Question of the Day My favorite thing about this site is that I get to ask my readers to answer questions for me that they know more about than I do.
So here's my question today, for the scientists and engineers out there: assume that we do, in fact, convert to renewable energy sources -- solar and wind.
Are the weather effects of sucking all that energy out of the climate system better or worse than the weather effects of burning fossil fuels?
Good article from the Boston Herald on why the Democrats lost Massachusetts. I think it has wider application to the party across the nation.
The Democratic Party is indeed a big tent, so large it seems to include virtually every politician in the state. But what does it stand for? Outgoing Senate President Thomas Birmingham and House Speaker Thomas Finneran are almost opposites on a wide range of issues. Yet each calls himself a Democrat. Aside from a desire for power, is there any common bond?
Perhaps there is none. And perhaps that was the real flaw in O'Brien's campaign. She was standard-bearer for a party that is spread too thin, a party that too much defines itself as an amalgamation of interest groups rather than by some coherent political philosophy. Unlike, say, Jill Stein, O'Brien had no overarching cause with which to capture the public imagination.
And so, with nothing uniquely substantive to say, O'Brien ended up running a campaign based on style. On Election Day, as it turned out, she just wasn't in fashion.
Looks like we've got a couple of cases of bubonic plague here in New York.
Eeek! The sky is falling! The terrorists are coming! Run for the hills!
No, the editorial board will not be retreating to the Secret Live From The WTC bunker. The editorial board is much more worried about the unexplained outbreak of Leptirosis in Riverside Park, which threatens The Official Live From The WTC Canine Companion.
The people with the bubonic plague are a couple. They're from New Mexico. Where bubonic plague is found in the local rodent population. So probably, they didn't get it here.
Also, while the plague did a nasty job on Europe in the Middle Ages, we lack the conditions that made it so deadly. Houses filled with straw and the rats that live on it. The hygeine of your typical college druggie frat. Medical treatment that centered around wearing garlic and accusing Jews of poisoning the wells. If it's caught early, bubonic plague is highly treatable. While I don't doubt that Al Qaeda would like to bioengineer some supergerm that would resist antibiotics and only spare the faithful, who would be protected by miraculous intervention from Allah, I doubt they have the resources in their caves.
Walk me through the logic here: you just got routed in an election in which voters specifically expressed a desire to hand control of the Senate over to the other party. The main factor in your defeat seems to have been the opposing party's overwhelmingly popular president. So the problem, say Democratic pundits, is that the party didn't "stand up to the president", and need to either
a) Move to the left b) Go negative on the president
I'm afraid I'm not following the logical leap from
1) The voters dissed us because they like the President
to
2) We must therefore vigorously oppose the President by any means necessary.
Greg Ip on page one of the WSJ: "Total debt, excluding the federal government, now equals 158% of gross national product. The last time debt rose to that level was in the late 1920s. Indeed, both the 1920s and 1990s saw a surge in new forms of debt-financed consumption -- installment plans in the 1920s, 'cash out' mortgage refinancings in the 1990s. But the fact that consumer debt has doubled since the 1950s to 90% of personal income isn't of great concern to Fed officials. They attribute it to a more sophisticated financial industry that has made credit easier to get, and to the rise in home ownership which means many people have substituted mortgage payments for rent." Another factoid: "In the 1950s, car prices rose about 0.5 percentage points a year faster than inflation, says Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Mich. Car makers' productivity was rising rapidly, and sales were advancing 3% to 4% a year. In today's dollars, manufacturers earned about $1,500 per vehicle. Today productivity is growing more slowly, the world is awash in idle auto factories and a strong dollar is holding down the price of imported vehicles. As a result, Mr. McAlinden says, new car prices have fallen 0.2% a year since 1996 and profits per vehicle are down to about $400."
I'm also hearing that the Democrat would have won if htey hadn't lost Wellstone. In one sense, I think that's true -- I think the rally cost them the Senate. But in the sense that they mean it, which is that Wellstone would have won, I think that's wishful thinking. Wellstone was the Democratic senator in the worst shape, and he was targeted accordingly. Republicans took every Senate seat, except SD, that was even remotely feasible. Wellstone's death helped, rather than hurt, the Dems, until that rally. So while I think they were in worse shape after the rally, this was not an act of God that cost them the race. It was the mean-spirited behavior at the rally.
One of the exciting things about this is that there is a -- slim -- chance that we'll get tax simplification.
Peace, my little pinko chickadees. I don't mean lowering taxes on the rich. I just mean getting rid of the 8 zillion deductions we all take, lowering rates a little to compensate for the loss of deductions, and thus hopefully goosing the economy.
Now, lots of people argue whether or not raising taxes hurts or helps growth. Though intuitively, it seems obvious that lower taxes would translate directly into higher growth, the empirical evidence for this is thin on the ground.
But almost all economists would agree that a simpler tax code is a great thing for the economy. We spend over $300 billion in this country on tax compliance -- the cost of accountants and tax lawyers making sure our taxes are in order. That doesn't count the budget for the IRS, the courts, and the economic losses we take when companies and individuals divert resources into tax-favored activities.
The problem is, of course, that if they try to do it, the lobbyists will descend on Washington like a plague of locusts. Of course, in theory, we're all in favor of a simpler tax code -- but not at the expense of my deduction. Every single one of them will be fighting tooth and nail to prevent any deduction, no matter how minor, distortionary, and overall useless, from being cut. Unfortunately, while they're talking about making the reform revenue neutral -- meaning that it will neither raise nor lower taxes -- and keeping the current progressive structure, that doesn't mean that everyone will be exactly as well off as they were before. People without deductions, like (full disclosure) me, will be better off. People who take a lot of deductions will lose out.
The only way we can fight for this is by getting energized about it. I know, I know -- it sounds kind of like trying to get energized about proposed changes in the labeling standards for marshmallow fluff. But this is important. In economic terms, it's free money for the country -- we get to grow the economy, without costing ourselves, as a nation, any tax revenue. Even if it means you pay a couple hundred more every year, in the long run you'll be better off. And you'll have sent a powerful message about politicians using the tax code to buy off favored consituencies. So write your congressman. Tell any lobbying groups to lay off. Let the process run.
Terry McCauliffe is not learning his lesson. He's just gone on TV to proclaim that this was all about the Bush family. I know his job is to raise money among the faithful, but the vendetta is not winning the party any points outside the party.
I'm watching Mondale's concession speech. It's dignified and sweet, and does him credit.
I think Mondale is doing a good thing -- closing off the possibility of lawsuits. The country doesn't need any more Floridas. I hope that we see like considerations in South Dakota.
-- The Democrats fell into the same error as the Republicans in the late Clinton years -- they focused all their energy on assaulting a president whose popularity was an unbreachable fortress. The Democrats could have done fine attacking Bush domestically -- but refusing to pass judges they thought might be pro-life, when over 50% of the country is against abortion except in cases of rape, incest, or life of the mother, hurt their image. And the dithering about the war was handled about as badly as it could have been. While they debated what to do about Iraq, they lost valuable time they could have spent on domestic issues. That would be okay if their debate had been fruitful. But really, all they were debating was what they could do to steal the President's momentum on Iraq. And the answer was, "Not much."
-- As Kaus says, the "It's just a symptom of the 50/50 nation" spin is ludicrous. Republicans took every race they were expected to, staged several upsets, and exit polling indicates that many of the voters were motivated by handing the Senate to the president's party. Apparently the only way to lose as a Republican in a close race was to divorce your wife of 29 years and marry your younger aide, in a southern state. The Dems can't really count on all the GOP candidates doing this.
-- That doesn't mean it's a mandate to go hog wild. And everyone who's been telling me they're going to pillage the land and sow it with salt should relax. The Senate is still too close to ram the Republican party's unvarnished platform through, since they don't have enough votes to overcome a filibuster. We'll get some judges, is all, and about time.
-- Democrats who are saying things like "This is a victory for the Taliban wing of the Republican Party" should take a minute to think. That would make your guy the Guy Who Was So Awful He Couldn't Win Against The American Equivalent of Osama Bin Laden.
-- The memorial service for Paul Wellstone was a disaster. I took a lot of heat just for saying that it probably wasn't going to play well -- partisans responded "Who the hell are you to tell the family how to grieve?" Well, no one, unless they put it on TV and invite me to watch it. And it looks like it cost them Minnesota, which means no hope for a save by Lincoln Chafee. It's your party . . . so was it worth it?
-- I think I was right that the Republican base was energized by New Jersey and Minnesota, while the Democratic base was apathetic. I think the rally, and the New Jersey substitution, may have cost more than they gained. Republicans were mad as hell. Democrats stayed home.
-- Going after Jeb Bush because of who his brother was was a waste of time and money, and didn't exactly improve the image of the party.
-- I don't think this represents a long term trend. This is about 2002, not the new millenium.
I think I was right about the Republican turnout -- we're seeing some stunning Republican upsets, while the Democrats are only picking up seats we expected. I think it's better than 50% that the Republicans will take the house. All eyes will be on two things: lawsuits, and Lincoln Chafee.
Oh, jolly. Looks like WorldCom was cheating more than they told us. The SEC just amended the complaint to reflect a longer history of fraud, and an additional $1.8 billion in deceptive charges.
I know of course that I should not laugh at such things. But this VodkaPundit quote is too funny:
. . . in Colorado, the nastiest local race I’ve seen is the one for District 11 of the State Senate.
“Duty and honor are important to us, but they aren’t to Ed Jones.”
So begins an attack ad by Jones’ opponent, Tony Marino.
Jones counters that Marino declared Chapter 11 rather than pay his credit card bills.
Marino says Jones is abusing the memory of his dead wife.
Jones claims Marino represents “Denver money” (a high crime here in El Paso County) and “labor union control” (ditto).
This is what we have to listen to during Seinfeld commercial breaks if we want some TV noise behind us while I grill steaks and Melissa frenches some fries.
The cheap attack routine got old in a hurry. And at long last, it’s all over but the shouting. Oh, and the lawsuits.
It makes me laugh because it sounds like a parody of our attack ads.
"George Pataki is a liar, a cheat, and a fraud."
"Tom Golisano says George Pataki is a liar, a cheat and a fraud. But that's a fraudulent, cheating lie. And Tom Golisano is only telling it so he can get into office and enact his secret plan to throw senior citizens on the street to starve."
"Tom Golisano loves senior citizens. But that lying, cheating fraud George Pataki is saying he wants to throw them on the street. That's because George Pataki, and his BIg Democrat Bedfellow Carl McCall, don't want you to elect Tom Golisano. They know that if Tom Golisano gets elected, they won't be able to grind senior citizens into mulch and sell them to their Friends In Big Agribusiness."
"Tom Golisano kills puppies."
"Carl McCall eats children for breakfast -- and he doesn't even use ketchup."
"George Pataki told the Manchester Union-Leader that if he gets elected, he'll use his office to sell our planet to aliens from the planet Kordor, so they can enslave humanity, kill our puppies, and eat our children on toast -- without ketchup."
On second thought, I don't know whether to laugh or to cry.
It doesn't surprised us that a Republican thinks registering people to vote is a dirty trick. But it does surprise us that Last completely ignored the last week's worth of coverage on this little non-scandal. "Lots" of dead Native Americans? Try 15 -- a number that includes deceased and underage voters -- in a total of 25 counties, according to this recent story in the Argus Leader. The South Dakota election is close, but it ain't that close, buddy. And while state and federal authorities are investigating, as they should be, Republican attorney general Mark Barnett has been busy smothering the notion that there's any widespread fraud. Why? Because no actually fraudulent voting has occurred, the number of fraudulent registrants is insignificant and the conspiracy so far appears to be limited to a single independent contractor. So much for that one. No wonder Last didn't link to any of the coverage.
It's absolutely true that no fraudulent voting had occurred when this was written. . . but since no voting had occurred, that's not much of a feat, now is it?
YOU WANT DIRTY TRICKS? VOILA! What made Jonathan Last's article -- which we commented on yesterday -- so breathtakingly dishonest wasn't just the way he fudged his examples, but the way he ignored the far greater evidence of Republican (or, at any rate, pro-Republican) dirty tricks in this election. We've already noted how South Dakota television reporters close to Republican John Thunetried to gin up a mostly bogus voter-fraud scandal, which was followed by the GOP sending voters a misleading flier saying that "Tim Johnson and the Democrats are hiding the truth about voter fraud" and conducting sleazy push-polls. But there's more. So much more.
Counterspin Centralhas a good roundup of stories on Florida, where the the national GOP has dumped millions of soft dollars via a process designed to turn it into "hard" money, which the Center for Public Integrity's Chuck Lewis describes as "money laundering." But wait! In a last-minute bid to dampen Bill McBride's turnout, Jeb Bush hasn't been averse to a little race-baiting, telling crowds that Al Sharpton and Jesse Jackson are in town campaigning for McBride. According to some early reports, voting machines in some areas will only register a vote for Bush (granted, this could easily be a computer glitch . . . but a very convenient one). Finally, Bush's government not only didn't provide enough machines for everyone to vote -- it recently refused to extent voting hours to make sure all votes are counted.
In Baltimore, somebody has been putting out fliers in black neighborhoods saying that election day is tomorrow, instead of today, and that people with unpaid parking tickets can't vote, which is a lie.
In Texas, two poll watchers from Republican John Cornyn's campaign were ejected from polling places after making racist remarks to some voters, aggressively confronting one elderly voter and otherwise talking to and harassing voters, none of which is permitted.
In New Hampshire, the GOP has put out gay-baiting phone calls to voters.
In Tennessee, the GOP is engaging in voter intimidation on a level not seen since Jim Crow. The Justice Departmenthas confirmed to local election officials that GOP poll-watchers have been instruced "to object when voters who registered under the motor-voter act show up to cast their ballots."
Tapped would love to know how high up these decisions get made. Perhaps this is just decentralized thuggery, with everybody on the same playbook. Republican campaigns don't need to be told to try and suppress the Democratic vote. But when the dust settles, this may go down as a throwback campaign -- the year Republicans, sensing the country moving away from them, decided to try and suppress votes rather than win them.
Well, these decisions don't get made, because:
1) That's not race baiting -- substitute Hilary Clinton for Jesse Jackson, and you'd get the crowd in just as much of an uproar. Isn't the idea that we may never, ever refer to blacks as real people, but only in the terms usually reserved for saints or sports heroes, a litttle, well, racist?
2) The television stations are now reporting that the reported Bush error was a hoax. There is, however, a reported failure to register Republican votes in several precincts that has not yet been debunked, although I expect it will be.
3) The failure to provide adequate voting machines in whichever counties don't have them is the responsibility of the Democratic canvassing boards, not the governor.
4) I dont' think either party's name exactly shines on the gay-baiting issue this election cycle, but anyway, that's neither fraud nor intimidation, but nasty election tactics that have been exploited by both parties.
5) That leaves us with one flier in Baltimore, which is execrable, but hardly rises to the level of organized thuggery. And the GOP instructed to challenge first time motor voters. But isn't that a logical group to challenge, since it represents a large group of people who are unlikely to show up at the polls, and therefore open to having their vote stolen?
I know the left wing half of the Blogosphere is going to take this as evidence that We Wuz Robbed. But honestly, if you follow elections at all, this stuff is petty, well within reasonable tactics -- or it's demonstrably false, like the Republican "roadblocks" in Florida in 2000. Meanwhile, the right is alleging fraud with equally thin evidence. Could we have a moratorium on hysterical charges that the other side is Evil! Evil! Evil! until we actually hear some, umm, proof?
I'm not so good at the math, but I think this means a one seat pickup for the Republicans. And I still think there's a good shot Chafee will then switch, throwing it back to the Dems. But we shall see.
I think Republicans are going to pick up a few seats in the house, because the base is mad. And I think the Dems are going to pick up a couple governorships, although not as many as we thought, again because the Republican base is mad. All in all, fascinating watching.
Perspective is Everything Found this item on the excellent MedPundit:
Shakedown: Members of of the Washington, D.C. area's largest health insurance company won't be able to use the Children's Hospital without paying a steeper price. The hospital balked at the company's efforts to squeeze them further:
"CareFirst started off the negotiation asking for a 12 percent decrease in rates," said Jody M. Burdell, a Children's vice president. "We asked for a 20 percent increase. CareFirst really needs to pay rates that are comparable to other managed care companies' rates."
The insurance company denies this account, but there's no reason to suspect the hospital of lying and every reason to expect the insurance company to try to save face in an effort to avoid losing subscribers. Carefirst made $92.4 million last year.
Sounds like a clear cut case of rapacious health care companies heartlessly trying to squeeze the hospitals for the benefit of their greedy shareholders, doesn't it? But then you look at the numbers. They've got about $2.5 billion in assets, and around $6 billion in annual revenue. That outrageous $92.4 million profit represents a profit margin of 1.5% annually, and a return on assets of about 3.6%. These are supermarket-chain type numbers -- a business renowned for its razor-thin margins and brutal competition, not to mention regular spates of bankruptcy. Not for its avaricious investors and plutocratic managers getting rich off the back of hard-working customers.
In other words, maybe the reason they're putting price pressure on their suppliers is that if they don't, they'll go out of business. Sidney Smith understandably sees the hospital's side -- but there are generally two sides to a story. Just goes to show how two people can look at the same situation and see entirely different things.
InstaPundit indicates that turnout may be unusually high. Which of course begs the question: Republican, Democrat, or both?
Well, I think the Democrats, who've historically done a lot better on soft money, are probably running a hell of a get-out the vote effort. And I think there's a big segment still nursing the wounds of Florida.
Problem is, I think the segment still nursing those wounds is also the segment that would vote if Mickey Mouse were the Democratic candidate. In other words, I don't doubt there's real passion, but I'm not sure it's actually going to appreciably up their vote.
On the other hand, based strictly on anectdotal evidence, the people voting against the Democrats are motivated as hell. Between Torricelli/Lautenberg, the war, and the Wellstone rally, people I know who generally only vote if they happen to stumble into their polling place while looking for a bathroom are making sure they get up early to register their disapproval of the Democratic Party. Which is shocking, because I'm living in DNC central. But perhaps I'm just noticing those because they're so out of the ordinary, and there's nothing really going on.
Mark Kleiman says that Broward voters are being effectively disenfranchised by the inadequate number of too-slow voting machines. I think he's exaggerating about the impact -- he estimates that 37% of voters could get through the system at the average speeds being clocked during early voting, which isn't really that far off from the average turnout in a midterm election. And we don't necessarily know that early voters are going at the same speed that election-day voters will -- they may be voting early because they're sick or something. But still, it seems like a big problem.
Feeling the way I do about voter fraud, I have to say I'm against substituting paper ballots, not because paper ballots are never acceptable, but because the fact is that they are susceptible to fraud, and because I find it unlikely that Broward could, at this late date, establish sufficient safeguards to maintain integrity of the system.
On the other hand, extended voting hours seem like a no-brainer. Although, to be fair I think you'd have to extend them all over the state. Which wouldn't necessarily help the Dems, overall. And it isn't fair to lay this all on Jeb Bush. He should allow the extended voting hours. But he didn't screw up Broward County's voting machines; the (heavily Democratic) Broward County commission did that themselves.
"I'm the first former car wash operator to be a U.S. senator," Barkley joked at a state Capitol press conference. He described his politics as "a little Wellstone, a little Rudy Boschwitz."
Barkley ran as an independent for the Senate in 1994 and 1996. He earned the then-Reform Party major status by his showing in the 1996 race. The Reform Party has since changed to the Independence Party.
Barkely said his first order of business would be to educate himself on spending bills awaiting Senate action.
"I have a lot of homework to do," he said.
Lacking either Democratic or Republican credentials, Barkley was asked with whom he would caucus in Washington.
"I'll do what I can do to help the people in the state of Minnesota," he responded. "I'll caucus by myself in a bathroom, if I have to."
I follow the Microsoft case with interest, of course, given my twin interests in economics and technology. So I descended on this Scott Rosenberg article on the settlement like a ton of bricks:
However, when it comes to the heart of the problem -- the way Microsoft chose to weave Internet Explorer code into the guts of Windows in a manner that served no conceivable user benefit but that helped Microsoft elbow Netscape out of the market -- the settlement as tweaked by Kollar-Kotelly simply wimps out. "The evidence does not indicate that the removal of software code is beneficial from an economic perspective. The Court also finds that the forced removal of software code from the Windows operating system will disrupt the industry, harming both ISVs [Independent Software Vendors] and consumers."
The argument here seems to be: Let's not tamper with the innards of Windows, because who knows what might happen then? It's not an unreasonable question -- except that, by refusing to dig into the code, Kollar-Kotelly ensures that the remedies provided by the settlement will be cosmetic. And as long as Microsoft remains the untrammeled master of the Windows code, it can still find ways to trip up potential competitors without ever having to resort to anything so crude as threats to "cut off their air supply" or demands that desktop icons be removed.
Kollar-Kotelly's decision is persuasive at the level of detail; it is in sum that it fails to support its conclusion that the proposed settlement is indeed "in the public interest" -- a certification that's required by an obscure law known as the Tunney Act.
What I think this means is, even though there's a high risk that we'll screw up the company/software that formed an important part of the economic boom of the nineties, and even though we don't know how we'd actually execute this tinkering, and even though the judges who are expected to rule on the matter are in no way qualified to decide what is or is not necessary in operating system software -- despite all this, we should do it anyway.
And why should we do this? Because Microsoft is mean.
Don't get me wrong; I share the non-unreasonable fear that without some restraint, in five years we'll all be renting air from Bill Gates. But let's look at the economic benefit we're supposed to be providing to consumers by breaking the company up. Remember them? They're the reason we have antitrust law -- not to protect engineers, marketing guys, or salespeople who work at a Microsoft competitors; not to make Mac afficionadoes feel better about themselves; not to provide journalists who make in the low five figures the satisfaction of seeing a big, rich company taken down. To protect consumers from companies who use their market power to force them to pay high prices for crap.
Oh, I know. You think Microsoft software is high-priced crap. But let's look at the immediate benefit consumers would derive from having Microsoft hamstrung by Justice.
Well, in the flowering of competition that comes after their main competitor has been hogtied and forbidden to compete by the Justice department, I think that all you antitrust types can agree that Macs aren't going to get any cheaper, nor will Unix boxes get any easier to use. Those being the primary barrier to the adoption of those platforms today.
[Thank you to all those who are even now mentally composing their angry notes. Yes, my little Linux geek, I know that you find unix heart-breakingly easy to install. But I work in technology, and I've worked with the major Linux boxes, so spare me the melodrama about how it's every bit as easy and fully supported as a Microsoft box. I could get seriously hurt laughing that hard. Yes, for a reasonably adept computer user, the switch to Unix isn't that hard. But the problem with Unix people is that due to their work environment, they seem totally unaware of the larger base of consumers who cannot be described as "reasonably adept", and cannot function without those dreadful little wizards, smiley faced cartoon characters, and extensive, idiot-friendly computer help lines provided by Wintel firms.
And you, my darling Mac hound, I am well aware that your Mac is a bargain with all its video software and neato music features and the smooth, white expanse of the outer case melding seamlessly into the hip new colors on the front. . . but for the millions of consumers who don't edit their own movies or collect 8 zillion tunes on their I-Pod, all that software you consider indispensable is useless dross for which you're asking them to pay a hefty fee. I know you love your Mac. But you have to accept the fact that not everyone else wants all the features you use. And they want features you don't use, like software titles and power for a cheaper price. The ability to accept that other people have differing opinions on lifestyle questions is one of the things that makes America great. So give peace a chance.]
There might be some benefit to consumers of Mac and Unix boxes. Microsoft's development will be essentially stopped for at least a couple of years while the court decides what they're allowed to do. As anyone who's worked in software development can tell you, this is going to screw up Microsoft's software six ways from Sunday, leading to even longer delays. In the interim, some companies might be forced to start developing for other platforms, although Mac fans, don't hold your breath for them to port corporate applications onto OSX.
So net benefit: consumers of Mac and Unix boxes probably get some more software. Offset by the fact that probably more people are going to have to buy computers that are more expensive, and in the case of Unix, harder to use. We might also, while Microsoft is in its straightjacket, see a flowering of entrepreneurial spirit producing hithertofore undreamed of software products for the consumer market. Of course, we also might not. Since the benefit is fairly tenuous, we need to weigh it against the cost.
Network Effects save companies money There are advantages to having everyone on the same platform. It reduces costs for software development, training, home/work interaction, support, and makes their hardware and other software cheaper. Getting rid of the monopoly gets rid of the network effects, which will have some drag on the economy. This is particularly a propos in the case of a natural monopoly, where forcing companies to amortize fixed development costs over a lower number of sales for each OS means that the price of both operating system and other software will probably rise.
Microsoft has a lot of shareholders Kill the company, and you kill their portfolios. But we're not going to kill the company, you say? Come on. If you're having this argument with me, odds are better than even that you're some kind of a tech person. So let's take your current project. Pretend you have a little company that produces, as it's main product, whatever it is you're working on. Now imagine that the government steps in and tells you that you're going to have to change it. They'll appoint a special master to tell you what you can and can't do. You have to explain everything to the special master, wait for him to digest it and come up with a plan, and then explain to him why his plan is idiotic. Then he has to make a new plan. This isn't his only job, you know. You wait, not allowed to write a single line of code while the review process is on. A year or two down the road, he comes back and tells you what you can and can't do -- and then you have to rip apart your project and start over with the totally new specifications. Think your company would still be in business long enough to get a new product to market?
Risk is not good for the economy Getting Justice intimately involved in the operation of Microsoft raises risk in two ways. It increases the uncertainty about the future of the software/hardware market, which means companies will likely slow investment. Since falling investment is one of the primary causes of the current recession, this is a major concern. Punishing Microsoft also has a chilling effect on companies, which may fear that aggressive pursuit of market share will gain them not profits, but punishment. This is likely to deter investment and entrepreneurship, though it's hard to quantify whether this effect will be small or large. However, in our current liability environment, anything that increases the legal risk in the market has to go down in the "loss" category. Especially since the lesson that would go out from a successful drastic remedy is that competitors that lose in the market can try to win on appeal. Please don't argue that Microsoft is somehow special -- whether or not it is uniquely mean, it is not unreasonable to think that both the winners and the losers will draw this conclusion from the lawsuit, given how prominently Microsoft's competitors featured in the anti-trust suit.
Consumers like Wintel I know you don't like Wintel, because you're a hard-core afficionado. But the great mass of consumers like their Windows PC, even though it isn't as powerful as Unix, or as nifty as the Mac. They like the combination of price and features that the platform offers them. Stalling development at Microsoft for four years isn't going to make them happier, especially since
The verdict will make the main alternatives less attractive, not more. By which I mean that absent competition from Microsoft, Mac and Unix providers are less likely to improve their offerings, especially on key metrics like price and user-friendliness. Sun has no consumer marketing apparatus to speak of, and is unlikely to develop one in time, much less a software package that can be maintained by granny in Dubuque. Linux suffers from the fatal problem of all open-source, which is that no one wants to spend two years building a little animated dog to tell Grandma how to install her printer. Meanwhile, Mac's main issues -- price and power -- are unlikely to improve, first because absent Microsoft, there is no price pressure, and second of all, because there are development cycle limitations on how fast Mac will be able to put out a comparably-powered machine even if it wants to. I know I'm going to get argument on this, but c'mon -- when has getting the government to kill the main competition ever improved anyone's product?
Innovation will stall both because of increased risk, and because Microsoft won't be able to do much of anything while Justice hammers out a remedy.
So look at the modest benefits, and compare them to the major costs. I repeat that you are not allowed to consider benefits to owners of companies that might be created or get more market share, because that's not what the law is designed to do; it's supposed to protect consumers, not corporations or even their employees.
Seems to me that the benefits are all out of proportion to the costs.
Rosenberg's argument is essentially "Yes, but if we look at the costs, we can't do anything about the scourge of Microsoft!"
Mmm-hmmm. And they think free-marketers are dogmatic?
You can get rid of the pain of a stubbed toe by amputating the toe. Or you can wait for the pain to go away. The one has the benefit of "doing something about the problem", with the drawback of being, y'know, catastrophic. The other one is boring, but ultimately less painful.
As a relatively pro-market force, I get a lot of email from regulatory fans, triumphantly pointing out some place where the market has produced some result other than the one we would have gotten in an ideal world full of sweetness and light. They then wait, smirking, I imagine, for my worldview to crumble as I realize that the markets are not, after all, perfect. I think they are disappointed when I respond with the adult equivalent of "Duh. You thought we lived in an ideal world full of sweetness and light?"
Sensible proponents of the free market do not believe that markets produce the ideal result -- only that it is more likely to do so than the entity that continues to bring us the National Strategic Helium Reserve.
So why can't proponents of regulation seem to realize the same thing -- that there is not some ideal combination of regulation that will ensure that nothing bad ever happens, anywhere? I recall with fondness a discussion I had with one of my lefty readers that started with his desire to really regulate those energy companies so that California couldn't happen again, and then, as I walked him through the issues of regulatory capture and conflict of interest inherent in asking a civil service guy making 70K to watch an industry making thousands of times that amount, his tunnel vision led him into an interesting place. With each proposed solution, as I pointed out the practical difficulties that would prevent his regulatory scheme from working the way he wanted, he began proposing more and more extreme solutions to overcome the practical difficulties, until he was left with two proposals:
1) Enact the reforms he wanted even though he agreed they wouldn't work, in the hopes that at some point down the road the voters would notice and do something about it. The problem being that this is an equally strong argument for not enacting the regulation, in hopes that at some point down the road, the voters would enact the perfect scheme he desired.
2) Rip out the entire civil-service system of California so you can pay regulators enough to avoid conflicts of interest A proposal breathtaking in both its utter impracticality, and blythe disregard for cost. It would be cheaper to give everyone in California their own generator than to go through the legislative and administrative battles necessary to enact this sort of reform.
When your automatic assumption is that there is some regulation, somewhere, which can produce a perfect result, you get so focused on your goal that you begin to make ludicrous suggestions for how the rest of us should drop everything and get to work on the problem you've identified.
So don't get mad when the rest of us ignore you in favor of getting on with our lives.
