Archive for February 2005

Chris Rock and the Academy Awards

Maybe it was just having really low expectations, but I thought Rock was OK last night, though .  Sure some of the stuff they did flopped (the skit with Adam Sandler comes to mind) but he was moderately funny and while he made fun of a number of people, he was pretty equal-opportunity about it.  And anyone who gets Sean Penn all huffy can't be all bad.  Sure the show may have less gravitas than when Carson hosted it, but compare it to where shows like the Grammy's have gone and it looks like Masterpiece Theater.  And if people want to talk about whether Rock was "serious" enough for the event, they should focus some attention on Al Pacino showing up looking like a k彩平台登陆less person or on Dustin Hoffman trying to present the Best Picture award drunk off his ass.

Other Notes:

  • Was the show producer sleeping with Beyoncé, or was she the only singer available?  Why did we see her three times?  And did all of the songs seem to be totally unmemorable or what?
  • The women's dresses were generally awsome, while their hair generally looked awful (or at least just dull, which is the same for a Hollywood-type).  I loved the return of those sort-of mermaid-shaped dresses.
  • Jamie Foxx was the highlight
  • Seeing Clint Eastwood with his young wife was an inspiration for all of us over-40 males.  Seeing his mom there was even more of an inspiration.

Carnival of the Capitalists

Welcomek彩平台登陆 to the .  Many thanks to for starting the Carnival of the Vanities, of which this is a spin-off, to showcase smaller blogs to a wider readership.  Look for future Carnivals of the Capitalists at these sites ():

March 7, 2005
March 14, 2005
March 21, 2005
March 28, 2005
April 4, 2005
April 11, 2005
April 18, 2005

While you're here, feel free to look around -- this post will tell you more about what I do at Coyote Blog.

For this week's Carnival, I have decided to take a bit of a risk, and, in true capitalist fashion, I have taken on a sponsor for this week's Carnival:

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More on the Press and Revealing Sources

In a previous post, I wrote:

There were two interesting court decisions today that each can be summarized as "the press does not have rights or legal privileges beyond those granted to any ordinary citizens"

A number of readers were confused by this, as we have always seen the brave reporter on TV or in the movies protecting their information sources under a "shield law".  Many states, but not all, do in fact have shield laws that give reporters some protection against revealing their sources of information under subpoena.  However, there is no such law at the federal level, and any state laws that exist do not apply to federal courts or subpoenas.

However, despite this lack of an explicit federal shield law, most media organizations argue that the Constitution confers such privilege on them anyway.  Per the:

[Judge Robert Sweet] explained that the United States Court of Appeals for the Second Circuit in New York recognized a qualified First Amendment privilege that protects reporters from being compelled to disclose their confidential sources

This confuses me - I have read the many times.  I see the stuff about freedom of the press.  I always naively assumed this meant that they had the freedom to publish any old bonehead thing they wanted, including criticism of the government, without any limitations by the state.  I never realized that this meant that they also had the freedom to evade subpoenas and cover up evidence of crimes, things the rest of us would go to jail for (e.g. Martha Stewart).  Does the fact that the same amendment refers to freedom of religion mean that priests can legally cover up wrongdoing?  Do freedom of speech protections mean that bloggers can hide sources from subpoenas?

I find the judge's logic, as reported by the Times, to be scary:

The judge, Robert Sweet, reasoned, correctly, that the subpoenas for the phone records were the functional equivalent of demanding testimony from the reporters themselves, and he took note of the important role of confidential sources in news investigations of the Watergate, Iran-contra, Monica Lewinsky and Abu Ghraib scandals.

In other words, the Judge thought that allowing the press to hide their sources was useful in some cases historically, so he created a new first amendment privilege.  This is the kid of action that irritates the heck out of me.  What the judge just did in this case is legislate.  He saw a need in society and created a new privilege for a class of citizens based on that need.  You may even agree with his logic - in fact, I may even agree in part with his logic - but it is not his job!  He should be saying: "I'm sorry, as useful as such a protection may be, I see no basis for it in federal law or in the Constitution.  If you think you need one, write your Congressman but for now, there is no such privilege".  UPDATE:  If judge Sweet needs an example, from an unrelated case:

U.S. District Judge Henry F. Floyd ruled Monday that the president of the United States does not have the authority to order Jose Padilla to be held indefinitely without being charged.

"If the law in its current state is found by the president to be insufficient to protect this country from terrorist plots, such as the one alleged here, then the president should prevail upon Congress to remedy the problem," he wrote. ()

Sounds a lot like my suggestion above, huh?  This strikes me as a good judicial practice - rule on the law as it is, rather than what you think it should be.  We actually don't know whether Judge Floyd thinks that it is a good idea for the President to be able to order terrorist suspects held indefinitely, nor should his opinion matter.

Another Update:  on yet another case of legislating from the bench.  I am lukewarm on the death penalty in general and am opposed the death penalty for minors, but I still think the Supreme Court is dangerously overstepping its bounds here.  The majority opinion talks about practices in other countries and public opinion - what does that have anything to do with Consitutionality? Those are arguments for legislation banning death penalty for minors in the legislature, not for the Court.

By the way, the Times wants to be able to keep secrets, but gets pretty huffy when other people have the same privilege:

Some judge may have looked at the issue, but we have no way of knowing, given the bizarre level of secrecy that still prevents the reporters being threatened with jail from seeing the nine-page blanked-out portion of last week's decision evaluating the evidence.

I found one other point in this same NY Times editorial to be hilarious.  I have not really commented on the Plame affair, because I found it to be pretty boring.  In fact, it is telling that most discussion of the affair ended the day after the elections.  Anyway, I found this note by the NY Times pretty funny:

Meanwhile, an even more basic issue has been raised in recent articles in The Washington Post and elsewhere: the real possibility that the disclosure of Ms. Plame's identity, while an abuse of power, may not have violated any law. Before any reporters are jailed, searching court review is needed to determine whether the facts indeed support a criminal prosecution under existing provisions of the law protecting the identities of covert operatives.

There is nothing wrong with this statement in and of itself - in fact, I agree.  Its funny only because the:

Officials are barred by law from disclosing the identities of Americans who work undercover for the C.I.A. That provision is intended to protect the security of operatives whose lives might be jeopardized if their identities are known.

Among those who have cried foul are several Democratic senators, including Charles E. Schumer of New York, who have said that if the accusation is true and if senior administration officials were its source, law enforcement authorities should seek to identify the officials who appeared to have violated the law. Mr. Schumer has asked Robert S. Mueller III, director of the Federal Bureau of Investigation, to look into the case.

The pointed out this even more telling statement from a .  Note the complete lack of uncertainty as to whether there was any crime committed (emphasis added)

The change was announced by the newly appointed Deputy Attorney General James Comey, who turned the case over to a respected career prosecutor, Patrick Fitzgerald, the United States attorney in Chicago. Mr. Fitzgerald is charged with finding out who violated federal law by giving the name of the undercover intelligence operative to Mr. Novak for publication in his column.

Interesting to see how their perspective changed when the subpoenas landed at their door.  "Law enforcement needs to get to the bottom of this as long as, err, they don't ask us to help".

I'm Confused by this Diversity Thing

For years, women at Harvard argued there needed to be more women on the faculty to support "diversity".  I have always thought that diversity meant that you had a lot of difference - in this case different kinds of people with different skills.  Now, Larry Summers is getting attacked by the female faculty for implying that women are, uhh, perhaps different from men.  Women are insisting that there is no justification for even studying the question of whether women are different than men.  They maintain that women are the same, no argument allowed.  But if they are the same, how is hiring more women contributing to diversity?

My guess is that the comeback of those involved is that women don't have a genetic difference from men, but they have a difference in perspective (political, philosophical, etc).  There are two obvious problems with this:

  • If what universities are really trying to achieve is a diversity of background, perspective, and political/philosophical viewpoints then why don't they hire for and measure diversity based on background, perspective, and political/philosophical viewpoints, rather than the imperfect proxy of black/white, man/woman, etc.
  • And, If what universities are really trying to achieve is a diversity of
    background, perspective, and political/philosophical viewpoints -- they are doing a really crappy job, because , at least in political viewpoint as compared to the population.

By the way, I was initially negative to Summer's comments myself here.  I still support my criticism that as a leader of a leading, in fact uniquely influential, educational institution, he has an obligation to his institution to be careful what he says.  A CEO today who speaks his mind on political issues is not only ill-advised, but may actually be violating his/her fiduciary responsibility by bringing public censure on the company's shareholders.

However, that said, the degree of hysteria over Summer's comments is mind-boggling, especially when you read what he actually said in context rather than just accept the media summary (basically, he did not say that men were better at math on average than women, he said that men MAY have a higher standard deviation in their skills, leading to a disproportionate number of men being both dolts and geniuses at math and science).  To some extent, the women driving this hysteria actually seem to be publicly reinforcing stereotypes of women being delicate (some silly woman actually said she almost fainted at Summer's remarks)  overly emotional (given their hysterical reaction) and, ironically enough, non-scientific (given the fact that no one has thought to take on Summers scientific query with ).

In my experience, a confident mature woman can make the average man feel bumbling and childish, and have an ability to rise above the fray to bring sanity to a confused situation.  Why can't the grown-ups among the female gender be heard in such arguments? Never mind, the first sentence answers the second.  Besides, I think most confident intelligent women are giving up on woman's organizations anyway.

Blogging is Light - Working on the Carnival of the Capitalists

You can .

My Experience Today with Newspapers and the Web

Its been a frustrating day dealing with the .  The day began pretty exciting as they had a today featuring .

Our first disappointment was the fact that the paper forgot to include my wife's web site in the article, giving readers no contact information in the article if they are interested in the purses.  Then we found that the link to her article in was wrong, and only produced an error.  Now, mistakes like this happen - I actually messed up a link to my wife's web site in this article, but I quickly fixed it when an alert reader noticed.  So I emailed the webmaster at the Republic, and, several hours later, I got an email saying something like "here is the correct link".  But the link online is still broken!  In the time they sent me the email with the correct link, they could have just fixed the link online.  Six hours later, it still is not fixed.  This strikes me as classic dead-tree journalism, thinking in terms of making corrections days or weeks later rather than in real time.

UPDATE:  Yea!  Link fixed.  Wonder if my sending them this blog post helped or if they were doing it anyway.

Kate Groves Handbags Featured in the Newspaper!

k彩平台登陆Kate Groves Handbags

Hey, look!  We are fashion-blogging here at Coyote Blog today (fellow Princetonian would be proud)

We are having fun today as my wife, , had her handmade handbags and purses featured in the weekend style section of the Arizona Republic today!

Of course, being the MSM, they forgot to put her web site in the article, but they.  Since they only keep the articles online for a week (server disk space must be expensive over there) we have cached . Kate's website with .

I Was Right

I predicted just a week ago that recent media credibility issues would lead to (misguided) calls for tighter credentialing and licensing of journalists:

I resisted the call by a number of web sites at the beginning of the
year to make predictions for 2005.  However, now I will make one:  We
will soon see calls to bring a tighter licensing or credentialing
system for journalists, similar to what we see for lawyers, doctors,
teachers, and, god help us, for beauticians
.  The proposals will be
nominally justified by improving ethics or similar laudable things,
but, like most credentialing systems, will be aimed not at those on the
inside but those on the outside.  At one time or another, teachers,
massage therapists, and hairdressers have all used licensing or
credentialing as a way to fight competition from upstart competitors,
often ones with new business models who don't have the same
trade-specific educational degrees the insiders have.

Hah, it didn't take a year - it only took a week.  Several commentators point out that those jumping all over the Jeff Gannon affair are effectively arguing for tighter credentialing.  From :

I also think that the people who are trying to inflate this into a big
issue are making a dreadful mistake. I eagerly await the reaction when
the White House responds to this criticism by requiring everyone who
attends a press briefing to make a full financial and sexual
disclosure, and starts rating news outlets as "real" or "fake"
according to bias. (If I were Rove I'd make some rumblings about this
to the press corps, and I'd explicitly cite the lefty bloggers by name,
just to stir up trouble . . . .)


There is a need for professional accreditation; space is limited. Yet
there is nothing inherently wrong with allowing journalists with
identifiable biases to pose questions to the White House press
secretary and even the president. And if such a reporter asks a dumb
question--as did Gannon/Guckert (which triggered this scandal)--the
best response is scorn and further debate. Bloggers should think hard
when they complain about standards for passes for White House press
briefings. Last year, political bloggers--many of whom have their own
biases and sometimes function as activists--sought credentials to the
Democratic and Republican conventions. That was a good thing. Why
shouldn't Josh Marshall, Glenn Reynolds, John Aravosis, or Markos
Moulitsas (DailyKos) be allowed to question Scott McClellan or George
W. Bush? Do we want only the MSMers to have this privilege?

I Would Be Thrilled to Admit I'm Wrong

From (via ):

The leader of this Lebanese intifada is Walid Jumblatt, the patriarch of the Druze Muslim community and, until recently, a man who accommodated Syria's occupation. But something snapped for Jumblatt last year, when the Syrians overruled the Lebanese constitution and forced the reelection of their front man in Lebanon, President Emile Lahoud. The old slogans about Arab nationalism turned to ashes in Jumblatt's mouth, and he and Hariri openly began to defy Damascus....

"It's strange for me to say it, but this process of change has started because of the American invasion of Iraq," explains Jumblatt. "I was cynical about Iraq. But when I saw the Iraqi people voting three weeks ago, 8 million of them, it was the start of a new Arab world." Jumblatt says this spark of democratic revolt is spreading. "The Syrian people, the Egyptian people, all say that something is changing. The Berlin Wall has fallen. We can see it."

I opposed the war in Iraq not because I thought there was any ethical problem in throwing out Saddam, but because it seemed to require an awful lot of time and energy and lives to overhaul one country.  I support a strong US role in the promotion of democracy, but given the long list of totalitarian states in the world, the approach in Iraq seemed inefficient.

However, my argument loses power if our efforts in Iraq start to cause spontaneous changes in other countries in the region.  To be fair, many made this very argument for the war, but I have been skeptical.  I would love to be proved wrong.

All Your Base Are Belong To Us

Update 6/23: Property rights lost 5-4.  More on Kelo decision here and here.  The arguments below are still valid, even if the SCOTUS did not agree.


Photo:  Welcomek彩平台登陆 to New London.  Note the small businesses, which will be happy to serve you until the town of New London takes their property away and gives it to someone they like better

brings us this telling exchange yesterday between the Court and New London attorney Horton:

Justice Antonin Scalia asks what difference it makes that New London is depressed. What if a city acknowledged that it wasn't doing badly, but just wanted to condemn land to attract new industry? He describes Horton's position as: "You can always take from A and give to B, so long as B is richer." And O'Connor offers this concrete example: What if there's a Motel 6 but the city thinks a Ritz-Carlton will generate more taxes? Is that OK?

Yes, says Horton.

"So you can always take from A and give to B if B pays more taxes?" asks Scalia.

"If they are significantly more taxes," says Horton

"But that will always happen. Unless it's a firehouse or a school," protests Kennedy.

The Court even gave New London's attorney a bit of a lesson on how free exchange of goods requires consent of both parties:

"We're paying for it!" Horton exclaims, noting that no one is taking anything from these minorities.

"But you're taking it from someone who doesn't want to sell. She doesn't want your money," retorts Scalia.

points out why Mr. Horton's payment will also be inadequate:

First, it fails to take into account the subjective valuations placed on the property by people whose families have lived on the land, in at least one case, for a 100 years. In other words, if the Supreme Court rules for the city, the government will be able to seize land at a price considerably below the reservation price of the owners. Second, unlike the prototypical eminent domain case, in which the land is seized to build, say, a school or road, in this case the city is using eminent domain to seize property that will then be turned over to a private developer. If this new development increases the value of the property, all of that value will be captured by the new owner, rather than the forced sellers. As a result, the city will have made itself richer (through higher taxes), and the developer richer, while leaving the forced sellers poorer in both subjective and objective senses

Read the whole thing, its depressing, all the more so since commentators seem to feel that New London will prevail.  To my eye, Mr Horton and New London look no different than Stalin-era Soviet planners.  The (sub. req'd)agrees:

Put simply, cities cannot take someone's house just because they think they can make better use of it. Otherwise, argues Scott Bullock, Mrs Kelo's lawyer, you end up destroying private property rights altogether. For if the sole yardstick is economic benefit, any house can be replaced at any time by a business or shop (because they usually produce more tax revenues). Moreover, if city governments can seize private property by claiming a public benefit which they themselves determine, where do they stop? If they decide it is in the public interest to encourage locally-owned shops, what would prevent them compulsorily closing megastores, or vice versa? This is central planning.

Plenty more commentary at Professor Bainbridge ( and ), Volokh ( and ), ,  and the .  The is defending the property owners and is at the forefront of this fight - win or lose, they deserve props for their efforts.

Postscript:  I generally don't like the arguments I see in some blogs that go like "why aren't the ___________ [fill in  with liberal or conservative] blogs addressing such-and-such issue?"  Blogs are intensely personal, and since most of us write them as a hobby, there are always going to be issues that just don't really get us fired up.  For example, though many libertarian bloggers expend numerous electrons on gun rights, the topic is generally a yawner for me so I seldom go there.

With that said, it is interesting to speculate where the "progressives" are on this case.  When you see a story of a city making a virtue of taking from poorer people to give to rich developers, one would expect the left to go nuts.  As reason describes it ( and and ):

... a growing number of governments are using eminent domain to circumvent the conventional real estate market. Eminent domain forces property owners to sell their property to the city while the city then turns around and sells the property to developers. Private developers can reap significant financial gains through this process. Reason finds these decisions are increasingly driven by local politics, not respect for property rights, and give well-connected property developers significant advantages over k彩平台登陆owners and small businesses.

Little guy vs. big guy -- where is the Left?  Well, the problem is that progressives generally support the erosion of private property rights.  They like cases that reinforce the ability of government and politicians to take, redirect, or otherwise control private property for their own goals.  In this case, I presume that they are willing to sacrifice a few little guys in Connecticut for the larger goal of increasing statism.

UPDATE:  Apparently the New London attorney ended on a note of mystery, according to :

The moment of the day came in Kelo when the city's counsel attempted to close by saying, "I want to leave you with just four words," then his time expired. (Although he did say -- using more words, "I see my time has expired so I won't be able to tell you them.") Justice Kennedy then asked the plaintiff's lawyer on rebuttal, "You don't happen to know what the four words were?" Regrettably, he didn't.

Here is my guess for New London's last four words: "Everything belongs to us".  Of course "" would have been better, but that is seven words.

Lessons for the UN from the American Civil War

The United Nations is broken -- this is beyond question.   The only thing left to argue about is if it is Worldcom-broken, where the basic business model is OK but the management is corrupt; or Internet-startup-broken, where the whole mission and business model is wrong.  I would contend that the answer is a little of both.

One of the sources of confusion in discussing the UN is that the organization has several very different missions.  These missions fall in roughly two categories:

  1. Distribution of aid and relief, including funds and training for education, public health, and poverty mitigation.
  2. Helping to manage relationships between nations and, sometimes, between nations and their people

The first mission, of administering aid, is , and would probably be fixable to some extent with better leadership in place.  Personally, I think much of the aid provided is well-intentioned but misguided.  Poverty generally results from corrupt, confiscatory, totalitarian regimes.  As a result, much of the aid (see ) gets siphoned off as graft by rulers, and the rest may alleviate some suffering but provides no long-term progress toward fixing the real problems the poor face.  However, given that so many people and nations feel conscience-bound to keep sending the aid, and given that some of the aid does in fact help, a cleaned-up UN is probably a reasonable vehicle for delivering it.

My main focus in this post, however, is on the second UN mission listed above, that of managing the relations between peoples and nations.  The fundamental problem is that we as Americans (rightly) expect the UN to carry a set of values into its dealings with nations that the majority of its member nations do not share.  Here, I am not even talking about contentious issues that even Western democracies might argue about (e.g. abortion, capital punishment) but the basics -- things like free elections, free expression, and free markets.  Just scan the , or, even more revealing, the list of countries on the (yep, you can bet that Sudan brings a lot of moral authority to that committee).  The UN is a dictators club.

The best analogy I can come up with is the United States in the decade before the Civil War.  Imagine that rather than being split 50/50, the majority of states in the US at the time supported slavery.  In those circumstances, how much chance would there be that the Congress would successfully pass a law outlawing slavery?  Right, none.  In the same way, it is unreasonable to expect a UN that is majority-controlled by totalitarians to take any meaningful steps to support freedom and plurality.

Until the Civil War, states in the South believed that the Constitution allowed them substantial, in fact near total, leeway in setting their own laws and standards.  While in a Federalist system this is always somewhat true, what the Civil War was really about was the United States establishing that there are certain minimum standards that member-states will be held to, even if enforcement of those standards requires the use of force.   Ever since, though states may vary in terms of tax rates and such, there are minimum standards that are non-negotiable  (though sometimes this gets carried away - was the 55 mile an hour speed limit really a necessary element of these minimum standards?)  The civil rights movement of the 1960's was another such time when the US enforced a minimum standard on its individual states.

Bringing this analogy back to the UN, the UN is weak because there are no minimum standards for membership.  An immoral nation alone is immoral.  A grouping of immoral nations is still immoral - the grouping does not confer any moral authority.  When the UN was founded, it was thought that having as many of the world's nations as possible as members would confer the maximum moral authority on the body, sort of like having a higher turnout in an election tends to increase the perceived mandate and legitimacy of the victors.  Its becoming increasingly clear, though, that having all the nations of the world, many of them dictatorships, as members is in fact destroying any moral authority and effectiveness the UN might have.

Since 9/11, the United States has adopted a dual foreign policy of fighting terrorism and promoting democracy around the world.  Most Americans support these goals, thought many disagree with any number of the tactics over the last several years.  In achieving these goals, it would be far better for the US to be able to pursue them as part of a coalition, an alliance for freedom and democracy, rather than on its own.  As has been made pretty clear, the UN is not going to be that vehicle.  It houses too many terrorists to ever agree to fight terrorists () and it encompasses too many totalitarians ever do anything meaningful to fight for individual rights (see , ).  Of course, this doesn't stop the UN from trying to take credit for progress made by others.

What is needed is a new organization with a core group of countries strongly committed to democracy that can act with greater moral authority than any single country but who will not be hamstrung by members who oppose strong interventions because they fear being the next target.  This article by shows encouraging steps in the right direction:

Since 1996, a handful of foreign-policy wonks have been kicking around the idea of a "democracy caucus" at the U.N. Two administrations, first Bill Clinton's and then George W. Bush's, took quiet but significant steps in that direction. Now, according to Bush administration officials, the concept will be test-flown at the six-week meeting of the U.N. Commission on Human Rights that began on Monday in Geneva.

He concludes:

"United Nations" is an oxymoron. Democracies and dictatorships are mongoose and cobra, with no real hope of uniting except opportunistically. But a community of democracies"”that might just work. It already works in NATO and the E.U. The new community is a fledgling, but many readers of this article may live to see it soar.

UPDATE:  By the way, a reader pointed out to me one other problem the UN has:  their mission has been perverted from one something like "working toward a more peaceful world" to "peace at all costs".  The problem with peace at all costs, and something the American left and many of my fellow libertarians need to do a gut-check on, is that if you seek peace above all else, it means that you are willing to live, literally, with anything else.  That can mean anything from living with genocide (Sudan) to living with totalitarianism (N. Korea) to living with sponsorship of terrorism (Iran, Syria). 

By the way, I will pre-empt the obvious straw man here:  opposing peace at all costs does not mean favoring war as a first option.  I approved of the war in Afghanistan, but .

My 11-Year-old on Freedom and America

My son had a class project to take pictures of things that represented the good things about America, as well as some of its problems.  He did it pretty much on his own, and I only really saw it when it was done.  Most pictures were pretty typical of such kids' products (a flag, statue of liberty, pretty mountains) while a couple were fairly typical of my son (of eleven pictures, two were of professional baseball stadiums).  There was one picture I thought, while probably the most prosaic, was, with his caption, the most powerful.  Though its a bit over-dramatic, I actually am pleased that he understands just how different other countries can be (grammar needs some work):


Caption:  "People sitting and eating and
joking around that is freedom, not being forced into a wall with a gun at your

Carnival of the Capitalists

The new Carnival of the Capitalists is up.

The host next week is....me!  Submissions should be sent via the .

Top 100 Gadgets of all Time

Mobile PC has a , from the swiss army knife to the pocket fisherman to the iPod.  Really cool idea for a list, and the authors range pretty far and wide for their selections.



In Praise of "Robber Barons"

After seeing a piece of my son's history curriculum at school, I realized for about the hundredth time just how poor an understanding most people have about the great industrialists of the 19th century, so unfairly painted as "robber barons".  While it is said that "history is written by the victors", I would observe that despite the fact that socialism and communism have been given a pretty good drubbing over the last 20 years, these statists still seem to be writing history.  How else to explain the fact that men who made fortunes through free, voluntary exchange of products can be called "robber barons"; while politicians who expropriate billions by force without permission from the most productive in society are called "progressive".

To be sure, capitalists of the 19th century sometimes played by rules very different from ours today, but in most cases those were the rules of the day and most of what they did was entirely legal.  Also to be sure, there were a number of men who were fat ticks on society, making money through fraud and manipulation rather than real wealth creation (Daniel Drew comes to mind).  However, most of the great industrialists of the 19th century made money by providing customers with a better, cheaper product.  In the rest of this post, I will look at two examples.

The first is Cornelius "Commodore" Vanderbilt, the person to whom the term robber baron was originally applied (by the New York Times, interestingly enough - some things never change).  While Vanderbilt is perhaps best known for his New York Central railroad, the term was actually applied to him earlier in life in his shipping days, where he made a fortune running steamships in and out of New York City.  Vanderbilt stood accused of overly predatory tactics in moving into rivals territories.  However, in 1859 Harpers Weekly observed (via by John Steele Gordon):

...the results in every case of the establishment of opposition lines by Vanderbilt has been the permanent reduction of fares.  Wherever he 'laid on' an opposition line, the fares were instantly reduced, and however the contest terminated, whether he bought out his opponents, as he often did, or they bought him out, the fares were never again raise to the old standard.  This great boon -- cheap travel-- this community owes mainly to Cornelius Vanderbilt". (sorry, no link available -- I guess they weren't putting their articles online in 1859)

In many ways, Vanderbilt was the of his day, and, just like with Southwest today, towns begged for him to serve them because they knew he would bring down rates.  In fact, there is actually another parallel with Southwest Airlines.  In the early days of Southwest, most of the airline industry was regulated such that new entrants competing at lower prices were pretty much excluded by government rules.  Southwest got around these rules by flying only in Texas, where interstate rules did not apply.  Their success in Texas was a large reason for the eventual demise of government regulation that effectively protected fat and inefficient incumbent airlines, with drastically lower fairs the result.

When Vanderbilt first entered the steamship business, most routes were given as exclusive charters to protected monopoly companies, most run by men with friends in the state government.  Vanderbilt took on the constitutionality of these government enforced monopolies and, with the help of Daniel Webster, won their case in the Supreme Court.  Within a decade, the horrible experiment with government monopoly charters was mostly over, much to the benefit of everyone.  While private monopolies have always proved themselves to be unstable and last only as long as the company provides top value to customers, publicly enforced monopolies can survive for years, despite any amount of corruption and incompetence.  Vanderbilt, by helping to kill these publicly enforced monopolies, did more than perhaps any other man in US history to help defeat entrenched monopolies, yet today most would call him a monopolist. 

By the way, there are two charges against Vanderbilt that partially stick.   Those are that he bribed legislators and that he sought out price fixing agreements with his competitors.  Both are true, but both need context. 

To understand the bribery, one has to recognize that NY state passed a law that you could not be convicted of bribery solely on the evidence of the other party involved in the bribe.  In other words, they effectively made bribery legal as long as you were smart enough to do it without witnesses.  The real corruption was in the NY legislature at the time.  While Vanderbilt's motives were likely not always pure, no one who understands the state of NY at the time would deny that Vanderbilt would have been gutted had he not pro-actively played the bribery game himself in Albany in self-defense.

The price-fixing charge is even easier to deal with in context - basically price fixing agreements were entirely legal at the time.  In fact, price-fixing has been thought necessary, particularly in transportation, by politicians of all stripes for centuries - remember as late as the 1970's we had government enforced price-fixing in railroads and airlines.  In the 1930's, on the entire economy.

My other featured industrialist here on hug-a-robber-baron day here at Coyote Blog is John D. Rockefeller.  At one point of time, Rockefeller controlled 90% of the refining capacity in the country via his Standard Oil trust.  He was and is often excoriated for his accumulation of wealth and market share in the oil business, but critics are hard-pressed to point to specifics of where his consumers were hurt.  Here are the facts, via

Standard Oil began in 1870, when kerosene cost 30 cents a gallon. By 1897, Rockefeller's scientists and managers had driven the price to under 6 cents per gallon, and many of his less-efficient competitors were out of business--including companies whose inferior grades of kerosene were prone to explosion and whose dangerous wares had depressed the demand for the product. Standard Oil did the same for petroleum: In a single decade, from 1880 to 1890, Rockefeller's consolidations helped drive petroleum prices down 61 percent while increasing output 393 percent.

(perhaps just in time for the Sperm Whale).

So Rockefeller grew because he had the lowest cost position in the industry, and was able to offer the lowest prices, and the country was hurt, how?  Sure, he drove competitors out of business at times through harsh tactics, but most of these folks were big boys who knew the rules and engaged in most of the same practices.  In fact, Rockefeller seldom ran competitors entirely out of business but rather put pressured on them until they sold out, usually on very fair terms.

From "Money, Greed, and Risk," author Charles Morris

An extraordinary combination of piratical entrepreneur and steady-handed corporate administrator, he achieved dominance primarily by being more farsighted, more technologically advanced, more ruthlessly focused on costs and efficiency than anyone else. When Rockefeller was consolidating the refining industry in the 1870s, for example, he simply invited competitors to his office and showed them his books. One refiner - who quickly sold out on favorable terms - was 'astounded' that Rockefeller could profitably sell kerosene at a price far below his own cost of production.   

More . In fact, many, many of these defeated competitors became millionaires in their own right with the appreciation of the Standard Oil stock they got in the merger.

Eventually the Standard Oil monopoly weakened as most private monopolies do.  Monopolies seldom if ever engage in the price-increase games everyone expects them to, but they do get risk averse and lose vitality over time without serious competition.  This indeed did happen to Standard Oil, and it missed a number of key market turns, such as the Texas oil boom.  By the time is was broken up under the Sherman anti-trust act, Standard's market share had already fallen to 60%.  As would be the case many times in history, the government acted on the economic "threat" of Standard Oil at the very time the market was already doing the job.

Ever since, people have expended a lot of unnecessary energy getting worried about bigness and monopolies in industry.  I always laugh when "progressives" decry the monopoly power of the oil industry to manage prices.  I worked for the oil industry in the 80s, and if they had the power to manage prices they sure were doing a crappy job of it.  If someone thinks that oil companies have been manipulating prices, they have to explain this chart to me.  If prices are manipulated at all, they look like they are being kept low and stable.

Another great example of monopoly paranoia is the near continuous Microsoft-bashing in the courts.  The most famous anti-trust case was the successful case by Netscape and numerous other Microsoft competitors attempting to kneecap Microsoft, nominally for monopolizing the browser market.  Now lets leave aside the obvious issue of just how consumers are getting hurt by being given a free browser by Microsoft.  The plaintiffs apparently successful argument (incredibly) was that through a series of technology and marketing moves, Microsoft prevented competition.  If that is so, if competing with Microsoft is so hard, then why are .

UPDATE:  Welcomek彩平台登陆 to the Greenwich Public Schools.  Thanks for linking me from your web site.  Despite my Arizona k彩平台登陆 today, I actually lived in Greenwich for a while growing up.  You can find other essays on capitalism and individual freedoms , who is much funnier than I am.  If you are looking for a stronger defense of free markets than you can find in most public schools, a good place to start is at the.

"Sin" Taxes Put Perverse Incentives on Government

The government has found over time that it is able to sell higher taxes to the voters on certain items if they can portray those items as representing some socially unwanted behavior. These are often called "sin" taxes. The justification for the tax in its beginning is as much about behavior control as revenue generation.  Taxes on cigarettes, alcoholic beverages and even gasoline and plastic grocery bags have all been justified in part by the logic that higher taxes will reduce consumption.

However, a funny thing happens on the way to the treasury.  Over time, government becomes dependent on the revenue from these taxes.  The government begins to suffer when the taxes have their original effect -- ie reducing consumption -- because then tax revenues drop.  The government ultimately finds itself in the odd position of resisting consumption drops or restructuring the tax so it no longer incentivizes reduced consumption so that it can protect its tax revenue collections.

Cigarettes are a great example.  In this article, via , from (simple registration required):

Big tobacco was supposed to come under harsh punishment for decades of deception when it acceded to a tort settlement seven years ago. Philip Morris, R.J.Reynolds, Lorillard and Brown & Williamson agreed to pay 46 states $206 billion over 25 years. This was their punishment for burying evidence of cigarettes' health risks.

But the much-maligned tobacco giants have subtly and shrewdly turned their penance into a windfall. Using that tort settlement, the big brands have hampered tiny cut-rate rivals and raised prices with near impunity. Since the case was settled, the big four have nearly doubled wholesale cigarette prices from a national average of $1.25 a pack (not counting excise taxes) in 1998 to $2.10 now. And they have a potent partner in this scheme: state governments, which have become addicted to tort-settlement payments, now running at $6 billion a year. A key feature of the Big Tobacco-and-state-government cartel: rules that levy tort-settlement costs on upstart cigarette companies, companies that were not even in existence when the tort was being committed.

So, a tax that was originally meant to punish supposed past wrong doing by cigarette makers is causing problems because it was... actually doing what it was supposed to by hurting those companies.  Lots of good stuff, I encourage you to read it all - basically state governments have gone from opponents of the cigarette companies to their partners.  Antarctic Liberation Front opponent Eliot Spitzer comes in for particular attention.

A second example I discussed comes from San Francisco, where a tax aimed at discouraging use of plastic garbage bags was modified so that it collected more money, but no longer discouraged use of plastic.

A third example comes to us via , which points out that California now is considering supplementing their gas tax with a per-vehicle-mile tax.  The gas tax was always effectively a per-vehicle-mile tax, since the amount of gas you used was proportional to the number of miles you drove.  And, of course, the gas tax is far easier to manage than a per-vehicle-mile tax (yes, coming soon, its the odometer auditors!)

So why a need for the new tax?  Well, it turns out that Californians are buying a lot of very fuel-efficient cars, including new hybrids, which reduces gas consumption and thus taxes.  Of course, this is EXACTLY what most people hope the gas tax is doing - helping to conserve gasoline and reduce emissions and incentivizing people to purchase efficient vehicles.  Now California is considering substituting a new tax that collects more money but provides no conservation incentives.

UPDATE:  Welcomek彩平台登陆 !  If you're looking to kill more time at work today, check out my rant on the recent New London eminent domain case in front of the Supreme Court titled "all your base are belong to us".

More on Private Conservation Efforts

As I wrote here, I think of environmental issues in two categories:

  1. Regulation of pollution and emissions that affect other people's property.  These regulations are essential to the maintenance of a system of strong private property rights.  Without them, we would all be in court every day suing each other for damage to our property or water or air on our land from neighboring lands. Of course, we can all argue about whether set limits are reasonable, and we do.
  2. Regulations of land use that effects only your own land.  This is a relatively new area of environmental law, ushered in by the Endangered Species act and various wetlands regulations.  These regulations say that even if your proposed land use doesn't create any emissions that affect anyone else, the government may still ban your land use for some other environmentally related goal (habitat, watershed, anti-sprawl, the list is endless). 

These land-use laws constitute by far the most distressing area to me in environmental law.  In the worst cases, these laws can result in what are effectively 100% takings of a person's land without any compensation. (Example:  you buy a lot on the ocean for $500,000 to build a beach house.  Before you can build it, new regulations are passed making it illegal for you to build a house on that land.  Yes, you still own the land, but it is now worthless to you since you cannot use or develop it).  (pdf) and a listing of .

The government is of necessity involved in #1, though we can argue that some regulatory structures are more efficient than others (e.g. trading vs. command and control).  Government involvement in #2 is often a mess, and is one reason why private conservation groups and land trusts have made so much headway.

Reason has recently released a fairly that goes into much more detail on this topic.

Audit Blogging

Hey, this may be a first -- audit blogging.  I have an auditor from the Washington Department of Revenue in my office right now auditing my last two years sales tax returns.  She's a nice lady and so far the interaction has been pleasant.

Here is the funny thing - she has spent about 3 hours now trying to figure out what tax rates should apply at my various locations, and she is still at it.  I have written several times about the complexity of WA state sales tax variations for lodging, and how they vary by geography (here and here).  OK, if your experienced auditor has to spend hours in frustration trying to figure out what tax applies, the system is too complicated.

Update:  At halftime I am ahead, with WA owing me $800.  Stay tuned.

UPDATE #2:  Small potential setback in the 3rd quarter.  Several years ago I shifted assets (vehicles) I had bought in Arizona and used for years in Arizona to Washington for operations there.  The auditor suggested I may owe use tax on the vehicles in WA.  Huh?  Use tax drives me up a tree in general, but this seems really crazy.  WA is hyper sensitive to this issue because they have high sales taxes and very high vehicle registration fees and neighboring Oregon has not sales tax and lower registration fees.

Its Kyoto Day

Today (OK, its the 16th now, so yesterday) is apparently the .  You can find examples of my skepticism about the costs and benefits of the Kyoto treaty here.  I won't go back over all that stuff here.

The Washington Post article linked above includes the usual misstatements about global warming, and .  I particularly liked this line (emphasis mine):

...by uniting the vast majority of the world's nations, Kyoto could equally be the harbinger of an international model that rewards pollution-cutting innovation and pushes countries and companies to pursue cleaner forms of growth

The implication being that the US is the odd man out of a global consensus.  But then read further:

The pact, ratified by 141 nations, limits emissions from 35 industrialized countries

See the consensus problem?  Yes 141 nations ratified it, but only because 106 of them didn't have to do anything and were exempt.  In fact, they were exempted because the framers of the treaty knew that these countries would not ratify the treaty unless they were exempt. 

I also enjoyed the implication in the article that America's withdrawal from the treaty is solely based on the stand of President Bush.  You very seldom see any mention that the until it was substantially amended, changes that have never been made to the treaty and never will be.  This occurred years before GWB became president.

The Media Does Not Have Extra Rights

There were two interesting court decisions today that each can be summarized as "the press does not have rights or legal privileges beyond those granted to any ordinary citizens"

to allow subpoena's of reporters about their sources in the Valerie Plame affair.

Appellants counter that Justice Powell could not have meant what the United States argues, as this would have given reporters no more protection than other citizens. However, they never make it clear why they are convinced that Justice Powell must have intended to give reporters more protection than other citizens. The Constitution protects all citizens, and there is no reason to believe that Justice Powell intended to elevate the journalistic class above the rest.

.  I can't resist one quote from him:

And on its own, the DC Circuit's lengthy
today is absolutely fascinating for hard-core law wonks, especially
ex-judicial clerks. Indeed, I feel the urge to write several thousand
words about it "” dry quotes from the written opinions, connected by an
over-extended football metaphor, leavened with dollops of snark.


, where the state court determined that two Baltimore Sun reporters do not have the guaranteed right to a level of access to government officials and information beyond that given to a private decision.  As a citizen of that state, I might want to punish my elected representative at the polls if I thought they were trying to stifle criticism by managing the press poll too much; however, I agree with the court that the paper is not owed any legal redress.

I am sure we will hear cries tomorrow from editors about growing threats to the first amendment.  Don't be confused: These decisions are about press privilege, not press freedom.  Neither you nor I can ignore a federal subpoena, and neither should a reporter.

If you want to worry about the first amendment, :

The survey of 112,003 students finds that 36% believe newspapers should get "government approval" of stories before publishing.


Prediction: Media Insiders Call for Liscencing

Note:  the following post grew out of an update to this post -- I have not pulled it out into its own post.

I resisted the call by a number of web sites at the beginning of the year to make predictions for 2005.  However, now I will make one:  We will soon see calls to bring a tighter licensing or credentialing system for journalists, similar to what we see for lawyers, doctors, teachers, and, god help us, for beauticians.  The proposals will be nominally justified by improving ethics or similar laudable things, but, like most credentialing systems, will be aimed not at those on the inside but those on the outside.  At one time or another, teachers, massage therapists, and hairdressers have all used licensing or credentialing as a way to fight competition from upstart competitors, often ones with new business models who don't have the same trade-specific educational degrees the insiders have.  As Milton Friedman said:

The justification offered [for licensing] is always the same: to protect the consumer. However, the reason is demonstrated by observing who lobbies at the state legislature for the imposition or strengthening of licensure. The lobbyists are invariably representatives of the occupation in question rather than of the customers. True enough, plumbers presumably know better than anyone else what their customers need to be protected against. However, it is hard to regard altruistic concern for their customers as the primary motive behind their determined efforts to get legal power to decide who may be a plumber.

Such credentialing can provide a powerful comeback for industry insiders under attack.  Teachers, for example, ).  So, next time the MSM is under attack from the blogosphere, rather than address the issues, they can say that is just a college professor and isn't even a licensed journalist.

Fortunately, this effort will fail, in part because it is fighting the tide of history and in part because constitutional speech protections would probably invalidate any strong form of licensing (I wish there were similarly strong commerce protections in the Constitution).  Be careful, though, not to argue that this proposal will fail because the idea is stupid, because it can't be any more stupid than of licensing (or ;  or ).  Here are the various you need here in Scottsdale - I would hate to see the list for some place like Santa Monica.  My favorite is the one that says "An additional license is required for those firms which are going out of business."

Market Segmentation by Browser Type

In this post, I was surprised at the high share that Firefox has with Coyote Blog readers.  Looking into this further, I have found the high (30+%) Firefox share to be pretty stable over time.  However, I have a second Sitemeter account that tracks the cumulative stats for all my camping and recreation related sites of my business.  These visitors are much less likely to be computer-savvy, and the browser shares demonstrate this:

Coyote Blog Readers:

k彩平台登陆Coyote Browsers

Recreation Site Visitors:


Not sure I really had a point here, but it is an interesting difference.

I Don't Understand "Off the Record"

I haven't blogged at all about the whole thing, partially because blogging on it would be like adding one extra reporter to the Superbowl, and partially because his comments, while way out of line for head of a journalism organization, didn't seem to be much worse than all the other things he has said over time.

Anyway, I mention it here because whether his comments were "off the record" .  I can't think of any ethical justification for this distinction.  I can understand when comments are "private" (say with my family around my house) or "confidential" (say with my managers about what we are paying someone) or even "anonymous" (such as when a source might be blowing the whistle on their boss).  What, though, does it mean if public comments in a public forum are "off the record"?

The only practical, rather than ethical, justification I can come up with is that someone wants their remarks to be "off the record" when they are telling one audience something different than another audience.  Such as when a politician speaks radically to his/her hard left or right base, but doesn't want moderate voters to hear the extreme positions they are advocating.  Or such as when a US news director makes anti-American comments to an anti-American audience and doesn't want his US viewers to hear.  There is nothing very pretty about either of these situations - why does the media continue to enable this behavior?

The only other argument I can come up with is that the media tends to be so incompetent that they can seldom summarize a speaker's remarks correctly or quote them in context, and speakers know this, so they use "off the record" to protect themselves from the media's incompetence.  But if this is the true justification for "off the record", it is ironic and funny to see the head of CNN news using it.  He is basically saying that "I know in advance that my own organization will get my remarks wrong so I won't allow them to quote me".

UPDATE and PREDICTION:  I resisted the call by a number of web sites at the beginning of the year to make predictions for 2005.  However, now I will make one:  We will soon see calls, from media insiders, to bring a tighter licensing or credentialing system for journalists, similar to what we see for lawyers, doctors, teachers, and, god help us, for beauticians.  The proposals will be nominally justified by improving ethics or similar laudable things, but, like most credentialing systems, will be aimed not at those on the inside but those on the outside.  At one time or another, teachers, massage therapists, and hairdressers have all used licensing or credentialing as a way to fight competition from upstart competitors, often ones with new business models who don't have the same trade-specific educational degrees the insiders have.  As Milton Friedman said:

The justification offered [for licensing] is always the same: to protect the consumer. However, the reason is demonstrated by observing who lobbies at the state legislature for the imposition or strengthening of licensure. The lobbyists are invariably representatives of the occupation in question rather than of the customers. True enough, plumbers presumably know better than anyone else what their customers need to be protected against. However, it is hard to regard altruistic concern for their customers as the primary motive behind their determined efforts to get legal power to decide who may be a plumber.

Such credentialing can provide a powerful comeback for industry insiders under attack.  Teachers, for example, ).  So, next time the MSM is under attack from the blogosphere, rather than address the issues, they can say that is just a college professor and isn't even a licensed journalist.

Fortunately, this effort will fail, in part because it is fighting the tide of history and in part because constitutional speech protections would probably invalidate any strong form of licensing (I wish there were similarly strong commerce protections in the Constitution).  Be careful, though, not to argue that this proposal will fail because the idea is stupid, because it can't be any more stupid than of licensing (or ;  or ).  Here are the various you need here in Scottsdale - I would hate to see the list for some place like Santa Monica.  My favorite is the one that says "An additional license is required for those firms which are going out of business."

Happy Florist and Restaurant Profitability Day!

I am not a Scrooge on most holidays - heck, we even decorate our house for July 4, not to mention Halloween and Christmas.  However, I feel about the same guilt in not celebrating Valentines Day as I do not having kitchen floors as minty-fresh as the ones in the Pine-Sol commercial.

When I was single, I used to love Valentines Day.  Often it was a great excuse to get my girlfriend all romantic and full of wine, and, well, you know.   One year when I was in business school and was sans g/f, I secretly left  a red rose on the desk of every female in my section.

Since I have been married, though, Valentines has been one of those sort of grim opportunities to screw-up, like anniversaries.  For the married person, Valentines is all down-side.  Yes, I know a few couples who have developed some Valentines rituals with which they seem to have a lot of fun (power to them), but my wife and I never have particularly bonded with the day.  This year, my wife and I swore off the flowers (its much more money to apply the money to roses some day she is not expecting them) and had a nice lunch al fresco on a beautiful Phoenix day.  So I guess it wasn't so bad after all.

9/11 Conspiracies

has a very readable debunking of many of the most prevalent 9/11 conspiracies.  I am sure conspiracy theorists will generally respond to most of the scientists quoted with the all-encompassing "they're in on it!"  Once you get so many people giving evidence that the conspiracies are incorrect, you drive the conspiracy into the realm of Meyer's Law:

When the same set of facts can be explained equally well by

  1. A massive conspiracy coordinated without a single leak between hundreds or even thousands of people    -OR -
  2. Sustained stupidity, ignorance and/or incompetence

Assume stupidity.

In this case, the word stupidity is unfair.  The 9/11 attacks fall into the category of the "unimagined".  Frank Borman (as portrayed in the awesome mini-series "", I have not been able to find out if they used his actual words) is speaking to a committee hearing on the Apollo 1 fire that killed three astronauts.  Under intense scrutiny for a set of conditions that in retrospect seemed ridiculously unsafe, Borman described the problem as "a failure of imagination". 

In this case, for example, conspiracy theorists ask why no military plane intercepted the aircraft.  First, I would argue that without any prior precedent, no military commander or politician would have the cajones to shoot down a planeload of innocents on a commercial airliner (now THAT would be conspiracy fodder, had it happened).  Second, though, the article quotes a number of military commanders to say that the US didn't really have the radar coverage or aircraft patrols in place to intercept an airplane attacking from within the country - everyone previously imagined the threat to come from outside our borders, and that is how our defenses were arrayed.

Anyway, read the who article - it is an entertaining roundup of conspiracy theories (people do have good imaginations) and a well-argued debunking of them.  (via )