anti-monopoly politics

This Intercept article talks about an anti-monopoly message some Democrats are trying out. I like the idea in principle. Productivity growth has been stuck in second gear for close to 50 years now, and yet we hear about record corporate profits and stock market returns. These things happen at the same time only if big business is able to make unfair profits by rigging the system unfairly in its favor. That way their profits can grow while wages and innovation both stagnate. This is not a recipe for long-term growth for the economy as a whole.

Big business has been able to hijack the “free market” message for a long time now. Of course, a truly free market is about a truly level playing field for businesses of all sizes, and one where innovators can compete with established big businesses. I would argue that it is also about an economy where entrepreneurs and small business owners can take chances and innovate against a backdrop of health care, childcare and retirement security. But maybe that should not be the focus – one appeal of an anti-monopoly message could be to give the devisive social issues a rest for awhile and focus on inclusive economic growth.

The author gives several examples of monopoly power hurting both rural and urban interests:

FRERICK TALKS ABOUT running a Teddy Roosevelt-style campaign. In rural towns in southwest Iowa, he has challenged the merger between Monsanto and Bayer, which would give two companies (the other is Dow/DuPont) control of 75 percent of the U.S. corn seed supply. Add the company created by the merger of ChemChina and Syngenta, and three companies would sell 80 percent of all seeds. Farmers have no ability to bargain for corn seed, which has doubled in price over the last decade, even while crop prices have dropped…

But Frerick has a broader case to make on monopolies. In urban areas of Des Moines with less connection to farm life, he’s talked about cable companies who take hours to answer customer service calls, or shrinking local newspapers due to Facebook and Google’s capturing of prized eyeballs for advertisers. In older communities, he’s condemned pharmaceutical companies that funnel patients to expensive drugs with little or no competition. A separate 2016 paper Frerick wrote while at Treasury explained how drug companies use corporate charity as a profit center, by paying discounts for individuals so insurers and government plans have to pay exorbitant rates for medications…

Most hospitals buy supplies in bulk through group purchasing organizations (GPOs) which carry a “90/10” requirement. Hospitals must continue to purchase at least 90 percent of their supplies from inside the GPO to qualify for discounts and avoid millions of dollars in penalties. This contractual obligation fortified BD’s monopoly, despite selling a more dangerous, more expensive product.

September 2017 in Review

Most frightening stories:

  • Fueled by supercharged sea temperatures, the 2017 hurricane season was a terrible, terrible season for hurricanes devastating coastal regions of the United States. One reason is that these storms not only were powerful and hit densely populated areas, but they set records for rapid intensification. Beyond all the human suffering, one thing I find disturbing is that I feel desensitized at this point when I think back to how I felt after Hurricane Katrina. The first major city destroyed is a shock, but later you get numb to it if you are not actually there. Then finally, a remote island territory is all but wiped out in what should be shocking fashion, and the public and government response is decidedly muted. This is what the age of climate change and weapons proliferation might be like, a long, slow process of shifting baselines where the unthinkable becomes thinkable over time.
  • In a story that U.S. media didn’t seem to pick up, China seemed to make a statement in its  official state-run media that it would defend North Korea in case of an unprovoked attack by the U.S. and its allies. John Bolton  and Lindsey Graham made comments suggesting they think any number of Korean dead would be a price worth paying for an unprovoked U.S. attack. The Trump administration is openly using Nazi propaganda.
  • During the Vietnam War the United States dropped approximately twice as many tons of bombs in Southeast Asia as the Allied forces combined used against both Germany and Japan in World War II. After the Cold War finally ended, Mikhail Gorbachev made some good suggestions for how to achieve a lasting peace. They were ignored. We may be witnessing the decline of the American Empire as a result.

Most hopeful stories:

  • It’s possible that a universal basic income could save the U.S. government money by replacing less efficient assistance programs.
  • There are also workable proposals for a U.S. single-payer health insurance program, although this one would somewhat obviously mean the government spending more money, which it would have to collect in taxes. People would come out ahead financially if the taxes were less than the premiums they are paying now, which doesn’t seem that hard, but of course this is politically tough given the incredibly effective propaganda the finance industry has used to kill the idea for the last 50 years.
  • Utility-scale solar energy cost dropped 30% in one year.

Most interesting stories, that were not particularly frightening or hopeful, or perhaps were a mixture of both:

  • The FDA has approved formal trials of Ecstasy to treat post-traumatic stress disorder.
  • I learned that the OECD Science, Technology and Innovation Outlook named “ten key emerging technology trends”: The Internet of Things, Big data analytics, Artificial intelligence, Neurotechnologies, Nano/microsatellites, Nanomaterials, Additive manufacturing / 3D printing, Advanced energy storage technologies, Synthetic biology, Blockchain
  • In automation news, Tesla is testing automated truck platoons. And there’s a site that will try to predict whether robots will take your job.

autonomous trucks

This article from Wired brings up a couple points about autonomous trucks I hadn’t thought of before.

The startup Peloton is working on “platooning” trucks, or groups of vehicles that communicate via a wireless connection that helps them time their movements. At some point soon, the system might let a lead driver take over the steering for a bit, while those at the wheels in the vehicles behind could snooze, catch up on paperwork, meditate, whatever. California-based Embark would like to see driver-monitored trucks pilot themselves on interstates but be manually driven into warehouses by nimbler humans. Starsky Robotics has a similar vision, but says that the trickier driving maneuvers could be done by a human in a remote location, Predator drone-style. It’s unclear if any of these companies want—or will be able—to ever take the human out of the picture entirely…

So you could have one driver or no drives for a whole line of trucks on the highway. Then, when they get to town, a driver or even a remote driver could bring them in one at a time, if the computers are not yet up to the job.

One thing I think about is that this sounds a lot like trains. It’s hard for me to believe that platoons of trucks will be cost-effective with trains even after you take most drivers out of the equation. But remember that the highway system is automatically funded by all highway users through the gas tax, while rail companies are required to build and maintain their own infrastructure. Politicians in rural areas, which are greatly overrepresented in our electoral system at the state and federal levels, like this system because it makes taxpayers in the economically productive areas (aka cities) fund inefficient road networks in the mostly empty rural areas they represent. So this is not a level playing field where victory goes to the most efficient technology.

“sonic attacks” in Cuba

This is a bizarre story about “sonic attacks” on U.S. diplomats in Cuba.

The United States delivered an ominous warning to Americans on Friday to stay away from Cuba and ordered home more than half the U.S. diplomatic corps, acknowledging neither the Cubans nor America’s FBI can figure out who or what is responsible for months of mysterious health ailments…

To medical investigators’ dismay, symptoms have varied widely. In addition to hearing loss and concussions, some people have experienced nausea, headaches and ear-ringing. The Associated Press has reported some now suffer from problems with concentration and common word recall.

Some U.S. diplomats reported hearing loud noises or feeling vibrations when the incidents occurred, but others heard and felt nothing yet reported symptoms later. In some cases, the effects were narrowly confined, with victims able to walk “in” and “out” of blaring noises audible in only certain rooms or parts of rooms, the AP has reported

So the facts are that people are reporting symptoms and bizarre experiences, and nobody has figured out what or who is causing it.

estate tax and pants on fire

Donald Trump’s pants are on fire when he talks about the estate tax, according to Politifact.

How about small businesses and farms? The center projected that only about 80 small farms and closely held businesses would pay any estate tax in 2017. That would amount to about 1 percent of all payers of the estate tax that year. And the estate tax revenue from small businesses and farms, the center said, would amount to fifteen-hundredths of 1 percent of the total paid under the estate tax in 2017.

So, getting rid of the estate tax would hardly “protect millions of small businesses and the American farmer,” as Trump put it.

Trump’s claim doesn’t hold up even if you account for small businesses and farms that would potentially benefit from elimination down the road. The number from the Tax Policy Center (80) only refers to the number of small businesses and farms that would have to pay the tax this year.

When Donald Trump opens his mouth, all I see is diarrhea coming out. His words mean nothing to me. He has no interest in even trying to find out if the things he is making up are true. Is it possible he thinks they are true because he says them? It is a sad and embarrassing time to be an American.

U.S. recyclables sent to China

I had no idea this was going on, but it turns out a lot of what I put in my curbside recycling bin has been sent to China. According to Bloomberg it works something like this: Because of the large trade imbalance between the U.S. and China, container ships that bring manufactured goods from China to the U.S. would end up going back to China empty. Rather than doing that, they are willing to take recyclable trash back to China to next to nothing. And Chinese factories are very happy to have it as raw materials to manufacture more things to send to us. An interesting implication, to me, is that the volume of trade between the two countries must be roughly equal, but the weight and dollar amount must be very unequal.

Another interesting factoid is the top export categories (from the U.S. to China) by dollar amount:

The U.S last year exported more than 37 million metric tons of scrap commodities valued at $16.5 billion to 155 countries, said Adler of the Institute for Scrap Recycling Industries. China accounted for almost one-third of that total—about $5.2 billion.

By comparison, the top two export categories to China in 2016 were miscellaneous grain, seeds, and soybeans ($15 billion) and aircraft ($15 billion).

The focus of the article is actually that China is changing its rules to require cleaner materials before it will accept them, and that could disrupt this market. How dare they! I also heard on the fake news that giant killer hurricanes are actually a hoax created by the Chinese government.

U.S. home prices highest in riskiest areas

According to Bloomberg,

The chart comes from Attom Data Solutions’ natural hazard index, which matches geographic areas to government data on risk of flood, earthquake, tornado, wildfire, hurricane, and hail.

The riskiest 20 percent of U.S. counties have the most homes, the highest average home values, and the greatest price appreciation in recent years. Why? Buyers who pay premiums for ocean views and mountain lookouts may be getting some additional disaster risk as part of the bargain, said Daren Blomquist, senior vice president at Attom. Those kinds of geographical attributes are likely secondary factors in driving price appreciation, though. More importantly, Attom’s list of disaster-prone areas overlaps with engines of economic activity.

This makes sense to me – it is probably just that the big, vibrant U.S. cities are in hurricane and flood prone coastal areas, in fire-prone Mediterranean climates, or both. Climate change is not going to reduce these risks. Having the earthquake risk thrown on top is kind of just bad luck.

game of (bee) thrones

Queen bees demand, and receive, absolute loyalty from their hives. When they are nearing the end of their reigns, they try to arrange to keep their family in power and have one of their daughters assume the throne. But that doesn’t always work out and the struggle over succession can be pretty brutal. This might give George R.R. Martin some ideas.

As far as I can tell, my queen died sometime in the spring. Queens typically live for about four or five years, so this caught me by surprise. A new queen, however, is a regular event in the life of a hive. Beekeepers frequently replace their queens every year or two to introduce genetic variety and ensure that the hive has a strong monarch who can lay enough eggs to keep the population up. Bees can also raise their own queen, and when I did an inspection early that spring, I was pleased to see that mine had taken the initiative. Before she died, my old queen must have laid a few fertilized eggs that worker bees raised as replacements. They would have selected six or seven fertilized (female) eggs and fed them only royal jelly. When the first queen hatched, she would have immediately killed any unhatched competition and ideally flown a few mating flights, storing enough semen in her abdomen to spend the rest of her life laying eggs.

While a newborn queen may seem ruthless, the success of a beehive hinges on allegiance to its queen. Though she can mate with an average of 12 different drones, there is only one queen, which makes for a hive of closely related bees. As a new queen begins to produce her own pheromones, the hive slowly aligns with her as the old bees die and new workers hatch. In a sense, the hive is genetically wired to be loyal to the monarchy. If the hive was to raise multiple queens, or if the workers were to start laying eggs, the interests of the population would slowly fracture…

Bees have about 165 pheromone receptors on their antennae and though it’s not entirely clear how workers “decide” what to do and when (the question of agency is still very much up for debate), it is certain that the queen’s pheromones prompt them to go about their business. When the reigning monarch dies or stops laying eggs in her old age, the change in her pheromones prompts the hive to raise a replacement, as my hive had done. Similarly, if a new queen arrives and releases her pheromones before those of the old queen have dispersed, the hive will consider the new queen an invader, and kill her. Above all, they are loyal to their queen. I did not fully grasp this fact. Because I waited only six hours between queens, the worker bees probably stung my new queen to death within an hour.

lugenpresse

Today’s German lesson: lugenpresse translates literally as “lying press”, but it wouldn’t be much of a stretch to translate it as “fake news”. In fact, the German version was heard at rallies during the Trump campaign apparently. This is a bit of history on the term from the Washington Post:

A decade later [the 1920s], it had turned into an explosive and stigmatizing propaganda slogan, used to stir hatred against Jews and communists. Critics of Adolf Hitler’s regime were frequently referred to as members of the “Lügenpresse apparatus.”

Until today, the word has an anti-Semitic connotation, and it implies hatred not only against journalists but against everyone who opposes the “will of the people.” That abstract concept emerged during World War II when Hitler sought to propagate the idea that Germans were a “master race” superior to all others, especially Jews and Slavic people.

The consequences of that rhetoric — of which the term “Lügenpresse” was an important component under propaganda minister Joseph Goebbels — were horrifying. Millions of people were killed in concentration camps by the Nazis, including Jews, political opponents and homosexuals.

Trump is ignorant of history at a minimum, and I think he has fascist tendencies. But I am only now beginning to think he is using actual, thinly-veiled Nazi-inspired propaganda. It’s evil.