Posts tagged ‘CNN’

SopranoCare

Via the Daily Caller:

The White House is pressuring insurance companies not to speak publicly about Obama administration policies that could eliminate the existing health insurance plans of millions of Americans.

The administration made “clarifications” to the 2010 Affordable Care Act after it was passed that have already wiped out hundreds of thousands of existing health plans.

“Basically, if you speak out, if you’re quoted, you’re going to get a call from the White House, pressure to be quiet,” said CNN investigative reporter Drew Griffin on Anderson Cooper 360 Wednesday night. Insurance companies executives, Griffin said, ask heads of consulting firms not to criticize the Obamacare rollout debacle publicly.

“They feel defenseless before the White House P.R. team,” Griffin said. “The sources said they fear White House retribution.”

Prior to the Obamacare rollout, insurance companies issued warnings to the White House about the possibility of mass cancellations, which the administration ignored.

As has become usual of late, Jay Carney channels Ron Ziegler with this absurd answer.  Apparently, the fact that insurance companies are still engaged in routine conversations with their customers proves they have not been silenced from publicly criticizing Obamacare.

White House press secretary Jay Carney, however, waved off the allegations.

“That accusation is preposterous and inaccurate,” Carney said. “Plus, it ignores the fact that every day, insurance companies are out talking about the law, in large part because they are trying to reach new customers who will now have new, affordable insurance options available from providers through the new marketplaces.”

Seriously, Media Cannot Find Cost to Closure Beyond Parks

I wrote earlier that the only downside the AP could find with the looming shutdown were National Park closures.  I am not exaggerating.  It is the only thing they have.  Here is the CNN site about 45 minutes before midnight.  I added the red arrow

cnn-screen

 

As I wrote earlier, the only other function the 800,000 to-be-furloughed government employees seem to have is drawing a paycheck. Clicking on the article above the parks article entitled "multibillion$$ hit", we find absolutely no hint that these employees do anything of economic value or that their lost work will hurt the economy.   The only thing that they apparently usefully do is spend tax money

A government shutdown could cost the still-struggling U.S. economy roughly $1 billion a week in pay lost by furloughed federal workers. And that's only the tip of the iceberg....

The total economic impact is likely to be at least 10 times greater than the simple calculation of wages lost by federal workers, said Brian Kessler, economist with Moody's Analytics. His firm estimates that a three to four week shutdown will cost the economy about $55 billion.

Really?  There is a 10x Keynesian multiplier on these people's paychecks?   I would sure love to see what kinds of stuff they spend money on because I have never heard of a number that absurdly high.

What else can they think of to worry about beyond these lost paychecks?  Only one other specific is mentioned in the article.  Get ready for it -- the national parks will close!

Many federal contractors will also have to cut back on staffing if they don't get the business they normally do from the government. There's also a large variety of businesses that depend on the government to conduct their normal operations -- tourism businessesthat depend on national parks staying open, for example.

So there you have it.  The government shutdown does two things:  It closes the national parks and lays off 800,000 people who apparently do no valuable work (other than keep parks open!) but who have the highest Keynesian multipliers on their spending of any individuals in the nation.

Cable Unbundling Will Reduce Niche Channel Choices

I wish I could remember where I read this to give proper credit, but it is funny that the folks who are absolutely bending over backwards to bundle health care want to unbundle cable TV.  Think about it -- the person who just wants MSNBC but has to buy the whole cable package to get it is getting hosed far less badly than the young person next year who needs no medical care but will have to buy a pre-paid medical plan designed for a 65-year-old.

But I believe that cable unbundling will achieve the opposite effect from what most people expect.  And the key to my analysis rests, as do all important economic issues, on the difference between average and at the margin.  This is a repost from 2007

[A la Carte cable pricing] will reduce the number of interesting niche choices on cable.

For some reason, it is terribly hard to convince people of this.  In fact, supporters of this regulation argue just the opposite.  They argue that this is a better plan for folks who only are passionate about, say, the kite-flying channel, because they only have to pay for the channel they want rather than all of basic cable to get this one station.   This is a fine theory, but it only works if the kite-flying channel still exists in the new regulatory regime.  Let me explain.

Clearly the kite-flying channel serves a niche market.  Not that many people are going to be interested enough in kite flying alone to pay $5 a month for it.  But despite this niche status, it may well make sense for the cable companies to add it to their basic package.  Remember that the basic package already attracts the heart of the market.  Between CNN and ESPN and the Discovery Channel and the History Channel, etc., the majority of the market already sees enough value in the package to sign on.

Let's say the cable company wants to add a channel to their basic package, and they have two choices.  They have a sports channel they could add (let's say there are already 5 other sports channels in the package) or they can add the Kite-flying channel.  Far more people are likely to watch the sports channel than the kite flying channel.  But in the current pricing regime, this is not necessarily what matters to the cable company.  Their concern is to get more people to sign up for the cable TV.  And it may be that everyone who could possibly be attracted to sports is already a subscriber, and a sixth sports channel would not attract any new subscribers.  It is entirely possible that a niche channel like the kite-flying channel will actually bring more incremental subscribers to the basic package than another sports channel, and thus be a more attractive addition to the basic package for the cable company.

But now let's look at the situation if a la carte pricing was required.  In this situation, individual channels don't support the package, but must stand on their own and earn revenue.  The cable company's decision-making on adding an extra channel is going to be very different in this world.  In this scenario, they are going to compare the new sports channel with the Kite-flying channel based on how many people will sign up and pay for that standalone channel.  And in this case, a sixth (and probably seventh and eighth and ninth) sports channel is going to look better to them than the Kite-flying channel.   Niche channels that were added to bring greater reach to their basic cable package are going to be dropped in favor of more of what appeals to the majority.

I think about this all the time when I scan the dial on Sirius radio, which sells its services as one package rather than a la carte.  There are several stations that I always wonder, "does anyone listen to that?"  But Sirius doesn't need another channel for the majority out at #300 -- they need channels that will bring new niche audiences to the package.  So an Egyptian reggae channel may be more valuable as the 301st offering than a 20th sports channel.  This is what we may very likely be giving up if we continue down this road of regulating away cable package pricing.  Yeah, in a la carte pricing people who want just the kite-flying channel will pay less for it, but will it still be available?

Note the key to this analysis is the limited channel capacity of cable or satellite.  This is not a pure free market, where there is always room for another niche offering to try their hand with consumers.   Cable channels are more like products competing for limited floor space at Costco - to make the cut in an a la carte world, a channel has to do a lot of business.

That Whole "Banality of Evil" Thing

I can't help thinking of Adolf Eichmann when I look at 1) our Elvis-impersonating terrorist who thinks the local hospital is hoarding body parts and 2) the Chechnyan Beavis and Butthead who managed to kill and maim scores of people despite being bigger screwups than the entire Reservoir Dogs gang.

Don't let your freedoms be taken away by people who say such and such a place or event is vulnerable or open to attack.  If these guys can successfully terrorize people, there can't be any way to stop serious threats short of a North Korean police state.  Every occasion and location is theoretically vulnerable.  Our best protection is to build a society that eschews violence.  And, when someone does go off the farm, we want a society where there is no general toleration for the act.  In Chechnya or Syria or Iraq, these two boneheads would likely have found help and protection from some percentage of the population.  Not so in Boston, or anywhere else in America.

PS-  Today must have been CNN's wet dream.  This was like a real-life version of the Running Man (the enjoyable Richard Bachman aka Steven King book, not the awful movie), with similarly high ratings.

You Are In the Best of Hands

Rampant theft at the TSA

A former Transportation Security Administration agent who spent three years in jail for stealing from passenger luggage told ABC News that the practice “was very commonplace.” Pythias Brown, who worked at Newark International Airport, said he stole more than $800,000 worth of goods from luggage and security checkpoints. He was finally caught when he tried to sell a stolen CNN camera on eBay but forgot to take off all the stickers that tied the camera to the news network.

"It became so easy, I got complacent," Brown said. Almost 400 TSA officers have been fired for stealing from passengers over the past decade.

My assumption is that if they caught 400 with enough evidence to survive civil service grievance procedures, at least 4000 must be stealing. It's like Goodfella's II.

Just How Little Does Government Trust Individuals?

From CNN via Carpe Diem

 

A 24-year scandal was quietly acknowledged last week. On July 3 the U.S. Food and Drug Administration approved the first "rapid home" test for HIV—a test that people can take in the privacy of their own homes to determine whether they have the virus that causes AIDS.

The approval is an unambiguously good thing—or so you would think. The saliva test in question, made by OraSure Technologies and known as OraQuick, costs less than $60 and takes just 20 minutes to self-administer. According to statistics an FDA advisory committee presented at a hearing in May, it holds the potential to prevent the transmission of more than 4,000 new HIV infections in its first year of use alone. That would be about 8 percent of the roughly 50,000 new infections we currently see annually in the United States. (About 1.2 million people in the U.S. are now living with HIV, according to the Centers for Disease Control and Prevention, of whom about 20 percent don't realize they have it. Since the epidemic began in the early 1980s, about 1.1 million people have been diagnosed with AIDS, and more than 619,000 have died from it.)

The scandal is that the approval of a rapid home test for HIV did not occur until last week—about 24 years after the FDA received its first application seeking permission to market one.

Apparently, for years, even decades, only tests of clinical options were allowed to proceed, basically because the government considers Americans to be infants:

There was great concern that the patient receive proper counseling, both before and after the test. The patient needed to appreciate the possibility of false positives, so he wouldn't panic unnecessarily if he got one. He needed to appreciate the danger of false negatives, so he wouldn't become reckless, endangering sexual partners. And he needed to understand the options and support groups available in the event he received a true positive. (On top of all these concerns, many AIDS activists at the time were opposed to almost any form of HIV testing out of fear that results could be used to ostracize and persecute HIV-positive people—though one hopes that public health concerns were paramount to the FDA, rather than political pressure and hysteria.)

We Can't Spy Internally With the CIA, So We Will Use the Fed

Tyler Durden finds a creepy RFP at the Fed:

the Federal Reserve Bank of the United States, ... in a Request for Proposals filed to companies that are Fed vendors, is requesting the creation of a "Social Listening Platformwhose function is to "gather data from various social media outlets and news sources." It will "monitor billions of conversations and generate text analytics based on predefined criteria." The Fed's desired product should be able to "determine the sentiment [ED:LOL] of a speaker or writer with respect to some topic or document"... "The solution must be able to gather data from the primary social media platforms – Facebook, Twitter, Blogs, Forums and YouTube. It should also be able to aggregate data from various media outlets such as: CNN, WSJ, Factiva etc." Most importantly, the "Listening Platform" should be able to "Handle crisis situations, Continuously monitor conversations, and Identify and reach out to key bloggers and influencers."

Cable Unbundling

Megan McArdle responds to yet another call for government-enforced unbundling (or a la carte pricing) for cable TV.  I think she does a pretty good job in response, but I wanted to go in depth on a couple of issues.

First, it is interesting to me that the exact same people, typically on the Left, who want to unbundle cable TV are the same ones who angle for net neutrality, which in effect is government rules to enforce bundling of Internet services.  Which leads me to think this has less to do with consumer protection and more to do with the raw exercise of power to overturn free market solutions to problems.

Second, I think that unbundling would be a terrible solution for customers, particularly for those whose interests are focused and esoteric (e.g, they like the GLBT channel or whatever).  These folks think unblundling will get them cheaper rates for the one channel they want.  What it more likely will get them is fewer of those niche, esoteric channels.  I will simply repeat an earlier article I wrote four years ago on this topic:

I see that the drive to force cable companies to offer their basic cable package a la carte rather than as a bundle is gaining steam again.  This is the dumbest regulatory step imaginable, and will reduce the number of interesting niche choices on cable.

For some reason, it is terribly hard to convince people of this.  In fact, supporters of this regulation argue just the opposite.  They argue that this is a better plan for folks who only are passionate about, say, the kite-flying channel, because they only have to pay for the channel they want rather than all of basic cable to get this one station.   This is a fine theory, but it only works if the kite-flying channel still exists in the new regulatory regime.  Let me explain.

Clearly the kite-flying channel serves a niche market.  Not that many people are going to be interested enough in kite flying alone to pay $5 a month for it.  But despite this niche status, it may well make sense for the cable companies to add it to their basic package.  Remember that the basic package already attracts the heart of the market.  Between CNN and ESPN and the Discovery Channel and the History Channel, etc., the majority of the market already sees enough value in the package to sign on.

Let’s say the cable company wants to add a channel to their basic package, and they have two choices.  They have a sports channel they could add (let’s say there are already 5 other sports channels in the package) or they can add the Kite-flying channel.  Far more people are likely to watch the sports channel than the kite flying channel.  But in the current pricing regime, this is not necessarily what matters to the cable company.  Their concern is to get more people to sign up for the cable TV.  And it may be that everyone who could possibly be attracted to sports is already a subscriber, and a sixth sports channel would not attract any new subscribers.  It is entirely possible that a niche channel like the kite-flying channel will actually bring more incremental subscribers to the basic package than another sports channel, and thus be a more attractive addition to the basic package for the cable company.

But now let’s look at the situation if a la carte pricing was required.  In this situation, individual channels don’t support the package, but must stand on their own and earn revenue.  The cable company’s decision-making on adding an extra channel is going to be very different in this world.  In this scenario, they are going to compare the new sports channel with the Kite-flying channel based on how many people will sign up and pay for that standalone channel.  And in this case, a sixth (and probably seventh and eighth and ninth) sports channel is going to look better to them than the Kite-flying channel.   Niche channels that were added to bring greater reach to their basic cable package are going to be dropped in favor of more of what appeals to the majority.

I think about this all the time when I scan the dial on Sirius radio, which sells its services as one package rather than a la carte.  There are several stations that I always wonder, "does anyone listen to that?"  But Sirius doesn’t need another channel for the majority out at #300 — they need channels that will bring new niche audiences to the package.  So an Egyptian reggae channel may be more valuable as the 301st offering than a 20th sports channel.  This is what we may very likely be giving up if we continue down this road of regulating away cable package pricing.  Yeah, in a la carte pricing people who want just the kite-flying channel will pay less for it, but will it still be available?

It's Official: Trial Lawyers Manufactured the Vaccine Autism Scare

From CNN:

A now-retracted British study that linked autism to childhood vaccines was an "elaborate fraud" that has done long-lasting damage to public health, a leading medical publication reported Wednesday.An investigation published by the British medical journal BMJ concludes the study's author, Dr. Andrew Wakefield, misrepresented or altered the medical histories of all 12 of the patients whose cases formed the basis of the 1998 study -- and that there was "no doubt" Wakefield was responsible.

"It's one thing to have a bad study, a study full of error, and for the authors then to admit that they made errors," Fiona Godlee, BMJ's editor-in-chief, told CNN. "But in this case, we have a very different picture of what seems to be a deliberate attempt to create an impression that there was a link by falsifying the data."

Why anyone took a study serioiusly based on a population of 12 whole people always amazed me.  Anyway, to continue:

Wakefield has been unable to reproduce his results in the face of criticism, and other researchers have been unable to match them. Most of his co-authors withdrew their names from the study in 2004 after learning he had had been paid by a law firm that intended to sue vaccine manufacturers -- a serious conflict of interest he failed to disclose. After years on controversy, the Lancet, the prestigious journal that originally published the research, retracted Wakefield's paper last February.

The series of articles launched Wednesday are investigative journalism, not results of a clinical study. The writer, Brian Deer, said Wakefield "chiseled" the data before him, "falsifying medical histories of children and essentially concocting a picture, which was the picture he was contracted to find by lawyers hoping to sue vaccine manufacturers and to create a vaccine scare."

According to BMJ, Wakefield received more than 435,000 pounds ($674,000) from the lawyers. Godlee said the study shows that of the 12 cases Wakefield examined in his paper, five showed developmental problems before receiving the MMR vaccine and three never had autism.

"It's always hard to explain fraud and where it affects people to lie in science," Godlee said. "But it does seem a financial motive was underlying this, both in terms of payments by lawyers and through legal aid grants that he received but also through financial schemes that he hoped would benefit him through diagnostic and other tests for autism and MMR-related issues."

Wakefield has been responsible for a whole lot of misery and probably not a few deaths over the last decade.  Just losing his medical license, which happened earlier this year, is getting off cheap.

Useful Reset: What Peer Review Is and Is Not

This is from a post of mine last January, long before the Climategate scandal  (though most of us who spent a lot of time with climate issues knew of the Climategate abuses long before the smoking gun emails were found).  The one thing this article does not mention is what we know today -- that climate scientists were actively working to keep skeptical studies out of the literature, even to the point of getting editors fired.

Peer review is not a guarantee of accuracy or a good housekeeping seal of correctness.  It is a process that insures a work is worthy of publication by a scholarly magazine.  Whether a scientific question is "settled" does not end with peer review, it only begins. It becomes settled after it survives decades of criticism and replication work, a process that was stonewalled by the folks at the CRU, which is really the heart of the scandal.

Yesterday, while I was waiting for my sandwich at the deli downstairs, I was applying about 10% of my consciousness to CNN running on the TV behind the counter.  I saw some woman, presumably in the Obama team, defending some action of the administration being based on "peer reviewed" science.

This may be a legacy of the climate debate.  One of the rhetorical tools climate alarmists have latched onto is to inflate the meaning of peer review.  Often, folks, like the person I saw on TV yesterday, use "peer review" as a synonym for "proven correct and generally accepted in its findings by all right-thinking people who are not anti-scientific wackos."

But in fact peer review has a much narrower function, and certainly is not, either in intent or practice,  any real check or confirmation of the study in question.  The main goals of peer review are:

  • Establish that the article is worthy of publication and consistent with the scope of the publication in question.  They are looking to see if the results are non-trivial, if they are new (ie not duplicative of findings already well-understood), and in some way important.  If you think of peer-reviewers as an ad hoc editorial board for the publication, you get closest to intent
  • Reviewers will check, to the extent they can, to see if the methodology  and its presentation is logical and clear "” not necesarily right, but logical and clear.  Their most frequent comments are for clarification of certain areas of the work or questions that they don't think the authors answered.
  • Peer review is not in any way shape or form a proof that a study is correct, or even likely to be correct.  Enormous numbers of incorrect conclusions have been published in peer-reviewed journals over time.  This is demonstrably true.  For example, at any one time in medicine, for every peer-reviewed study I can usually find another peer-reviewed study with opposite or wildly different findings.
  • Studies are only accepted as likely correct a over time the community tries as hard as it can to poke holes in the findings.  Future studies will try to replicate the findings, or disprove them.  As a result of criticism of the methodology, groups will test the findings in new ways that respond to methodological criticisms.  It is the accretion of this work over time that solidifies confidence  (Ironically, this is exactly the process that climate alarmists want to short-circuit, and even more ironically, they call climate skeptics "anti-scientific" for wanting to follow this typical scientific dispute and replication process).

Further, the quality and sharpness of peer review depends a lot on the reviewers chosen.  For example, a peer review of Rush Limbaugh by the folks at LGF, Free Republic, and Powerline might not be as compelling as a peer review by Kos or Kevin Drum.

But instead of this, peer review is used by folks, particularly in poitical settings, as a shield against criticism, usually for something they don't understand and probably haven't even read themselves.  Here is an example dialog:

Politician or Activist:  "Mann's hockey stick proves humans are warming the planet"

Critic:  "But what about Mann's cherry-picking of proxy groups; or the divergence problem  in the data; or the fact that he routinely uses proxy's as a positive correlation in one period and different correlation in another; or the fact that the results are most driven by proxies that have been manually altered; or the fact that trees really make bad proxies, as they seldom actually display the assumed linear positive relationship between growth and temperature?"

Politician or Activist, who 99% of the time has not even read the study in question and understands nothing of what critic is saying:  "This is peer-reviewed science!  You can't question that."

For those interested in the science of the skeptics position please see my recent movie.

Update: Mark Steyn on Climate and Peer Review

Phrase That Needs to Be Expunged From The Political Lexicon: "Peer Reviewed"

Yesterday, while I was waiting for my sandwich at the deli downstairs, I was applying about 10% of my conciousness to CNN running on the TV behind the counter.  I saw some woman, presumably in the Obama team, defending some action of the administration being based on "peer reviewed" science.

This may be a legacy of the climate debate.  One of the rhetorical tools climate alarmists have latched onto is to inflate the meaning of peer review.  Often, folks, like the person I saw on TV yesterday, use "peer review" as a synonym for "proven correct and generally accepted in its findings by all right-thinking people who are not anti-scientific wackos."

But in fact peer review has a much narrower function, and certainly is not, either in intent or practice,  any real check or confirmation of the study in question.  The main goals of peer review are:

  • Establish that the article is worthy of publication and consistent with the scope of the publication in question.  They are looking to see if the results are non-trivial, if they are new (ie not duplicative of findings already well-understood), and in some way important.  If you think of peer-reviewers as an ad hoc editorial board for the publication, you get closest to intent
  • Reviewers will check, to the extent they can, to see if the methodology  and its presentation is logical and clear -- not necesarily right, but logical and clear.  Their most frequent comments are for clarification of certain areas of the work or questions that they don't think the authors answered.
  • Peer review is not in any way shape or form a proof that a study is correct, or even likely to be correct.  Enormous numbers of incorrect conclusions have been published in peer-reviewed journals over time.  This is demonstrably true.  For example, at any one time in medicine, for every peer-reviewed study I can usually find another peer-reviewed study with opposite or wildly different findings.
  • Studies are only accepted as likely correct a over time the community tries as hard as it can to poke holes in the findings.  Future studies will try to replicate the findings, or disprove them.  As a result of criticism of the methodology, groups will test the findings in new ways that respond to methodological criticisms.  It is the accretion of this work over time that solidifies confidence  (Ironically, this is exactly the process that climate alarmists want to short-circuit, and even more ironically, they call climate skeptics "anti-scientific" for wanting to follow this typical scientific dispute and replication process).

Further, the quality and sharpness of peer review depends a lot on the reviewers chosen.  For example, a peer review of Rush Limbaugh by the folks at LGF, Free Republic, and Powerline might not be as compelling as a peer review by Kos or Kevin Drum.

But instead of this, peer review is used by folks, particularly in poitical settings, as a shield against criticism, usually for something they don't understand and probably haven't even read themselves.  Here is an example dialog:

Politician or Activist:  "Mann's hockey stick proves humans are warming the planet"

Critic:  "But what about Mann's cherry-picking of proxy groups; or the divergence problem  in the data; or the fact that he routinely uses proxy's as a positive correlation in one period and different correlation in another; or the fact that the results are most driven by proxys that have been manually altered; or the fact that trees really make bad proxies, as they seldom actually display the assumed linear positive relationship between growth and temperature?"

Politician or Activist, who 99% of the time has not even read the study in question and understands nothing of what critic is saying:  "This is peer-reviewed science!  You can't question that."

Algae have extraordinarily diverse sex lives

OK, I buried the lede.  The post is actually not the sex lives of algae.  But I was fascinated that CNN chose to list this among the "story highlights" of this article.  The story supports my sense that if biofuels are ever going to make sense, they are not going to be made from corn.  The story also reinforces the notion that biofuels are just another type of solar energy, though they are in fact even more inefficient than our not-there-yet solar panels in converting sunlight to usable energy.  The only reason biofuels currently look more economic than solar are the enormous operating subsidies and the much lower capital costs  (though even the latter is open to argument since biofuels have huge capital costs in terms of land, but that generally is factored in as "zero" because the land is already being farmed.)

Before you get too excited about algae, note from the picture that the algae at this farm is grown in plastic packets that I would bet my life require more hydrocarbons to produce than the algae inside them provides.

Maybe They Should Have Tried Fox After All

Though I did not pay any attention to it, apparently the Clinton camp managed to stack the CNN Las Vegas debate doubly or triply in their favor, including having most all the talking head on CNN analyzing the debate be folks who are currently or have in the past been on the Clinton payroll.

Whatever.  I don't think it is any news that the Clintons play the politics game hard and well, though its amazing to me that she is embraced by those who complain about Bush being secretive and power-hungry.

Anyway, this did make me wonder.  The Democratic candidates were up-in-arms earlier this year that a debate (I think this one) was to be hosted by Fox, presumably because Fox is seen as part of the vast right-wing conspiracy.  But given that there were no Republicans at the debate, I wonder if Obama and company now regret this decision.  Because it is almost certain that whatever problems Fox might have, Fox would certainly not have stacked a debate in Hillary's favor.

A La Carte Pricing Will Hurt Niche Cable Channels

I see that the drive to force cable companies to offer their basic cable package a la carte rather than as a bundle is gaining steam again.  This is the dumbest regulatory step imaginable, and will reduce the number of interesting niche choices on cable.

For some reason, it is terribly hard to convince people of this.  In fact, supporters of this regulation argue just the opposite.  They argue that this is a better plan for folks who only are passionate about, say, the kite-flying channel, because they only have to pay for the channel they want rather than all of basic cable to get this one station.   This is a fine theory, but it only works if the kite-flying channel still exists in the new regulatory regime.  Let me explain.

Clearly the kite-flying channel serves a niche market.  Not that many people are going to be interested enough in kite flying alone to pay $5 a month for it.  But despite this niche status, it may well make sense for the cable companies to add it to their basic package.  Remember that the basic package already attracts the heart of the market.  Between CNN and ESPN and the Discovery Channel and the History Channel, etc., the majority of the market already sees enough value in the package to sign on.

Let's say the cable company wants to add a channel to their basic package, and they have two choices.  They have a sports channel they could add (let's say there are already 5 other sports channels in the package) or they can add the Kite-flying channel.  Far more people are likely to watch the sports channel than the kite flying channel.  But in the current pricing regime, this is not necessarily what matters to the cable company.  Their concern is to get more people to sign up for the cable TV.  And it may be that everyone who could possibly be attracted to sports is already a subscriber, and a sixth sports channel would not attract any new subscribers.  It is entirely possible that a niche channel like the kite-flying channel will actually bring more incremental subscribers to the basic package than another sports channel, and thus be a more attractive addition to the basic package for the cable company. 

But now let's look at the situation if a la carte pricing was required.  In this situation, individual channels don't support the package, but must stand on their own and earn revenue.  The cable company's decision-making on adding an extra channel is going to be very different in this world.  In this scenario, they are going to compare the new sports channel with the Kite-flying channel based on how many people will sign up and pay for that standalone channel.  And in this case, a sixth (and probably seventh and eighth and ninth) sports channel is going to look better to them than the Kite-flying channel.   Niche channels that were added to bring greater reach to their basic cable package are going to be dropped in favor of more of what appeals to the majority. 

I think about this all the time when I scan the dial on Sirius radio, which sells its services as one package rather than a la carte.  There are several stations that I always wonder, "does anyone listen to that?"  But Sirius doesn't need another channel for the majority out at #300 -- they need channels that will bring new niche audiences to the package.  So an Egyptian reggae channel may be more valuable as the 301st offering than a 20th sports channel.  This is what we may very likely be giving up if we continue down this road of regulating away cable package pricing.  Yeah, in a la carte pricing people who want just the kite-flying channel will pay less for it, but will it still be available?

Airport Dystopia

Nearly every dystopic novel I have ever read usually has an all-powerful state that insists on televisions everywhere in all public and private spaces to spew government propaganda and rebellion-soothing-entertainment at the masses.  (Example:  Richard Bachman / Stephen King's Running Man, which is a much better novel than a movie.)

I am reminded of this every time I go to an airport.  Why is it every airport feels the need to have CNN blaring from televisions spaced out every 20 feet or so.  You can't escape it or turn it off.  Do they really think I am so much of a moron that I can't entertain myself or even sit quietly without video Valium blaring at me every second.  Can't we maybe have some little quiet TV-free rooms, like the smoking rooms spaced around the airport?

I am an active computer gamer and much of the talk in the community is the uproar EA has caused by putting ads in Battlefield 2042.  Much of the discussion is not fact-based, but just panicky rumor-mongering, but one can see how much people don't want advertising pushed at them.  Which is funny to me, because ubiquitous TV in airports seems a much more annoying push than a few ads in a game.

Five Years Ago

Five years ago today, I was in Manhattan on a business trip with my wife.  I almost never take my wife on business trips, but we had been living in Seattle for several years, and my wife, who had lived in NYC for years, wanted to go back and visit.

About 7:30 AM, I went down to breakfast in the W Hotel, where I was staying.  I was working at the time for an aviation startup, and in one of the great moments of bad timing, I was in New York that day to make presentations to investors, the theme of which was that commercial aviation was in the midst of a recovery, and the time was right to invest in a commercial aviation venture. 

Part way into breakfast, my wife came down to find me, and tell us we needed to see what was on TV.  We went up to one of my investor's rooms.  He had a terraced penthouse (its good to be the king) from which we watched the disaster unfold, with CNN on in the background.

The next 24 hours were among the weirdest of my life.  For a while, we actually tried to hold our scheduled meetings, but a number of attendees had friends and family who worked in the WTC, and we called it off.  I wandered the streets of Manhattan, where bizarre rumors were flying at every street corner.  People ducked in fear every time an airplane rushed over, by this time all air force fighter planes.  By noon, dust-covered people walking up from downtown got to our area, and streamed past for the rest of the day.  Strangely, I actually ran into a friend of mine who had the last Hertz rent-a-car in the city, and we made plans to drive out of the city the next day.

Phone and cell service were spotty, but we eventually got through to the person taking care of our kids back in Seattle as well as our parents.  I had not told my mom we were in NYC, so she began our call by saying "I'm so glad all my kids are no where near NY" and I had to tell her, "Uhh, mom..."

That night was like a scene out of some Charlton Heston post-apocalypse movie.  Police were only letting cars out of the island, not back onto it, so by nightfall the city was empty and dead quiet.  We finally found a restaurant in Times Square open, and the Square was empty.  There was maybe one car driving through every few minutes.  A few roller bladers where skating around Times Square, just because they could.

The next day we played find the exit from Manhattan.  We knew from various reports that there was at least one bridge off the island open, but from either confusion or misplaced security concerns, no one seemed to know which bridge.  We began to circumnavigate Manhattan, looking for an exit.  Finally, a police officer told us the only way out was to drive all the way north through Harlem on the surface streets and get on what I think was the GW bridge.  Anyway, that is what we did (finding out in the process that Harlem was not the hell-hole that gets portrayed in movies, at least the part we saw).  I have never, ever been so happy to get to New Jersey.  I wanted to kiss the ground.  Of course, we still had a short drive to Seattle ahead of us, but that was anti-climactic.

It was only later I began learning how many people I knew died in those buildings that day.  I guess I should have thought about it, given the schools I attended.  The death toll for Harvard Business School graduates alone was staggering.  Five years later, watching the retrospectives, nothing about that day seems any less horrible.  Time, at least for me, has not softened the magnitude of this disaster. 

The only silver lining I can come up with is that we have gone five years without a major terrorist attack on this country, though other's have been attacked.  Walking around on September 12, we were all sure that this was just the front-end of a wave of massive attacks.  So far, whether through luck or skill, we have avoided this fate. 

One thing I will say is that we always prepare for the last attack.  We have spent a lot of time making sure no terrorists can take over a plane with toenail clippers and fly it into another building.   But that kind of attack was obsolete 20 minutes after the second plane hit the WTC -- It didn't even work on United 93.

The Source of Wealth

I was stuck in the airport at Salt Lake City on Sunday for a bit due to a large snowstorm** and I was trapped watching the CNN airport channel (which certain airports make unavoidable -- you can't get away from the TV's in a way reminiscent of a variety of distopian novels).  Anyway, I heard some discussion about differences between poor and rich nations, and all the usual easy-to-prove-false memes came out to explain the differences.  Natural Resources:  So why do resource-rich Russia and sub-Saharan Africa do so poorly?   Colonialism:  How do you explain Hong Kong, Australia, and Canada?  Exploiting labor:  So why aren't the most populous countries the richest?  Luck:  How do countries like Haiti have so consistently bad luck for over 200 years?

So here is Coyote's First Theorem of Wealth Creation, first expounded in this post on the zero-sum economics fallacy:

Groups of people create wealth faster in direct proportion to the degree that:

  1. Their philosophical and intellectual
    culture values ordinary men (not just "the elite", however defined) questioning established beliefs and social patterns.  This is as opposed to having a rigid orthodoxy which treats independent thinking as heresy.
  2. Individuals, again not just the elite, have the ability through scholarship or entrepreneurship to pursue the implications of their ideas and retain the monetary and other rewards for themselves.  This is as opposed to being locked into a rigid social and economic hierarchy that would prevent an individual from acting on a good idea.   

China, for example, just by cracking open the spigot on #2, however inadequately, has gone from a country with mass starvation in three or four decades to one where the worry-warts of the world are scared of juvenile obesity.  To a large extent, this theorem is really just a poor restatement of Julian Simon's work.  Simon's key point was that the only relevant resource was the human mind, from which all wealth flows.  All I have done is break this into two parts, saying that to create wealth a society has to value the individual's use of his mind and has to allow that individual free reign to pursue the products of his thinking.

One of the applications where I think this is useful is to explain the great millennial hockey-stick curve.  No, not the temperature hockey stick, which purports to show acceleration of global warming, but the wealth curve.  The world's growth of per capita wealth was virtually flat for a thousand plus years, and then took off in the 19th and 20th centuries.  I previously explained this hockey stick using my wealth creation theorem:

Since 1700, the GDP per capita in places like the US has
risen, in real
terms, over 40 fold.  This is a real increase in total wealth, created
by the human mind.  And it was unleashed because the world began to
change in some fundamental ways around 1700 that allowed the human mind
to truly flourish.  Among these changes, I will focus on two:

  1. There was a philosophical and intellectual
    change where questioning established beliefs and social patterns went
    from being heresy and unthinkable to being acceptable, and even in
    vogue.  In other words, men, at first just the elite but soon everyone,
    were urged to use their mind rather than just relying on established
    beliefs
  2. There were social and political changes that greatly increased
    the number of people capable of entrepreneurship.  Before this time,
    the vast vast majority of people were locked into social positions that
    allowed them no flexibility to act on a good idea, even if they had
    one.  By starting to create a large and free middle class, first in the
    Netherlands and England and then in the US, more people had the ability
    to use their mind to create new wealth.  Whereas before, perhaps 1% or
    less of any population really had the freedom to truly act on their
    ideas, after 1700 many more people began to have this freedom. 

So today's wealth, and everything that goes with it (from shorter
work hours to longer life spans) is the result of more people using
their minds more freely.

The problem (and the ultimate potential) comes from the fact that in
many, many nations of the world, these two changes have not yet been
allowed to occur.  Look around the world - for any country, ask
yourself if the average
person in that country has the open intellectual climate that
encourages people to think for themselves, and the open political and
economic climate that allows people to act on the insights their minds
provide and to keep the fruits of their effort.  Where you can answer
yes to both, you will find wealth and growth.  Where you answer no to
both, you will find poverty and misery.

Update:  This article from Frank Moss, linked at Instapundit, takes these same concepts forward into the future.

What role will startups play in the future?

I see tremendous economic growth from startups from 10 years ago.
Entrepreneurs will go from the 1,000 startup ventures funded in the
last 10 to 20 years to ideas coming from people working together in
network-based environments, using computers to dream up innovations in
a way they never did before. It could be people in developing countries
with low-cost computers.

You talk about education and the bottom-up effect that millions
more people will play in societal advances. How do you see this
unfolding?

We will undergo another revolution when we give 100 million kids a
smart cell phone or a low-cost laptop, and bootstrap the way they learn
outside of school. We think of games as a way to kill time, but in the
future I think it will be a major vehicle for learning.

Creative expression (is another area). No longer will just a few
write or create music. We will see 100 million people creating the
content and art shared among them. Easy-to-use programs allow kids to
compose everything form ringtones to full-fledged operas. It will
change the meaning of creative art in our society.

We are already seeing early signs of it in blogs. The source of
creative content is coming from the world. That revolution will go well
outside of the written word to all forms of visual and performing arts.

 

** Kudos by the way to the SLC airport - when I drove in, I couldn't see 10 feet in front of me on the road due to the snow, and I was sure that I would be trapped for the day.  Living in Phoenix, where air traffic is backed up if someone sneezes on the runway, I didn't think any planes would be landing and taking off for hours.  In fact, operations continued right through the blizzard, and my flight was delayed less than an hour, including de-icing time.  Amazing.  Now if only the SLC airport could increase their security capacity - its only been, what, 4.5 years since 9/11 and most airports seem to have licked this problem.

Security as Trojan Horse for Protectionism

I can't help but suspect of late that the whole Dubai ports mess signals an intent by protectionists of many stripes to hop on the security bandwagon as a way to repackage protectionism.  One had but to observe the many Congressmen who up to date have shown very little interest in security issues suddenly becoming born-again hawks with on the Dubai issue.  Democratic politicians who up to this point had opposed any actions targeted at Arabs or Muslims as profiling and hate-based suddenly saw the light and opposed the deal based on absolutely no other evidence than the fact the owners were from Dubai.  I particularly laughed at the quote by Howard Dean lamenting that "control of the ports of the United States must be retained by American companies" (funny, since Dubai-ownership was taking over operations from a British company, not an American company).  The Dubai ports deal opposition was first and foremost protectionism, begun at the behest of a domestic company that lost a bid in Miami and a number of domestic unions.

Now we can start to see this bandwagon grow.  I was in the airport and saw one Congressman (Duncan Hunter, I think, but I am not positive) on CNN proposing new legislation to ban foreign ownership of any infrastructure deemed security-sensitive.  He specifically mentioned power plants, which told me that he was thinking pretty expansively. This is rank protectionism, pure and simple.  You can quickly imagine everything from power plants to oil companies to telephone providers - really just about anyone - coming under the auspices of a critical industry that should be all American.  Just check out the case of low-cost airline upstart Virgin America to see how this security dodge is being used to protect companies from competition and prevent consumers from getting more choices and lower prices (also see WSJ$).

Xenophobia, in terms of this protectionism and the new immigrant backlash, appears to be one of the few bipartisan issues that politicians from both sides of the aisle can get behind.  I fear a new McCarthyism in the works.

You Readers are Getting a Bargain

Apparently Yale's Econ 109 Microeconomics class has been assigned my post on Business Relocation and the Prisoner's Dilemma as part of this week's reading.  They are paying tens of thousands of dollars to read this site, while my 17 regular readers are getting it for free!  I'm not sure I am a huge Yale fan, given I attended Princeton and later Harvard, but I may have underestimated them now that I know what discriminating taste they have in blog reading.

Interesting Arcana:  The actual reason I think the professor found my article is probably because he used the spelling "dilemna" rather than "dilemma" when Google searching, as I did in the post title.  For some reason, I have always gravitated to this funny spelling with an "n" rather than a second "m".  I don't seem to be the only one - Google has hundreds of thousands of hits for dilemna.  What is the deal here?  I can't find dilemna as an alternate spelling anywhere in a dictionary, but it gets used a lot.  Hell, its in a CNN headline here.  A bunch of the Google hits for "dilemna" are in articles written by university professors.

So here is where you really have to love the web.  It turns out that this has actually been a discussion board topic in a number of places.  Here is part of a thread, for example, on dilemna vs dilemma.

John's note about being certain the word was spelled "dilemna" really hit home for me. It's almost as though at some point in my life I learned that was indeed the correct spelling and somehow had an edge on the masses. As with John, when I write I tend to pronounce words in my mind the way they are spelled - ie. FebRUary, WedNESday, etc. And as a champion speller in my younger days, it only seemed natural that I would be in the know.

As it happens, I'm writing a book right now, and the word came up. Though I spelled it the way I always knew was correct, I decided to double check with the dictionary and suddenly it was as though I was in the Twilight Zone. It was gone. Since dilemna is not as the word sounds, I can't figure out how the situation developed. I'm still convinced the spelling has changed somewhere along the way (ha!). I also recently had this same revelation with the word "pom-pom" (as in cheerleader's) which I always thought I was so smart in spelling as  "pompon." At least pompon is in the dictionary, though it has a slightly different meaning as the head of a chrysanthemum.

The only thing I can conclude is that I must have been living a parallel life in which these words were indeed spelled this way, and somehow made a crossover in recent years ....  (Twilight Zone Theme: do-do-do-do do-do-do-do)

There is a whole string of conjectures like this, but no real answer.  I will admit, now that this guy has, that I too had a certain Ivy-League-smarter-than-the-masses confidence that I had it right.  Ooops.

Gerry Thomas, RIP

Gerry Thomas, inventor of the TV dinner, died here in Phoenix at the age of 83.  Though decried by the intelligentsia of this country, the TV dinner opened the door for a huge influx of products aimed at letting people who don't want to or can't cook create a decent meal.  As a kid, it never ceased to be a treat to get one of these for our evening meal, and looking back, Mr. Thomas and his successors probably cooked for me more than my mom.  Mr. Thomas is a member of the Frozen Food Hall of Fame (I kid you not) in Orlando.  This strikes me as a story that James Lileks should be all over.

Tvdinner


Update:
  According to CNN, James Doohan, recently diagnosed with Alzheimer's, has died as well.  How many times have you asked this guy to get you out of a tough spot?  Beam me up, Scotty.

Scotty

Great Moments in Media Fact Checking

Via Wizbang, who helped point the finger at the CBS forged memos, comes this story about an AP Report of a American service man supposedly held hostage:

Iraqi militants claimed in a Web statement Tuesday to have taken an American soldier hostage and threatened to behead him in 72 hours unless the Americans release Iraqi prisoners.

The posting, on a Web site that frequently carried militants' statements, included a photo of what appeared to be an American soldier in desert fatigues seated with his hands tied behind his back.

A gun barrel was pointed at his head, and he is seated in front of a black banner emblazoned with the Islamic profession of faith, "There is no god but God and Muhammad is His prophet."

It even is accompanied with this picture:

Soldier_held

Only problem is that this is actually a photo of a GI Joe doll. 

Bd0450_1

The "professionals" at the AP were taken in hook line and sinker, leaving it to "amateurs" on the web to debunk the hoax in about a half and hour.  Read all about it at the Wizbang link above.

Update:  CNN has caught up on the story

Great Moments in Media Fact Checking

Via Wizbang, who helped point the finger at the CBS forged memos, comes this story about an AP Report of a American service man supposedly held hostage:

Iraqi militants claimed in a Web statement Tuesday to have taken an American soldier hostage and threatened to behead him in 72 hours unless the Americans release Iraqi prisoners.

The posting, on a Web site that frequently carried militants' statements, included a photo of what appeared to be an American soldier in desert fatigues seated with his hands tied behind his back.

A gun barrel was pointed at his head, and he is seated in front of a black banner emblazoned with the Islamic profession of faith, "There is no god but God and Muhammad is His prophet."

It even is accompanied with this picture:

Soldier_held

Only problem is that this is actually a photo of a GI Joe doll. 

Bd0450_1

The "professionals" at the AP were taken in hook line and sinker, leaving it to "amateurs" on the web to debunk the hoax in about a half and hour.  Read all about it at the Wizbang link above.

Update:  CNN has caught up on the story

Bush Election Improvement Came in the Cities

CNN has some pretty fun exit poll data here.  As both an engineer and an analyst at heart, I enjoy plowing around in data to find new conclusions.

One interesting thing I found was where the vote for Bush and Kerry came from in terms of urban vs. rural locations:

VOTE BY SIZE OF COMMUNITY
BUSH
KERRY NADER
TOTAL
2004
vs.2000
2004
2004
Urban (30%)
45%
+10
54% 0%
Suburban (46%)
52%
+3
47% 0%
Rural (25%)
57%
-2
42% 0%

Because people are thinking of the red/blue state map, and even more the red/blue county map, they want to portray the red/blue split in part as an urban-rural split.  This is reinforced by the perception of Bush as the NASCAR loving gun toting country redneck and Kerry as the overeducated stiff urban intellectual. 

The problem is that the exit poll results don't necessarily support this.  Note two things:

  1. The suburbs drive the result.  Rural and urban basically cancel each other out, with a larger urban than rural population but a larger relative Bush lead in rural.  In both '00 and '04, the suburban vote split closely mirrors the total tally.
  2. Bush won the popular vote because he improved about 3 points and added 4 million votes to his differential.  This table says that nearly all of that came in the urban vote, with a whopping 10 point improvement that drove a 3 point improvement in the total.

Because a lot of this urban improvement occurred in Blue states, the electoral college margin was still close because he ended up closing the gap in blue states rather than flipping many.

Assymetrical Information mines the same data to demonstrate the surge in Latino support for Bush.  Interestingly, it also shows that Bush led among both high school and college graduates (defeating some of his stereotype).  Kerry, on the other hand, carried both high school dropouts and post-grads (ie, the under and over-educated)

UPDATE

Welcome to Professor Bainbridge readers.  If you are not burned out on election news, here is my winner for the most over the top post-election article, and my response.

UPDATE #2

Confirming data from New York City via The Galvin Opinion