Month: October 2015

Feds Constrain Startups

(p. A15) Virtually every state has suffered a drop in startups, which suggests that this is a national, and not a regional or state, problem.
. . .
If history is any indication, many of today’s economic heavyweights will ultimately decline as new businesses take their place. Research by the Kaufman Foundation shows that only about half of the 1995 Fortune 500 firms remained on the list in 2010.
Startups also have declined in high technology. John Haltiwanger of the University of Maryland reports that there are fewer startups in high technology and information-processing since 2000, as well as fewer high-growth startups–annual employment growth of more than 25%–across all sectors. Even more troubling is that the smaller number of high-growth startups is not growing as quickly as in the past.
. . .
Surveys by John Dearie and Courtney Gerduldig, authors of “Where the Jobs Are: Entrepreneurship and the Soul of the American Economy” (2013), show that entrepreneurs report being hamstrung by difficulties in finding skilled workers, by a complex tax code that penalizes small business, by regulations that raise the costs of doing business, and by difficulties in obtaining financing that have worsened since 2008.

For the full story, see:
EDWARD C. PRESCOTT and LEE E. OHANIAN. “Behind the Productivity Plunge: Fewer Startups; New businesses were created at a 30% lower rate in 2012 than the annual average rate in the 1980s.” The Wall Street Journal (Thurs., June 26, 2014): A15.
(Note: ellipses added.)
(Note: the online version of the story has the date June 25, 2014.)

“You Can Recognize the People Who Live for Others by the Haunted Look on the Faces of the Others”

(p. C21) In her first book, “Strangers Drowning,” Larissa MacFarquhar, a staff writer for The New Yorker, reports . . . about extreme do-gooders, people whose self-sacrifice and ethical commitment are far outside what we think of as the normal range.
. . .
A line from Clive James’s memoir “North Face of Soho” comes to mind. He quotes the journalist Katherine Whitehorn: “You can recognize the people who live for others by the haunted look on the faces of the others.”
. . .
(p. C26) It was Kant who observed that, as the author writes, “it was fortunate that so few men acted according to moral principle, because it was so easy to get principles wrong, and a determined person acting on mistaken principles could really do some damage.”
. . .
Charity begins at home, most of us would agree. Not for many of the people in “Strangers Drowning.” In their moral calculus, the goal is to help the most people, even if that means neglecting those close by, even spouses or children.
One of the interesting threads Ms. MacFarquhar picks up is the notion that, for extreme altruists, the best way to help relieve suffering may not be to travel to Africa, let’s say, to open a clinic or help build a dam. It is far more noble and effective — though less morally swashbuckling — simply to find the highest-paying job you can and give away most of your salary. She finds people who live this way.

For the full review, see:
DWIGHT GARNER. “Books of The Times; Samaritans and Other Troublemakers.” The New York Times (Fri., SEPT. 25, 2015): C21 & C26.
(Note: ellipses added.)
(Note: the online version of the review has the date SEPT. 24, 2015, and has the title “Review: ‘Strangers Drowning’ Examines Extreme Do-Gooders.”)

The book under review, is:
MacFarquhar, Larissa. Strangers Drowning: Grappling with Impossible Idealism, Drastic Choices, and the Overpowering Urge to Help. New York: Penguin Press, 2015.

Smugglers Respond to Putin’s Ban on Cheese

(p. A4) When the Russian government banned dairy products from a host of nations, including the United States and members of the European Union, last year in response to Western economic sanctions imposed over Russia’s military meddling in Ukraine, President Vladimir V. Putin said the restrictions would create a profitable opportunity for domestic industries.
Instead they appear to have created an opening for forgers and smugglers. The “cheese ring” was busted with an estimated $30 million worth of the stuff, nearly 500 tons, according to the Interior Ministry police.

For the full story, see:
NEIL MacFARQUHAR. “A Crackdown in Russia on a Creamy Contraband.” The New York Times (Weds., AUG. 19, 2015): A4.
(Note: the online version of the story has the date AUG. 18, 2015, and has the title “Russian Police Get Tough on Illicit Cheese.”)

Bicycles Emancipated Women

BicycleWomanIn1890s.jpg

“A portrait from the 1890s at the Smithsonian Institution’s National Museum of American History. Susan B. Anthony said cycling did more to emancipate women than anything else in the world.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. D1) . . . , Twain promoted the new sport of cycling with characteristic rhubarb tartness. “Get a bicycle,” he urged readers. “You will not regret it, if you live.”
. . .
The full-bore bicycle fever was brief, and by the early 20th century it had given way to fascination with the automobile. Yet, as a new exhibit at the Smithsonian Institution’s National Museum of American History makes clear, the impact of the bicycle on the nation’s industrial, cultural, emotional and even moral landscape has been deep and long lasting.
In addition to air-filled rubber tires, we can thank the bicycle for essential technologies like ball bearings, originally devised to reduce friction in the bicycle’s axle and steering column; for wire spokes and wire spinning generally; for differential gears that allow connected wheels to spin at different speeds.
And where would our airplanes, tent poles and lawn furniture be without the metal tubing developed to serve as the bicycle frame? “The hollow steel tube is a great form,” said Jim Papadopoulos, an assistant teaching professor of mechanical and industrial engineering at Northeastern University in Boston. “It’s tremendously structurally efficient, light and strong, and it came into being for the bicycle.”
. . .
(p. D4) Bicycles also gave birth to our national highway system, as cyclists outside major cities grew weary of rutted mud paths and began lobbying for the construction of paved roads. The car connection goes further still: Many of the bicycle repair shops that sprang up to service the wheeling masses were later converted to automobile filling stations, and a number of pioneers in the auto industry, including Henry Ford and Charles Duryea, started out as bicycle mechanics. So, too, did the Wright brothers.
“The pre-story is so important,” said Eric S. Hintz, a historian with the Smithsonian’s Lemelson Center for the Study of Invention and Innovation. “You don’t get automobiles unless you first have bikes.”
. . .
By the mid-1890s, some 300 American companies were churning out well over a million bicycles a year, making the safety bike one of the first mass-produced items in history. Among the most exuberant customers were women, who discovered in the bicycle a sense of freedom they had rarely experienced before.
. . .
Bicycles allowed young men and women to tool around the countryside unsupervised, and relationships between the sexes grew more casual and spontaneous. With a bicycle at her disposal, a young woman could also venture forth in search of work.
Small wonder that Susan B. Anthony said of cycling, “I think it has done more to emancipate women than any one thing in the world.”

For the full story, see:
NATALIE ANGIER. “Basics; A Ride to Freedom.” The New York Times (Tues., JULY 14, 2015): D1 & D4.
(Note: ellipses added.)
(Note: the online version of the story has the date JULY 13, 2015, and has the title “Basics; The Bicycle and the Ride to Modern America.”)

Analyst Conflict of Interest in Predicting Tesla Stock Price

(p. A1) Just like the Internet stocks of yore, Tesla has its own Wall Street cheerleader: Adam Jonas, Morgan Stanley’s auto analyst. Jonas could not be less interested in mundane factors like earnings per share; indeed, he has had to lower his 2015 earnings estimates several times; he now predicts the company will lose $2.70 a share. But never mind: In the future that he envisions, Tesla will be the most important car company on earth.
Just a few weeks ago, in fact, Jonas raised his share price target for Tesla from $280 to $465, which would make Tesla more valuable than General Motors or Ford. Had anything fundamental changed for Tesla? Of course not!
Jonas based his new target on something he labeled Tesla Mobility, which he describes as “an app based, on-demand mobility service.” Where did he learn about Tesla Mobility? Who knows? Tesla, a company hardly averse to hype, has never acknowledged its existence.
And that’s not the worst of it. No, the worst is the timing of his call. It came days after Tesla announced that it would be issuing stock to raise yet more money — and that Morgan Stanley was among the underwriters. (The company raised close to $800 million.)

For the full commentary, see:
Joe Nocera. “The Tesla Cheerleader.” The New York Times (Sat., AUG. 29, 2015): A1 & A19.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date AUG. 28, 2015.)

“Words Can Obscure Rather than Illuminate”

(p. C6) In his essay “Politics and the English Language,” George Orwell shows how language is a tool of political control, how words can obscure rather than illuminate. Mr. Swaim explains how that applies to Mr. Sanford’s office. At one point, constituents start writing in to ask whether the governor plans to run for president. While Mr. Swaim is expected to answer the letters, he is also expected to deploy a whole lot of “platitudinous observations” and “superfluous phrases” to say, basically, nothing.
“The trick was to use the maximum number of words with the maximum number of legitimate interpretations,” he writes. “Words are useful, but often their meanings are not. Sometimes what you want is feeling rather than meaning, warmth rather than content. And that takes verbiage.”

For the full review, see:
SARAH LYALL. “Pumpting Up Hot Air to the Governor’s Level.” The New York Times (Thurs., JULY 30, 2015): C1 & C6.
(Note: the online version of the review has the date JULY 29, 2015, and has the title “Review: In ‘The Speechwriter,’ Barton Swaim Shares Tales of Working for Mark Sanford.”)

The book under review, is:
Swaim, Barton. The Speechwriter: A Brief Education in Politics. New York: Simon & Schuster, 2015.

Belgian Government Mandates Mayo to Be No Less than 80% Fat

(p. A1) BRUSSELS–Mayonnaise here is a sauce celebre, so important that a 60-year-old royal decree governs what goes in it.
. . .
Belgian mayonnaise must contain at least 80% fat and 7.5% egg yolk. European rivals are permitted to sell mayo with a mere 70% fat and 5% egg yolk.

For the full story, see:
TOM FAIRLESS. “No Yolk, Belgian Food Producers Fed Up with Mayonnaise Rules; But effort to relax royal recipe doesn’t go down well with chefs; yellow peas.” The Wall Street Journal (Mon., Sept. 20, 2015): A1 & A10.
(Note: ellipsis added.)
(Note: the online version of the story has the date Sept. 20, 2015 and the title “In Belgium, Mayonnaise Makers Want a New Recipe; But effort to relax royal recipe doesn’t go down well with chefs; yell;ow peas.”)

New Evidence Says Scientists Must “Start from Scratch” on Computer Weather Models

PlutoArmosphere2015-08-16.jpg“An image of Pluto’s atmosphere, backlit by the sun, captured by the New Horizons spacecraft as it zipped past the planet.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A13) Confounding expectations, Pluto’s atmosphere has actually thickened over the last 26 years, and many planetary scientists changed their minds. Maybe the atmosphere would persist throughout Pluto’s 248-year orbit, they speculated.

Now the story appears to be changing again. New Horizons obtained a snapshot of the structure of the atmosphere by looking at distortions in radio signals sent from Earth passing through Pluto’s atmosphere.
What the new measurement “seems to have detected is a potential for the first stages of that collapse just as New Horizons arrived,” Dr. Stern said. “It would be an amazing coincidence, but there are some on our team who would say, ‘I told you so.’ ”
Even if the atmosphere is collapsing, though, the view from the night side of Pluto is, at present, spectacularly hazy. A photograph showing a silhouette of Pluto surrounded by a ring of sunlight “almost brought tears” to the atmospheric scientists, Dr. Summers said, showing sunlight scattered by small particles of haze up to 100 miles above the surface.
“This is our first peek at weather in Pluto’s atmosphere,” he said.
Computer models had suggested that the haze would float within 20 miles of the surface, where temperatures are about minus 390 degrees Fahrenheit. Instead, the haze particles formed higher, 30 to 50 miles up, where temperatures are balmier, around minus 270.
“We’re having to start from scratch to understand what we thought we knew about the atmosphere,” Dr. Summers said.

For the full story, see:
KENNETH CHANG. “Pluto’s Atmosphere Is Thinner Than Expected, but Still Looks Hazy.” The New York Times (Sat., JULY 25, 2015): A13.
(Note: ellipses added.)
(Note: the online version of the article has the date JULY 24, 2015.)

Recent Job Losses from City Minimum Wage Hikes

(p. A13) The city councils in Seattle, San Francisco and Los Angeles have already voted to increase their minimum wage to $15 an hour over several years. For large employers in Seattle, the first increase to $11 from $9.47 took effect in April. In San Francisco a hike to $12.25 from $10.74 began in May. Los Angeles rolled out a minimum wage for hotel workers of $15.37 in July.
It’s still early to know how the hikes are affecting the job market, but the preliminary data aren’t good. Mark Perry of the American Enterprise Institute, Adam Ozimek of Moody’s Analytics and Stephen Bronars of Edgewood Economics reported last month that the restaurant and hotel industries have lost jobs in all three cities. Mr. Bronars crunched the numbers and discovered that the “first wave of minimum wage increases appears to have led to the loss of over 1,100 food service jobs in the Seattle metro division and over 2,500 restaurant jobs in the San Francisco metro division.” That is a conservative estimate, he notes, as the data include areas outside city limits, where the minimum wage didn’t increase.
This comes as no surprise. In 2014 the Congressional Budget Office found that increasing the minimum wage to $10.10 an hour would result in employment falling by 500,000 jobs nationally. By the way, less than 20% of the earning benefits would flow to people living below the poverty line, as University of California-Irvine economist David Neumark has pointed out.

For the full commentary, see:
ANDY PUZDER. “A Post-Labor Day, Minimum-Wage Hangover; The evidence is already coming in: Mandatory increases in Los Angeles, San Francisco and Seattle have cost thousands of jobs.” The Wall Street Journal (Tues., Sept. 8, 2015): A13.
(Note: the online version of the commentary has the date Sept. 7, 2015.)

Experts Are Paid “to Sound Cocksure” Even When They Do Not Know

(p. B1) I think Philip Tetlock’s “Superforecasting: The Art and Science of Prediction,” co-written with the journalist Dan Gardner, is the most important book on decision making since Daniel Kahneman’s “Thinking, Fast and Slow.” (I helped write and edit the Kahneman book but receive no royalties from it.) Prof. Kahneman agrees. “It’s a manual to systematic thinking in the real world,” he told me. “This book shows that under the right conditions regular people are capable of improving their judgment enough to beat the professionals at their own game.”
The book is so powerful because Prof. Tetlock, a psychologist and professor of management at the University of Pennsylvania’s Wharton School, has a remarkable trove of data. He has just concluded the first stage of what he calls the Good Judgment Project, which pitted some 20,000 amateur forecasters against some of the most knowledgeable experts in the world.
The amateurs won–hands down.
. . .
(p. B7) The most careful, curious, open-minded, persistent and self-critical–as measured by a battery of psychological tests–did the best.
. . .
Most experts–like most people–“are too quick to make up their minds and too slow to change them,” he says. And experts are paid not just to be right, but to sound right: cocksure even when the evidence is sparse or ambiguous.

For the full review, see:
JASON ZWEIG. “The Trick to Making Better Forecasts.” The Wall Street Journal (Sat., Sept. 26, 2015): B1 & B7.
(Note: ellipses added.)
(Note: the online version of the review has the date Sept. 25, 2015.)

The book under review, is:
Tetlock, Philip E., and Dan Gardner. Superforecasting: The Art and Science of Prediction. New York: Crown, 2015.