agatha Christie via Hercule Poirot).   “Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan".  I would have said that Wal-Mart is shifting the choice of how to spend their total compensation back on the employee.
• The cat is almost out of the bag on the story I have promised to be the biggest economic story of 2013:  "Several employers in recent months, including Darden Restaurants, owner of Olive Garden and Red Lobster, and a New York-area Applebee’s franchise owner, said they are considering cutting employee hours to push more workers below the 30-hour threshold."  These guys are just being coy in public if they are saying "considering."  I know insiders in the restaurant industry and they have been working on definite plans to part-time their entire work force for well over a year.   By mid-2013, the service worker who works more than 30 hours a week will be a dinosaur
• Some time in the past, we really screwed up the whole concept of health care "insurance."  One person complains in the article:  “The packages Walmart is providing for low-income people aren’t offering very much coverage except for catastrophes."  Gee, I could have sworn this is exactly what insurance is supposed to be.  Her statement is like saying "my home insurance isn't offering much coverage except in the case of major damage to my house."
• Every extra dollar Wal-Mart pays for its employee's health care costs is another dollar added to the shopping bill of the lower income people who shop there.

In Obamacare, it was mandated that health insurance companies spend 85% of premiums on care (vs. marketing, profits, and overhead) or else they owe their customers a refund.  So if the same standard was applied to unions, how much of their dues would they have to refund?

For example, according to the most recent federal filings, the Michigan Education Association — the state’s largest labor union — received $122 million and spent $134 million in 2012. They averaged about $800 from each of their 152,000 members.

According to union documents, "representational activities" (money spent on bargaining contracts for members) made up only 11 percent of total spending for the union. Meanwhile, spending on “general overhead” (union administration and employee benefits) comprised of 61 percent of the total spending.

The union appears to have spent nearly the entirety, or $119 million of their $122 million in dues, just supporting their leadership  (and various politicians) in grand style.  They actually had to borrow $12 million to do their job of representing their members.

By Obama's standard of good management (core activity costs = 85% of total customer dues paid) then the union should have taken only $17.4 million from their members, and owe them a $104.6 million refund.

Glenn Reynolds links to an article on oral histories.  In 8th grade, my son had to do an oral history of someone in my family.  I bought him an mp3 recorder, one of those little dictation things they sell at Staples or Office Depot, and he recorded about 4 hours of interviews.

My dad passed away last week, but due to dementia lost the ability to discuss his life long before that.  My dad had an amazing life, growing up in a tiny house in Depression-era Iowa and eventually running one of the largest corporations in the world.  He never talked about himself.  Knowing him, one couldn't imagine him writing a memoir.  In a day where executives hire PR agents to puff them up in the press, my dad scoffed and derided the practice.  He bought all his casual clothes at Sears until his teenage daughters made him stop.

So the only history we have of him in his own words wouldn't exist if a wonderful teacher hadn't assigned him the project.

I say that as if it was hard.  Actually, it was pretty dang easy to get the OS (a Linux variant) loaded on the memory card.  Seems to work fine -- you can see I have Coyote Blog up in the browser.  I am playing with it because I am looking for something to control signaling and other systems on a model railroad.  I am more likely to use some kind of Arduino setup, but I wanted to play around with Python on Raspberry Pi as well.

Here is the card.  The top wire is a micro-USB 5v power connector.  Clockwise from that is a 32GB SD card (for memory), a bunch of empty programmable pins for I/O on the upper right of the board, the composite video connector and audio headphone out, two USB ports with my wireless keyboard connector, the network cable, and on the left the HDMI cable for video out  (don't know yet if it has audio out over HDMI).  As in the Arduino community, there are already daughter boards for the pin-outs with breadboards, motor controllers, and other gizmos.

In my high school days, I used to play a lot of wargames from Avalon Hill and SPI.  I once spent an entire summer playing one game of War in Europe, which had a 42-square-foot map of Europe and 3500 or so pieces.     Each turn was one week, so it was literally a full time job getting through it in a couple of months.

All that is to say I spent a lot of time hanging out at game stores, particularly Nan's in Houston (a great game and comic store that still exists and I still visit every time I am in Houston).  I play fewer wargames now, but I still like strategy games that are a bit more complicated than Monopoly or Risk.  But it is hard to find a game store with a good selection (if there is one here in Phoenix, I have not found it).

But I definitely want to try this place -- the Complete Strategist in New York City.  Click through for some good game pr0n.

His list of games is good, though I have never played Gloom and I have never been a huge fan of Carcassonne.  Ticket to Ride is an awesome game and is perhaps the most accessible for kids and noobs of either his or my list.  If you recognize none of these games, it is a great place to start (there is also a great iPad app).   To his list of games I would add:

• 7 wonders  (our family's current favorite)
• Small world (our family's previous favorite, also look for the great iPad app)
• Dominion (my current personal favorite)
• Race for the Galaxy  (you can also download an online version to try, one of my favorite quick computer games)

All of these games tend to present simple choices with extraordinarily complex scoring implications.  In most cases, one must build infrastructure early to score later, but the trade-off of when to switch from infrastructure building to scoring is the trick.  Five years ago Settlers of Catan would have been on any such list, but it is interesting it is on neither his nor mine.

Once you catch the bug, there are hundreds of other games out there.  My son and I last summer got caught up in a very complex Game of Thrones expandable card game.  Recommended only for those who love incredible complexity and are familiar with the books.  There are also a couple of games I have liked but only played once so far.  My son and I last summer played a fabulous though stupidly complex game of Twilight Struggle (about the Cold War, not hot vampire teens).  This is considered by many to be one of the greatest war / strategy games ever.  We also tried Eclipse (space game, again not the teen vampires) which we liked.  I have played Le Havre and Puerto Rico as iPad apps.  They were OK,  but I think the fun in them is social and the of course does not come through in the iPad app.  In the same vein, tried to play Agricola with my kids and they were bored stiff.

Update:  When in doubt, research it on Board Game Geek.  Their game ranking by user voting is here.

As I understand it, the justifications for strong and detailed government oversight of commerce rests on two ideas:

• That government officials somehow have better incentives than private actors and are more likely to act in the interests of the general public
• That a few carefully selected smart people standing on top of the system managing top down can impose better structural solutions for markets than will emerge organically.

Readers will know in advance that I think both of these statements are total crap, but I don't need to explain the reasons yet again because Democrats in the House of Representatives just created the most clear refutation possible by making Maxine Waters the ranking Democrat on the House Financial Services committee (which has oversight for the most regulated industry in this country).

Ms. Waters fails both these tests.  She has a history of putting her own financial interests ahead of her oversight mission, and as far as the smart person standing at the top model, she has time and again demonstrated her complete lack of understanding of the very industry she regulates (well, either that or her entire career in Congress has actually been an elaborate bit of Dada-ist performance art).

My company has an email list folks can join to get emails if we have jobs available.  We have about 15,000 people on the list and get hundreds of applications whenever there is a new job, even though we probably have fewer than 20 openings a year.   I got this email today from someone I suppose must have added his name to the list:

Do you know that since I signed up with you, I have not recieved ONE e-mail from you about jobs ???  Are you holding out jobs for friends ? Do you just get people to sign up then forget them for fun ??  Or is it that you have no job leads ???
Why did I waste my time signing up with you ????????????

Certainly this man's willingness to turn the smallest frustration into an enormous imagined slight with hints of conspiracy is EXACTLY what we are looking for in our customer service staff.

In this country, at least in high school civics classes, we often equate freedom and democracy.  But this is not the case.  I have written before that protection of individual rights is far more critical to our well-being than voting.  If there was a system with a better track record for protecting individual rights than democracy, I would support it, even if it did not involve voting.

Here is an interesting example from Kuwait of a king protecting individual rights from a democratically-elected body

Although a monarchy, Kuwait has an elected parliament and a generally free media. It regularly invites foreign analysts and journalists to observe its elections. I am making my second trip this year.

Tremors from the Arab Spring are being felt here. The parliament elected in 2009 faced charges of corruption and lost popularity, and was dissolved at the beginning of the year. Elections were held in February.

All very democratic.

The new legislature was dominated by anti-government activists and, more important, Islamists. Top of the latter’s agenda was making Sharia the basis of all laws, imposing the death penalty for blasphemy, and closing Christian churches. Not very good for liberty.

The Kuwaiti emir, Sheikh Sabah al-Ahmad al-Sabah, said no to all three. Liberty was protected only because Kuwait was not a genuine parliamentary system where elections determine the government.

Please, do not over-interpret my point here.  I am well aware that the Emir in Kuwait holds a number of illiberal views with which I would disagree.  But its an interesting example none-the-less.

I am not sure I understand Kevin Drum's argument for capital controls.  He seems to be arguing that these controls are a sort of financial speed limit and making an awkward analogy to highway speed limits to justify them.

In a world where I as a taxpayer have to bail out banks, I don't have a huge problem with capital requirements for banks, though this seemingly simply topic is rife with unintended consequences -- I have seen it argued persuasively that the pre-2008 Basil capital requirements helped fuel the housing bubble by giving special preference to MBS in computing capital.  In fact, one might argue the same for the sovereign debt crisis, that by creating a huge demand for sovereign debt for bank balance sheets it fueled an unsustainable expansion in such debt.

Anyway, the point of this post was capital controls.  Drum quotes this from an IMF report:

19. Indeed, as the recent global financial crisis has shown, large and volatile capital flows can pose risks even for countries that have long been open and drawn benefits from capital flows and that have highly developed financial markets. For example, in several advanced economies, financial supervision and regulation failed to prevent unsustainable asset bubbles and booms in domestic demand from developing that were partly fueled by cheap external financing. Rather than favoring closed capital accounts, these experiences highlight the need for policymakers to remain vigilant to the risks. In particular, there is a constant need for sound prudential frameworks to manage the risks that capital inflows can give rise to, which may be exacerbated by financial innovation.

The logic, then, is that bubbles are exacerbated by inflows of foreign capital so capital controls can keep bubbles from getting worse.  I have very little knowledge of international finance, but let me test three thoughts I have on this:

1. Doesn't this cut both ways?  If bubbles can be inflated by capital inflows, can't they also be deflated by capital outflows?  Presumably, if people domestically see the bubble, they would logically look for other places to invest their money.  International investments outside of the overheated domestic market are a logical alternative, and such capital flows would act a s a safety valve to reduce pressure on the bubble.  So wouldn't capital controls just as likely make bubbles worse, by confining capital within the bubble, as make them better by preventing new capital from outside the country flowing in?
2. The implication here is that the controls would be dynamic.  In other words, some smart person in government would close the gates when a bubble starts to build and open them at other times.  But does that not presupposed the ability to see the bubble when one is in it?  Certainly there were a few who pointed out the housing bubble before 2008, but few in power did so.  And even if they had seen it, what is the likelihood that they would have pointed it out or taken action?  Who wants to be the politician who pops the bubble?  Remember the grief Greenspan got for pointing to an earlier bubble?
3. Controls on capital inflows tend to be anti-consumer.  Yeah, I know, no one in government ever seems to care when they pass protectionist laws that protect 100 tire workers at the cost of higher tires for 100 million drivers.  But limiting capital inflows would reduce the value of the dollar, and make anything imported (or made from imported parts or materials) more expensive.

I have already written that the supposed European austerity (e.g. in the UK) is no such thing, and "austerity" in these cases is being used to describe what is merely a slowing in spending growth.

Apparently the same Newspeak is being applied to spending cuts in the US.  How else  can one match this data:

With these words from President Obama (my emphasis added)

"If we're going to raise revenues that are sufficient to balance with the very tough cuts that we've already made and the further reforms in entitlements that I’m prepared to make, then we’re going to have to see the rates on the top two percent go up"

Seriously?  The only small reductions in the budget were because some supposedly one-time expenses (like TARP bailouts, war costs, and stimulus spending) were not repeated.  Allowing one-time costs to be, uh, one-time does not constitute "tough cuts."

Tough cuts are when we knock government spending back down to 19-20 percent of GDP.  Clinton level spending in exchange for Clinton tax rates.   That's my proposed deal.

Google has a pilot to offer TV and high-speed Internet service in Kansas City.  Adding phone service would have cost them practically nothing, and presumably would have provided great value to its customers.  But it gave up because even for a company as large as Google, the regulatory start-up burdens were too large.  Many innovative new industries or new approaches to old industries have been started literally in someone's garage.  But no one with a better idea for local telephone service is ever going to make progress against these kinds of regulatory barriers.  Which is exactly what the large incumbents want, and why they secretly support these massive regulatory infrastructures (while publicly whining about them).

Kevin Drum posts this chart with a straight face as "proof" that sea level rise is out-pacing forecasts.

I don't really think I need to even point out the problem to most of my readers, but you can see the differences in ending value is because the starting values are different.  Likely the two are drawing from different data sources with a shifted zero value.  The slopes are the same, confirmed by the fact that the 3.2 mm trend per year is well within the IPCC forecast range that was centered, if I remember right, around 3.3 mm per year.  It is also well under Al Gore's forecast, which was for 20 feet by 2100, or about 61 mm per year.

Almost exactly seven years ago (amazing how long I have been blogging) I wrote an extended piece about how hard it is to change corporate DNA.  I was writing about GM but also used Wal-Mart as an example.  Part of this piece read:

A corporation has physical plant (like factories) and workers of various skill levels who have productive potential.  These physical and human assets are overlaid with what we generally shortcut as "management" but which includes not just the actual humans currently managing the company but the organization approach, the culture, the management processes, its systems, the traditions, its contracts, its unions, the intellectual property, etc. etc.  In fact, by calling all this summed together "management", we falsely create the impression that it can easily be changed out, by firing the overpaid bums and getting new smarter guys.  This is not the case - Just ask Ross Perot.  You could fire the top 20 guys at GM and replace them all with the consensus all-brilliant team and I still am not sure they could fix it.

All these management factors, from the managers themselves to process to history to culture could better be called the corporate DNA*.  And DNA is very hard to change.  Walmart may be freaking brilliant at what they do, but demand that they change tomorrow to an upscale retailer marketing fashion products to teenage girls, and I don't think they would ever get there.  Its just too much change in the DNA.  Yeah, you could hire some ex Merry-go-round** executives, but you still have a culture aimed at big box low prices, a logistics system and infrastructure aimed at doing same, absolutely no history or knowledge of fashion, etc. etc.  I would bet you any amount of money I could get to the GAP faster starting from scratch than starting from Walmart.  For example, many folks (like me) greatly prefer Target over Walmart because Target is a slightly nicer, more relaxing place to shop.  And even this small difference may ultimately confound Walmart.  Even this very incremental need to add some aesthetics to their experience may overtax their DNA.

Corporate DNA acts as a value multiplier.  The best corporate DNA has a multiplier greater than one, meaning that it increases the value of the people and physical assets in the corporation.  When I was at a company called Emerson Electric (an industrial conglomerate, not the consumer electronics guys) they were famous in the business world for having a corporate DNA that added value to certain types of industrial companies through cost reduction and intelligent investment.  Emerson's management, though, was always aware of the limits of their DNA, and paid careful attention to where their DNA would have a multiplier effect and where it would not.  Every company that has ever grown rapidly has had a DNA that provided a multiplier greater than one... for a while.

But things change.  Sometimes that change is slow, like a creeping climate change, or sometimes it is rapid, like the dinosaur-killing comet.  DNA that was robust no longer matches what the market needs, or some other entity with better DNA comes along and out-competes you.  When this happens, when a corporation becomes senescent, when its DNA is out of date, then its multiplier slips below one.  The corporation is killing the value of its assets.  Smart people are made stupid by a bad organization and systems and culture.  In the case of GM, hordes of brilliant engineers teamed with highly-skilled production workers and modern robotic manufacturing plants are turning out cars no one wants, at prices no one wants to pay.

Changing your DNA is tough.  It is sometimes possible, with the right managers and a crisis mentality, to evolve DNA over a period of 20-30 years.  One could argue that GE did this, avoiding becoming an old-industry dinosaur.  GM has had a 30 year window (dating from the mid-seventies oil price rise and influx of imported cars) to make a change, and it has not been enough.  GM's DNA was programmed to make big, ugly (IMO) cars, and that is what it has continued to do.  If its leaders were not able or willing to change its DNA over the last 30 years, no one, no matter how brilliant, is going to do it in the next 2-3.

Megan McArdle makes some very similar points as I about Wal-Mart and how hard it is to change corporate DNA.  I recommend you read the whole thing.

A number of years ago, there was a push by many Leftish technocrats for the government to mandate a standardized cell phone power cord.  Beyond demonstrating that there is no personal irritation too trivial for some to demand government action, this would have been an awful idea.  Why?  Because when these demands for action came, cell phone power cords were just that, power.  If a standard cord had been mandated, then current designs that use a USB connection for both data and power would have been illegal, at least without the vendor also putting in a connection for the government standard connector as well.  There is always danger to the government setting arbitrary standards, but these dangers are an order of magnitude higher when the technology is still in flux.

So enter light bulbs.  The government has decided to ban incandescent light bulbs and while not mandating them, it has actively encouraged people to purchase expensive CFL bulbs.  The only problem is that CFL bulbs suck.  The light from them has bad color qualities, many take a long time to warm up, they are hard to dim, and they contain toxic substances.  They also have nothing like the multi-year life we are promised.  I have tried CFL bulbs of many, many brands and none have consistently achieved their promised life.

But as much as I hate CFL's, I am coming to love LED-based lights.  LED lights use even less energy than CFL's and last a really long time.  The technology allows for color tweaking better than CFL's, and already the warm white LED's I am buying (color temperatures around 2900K) are better to my eye than CFL's, and there is no fast-flicker problem that gives some people headaches.  Dimable versions are coming out, and prices are dropping but they are still expensive.   About half my house is LED now, and I am told that landscape lighting is quickly going all LED.

The main cost to LED's is that they all have to have a transformer.  LED's run at low voltages, like 5v, so house current has to be stepped down at every bulb.  LED's in theory should run cool and be cheap, but they are expensive and run hot because of the transformers.

Which leads me to wonder whether we may start wiring houses for 12v in parallel to 110v.  When I grew up, nearly everything I plugged into the wall -- lights, motors, appliances -- ran on 110V.  Now, most everything (other than appliances) that I plug in the wall actually needs 5-12v  (computers, cell phones, all my audio equipment except big amps).  I don't know enough about power lines to know if this is feasible.  I am pretty sure the resistance losses for 12V DC would be too high, so it would have to be 12V AC, but a diode bridge and some capacitors is a hell of a lot smaller and cheaper than a full blown transformer.  I know my landscape lighting has long runs of 12V, that seems to work OK.  It is also a hell of a lot safer to work with.

I can't call myself a defender of Israel per se because they have done a number of illiberal things in their country that tick me off.  However, I can say that for all the problems they may have, their response to a neighboring country dropping rockets on its citizens is FAR more restrained than would be the response of, say, the US.  If Mexico were dropping rockets into El Paso, Mexico would be a smoking hole in the ground.   We still maintain a stricter economic embargo on Cuba, which has never done a thing to us, than Israel does on Gaza.

I pay attention to the Amherst College community since my son enrolled there.  I thought this was a pretty powerful article by an Amherst student who has taken a leave of absence to join the IDF.  Given my understanding of how Eastern liberal arts faculty think about Israel and Palestine, one should think of this as a voice in the wilderness.

Sorry, but it is not the fiscal cliff.   It is the complete shift in the US labor model, at least in the service sector, due to Obamacare.

Here is what I am doing for the rest of the year -- working with every manager in my company so that as of January 1, 2013, none of our employees are working more than 28 hours a week.   I think most readers know the reason -- we have got to get our company under 50 full time employees or else I am facing a bill from Obamacare in 2014 that will be several times larger than my annual profit.  I love my workers.  They make me a success.  But most of my competitors are small businesses that are exempt from the Obamacare hammer.  To compete, I must make sure my company is exempt as well.  This means that our 400+ full time employees will have to be less than 50 in 2013, so that when the Feds look at me at the start of 2014, I am exempt.  We will have more employees working fewer hours, with more training costs, but the Obamacare bill looks like about $800,000 a year for us, at least, and I am pretty sure the cost of more training will be less than that.

This will be unpopular but tolerable to most of my employees.  The vast majority of them are retired and our company is merely an excuse to stay busy, work outdoors, and get a little extra money.

But this is going to be an ENORMOUS change in the rest of the service sector.  I have talked to a lot of owners of restaurants and restaurant chains, and the 40-hour work week is a thing of the past in that business.  One of my employees said that in Hawaii, it was all the hotel employees could talk about.   Many chains are working on mutli-team systems where two teams of people working part-time replace the former group of full-time employees.  2013 is going to see a lot of people (who are not paid very well to begin with) getting their hours and pay cut by 25%.  At the same time that they are required, likely for the first time since many are relatively young, to purchase health insurance.

It will be interesting to see what solutions emerge.  My bet is that it will become standard for people in the service sector to work two different jobs for 20-25 hours each with two different companies.  This will be a pain for them, but allow them to keep their income up.  The hard part may be coordinating shifts between companies.  For example, a company that divides their shifts into mon-tue-wed vs. thu-fri-sat cannot share employees with one who divides their shifts between morning and afternoon.  If given time, I would guess that just as the mon-fri workweek emerged as a standard, companies may adopt standard ways of dividing up the work weeks for part-timers, making it easier for schedules to mesh.

From Walter Olson

According to the New York Times, French Socialist president François Hollande demanded and received the dismissal of the editor of Le Figaro, the country’s leading conservative newspaper. If that sounds impossibly high-handed, consider the background, as reported in the Times:

The publisher, Serge Dassault, is a senator from [ousted President Nicolas] Sarkozy’s political party [and thus opposed to Hollande]. But Mr. Dassault also heads a major military contractor, and there was widespread speculation that [Figaro editor Étienne] Mougeotte’s ouster was meant to put the Dassault group in good stead with the new president.

For an American reader, it would be natural to turn the page with a murmur of thanks that such things don’t go on in our country. Don’tbe so sure:

[Since-convicted Illinois Gov. Rod] Blagojevich, Harris and others are also alleged [in the federal indictment] to have withheld state assistance to the Tribune Company in connection with the sale of Wrigley Field. The statement says this was done to induce the firing of Chicago Tribune editorial board members who were critical of Blagojevich.

Read the whole thing.  He has an interesting story about Ted Kennedy passing legislation to force a change in ownership of the Boston paper most consistently critical of him.

Presented without comment (source).

The source is an agency in PA so I don't know if this is a state phenomenon there or if this is US data