Month: June 2018

Trump’s Judges Constrain the Administrative State

(p. A1) WASHINGTON — It has been practically a given that anyone nominated for a federal judgeship by a Republican president had to pass an unspoken litmus test — usually on abortion but often on any number of divisive social issues.
The Trump administration has a new litmus test: reining in what conservatives call “the administrative state.”
With surprising frankness, the White House has laid out a plan to fill the courts with judges devoted to a legal doctrine that challenges the broad power federal agencies have to interpret laws and enforce regulations, often without being subject to judicial oversight. Those not on board with this agenda, the White House has said, are unlikely to be nominated by President Trump.
. . .
(p. A13) That the concept of “the administrative state” has become so central to politics today shows how successful the Trump administration has been in elevating to the mainstream ideas that once thrived mainly on the edges of conservative and libertarian thought.
A year ago it was a term known mostly among academics to describe the vast array of federal departments and the unelected functionaries who run them. It entered the mainstream political lexicon last year after the president’s former chief strategist, Stephen K. Bannon, pledged a “deconstruction of the administrative state” under Mr. Trump.
. . .
But this thinking has been advanced by many libertarian-minded conservatives who have long doubted whether the founders envisioned the creation of many New Deal and Great Society programs and the abundance of regulations that flowed from them.
“A lot of this, if you unpack it, I think it will get back to fundamental fairness,” said Mark Holden, general counsel for Koch Industries, which is led by Charles G. and David H. Koch, two of the biggest financial backers of the effort to elect office holders committed to deregulation and free-market enterprise.
The Trump judicial selection process, Mr. Holden added, was ultimately focused on “the size and scope of government and scaling it back, to the extent that it’s counterproductive and contrary to due process.”

For the full story, see:
Jeremy W. Peters. “New Litmus Test for Trump’s Court Picks: Taming the Bureaucracy.” The New York Times (Wednesday, March 28, 2018): A1 & A13.
(Note: ellipses added.)
(Note: the online version of the story has the date March 26, 2018, and has the title “Trump’s New Judicial Litmus Test: Shrinking ‘the Administrative State’.”)

“Infatuation with Deep Learning May Well Breed Myopia . . . Overinvestment . . . and Disillusionment”

(p. B1) For the past five years, the hottest thing in artificial intelligence has been a branch known as deep learning. The grandly named statistical technique, put simply, gives computers a way to learn by processing vast amounts of data.
. . .
But now some scientists are asking whether deep learning is really so deep after all.
In recent conversations, online comments and a few lengthy essays, a growing number of A.I. experts are warning that the infatuation with deep learning may well breed myopia and overinvestment now — and disillusionment later.
“There is no real intelligence there,” said Michael I. Jordan, a professor at the University of California, Berkeley, and the author of an essay published in April intended to temper the lofty expectations surrounding A.I. “And I think that trusting these brute force algorithms too much is a faith misplaced.”
The danger, some experts warn, is (p. B4) that A.I. will run into a technical wall and eventually face a popular backlash — a familiar pattern in artificial intelligence since that term was coined in the 1950s. With deep learning in particular, researchers said, the concerns are being fueled by the technology’s limits.
Deep learning algorithms train on a batch of related data — like pictures of human faces — and are then fed more and more data, which steadily improve the software’s pattern-matching accuracy. Although the technique has spawned successes, the results are largely confined to fields where those huge data sets are available and the tasks are well defined, like labeling images or translating speech to text.
The technology struggles in the more open terrains of intelligence — that is, meaning, reasoning and common-sense knowledge. While deep learning software can instantly identify millions of words, it has no understanding of a concept like “justice,” “democracy” or “meddling.”
Researchers have shown that deep learning can be easily fooled. Scramble a relative handful of pixels, and the technology can mistake a turtle for a rifle or a parking sign for a refrigerator.
In a widely read article published early this year on arXiv.org, a site for scientific papers, Gary Marcus, a professor at New York University, posed the question: “Is deep learning approaching a wall?” He wrote, “As is so often the case, the patterns extracted by deep learning are more superficial than they initially appear.”

For the full story, see:
Steve Lohr. “Researchers Seek Smarter Paths to A.I.” The New York Times (Thursday, June 21, 2018): B1 & B4.
(Note: ellipses added.)
(Note: the online version of the story has the date June 20, 2018, and has the title “Is There a Smarter Path to Artificial Intelligence? Some Experts Hope So.” The June 21st date is the publication date in my copy of the National Edition.)

The essay by Jordan, mentioned above, is:
Jordan, Michael I. “Artificial Intelligence – the Revolution Hasn’t Happened Yet.” Medium.com, April 18, 2018.

The manuscript by Marcus, mentioned above, is:

Marcus, Gary. “Deep Learning: A Critical Appraisal.” Jan. 2, 2018.

We Underestimate How Entrepreneurial the Americans Were in the 1800s

(p. C6) Jim DeFelice’s “West Like Lightning,” a history of the Pony Express, begins with an anxious young rider waiting to take the news to California that Abraham Lincoln had been elected president. The delivery service lasted only about 18 months, but its revolutionary speed left an indelible mark on the country. Many, including Mark Twain, marveled at riders’ courage and the spectacle of their switching horses every 10 miles or so for a fresh burst of speed.
. . .
In what way is the book you wrote different from the book you set out to write?
Historians, God bless them, they do a lot of debunking of legends. They can sometimes come off as schoolmarms. The reality is, those legends are fun. They’re the exciting part. I separate fact and fiction, but I love those stories — and underneath them, there’s a much deeper truth. There’s a reason we value these 19- and 20-year-old kids pushing themselves against the elements.
I knew there would be some debunking involved. What I didn’t know was how true a lot of those stories turned out to be. If I were a Pony Express rider, I’d be bragging about how fast I made it. These guys didn’t brag about that — they bragged about how far they went. They were bragging about endurance and dealing with the elements. That impressed me, the resilience.
I also think sometimes we underestimate — and I’m guilty of this — just how entrepreneurial and into technology people were in the past. We think we’re cool because we can fly somewhere and be there tomorrow. But for these guys, 10 days was huge. If you gave them something in downtown New York, it would be in San Francisco two weeks later. At the time, that would be like going from dial-up to the fastest speeds we have today.

For the full interview, see:
John Williams, interviewer, ” Making Good Time and Even Better Tales.” The New York Times (Monday, May 21, 2018): C6.
(Note: ellipses added.)
(Note: the online version of the interview has the date May 20, 2018, and has the title “Tell Us 5 Things About Your Book: Making Good Time With the Pony Express.” The first paragraph and the bold question are John Williams. The paragraphs following the bold question, are Jim DeFelice’s answer.)

The book discussed in the interview quoted above, is:
DeFelice, Jim. West Like Lightning: The Brief, Legendary Ride of the Pony Express. New York: William Morrow, 2018.

Fewer Summer Jobs Filled by Teenagers

(p. D8) You can still find high school and college students boiling hot dogs and cleaning the fryer at the clam shacks, country clubs and state fairs that spring to life when the weather turns hot. But the food that fuels a summer vacation is now more likely being prepared by temporary workers from other countries or local adults trying to make the gig economy work for them.
. . .
Although youth employment in the United States still spikes in the warmer months, the number of teenagers in the summer labor force fell to 43 percent in 2016, from almost 72 percent at its peak in 1978, according to the most recent figures from the federal Bureau of Labor Statistics.
Pressure has come from several directions. School started stretching into summer. Employment laws became more restrictive. Scooping cones or running a dough-filled Hobart were no longer considered worthy résumé builders.
At the same time, demand for summer workers rose.

For the full story, see:
Kim Severson. “Where Have All the Teenagers Gone?” The New York Times (Wednesday, May 23, 2018): D8.
(Note: ellipsis added.)
(Note: the online version of the story has the date May 22, 2018, and has the title “That Summer Food-Stand Job Is No Longer Just for Teenagers.”)

Firms Transship to Avoid Tariffs

(p. B1) SHANGHAI — Want to avoid American tariffs? In China, a company called Settle Logistics says it knows a way.
Specifically, that way goes through Malaysia — a 4,600-mile diversion compared with sending a shipping container from China straight across the Pacific to the United States. But when those Chinese products arrive at an American port, they will look as if they had come from Malaysia, according to the company, and will be spared tariffs aimed at Chinese goods.
“For those unfair trade barriers targeting our industries from certain countries,” Settle Logistics says on its website, “we can adopt other approaches to bypass those trade tariffs in order to expand markets.”
Such zigzagging routes are called transshipments, and President Trump has used them to justify the trade fight he has picked with a number of countries. They could also take on new relevance should the United States and China carry out their threats to levy a total of more than $200 billion in tariffs against each other.
. . .
(p. B6) Stamping out such transshipments could prove difficult. The United States made a big effort in the late 1990s to address the relabeling in Hong Kong of garments that had been made in mainland China, said Patrick Conway, a textiles trade specialist.
But after American officials gathered enough evidence to put companies on a watch list, the companies quickly disappeared, said Mr. Conway, who is the chairman of the economics department at the University of North Carolina at Chapel Hill. Some of the same people involved emerged later, but at other companies.
“We can anticipate a game of Whac-a-Mole,” Mr. Conway said.

For the full story, see:
Keith Bradsher. “Dodging Tariffs With a Handy Detour.” The New York Times (Monday, April 23, 2018): B1 & B6.
(Note: ellipsis added.)
(Note: the online version of the story has the date April 22, 2018, and has the title “Tariff Dodgers Stand to Profit Off U.S.-China Trade Dispute.”)

For Homicides, School Is Safer Than Home or Neighborhood

(p. A13) While homicide is among the leading causes of death for young people, school is a relative haven compared with the home or the neighborhood. According to the most recent federal data, between 1992 and 2015, less than 3 percent of homicides of children 5 to 18 years old occurred at school, and less than 1 percent of suicides.
“Especially in the younger grades, school is the safest place they can be,” said Melissa Sickmund, director of the National Center for Juvenile Justice.
. . .
Chris Dorn, a senior analyst at Safe Havens International, said that after the shooting at Sandy Hook Elementary School in Newtown, Conn., in 2012, his organization saw an uptick in demand for its services, completing 1,000 school security assessments in one year. Interest is even greater now. By this fall, Safe Havens expects to have done 1,000 assessments just since the Parkland, Fla., shooting in February.
The group tells schools that the biggest safety risks have not changed, and are less likely to be mass shootings than “petty theft, assault, child abduction due to custody issues or sexual predators,” Mr. Dorn said.

For the full story, see:

Dana Goldstein. “Grim Tally Obscures Statistical Reality: Schools Are ‘Safest Place’ for Children.” The New York Times (Wednesday, May 23, 2018): A13.
(Note: ellipsis added.)
(Note: the online version of the story has the date May 22, 2018, and has the title “Why Campus Shootings Are So Shocking: School Is the ‘Safest Place’ for a Child.”)

Joe Biden Identified Theranos as “the Laboratory of the Future”

(p. C1) Theranos Inc.’s 15-year quest to revolutionize the blood-testing industry met with the latest in a series of crippling blows in March when the Securities and Exchange Commission charged the Silicon Valley diagnostics firm with conducting an “elaborate, years-long fraud.” The SEC accused the firm of deceiving investors into believing that its portable device could perform a broad range of laboratory tests on drops of blood pricked from a finger, when in fact it was doing most of its tests on commercial analyzers made by others.
Much of the attention has focused on Theranos founder Elizabeth Holmes. But another character played a central role behind the scenes in the alleged fraud: Ms. Holmes’s boyfriend, Ramesh “Sunny” Balwani, according to more than three dozen former Theranos employees who interacted with Mr. Balwani extensively over a number of years. Mr. Balwani, who met Ms. Holmes when she was a teenager, jointly ran the company with her for seven years as president and chief operating officer and enforced a corporate culture of secrecy and fear until his departure in the spring of 2016, the former employees say.
. . .
(p. C2) By the summer of 2013, the Theranos machine had gone through three iterations. The first, a microfluidic device, had been abandoned in 2007. The second, a converted glue-dispensing robot called the Edison, had been shelved in 2010. The third, which Ms. Holmes had christened the miniLab, was supposed to be the one that finally turned her vision into reality. But while she and Mr. Balwani were telling Theranos’s retail partner, Walgreens, that the miniLab could perform the full range of lab tests on tiny finger-stick samples, the truth was that it remained a work in progress, according to the SEC. The list of its problems was lengthy.
. . .
Though the miniLab remained a malfunctioning prototype, Ms. Holmes was intent on launching Theranos’s fingerstick tests in Walgreens stores by September 2013. So she and Mr. Balwani dusted off the Edison and launched with that, the SEC says. But the Edison could handle just one class of blood tests; to perform the dozens of others they had promised Walgreens their technology could handle, they needed a workaround. The solution was to secretly modify third-party commercial machines to adapt them to small blood samples.
. . .
In July 2015, Ms. Holmes invited Vice President Joe Biden to come visit Theranos’s facility in Newark, Calif. It was an audacious move given that the company’s lab had been operating without a real director since the previous December.
. . .
Ms. Holmes and Mr. Balwani wanted to impress Vice President Biden with a vision of a cutting-edge, automated laboratory. Instead of showing him the actual lab with its commercial analyzers, they created a fake one, according to former employees who worked in Newark. They made the microbiology team vacate a room it occupied, had it repainted, and lined its walls with rows of miniLabs stacked up on metal shelves.
Ms. Holmes took Mr. Biden on a tour of the facility and showed him the fake automated lab. In a discussion with a half-dozen industry executives right afterward, Mr. Biden called what he had just seen “the laboratory of the future.” Through a spokeswoman, Mr. Biden declined to comment.

For the full essay, see:
John Carreyrou, “Partners in Blood.” The Wall Street Journal (Saturday, May 19, 2018): C1-C2.
(Note: ellipses added.)
(Note: the online version of the essay has the date May 18, 2018, and has the title “Theranos Inc.’s Partners in Blood.”)

Carreyrou’s essay is derived from his book:
Carreyrou, John. Bad Blood: Secrets and Lies in a Silicon Valley Startup. New York: Alfred A. Knopf, 2018.

“Some Things Are True Even if Donald Trump Believes Them!”

(p. A21) One of the hardest things to accept for all of us who want Donald Trump to be a one-term president is the fact that some things are true even if Donald Trump believes them! And one of those things is that we have a real trade problem with China. Imports of Chinese goods alone equal two-thirds of the global U.S. trade deficit today.
. . .
. . . , I sat down with David Autor, the M.I.T. economist who’s done some of the most compelling research on the impacts of China trade. The first problem he raised has to do with the “shock” that China delivered to U.S. lower-tech manufacturers in the years right after Beijing joined the World Trade Organization in 2001, when it gained more open access to the U.S. and other world markets.
. . .
Autor and his colleagues David Dorn and Gordon Hanson found in a 2016 study that roughly 40 percent of the decline in U.S. manufacturing between 2000 and 2007 was due to a surge in imports from China primarily after it joined the W.T.O. And it led to the sudden loss of about one million factory jobs in Ohio, Michigan, Wisconsin and Pennsylvania. Trump won all of those states.
This “China shock,” said Autor, led not only to mass unemployment but also to social disintegration, less marriage, more opioid abuse and more people dropping out of the labor market and requiring government aid. “International trade creates diffuse benefits and concentrated costs,” he added. “China’s rapid rise, while enormously positive for world welfare, has created identifiable losers in trade-impacted industries and the labor markets in which they are located.”
The second problem has to do with access to China’s market for the goods U.S. companies sell. There, noted Autor, “China has not only taken our lunch, they’ve opened a restaurant that’s serving it to their citizens.”
. . . China kept a 25 percent tariff on new cars imported from the U.S. (our tariff is 2.5 percent) and similarly steep tariffs on imported auto parts.

For the full commentary, see:

Friedman, Thomas L.. “Trump’s Right About China, To a Point.” The New York Times (Wednesday, March 14, 2018): A21.
(Note: ellipses added; italics in original.)
(Note: the online version of the commentary has the date March 13, 2018, and has the title “Some Things Are True Even if Trump Believes Them.” My print edition is in this case, and is almost always, the National Edition. I have discovered that sometimes the page number, and even the title and date, differ between the National and the New York print editions.)

The Autor co-authored paper mentioned above, is:

Autor, David H., David Dorn, and Gordon H. Hanson. “The China Shock: Learning from Labor Market Adjustment to Large Changes in Trade.” Annual Review of Economics (2016): 205-40.

Wages Rise as Fast-Food Jobs Go Unfilled

(p. A10) . . . in an industry where cheap labor is an essential component in providing inexpensive food, a shortage of workers is changing the equation upon which fast-food places have long relied. This can be seen in rising wages, in a growth of incentives, and in the sometimes odd situations that business owners find themselves in.
This is why Jeffrey Kaplow, for example, spends a lot of time working behind the counter in his Subway restaurant in Lower Manhattan. It’s not what he pictured himself doing, but he simply doesn’t have enough employees.
Mr. Kaplow has tried everything he can think of to find workers, placing Craigslist ads, asking other franchisees for referrals, seeking to hire people from Subways that have closed.

For the full story, see:
Rachel Abrams and Robert Gebeloff. “A Fast-Food Problem: Where Have All The Teenagers Gone?” The New York Times (Friday, May 4, 2018): B1 & B5.
(Note: ellipsis added.)
(Note: the online version of the story has the date May 3, 2018.)

Silicon Valley Venture Capitalists “Fantasize about Relocating” to “Detroit and South Bend”

(p. B1) It was pitched as a kind of Rust Belt safari — a chance for Silicon Valley investors to meet local officials and look for promising start-ups in overlooked areas of the country.
But a funny thing happened: By the end of the tour, the coastal elites had caught the heartland bug. Several used Zillow, the real estate app, to gawk at the availability of cheap homes in cities like Detroit and South Bend and fantasize about relocating there. They marveled at how even old-line manufacturing cities now offer a convincing simulacrum of coastal life, complete with artisanal soap stores and farm-to-table restaurants.
. . .
(p. B4) Mr. McKenna, who owns a house in Miami in addition to his home in San Francisco, told me that his travels outside the Bay Area had opened his eyes to a world beyond the tech bubble.
“Every single person in San Francisco is talking about the same things, whether it’s ‘I hate Trump’ or ‘I’m going to do blockchain and Bitcoin,'” he said. “It’s the worst part of the social network.”
. . .
Recently, Peter Thiel, the President Trump-supporting billionaire investor and Facebook board member, became Silicon Valley’s highest-profile defector when he reportedly told people close to him that he was moving to Los Angeles full-time, and relocating his personal investment funds there. (Founders Fund and Mithril Capital, two other firms started by Mr. Thiel, will remain in the Bay Area.) Mr. Thiel reportedly considered San Francisco’s progressive culture “toxic,” and sought out a city with more intellectual diversity.
Mr. Thiel’s criticisms were echoed by Michael Moritz, the billionaire founder of Sequoia Capital. In a recent Financial Times op-ed, Mr. Moritz argued that Silicon Valley had become slow and spoiled by its success, and that “soul-sapping discussions” about politics and social injustice had distracted tech companies from the work of innovation.
Complaints about Silicon Valley insularity are as old as the Valley itself. Jim Clark, the co-founder of Netscape, famously decamped for Florida during the first dot-com era, complaining about high taxes and expensive real estate. Steve Case, the founder of AOL, has pledged to invest mostly in start-ups outside the Bay Area, saying that “we’ve probably hit peak Silicon Valley.”
. . .
This isn’t a full-blown exodus yet. But in the last three months of 2017, San Francisco lost more residents to outward migration than any other city in the country, according to data from Redfin, the real estate website. A recent survey by Edelman, the public relations firm, found that 49 percent of Bay Area residents, and 58 percent of Bay Area millennials, were considering moving away. And a sharp increase in people moving out of the Bay Area has led to a shortage of moving vans. (According to local news reports, renting a U-Haul for a one-way trip from San Jose to Las Vegas now costs roughly $2,000, compared with just $100 for a truck going the other direction.)

For the full commentary, see:
Kevin Roose. “THE SHIFT; Silicon Valley Toured the Heartland and Fell in Love.” The New York Times (Monday, March 5, 2018): B1 & B4.
(Note: ellipses added.)
(Note: the online version of the commentary has the date March 4, 2018, and has the title “THE SHIFT; Silicon Valley Is Over, Says Silicon Valley.”)

“The Future Is Rich in Opportunity”

(p. A13) Ken Langone, 82, investor, philanthropist and founder of Home Depot, has written an autobiography that actually conveys the excitement of business–of starting an enterprise that creates a job that creates a family, of the joy of the deal and the place of imagination in the making of a career. Its hokey and ebullient name is “I Love Capitalism” which I think makes his stand clear.
. . .
Can capitalism win the future? “Yes, but we have to be more emphatic and forthright about what it is and its benefits. A rising tide does lift boats.”
Home Depot has changed lives. “We have 400,000 people who work there, and we’ve never once paid anybody minimum wage.” Three thousand employees “came to work for us fresh out of high school, didn’t go to college, pushing carts in the parking lot. All 3,000 are multimillionaires. Salary, stock, a stock savings plan.”
Mr. Langone came up in the middle of the 20th century–the golden age of American capitalism. Does his example still pertain to the 21st? Yes, he says emphatically: “The future is rich in opportunity.” To see it, look for it. For instance: “Look, people are living longer. They’re living more vibrant lives, more productive. This is an opportunity to accommodate the needs of older people. Better products, cheaper prices–help them get what they need!”
Mr. Langone grew up in blue-collar Long Island, N.Y. Neither parent finished high school. His father was a plumber who was poor at business; his mother worked in the school cafeteria. They lived paycheck to paycheck. He was a lousy student but he had one big thing going for him: “I loved making money.” He got his first job at 11 and often worked two at a time–paperboy, butcher-shop boy, caddie, lawn work, Bohack grocery clerk. He didn’t mind: “I wanted to be rich.”

For the full commentary, see:
Peggy Noonan. “DECLARATIONS; Wisdom of a Non-Idiot Billionaire.” The Wall Street Journal (Saturday, May 12, 2018): A13.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date May 10, 2018.)

The book mentioned in the commentary, is:
Langone, Ken. I Love Capitalism!: An American Story. New York: Portfolio, 2018.