Quotulatiousness

September 3, 2020

Fallen Flag — The Great Northern Railway

Filed under: Business, Cancon, History, Railways, USA — Tags: , , , , , , , — Nicholas @ 05:00

This month’s Classic Trains featured fallen flag is an American railway that definitely deserved to call itself “great”, James J. Hill’s Great Northern Railway. Hill was noteworthy as the only “Robber Baron” of that era who was scrupulous in avoiding government entanglements (including grants, loans, subsidies, and other forms of money-with-political-strings-attached), building his entire railway system using private funds and rational profit-oriented economic decision-making (the other transcontinental lines often over-built to claim higher subsidies or added money-losing branch lines to please powerful politicians). The result was that when economic hard times hit the railway business, his was the only transcontinental that never needed to declare bankruptcy.

In an earlier post, Dane Stuhlsatz summarized the GN’s engineering:

Hill’s line […] was methodically surveyed and built, on the shortest routes possible, with the least gradient possible, and using the best steel and other materials on the market at the time. Rather than political largess, Hill made his decisions based on profit and loss. But, for all the efficiency that Hill built into his line — he was able to transport across the country faster, cheaper, and with less maintenance costs than could the UP and CP — arguably the most important aspect for the viability of his business was the freedom to conduct business untethered by the strings that accompanied government subsidies.

Route map of the Great Northern Railway, circa 1920. Red lines are Great Northern trackage; dotted lines are other railroads.
Map by Elkman via Wikimedia Commons.

George Drury outlines the origins of the railway:

In 1857, the Minnesota & Pacific Railroad was chartered to build a line from Stillwater, Minnesota, on the St. Croix River, through St. Paul and St. Cloud to St. Vincent, in the northwest corner of the state. The company defaulted after completing a roadbed between St. Paul and St. Cloud, Minnesota, and its charter was taken over by the St. Paul & Pacific Railroad, which ran its first train between St. Paul and St. Anthony (now Minneapolis) in 1862.

For financial reasons the railroads were reorganized as the First Division of the St. Paul & Pacific. Both StP&P companies were soon in receivership, and Northern Pacific, with which the StP&P was allied, went bankrupt in the Panic of 1873.

Canadian-born “Robber Baron” James J. Hill (1838-1916) in 1914.

In 1878 James J. Hill and an associate, George Stephen, acquired the two St. Paul & Pacific companies and reorganized them as the St. Paul, Minneapolis & Manitoba Railway (“the Manitoba”). By 1885 the company had 1,470 miles of railroad and extended west to Devils Lake, North Dakota. In 1886 Hill organized the Montana Central Railway to build from Great Falls, Montana, through Helena to Butte, and in 1888 the line was opened, creating in conjunction with the StPM&M a railroad from St. Paul to Butte.

In 1881 Hill took over the 1856 charter of the Minneapolis & St. Cloud Railroad. He first used its franchises to build the Eastern Railway of Minnesota from Hinckley, Minnesota, to Superior, Wisconsin, and Duluth. Its charter was liberal enough that he chose it as the vehicle for his line to the Pacific. He renamed the road the Great Northern Railway; it then leased the Manitoba and assumed its operation.

[…]

Even before completion of the route from St. Paul, the Great Northern opened a line along the shore of Puget Sound between Seattle and Vancouver, British Columbia, in 1891. In the years that followed, Hill pushed a number of lines north across the international boundary into the mining area of southern British Columbia in a running battle with Canadian Pacific. In 1912 GN traded its line along the Fraser River east of Vancouver to Canadian Northern for trackage rights into Winnipeg.

Great Northern gradually withdrew from British Columbia after Hill’s death. In 1909 the Manitoba Great Northern Railway purchased most of the property of the Midland Railway of Manitoba (lines from the U.S. border to Portage la Prairie and to Morden), leaving the Midland, which was jointly controlled by GN and NP, with terminal properties in Winnipeg. The Manitoba Great Northern disposed of its rail lines in 1927. They were later abandoned.

Postcard photo of the Great Northern Railway’s “Empire Builder” streamliner between Everett and Seattle, Washington, circa 1963.
Great Northern Railway postcard via Wikimedia Commons.

The Great Northern and Northern Pacific lines agreed to a merger in 1901 (both lines were controlled by Hill) but the plan was vetoed by the Interstate Commerce Commission. A second attempt in the 1920s after Hill’s death was again turned down by the regulator unless the combined company divested ownership of the Chicago, Burlington & Quincy which was both railways’ connection from Minneapolis to Chicago. It was only on the final attempt in 1970 that the deal gained the government’s grudging approval and the Great Northern, Northern Pacific, and CB&Q merged to form the Burlington Northern.

September 2, 2020

Trust – the limiting factor on Chinese tech firms’ growth

Filed under: Business, China, Government, India, Media, Technology, USA — Tags: , , , , — Nicholas @ 05:00

Henrik Tiemroth on the “glass ceiling” that Chinese technology companies are struggling with:

The rise of Chinese technology firms has been one of the major developments of the last decade. As some of those companies expand their operations overseas, some observers see China laying the groundwork for a broader imperial project, using their growing digital might to project power and influence. By 2030, will we all be sending messages on WeChat, searching on Baidu, and shopping on Alibaba?

Probably not. As China’s major tech firms attempt to expand to global markets, they are running into a glass ceiling of their government’s own making: people don’t trust them. The recent ban on ByteDance’s popular social media app TikTok in the United States demonstrates the extent – and the limits – of China’s digital ambitions.

TikTok was the first Chinese internet product to have a mass following in the United States. As of 2020, the app has 100 million active users in the US – about a third of the population. But the popular and seemingly innocuous app for making, viewing and sharing quippy homemade music videos has been declared a national security threat.

In August, President Trump signed an executive order effectively banning the app, along with WeChat, unless their US operations are taken over by a domestic company. Given the close links between Chinese companies like ByteDance and the government, they argue, the data collected on American users of the app could be used by the Chinese state for espionage or other nefarious purposes.

The Trump administration is not the first government to take this step. In July, India banned TikTok, along with 59 other Chinese apps, amid rising tensions with China. The government cited similar concerns about the potential for mining and misuse of private data. Indonesia temporarily banned the platform in 2018, and Japan is reportedly considering following the US’s lead.

Across the world, people are becoming warier of who uses their data and how. Lawmakers are perking up, as the implications of data for national security are becoming more clear. In 2018, the European Union implemented landmark data privacy laws. In the US, tech CEOs are regularly dragged before congressional committees and a bipartisan movement for regulation is building.

Chinese internet companies face those same concerns and then some. It’s one thing to have your personal data used to promote conspicuous consumption. It’s another entirely to have it weaponized by a sophisticated digital surveillance state at the cutting edge of data-driven totalitarianism.

August 30, 2020

QotD: Capitalism

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

It’s entirely possible to muse on whether the cut has to be different to contain the dab dabs or summat but that’s not what is going on at all. Women will pay more for their t-shirts therefore the capitalists, the bastards, charge women more for their t-shirts. Just because they can.

The women who significantly object to this are already buying men’s version and so the bastards get to market segment. Between those who care more about money than cut – they’re paying the same as the men – and those who care more about the cut than the money are paying more. If all women cared more about the money then they wouldn’t be able to do this.

It’s exactly the same reason that causes pink razors to cost more than blue. People will pay the extra so why the hell not try it on?

Yes, this really is insisting that its women’s own fault. If some significant portion didn’t pay the extra then no one would try to charge it.

Capitalism really is very simple.

Tim Worstall, “Why Do Women Pay More For T-Shirts? Because Women Will Pay More For T-Shirts”, Continental Telegraph, 2018-05-25.

August 29, 2020

Recreating British Railways?

Filed under: Britain, Business, Economics, Government, Railways — Tags: , , , , — Nicholas @ 05:00

Adrian Quine looks at the long-term results of the partial privatization of British Railways, and the current British government’s options to address some of the problems:

Wikimedia caption – “This is the Bring Back British Rail, a reverse image of the old BR logo, (now used by the TOC’s) to show we are heading the wrong way with Rail in the UK”

If there is one thing free marketeers and large state socialists agree on, it would be the terrible state/private hybrid ownership structure of our railways currently supported by the government. While large state socialists won’t be happy until the private sector is squeezed out of the system, market liberals view the Conservative government’s actions as creeping renationalisation.

The private-sector entrepreneurs that built many of Britain’s railways in the 19th century had – through a process of market discovery – settled on vertical integration, with the same firm owning the track and operating the trains. But, when railways were returned to private sector in the late 1990s, the government created one national infrastructure company (Railtrack), 25 train-operating companies (TOCs), 3 freight operating companies, 3 rolling-stock leasing companies, 13 infrastructure service companies and other support organisations. The Office of Passenger Rail Franchising was tasked with selling franchises to the TOCs, while the Office of the Rail Regulator (ORR) regulated the infrastructure. This artificial and fragmented structure was designed to give the impression of competition.

Despite these constraints, in the early days of John Major’s flawed privatisation some of the more enterprising private train operators managed to bring innovation to the sector, including improved marketing and very low-cost “yield managed” advance fares. Where allowed, competition between different operators brought improved customer service, additional direct trains and lower ticket prices. However, the flaws in the initial privatisation soon became apparent with failed franchises leading to increased government intervention and renationalisation by subsequent governments.

While attempts were made to downplay the significance of July’s decision by the Office of National Statistics to put train operators on the public balance sheet, it is in fact only the latest in a worrying string of signals about the direction in which the railway and Boris Johnson’s government are headed. In June, the transport secretary Grant Shapps announced to a parliamentary select committee plans to introduce concessions across the rail network. Private operators will simply be paid a set fee to provide a basic service – another nail in the coffin for commercial investment or innovation.

Attention is now turning to what the government will do when the current “Emergency Measures Agreements” – hastily put in place to ensure trains kept running when passenger numbers nosedived by 95% as lockdown began – comes to an end in September.

An InterCity 125 power car in British Rail livery at Manchester Piccadilly in October 1976.
Photo by Dave Hitchborne via Wikimedia Commons.

August 28, 2020

National “cheater density” for popular online games

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

Richard Currie summarizes the findings of Ruby Fortune’s cheater research (note that there’s no data on China because reasons):

Ever torn your keyboard from the desk and flung it across the room, vowing to find the “scrub cheater” who ended your run of video-gaming success? Uh, yeah, us neither, but a study into the crooked practice might help narrow down the hypothetical search.

The research, carried out by casino games outfit Ruby Fortune, has produced a global heatmap of supposed cheater density.

According to the website, this was done by analysing “search trend and search volume data to reveal where in the world is most likely to cheat while playing online multiplayer video games”. The report looks at the frequency of search engine queries for the most-played video games and measures them against searches for related cheat codes, hacks and bots, to show which country has the highest density of cheaters, and which cheat categories are the most popular in each location.

[…]

There is a massive hole in the data, however, thanks to the Great Firewall of China, which has a terrible reputation for ruining the experience of online games.

If there was any doubt that the Middle Kingdom would otherwise take Brazil’s crown, consider that Dell once advertised a laptop for the market by saying it was especially good for running PUBG plugins to “win more at Chicken Dinner”, a reference to the “Winner winner chicken dinner” message that comes up on a victory screen.

Data from the Battle Royale granddad’s anti-cheat tech provider, BattlEye, has also suggested that at one point 99 per cent of banned cheaters were from China.

August 27, 2020

QotD: Racism and the minimum wage

Filed under: Australia, Business, Cancon, Economics, Quotations, USA — Tags: , , , , , , — Nicholas @ 01:00

Minimum-wage laws can even affect the level of racial discrimination. In an earlier era, when racial discrimination was both legally and socially accepted, minimum-wage laws were often used openly to price minorities out of the job market.

In 1925, a minimum-wage law was passed in the Canadian province of British Columbia, with the intent and effect of pricing Japanese immigrants out of jobs in the lumbering industry.

A Harvard professor of that era referred approvingly to Australia’s minimum wage law as a means to “protect the white Australian’s standard of living from the invidious competition of the colored races, particularly of the Chinese” who were willing to work for less.

In South Africa during the era of apartheid, white labor unions urged that a minimum-wage law be applied to all races, to keep black workers from taking jobs away from white unionized workers by working for less than the union pay scale.

Some supporters of the first federal minimum-wage law in the United States — the Davis-Bacon Act of 1931 — used exactly the same rationale, citing the fact that Southern construction companies, using non-union black workers, were able to come north and underbid construction companies using unionized white labor.

These supporters of minimum-wage laws understood long ago something that today’s supporters of such laws seem not to have bothered to think through. People whose wages are raised by law do not necessarily benefit, because they are often less likely to be hired at the imposed minimum-wage rate.

Thomas Sowell, “Why racists love the minimum wage laws”, New York Post, 2013-09-17.

August 25, 2020

Berlin’s experiment with rent control has already made huge changes in the housing market

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

Sadly, for advocates of rent control in other cities, the changes are not positive for renters or landlords:

In the beginning of this year, the city government of Berlin brought in a rent freeze, a particularly crude form of rent control. Predictably, this led to calls from certain quarters for introducing similar measures here in London. I had several discussions about this, making the standard economic case against rent controls, but to no avail. I was told that I was blinded by neoliberal dogma, that the world is not as simple as my Econ 101 textbook, and that this was a brilliant and necessary measure to rein in the power of greedy landlords and speculators.

The first results are already in now, and they can be interpreted as the revenge of Econ 101. In Berlin, the supply of new rental properties coming on the market has fallen by a quarter compared to last year. No, this is not because of the virus: in other big cities such as Hamburg, Munich and Cologne, supply has increased by a third over the same period.

In fact, the one subsector of Berlin’s rental market which is exempt from the rent cap, namely new-built properties, is not that different from the rental markets of other big cities. In this subsector, the number of new rental properties coming on the market has increased by a quarter. Yet in the main market, where the cap does apply, supply has fallen by almost half – a drastic reduction, which more than cancels out any gains made elsewhere.

There has also been an increase in the number of properties that are up for sale, rather than rent, because while rents have been capped, sales prices have not.

So whether you compare the rent-capped part of Berlin’s rental property market to its counterpart in other cities, to its cap-exempt counterpart in Berlin itself, or to the owner-occupier sector – the result is always the same. The rent cap clearly is having a negative impact on supply, and this is happening astonishingly quickly: even I was not expecting to see any impact in this year, or the next.

None of the arguments against rent controls are new. You can already find them all in Verdict on Rent Control, a book which the IEA published in 1972. The book is actually a collection of papers on the subject, some of which are much older than that. It contains one paper by Milton Friedman and George Stigler on wartime rent controls in the US, which were still lingering after the war had ended. It was first published in 1946, but they were already having the same arguments then that we are still having today.

How we used to “dine out” (and someday might be able to again)

Filed under: Books, Britain, Business, Europe, Food, France, History — Tags: , , , , , — Nicholas @ 03:00

In The Critic, Alexander Larman reviews The Restaurant: A history of eating out by William Sitwell:

The recent enforced lockdown closure was a potential death blow to the entire [restaurant] industry. Which makes William Sitwell’s luxurious book both a celebration and an unintentional requiem for what may be a bygone time.

His central thesis is clear: the history of dining out is also a social history of evolving cultures and tastes. This means that the subjects he writes about range from ancient Pompeii to the growth of the sushi conveyor belt restaurant, encompassing everything from medieval taverns and the French Revolution to the rise of Anglo-Indian cuisine.

It is a broad and impressive spectrum, but perhaps Sitwell has, like some of the less fortunate people he describes, bitten off more than he can chew. His opening chapter about Pompeii is rich in surprising detail (graffiti uncovered outside one tavern when it was excavated ranged from the poetic — “Lovers are like bees in that they lead a honeyed life” — to the crude — “I screwed the barmaid”) and an insightful evocation of the dining culture in Ancient Rome.

He is then, unfortunately, faced with the insurmountable difficulty that the restaurant, as we know it today, did not exist until the late eighteenth century, meaning that his definition of “eating out” has to do some extremely heavy lifting.

There is as much padding in the early chapters as there is around some of his subjects’ waistlines. Much of what he writes is very interesting and often amusing, such as the way in which coffee, first drunk in London around the time of the Restoration, became associated both with health-giving properties and reportedly making men impotent, withered “cock-sparrows”. Yet there are also lengthy sections that have little or nothing to do with restaurants, such as a potted history of the Industrial Revolution.

Nevertheless, when Sitwell finally gets into his stride and begins to write about eateries proper, his authority and enthusiasm are palpable. He describes the dawn of fine dining in Paris in the nineteenth century evocatively. London lagged behind, although gentlemen’s clubs such as the Athenaeum and Reform offered some delights for the wealthy thanks to chefs (French, naturally) such as Alexis Soyer who implemented what one biographer called “the most famous and influential working kitchen in Europe” in 1841, complete with gas-fired stoves, butcher’s rooms and a fireplace devoted to the roasting of game and poultry.

August 22, 2020

John Cabot’s patent monopoly grant and the rise of the modern corporation

Filed under: Britain, Business, Government, History, Law — Tags: , , , , — Nicholas @ 03:00

In the latest Age of Invention newsletter, Anton Howes traces the line of descent of modern corporate structures from the patent granted to John Cabot to explore (and exploit) a trade route to China:

The replica of John Cabot’s ship Matthew in Bristol harbour, adjacent to the SS Great Britain.
Photo by Chris McKenna via Wikimedia Commons.

I discussed last time [linked here] how the use of patent monopolies came to England in the sixteenth century. Since then, however, I’ve developed a strong hunch that the introduction of patent monopolies may also have played a crucial role in the birth of the business corporation. I happened to be reading Ron Harris’s new book, Going the Distance, in which he stresses the unprecedented constitutions of the Dutch and English East India Companies — both of which began to emerge in the closing years of the sixteenth century. Yet the first joint-stock corporation, albeit experimental, was actually founded decades earlier, in the 1550s. Harris mentions it as a sort of obscure precursor, and it wasn’t terribly successful, but it stood out to me because its founder and first governor was also one of the key introducers of patent monopolies to England: the explorer Sebastian Cabot.

As I mentioned last time, Cabot was named on one of England’s very first patents for invention — though we’d now say it was for “discovery” — in 1496. An Italian who spent much of his career serving Spain, he was coaxed back to England in the late 1540s to pursue new voyages of exploration. Indeed, he reappeared in England at the exact time that patent monopolies for invention began to re-emerge, after a hiatus of about half a century. In 1550, Cabot obtained a certified copy of his original 1496 patent and within a couple of years English policymakers began regularly granting other patents for invention. It started as just a trickle, with one 1552 patent granted to to some enterprising merchant for introducing Norman glass-making techniques, and a 1554 patent to the German alchemist Burchard Kranich, and in the 1560s had developed into a steady stream.

Yet Cabot’s re-certification of his patent is never included in this narrative. It’s a scarcely-noted detail, perhaps because he appears not to have exploited it. Or did he? I think the fact of his re-certification — a bit of trivia that’s usually overlooked — helps explain the origins of the world’s first joint-stock corporation.

Corporations themselves, of course, were nothing new. Corporate organisations had existed for centuries in England, and indeed throughout Europe and the rest of the world: officially-recognised legal “persons” that might outlive each and any member, and which might act as a unit in terms of buying, selling, owning, and contracting. Cities, guilds, charities, universities, and various religious organisations were usually corporations. But they were not joint-stock business corporations, in the sense of their members purchasing shares and delegating commercial decision-making to a centralised management to conduct trade on their behalves. Instead, the vast majority of trade and industry was conducted by partnerships of individuals who pooled their capital without forming any legally distinct corporation. Shares might be bought in a physical ship, or even in particular trading voyages, but not in a legal entity that was both ongoing and intangible. There were many joint-stock associations, but they were not corporations.

And to the extent that some corporations in England were related to trade, such as the Company of Merchant Adventurers of London, or the Company of Merchants of the Staple, they were not joint-stock businesses at all. They were instead regulatory bodies. These corporations were granted monopolies over the trade with certain areas, or in certain commodities, to which their members then bought licenses to trade on their own account. Membership fees went towards supporting regulatory or charitable functions — resolving disputes between members, perhaps supporting members who had fallen on hard times, and representing the interests of members as a lobby group both at home and abroad — but not towards pooling capital for commercial ventures. The regulated companies were thus more akin to guilds, or to modern trade unions or professional associations, rather than firms. Members were not shareholders, but licensees who used their own capital and were subject to their own profits and losses.

Before the 1550s, then, there had been plenty of unincorporated business associations that were joint-stock, and even more unincorporated associations that were not joint-stock. There had also been a few trade-related corporations that were not joint-stock. Sebastian Cabot’s innovation was thus to fill the last quadrant of that matrix: he created a corporation that would be joint-stock, in which a wide range of shareholders could invest, entrusting their capital to managers who would conduct repeated voyages of exploration and trade on their behalves.

August 20, 2020

QotD: Manipulating minimum wage laws to harm your competitors

Filed under: Business, Economics, Government — Tags: , , , , — Nicholas @ 01:00

I would be very surprised if careful research of the history of this Oregon statute did not reveal a producer group — or producer groups — who benefitted materially from the minimum-wage-induced stifling of competition.

The logic of such rent-creating legislation is plain: producer group A competes for many of the same customers against producer group B. Producer group A, however, uses for its production a mix of inputs (most importantly, capital and labor) that differs from the mix used by producer group B. Also, producer group B might compete most effectively against producer group A not by producing outputs as nearly identical as possible to that of A but, instead, by producing “substitute” goods or services that sell at prices lower than those charged by producer group A.

For example, producer group A might consist of locally owned restaurants with tablecloths and serving food freshly prepared by skilled chefs, while producer group B consists of chain restaurants serving food less exquisite but priced much lower. Members of producer group A are upset that producer group B is competing successfully for some diners who would likely otherwise eat more frequently at the restaurants of producer group A. What are the members of producer group A to do?

They could accept the fact that competition is not tortious — indeed, that economic competition is healthy for the economy at large — and do nothing other than compete harder to win more consumer patronage. That’d be the honest and honorable path to take. But government is in the picture, standing ready to escort those with little interest in honesty and honor down the rent-seeking path.

“So just pass legislation outlawing chain restaurants in our state,” suggests the leader of producer group A.

“Wish I could,” responds Sen. Slimey, “but that’s too blatant. Plus, it might not pass muster with the courts. But I’ve got an alternative plan that’s just as good.”

“Do tell!” exclaims the leader of producer group A.

“Well, I understand,” replies Sen. Slimey, “that the restaurants run by producer group B use many more low-skilled workers in their kitchens than your restaurants use.”

“That’s correct. We serve only fine food, so we hire experienced, high-skilled chefs, whose market wages are high.”

“So,” observes Sen. Slimey, “let’s enact a statute that raises the minimum wage above the average wage now paid to the average worker in producer group B’s restaurants, but lower than the average wage paid to workers in your — producer group A’s — restaurants.”

“Brilliant!” declares the leader of producer group A, who sees immediately that, while the minimum-wage legislation will on its face — de jure — apply to all restaurants, it will in fact have a differentially harsh effect on the restaurants in producer group B. The minimum wage will artificially raise producer group B’s costs of operation, causing them to reduce their outputs. One consequence of producer group B’s reduced outputs will be artificially increased demand for meals served at producer group A’s restaurants.

Sen. Slimey smiles, knowing that the news media, as well as most of the intellectuals in town, will applaud him for his apparent humanity and “Progressive” values. It’s a win-win for Sen. Slimey and for members of producer group A. And too few people will pay close-enough attention to the members, workers, and customers of producer group B to suspect that Sen. Slimey is anything other than a socially conscious public servant.

Don Boudreaux, “Doing Bad By Pretending to Do Good”, Café Hayek, 2018-05-13.

August 19, 2020

He calls it “unintended consequences”. I disagree … these consequences are very much intended

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

Brad Polumbo is being far too generous to Californian politicians by saying the impending collapse of the state’s entire gig economy was not the intended result of passing “worker protection” laws that penalized success:

UBER 4U by afagen is licensed under CC BY-NC-SA 2.0

This Friday, Uber and Lyft are set to entirely shut down ride-sharing operations in California. The businesses’ exit from the Golden State will leave hundreds of thousands of drivers unemployed and millions of Californians chasing an expensive cab. Sadly, this was preventable.

Here’s how we got to this point.

In September of 2019, the California state legislature passed AB 5, a now-infamous bill harshly restricting independent contracting and freelancing across many industries. By requiring ride-sharing apps such as Uber and Lyft to reclassify their drivers as full employees, the law mandated that the companies provide healthcare and benefits to all the drivers in their system and pay additional taxes.

Legislators didn’t realize the drastic implications their legislation would have; they were simply hoping to improve working conditions in the gig economy. The unintended consequences may end up destroying it instead.

Here’s why.

AB 5 went into effect in January, and now, a judge has ordered Uber and Lyft to comply with the regulation and make the drastic transformation by August 20. Since compliance is simply unaffordable, the companies are going to have to shut down operations in California.

Their entire business model was based upon independent contracting, so providing full employee benefits is prohibitively expensive. Neither Uber nor Lyft actually make a profit, and converting their workforce to full-time employees would cost approximately $3,625 per driver in California. As reported by Quartz, “that’s enough to boost Uber’s annual operating loss by more than $500 million and Lyft’s by $290 million.”

Essentially, California legislators put these companies in an impossible position. It makes perfect sense that they’d leave the state in response. It’s clear that despite the good intentions behind the ride-sharing regulation, this outcome will leave all Californians worse off.

August 12, 2020

CGP Grey was WRONG

Filed under: Business, History, Humour, Media, Military, USA — Tags: , , , — Nicholas @ 04:00

CGP Grey
Published 11 Aug 2020

‣ What Was TEKOI? (original version): https://www.youtube.com/watch?v=PCeMC…
‣ What Was TEKOI? (corrected version): https://www.youtube.com/watch?v=PCeMCwxayp0
‣ TEKOI Commentary: https://www.youtube.com/watch?v=ufsYK…
## Crowdfunders

Bob Kunz, John Buchan, Nevin Spoljaric, Donal Botkin, BN-12, Chris Chapin, Richard Jenkins, Phil Gardner, Martin, Steven Grimm, سليمان العقل, David F Watson, Colin Millions, Saki Comandao, Ben Schwab, Jason Lewandowski, Marco Arment, Shantanu Raj, rictic, emptymachine, George Lin, Henry Ng, Thunda Plum, Awoo, David Tyler, Fuesu, iulus, Jordan Earls, Joshua Jamison, Nick Fish, Nick Gibson, Tyler Bryant, Zach Whittle, Oliver Steele, Kermit Norlund, Kevin Costello, Derek Bonner, Derek Jackson, Mikko , Orbit_Junkie, Ron Bowes, Tómas Árni Jónasson, Bryan McLemore, Alex Simonides, Felix Weis, Melvin Sowah, Christopher Mutchler, Giulio Bontadini, Paul Alom, Ryan Tripicchio, Scot Melville, Bear, chrysilis, David Palomares, Emil, Erik Parasiuk, Esteban Santana Santana, Freddi Hørlyck, John Rogers, Leon, Peter Lomax, Rhys Parry, ShiroiYami, Tristan Watts-Willis, Veronica Peshterianu, Dag Viggo Lokøen, John Lee, Maxime Zielony, Julien Dubois, Elizabeth Keathley, Nicholas Welna

## Music

David Rees: http://www.davidreesmusic.com

QotD: The circle of recycled life

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

1. Somewhere in this great land, a concerned and responsible corporation is having their twice-weekly colorful and compelling advertising supplement printed on 100% recycled paper.

2. As soon as they are completed millions of these colorful and compelling 100% recyclable advertising supplements are shipped by truck to the various regional receiving centers of the U.S. Post Office.

3. From those centers, any number of allocated pallets of these colorful and compelling 100% recyclable advertising supplements are broken out, put on U.S. Post Office trucks and delivered to local postal carrier destinations inside northern California.

4. My personal Paradise postal carrier and hundreds of others report for work at local postal carrier centers throughout northern California and load up their vans with enough of these colorful and compelling 100% recyclable advertising supplements to deliver one or more to each and every house on their route.

5. My very polite personal Paradise postal carrier parks her van at the end of my block and loads her sack with these colorful and compelling 100% recyclable advertising supplements.

6. She comes up my walk, up the porch stairs, and deposits my full share of these colorful and compelling 100% recyclable advertising supplements into my mailbox with a clang every day between one and three in the afternoon.

7. Hearing the clang I sigh and wend my weary way to the front door and open my mailbox and pluck out said colorful and compelling 100% recyclable advertising supplements.

8. With a heavier sigh I go back in, trudge through my house, out my back door to the alley, and place the colorful and compelling 100% recyclable advertising supplements into my Recycling bin with the rest of the week’s mound.

9. Tomorrow the huge, lumbering Paradise Waste Management Recycling garbage truck will stop and empty my Recycling bin into its maw and haul all the colorful and compelling 100% recyclable advertising supplements off to the Chico California Recycling and Brand New Mountain of Garbage center.

10. The collected colorful and compelling 100% recyclable advertising supplements will then be shipped, by truck, to the center for turning recyclable paper into … recycled paper which will then be used by a concerned and responsible corporation for their twice-weekly colorful and compelling advertising supplements printed on 100% recycled paper.

Wash. Rinse. Repeat. Next year, as sure as spring brings septic system failures to Paradise, postage will increase because the U.S. Postal Colorful and compelling 100% recyclable advertising supplements “Service” will need more money to keep The Recycled Circle of life going.

Gerard VanderLeun, “The Circle of Recycled Life”, American Digest, 2018-06-01.

August 9, 2020

Canadian Art magazine’s “woke suicide pact”

Filed under: Bureaucracy, Business, Cancon, Media, Politics — Tags: , , , , , , , , — Nicholas @ 03:00

As a cultural barbarian and all-around Neanderthal, it will come as little surprise to both my readers that I’d never even heard of Canadian Art magazine. As a result, the recent decision to cease publication due to the unresolved (and almost certainly unresolvable) issues of needing to be funded by rich white people:

These evils were explained in a long article published by Canadian Art‘s former editor-in-chief, David Balzer (self-described “gay, fag, queer. Ambivalent Libra“), in which he complains that the progressive agenda of the magazine he edited was forever being undercut by the need to solicit funds from wealthy white donors. Or, as he describes it, the pursuit of: “white, liberal money — the champagne socialists.”

Shockingly, these donors are not especially fond an incessant slew of articles with titles such as Drop the Charges and Defund the Police, Says New Artists’ Letter for Black Lives, Give Us Permanence — Ending Anti-Black Racism in Canada’s Art Institutions, and A Crisis of Whiteness in Canada’s Art Museums.

Balzer’s analysis of the growing tension between establishment donor and do-good editor is spot on:

    Most boards, which are also majority white, are [interested] in going to where they believe the money is. So the argument goes: It takes a certain talent, panache, to be president, director, or CEO, to open those pocketbooks, and without these skills, culture cannot run. This argument implies that culture cannot run if its backrooms are not white … Many corporate partners make possible the lavish, yearly fundraising galas that cultural organizations host: ostentatious displays of whiteness and wealth that are the public-facing versions of the aforementioned work done by white presidents, directors and CEOs.

It’s a problem that every charity, art outlet, and activist organization in Canada will face. Supporting the arts is rarely an act of pure altruism. It has always been a status flex by the well-connected barons and baronesses of privilege. At its most cynical, arts funding is a high-class game of reputation laundering.

August 8, 2020

Andrew Sullivan – “[T]he Kendi test: does the staff reflect the demographics of New York City as a whole?”

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

In his latest Weekly Dish, Andrew Sullivan looks at an earnest diversity initiative of The Newspaper Guild of New York:

I’m naming this after Ibram X. Kendi because his core contribution to the current debate on race is the notion that “any measure that produces or sustains racial inequity between racial groups” is racist. Intent is irrelevant. I don’t think many sane people believe A.G. Sulzberger or Dean Baquet are closet bigots. But systemic racism, according to Kendi, exists in any institution if there is simply any outcome that isn’t directly reflective of the relevant racial demographics of the surrounding area.

The appeal of this argument is its simplicity. You can tell if a place is enabling systemic racism merely by counting the people of color in it; and you can tell if a place isn’t by the same rubric. The drawback, of course, is that the world isn’t nearly as simple. Take the actual demographics of New York City. On some measures, the NYT is already a mirror of NYC. Its staff is basically 50 – 50 on sex (with women a slight majority of all staff on the business side, and slight minority in editorial). And it’s 15 percent Asian on the business side, 10 percent in editorial, compared with 13.9 percent of NYC’s population.

But its black percentage of staff — 10 percent in business, 9 percent in editorial — needs more than doubling to reflect demographics. Its Hispanic/Latino staff amount to only 8 percent in business and 5 percent in editorial, compared with 29 percent of New York City’s demographics, the worst discrepancy for any group. NYT’s Newsroom Fellowship, bringing in the very next generation, is 80 percent female, 60 percent people of color (including Asians), and, so far as I can tell, one lone white man. And it’s why NYT‘s new hires are 43 percent people of color, a definition that includes Asian-Americans.

But notice how this new goal obviously doesn’t reflect New York City’s demographics in many other ways. It draws overwhelmingly from the college educated, who account for only 37 percent of New Yorkers, leaving more than 60 percent of the city completed unreflected in the staffing. It cannot include the nearly 19 percent of New Yorkers in poverty, because a NYT salary would end that. It would also have to restrict itself to the literate, and, according to Literacy New York, 25 percent of people in Manhattan “lack basic prose literary skills” along with 37 percent in Brooklyn and 41 percent in the Bronx. And obviously, it cannot reflect the 14 percent of New Yorkers who are of retirement age, or the 21 percent who have yet to reach 18. For that matter, I have no idea what the median age of a NYT employee is — but I bet it isn’t the same as all of New York City.

Around 10 percent of staffers would have to be Republicans (and if the paper of record nationally were to reflect the country as a whole, and not just NYC, around 40 percent would have to be). Some 6 percent of the newsroom would also have to be Haredi or Orthodox Jews — a community you rarely hear about in diversity debates, but one horribly hit by a hate crime surge. 48 percent of NYT employees would have to agree that religion is “very important” in their lives; and 33 percent would be Catholic. And the logic of these demographic quotas is that if a group begins to exceed its quota — say Jews, 13 percent — a Jewish journalist would have to retire for any new one to be hired. Taking this proposal seriously, then, really does require explicit use of race in hiring, which is illegal, which is why the News Guild tweet and memo might end up causing some trouble if the policy is enforced.

And all this leaves the category of “white” completely without nuance. We have no idea whether “white” people are Irish or Italian or Russian or Polish or Canadians in origin. Similarly, we do not know if “black” means African immigrants, or native black New Yorkers, or people from the Caribbean. 37 percent of New Yorkers are foreign-born. How does the Guild propose to mirror that? Ditto where staffers live in NYC. How many are from Staten Island, for example, or the Bronx, two places of extremely different ethnic populations? These categories, in other words, are incredibly crude if the goal really is to reflect the actual demographics of New York City. But it isn’t, of course.

My point is that any attempt to make a specific institution entirely representative of the demographics of its location will founder on the sheer complexity of America’s demographic story and the nature of the institution itself. Journalism, for example, is not a profession sought by most people; it’s self-selecting for curious, trouble-making, querulous assholes who enjoy engaging with others and tracking down the truth (at least it used to be). There’s no reason this skillset or attitude will be spread evenly across populations. It seems, for example, that disproportionate numbers of Jews are drawn to it, from a culture of high literacy, intellectualism, and social activism. So why on earth shouldn’t they be over-represented?

And that’s true of other institutions too: are we to police Broadway to make sure that gays constitute only 4 percent of the employees? Or, say, nursing, to ensure that the sex balance is 50-50? Or a construction company for gender parity? Or a bike messenger company’s staff to be reflective of the age demographics of the city? Just take publishing — an industry not far off what the New York Times does. 74 percent of its employees are women. Should there be a hiring freeze until the men catch up?

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