Quotulatiousness

April 3, 2014

ESR reviews Jeremy Rifkin’s latest book

Filed under: Books, Economics, Media, Technology — Tags: , , , , — Nicholas @ 10:46

The publisher sent a copy of The Zero Marginal Cost Society along with a note that Rifkin himself wanted ESR to receive a copy (because Rifkin thinks ESR is a good representative of some of the concepts in the book). ESR isn’t impressed:

In this book, Rifkin is fascinated by the phenomenon of goods for which the marginal cost of production is zero, or so close to zero that it can be ignored. All of the present-day examples of these he points at are information goods — software, music, visual art, novels. He joins this to the overarching obsession of all his books, which are variations on a theme of “Let us write an epitaph for capitalism”.

In doing so, Rifkin effectively ignores what capitalists do and what capitalism actually is. “Capital” is wealth paying for setup costs. Even for pure information goods those costs can be quite high. Music is a good example; it has zero marginal cost to reproduce, but the first copy is expensive. Musicians must own expensive instruments, be paid to perform, and require other capital goods such as recording studios. If those setup costs are not reliably priced into the final good, production of music will not remain economically viable.

[…]

Rifkin cites me in his book, but it is evident that he almost completely misunderstood my arguments in two different way, both of which bear on the premises of his book.

First, software has a marginal cost of production that is effectively zero, but that’s true of all software rather than just open source. What makes open source economically viable is the strength of secondary markets in support and related services. Most other kinds of information goods don’t have these. Thus, the economics favoring open source in software are not universal even in pure information goods.

Second, even in software — with those strong secondary markets — open-source development relies on the capital goods of software production being cheap. When computers were expensive, the economics of mass industrialization and its centralized management structures ruled them. Rifkin acknowledges that this is true of a wide variety of goods, but never actually grapples with the question of how to pull capital costs of those other goods down to the point where they no longer dominate marginal costs.

There are two other, much larger, holes below the waterline of Rifkin’s thesis. One is that atoms are heavy. The other is that human attention doesn’t get cheaper as you buy more of it. In fact, the opposite tends to be true — which is exactly why capitalists can make a lot of money by substituting capital goods for labor.

These are very stubborn cost drivers. They’re the reason Rifkin’s breathless hopes for 3-D printing will not be fulfilled. Because 3-D printers require feedstock, the marginal cost of producing goods with them has a floor well above zero. That ABS plastic, or whatever, has to be produced. Then it has to be moved to where the printer is. Then somebody has to operate the printer. Then the finished good has to be moved to the point of use. None of these operations has a cost that is driven to zero, or near zero at scale. 3-D printing can increase efficiency by outcompeting some kinds of mass production, but it can’t make production costs go away.

Dave Barry – Rob Ford supporter

Filed under: Books, Humour, Media — Tags: , — Nicholas @ 08:23

David Harsanyi talks to Dave Barry about various topics:

In his new book, You Can Date Boys When You’re Forty: Dave Barry on Parenting and Other Topic He Knows Very Little About, America’s leading humorist takes on parenting, world affairs, pets, Justin Bieber and a slew of others topics that shouldn’t be this funny. We asked him about politics, libertarianism and God:

A lot of people are worried that we’re overprotective of children these days; making sure they never scrape a knee or have their feelings hurt. Would you consider yourself more of a helicopter parent or a free-range parent?

I’m free-range most of the time. I realize I’m being stereotypical, but I usually leave it up to my wife to keep track of most the details of my daughter’s life, such as is she eating, does she receive medical care, how old is she, etc. The exception is when boys come around, at which point I become more of a helicopter parent. Actually, I become a Predator Drone.

[…]

If you had to pick one politician that reflects everything that’s awful about politics today who would it be? And is there any politician that you’d feel good voting for?

I’d go with Anthony Weiner for part one of that question, and Rob Ford for part two.

September, 2014 – the potential start of “interesting times” in the UK

Filed under: Britain, Politics — Tags: , , — Nicholas @ 08:09

If Scotland votes in favour of separation from the United Kingdom this September, it will kick off a period of vast political uncertainty on both sides of the border:

The potential negotiations are all frighteningly close. In just six months time difficult discussions between the Scottish government and Whitehall could be getting under way. David Cameron would lead for the Rest of UK, but only as a weakened Prime Minister contemplating a legacy centred on the loss of the Union. His Westminster opponent Ed Miliband would have to contemplate the loss of many Labour MPs from north of the border. Meanwhile, Nigel Farage would presumably be jumping up and down shouting “bye-bye Scotland, close the door behind you” and stressing that England should be for the English. That view would, I suspect, be very popular after the Scots had raised two fingers at the English in the referendum.

In Scotland, once the Nationalists had woken up with a massive collective hangover, there would be bedlam too, with Salmond the victor and head of government demanding to lead for the Scots in negotiations on oil and so on. But should one man be allowed to create a separate state and dictate its constitution? Shouldn’t a wider group of founding fathers and mothers come up with a plan that Scottish voters can then be asked to approve? To help, the better Scottish MPs and peers at Westminster would very quickly have to go home to try and prevent Salmond turning the whole exercise into a massive vanity project. They would also have to stand for seats in the next Scottish parliament elections, or retire and pipe down.

All this would be taking place against a backdrop of economic uncertainty and intense emotional turbulence.

In such extraordinary circumstances, it is unlikely that English, Welsh and Northern Irish voters would put up with Scottish MPs trying to carry on as normal and then standing for election in 2015 as though nothing had happened. The Members of the Scottish Parliament would say that they now spoke for Scotland. The English, Welsh and Northern Irish at Westminster would be justified in saying later this year to those MPs from Scottish seats: what are you still doing here?

Big money in US politics gets bigger

Filed under: Media, Politics, USA — Tags: , — Nicholas @ 07:48

Jonathan Rauch looks at the implications of the McCutcheon decision of the US Supreme Court this week:

The 5-4 ruling along the usual conservative-liberal lines, while not unexpected, has broad implications. Like it or not — and assuredly, progressives do not like it — the era of effective limits on contributions to federal politicians is drawing to a close. Want to write a million-dollar check to support a candidate? Chances are that now, or someday soon, you can.

For four decades, since the campaign finance reforms of the 1970s, limits on big-dollar, direct gifts to politicians have been the beating heart of the progressive paradigm. Before McCutcheon, donors could give only $2,600 to an individual candidate in any one election cycle — and they could only give an aggregate of $48,600 to all campaigns. (Here’s the whole list of contribution limits.) In McCutcheon, the court struck down the aggregate limit, reversing its own prior holding in the seminal 1976 case Buckley v. Valeo.

[…]

A calamity for the 1970s paradigm? Yes. A calamity for progressives? Maybe not. There is a way forward, a potential win for both freedom and political accountability, though it requires progressives to hold their nose and swallow hard: raise contribution limits. A lot. A whole lot. Like, allow contributions of up to $1 million for presidential campaigns and up to $200,000 and $50,000, respectively, for Senate and House campaigns. (In 2012, an average winning Senate campaign spent $10.4 million, and a winning House campaign spent $1.6 million, according to Vital Statistics on Congress.) At the same time, as part of the deal, close the wide gaps in today’s rules requiring the disclosure of donations.

Wait. Allow Senate candidates to hit up victims — sorry, donors — for $200,000 at a time? Legitimize contributions of a size that virtually guarantees special attention from office-holders? Why should progressives conceivably support that? Because the old means no longer serve the desired ends. As of now, the case for low contribution limits has all but evaporated — even if you believe, as I do, that the limits once made sense and that the Buckley court was correct in upholding them.

One of the reasons those of us north of the border are often shocked at US political spending is that Canadian election campaign limits are a tiny fraction of the US numbers. You could run a national political campaign and candidates in every riding (308 in the last election) for less than the cost of seven average US senate races. This may explain the limited success of US campaign tactics (and tacticians) periodically imported from the US.

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