Quotulatiousness

January 13, 2018

The common factor of the Net Neutrality fight and the EpiPen price gouging scandal

Filed under: Bureaucracy, Economics, Government, Health, Technology, USA — Tags: , , , , — Nicholas @ 05:00

Lili Carneglia explains what these two examples of “capitalist excess” are actually the result of regulatory failures:

Without net neutrality, regulations that prevent internet service providers (ISPs) from charging more for priority speeds and higher bandwidth-use sites would disappear. Most Americans are pretty confused by the revised rules but highly skeptical that this action could have any benefits. Many people, especially those living in the rural south where choices are limited, feel like these companies have been taking advantage of their customers for years, and loosening regulatory constraints on these companies seems like a terrible idea.

Net neutrality was a regulatory policy set under the Obama administration in 2015 that mandated ISPs to treat the internet like other utilities, such as highways and railroads, under laws established before most people had TVs. Under these rules, companies must act as neutral gateways to the internet without controlling the content or the speed of the content that passes through that gateway. Supporters of the rule argue that these regulations ensure the free flow of information, while those against the policy see net neutrality as a misapplication that stifles an industry that is more dynamic than other public utilities.

[…]

Yes, a handful of industry giants can and have abused their market power. Most consumers have limited ISPs to choose from in a given area, and options are more limited outside of big cities, where “three-quarters of American homes have no competitive choice for the essential infrastructure for 21st-century economics and democracy,” according to the former FCC chairman Tom Wheeler. It is important to consider how these circumstances came about before deciding that federal regulation might help consumers.

Governments, by and large, prefer to have fewer players in a given market as it makes that market easier to regulate, and the easiest market to regulate is a monopoly. When cable networks were beginning to spread across North America, many local governments were persuaded that a single cable provider would be the best option for their jurisdiction and the broadband internet market that came later was heavily shaped by the already carved-up markets for cable TV. For many, there were no competitive options because the local government had precluded the chance of competition for their already entrenched cable monopoly (or, in a few cases, tight oligopoly).

Competition is the best answer to monopolistic abuse of customers … if you get shitty service from the Blue Cable Company, you’ll be more likely to switch to the Red Cable Company. If you only have Red and Blue to choose from, your leverage is small, but if you have a full rainbow of competing options, Red and Blue are forced to make their services at least comparable to what Orange and Pink and Magenta are offering, or they lose too many customers. If there’s no threat of a competitor scooping up unhappy customers, there’s no incentive for the existing company to do more than the absolute minimum to keep customer complaints down to a dull roar. The customer’s only recourse — other than giving up the service or moving to a different jurisdiction — is to complain to the regulator.

The base problem with Mylan’s EpiPen price gouging is the same: an effective monopoly supported by the government:

The arguments against net neutrality repeals center around fears about what producers will do without regulation since they have significant market power and the ability to raise prices to levels that would not be sustainable under more competitive conditions. The concern about increased internet prices is similar to what happened in 2016 when a pharmaceutical company with market power, Mylan, increased the price of life-saving EpiPens by about 400 percent.

The “greedy” pharmaceutical companies were hung out to dry as Congress berated Mylan representatives in hearing after hearing. There were similar cries of outrage and demands that the federal government do something to prevent such selfish price-gouging, similar to what many consumers fear ISPs will do absent regulations.

Even (supposed) free-market advocates started supporting further regulation during the EpiPen debate. Most notably, then fiscal hawk representative and now Trump budget director Mick Mulvaney, defended further market intervention on the condition that, “If you want to come to the state capitols and lobby us to make us buy your stuff, this is what you get. You get a level of scrutiny and a level of treatment that would ordinarily curl my hair.”

However, in all of those hearings, almost no one bothered to unearth the problem that Mulvaney hinted at: Why was Mylan able to increase that price in the first place? Government intervention. Burdensome FDA regulations and other laws pressuring public schools to buy the drug essentially granted Mylan a monopoly. It was as misguided then as it is now to think that these same institutions can be trusted to clean up the mess they created.

Mylan had no effective competition, so there was nothing to stop the price gouging until it got so bad that even the regulator had to pay attention. If there were other pharmaceutical companies allowed to compete, do you think Mylan would have risked jacking up the price only to watch their competitors gaining market share?

Scott Alexander explained the Mylan monopoly quite expansively in 2016.

QotD: Occupational licensing

Filed under: Bureaucracy, Business, Quotations, USA — Tags: , — Nicholas @ 01:00

When my mother retired from selling real estate, she toyed with the idea that she — a talented cook who had long made her own croissants — might make a little money on the side by selling homemade baked goods. It’s the sort of business that people have started from time immemorial, letting them share what they love with someone willing to pay for it.

A quick investigation, however, revealed that the thing was impossible. You can’t just bake a little stuff at home and sell it, for fear that you might poison people. If you want to poison people with your deliciously flaky homemade croissants, it must be done on a strictly ad-hoc, volunteer basis.

Welcome to the modern economy, where increasingly, everything not compulsory is forbidden. We are hedged around with rules to protect us, to protect other people, to protect some theoretical victim who exists only in the minds of regulators and judges. And there’s reason to worry that this red tape is getting wrapped so tight that it risks rendering us immobile.

I’m not talking about environmental regulations, or even the labor regulations that make it increasingly expensive and burdensome to employ people. Today I’m talking about occupational licensing, and the burden it places on people who want to build a career.

Megan McArdle, “You’re Gonna Need a License for That”, Bloomberg View, 2016-05-17.

January 9, 2018

The ongoing financial catastrophe that is the National Shipbuilding Procurement Strategy

Filed under: Australia, Bureaucracy, Business, Cancon, Military — Tags: , , , , , — Nicholas @ 03:00

Ted Campbell rounds up recent discussions of the Canadian government’s farcical National Shipbuilding Procurement Strategy (NSPS):

There is a somewhat biased but still very useful look at the successes of the National Shipbuilding Procurement Strategy (NSPS) in the Ottawa Citizen by Howie Smith who is the Past President of the Naval Association of Canada. Mr Smith is a retired Canadian naval officer who has provided consultancy services to several firms pursuing opportunities within the projects of the National Shipbuilding Strategy, which is why his article is somewhat biased. Mr Smith is responding to a recent report by Professor Michael Byers of the University of British Columbia, who is also a biased commentator on defence issues, which said that the NSPS “was flawed from the outset” and “According to Byers, the Liberal government should open-up the non-contractually-binding umbrella agreements with Irving and Seaspan, then cancel and restart the Canadian Surface Combatant and the Joint Support Ship procurement programs with fixed-price competitions involving completely ‘off the shelf’ designs.”

It is important, I believe, to understand why Canada needed something like the NSPS in the first place. The notion came in about the middle of the Harper government’s term in office – in around 2010. I think that two problems confronted the government:

  • The Canadian shipbuilding industry was, once again, “on the ropes;” Davie, Canada’s largest shipyard was in bankruptcy and the other yards were too reliant on government contracts; and
  • Both of the major federal fleets (the Royal Canadian Navy and the Canadian Coast Guard) were approaching “rust out,” again.

The solution to the first problem was to modernize the yards and make them internationally competitive … but that would cost money and private investment money is scarce ~ especially for shipbuilding, plus under the international trade rules to which Canada has agreed direct government subsidies to commercial shipyards are prohibited. The solution to shipyards that are too reliant on government contracts was ~ wait for it ~ another big government contract that would allow them to modernize themselves.

That indirect government subsidy is perfectly legal if the contracts are for navy and coast guard ships because “national security” is a big loophole in international trade law.

Both Professor Byers and Mr Smith have some good points … but neither is 100% correct. The NSPS was and remains a sound idea … the costs, which is the real crux of Professor Byers’ complaint, are not relevant because the defence and coast guard budgets are being (mis)used for industrial development ~ those are not the real costs of warships: they are the real costs of warships PLUS the cost of yard modernization.

The new surface combatant project is, as Mr Smith says, the biggest and costliest peacetime military procurement ever … and the NSPS is working just about a well as any “system” would at bringing it to fruition. At some point in the future a government will have to decide if Canada gets fewer ships than it needs or spends more more money than it wants … or, most likely, both.

That last sentence has always been the most likely outcome: the RCN will get fewer ships than it needs, and those ships will be significantly more expensive per hull than they need to be. The need for modern naval vessels isn’t the top priority … it’s probably not even in the top three priorities as far as the government is concerned (directing money to the “right” recipients, pandering to provincial sensibilities, lots of photo ops, and then maybe the actual needs of the RCN and CCG).

Update: Of course, it’s not like Canada is unique in the problems we have in military procurement … Australia is also struggling in a similar way:

The [Royal Australian] Navy’s program to replace the Collins Class submarines is known as SEA 1000. It involves modification of a French Barracuda Class submarine from nuclear to diesel-electric propulsion, plus other changes specific to Australia.

The 12 new submarines, to be known as Shortfin Barracudas, are intended to begin entering service in the early 2030s with construction extending to 2050. The program is estimated to cost $50 billion and will be the largest and most complex defence acquisition project in Australian history.

[…]

Then there’s the decision to build them in Australia. The Abbott government’s 2016 Defence White Paper only committed to building them in Australia if it could be done without compromising capability, cost or project schedule. That changed because of South Australian politics, and the new submarines could now be more appropriately described as the Xenophon class.

Even if all goes well, the cost of building warships in Australia will be 30 to 40 per cent more than if they were built overseas. However, the plan to build them in Adelaide at the Australian Submarine Corporation, the same group currently building the Air Warfare Destroyer, years late and a billion dollars over budget, adds to a sense of foreboding.

This follows the prize fiasco of the Collins Class submarine project. Their construction by the Australian Submarine Corporation ran years behind schedule, many millions over budget, and finally delivered a platform that the Navy has struggled to even keep operational.

And then there is the question of whether the new submarines will arrive before the Collins Class subs are retired, scheduled for 2026 to 2033. Even if delivery occurs on schedule, the first will not enter service until 2033. At best there will be one new submarine in service and a nine year gap between the retirement of the Collins Class and the introduction into service of the first six of the twelve new submarines.

Given this, the government has apparently committed an additional $15 billion to keep the 30 year old Collins submarines bobbing in the water. It’s like refurbishing a World War 2 German U-Boat for the mid-1990s.

The elements are all there for the submarine replacement program to become the procurement scandal of the century. Our Shortfin Barracudas will probably be the most expensive submarines ever built anywhere in the world.

For a lot less money, we could achieve a far more potent submarine capability. For example, off-the-shelf Japanese Soryu submarines cost only US$540 million. Modified to meet additional Navy requirements, they were quoted as costing A$750 million. If we simply bought twelve of those, the total cost to the taxpayer would be less than A$10 billion.

Equally, the existing nuclear Barracudas only cost $2 billion each, so we could get twelve of those for $24 billion.

For such an important defence capability, the government’s failure to guarantee Australia is protected by submarines is nothing less than gross negligence.

December 29, 2017

2017 wasn’t all doom and gloom and Trump tweet wars

Veronique de Rugy manages to find three things that 2017 produced that somehow didn’t kill millions of Americans (so far, as far as we know):

First, President Donald Trump just signed a historic reduction in the corporate income tax rate, from 35 percent — the highest of all industrialized nations — to 21 percent. And except for a one-time repatriation tax, the U.S. will no longer tax most profits made by businesses overseas.

Both changes should boost economic growth and American workers’ wages. Moreover, the reform removes many of the distortions that discourage companies from investing foreign-earned income in the United States and prompt them to use tax avoidance techniques.

Second, this was a very good year for deregulation. Cutting taxes isn’t the only way to boost growth and raise wages; innovation may matter even more. Getting rid of duplicative and outdated regulatory hurdles to innovation promises to have a real impact on our lives. That’s what the Trump administration, with the help of Congress, seems committed to doing.

When the president first got to the White House, for example, he froze many not-yet-implemented Obama-era regulations. These include the punishing overtime pay regulation, which would have increased the cost of employing workers and ultimately reduced their base compensation to offset the increase in overtime pay.

[…]

Last but not least are the sustained efforts by Sens. Pat Toomey, R-Pa., and Richard Shelby, R-Ala., to slow down the process that would restore the Export-Import Bank, a bastion of cronyism, to its full and former glory.

Appointing enough board members to give Ex-Im a full quorum would instantly restore the agency’s ability to sign off on deals above $10 million for the benefit of a handful of very large foreign and domestic corporations. By resisting, the two senators are fighting a lonely fight on behalf of the unseen victims of corporate welfare.

December 25, 2017

QotD: Sir Humphrey’s bureaucratic holiday wishes

Filed under: Bureaucracy, Humour, Quotations — Tags: — Nicholas @ 01:00

Sir Humphrey: I wonder if I might crave your momentary indulgence in order to discharge a by no means disagreeable obligation which has, over the years, become more or less established practice in government service as we approach the terminal period of the year — calendar, of course, not financial — in fact, not to put too fine a point on it, Week Fifty-One — and submit to you, with all appropriate deference, for your consideration at a convenient juncture, a sincere and sanguine expectation — indeed confidence — indeed one might go so far as to say hope — that the aforementioned period may be, at the end of the day, when all relevant factors have been taken into consideration, susceptible to being deemed to be such as to merit a final verdict of having been by no means unsatisfactory in its overall outcome and, in the final analysis, to give grounds for being judged, on mature reflection, to have been conducive to generating a degree of gratification which will be seen in retrospect to have been significantly higher than the general average.

Jim Hacker: Are you trying to say “Happy Christmas,” Humphrey?

Sir Humphrey: Yes, Minister.

December 24, 2017

Repost – Hey Kids! Did you get your paperwork in on time?

Filed under: Bureaucracy, Humour — Tags: , — Nicholas @ 03:00

If you hurry, you can just get your Santa’s Visit Application in before the deadline tonight!

December 23, 2017

Words as weapons, words as tools

Filed under: Bureaucracy, Government, Media, Politics, USA — Tags: , , — Nicholas @ 04:00

In City Journal, Howard Husock looks at the recent media fuss about certain words being “banned” by Trump or the Republicans:

A political tempest arose last week when the Washington Post reported that the Department of Health and Human Services had banned the use of certain words or phrases — “vulnerable,” “science-based,” and “entitlements,” among others — in official budget documents. National Affairs editor Yuval Levin debunked the story, though, finding instead that bureaucrats concerned about offending Republican budget overseers had, in fact, decided to censor themselves. If so, that suggests that the bureaucrats have been reading their George Orwell, who observed in his classic essay “Politics and the English Language” that language is “an instrument which we shape for our own purposes”; they are sharp enough to realize that even neutral terms can constitute mini-arguments. Each of the terms in question — and a great many more — have been weaponized for use in political conflict.

“Vulnerable,” for example, is a substitute for “poor” or “low-income,” but it usually suggests that the person in question should not be considered in any way responsible for his or her situation, because social conditions that transcend individual action have stacked the deck adversely. “Science-based” is a pithy way to characterize the views of one’s political opponents as ignorant or superstitious. The belief that climate change will prove catastrophic is said to be science-based; any view that minimizes the risk constitutes “denial,” another noun that has become an argument. The widely used “entitlement” has also become an argument. The idea that all citizens are “entitled” to certain forms of financial support — checks for those above a certain age, health insurance for those below a certain income — implies no other way of seeing the situation. Those who would change the way entitlements are disbursed, then, are impinging on rights, not programs.

Other examples abound. “Disadvantaged” describes low-income children — while implying that other children are advantaged — and thus that the system is unfair and violates “social justice,” another loaded term. The “homeless,” by and large, are not living on the street but are often doubled up with friends or family; they don’t have their own home, in other words. But the word-picture painted by “homeless” is more powerful. The Right plays the same game. “Death tax” as a substitute for “estate tax,” for example, characterizes a debatable policy as an immoral absurdity.

December 20, 2017

Repost – Happy holiday travels!

Filed under: Bureaucracy, Humour — Tags: , , , — Nicholas @ 03:00

H/T to Economicrot. Many many more at the link.

December 13, 2017

QotD: Licensing and entrepreneurship

Filed under: Bureaucracy, Business, Quotations, USA — Tags: , , — Nicholas @ 01:00

Much as I love Silicon Valley, its cultural dominance has disastrously corrupted our sense of what entrepreneurship is. Talking about starting your own business, and too many people think the measure of success is whether you can sell the thing for at least a couple of hundred million dollars. Most entrepreneurship is considerably more humble than that; it is individuals with some talent, or a willingness to work hard, who want to sell their services to the public. They may never employ another person; they may not even work full time themselves. And these people never buy gracious mansions, or endow scholarships, or get buildings named after them. They just make their own lives a little bit better, hopefully, in the process of doing the same for their customers. We are artificially stopping that process, in order to protect insiders who already have the job.

That’s great for the insiders, who get above-average job stability and wages. But it’s terrible for the folks who are outside. And the more industries we put under the control of such regimes, the more the outsiders will show up in our economic data as people permanently stuck at the bottom.

We can do better than that. The problem is that such regimes are politically very stable, because the benefits are highly concentrated, while the costs are diffuse. Every licensed interior designer is passionately interested in shutting out unlicensed competitors, but their potential customers probably have better things to do than phone up their senators to demand to know why they can’t hire this chap they just met who has absolutely splendid taste in early Chippendale.

Megan McArdle, “You’re Gonna Need a License for That”, Bloomberg View, 2016-05-17.

December 12, 2017

QotD: The development of all the various university “studies” departments

Filed under: Bureaucracy, Education, Quotations, USA — Tags: , , , — Nicholas @ 01:00

After the 1960s cultural revolution, it was clear that the humanities had become too insular and removed from social concerns and that they had to reincorporate a more historical perspective. There were many new subject areas of contemporary interest that needed to be added to the curriculum — sex and gender, film, African-American and Native American studies among them. But the entire humanities curriculum urgently demanded rethinking. The truly radical solution would have been to break down the departmental structure that artificially separated, for example, English departments from French departments and German departments. Bringing all literature together as one field would have created a much more open, flexible format to encourage interdisciplinary exploration, such as cross-fertilizations of literature with the visual arts and music. Furthermore, I wanted an authentic multiculturalism, a curriculum that affirmed the value and achievements of Western civilization but expanded globally to include other major civilizations, all of which would be studied in their chronological unfolding. Even though I am an atheist, I have always felt that comparative religion, a study of the great world religions over time, including all aspects of their art, architecture, rituals, and sacred texts, was the best way to teach authentic multiculturalism and achieve world understanding. Zen Buddhism was in the air in the 1960s as part of the legacy of the post-war Beat movement, and Hinduism entered the counterculture through the London scene, partly because of Ravi Shankar, a master of the sitar who performed at California’s Monterey Pop Festival in 1967.

However, these boundary-dissolving expansions were unfortunately not the route taken by American academe in the 1970s. Instead, new highly politicized departments and programs were created virtually overnight — without the incremental construction of foundation and superstructure that had gone, for example, into the long development of the modern English department. The end result was a further balkanization in university structure, with each area governed as an autonomous fiefdom and with its ideological discourse frozen at the moment of that unit’s creation. Administrators wanted these programs and fast — to demonstrate the institution’s “relevance” and to head off outside criticism or protest that could hamper college applications and the influx of desirable tuition dollars. Basically, administrators threw money at these programs and let them find their own way. When Princeton University, perhaps the most cloistered and overtly sexist of the Ivy League schools, went coeducational after 200 years in 1969, it needed some women faculty to soften the look of the place. So it hastily shopped around for whatever women faculty could be rustled up, located them mostly in English departments at second-tier schools, brought them on board, and basically let them do whatever they wanted, with no particular design. (Hey, they’re women — they can do women’s studies!)

I maintain, from my dismayed observation at the time, that these new add-on programs were rarely if ever founded on authentic scholarly principles; they were public relations gestures meant to stifle criticism of a bigoted past. In designing any women’s studies program, for example, surely a basic requirement for students should be at least one course in basic biology, so that the role of hormones in human development could be investigated — and rejected, if necessary. But no, both women’s studies and later gender studies evolved without reference to science and have thus ensured that their ideology remains partisan and one-dimensional, stressing the social construction of gender. Any other view is regarded as heresy and virtually never presented to students even as an alternative hypothesis.

Today’s campus political correctness can ultimately be traced to the way those new programs, including African-American and Native American studies, were so hastily constructed in the 1970s, a process that not only compromised professional training in those fields over time but also isolated them in their own worlds and thus ultimately lessened their wider cultural impact. I believe that a better choice for academic reform would have been the decentralized British system traditionally followed at Oxford and Cambridge Universities, which offered large subject areas where a student could independently pursue his or her special interest. In any case, for every new department or program added to the U.S. curriculum, there should have been a central shared training track, introducing students to the methodology of research and historiography, based in logic and reasoning and the rigorous testing of conclusions based on evidence. Neglect of that crucial training has meant that too many college teachers, then and now, lack even the most superficial awareness of their own assumptions and biases. Working on campus only with the like-minded, they treat dissent as a mortal offense that must be suppressed, because it threatens their entire career history and world-view. The ideology of those new programs and departments, predicated on victimology, has scarcely budged since the 1970s. This is a classic case of the deadening institutionalization and fossilization of once genuinely revolutionary ideas.

Camille Paglia, “The Modern Campus Has Declared War on Free Speech”, Heat Street, 2016-05-09.

December 11, 2017

QotD: Occupational licensing

Filed under: Bureaucracy, Government, Law, Liberty, Quotations — Tags: , , , — Nicholas @ 01:00

… occupational licensing laws and Competitor’s Veto laws exclude would-be entrepreneurs from the marketplace — with disproportionately negative consequences for members of minority groups — […] Congress could act today to protect the fundamental human right of economic liberty against unjust state interference.

Licensing laws tend to have particularly harsh consequences on members of minority groups for a couple reasons. First, if a law requires a person to have, say, a college degree to practice the trade of interior design (which is the law in Florida), people who have less money and time to spend in college will find that avenue of opportunity closed to them. Since black and Hispanic Floridians are about 30 percent less likely to have a college degree, they will suffer more from this absurd licensing requirement than others will. Competitor’s Veto laws that forbid a person from practicing a trade unless they get permission from the businesses already operating in that industry are also very likely to create a sort of Old Boys Network, and to exclude entrepreneurs who lack political connections. Second, in a more general sense, any law that restricts economic opportunity for some to benefit others — as licensing laws tend to do — are likely to benefit those who have more political influence and can therefore get the government to regulate in ways favorable to them. Since members of minority groups have less political influence, they tend to be the ones excluded.

Timothy Sandefur, “Testifying to the U.S. Senate Oversight Subcommittee Tuesday about economic liberty and minorities”, Freespace, 2015-09-30.

December 2, 2017

Goat Yoga Gets Baaaaaa-nned

Filed under: Bureaucracy, USA — Tags: , — Nicholas @ 06:00

ReasonTV
Published on 1 Dec 2017

Good, old-fashioned goats and the ancient Hindu practice of yoga are two things that don’t seem to go together.

And yet, last year, a small farm in Corvallis, Oregon started offering classes that combined the two. Goat yoga is exactly what it sounds like: the practice of yoga in the presence of goats.

—————-

Soon these classes had a 900-person waiting list for an hour of ritual calisthenics with a bunch of horned ruminants.

Within a year, the unlikely trend had spread across the nation.

“We would go through the different asanas and the different flows,” explains Amanda Bowen, a goat-yoga instructor in Maryland, “and the goats will come around and interact with people as we’re doing the class.”

And then the unstoppable force of goat yoga locked horns with the immovable object of the Washington, D.C. Department of Health.

When Congressional Cemetery Director Paul Williams applied for a livestock permit in the District of Columbia, he was greeted by four lawyers “ready to throw every curve ball they possibly could at me to prevent goat yoga.”

But goat springs eternal. Since Manchester, N.H. reversed its ban late last summer, the only place in the country where risk-averse municipal bureaucracies are undermining this fitness-to-farm trend threat is the nation’s capital.

Produced, shot, narrated, and edited by Todd Krainin.

November 24, 2017

Rensselaer Polytechnic Institute makes Title IX applicable to non-students

Filed under: Bureaucracy, Education, USA — Tags: , , , — Nicholas @ 03:00

I only know about Rensselaer Polytechnic Institute due to the model railway club on campus, but the school should be more widely known now, if only as an object of derision:

Today, we’re writing about RPI’s attempt to subject a student from a different school to its disciplinary process — an attempt we’re only learning about because a court had to order RPI to stop violating the rights of John Doe (who used a pseudonym in his lawsuit). In a Nov. 6 ruling in Doe’s favor, a New York state court judge deemed RPI’s conduct “arbitrary” and “capricious,” and annulled RPI’s finding that Doe had sexually assaulted an RPI student.

This story begins in 2015 when Doe, a graduate student at a school that is not RPI, was in a relationship with an RPI student. Doe had never been a student at RPI. His only connection to RPI was his relationship with an RPI student. In the summer of 2016, after the relationship ended, the RPI student filed a Title IX complaint with RPI against Doe. As the court would later observe, the alleged conduct at issue in this case “took place off campus and was not in anyway (sic) related to an educational program or activity of RPI,” and that RPI “would have learned this from the complaint itself and statements made by the complainant.” Despite this, RPI launched an of Doe and interviewed him. Per the court, the interview constituted “a clear violation of [Doe’s] constitutional rights.”

It is not difficult to see why the interview raised concerns with the court. First, RPI conveniently failed to tell Doe why it needed to interview him in advance. Doe didn’t find out about the purpose of the meeting until just before it started, when RPI’s interviewers gave him some documents and told him he was the subject of misconduct investigation. If that weren’t enough to raise due process concerns, it was also “obvious” to Judge Raymond J. Elliott that there was “a language and a possible cultural barrier” between Doe and RPI’s interviewers. So RPI hauled Doe in for questioning without telling him why, sprung a serious charge on him, and failed to ensure that he understood what was going on.

[…]

But to say the court generally sided with Doe would be an understatement.

Most importantly, the court ruled that RPI went too far in asserting jurisdiction over Doe and subjecting him to its disciplinary process. The court held that RPI should not have interviewed him or included his statement in its report. The remedy in this case was voiding Doe’s statement, and because RPI relied on Doe’s statement, the court annulled the report. The court also found that RPI had “no legal authority or obligation … to report, inform, publish or share any information or documentation with [Doe’s] academic institution regarding this alleged incident, and that [RPI’s] determination that they have the authority to do so is arbitrary and capricious.”

October 31, 2017

Yes Minister — The Five Standard Excuses

Filed under: Britain, Bureaucracy, Government, Humour — Tags: , , — Nicholas @ 02:00

Hostis Humani Generis
Published on 26 Sep 2015

Humphrey Appleby’s five standard excuses from S02E07.

October 24, 2017

QotD: Tax complexity

Filed under: Bureaucracy, Government, Quotations, USA — Tags: , , — Nicholas @ 01:00

What’s interesting about this [IRS] scam is that it’s a departure from classic confidence schemes. Think about something like the Nigerian e-mail scams, and how they draw their victims in: greed for a lucrative finder’s fee in exchange for doing something that sounds maybe a little bit shady, but maybe sort of noble too. The victim is then strung along by playing to the greed, and kept from talking to others who might point out the scam by because they think they are complicit in something legally questionable.

The IRS scam, on the other hand, works entirely by fear. It takes people who haven’t done anything wrong, and makes them afraid that they have. That’s a pretty hefty achievement. Imagine trying to extort money from someone by, say, claiming that they had murdered someone. You might elicit laughter, or bewilderment, but you’d rarely elicit much cash.

Which raises the obvious question: How did we get into a situation where it’s so easy for people to believe that the IRS is about to arrest them for a crime they weren’t even aware of having committed?

You guessed it: The IRS is incredibly powerful, and the tax code is incredibly opaque.

Like many journalists, my husband and I pay someone to do our taxes. We have to. The year we married, I realized that with two journalists who both had salary and non-salary income, home offices, various business expenses, and a new home purchase, our taxes had finally passed the point at which I was even marginally competent to do them. Before then, I had always done my taxes myself, and filed them with a sort of wistful hope that I had done them correctly. At this point it seems worth pausing to note that:

  1. I have an MBA.
  2. I write about tax policy for a living.

These things are surprisingly little help. Filling out your taxes is not a matter of being good at math, or accounting, or even knowing how various provisions of the tax code interact in revenue projections. It is entirely a matter of knowing what can be deducted, and how. And because our tax code is so complex, that doesn’t mean “read the statute”; it means “read the statute, and the case law, and develop a sense over long experience of how agents are likely to interpret this or that during an audit.” The only people who can do that are tax professionals; the rest of us are too busy earning a living in our own professions.

There’s no perfect measure of tax complexity, but consider one quick-and-dirty metric: the number of lines on a typical tax form, and the length of the accompanying tax booklet. Quartz did just that a while back, and found that the complexity had been steadily increasing.

Legal complexity does not accumulate linearly; it accumulates exponentially. When you have one law on the books, and you add a second, the new law may (or may not) have some unexpected interaction with the old law. This would be one complexity point for regulators to manage. But with each new law, the number of potential interactions grows quickly, until it passes the ability of any layman to grasp it (and eventually, surpasses the professionals as well, which is why they’re increasingly specialized in narrow areas). We are long past that point with the tax code.

Megan McArdle, “Why We Fear the IRS”, Bloomberg View, 2016-01-04.

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