Jts5665

Reason’s Nick Gillespie in a December 2013 Time.com article “Football: A Waste of Taxpayers’ Money” asks a very good question: Why are we subsidizing such a hugely profitable sport?

It’s just not right when governments shovel tax dollars at favored companies or special interests, even when those firms are called, say, the Minnesota Vikings or the Scarlet Knights of Rutgers University. The NFL’s Vikings are lousy at scoring touchdowns – they have the worst record in the NFC North – but they’ve proven remarkably adept in shaking down Minnesotans for free money. Next year they’ll be playing ball in a brand-spanking new $975 million complex in downtown Minneapolis, more than half of whose cost is being picked up by state and local taxpayers. Over the 30-year life of the project, the public share of costs will come to $678 million. The team will pay about $13 million a year to use the stadium, but since it gets virtually all revenue from parking, food, luxury boxes, naming rights, and more, it should be able to cover that tab.

Not that the Vikings were ever hard up for money: Forbes values the franchise at nearly $800 million and the team’s principal owner, Zygi Wilf, is worth a cool $310 million. When the Minnesota legislature signed off on its stadium deal for the Vikings, the state was facing a $1.1 billion budget deficit. Priorities, priorities. And the Vikings deal isn’t the exception, it’s the rule.

Here’s the abstract of the research paper “The (True) Legacy of Two Really Existing Economic Systems“:

By running an experiment among Germans collecting their passports or ID cards in the citizen centers of Berlin, we find that individuals with an East German family background cheat significantly more on an abstract task than those with a West German family background. The longer individuals were exposed to socialism, the more likely they were to cheat on our task. While it was recently argued that markets decay morals (Falk and Szech, 2013), we provide evidence that other political and economic regimes such as socialism might have an even more detrimental effect on individuals’ behavior.

And here’s part of the conclusion:

If socialism indeed promotes individual dishonesty, the specific features of this socio-political system that lead to this outcome remain to be determined. The East German socialist regime differed from the West German capitalist regime in several important ways. First, the system did not reward work based to merit, and made it difficult to accumulate wealth or pass anything on to one’s family. This may have resulted in a lack of meaning leading to demoralization (Ariely et al., 2008), and perhaps less concern for upholding standards of honesty. Furthermore, while the government claimed to exist in service of the people, it failed to provide functional public systems or economic security. Observing this moral hypocrisy in government may have eroded the value citizens placed on honesty. Finally, and perhaps most straightforwardly, the political and economic system pressured people to work around official laws and cheat to game the system. Over time, individuals may come to normalize these types of behaviors. Given these distinct possible influences, further research will be needed to understand which aspects of socialism have the strongest or most lasting impacts on morality.

Here’s a link to an article in The Economist about the paper “Lying Commies: The more people are exposed to socialism, the worse they behave.”

Related: My 1995 article “Why Socialism Failed.”

Stephanie Rugolo

As 2016 presidential contender Rand Paul catches flack for his so-called foreign policy “isolationism,” the neocons go on frightening the public. According to the hawks, the world is getting more dangerous.

In a Politico interview last Monday, Dick Cheney said, “The world’s not getting safer, it’s getting far more dangerous.” On the same day, Newt Gingrich said on CNN:

After 9/11, the United States is not safer … in an increasingly dangerous world… If you look at what’s happening around the world today, it’s almost impossible to say that we’re safer… The worldwide scene is not a very safe scene.”

Senator John McCain also said on CNN that the world is “in greater turmoil than at any time in my lifetime.”

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Every so often, David Brooks can be insightful. This sports analogy may help put things in perspective for people who often find themselves frustrated that life does not go the way they expect it to:

Most of us spend our days thinking we are playing baseball, but we are really playing soccer. We think we individually choose what career path to take, whom to socialize with, what views to hold. But, in fact, those decisions are shaped by the networks of people around us more than we dare recognize....

Once we acknowledge that, in life, we are playing soccer, not baseball, a few things become clear. First, awareness of the landscape of reality is the highest form of wisdom. It’s not raw computational power that matters most; it’s having a sensitive attunement to the widest environment, feeling where the flow of events is going. Genius is in practice perceiving more than the conscious reasoning.

Second, predictive models will be less useful. Baseball is wonderful for sabermetricians. In each at bat there is a limited range of possible outcomes. Activities like soccer are not as easily renderable statistically, because the relevant spatial structures are harder to quantify.

Everyone knows connections and networks and friends and family are more important to success than raw ability and hard work. And yet, that recognition offends most of us. It seems unfair somehow. But why? We see examples in every aspect of human endeavor. Even Michael Jordan didn't become a champion by scoring 63 points a game, he achieved more when he scored 30 and relied on Scottie Pippen and his other teammates to help him win the game.

The coach of my Nike team once asked me how it was that I scored a goal in every game that season, regardless of whether the team we played against was good or bad, whereas my more talented strike partner would tend to score three goals against the bad teams and get regularly shut out by the good ones. I pointed out that the other striker's goals were almost always brilliant individual efforts that involved beating two or three defenders on the dribble. Mine were almost always one- or two-touch shots that relied upon getting a well-placed pass from a midfielder, often my younger brother.

And while the other striker was a gifted player from Ireland who could dribble right past two or three lesser defenders, he wasn't gifted enough to beat two or three good ones in succession. For me, on the other hand, it made little difference if the defenders were good or bad, because as long as the midfielder passed the ball into the open space past the last defender, I was going to run right past them. When the defense was tough, a little teamwork reliably trumped considerably superior individual talent.

The lesson of soccer is that individual effort will often suffice when things are relatively easy. But in order to surmount the more difficult challenges, you will almost always need reliable teammates of one sort or another.

Simon Lester

It doesn’t happen often, so I like to highlight it when it does.  Here is Australian trade minister Andrew Robb:

We’ve seen over the last thirty years in Australia that tariffs are down on average 2.7 per cent across the economy.  A lot of that was done unilaterally – we didn’t wait for the rest of the world and it’s one of the reasons that we’ve had uninterrupted growth for 23 years, because we are a very open economy. We’ve got to drive it further, we’ve got to be more competitive but so does the rest of the world.

SUIT: Woman Arrested, Detained For 24 Hours For Recording Police Activity...


(Third column, 8th story, link)

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Perhaps the only thing more surprising that someone actually needed a poll to "discover" how the world feels regarding the NSA constant snooping of every form of electronic communication, is that a majority of the respondents in India, Nigeria and the Phillippines actually approve of having zero privacy. Oh, and the United States too.

As for the 10% of Russians who said "approve", we assume they were either seriously drunk or even more seriously hung over when responding to the poll.

Source: Pew

We've noted for years that the Pentagon and spy agencies manipulate the Internet - including social media - in order to promote false propaganda and to stifle dissenting information.

We've also discussed some of the methods used to game popularity on social media sites.

A new report from the Intercept adds to our understanding of these tactics:

The secretive British spy agency GCHQ has developed covert tools to seed the internet with false information, including the ability to manipulate the results of online polls, artificially inflate pageview counts on web sites, “amplif[y]” sanctioned messages on YouTube, and censor video content judged to be “extremist.” The capabilities, detailed in documents provided by NSA whistleblower Edward Snowden, even include an old standby for pre-adolescent prank callers everywhere: A way to connect two unsuspecting phone users together in a call.

 

The tools were created by GCHQ’s Joint Threat Research Intelligence Group (JTRIG), and constitute some of the most startling methods of propaganda and internet deception contained within the Snowden archive. Previously disclosed documents have detailed JTRIG’s use of “fake victim blog posts,” “false flag operations,” “honey traps” and psychological manipulation to target online activists, monitor visitors to WikiLeaks, and spy on YouTube and Facebook users.

 

***

 

The “tools” have been assigned boastful code names. They include invasive methods for online surveillance, as well as some of the very techniques that the U.S. and U.K. have harshly prosecuted young online activists for employing, including “distributed denial of service” attacks and “call bombing.” But they also describe previously unknown tactics for manipulating and distorting online political discourse and disseminating state propaganda, as well as the apparent ability to actively monitor Skype users in real-time—raising further questions about the extent of Microsoft’s cooperation with spy agencies or potential vulnerabilities in its Skype’s encryption. Here’s a list of how JTRIG describes its capabilities:

 

• “Change outcome of online polls” (UNDERPASS)

 

• “Mass delivery of email messaging to support an Information Operations campaign” (BADGER) and “mass delivery of SMS messages to support an Information Operations campaign” (WARPARTH)

 

• “Disruption of video-based websites hosting extremist content through concerted target discovery and content removal.” (SILVERLORD)

 

• “Active skype capability. Provision of real time call records (SkypeOut and SkypetoSkype) and bidirectional instant messaging. Also contact lists.” (MINIATURE HERO)

 

• “Find private photographs of targets on Facebook” (SPRING BISHOP)

 

• “A tool that will permanently disable a target’s account on their computer” (ANGRY PIRATE)

 

• “Ability to artificially increase traffic to a website” (GATEWAY) and “ability to inflate page views on websites” (SLIPSTREAM)

 

• “Amplification of a given message, normally video, on popular multimedia websites (Youtube)” (GESTATOR)

 

• “Targeted Denial Of Service against Web Servers” (PREDATORS FACE) and “Distributed denial of service using P2P. Built by ICTR, deployed by JTRIG” (ROLLING THUNDER)

 

• “A suite of tools for monitoring target use of the UK auction site eBay (www.ebay.co.uk)” (ELATE)

 

• “Ability to spoof any email address and send email under that identity” (CHANGELING)

 

• “For connecting two target phone together in a call” (IMPERIAL BARGE)

NSA engages in the same types of dirty tricks.

We're not very confident that the spies are only going after actual bad guys and promoting the messages of the good guys, given that:

• Any criticism of government policies is considered "extremist" and potential terrorism

• Top NSA whistleblowers Bill Binney and Thomas Drake both say that the U.S. has become a police state

• They say that the U.S. government has become like the Stasis or Soviets,  and Binney says that the NSA has become like “J. Edgar Hoover on super steroids”

• Mass surveillance isalways used to crush dissent

And see this.

(Don Boudreaux)

… is from page 31 of H.L. Mencken’s, A Second Mencken Chrestomathy (1995); specifically, it’s reprinted from Mencken’s 1926 book, Notes on Democracy:

He is a man who has lied and dissembled, and a man who has crawled.  He knows the taste of the boot-polish.  He has suffered kicks in the tonneau of his pantaloons.  He has taken orders from his superiors in knavery and he has wooed and flattered his inferiors in sense.  His public life is an endless series of evasions and false pretenses.  He is willing to embrace any issue, however idiotic, that will get him votes, and he is willing to sacrifice any principle, however sound, that will lose them for him.  I do not describe the democratic politician at his inordinate worst; I describe him as he is encountered in the full sunshine of normalcy.  He may be, on the one hand, a cross-roads idler striving to get into the State Legislature by grace of the local mortgage-sharks and evangelical clergy, or he may be, on the other hand, the President of the United States.  It is almost an axiom that no man may make a career in politics in the Republic without stooping to such ignobility.

The Brewers Association reported yesterday that:

The American brewing industry reached another milestone at the end of June, with more than 3,000 breweries operating for all or part of the month (3,040 to be precise). Although precise numbers from the 19th century are difficult to confirm, this is likely the first time the United States has crossed the 3,000 brewery barrier since the 1870s. The Internal Revenue Department counted 2,830 “ale and lager breweries in operation” in 1880, down from a high point of 4,131 in 1873.

What does 3,000 breweries mean? For one, it represents a return to the localization of beer production, with almost 99% of the 3,040 breweries being small and independent. The majority of Americans live within 10 miles of a local brewery, and with almost 2,000 planning breweries in the BA database, that percentage is only going to climb in the coming years.

Secondly, it means that competition continues to increase, and that brewers will need to further differentiate and focus on quality if they are going to succeed in a crowded marketplace. While a national brewery number is fairly irrelevant without understanding local marketplaces, 3,040 breweries could not happen without increased competition in many localities.

MP: In addition to the animated graphic above, there’s an interactive chart of the annual brewery count from 1873 to 2014 here. Note that in every year from 1977 to 1984 there were fewer than 100 breweries in the US, and the low point was 1978, when there were only 89 breweries. By 2007, there were about 1,500 breweries, and that number had doubled to more than 3,000 in less than 7 years! There’s never been a better time to be a serious beer drinker than today, given the awesome selection of craft beers from every part of the country. Welcome to the Golden Age of Beer - there’s no stagnation for this part of the economy!

I was watching some excellent videos of recent Phoenix dust storms roll across the city.  I started thinking about a joke story:

Scientists report that the number of Phoenix dust storms have likely increased substantially since 1990.  Before that date, almost no cell phone videos exist of large dust storms in Phoenix.  Today, one can find hundreds of such videos on Youtube, mostly from the last three or four years.  Obviously we are seeing some sort of climate change

This would clearly be absurd -- there has been a change in measurement technology.  No cell phone cameras existed before 1990.  But equally absurd examples can be found every day.

• With the summer of the shark, an increase in frequency of media coverage of shark attacks was mistaken for an increase in frequency of shark attacks themselves.
• With tornadoes, improving detection of smaller twisters (e.g. by doppler radar and storm chasers)  has been mistaken by many (cough Al Gore cough) for an increase in the frequency of tornadoes.  In fact, all evidence points to declining tornado frequency
• With electrical grid disturbances, a trend was created solely by the government owner of the data making a push with power companies to provide more complete reporting.
• I have wondered whether the so-called cancer epidemic in India is real, or the results of better diagnosis and longer life spans

Postscript:  I remember when I first saw one of these storms rolling towards me after I moved to Phoenix.  Perhaps I should not have read Stephen King's The Mist, but I honestly wondered for a minute if I would live to regret not hopping in my car and racing to stay ahead of the wall coming towards me.

 

"Trend that is not a trend" is an occasional feature on this blog.  I could probably write three stories a day on this topic if I wished.  The media is filled with stories of supposed trends based on single data points or anecdotes rather than, you know, actual trend data.  More stories of this type are here.  It is not unusual to find that the trend data often support a trend in the opposite direction as claimed by media articles.

(Don Boudreaux)

… is from page 74 of Richard Stroup’s concise, important, and clear 2003 book, Eco-nomics: What Everyone Should Know About Economics and the Environment (footnote excluded; links added):

Recent studies show that in countries where property rights are better protected, people are healthier and live longer due to better environmental conditions.  For example, using the economic freedom index discussed earlier, Seth Norton found that in countries where property rights are protected, 93 percent of the population have access to safe drinking water, while in nations with weak property rights, only 60 percent of the population have that access.  Similarly, in nations with stronger property rights, 93 percent have access to sewage treatment, while only 48 percent do in countries with weak rights.  Life expectancy is 70 years in a nation with strong protection of property rights, while it is only 50 years in nations without that level of protection.

The article by Seth Norton referred to in Rick’s quotation is “Property Rights, the Environment, and Economic Well-Being,” which is a chapter in the important 1998 collection, Who Owns the Environment? (Peter J. Hill and Roger E. Meiners, eds.).

Tim Lynch

Over at Cato’s Police Misconduct web site, we have identified the worst case for the month of June.  Police officer Ronald Harris tried to rob a woman at the Memphis International Airport.  This was an extraordinary theft.  Harris was trying to steal a bag from an employee of St. Jude Children’s Hospital who was, in turn, delivering the bag to a family. The bag was a gift from the Make-A-Wish Foundation—the organization that grants wishes to terminally ill children.  The bag held several St. Jude t-shirts and a $1500 credit card for the family to use for travel.  Harris followed the St. Jude employee into the airport and then struck a member of the family who tried to stop him from stealing their wish away.  Harris has been suspended pending an investigation and faces a long list of charges. Police misconduct is never good, but plotting to steal the wish from a terminally ill child and their family is just really low.

Full story here.

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Anyone who thinks that Washington waste is something new should examine the history of the Bureau of Indian Affairs (BIA). This essay discusses the mismanagement, corruption, and failures of the BIA since it was created in 1824.

As early as 1828, Indian expert H. R. Schoolcraft concluded: “The derangements in the fiscal affairs of the Indian department are in the extreme. One would think that appropriations had been handled with a pitchfork … there is a screw loose in the public machinery somewhere.”

By the 1860s and 1870s, New York Times editorials were railing against the “dishonesty which pervades the whole Bureau,” and arguing that “the condition of the Indian service is simply shameful.”

In their recent book, Uncle Sam Can’t Count, Burton and Anita Folsom describe the failure of a major Indian policy even before 1824. Here is the basic story:

• Unhappy that British fur traders were out-competing American traders, Congress appropriated $50,000 in 1795 to create frontier posts stocked with American goods to trade with the Indians for furs.

• These government-run fur “factories” were supposed to earn a return, but they “were so poorly run that many Indians held them in contempt and refused to trade there.” Congress had to heavily subsidize the system to keep it operating.

• Rather than respond to the market demands of the Indians, as private traders did, the official running the government system, Thomas McKenney, tried to push products on the Indians that he thought they ought to have.

• The government set up its trading posts at substantial distances from Indians. By contrast, private fur trader John Jacob Astor had his agents build close relationships with Indians, and he made trading easy for the tribes.

• Astor instituted pay for performance, while the government paid its fur bureaucrats fixed salaries.

• Astor watched international fur markets closely and adjusted his operations and marketing accordingly. The government ignored markets, and simply dumped furs in Washington for auction.

• Thomas McKenney was embarrassed by the government’s falling market share and the huge success of Astor. So, in 1818, McKenney began lobbying Congress to ban private fur traders. When that attempt at monopolization failed, McKenney lobbied to impose large fees on private traders and to boost taxpayer subsidies for the government system.

• Despite a new fee on private traders in 1820, the government system was falling apart because of plunging sales. An official report exposed the huge inefficiencies of the government system, and Congress finally voted to end it in 1822.

Long before Solyndra and the Export-Import Bank, politicians should have learned some basic lessons about why Washington ought to stay out of business. Unfortunately, each new generation of politicians are tempted to believe that enlightened federal planners can run the economy better than businesspeople and markets. Rather than wasting hundreds of thousands of dollars as it did two centuries ago, Congress blows billions of dollars today on new versions of its fur-trading folly.

(Don Boudreaux)

… if from pages 128-129 of Virginia Postrel’s insightful and still-vital 1998 book, The Future and Its Enemies (bracketed remark and link added by me; footnote excluded):

The railroads, writes historian Edward Ayers, “neither wanted to police Southern race relations and then be sued for it nor to run extra cars [to segregate black passengers from white passengers].  It was clear that white Southerners could not count on the railroads to take matters in hand” by blocking or expelling black passengers from their first-class cars.  ”Some whites came to blame the railroads for the problem, says Ayers, “for it seemed to them that the corporations as usual were putting profits ahead of the welfare of the region.”  The critics were mostly right.  The railroads were not civil-rights pioneers but contract-bound, profit-seeking businesses for whom commerce was a “universal solvent.”  Outraged southern legislators, who already resented the railroads’ economic power, passed laws requiring segregated accommodations.  (It was one of these laws, passed by Louisiana in 1892, that the U.S. Supreme Court upheld in the famous “separate but equal” case, Plessy v. Ferguson.)  Combining the technocratic lust to regulate business with the reactionary zeal to preserve social stability, Jim Crow laws imposed static definitions on a dynamic commercial culture inclined to treat customers as “colorless, odorless, and timeless.”

Robert Higgs’s remarkable 1976 volume, Competition and Coercion: Blacks in the American Economy, 1865-1914, has more on the economics and history of the Jim Crow south.  See also Jennifer Roback, “Southern Labor Law in the Jim Crow Era: Exploitative or Competitive?, “University of Chicago Law Review, Vol. 51 (1984); and Jennifer Roback, “The Political Economy of Segregation: The Case of Segregated Streetcars,” 46 Journal of Economic History, Vol. 46 (1986).

"Laws are for other people."
- Too many legislators to count

It's common knowledge that insider trading is illegal. In fact, we have an entire government agency in place to regulate trading and to investigate insider trading allegations. Executives have been sentenced to months (sometimes even years) in plush, well-appointed hellholes for participating in insider trading.

Members of Congress, however, were exempt from insider trading rules until 2012. An 2011 expose by 60 Minutes let millions of Americans know that members of Congress had plenty of access to market-changing information and were acting on it.

In a rare (ha!) show of self-preservation, a united House full of Congresspersons facing reelection battles passed the STOCK Act, which basically made Congress and its staffers play by the same trading rules as every other American.

In 2013, with Congressional members safely re-elected, the House decided to roll back its previous legislative effort in order to get back into the insider trading business. It tore out the stipulation demanding disclosure of trading activity -- the one thing citizens could use to verify adherence to the "no insider trading" rule -- stating that these disclosures were a "security risk." This sailed through with unanimous consent late on a Thursday afternoon (the end of the Congressional work week) and was signed by the President the following Monday.

Now, Congress is again claiming it doesn't need to submit to laws that govern US citizens and, again, it's doing this to avoid any transparency or accountability being applied to its trading activities.

The U.S. House Ways and Means Committee and a top staff member say the panel and its employees are "absolutely immune" from having to comply with subpoenas from a federal regulator in an insider-trading probe.

The committee yesterday responded to U.S. District Court Judge Paul Gardephe's order to explain why it hadn't complied with the U.S. Securities and Exchange Commission's requests for documents, phone records and testimony of aide Brian Sutter for more than a year.

The SEC is investigating a suspicious spike in health insurer trading volumes and prices ahead of a report that announced government payments to insurers would be increased, rather than decreased. This investigation claims that a Green Taureg LLC lobbyist sent the information to a Height Securities LLC analyst ahead of the official government announcement and that House Ways and Means staff director Brian Sutter may have been the originating source.

The Committee's legal rep has responded by claiming Congress is above the law or, if not above, very definitely adjacent to it, but certainly not within in and subject to federal subpoenas.

Kerry W. Kircher, the top lawyer for the House, said the SEC's request should be dismissed because the information it seeks concerns legislative activities protected by the Constitution, which can't be reviewed by federal judges.

Kircher also stated that his client does not and will not (EVER) have time for the SEC's "apply the insider trading rules to everyone" bullshit.

Sutter's connection to the investigation is "tangential" Kircher said, and would also interfere with his work because his schedule is "heavily, and nearly permanently, booked."

So, if anyone thought an SEC insider trading probe would bring more accountability to the House, those thoughts may now be dismissed to make room for more cynicism. There's a slim possibility the SEC may extract damning evidence, but it will have to fight its way through a House full of people with no conceivable reason to be compliant. Insider trading was a great Congressional job perk and its uncontested run helped pad the wallets of future lobbyists, board members and consultants. No one really wants to completely end it, but they'd certainly like people to stop talking about it.

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Last week, we had a post from author Barry Eisler, responding to a bunch of other authors who were attacking Amazon over its current contract dispute with Hachette. As Eisler noted, nearly all of their complaints were either misleading or didn't make sense. There's no doubt that there's a contract dispute going on, but claims of "boycotts" and other attacks seem really directed to people misunderstanding what's going on in the dispute -- and thus, those authors are defending the traditional gatekeeper publishing model in which Hachette gets to keep nearly all of the proceeds of book sales. Of course, the authors' main "complaint" was that they felt like they were being used as pawns in the fight, and that the dispute might impact their sales directly.

To show how bogus that claim is, Amazon today went directly to Hachette authors with a proposal Amazon claims Hachette rejected: offering to give authors 100% of the proceeds on ebook sales.

The letter extends and develops a proposal Amazon made earlier in the dispute, which was dismissed by Hachette. It now offers Hachette authors “100 percent of the sales price of every Hachette e-book we sell.” Amazon also offered to suspend all its shipping delays and price adjustments, which it put in place in an effort to bend Hachette to its will.

Of course, defenders of the publishers insist that this is all a ploy for Amazon in its never-ending mission to take over the world:

Roxana Robinson, president of the Authors Guild, dismissed the proposal.

“If Amazon wants to have a constructive conversation about this, we’re ready to have one at any time,” she said in an email. “But this seems like a short-term solution that encourages authors to take sides against their publishers. It doesn’t get authors out of the middle of this �“ we’re still in the middle. Our books are at the center of this struggle.”

Once again, it's confusing to figure out which side the Authors Guild is really on here. Since we started covering that organization, it appears that it sides 100% with the publishers and rarely sides with what matters for the vast majority of authors.

The whole situation is quite bizarre when you think about it. At the same time you have Hachette and the Authors Guild insisting that they're trying to "protect the book" by keeping book prices artificially high, they're loudly complaining that Amazon won't discount their books. Notice some hypocrisy here? If you want to understand why this is happening, the best explanation I've seen so far comes from Hugh Howey, one of the super successful self-published authors who is firmly in Amazon's camp on this fight. Writing in the Guardian, he notes the perverse incentives of the traditional publishing world on Amazon:

Under the previous wholesale model, publishers might price an ebook at $14.99, and with the 50% discount, an online retailer like Amazon was able to discount to a more reasonable $9.99 to serve customers. Customers who expect digital books to cost less than the paperbacks with which they were familiar. With the new discount rate, Amazon stood to lose money by offering that same price. Publishers, meanwhile, were less than enthusiastic about lowering the offered wholesale discount.

Publishers like Hachette now found themselves in enviable territory. They could price ebooks high �“ protecting their relationship with high-street booksellers �“ and rely on Amazon to cut their own margin to the bone in order to move quantities of ebooks. This new situation created the bizarre scenario where authors who once complained about Amazon's discounting are now complaining that they aren't discounting enough. And during these negotiations, parties from Hachette's side are accusing Amazon of raising prices by offering something close to what the publisher itself is setting.

In a presentation to investors, Hachette has stated as a primary goal the control of ebook pricing. Breaking their habitual silence just last week, a representative from Amazon confirmed that the sticking point in these negotiations is indeed price. So both sides have confirmed what's at stake. History would indicate that Amazon thinks ebooks should cost no more than $9.99. Their agreement with self-published authors supports this, as the royalty rate paid halves if the price exceeds this amount. Hachette, meanwhile, would very much prefer to offer ebooks at $14.99 or more and leave any discounting up to Amazon (or any pain up to their customers).

In other words, everyone really knows that ebooks should be priced lower, but the old publishing world wants to be able to set much higher prices, forcing Amazon to basically make no money at all on pricing the books lower. Given this scenario, it actually makes sense for Amazon to then make this offer to authors directly: it will hand over 100% of ebook revenue, because under Hachette's proposal, Amazon would make no money at all (or even lose money) on ebook sales anyway.

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It wasn't even whistleblowing, although that too can destroy careers and lives. It was a FOIA request, made by someone who knew exactly which documents he wanted released.

His CIA career included assignments in Africa, Afghanistan and Iraq, but the most perilous posting for Jeffrey Scudder turned out to be a two-year stint in a sleepy office that looks after the agency’s historical files.

It was there that Scudder discovered a stack of articles, hundreds of histories of long-dormant conflicts and operations that he concluded were still being stored in secret years after they should have been shared with the public.

To get them released, Scudder submitted a request under the Freedom of Information Act — a step that any citizen can take, but one that is highly unusual for a CIA employee. Four years later, the CIA has released some of those articles and withheld others. It also has forced Scudder out.

"Historical documents of long-dormant conflicts and operations." Scudder dared to ask for these documents, and the CIA cut him loose. It also sent another federal agency after him -- the FBI.

On Nov. 27, 2012, a stream of black cars pulled up in front of Scudder’s home in Ashburn, Va., at 6 a.m. FBI agents seized every computer in the house, including a laptop his daughter had brought home from college for Thanksgiving. They took cellphones, storage devices, DVDs, a Nintendo Game Boy and a journal kept by his wife, a physical therapist in the Loudoun County Schools.

To date, only his daughter has received her laptop back. Every other computer remains in the hands of the FBI, despite the fact that no charges were ever pressed and despite the fact that many of the documents Scudder asked for have been released by the CIA in the interim. More from his request list are due to be released in the near future.

The CIA avails itself of a wide array of FOIA exemptions, but its reluctance to publish historical documents is just baffling -- and is most likely a result of the agency's long-running adversarial relationship with transparency. It's been noted here before that the CIA has used the often-abused b(5) exemption to withhold documents over five decades old (dealing with the Bay of Pigs invasion), claiming that the release of the "sensitive" documents would "confuse the public."

Despite Scudder's efforts, the flow of historical CIA documents will only decrease in the future. The office charged with declassifying historical documents has been closed, deemed expendable by the agency in the face of budget cuts. This workload will be routed through the agency's FOIA office, creating even more incentive for the CIA to stonewall requests.

Scudder never did anything his superiors thought was wrong until after he attempted to free these historical documents. Everything the agency never took issue with during his previous 18 years of employment -- like personal call infractions and the possession of photos (taken by Scudder in his position as "official CIA photographer") deemed "classified" -- was suddenly yet another reason to force him out. It's been clear for a long time that the government doesn't care much for whistleblowers. It also seems to have something against transparency, even concerning documents of historical interest only.

Scudder did nothing criminal. He just did something the agency didn't like. And for that, he lost his job and clearance. So, it's not just whistleblowing that can get you destroyed. It's also holding the government to its own transparency standards -- something that isn't remotely criminal but is apparently completely unforgivable.

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(Don Boudreaux)

Suppose that you are Nicholas Woodman.  You awaken one morning and discover from a news report that Bill Gates is 55 times – 55 times! - financially richer than you are.  How do you feel?  Envious?  Of course.  Relatively deprived?  How could you not suffer such a deflating sentiment?

In an absolute sense, you must admit, you live quite well.  You are one of the richest human beings ever to trod this earth (and, indeed, one of the richest to trod it in the relatively prosperous early 21st century).  Yet you understand from the “Progressive” ethos that what really matters is not one’s absolute standard of living over the course of a lifetime.  Instead, what matters (according to this ethos) is relative financial rankings today – that is, how much $$$ you are currently worth relative to how much $$$ other people are currently worth.  If other people have a great deal more money than you have, you are deprived.  You are entitled to feel envious and to pontificate about the immorality of such financial inequality.

So even though you, Nicholas Woodman, currently have a net worth of $1.3 billion, your financial wealth remains a paltry 1.8 percent of Bill Gates’s financial fortune of $72 billion.  Should you complain?  Should you demand government action to ‘redistribute’ some of Gates’s wealth to you?

Anyone who knows that you, Nicholas Woodman, are on the 2013 Forbes list of 400 richest Americans would think you to be insufferably envious, appallingly ungrateful, pathetically insensitive, unspeakably greedy, and, indeed, likely mentally unbalanced if you complained and moaned about how much more financial wealth Bill Gates currently has relative to the amount of financial wealth that you have.  You, after all, have daily and easy access to an array of goods and services that most people in the world can only dream, with futility, of ever enjoying.  And historically, your consumption possibilities – what you can and do daily consume – is indescribably greater than what any of your ancestors until just a generation or two ago could consume.  So why are you complaining?

You answer: “Because, relative to the richest American, I’m financially poor.”  And indeed, financially you have virtually nothing compared to Mr. Gates.  (What, after all, is a puny $1.3 billion relative to $72 billion?)

And yet I’m quite confident that no one would think your complaints to be justified.  I for sure would not think that your complaints are justified (should you in fact, rather than in my simple hypothetical here, actually issue such complaints).

….

So why do we in America today think it appropriate for middle-income (or even “poor”) Americans to complain about the financial wealth of rich Americans?  Middle-income, and even “poor,” Americans are among the richest human beings ever to breathe.  The goods and services that ordinary and “poor” Americans today consume on a daily basis are far larger in volume and far grander in variety than what most people on the globe today consume on a daily basis – and unimaginably greater than what ordinary (and even “rich”) people throughout most of history consumed on a daily basis.  Even Louis XIV never spoke in real time with anyone who was not within earshot of Louis’s royal voice.

In 2012 (the latest year for which I can find reliable data), the mean household income of the top 5 percent (income-wise) of American households was only 28 times larger than the mean household income of the bottom 20 percent (income-wise) of American households.  (The mean household income of the top 20 percent of American households was only 16 times larger than the mean household income of the bottom 20 percent of American households.)

And the minimum annual income necessary for a household to be in the top one percent in the U.S. in 2012 – just above $394,000 – means that even some one-percenter households have annual incomes that are ‘only’ 34 times larger than the annual incomes of the typical households in the bottom quintile.

In other words, the difference in the current financial income of a typical bottom-quintile American household in 2012 from that of each of the incomes of even some households in the top one percent is smaller than is the difference in the current financial status of Forbes‘s lowest-ranked American billionaire, Nicholas Woodman, (on its list of the 400 wealthiest Americans for 2013) and that of America’s wealthiest tycoon (Bill Gates).

So riddle me this: if we believe (as I suspect most of us do believe) that Nicholas Woodman would have no business envying or otherwise fretting about the size of Bill Gates’s fortune relative to his own, why do so many of us accept as appropriate the envying and fretting by middle-class and poor Americans about the size of the fortunes of the top ten or top one percent?  I can see no good reason.

…..

I understand that in the above I do not distinguish as carefully as I would in other contexts the differences between household incomes and individual incomes.  Nor do I – again, as carefully as I would in other contexts – either explain the especially great hazards of using data on household incomes (as opposed to individual incomes) or distinguish between income and wealth.  But none of these distinctions is relevant for the point of this post, which is that the difference between the financial well-being (however measured) of the person (Woodman) at the bottom of the Forbes‘s list of 400 richest Americans and that of the person (Gates) at the top of that list is greater than is the difference between the financial well-being of even poor Americans and that of many Americans in the top five percent or even the top one percent.

If billionaire Woodman ought not complain about the wealth (or income) of Bill Gates, then ordinary and even ‘poor’ Americans ought not complain about the wealth (or income) of the typical person or household in the top 20, 10, 5, or 1 percent.

Local school districts in Wisconsin are opting out of the onerous school lunch guidelines that have been pushed largely by First Lady Michelle Obama as part of her campaign to fight obesity, choosing instead to make their own guidelines about proper food nutrition at the local level.

As the Milwaukee-Wisconsin Journal Sentinel reports, Rick Petfalski, school board president of the Muskego-Norway School District, said, “We believe that proper food nutrition and meal portion guidelines are best decided at a local level.”

Petfalski’s school district’s decision to opt out of the National School Lunch Program means it will no longer receive federal money for its meals, but also that the district is free to serve whatever it wants.

“By leaving the program we will not be required to follow these onerous guidelines, pushed by and large by Michelle Obama, who last I checked has been elected by no one,” Petfalski said.

The school district will now cover the cost of free and reduced lunches on its own, though it was already losing money when it was part of Obama’s program because fewer kids were purchasing the meals. According to the Journal-Sentinel report, the school district will spend less on foods that students do not eat and, consequently, increase the number of children who purchase lunches by providing more satisfying meals.

Petfalski said his school district’s food service was projected to have nearly a $54,000 deficit. By opting out of the national program, he expects about a $7,100 surplus due to increased sales of food.

In addition to Muskego-Norway, the Waterford Graded School District, Waterford Union High School, which operates as a separate school district, and the Central High School District of Westosha, have opted out of Michelle Obama’s school lunch program.

“There was a lot of waste,” said Christopher Joch, Waterford Graded’s superintendent. “The food ended up in the garbage instead of the kids’ mouths.”

Joch said the decision to leave the national school lunch program was strongly supported by parents.

Not so happy 4th of July for residents and visitors of the Outer Banks. As Bloomberg reports, Arthur strengthened off the coast of North Carolina to become the first hurricane of the Atlantic season, packing maximum winds of 75 miles (120 kilometers) per hour. Officials have issued a mandatory evacuation order and a county-wide state of emergency has been declared.

 

 

As Bloomberg reports,

Arthur strengthened off the coast of North Carolina to become the first hurricane of the Atlantic season, packing maximum winds of 75 miles (120 kilometers) per hour.

 

The system was about 190 miles south-southwest of Cape Fear, North Carolina, the U.S. National Hurricane Center in Miami said in an advisory at 5 a.m. local time. It was traveling north at 9 miles per hour and is expected to move near to the North Carolina Outer Banks tonight, the advisory said.

 

“Hurricane Arthur is going to greatly affect the Outer Banks of North Carolina,” Rob Richards, meteorologist at State College, Pennsylvania-based AccuWeather Inc. said by phone today. “They could see winds as high as maybe 90 to 95 miles per hour with flooding rainfall.”

 

Arthur would be the first hurricane to hit the U.S. since 2012 should it strike North Carolina’s Outer Banks. A hurricane warning is in place from Surf City, North Carolina, to the border with Virginia, Pamlico Sound and Eastern Albemarle Sound, the notice said.

 

Officials in Dare County, North Carolina, where at least 250,000 vacationers are spending their Fourth of July holiday, issued a mandatory evacuation order for Hatteras Island beginning today. A countywide state of emergency was declared in neighboring Hyde

 

County, where officials called for a voluntary evacuation of Ocracoke Island. North Carolina Governor Pat McCrory declared states of emergency throughout coastal areas.

On the bright side the Keynesians will be cock-a-hoop - think of all the broken windows and GDP enhancing growth opportunities.

Meet #Arthur, the first hurricane of the 2014 Atlantic season: http://t.co/eqRLNpm8Qm pic.twitter.com/mUtcgrfbKN

— Reuters Top News (@Reuters) July 3, 2014

We wonder how accurate NOAA will be this year.,..

NOAA Forecasted Hurricane Ranges vs. Actual Number of Hurricanes: pic.twitter.com/7VAWjAv2u9

— Michael McDonough (@M_McDonough) July 1, 2014