Quotulatiousness

April 11, 2019

What happens if you block access to all of Google’s IP addresses?

Filed under: Business, Technology — Tags: , , — Nicholas @ 04:00

The answer is … not a lot, or at least not quickly. So many companies use Google’s services in the background that even if you can get a particular site to work for you, it’ll very likely be as slow as a mid-90’s dial-up connection. Stephen Green reports on someone’s live experiment with a Google-less internet:

Behind the scenes, [Gizmodo’s Kashmir] Hill’s specialty VPN blocked her devices from trying to ping Google’s servers more than 15,000 times — in just the first few hours. After a week, it had stopped more than 100,000 attempts to share data with Google. And to repeat, this is after Hill had stopped using any of Google’s apps or services. The company has its tendrils all throughout the internet.

As Hill describes the process in her report to Gizmodo:

    I migrate my browser bookmarks over to Firefox (made by Mozilla).

    I change the default search engine on Firefox and my iPhone from Google — a privilege for which Google reportedly pays Apple up to $9 billion per year — to privacy-respecting DuckDuckGo, a search engine that also makes money off ads but doesn’t keep track of users’ searches.

    I download Apple Maps and the Mapquest app to my phone…

    I switch to Apple’s calendar app.

    I create new email addresses on Protonmail and Riseup.net (for work and personal email, respectively) and direct people to them via autoreplies in Gmail.

Hill did literally everything an internet-connected human being can do to disconnect themselves from Google. But you don’t have to be a Google customer in order to have the company garner 100,000 little bits of data about you every single week. Or as Hill herself says, “Google, like Amazon, is woven deeply into the infrastructure of online services and other companies’ offerings, which is frustrating to all the connected devices in my house.”

The fact is, you aren’t Google’s customer: You and your data are Google’s product, served up on an electronic platter to advertisers and God-Only-Knows-Who-Else… even if, like me, you’ve boycotted all of the company’s little data-sniffing products.

As a libertarian, I have philosophical issues with the whole idea of antitrust. But when a company grows so big and so pervasive that you can’t avoid becoming its tool — even when going to the extreme lengths Hill went through — then I can draw only one conclusion, expressed in three words.

Break. Them. Up.

April 8, 2019

Comparing the economic performance of China’s private versus state-owned companies

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

If you’ve been following the blog for a while, you’ll know that I’ve long been skeptical of any official economic statistics coming out of China. The reasons for my skepticism are that vast areas of the Chinese economy were owned or controlled by the state and reporting from those entities was performed through layers of officials whose positions and personal well-being depended on those reports being as positive as possible. In a capitalist system, announcing false production or profit figures will eventually be detected (sometimes not as soon as we’d like), and the company loses the trust of customers, suppliers, and banks, making survival much more difficult. In a state-owned organization, everyone in the hierarchy has a vested interest in false information not being uncovered or reported. In a private firm, you could lose your job … in a state-run enterprise, you could be shot or sent to a “re-education camp” along with all your family. The incentive to lie is much stronger when your risks are that high.

Tim Worstall comments on a recent report that compares the performance over time of Chinese private companies, privatized state companies, and companies that are still state-run:

That China has relaxed the governmental grip upon industry in recent decades is true. That China has become very much richer in recent decades is also true. The two are not a coincidence, there’s causality there. However, we hear often enough that it’s the residual control over industry by the government that drives that success. Sure, OK, so the bureaucracy doesn’t specify prices or detailed actions but the general guidance provided by a politically driven bureaucracy explains the outperformance.

Except it doesn’t. Those former state industries still enjoying that government guidance perform worse than the free market firms sadly lacking it. State planning is keeping China poorer than it need be, not aiding its growth.

The report he’s commenting on:

Changing the tiger’s stripes: Reform of Chinese state-owned enterprises in the penumbra of the state
Ann Harrison, Marshall W. Meyer, Will Wang, Linda Zhao, Minyuan Zhao 07 April 2019

The conventional wisdom that privatisation of state-owned enterprises reduces their dependence on the state and yields positive economic benefits has not always been borne out by empirical work. Using a comprehensive dataset from China, this column shows that privatised SOEs continue to benefit from government support in the form of low-interest loans and subsidies relative to private enterprises that have never been state-owned. Although there are clear improvements in performance post-privatisation, privatised SOEs continue to significantly under-perform compared to private firms.

Much of China’s economic growth has been driven by the emergence of a vibrant private sector, today accounting for approximately 60% of GDP and 80% of employment. Conventional wisdom holds that privatisation of state-owned enterprises (SOEs) reduces their dependence on the state and yields positive economic benefits including enhanced firm performance, productivity, and innovation. The pro-privatisation argument is that the state either cannot monitor managers properly or chooses not to pursue efficiency because state interests take precedence over financial results (Boardman and Vining 1989, Vickers and Yarrow 1991, Shleifer and Vishny 1994). Empirical work, however, has produced mixed results on privatisation. For example, DeWenter and Malatesta (2001) found that, among the 500 largest firms globally in 1975, 1985, and 1995, private enterprises had significantly lower costs and higher profits than SOEs. Yet, when they examined a sub-sample of privatised firms, they found inconsistent results – performance increased post-privatisation, while leverage and employment increased mainly pre-privatisation. Market returns from privatisation also differed across countries, positive in Hungary, Poland, and the UK but insignificant elsewhere.

Our research on privatisation in China (Harrison et al. 2019) is unique in several respects. We analyse an extremely large sample of industrial firms, more than 3.5 million firm-years from 1998 to 2013, drawing on the Annual Industrial Survey conducted by the China National Bureau of Statistics. We compare privatised firms with firms that remained state-owned and firms that had never been state-owned. Most importantly, we compare both the performance and dependence on the state of privatised firms with firms having no prior state ownership. Overall, our results indicate selective performance gains from privatisation – privatised firms have greater productivity and are more likely to file patents than firms remaining state-owned even though their return on assets barely improves. The performance effects notwithstanding, privatised firms remain dependent on the state. Subsidies, concessionary interest rates, and loans granted to privatised firms remain at nearly the same levels as those to SOEs. Privatisation changes the behaviour of firms but not firms’ dependence on the state.

A graphical portrayal of the differing performance of the three types of Chinese companies from the report:

Return on assets of state-owned enterprises, privatised state-owned enterprises, and privately-owned enterprises

QotD: Why does US healthcare cost so much?

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

This is a hotly debated question in health care policy. Here’s my rough stab at it: the 1970s inflation interacted particularly badly with two pre-existing policy choices: the tax deduction for employer-sponsored health insurance, and Medicare.

Start with employer-sponsored health insurance, which is, as everyone knows, tax advantaged relative to salary, because your employer can deduct it as an expense, but you don’t have to show it as income on your taxes.

This was an incredibly dumb decision, but in the defense of the folks who made it in the 1940s, at the time, health insurance wasn’t very expensive, because the health care system couldn’t do all that much (and the female labor that ran hospitals was cheap due to discrimination, or in the case of nuns, basically free).

Come the 1970s, inflation started causing a problem called “bracket creep”. Back then tax brackets weren’t indexed for inflation, so as inflation went up, folks got pushed into higher and higher tax brackets, even though the buying power of their salary had stayed the same, or [had] gone down. This was great for the government (and is a big reason our deficits were not disastrous in the 1970s), but it was terrible for people, and led to the tax revolts that helped put Reagan in office.

But I digress. The point is that bracket creep made non-taxed benefits much more attractive relative to salary, so insurance started getting more generous. That process has continued for decades. Insurance used to be “major medical” that covered big ticket items like hospital stays. Now we expect it to cover the cost of going to the doctor for the sniffles. Well, if you insulate people from those costs, they will incur more of them.

Effectively, this raises demand for health care services. But the US system, decentralized and litigation-happy, is very bad at controlling the supply side. End result: high costs.

The other thing that happened is Medicare. The original legislation called for reimbursing services at “reasonable and customary rates”. This was a gold mine for doctors and hospitals. In New York, for example, doctors used to be forced to do charity care as the price of their admitting privileges at prestigious city hospitals. Once Medicare came into the picture, there was no need for that! Or to economize on beds; you could always find someone to fill them. Eventually, Medicare tried to crack down (http://reason.com/archives/2011/12/13/medicare-whac-a-mole), but by then, it was damned hard to cut physician and hospital incomes, in part because they had made decisions based on their — like building new hospitals with all private rooms — that couldn’t be undone. Our cost base is permanently higher, and politically, we have shown no will to slash provider incomes. So even though our growth rate is about average for the OECD, we’re growing from a much higher level.

Megan McArdle, “Ask Me Anything”, Reddit, 2017-04-10.

April 7, 2019

Justin’s SNC-Lavalin swamp … how deep does it go?

Filed under: Business, Cancon, Government, Law, Politics — Tags: , , , , , — Nicholas @ 03:00

For a penny-ante scandal where there’s no hint of sexual impropriety or unmarked bundles of bills being passed along in brown paper bags, Justin’s SNC-Lavalin scandal looks more and more interesting the more we look at it:

A game-changing bombshell lies buried in the supplementary evidence provided to the House of Commons Judiciary Committee by former Attorney General Jody Wilson-Raybould.

It has gone virtually unreported since she submitted the material almost a week ago. As far as we can find, only one journalist — Andrew Coyne, columnist for the National Post — has even mentioned it and even then he badly missed what it meant, burying it in paragraph 10 of a 14 paragraph story.

The gist of the greatest political scandal in modern Canadian history is well-known by now. It’s bigger than Adscam, the revelation 15 years ago that prominent members of the Liberal Party of Canada and the party itself funneled tens of millions of dollars in kickbacks into their own pockets from federal spending in Quebec sponsoring ads promoting Canadian unity. That was just venal politicians and a crooked political party helping themselves to public money.

The Trudeau-SNC-Lavalin scandal is so much more, involving the corruption of the supposedly non-partisan civil service, and even the judiciary, for the political benefit of a disgraced political party, and a cover-up endorsed, encouraged and actively engaged in by the sitting Members of Parliament of that political party.

[…]

Which brings us to the ticking-timebomb-evidence the committee and the public didn’t get to hear.

In between the appearances by Butts and Warnick, Wilson-Raybould testified to getting a report from her chief of staff who had had a meeting with Butts and Trudeau’s chief of staff Katie Telford. They aggressively pushed the attorney general to get an “outside” opinion from someone like the retired Chief Justice of the Supreme Court, Beverley McLachlin, on dropping the criminal charges against SNC-Lavalin in favour of a non-criminal plea deal.

Wilson-Raybould took contemporary notes of what her staff member told her.

    “My COS (chief of staff…ed) asked what if the opinion comes saying “She can review it, but she shouldn’t” or simply “She can’t review it” end of story? Mr. Butts stated “It wouldn’t say that.”

BOOM!!!!!!

Read what Butts said again. And again. And again.

“IT WOULDN’T SAY THAT”

H/T to Halls of Macademia and Small Dead Animals for the link.

April 5, 2019

QotD: Debunking the “MSG is harmful” myth

Filed under: Business, Food, Health, Quotations, Science — Tags: , — Nicholas @ 01:00

The story of MSG is a true tragedy. The negativity associated with this delicious amino acid is due to a spurious study from 1968 that linked MSG with the “Chinese Restaurant Syndrome.” This study connected that gut-bomb feeling you sometimes get after eating Chinese food to MSG, despite the fact that the typically cheap Chinese food prepared in American restaurants is fatty and served in large portions, and (like any restaurant), the food can be spoiled. My mom theorizes that lots of MSG was used to cover up the fact that, say, shrimp was a day past its prime, and that the sick feeling was due to the food but got blamed on the MSG. There’s never been a scientifically rigorous study that’s linked MSG with any negative effects. MSG should be used frequently and added to anything that needs the flavor drawn out, especially soups. But it enhances virtually anything it touches: Once, eating pizza at home, a friend scanned my spice rack and saw a jar with white powder whose label, in my grandfather’s messy scrawl, read what looked like “MS6.” He sprinkled it on his pizza and came to find me, telling me that whatever MS6 was, it was the most amazing thing he’d ever tasted. Yes, MSG makes even pizza better.

Caitlin PenzeyMoog, “Salt grinders are bullshit, and other lessons from growing up in the spice trade”, The A.V. Club, 2017-04-06.

April 4, 2019

Ingram M10 & M11 SMGs: The Originals from Powder Springs

Filed under: Business, History, Military, Technology, USA, Weapons — Tags: , , , , — Nicholas @ 06:00

Forgotten Weapons
Published on 3 Apr 2019

These SMGs are lots 1069 (M10/45), 1070 (M10/9), and 1067 (M11) at Morphy’s April 2019 auction:
https://www.forgottenweapons.com/ingr…

After the commercial failure of Gordon Ingram’s M6 submachine gun in the early 50s, he would radically change the layout of his designs. Instead of a Thompson-lookalike Ingram’s M10 (the M7, M8, and M9 doing experimental prototypes only) would be a boxy and compact affair with a Czech-style telescoping bolt. It found little interest until a meeting between Gordon Ingram and Mitch WerBell resulted in WerBell demonstrating it to excited military audiences in Vietnam in 1969.

WerBell was an ex-OSS man who had started a company called Sionics, selling suppressors to the US military. He thought the combination of Ingram’s submachine gun and his suppressor would be a fantastic package, and he found plenty of interest among special operations personnel in Vietnam. He would create the Military Armament Corporation based at his farm in Powder Springs, GA and entice Ingram to join as his chief engineer. The result would be the .45ACP M10, a 9mm version of the M10 (made for use with subsonic 9mm ammunition), and a scaled-down .380 ACP M11 submachine gun.

MAC would have a short life, with all its assets sold at a bankruptcy auction in April 1976 – but it had plenty of time to create what would become an iconic gun – the Big MAC. Many imitations and copies would follow, but Powder Springs was the home of true original Ingram M10 and M11 submachine guns!

http://www.patreon.com/ForgottenWeapons

Cool Forgotten Weapons merch! http://shop.bbtv.com/collections/forg…

Contact:
Forgotten Weapons
PO Box 87647
Tucson, AZ 85754

Of course Facebook is now in favour of government regulation … it’ll keep out their competition

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

The recent calls for the government to regulate social media got support from Mark Zuckerberg, which seems to have surprised some in the media. It’s not at all uncommon for established firms to not only welcome government oversight but to actively support it — because it’s a highly effective strategy to strangle smaller competitors and keep new competitors from entering the field:

On Saturday, Mark Zuckerberg appealed to the government for increased regulation of the internet including his company Facebook. According to Zuckerberg, increased government action is needed to protect society from harmful content, ensure election integrity, protect people’s privacy, and to guarantee data portability. If enacted, the government would possess a wide range of control over internet businesses. For Zuckerberg, this is for the public’s best interest.

But make no mistake about it, Zuckerberg’s cries for regulation is not an appeal to his humanitarianism. On the other hand, it solves glaring issues that Facebook has faced since the 2016 election.

[…]

With increased government oversight, Facebook’s leadership will finally be able to pass the buck to someone else. The government will provide them with a clear set of rules that they will be accountable for. Any negative press coverage that occurs outside of those guidelines, will not be attributable to their company but to the rule-making body of the government. This will allow Facebook’s leadership to regain credibility within a clearly definable framework that they are not responsible for creating.

But perhaps Zuckerberg’s appeal for regulation is even more cunning. Government regulation will undoubtedly be met with higher costs. Internet companies will have to spend more on staffing to be in compliance with the increased burdens implemented by the rule-making body. We saw this play out in the banking industry after the Great Recession. A study conducted last year found that since 2009, banks have been fined a total of $345 billion dollars in penalties and noncompliance costs. Further, another study found that in 2016 banks spent $100 billion dollars on regulatory compliance alone.

Large internet companies like Facebook and Google will easily absorb the strain of increased regulatory costs. It is the smaller businesses that will feel the financial squeeze. With increased regulatory compliance spending, smaller startups will face an even bigger hill to climb to compete with the likes of Facebook.

Another “feature” of government regulation is what is known as “regulatory capture”, as the regulating body and the regulated organizations, after an initial period of ostentatious “conflict”, settle down into a cosy symbiotic relationship … in only a few years, many of the regulatory staff will find themselves working for one of the regulated organizations, and vice-versa. The regulatory body will — like all bureaucracies — start to care more about keeping itself alive and growing than about the original reason it was set up. Small organizations will stall or go extinct, and only the existing dinosaurs will carry on, protected from competition by their regulator’s powers.

March 30, 2019

The EU’s copyright regulation is a stalking horse for online censorship and control

Filed under: Business, Europe, Government, Liberty, Media, Technology — Tags: , , , , , , — Nicholas @ 03:00

To the amazement of many non-EU observers, the European Parliament passed blatantly authoritarian and corporatist changes to the rules on copyrights that will have potentially vast impact on the internet across the world, not just inside the EU. At City A.M., Kate Andrews explains why this is such bad news for all internet users:

The two most controversial points in the law – Article 11 and Article 13 – are almost certain to stifle digital activity, and interfere with the free way that people currently use online platforms.

Article 11, known as the “link tax”, would make online platforms compensate press publishers for links and article content posted on their sites.

As my colleague Victoria Hewson highlighted in her latest briefing, this approach has been “widely criticised as a distortive measure that seeks to prop up a declining industry”.

As many local and national newspapers decline in readership and revenue, governments have become increasingly protectionist in their attempts to “rebalance” the sector, by cracking down on online platforms.

The link tax has little merit, even if rebalancing is the goal. News outlets which require payment for readership already have logins and paywalls to protect their content from free access.

[…]

Article 13 will also be distortive to the market, as it makes online platforms increasingly liable for copyright infringement.

As Hewson’s briefing notes, major online platforms already have routine screening processes for content that violates copyright law or their own rules. But the new regulations “remove the protection for platforms previously available if they removed violating content promptly on receiving notice of it, and contravene fundamental rights such as free expression and freedom from monitoring”.

The Directive claims that safeguards – including pastiche, parody, and quotations – will be protected, and that meme content has been excluded.

But the algorithms which these platforms will have to implement to adhere to Article 13 are going to struggle to see the difference between infringement and fair use when comparing uploads to content that is registered as copyrighted.

QotD: Organic spices are a racket

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

There’s a whole other piece to be written about organic spices, but the short version is that demanding organic spices is never going to be good for the farmers growing them. The U.S. standards for organic products amounts to ridiculously expensive and oftentimes unnecessary practices for small farmers who just don’t have the resources to do it. There are plenty of ways to arrive at ethical treatment of animals and land that are not part of our complicated organic laws. And that’s not to mention the people who demand organic products but will also freak out at the sight of a bug or won’t buy something that’s even a little bit misshapen or with a tiny brown spot on it. You can have pesticides or you can have pests.

Caitlin PenzeyMoog, “Salt grinders are bullshit, and other lessons from growing up in the spice trade”, The A.V. Club, 2017-04-06.

March 22, 2019

Understanding the Great Depression

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

Marginal Revolution University
Published on 23 May 2017

In this video, we examine the causes behind the Great Depression with the help of the aggregate demand-aggregate supply model.

In 1929, the stock market crashed and an air of pessimism swept across America — making bank depositors nervous. What would you do if you thought your money might not be safe with the bank? You’d probably want it back in your own hands. What happened next? A run on the banks.

Along with the Stock Market Crash of 1929, it’s one of the iconic moments of the early days of Great Depression. However, the Great Depression was an incredibly complex downturn in which the economy experienced a series of aggregate demand shocks. By the end of this video, you’ll walk away with a better understanding of the many factors behind the Great Depression and how to apply the AD-AS model to a real-world scenario.

March 20, 2019

A Supreme Court case that created huge sales tax problems for online firms

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

Eric Boehm explains why an obscure US Supreme Court ruling is making life extremely complicated for thousands and thousands of online businesses:

… Until last year, that meant Heitman was responsible for collecting and paying sales taxes to exactly one place: the Wisconsin Department of Revenue. But thanks to an under-the-radar ruling from the U.S. Supreme Court in June, he’s now receiving letters, phone calls, and emails from revenue officials across the country, each wanting a piece of his business.

The source of Heitman’s frustrations is Wayfair v. South Dakota, which allowed states to collect sales taxes from online businesses located beyond their borders. Many states view the Wayfair ruling as a potential tax revenue windfall in which the taxes are paid by non-residents who can’t vote against them. That’s why businesses like Heitman’s are now facing the chilling prospect of owing taxes in dozens, and possibly hundreds, of different jurisdictions — while being hounded by out-of-state tax collectors.

Since the Supreme Court issued its ruling in June, Heitman has been scrambling to become compliant with tax commissions and revenue departments from coast to coast. He’s spent thousands of dollars on new software to help navigate the complexities of state sales tax law, but that’s only been so much help. “It almost seems like I have another full time job dumped on me with this sales tax thing,” he says. “It’s burning me out.”

As the 2019 tax season begins, states are ramping up efforts to squeeze extra revenue out of remote retailers like Heitman, putting an expensive new burden on businesses that have found broad customer bases online. The burden is particularly large in the five U.S. states that charge no sales tax, where entrepreneurs could now be charged with paying a tax they have never had to pay before, to a government over which they have no voice. And while Congress could clean up the Supreme Court’s mess, it’s far from certain that it will.

Warren Meyer points out that it’s not just the individual states who are taking advantage of this windfall opportunity to collect taxes from non-residents:

Like most writers, Mr. Boehm actually understates the problem. Because the potential exists not to have 50 new taxing authorities for every sales, but thousands. I have to deal with this every day. I wrote a while back:

    Take Arizona, which seems from my experience to be roughly average. The sales tax rate table is 18 pages long in a small font. There are 29 separate rate categories which each have different rates in each of Arizona’s 15 counties. My business is in 6 counties and we have 3 rate categories that apply, or 4 if you consider items with no tax as another rate category. This is 24 different state/county sales tax rates we charge. But that is the easy part. Because then there are, in addition to county taxes, 92 different towns and cities that have their own rate tables with up to 29 different rate categories that add to the base state/county rate. Other states such as Washington (rule of thumb — if the state has no income tax then it has a LABYRINTHIAN sales and business tax systems) have additional overlay taxes such as for transit and stadium districts.

    When my company opens a new location, we have to spend hours on the Internet and with maps trying to figure out what sales taxes to collect, and even with good due diligence we sometimes get it wrong and find in an audit we are actually just inside or outside some line where the rate changes (we once had a location 30 miles outside of Seattle on a long dirt road where we found we had to collect the Seattle Rapid Transit tax). Thatcher, AZ is a town of like 4000 people but has its own special sales tax rates — do you know where the town line is? Well neither do they, because last time I checked they did not have any sort of online lookup system to tell one automatically if the address is inside or outside the town and its sales tax district…

    But even after registering in all 50 states, you are STILL not done, because many states don’t have a fully unified sales tax collection system. In Arizona, for example, the larger cities require their own registration and monthly reporting.

Meyer is operating a company that has physical assets and employees in each of the states and lesser jurisdictions to which taxes are due. Internet businesses generally only have physical assets in a single state, yet an expansive reading of the Wayfair ruling (the type of reading most jurisdictions will prefer) makes them liable for taxes almost everywhere.

March 15, 2019

Big business and the rise of Hitler and the Nazi party

Filed under: Books, Business, Germany, History — Tags: , , , — Nicholas @ 03:00

Alec Stapp reviews a new book by Tim Wu which contends that big business in the US is going to enable the rise of fascism just as it did in Germany in the 1930s … except that wasn’t how it happened in the Weimar Republic:

Hitler, Göring, Goebbels and Hess.
Photo via Wikimedia Commons.

The recent increase in economic concentration and monopoly power make the United States “ripe for dictatorship,” claims Columbia law professor Tim Wu in his new book, The Curse of Bigness. With the release of Senator Elizabeth Warren’s proposal to “break up” technology companies like Amazon and Google, fear of bigness is clearly on the rise. Professor Wu’s book adds a new dimension to that fear, arguing that cooperation between political and economic power are “closely linked to the rise of fascism” because “the monopolist and the dictator tend to have overlapping interests.” Economist Hal Singer calls this the book’s “biggest innovation.”

The argument is provocative, but wrong. As I show below, the claim that big business contributed to the rise of the Nazi Party is simply inconsistent with the consensus among German historians. While there is some evidence industrial concentration contributed in Hitler’s ability to consolidate power after he was appointed chancellor in 1933, there is no evidence monopolists financed Hitler’s rise to power, and ample evidence showing industry leaders opposed his ascent.

Thomas Childers, a professor of history at the University of Pennsylvania, calls the idea that Hitler was bankrolled by big corporate donors a “persistent myth.” This, among myriad other reasons, should give us pause before comparing 1930s Germany to the present-day United States. If fascism does come to the United States, big business won’t be to blame.

[…]

In the run-up to the presidential election in the spring of 1932, Hitler gave a speech to “a gathering of some 650 members of the Düsseldorf Industry Club in the grand ballroom of Düsseldorf’s Park Hotel.” British historian Sir Ian Kershaw recounts the event in Hitler: A Biography (p. 224):

    Hitler’s much publicized address … did nothing, despite the later claims of Nazi propaganda, to alter the skeptical stance of big business. The response to his speech was mixed. But many were disappointed that he had nothing new to say, avoiding all detailed economic issues by taking refuge in his well-trodden political panacea for all ills. And there were indications that workers in the party were not altogether happy at their leader fraternizing with industrial leaders. Intensified anti-capitalist rhetoric, which Hitler was powerless to quell, worried the business community as much as ever. During the presidential campaigns of spring 1932, most business leaders stayed firmly behind Hindenburg, and did not favour Hitler … The NSDAP’s funding continued before the ‘seizure of power’ to come overwhelmingly from the dues of its own members and the entrance fees to party meetings. Such financing as came from fellow-travellers in big business accrued more to the benefit of individual Nazi leaders than the party as a whole. Göring, needing a vast income to cater for his outsized appetite for high living and material luxury, quite especially benefited from such largesse. Thyssen in particular gave him generous subsidies, which Göring — given to greeting visitors to his splendrously adorned Berlin apartment dressed in a red toga and pointed slippers, looking like a sultan in a harem — found no difficulty in spending on a lavish lifestyle.

As Ralph Raico, a professor of history at Buffalo State College, points out, the aim of these “relatively minor subsidies” to particular Nazis “was to assure (the donors) of ‘friends’ in positions of power, should the Nazis enter the state apparatus.” In Hitler: Ascent, 1889-1939, German historian and journalist Volker Ullrich details the extent of the industrialists’ support for center-right parties during the time of the Düsseldorf speech (p. 292):

    [T]he American historian Henry A. Turner and others following in his footsteps have corrected this outmoded narrative about the relationship between National Socialism and major German industry. By no means had the entire economic elite of the Ruhr Valley attended Hitler’s speech… The crowd’s reaction to Hitler was also by no means as positive as (Nazi Press Chief Otto) Dietrich’s report had its readers believe. When Thyssen concluded his short word of thanks with the words “Heil, Herr Hitler,” most of those in attendance found the gesture embarrassing. Hitler’s speech also did little to increase major industrialists’ generosity when it came to party donations. Even Dietrich himself admitted as much in his far more sober memoirs from 1955: “At the ballroom’s exit, we asked for donations, but all we got were some well-meant but insignificant sums. Above and beyond that there can be no talk of ‘big business’ or ‘heavy industry’ significantly supporting, to say nothing of financing, Hitler’s political struggle.” On the contrary, in the spring 1932 Reich presidential elections, prominent representatives of industry like Krupp and Duisberg came out in support of Hindenburg and donated several million marks to his campaign.

The period immediately following Hitler’s speech to the Düsseldorf Industry Club was similarly fruitless for fundraising, as Richard J. Evans, a professor of history at the University of Cambridge, describes in The Coming of the Third Reich (p. 245):

    Neither Hitler nor anyone else followed up the occasion with a fund-raising campaign amongst the captains of industry. Indeed, parts of the Nazi press continued to attack trusts and monopolies after the event, while other Nazis attempted to win votes in another quarter by championing workers’ rights. When the Communist Party’s newspapers portrayed the meeting in conspiratorial terms, as a demonstration of the fact that Nazism was the creature of big business, the Nazis went out of their way to deny this, printing sections of the speech as proof of Hitler’s independence from capital. The result of all this was that business proved not much more willing to finance the Nazi Party than it had been before.

Hitler lost the spring 1932 presidential election to Hindenburg. But the Nazi party achieved a plurality of seats in parliament for the first time in the July 1932 elections. Unable to form a government without Nazi cooperation after yet another round of elections in November 1932, Hindenburg appointed Hitler chancellor on January 30, 1933. With Hitler now in power, things changed.

In a 2014 review, Larry Schweikart wrote:

Still, more than a few voices critical of such historical hanky-panky have been raised. Perhaps the most influential is that of Henry A. Turner, Jr., who has provided an accurate and verifiable history of the Weimar period in his German Big Business and the Rise of Hitler. Turner sensibly avoids class struggle as a theme and simply asks if big business liked Hitler. Did business leaders support him? Did they give him money? Turner concludes that they did not. Only “through gross distortion can big business be accorded a crucial, or even major, role in the downfall of the Republic” (p. 340). Turner claims that bias “appears over and over again in treatments of the political role of big business even by otherwise scrupulous historians” (p. 350).

In his own examination of the evidence, Turner looked at the correspondence of German business leaders, minutes of their meetings, and their contributions. While it might be reassuring for some to think that Hitler came to power through the financial support of a few evil businessmen, the facts are that most of the Nazis’ money came from the German people. Turner carefully dis­cusses Hitler’s policy stances toward business. Hitler was always wary of alienating the business­men, but his failure to present a clear, procapitalistic economic program made the corporate leaders all the more leery of him. Modern Marx­ists, quite naturally, would like to implicate capitalism in the Holocaust. But, of course, Hitler’s themes were those of Stalin and, in our own day, Gorbachev. Nazism, as Turner suggests but never makes sufficiently clear, resembled Marxism in many ways, including Jew-hatred and hostility to the individual. In any case, Turner’s book has completely refuted the accepted notions that German corporations supported Hitler.

H/T to Colby Cosh for the initial link.

March 11, 2019

QotD: The purpose of language

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

But back to the mystics in general. I refuse to be swallowed up by their bullshit, nor do I allow myself to feel in any way inferior to their apparent greater knowledge. I once listened to some consultant describe a proposed change, and the description was filled with consultant-jargon — oh yes, they too have to impress clients with their insider language — and when he was done, I said, as succinctly as I could: “I didn’t understand a single thing you just said. Could you restate it, but in plain English this time?”

“Oh,” he stammered, “I simply meant that we need to streamline the process to shorten our product’s time-to-market.”
“You mean, the time between the thing’s production and its appearance on the retailer’s shelf?”
“Yes.”
“Then why didn’t you just say that, instead of having me waste both our time by getting you to explain it to me?”

Roger Moore put it best, I think: “The point of language is to communicate your thoughts in the shortest possible time and in the clearest possible way.” My corollary to that excellent sentiment is, “And if somebody is not doing that, he’s pursuing a different agenda or has something he wishes to disguise.”

And finally, I should point out that Moore’s “clarity” does not equal “simplistic” (I nearly wrote simplisme, but you guys would have chased me from the room, and justifiably so).

Semper claritas should be your guiding principle.

Kim du Toit, “Mystics”, Splendid Isolation, 2017-03-28.

March 10, 2019

There’s something bigger at stake in the SNC-Lavalin affair than Trudeau’s career

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

Chris Selley explains why SNC-Lavalin is an example of Canada’s less-than-stellar record of holding corporations to account:

… University of Michigan law professor David Uhlmann argues in a 2016 paper, “criminal prosecution of corporations upholds the rule of law, validates the choices of law-abiding companies, and promotes accountability. … When corporations face no consequences for their criminal behavior, we minimize their lawlessness, and increase cynicism about the outsized influence of corporations.”

No kidding. And in a country like Canada, not to say a province like Quebec, it’s safe to say these lines of accountability and trust get severely tangled. Once a government deems any company “too big to fail,” whether it’s because of political donations or connections, or because its pension plan is heavily invested, or because it has acquired a creepy semi-sacred status among otherwise normal people — or indeed, because of an alleged 9,000 jobs — all these nice theories about the rule of law break down. That’s what we’ve been witnessing.

But there’s an even bigger breakdown going on that’s received far less attention. Employees allegedly behind Lavalin’s Libyan capers were criminally charged as well. Between them, former vice-president Sami Bebawi and former controller Stéphane Roy faced charges including defrauding the Libyan state, money laundering, violating UN sanctions, bribing Saadi Gadhafi — Moammar’s soccer-playing, Montreal-enjoying third son — and trying to extract him from Libya once it all kicked off in 2011.

Those charges were laid in February 2014. Last month, some against Bebawi and all against Roy were dismissed because the Crown didn’t manage to bring them to trial in five blessed years. In a scathing decision, judge Patricia Compagnone characterized the Crown’s behaviour as a perfect illustration of the “culture of complacency” and the “culture of delays” the Supreme Court had assailed in its landmark 2016 Jordan decision, which established empirical standards for the Charter right “to be tried within a reasonable time.”

It is an ever-more-curious mystery that Canada’s comprehensively screwed-up justice system never rises to the level of political crisis. In the first year after the Jordan decision alone, some 200 cases were thrown out on grounds of excessive delays. Some of the accused make the Friends of Moammar look like saints. They include alleged murderers, child molesters and drunk drivers.

The charges against SNC-Lavalin were laid in February 2015. More than four years later, we’re still fighting over whether to pursue them — and not, it must be said, in a way that makes us look like a terribly serious country. How nauseatingly fitting it would be if a court threw the case out before the feds even got a chance to decide what to do with it.

March 4, 2019

Twitter’s vast latifundia of techno-serfs

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

In Quillette, Alec Cameron Orrell debunks the notion that the average Twitter user derives much benefit from time spent on the site:

Researchers of social media both in the Academy and in Silicon Valley have apprehended for a long time that social media prey on the dopamine rewards system of the brain. Some have used this knowledge to exploit users; others have used it to warn the public of a digital narcotic epidemic. The frisson of delightfully outraged purpose that courses through a user’s nerves as he reads or responds to a post arises from the same brain system that rewards a human being for consuming a healthy meal or organizing his sock drawer. The Hollywood actors who have done mighty work to support the Bolivian cocaine trade in the past can’t put Twitter down now, and that’s no accident.

Digital abolitionists grow more and more strident and numerous these days. Many — including early Facebook investor McNamee — hail from inside Silicon Valley. A raft of articles over the last few years have documented the wave of Silicon Valley techno-elites who, like savvy drug cartel bosses, forbid their own children from using the devices and social media platforms they build, while they encourage their employees to spend frequent periods “unplugged.” They know social media and mobile devices create users, and some have been brave enough to lobby the public for a shift in consciousness.

The slave reaps no substantial or real-world payment for his labor. Chemical slaves to drugs get nothing but misery and poverty in the end. Social media users subsist in an analogous trap, subtle and harder to spot. When it comes to social media, 99.9 percent of users will never see any substantial return on what stacks up to be an enormous longterm investment of time. Users will experience some fleeting stimulant sensations and a smattering of poorly organized — or incorrect—information. “I find out what’s happening on Twitter!” or “I get to promote myself on Twitter!” amounts to self-delusion on par with the vile Antebellum plantation saw that “Slaves get paid in the satisfaction of a hard day’s work and some are even taught how to read!” Such apologetics leverage false but presentable ends to cover horribly exploitive means — means the real ends of which are too embarrassing to admit. The average Twitter user might make the odd connection or get some attention for his business on Twitter, if he keeps at it day after day. In contrast, Jack Dorsey always gets paid handsomely for the user’s time on-site month after month by advertisers. The users work the platform with their attention, and Master Jack goes home with the check.

Unless already famous, the chances of reaping substantial reward from Twitter — such as income or significant growth of attention from others — roughly equal the chances of winning the lottery. And like the lottery, millions of average users chip in and hope, while just a few luck out and get a payout. Those few average users who get a mediocre reward — and even fewer who get famous with a lucky tweet or some such — keep the millions of average users coming back to try their luck every day. The little blue bird runs on the principle of the one-armed bandit and Powerball.

Virtually all users end up losing in the long-term. Most lose hours and hours scrolling through quips and posting burns, sifting through nonsense to find the odd bit of useful information, but mostly for distraction. Like their casino cousins cursed by fate with a gambling addiction, an unlucky minority of Twitter users lose everything on the platform without meaning to. A particularly ill-considered tweet brings down on their heads digital lynching, infamy, disgrace, loss of employment, loss of a spouse, libel lawsuits, and in some countries, criminal indictment for hate speech or threatening behavior. Uncounted thousands of users have operated their mobile devices under the influence of Twitter on the information superhighway, only to wind up with a digital DUI or in an online 25-car pileup.

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