Posts tagged ‘Update Wow’

A Milestone to Celebrate: I Have Closed All My Businesses in Ventura County, California

Normally, the closure of a business operation or division is not grounds for a celebration, but in this case I am going to make an exception.  At midnight on December 31, I not only drank a toast to the new year, but also to finally getting all my business operations out of Ventura County, California.

Never have I operated in a more difficult environment.  Ventura County combines a difficult government environment with a difficult employee base with a difficult customer base.

  • It took years in Ventura County to make even the simplest modifications to the campground we ran.  For example, it took 7 separate permits from the County (each requiring a substantial payment) just to remove a wooden deck that the County inspector had condemned.  In order to allow us to temporarily park a small concession trailer in the parking lot, we had to (among other steps) take a soil sample of the dirt under the asphalt of the parking lot.   It took 3 years to permit a simple 500 gallon fuel tank with CARB and the County equivilent.   The entire campground desperately needed a major renovation but the smallest change would have triggered millions of dollars of new facility requirements from the County that we simply could not afford.
  • In most states we pay a percent or two of wages for unemployment insurance.  In California we pay almost 7%.  Our summer seasonal employees often take the winter off, working only in the summer, but claim unemployment insurance anyway.  They are supposed to be looking for work, but they seldom are and California refuses to police the matter.  Several couples spend the whole winter in Mexico, collecting unemployment all the while.  So I have to pay a fortune to support these folks' winter vacations.
  • California is raising minimum wages over the next 2 years by $2.  Many of our prices are frozen by our landlord based on past agreements they have entered into, so we had no way to offset these extra costs.  At some point, Obamacare will stop waiving its employer mandate and we will owe $2000-$3000 extra additional for each employee.  There was simply no way to support these costs without expanding to increase our size, which is impossible (see above) due to County regulations.
  • A local attorney held regular evening meetings with my employees to brainstorm new ways the could sue our company under arcane California law.  For example, we went through three iterations of rules and procedures trying to comply with California break law and changing "safe" harbors supposedly provided by California court decisions.  We only successfully stopped the suits by implementing a fingerprint timekeeping system and making it an automatic termination offense to work through lunch.  This operation has about 25 employees vs. 400 for the rest of the company.  100% of our lawsuits from employees over our entire 10-year history came from this one site.  At first we thought it was a manager issue, so we kept sending in our best managers from around the country to run the place, but the suits just continued.
  • Ask anyone in the recreation business where their most difficult customers are, and they likely will name the Los Angeles area.  It is impossible to generalize of course, because there are great customers from any location, but LA seems to have more than its fair share of difficult, unruly, entitled customers.   LA residents are, for example, by far the worst litterers in the country, at least from our experience.  Draw a map of California with concentric circles around LA and the further out one gets, the lower the litter clean-up costs we have.  But what really killed it for me in Ventura County was the crazy irresponsible drinking and behavior.  Ventura County is the only location out of nearly 200 in the country where we had to hire full-time law enforcement help to provide security.  At most locations, we would get 1 arrest every month or two (at most).  In Ventura we could get 5-10 arrests a day.  In the end, I found myself running a location where I would never take my own family.

And so I got out.  Hallelujah.

PS-  People frequently talk about taxes in California being what makes the state "anti-business."  That may be, but I guess I never made enough money to have the taxes really bite.  But taxes are only a small part of the equation.

Update:  Wow, reading this again, I left out so much!  An employee once sued us at this location for harassment and intimidation by her manager -- when the manager was her sister!  It cost me over $20,000 in legal expenses to get the case dismissed.  I had an older couple file a state complaint for age discrimination when they were terminated -- despite the fact that our entire business model is to hire retired people and the vast majority of our employees are 70 and older.  And how could I have forgotten the process of getting a liquor license?  I suppose I left it out because while tedious (my wife and I had to fly to California to get fingerprinted, for example), it is not really worse than in other places -- liquor license processes are universally bad, a feature and not a bug for the established businesses one is trying to compete with.   We gave the license up pretty quickly, when we saw how crazy and irresponsible much of the customer base was.  Trying to make the place safer and more family friendly, we banned alcohol from the lake area, and faced a series of lawsuit threats over that.


Here is the Key Bait and Switch

Bill Clinton joined a number other leftish writers of late trying to marginalize those who criticize the government (and in particular, I think, the Tea Party folks).   I am really not going to comment much on this attempt, except to say that we endured something identical during the Iraq war, with the BS about not criticizing the President during wartime.

Here is the key bait and switch in Clinton's argument:

But we should remember that there is a big difference between criticizing a policy or a politician and demonizing the government that guarantees our freedoms and the public servants who enforce our laws.

The government that guarantees our freedoms?  I suppose this sounds sort of good if one just lets it roll by, but in the context of our country's formation, this is absurd.  The only threat to freedom that the founders of this nation were concerned about was the government itself.

The government is the only entity with the power to use force and the power to grab money without permission.  As such, the founders recognized it as the single most potent threat to freedom that could possibly exist.  All their efforts were aimed at constructing limitations and protections from the power of government itself.

It would be far more correct to say "the Constitution that guarantees our freedoms" by limiting the power of government, but in fact that is exactly what the left is trying to overturn, with a hundred years of efforts to slowly whittle the Constitutional limitations on the power of government down to zero.

Update: Wow, this is an amazing excerpt from a 1995 memo from Dick Morris to Clinton just after the Oklahoma City bombing.  Seems like he is still following the same playbook:

Later, under the heading "How to use extremism as issue against Republicans," Morris told Clinton that "direct accusations" of extremism wouldn't work because the Republicans were not, in fact, extremists. Rather, Morris recommended what he called the "ricochet theory." Clinton would "stimulate national concern over extremism and terror," and then, "when issue is at top of national agenda, suspicion naturally gravitates to Republicans." As that happened, Morris recommended, Clinton would use his executive authority to impose "intrusive" measures against so-called extremist groups. Clinton would explain that such intrusive measures were necessary to prevent future violence, knowing that his actions would, Morris wrote, "provoke outrage by extremist groups who will write their local Republican congressmen." Then, if members of Congress complained, that would "link right-wing of the party to extremist groups." The net effect, Morris concluded, would be "self-inflicted linkage between [GOP] and extremists."

A Peak Inside the Boiler Room

I got another boiler room broker call today, so I guess the recent downturn has not flushed out all the cockroaches.  A while back I discussed the frequent calls I get from boiler room stock promoters.  The approach they use with me is this:

So the other day, I accidentally let one of them go further than I usually allow.  He said he was from Olympia Asset Management.  (There is an Olympia Asset Management web page, but I don't know if it is the same company and the web page has not been updated for several years.)  I let him run for a bit because a friend of mine runs a very well-respected financial planning firm with a different name but also with Olympia in the title, and for a moment I thought it might have been one of his folks.

Anyway, he proceeds to try to convince me that we have talked before and discussed a certain security.  "Remember me, we talked six months ago about ____".  Of course, I had never heard of the guy.  At this point I usually hang up, because I have heard this crap before -- it is a common pitch.

Its pretty clear to me now that this is what he is doing:

  1. Trying to imply that we have some kind of relationship we actually don't have.  Or worse...
  2. Trying to convince me that he touted stock A six months ago, so now he can tell me stock A has gone up in price.  Many reputable brokers built their reputation by cold calling people and saying:  Watch these 3 stocks and see how they do and I will call you back in 6 months.  That way, you can evaluate their stock picking without risk.  The modern sleazy approach is to pick a stock that has gone up a lot in the last 6 months, and then call some harried business person and pretend you called them with that pick 6 months ago, hoping that they will give you the benefit of the doubt.

The call just went downhill from there.  I hung up after his discussion of throwing Molotov cocktails into the cars of people he doesn't like.  That was right after I asked him if Tony Soprano was standing beside him listening in on the call.

Anyway, beware.  The guy today called me and asked me if I remembered him calling 6 months ago predicting the downturn in the mortgage market and the crash of the financial stocks.  You are not crazy - no matter how certain the guy seems, you really did not talk to him 6 months ago.

By the way, I am not the only one getting this pitch.  Ed Moed got the same pitch from the same script from the same company.  Many of his commenters share similar experiences.

Update: Wow, they sure do like Mitt Romney over at Olympia Asset Management.  I'm sure there was no arm-twisting here, when every single employee of the company seems to have given the max donation to the same candidate, with no breaking of ranks.

Update #2: Mike Murphy, CEO of Olympia Asset Management, was "a member of the [Hoffstra's] elite football team."  Wow.  Remember that time Hoffstra ripped through all those SEC teams?  Yeah, neither do I.  Anyway, this achievement does not hold a candle to the fact that I was once captain of Princeton Tower Club's elite intramural coed field hockey team.

The $9 Billion Dollar Toe

A few weeks ago I was amazed at the story of the city of Chicago spending hundreds of millions of dollars to build the terminal rail station of a rail line that had no plan, no route, no approval, and no money.  Why spend hundreds of millions on a station that could well be orphaned?  The reason, I supposed, was to make a toe in the water investment where the public could later be shamed into voting more funds for building a rail line to actually connect to their fabulous new station.

It appears that California may be doing the same thing. This November, voters in that state will have the chance to approve a $9.95 billion rail bond issue.  $9 billion of this is earmarked for building a high-speed rail line from Anaheim to San Francisco.  But current estimates for this line's cost, which are always way too low, are for $30 billion.  Who in their right mind would proceed with a $30 billion (or likely more) project when only $9 billion of funding has been obtained?  Only scam artists, Ponzi schemes.... and the government.

  Wow!  Boy, I must be dumb or something.  The website supporting this bond issue says that this project will create 450,000 permanent new jobs.  How can anyone oppose that?  This is really amazing, since the entire US railroad industry currently employs 224,000 people, but this one rail line will create 450,000 jobs! 

Update #2:  I like to make predictions about government rail projects, so here is mine for this one:  I don't know what end they are starting with, but if they start from the south, I will bet that $9 billion does not even get them out of the LA area (say past Santa Clarita or Santa Barbara), much less anywhere close to San Francisco.

Statism Comes Back to Bite Technocrats

Over the past fifty years, a powerful driving force for statism in this country has come from technocrats, mainly on the left, who felt that the country would be better off if a few smart people (ie them) made the important decisions and imposed them on the public at large, who were too dumb to make quality decision for themselves.  People aren't smart enough,they felt, to make medication risk trade-off decision for themselves, so the FDA was created to tell them what procedures and compounds they could and could not have access to.  People couldn't be trusted to teach their kids the right things, so technocrats in the left defended government-run schools and fought school choice at every juncture.  People can't be trusted to save for their own retirement, so  the government takes control with Social Security and the left fights giving any control back to individuals.  The technocrats told us what safety equipment our car had to have, what gas mileage it should get, when we needed to where a helmet, what foods to eat, when we could smoke, what wages we could and could not accept, what was and was not acceptable speech on public college campuses, etc. etc.

Throughout these years, libertarians like myself argued that there were at least three problems with all of this technocratic statism:

  • You can't make better decisions for other people, even if you are smarter, because every person has different wants, needs, values, etc., and thus make trade-offs differently.  Tedy Bruschi of the Patriots is willing to take post-stroke risks by playing pro football again I would never take, but that doesn't mean its a incorrect decision for him.
  • Technocratic idealists ALWAYS lose control of the game.  It may feel good at first when the trains start running on time, but the technocrats are soon swept away by the thugs, and the patina of idealism is swept away, and only fascism is left.  Interestingly, the technocrats always cry "our only mistake was letting those other guys take control".  No, the mistake was accepting the right to use force on another man.  Everything after that was inevitable.

I am reminded of all this because the technocrats that built our regulatory state are starting to see the danger of what they created.  A public school system was great as long as it was teaching the right things and its indoctrinational excesses were in a leftish direction.  Now, however, we can see the panic.  The left is freaked that some red state school districts may start teaching creationism or intelligent design.  And you can hear the lament - how did we let Bush and these conservative idiots take control of the beautiful machine we built?  My answer is that you shouldn't have built the machine in the first place - it always falls into the wrong hands.  Maybe its time for me to again invite the left to reconsider school choice.

Today, via Instapundit, comes this story about the GAO audit of the decision by the FDA to not allow the plan B morning after pill to be sold over the counter.  And, knock me over with a feather, it appears that the decision was political, based on a conservative administration's opposition to abortion.  And again the technocrats on the left are freaked.  Well, what did you expect?  You applauded the Clinton FDA's politically motivated ban on breast implants as a sop to NOW and the trial lawyers.  In establishing the FDA, it was you on the left that established the principal, contradictory to the left's own stand on abortion, that the government does indeed trump the individual on decision making for their own body  (other thoughts here).  Again we hear the lament that the game was great until these conservative yahoos took over.  No, it wasn't.  It was unjust to scheme to control other people's lives, and just plain stupid to expect that the machinery of control you created would never fall into your political enemy's hands.

OK, rant over.  No one wants to hear "you asked for it", but that is indeed my answer to many of the left's laments today about conservatives taking over their treasured instruments of state control.  I hate to be a geek here, but even Star Trek figured out this whole technocrat losing control of the fascist state thing 40 years ago.

Update:  Wow, I am not that skilled with reading academix-speak, but I am pretty sure that Ed Glaeser via Margina Revolution is saying the same thing:

Soft paternalism requires a government bureaucracy that is skilled in
manipulating beliefs.  A persuasive government bureaucracy is inherently
dangerous because that apparatus can be used in contexts far away from the
initial paternalistic domain.  Political leaders have a number of goals, only
some of which relate to improving individual well-being.  Investing in the tools
of persuasion enables the government to change perceptions of many things, not
only the behavior in question.  There is great potential for abuse.

Update:  Cafe Hayek discusses how the FDA is failing even technocratic objectives and this is an amazing data-rich in-depth analysis of the FDA vs. markets in managing drug risk/reward choices:

The debate over off-label prescribing is not about perfect safety; it is about
whether unavoidable trade-offs are best made for everyone by a centralized authority
such as the FDA or whether those decisions are best made by patients and doctors
acting independently. Whoever makes a decision to try (patient), prescribe (doctor),
or approve (FDA) a drug must face the trade-off between the costs of prescribing a
potentially unsafe medicine (a type II cost) and the costs of not prescribing a drug
that could have saved a life (a type I cost)....

The FDA tends to overemphasize the cost of using a potentially unsafe medicine,
because type II costs are highly visible and result in punishment of the FDA, whereas
type I costs are invisible and do not result in punishment.

If the FDA approved a drug that killed thousands of people, that story would make
the front page of every newspaper in the nation. Congressional hearings would certainly he held, the head of the FDA would probably lose his or her job, and the agency would be reorganized. But if the FDA rejected a drug that could save thousands of people, who would complain? When a drug kills a patient, that person is identifiable, and family and friends may learn the cause of the death. In contrast, the patient who would have lived, had new drugs been available, is identifiable only in a statistical sense. Family and friends will never know whether their loved one could have survived had the FDA not delayed the introduction of a new drug. In some cases the drug that could have saved the patient's life is never created, because the costs of the FDA's testing procedures make the necessary research and development appear unprofitable...

Patients and doctors do not face the same biased incentives as the FDA and thus
tend to pay more attention to the costs of not using a drug that could save a life.

The Health Care Trojan Horse

I get email and comments from time to time that my language deriding government's intervention into every aspect of our lives is overblown and exaggerated.  My answer:  Oh yeah, well how about this:

Mike Huckabee, the Governor of Arkansas, now
requires annual fat reports. These are sent to the parents of every
single child aged between 5 and 17; a response, he says, to "an
absolutely epidemic issue that we could not ignore" in the 1,139
schools for which he is responsible.

I just cannot craft any reasonable theory of government where this is the state's job.   The "obesity" crisis in this country just amazes me.  "Experts" every few years broaden the definition of who is overweight or obese, and suddenly (surprise!) there are more people defined as overweight.  Even presuming it is the state's job to optimize our body weights, is it really the right approach to tell everyone they are too fat?  Having known several people who were anorexic, including at least one young woman who died of its complications, is it really a net benefit to get young people more obsessed with looks and body style?  And what about the kids that are genetically programmed to be overweight?  Does this mean that years of taunting and bullying by their peers is not enough, that the state's governor wants to pile on now?

It is interesting to note that governor Huckabee apparently started this initiative after his own personal battle with weight loss:

[Huckabee] lost 110lb after being warned that his
weight, more than 280lb after a life of southern fried food, was a
death sentence. A chair even collapsed under him as he was about to
preside over a meeting of state officials in Little Rock.

We all have friends who have lost weight or gotten into homeopathy or became a vegan and simply cannot stop trying to convert their friends now that they see the light.  Now we have the spectacle of elected officials doing the same thing, but on a broader scale and with the force of law, rather than  just mere irritation, on their side.  One can only imagine what report cards kids would be carrying home if Huckabee had instead had a successful experience with penis enlargement.  What's next, negative reports for kids with bad acne?  For women whose breasts are too small?  For kids who are unattractive?

As I have argued many times in the past, a large part of the blame for these initiatives is public funding of health care.  Beyond the efficiency and choice arguments, I have tried to point out that publicly funded health care is a Trojan horse for a number of truly intrusive nanny-state government controls of our lives.

It isn't such a stretch to imagine the effect
when people realise "” as residents of Arizona have been told already "”
that about 40 per cent of their healthcare charges are spent treating
the consequences of avoidable obesity.

When health care is paid for by public funds, politicians only need to argue that some behavior affects health, and therefore increases the state's health care costs, to justify regulating the crap out of that behavior.  Already, states have essentially nationalized the cigarette industry based on this argument.

By the way, I am willing to make a bet with anyone that no where near 40% of our healthcare charges in Arizona are due to obesity.  I am positive some advocate made up this number, or created it using some ridiculously broad assumptions, and it has now been swallowed by the credulous and scientifically-illiterate press.

Update: Wow, the solution to obesity!  Government funded shrubbery:

City dwellers living in areas with little greenery and high levels of
graffiti and litter are more likely to be obese than those living in
pleasant areas with lots of greenery, say researchers in a study
published on today.

Reason number 6,345 not to ever take "facts" from a "study" reported in the media at face value.

Update #2: More about the health care as a trojan horse for statism  (emphasis added)

BangkokThe World Health
Organization (WHO) has always had a rather expansive notion of what it
means to be healthy. If one looks at the official definition it defines
health as a "state of complete physical, mental and social well-being
and not merely the absence of disease or infirmity." According to that
understanding there isn't much that is not in some way connected with
health.  And for the health promoters at WHO's recently completed Bangkok conference that means that health is the supremely important value that trumps everything else.

all, the health promoters argue, it is surely obvious that health is a
necessary condition for any sort of life, so it must follow that for
any truly rational person health must outweigh any other value that
might conflict with it.
But the "obvious" -- especially the obvious of
the health promoter -- is often likely to be untrue. While it may be
true that being alive is in some not very interesting sense necessary
for having a life, it is not at all true that being "healthy,"
especially as defined by WHO, is a necessary condition for having a
good life.


of us make trade-offs between optimal health and other values all of
the time. We travel by car for instance, for reasons of economy or
convenience, even though we might recognize that statistically planes
are safer. We smile at Alan Dershowitz's cardiac calculus where a
patient chooses between ten years of inactive life and the risk of
sudden death:


doctor has made a prognosis/That intercourse fosters thrombosis/But I'd
rather expire/Fulfilling desire/Then abstain, and develop neurosis."