Quotulatiousness

January 31, 2018

“Bitcoin is, of course, a mania – a delusion of the sort that human societies are prone to”

Filed under: Business, Economics, Technology — Tags: , , , , — Nicholas @ 05:00

Tim Worstall looks at some historical manias and explains how even the maddest of them can yield long-term economic benefits (to society as a whole, if not to individual maniacs):

The UK’s railway mania, the tulip bubble, the dot com boom and other collective economic madness – such as bitcoin – might lose people a lot of money, but they often lay down important foundations

Bitcoin is, of course, a mania – a delusion of the sort that human societies are prone to. This is fighting talk from someone who declared in 2011 that bitcoin was all over. Being wrong is not interesting – it is rare things which are interesting, not common ones – but the psychology and economics here are important.

The classic text on this topic is Charles McKay’s Extraordinary popular delusions and the madness of crowds. Human societies are prone to manias which seem to defy any sense or reasonableness. Certainly markets can be so overcome, although the witch burnings show that it’s not purely an economic phenomenon.

The South Sea Bubble, Tulip mania, railway shares, the dotcom boom and now bitcoin are all part of that same psychological failing of not recognising that prices can and will fall as well as rise. That is the classical interpretation of the McKay book and observation, but modern studies take a more nuanced view.

South Sea and the Mississippi Company bubble were simply speculative frenzies, but the tulip story – while appearing very similar – can be read another way.

It is still true, for example, that a few sheds near Schipol, just outside Amsterdam, are the centre of the world’s trade in cut flowers – the result of that historical episode where a single tulip bulb became worth more than a year’s wages.

We can, and some do, take tourist trips to see the fields of those very tulips today. Modern researchers point out that the tulip was near unknown in Europe, the first examples only just having arrived from Turkey.

The art of cross-pollinating tulips to gain desirable characteristics was only just becoming generally known, and Europe was reaching a stage of wealth where the purely ornamental was becoming valuable.

Yes, the speculation in prices was ludicrous – although the weird stuff was in futures and options markets, not the physical trade, and the absurd prices never actually happened – but the end result of the frenzy was still that the tulip and flower market became and is centred in The Netherlands.

QotD: “Enhancing the user experience”

Filed under: Business, Media, Quotations, Technology — Tags: , , , — Nicholas @ 01:00

Once upon a time, computers weren’t all constantly connected to the intertubes. What we call “air-gapped” these days was the normal state of machines back in the desktop beige box days.

Back then, when you bought a program it came in a cardboard box on physical media. You would install it on your computer and it would work the same way from the day you installed it to the day you stopped using it. Nobody could rearrange the menus on WordPerfect or change the buttons in Secret Weapons of the Lufwaffe … Good times.

Nowadays, half the software you interact with doesn’t even reside on your PC. Further, there are whole departments at, say, Facebook or Blizzard or Google whose entire job is to “enhance the user experience”. If they’re not constantly dicking around, adding and removing features, changing what buttons do, moving things around … then they’re not doing their jobs.

We have incentivized instability.

Tamara Keel, “Tinkering for tinkering’s sake…”, View From The Porch, 2018-01-10.

January 30, 2018

QotD: Worstall’s Law of Organizations

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

I would, and do, argue that this is, in fact, the inevitable fate of all and any organizations, so much so that we might call it Worstall’s Law of Organizations, perhaps a minor corollary to Parkinson’s Laws. All and any organizations will in the end be run by those who stay awake in committee. A brief survey of the world around us will show that this is a simple and obvious truth.

Tim Worstall, “‘Any Organization Will, In the End, Be Run By Those Who Stay Awake in Committee'”, Ideas in Action, 2005-06-23.

January 28, 2018

The origins of the minimum wage

Filed under: Business, Economics, Government — Tags: , , , — Nicholas @ 03:00

In Ontario, many businesses are still struggling to cope with the provincial government’s mandated rise in the minimum wage (the Tim Horton’s franchisees being the current Emmanuel Goldsteins as far as organized labour is concerned). In this essay for the Foundation for Economic Education, Pierre-Guy Veer points out that most franchise businesses have very low profit margins (2.4% for McDonalds franchises, for example) meaning that they can’t just pay the higher wages without a problem, and that the original intent of minimum wage legislation in the US was actually to drive down employment for certain ethnic and racial groups:

Normally, wages are determined at the intersection of supply (employees offering their services, the blue line) and demand (employers wanting workers, the orange line), the letter E. Since working in retail or restaurants requires little more than a high school diploma, that equilibrium is much lower than, say, a heart surgeon, who must endure years of training and study.

But when governments come and impose a minimum wage (the dark line), wages do increase… at the expense of workers. With a base wage now at E’, more workers want to work but fewer employers want to hire because of the increased cost. The newly formed triangle is made of surplus workers, i.e. unemployed workers who can’t find a job. This unlucky Brian meme summarizes the situation of what minimum wage is: wage eugenics.

And don’t think it’s a vice; creating unemployment was the explicit goal of imposing a minimum wage. It was a Machiavellian scheme imagined during the so-called Progressive Era (late 19th Century to about the 1920s), where it was thought that governments could better humanity by “weeding out” undesirables – in other words, eugenics.

In the U.S., this eugenic attitude was explicitly aimed at African Americans, whose (generally) lower productivity gave them lower wages. To “fight” this problem nationwide, the Hoover administration passed, in 1931, the Davis-Bacon Act in order to impose “prevailing wage” (usually unionized) on all federal contracts. It was a thinly veiled attempt to “weed out” non-unionized workers, who were either African American or immigrant, in order to protect unionized, white jobs. Supporters of the bill, like Representative Clayton Algood, were very explicit in their racist intents:

    That contractor has cheap colored labor that he transports, and he puts them in cabins, and it is labor of that sort that is in competition with white labor throughout the country.

But while the racist intent of the minimum wage has disappeared, its effect is always very real. It greatly affects the people it wants to help, i.e. low-skilled workers, and leaves them with fewer options. So don’t be fooled by unemployment statistics from the Bureau of Labor Statistics. Youth participation rates (ages 16-19) are still hovering around all-time lows (affected, among others, by minimum wage laws); this means that fewer of them are looking for jobs, decreasing unemployment figures.

It gets worse when breaking down races; only 28.8 percent of African American youth were working or looking for a job, compared to 31.6 for Hispanics and 36.7 percent for whites in December 2017.

January 27, 2018

The difference between being “pro-free market” and “pro-business”

Filed under: Business, Government, Liberty — Tags: , , , , — Nicholas @ 05:00

It’s a distinction that really does make a difference, argues Jonah Goldberg:

One of the most difficult distinctions for people in general and politicians in particular to grasp is the difference between being pro-free market and pro-business.

There are many reasons for this confusion. For politicians, the key reason is that businesspeople are constituents and donors, while the free market is an abstraction. Also, because capitalists tend to lionize successful people, we assume they share our philosophical commitments. But it is a rare corporate titan who favors a free market if doing so is bad for his or her bottom line.

Adam Smith recognized this in his canonical 1776 work, The Wealth of Nations. “People of the same trade seldom meet together, even for merriment and diversion,” he wrote, without the conversation ending “in a conspiracy against the public, or in some contrivance to raise prices.”

This doesn’t mean that capitalists are evil; it means they’re human beings. Virtually every profession you can think of has a tendency to dig a moat around itself to protect its interests and defend against competition. A few years ago, the American Academy of Pediatrics came out against affordable health care for children. Retail chains like Walmart and CVS started opening in-store clinics to provide affordable basic health care like vaccinations. The pediatricians rightly saw this as a threat to their monopoly over kids’ medical care. Obviously, the pediatricians didn’t think they were villains; they simply found rationalizations for why everyone should keep paying them top dollar for stuff that could be done more cheaply.

Similarly, most teachers like kids, but that doesn’t stop teachers unions from doing everything they can to protect themselves from competition or accountability. Indeed, unions, by design, are conspiracies against the public to defend the wages and perks of their members. NIMBYism (Not in My Backyard) is another manifestation of this phenomenon.

[…]

Smith understood this too. After noting how people of the same trade conspire to raise prices, he added: “It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.”

What both Smith and the founders understood is that such conspiracies can only last with the help of government. As the economist Joseph Schumpeter argued, in a system of free competition, monopolies cannot long endure without government protection.

Burger King swings and misses in their first attempt at entering political discussions

Filed under: Business, Politics, Technology, USA — Tags: , , , — Nicholas @ 03:00

Tho Bishop explains why the second-rate burger business fails to convince:

For one, Burger King does not have a “Whopper neutrality” policy – and for good reason. If a family of five places a large order, while the next customer simply orders an ice cream cone, most Burger King employees will not refuse to serve up the dessert until after they fulfill the first order. The aim is to serve as many customers, as quickly as possible.

Similarly, a Whopper meal comes in various sizes – all with different prices – all so that customers have more flexibility based on having their food desires met. Imagine if a government regulator decided that since Americans have a right to have their thirst quenched – no matter its size – all fast food restaurants had to price all drink sizes the same? The result would be the prices for small drinks going up, while restaurants having to submit to occasional inspections by government agents to make sure no one was violating beverage neutrality laws. (This of course would still manage to not be the worst soda-related policy that’s been proposed.)

Additionally, Burger King certainly has the right to not prioritize delivering their customers food in a timely matter, just as customers have a right to avoid their services as a result. Whether or not the customers in the video were authentic or not, their reaction to the absurd fictional policy is how you’d expect someone to act. The video suggests that none of them would be excited about returning to Burger King if this had become actual franchise operating procedure. Once again, the market has its own ways of punishing bad actors.

Which is precisely why I will be avoiding Whoppers myself for the foreseeable future.

At Reason, Nick Gillespie comments on the video:

The joke in the video is that customers must pay $26 to get a Whopper “hyperfast.” If they go with the standard price, it takes forever. Because you know, Net Neutrality rules that were formalized in 2015 somehow magically altered the way internet service providers (ISPs) delivered data to their customers. Before 2015, the internet was a morass of shakedown artists who forced all of us to pay extra for this or that site. And now that Net Neutrality has been repealed, the ‘net has reverted to a Hobbesian world in which access is nasty, brutish, and metered.

Oh wait, in fact, the average speed and number of internet connections kept growing regardless of the regulatory regime. The FCC’s most recent Internet Access Services Report counted 104 million fixed internet connections, a new high. That number doesn’t count mobile or satellite connections. Eighty percent of census tracts had at three or more ISPs offering connections of 10 Mbps downstream and 1 Mbps upstream and another 17 percent had two ISPs doing the same (figure 4). So 97 percent of America can go elsewhere when it comes to basic internet connections that allow the sort of streaming, surfing, and gaming we want. Just as customers do with Burger King, we can say, “Screw it, I’m going to McDonald’s.” In 2016, 56 million residential connections offered at least 25 Mbps upstream speeds. That’s up from about 22 million in 2013 (figure 8). How did that progress happen before the 2015 open internet order?

Watching the responses by customers helps explain why Net Neutrality rules as mandated by the FCC under Tom Wheeler were unnecessary. After all, for all the hysteria kicked up around the need for such rules, proponents went begging for examples of ISPs throttlng traffic or blocking sites in systematic ways. ISPs don’t actually enjoy pure-monopoly conditions, but even if they did, customers would raise holy hell if they were treated as poorly as Burger King acts in this video.

January 26, 2018

British sex workers create a “National Ugly Mugs” database to avoid sketchy customers

Filed under: Britain, Business, Technology — Tags: , , , , , — Nicholas @ 03:00

At The Register, Iain Thomson reports on a study of professional sex workers in Britain:

A study into the effect of the internet on professional sex workers has shown the online world keeps them safer, happier in their job, and more able to weed out creepy customers.

Researchers at the universities of Leicester and Strathclyde in the UK interviewed 641 courtesans – with a roughly 80/20 per cent female to male split – and found [PDF] more than three quarters found using online channels to find and vet punters made them safer in their trade. Online forums also gave then a valuable tool in staying safe and countering loneliness or depression.

“Girls are very open because obviously we started talking about the safety from the very get-go,” Milena, 32, an independent escort providing BDSM services. “If you didn’t have that internet … everything would have been underground and everybody would be scared.”

[…]

“I’d say the worst bit of the job is constantly feeling like you’ve got to look over your shoulder,” said Jane, 40, a BDSM specialist. “Even though I’m working legally, I’m constantly worried.”

Sex workers in the UK have also set up a National Ugly Mugs database, whereby abusive punters are flagged up by their email addresses or social media handles, which 85 per cent of the respondents used. Sharing this information between themselves made is much less likely that the workers would come to harm.

Support groups for people in the business have been greatly enabled by the online world.

Prostitution is legal in the UK, but not in a brothel or via a pimp. Going online meant that 89 per cent of respondents used online communications to eliminate the need for a third party to manage their affairs, 82 per cent went online to make sure they weren’t breaking the law, and 78 per cent said it had improved the quality of their lives.

January 23, 2018

The unintended consequences of Ontario’s steep minimum wage hike

Filed under: Business, Cancon, Economics — Tags: , , , , , — Nicholas @ 05:00

Colby Cosh on the unpredictable outcomes of Ontario’s recent minimum wage increase:

In Thursday’s edition of this paper, Marni Soupcoff wrote an entertaining column about how Ontario’s fairly aggressive minimum wage increase had suddenly raised the costs of labour-intensive goods and services for consumers — the ones, that is, who don’t benefit themselves from a minimum wage increase. Child care, which is a very pure purchase of labour, is the example that is being exasperatedly discussed this week. The headline did not have “duh” in it, but that was the spirit of the thing.

Soupcoff pointed out that this not only could have been foreseen; an explicit warning of it was given in the pages of the Toronto Star, by the paper’s social justice reporter Laurie Monsebraaten. Our Financial Post section could perhaps easily be called the Social Injustice Gazette, but anyone at FP who got such an early jump on an economics story would be rightly pleased with himself.

Soupcoff’s major point was that the broad-sense law of supply and demand is not some plutocratic swindle devised by the Monopoly Man and his fatcat pals; even believers in “social justice” have to take it into account, as they take gravity into account when they are moving an old couch to a charity shop or sending cosmonauts into orbit. This is obviously right as far as it goes, but the words “supply and demand” are not enough, on their own, to predict the precise market response to a change in a price control — which is what the minimum wage is.

That, perhaps, is the true key point amidst all the various ideological struggles currently in progress over minimum wage levels, which are being yoinked upward in Alberta as well as in Ontario. A minimum wage is a price control. The minimum wage is not really so much a labour standard as it is the abolition of labour bargains that feature a nominal wage below the minimum. And price controls are a blunt instrument. Most economists, whatever their political orientation, instinctively resist them.

The incidence of a price control — the precise place upon which the economic burden of it falls — is not, in fact, foreseeable without other information. In the market for hired child care, for example, it could turn out, with time, that the real effect of increasing a minimum wage is that some parents drop out of the labour market and tend to their own children. It’s just not what one would actually predict, because the need for professional child care is something that a family tends to plan for well in advance, with a longer time horizon than any government’s. (Also, we haven’t invented dependable babysitting robots yet.)

Women, in particular, organize lives and careers around whether they expect their own labour force participation to be able to cover care expenses. Indeed, couples adjust family size for these expectations. We can even imagine circumstances in which a province’s extreme, credible commitment to a very high future minimum wage influenced birth rates.

January 18, 2018

Weird lawsuit filed against Waymo engineer

Filed under: Business, Law, USA — Tags: , , , — Nicholas @ 05:00

In The Register, Kieren McCarthy reports on the case:

The engineer at the center of a massive self-driving car lawsuit – brought by Google-stablemate Waymo against Uber – neglects his kids, is wildly disorganized, and has a large selection of bondage gear, his former nanny has sensationally alleged.

Anthony Levandowski may also be paying a Tesla techie for trade secrets, may have secretly helped set up several self-driving car startups, and at one point planned to flee across the border to Canada in an effort to avoid the legal repercussions of his actions at both Waymo and Uber, it is further claimed.

Those extraordinary allegations come in a highly unusual lawsuit [PDF] filed earlier this month by his ex-nanny Erika Wong, who worked for Waymo’s former star engineer for six months, from December 2016 to June 2017.

Wong’s lawsuit identifies no less than 41 causes of action – ranging from alleged health and safety code violations to emotional distress – and asks for a mind-bogglingly $6m in recompense. Levandowski’s lawyer said the lawsuit is a “work of fiction.”

Not safe for work bits below the fold:

(more…)

January 14, 2018

Google’s unhealthy political monoculture

Filed under: Business, Law, Technology, USA — Tags: , , , — Nicholas @ 03:00

Megan McArdle doesn’t think that the lawsuit that James Damore is pursuing against Google has a lot of legal merit, but despite that she’s confident that the outcome won’t be happy for the corporation:

The lawsuit, just filed in a California court, certainly offers evidence that things were uncomfortable for conservatives at Google. And especially, that they were uncomfortable for James Damore after he wrote a memo suggesting that before Google went all-out trying to achieve gender parity in its teams, it needed to be open to the possibility that the reason there were fewer women at the firm is that fewer women were interested in coding. (Or at least, in coding with the single-minded, nay, obsessive, fervor necessary to become an engineer at one of the top tech companies in the world.)

That much seems quite clear. But it’s less clear that Damore has a strong legal claim.

I understand why conservative employees were aggrieved. Internal communications cited in the lawsuit paint a picture of an unhealthy political monoculture in which many employees seem unable to handle any challenge to their political views. I personally would find it extremely unsettling to work in such a place, and I am a right-leaning libertarian who has spent most of my working life in an industry that skews left by about 90 percent.

But these internal communications have been stripped of context. Were they part of a larger conversation in which these comments seem more reasonable? What percentage did these constitute of internal communications about politics? At a huge company, there will be, at any given moment, some number of idiots suggesting things that are illegal, immoral or merely egregiously dumb. That doesn’t mean that those things were corporate policy, or even that they were particularly problematic for conservatives. When Google presents its side of the case, the abuses suggested by the lawsuit may turn out to be considerably less exciting — or a court may find that however unhappy conservatives were made by them, they do not rise to a legally actionable level.

Google, for its part, says that it is eager to defend the lawsuit. But lawyers always announce that they have a sterling case that is certain to prevail, even if they know they are doomed. And unless they can present strong evidence that there were legions of conservatives happily frolicking away on their internal message boards while enjoying the esteem of their colleagues and the adulation of their managers, there is no way that this suit ends well for Google. If the company and its lawyers think otherwise, they are guilty of a sin known to the media as “reading your own press releases,” and to drug policy experts as being “high on your own supply.”

There are expensive, time-consuming, exasperating lawsuits, and then there are radioactive lawsuits that poison everyone who comes within a mile of them. And this lawsuit almost certainly falls into the latter category.

January 13, 2018

Fast Food – Would You Like Capitalism With That? I THE COLD WAR

Filed under: Business, Economics, History — Tags: , , — Nicholas @ 02:00

IT’S HISTORY
Published on 8 Jul 2015

A city that is not plastered with branches of US Fast Food chains is a rare sight nowadays. That wasn’t always the case. Fast Food, as we know it today, is a child of the economic boom after World War 2. Taking your new car for a ride to the Drive-In restaurant and getting a fresh burger; that’s the American Dream right there. Ultimately the concept of identical taste and identical manufacturing steps is one thing: pure capitalism. Food chains keep wages and costs as low as possible and that is why Fast Food is not nearly as glamorous today as it once was. So put down that Hamburger and find out all about the history of Fast Food with Guy on IT’S HISTORY.

Big Mac Index: http://bit.ly/TheBIGMACIndex

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 11, 2018

Sell the sizzle works, for a while, but even names with “blockchain” still have to produce something

Filed under: Business, Technology — Tags: , — Nicholas @ 03:00

Remember the media splash — and stock price boost — that the Long Island Iced Tea Company got by rebranding themselves as Long Blockchain? The rest of the plan apparently isn’t playing out quite as the company may have hoped:

… today Long Blockchain announced it was scrapping the stock offering. The company says that it’s still planning to buy bitcoin-mining hardware. However, Long Blockchain says that it “can make no assurances that it will be able to finance the purchase of the mining equipment.”

Where the company might get the money to buy the mining equipment is unclear. Antminer S9 mining hardware lists for upwards of $5,000, so it would cost millions of dollars to get 1,000 units. Long Blockchain’s most recent financial disclosure shows the company with only $429,000 in cash on hand in September.

The company’s press release didn’t explain the sudden turnaround, but it seems the stock market wasn’t thrilled by the plan to sell new shares. Long Blockchain’s stock price fell on Friday, the day the plan was announced, then soared this morning when the plan was scrapped. The stock is still worth more than double its value before the blockchain pivot was announced last month.

The broader question is why it makes sense for a beverage company to get into the blockchain business in the first place. In principle, you could imagine the company looking for ways to use blockchains to improve its core business — by optimizing supply chain management, for example.

Maybe I should rethink my plan to rebrand as Quotulatiousness BLOCKCHAIN

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.

January 7, 2018

Give your butt a wake-up call with the latest from “Gwyneth Paltrow’s life-threatening, wallet-flensing empire of woo”

Filed under: Business, Health, Media, USA — Tags: , , , , — Nicholas @ 03:00

Cory Doctorow views with alarm yet another potentially dangerous product from Goop:

Goop is Gwyneth Paltrow’s life-threatening, wallet-flensing empire of woo, home to smoothie dust, vulva steaming, rocks you keep in your vagina, and a raft of rebadged products that are literally identical to the garbage Alex Jones sells to low-information preppers.

Both Goop and Alex Jones are big on “detoxing,” an imaginary remedy that poses a very real health-risk, especially when it involves filling your asshole with coffee.

Coffee enemas are, of course, bullshit, whose history and present are rife with hucksters whose smooth patter is only matched by their depraved indifference for human life.

But as stupid as coffee enemas are, they’re even stupider when accomplished by means of Goop’s, $135 “Implant O’Rama,” manufactured by Implant O’Rama LLC. It’s a $135 glass jar with a couple silicon hoses attached to it.

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