Author: Art Diamond

Entrepreneur Stewart Butterfield Failed With “Glitch” Before Succeeding With “Slack”

(p. A15) Entrepreneur Stewart Butterfield once tried to build a multiplayer online game but switched to photo sharing, selling Flickr to Yahoo in 2005 for $25 million. Success, but not a home run in Silicon Valley. Mr. Butterfield left Yahoo in 2008 to help found a company called Tiny Speck and build another multiplayer online game called “Glitch.” Persistence! “Glitch” attracted tens of thousands of gamers, but not enough to cover its costs, so Mr. Butterfield killed it in 2012.

Tiny Speck pivoted, which in Silicon Valley means fail and scramble to do something else. The company had built its own crude internal communications system for employees to chat digitally during the development of “Glitch.” Maybe others would use it. Seven months after they started work on Slack, the company announced its preview release. On the first day of the press blitz, 8,000 people requested the preview version. In February 2014 Slack had 16,000 users and by November it had 285,000, with 73,000 paying for it. Now more than 10 million people use it daily. Mr. Butterfield sold Slack to Salesforce for $27.7 billion last year. That’s failing upward!

For the full commentary, see:

Andy Kessler. “INSIDE VIEW; Failure Is Always an Option.” The Wall Street Journal (Monday, Oct. 18, 2021): A15.

(Note: the online version of the commentary has the date October 17, 2021, and has the title “INSIDE VIEW; Failure Was Always an Option for Elizabeth Holmes.”)

Virtual Reality (VR) Used to Better See Cancer Cell Mutations

(p. R3) Chemist and entrepreneur Jackie von Salm recently walked inside a receptor in the brain to inspect a new drug compound. As she looked at the brightly colored, cascading ribbons around her, she noted something: Part of the atomic structure, a series of thick, orange rods and hexagons, jutted toward her in an odd way, suggesting that the compound, a derivative of the psychedelic DMT, might be effective at treating addiction without having hallucinogenic effects.

“This is weird,” says Dr. von Salm, the co-founder and chief scientific officer of Psilera Inc., a Tampa, Fla.-based company working to turn psychedelics into treatments for addiction, neurodegenerative diseases and mood disorders. “But it might be really unique and special.”

The odd positioning of the compound might be the right shape to latch onto serotonin receptors in the brain that are involved with hallucination and addiction. That insight was possible thanks to a technology more closely associated with gamers than scientists: Virtual reality.

Dr. von Salm is one of a growing number of drug-discovery researchers who are using VR to see, in new ways, the molecules they have long studied on computer screens. Their goal is to investigate subtle changes in the distance, shape and chemical properties of atomic structures that could give them clues about how well a drug might work and speed up the drug-discovery process.

. . .

Since 2018, cancer researchers at the University of California San Francisco have been using VR to better understand the genetic mutations in cancer cells that might make a patient resistant to treatment. For example, in VR, it was clear that the reason a drug didn’t bind properly to its protein target in the cancer cell was because of the movement of a portion of the protein called the P-loop. The movement was caused by a mutation in the target.

On a computer monitor, it was difficult to see the tiny change in the movement. “When there are changes like that, the VR is critical,” says Beth Apsel Winger, a hematologist and oncologist at the university’s department of pediatrics.

For the full commentary, see:

Sara Castellanos. “VR Rx.” The Wall Street Journal (Friday, Sept. 10, 2021): R3.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date September 7, 2021, and has the title “Virtual Reality Puts Drug Researchers Inside the Molecules They Study.”)

Absence of Covid-19 in 9,000 Chinese Samples from Late 2019 Supports Lab-Leak Theory

(p. A17) Where did Covid-19 come from? The answer can be found in the SARS-CoV-2 virus itself. To get to the truth, we need only unleash the power of science.

Based on experience with SARS-1 in 2003 and MERS in 2012, we know that many people are infected by a host animal long before a coronavirus mutates to the point where it can jump from human to human. An extensive data set from late 2019—more than 9,000 hospital samples—is available of people exhibiting flulike (thus Covid-like) symptoms in China’s Hubei and Shaanxi provinces before the epidemic started. Based on SARS-1 and MERS, the natural zoonotic theory predicts 100 to 400 Covid infections would be found in those samples. The lab-leak hypothesis, of course, predicts zero. If the novel coronavirus were engineered by scientists pursuing gain-of-function research, there would be no instances of community infection until it escaped from the laboratory. The World Health Organization investigation analyzed those stored samples and found zero pre-pandemic infections. This is powerful evidence favoring the lab-leak theory.

Within months of the SARS-1 and MERS outbreaks, scientists found animals that had hosted the viruses before they made the jump to humans. More than 80% of the animals in affected markets were infected with a coronavirus. In an influential March 2020 paper in Nature Medicine, Kristian Andersen and co-authors implied that a host animal for SARS-CoV-2 would soon be found. If the virus had been cooked up in a lab, of course, there would be no host animal to find.

Chinese scientists searched for a host in early 2020, testing more than 80,000 animals from 209 species, including wild, domesticated and market animals. As the WHO investigation reported, not a single animal infected with SARS-CoV-2 was found. This finding strongly favors the lab-leak theory. We can only wonder if the results would have been different if the animals tested had included the humanized mice kept at the Wuhan Institute of Virology.

For the full commentary, see:

Richard Muller and Steven Quay. “Science Closes In on Covid’s Origins.” The Wall Street Journal (Wednesday, Oct. 6, 2021): A17.

(Note: the online version of the commentary has the date October 5, 2021, and has the same title as the print version.)

Rogge and Friedman on Bread and Freedom

At the start and end of the movie above, you can hear the voice and thoughts of my Wabash College mentor Ben Rogge. His interview of Milton Friedman at the end is especially wonderful if you are a libertarian fan of Rogge and Friedman. I believe Rogge had an important hand in the production of this movie, as he did in a couple of movies from Liberty Fund. I think he also advised Milton Friedman on his famous “Free to Choose” television series. Rogge was a libertarian intellectual entrepreneur, who encouraged and enabled many now-more-famous libertarians to think, write, and speak. Whether he is remembered or forgotten, Rogge made a difference.

The movie is based on the book of the same title:

Brown, Susan Love, Karl Keating, David Mellinger, Patrea Post, Stuart Smith, and Catriona Tudor. The Incredible Bread Machine. San Diego: World Research, Inc., 1975.

(Note: the book is based on a poem by R.W. Grant that had the title “Tom Smith and His Incredible Bread Machine.” I believe, but have not confirmed my memory, that a version of Grant’s poem appears in the book by Love et al.)

Former Teacher Union President Says Charter Schools Give Black and Hispanic Children “Access to a Quality Education”

(p. A21) When I became a teacher, it seemed natural to become an advocate for the profession. Somewhere along the way I became more of a union leader than an educational leader.

. . .

I used to oppose charter schools, not because they were bad for kids, but because they were bad for unions.

. . .

I served as president of the Washington Teachers’ Union for six years and recognize the added value unions can bring in securing fair compensation and safe working conditions for teachers. I’m still a union member. But I now work on behalf of charter schools.

Charter schools are also public schools. All of them. They provide more than three million students, mostly black and Hispanic, access to a quality public education. They are innovative and student-centered. They break down barriers that have kept families of color from the educational opportunities they deserve. Another two million children would attend charter schools if there were space for them. How could I work against these kids?

For the full commentary, see:

George Parker. “How My Mind Opened to Charter Schools.” The Wall Street Journal (Thursday, May 27, 2021): A21.

(Note: ellipses added.)

(Note: the online version of the commentary has the date May 26, 2021, and has the same title as the print version.)

FTC Slows Serendipitously Discovered Blood Test That Detects 50 Types of Cancer

(p. A13) Scientific breakthroughs are sometimes a matter of serendipity. Eight years ago Meredith Halks-Miller, a pathologist at the genetic-screening company Illumina, stumbled on something unusual while running prenatal blood tests for fetal chromosomal abnormalities. In some blood samples, the fetal genes were normal but the maternal DNA wasn’t. Illumina alerted pregnant women’s doctors to the finding. After further investigation, all the women were diagnosed with cancer, though none had symptoms when their blood was drawn.

This discovery led to the development of a blood test that can now detect 50 types of cancer and has the potential to save tens of thousands of lives a year if it becomes widely available. But regulators may slow the process.

The Federal Trade Commission last month wrapped up an administrative trial in which it seeks to block Illumina’s $8 billion acquisition of Grail, which makes the blood test.

. . .

Grail projects its test could prevent 90,000 to 100,000 cancer deaths each year if it were administered annually to all Americans 50 to 79. The sooner people get access to the test, the more lives will be saved. Illumina estimates that 10,000 lives will be saved over the following nine years for every year that it accelerates bringing the test to market. “By accelerating the global rollout of the test in the European Union, into Africa, into Asia, into Latin America, we believe we can save a lot more lives than that around the world,” Mr. deSouza says.

The company’s dominance in the DNA-testing market, however, attracted regulatory scrutiny. In March the FTC sued Illumina and Grail to block the acquisition, arguing that it would “lessen competition in the U.S. multi-cancer early detection (‘MCED’) test market by diminishing innovation and potentially increasing prices.”

Nonsense, Mr. deSouza says. “Today, there is nobody who is even starting the studies to develop a 50-cancer test like Grail, and once you start the study, it’s still a few years before you actually get the test. We think there will also be blood tests for single cancers, for colorectal cancer and other cancers. Those won’t compete with Grail. They will be complementary to Grail.”

For the full interview, see:

Allysia Finley, interviewer. “THE WEEKEND INTERVIEW; Regulatory Hurdles Block a Cancer Miracle.” The Wall Street Journal (Saturday, Oct. 9, 2021): A13.

(Note: ellipsis added.)

(Note: the online version of the interview has the date October 8, 2021, and has the same title as the print version.)

Amazon Hiring 55,000 Workers

(p. B3) Amazon.com Inc. said it is seeking to hire about 55,000 people globally among its corporate and technology ranks during a recruiting event set for Sept. 15, [2021] as the e-commerce giant continues a hiring spree begun at start of the Covid-19 pandemic.

The Seattle-based company is aiming to fill roles in cloud-computing unit Amazon Web Services, as well as in divisions such as Amazon Studios, advertising and its broadband satellite Project Kuiper. The open positions include more than 40,000 roles in the U.S. across 220 locations, including in New York City; Bellevue, Wash.; and Arlington, Va., where the company is opening a large corporate office.

. . .

The company employs about 950,000 people in the U.S. and has said it has made more than 450,000 hires throughout the country since the public-health crisis began.

For the full story, see:

Dave Sebastian. “Amazon Seeks to Hire 55,000 for Office, Tech Roles.” The Wall Street Journal (Thursday, Sept. 2, 2021): B3.

(Note: ellipsis, and bracketed year, added.)

(Note: the online version of the story was updated Sept. 1, 2021, and has the title “Amazon Seeks to Hire 55,000 for Corporate, Tech Roles.”)

“The Best Recipe for Economic Growth Is” Freedom and Opportunity

(p. C3) Migration has been central to the American story since the beginning. In the early 19th century, New Englanders left the rocky soil of Massachusetts for the more fertile Ohio River valley. During the Dust Bowl of the 1930s, farmers fled Oklahoma for California. In the early 20th century, millions of African-Americans left the Jim Crow South to find work in the factories of northern cities. Through the 20th century, mobility was an American tradition: In every year between 1950 and 1992, according to the Current Population Survey, more than 6% of Americans moved across county lines.

In recent years, however, the engine of American migration has been grinding to a halt. People often move to get ahead, which makes mobility a reasonable measure of economic dynamism. So it’s a troubling sign that since 2007, geographic mobility has dropped by one-third, with fewer than 4% of Americans changing counties annually. The reason is clear: In the most prosperous cities and regions, insiders have figured out how to use regulations, laws and institutions to make life easier for themselves and harder for everyone else. In the process, they have made the U.S. a far less dynamic society.

. . .

Most important, we need to stop thinking of growth as a zero-sum game. Today, insiders worry about getting their share of the pie instead of growing the economy for everyone. The best recipe for economic growth is the traditional American one: freedom, combined with robust investment in opportunity for the least advantaged.

For the full commentary, see:

Edward Glaeser and David Cutler. “The American Housing Market Is Stifling Mobility.” The Wall Street Journal (Saturday, July 17, 2021): C3.

(Note: ellipses added.)

(Note: the online version of the commentary has the date September 2, 2021, and has the same title as the print version.)

The commentary quoted above is based on the authors’ book:

Glaeser, Edward L., and David Cutler. Survival of the City: Living and Thriving in an Age of Isolation. New York: Penguin Press, 2011.

Walmart Hiring 20,000 Workers

(p. B3) Walmart Inc. is hiring 20,000 workers for its supply-chain operations ahead of the holidays, highlighting the growing role of distribution and delivery as the retailer competes with e-commerce giant Amazon.com Inc.

The new hires will be permanent positions aimed at supporting Walmart through the holiday surge and beyond, the retailer said Wednesday [Sept. 1, 2021]. The full- and part-time jobs range from order pickers, freight handlers and forklift operators to technician and management roles at more than 250 Walmart and Sam’s Club distribution and fulfillment centers and transportation offices.

For the full story, see:

Jennifer Smith. “Walmart Plans to Add 20,000 Workers.” The Wall Street Journal (Thursday, Sept. 02, 2021): B3.

(Note: bracketed date added.)

(Note: the online version of the story was updated Sept. 1, 2021, and has the title “Walmart Will Add 20,000 Workers to Supply-Chain Operations This Year.”)

Insurers Are Paid More When They Negotiate HIGHER Prices for Patients

(p. A1) This year, the federal government ordered hospitals to begin publishing a prized secret: a complete list of the prices they negotiate with private insurers.

The insurers’ trade association had called the rule unconstitutional and said it would “undermine competitive negotiations.” Four hospital associations jointly sued the government to block it, and appealed when they lost.

They lost again, and seven months later, many hospitals are simply ignoring the requirement and posting nothing.

But data from the hospitals that have complied hints at why the powerful industries wanted this information to remain hidden.

It shows hospitals are charging patients wildly different amounts for the same basic services: procedures as simple as an X-ray or a pregnancy test.

And it provides numerous examples of major health insurers — some of the world’s largest companies, with billions in annual profits — negotiating surprisingly unfavorable rates for their customers. In many cases, insured patients are getting prices that are higher than they would if they pretended to have no coverage at all.

. . .

(p. A14) Customers judge insurance plans based on whether their preferred doctors and hospitals are covered, making it hard for an insurer to walk away from a bad deal. The insurer also may not have a strong motivation to, given that the more that is spent on care, the more an insurance company can earn.

Federal regulations limit insurers’ profits to a percentage of the amount they spend on care. And in some plans involving large employers, insurers are not even using their own money. The employers pay the medical bills, and give insurers a cut of the costs in exchange for administering the plan.

. . .

People carefully weighing two plans — choosing a higher monthly cost or a larger deductible — have no idea that they may also be picking a much worse price when they later need care.

Even for simple procedures, the difference can be thousands of dollars, enough to erase any potential savings.

It’s not as if employers can share that information at open enrollment: They generally don’t know either.

“It’s not just individual patients who are in the dark,” said Martin Gaynor, a Carnegie Mellon economist who studies health pricing. “Employers are in the dark. Governments are in the dark. It’s just astonishing how deeply ignorant we are about these prices.”

. . .

Health economists think of insurers as essentially buying in bulk, using their large membership to get better deals. Some were startled to see numerous instances in which insurers pay more than the cash rate.

. . .

“The worrying thing is that the third party you’re paying to negotiate on your behalf isn’t doing as well as you would on your own,” said Zack Cooper, an economist at Yale who studies health care pricing.

. . .

(p. A15) Hospitals and insurers can also hide behind the contracts they’ve signed, which often prohibit them from revealing their rates.

“We had gag orders in all our contracts,” said Richard Stephenson, who worked for the Blue Cross Blue Shield Association from 2006 until 2017 and now runs a medical price transparency start-up, Redu Health. (The association says those clauses have become less common.)

Mr. Stephenson oversaw a team that made sure the gag orders were being followed. He said he thought insurers were “scared to death” that if the data came out, angry hospitals or doctors might leave their networks.

. . .

The new price data is often published in hard-to-use formats designed for data scientists and professional researchers. Many are larger than the full text of the Encyclopaedia Britannica.

And most hospitals haven’t posted all of it. The potential penalty from the federal government is minimal, with a maximum of $109,500 per year. Big hospitals make tens of thousands of times as much as that; N.Y.U. Langone, a system of five inpatient hospitals that have not complied, reported $5 billion in revenue in 2019, according to its tax forms.

For the full story, see:

Sarah Kliff, Josh Katz and Rumsey Taylor. “Hospital Data Reveals Secrets Behind Billing.” The New York Times (Monday, August 23, 2021): A1 & A14-A15.

(Note: the online version of the story has the date Aug. 22, 2021, and has the title “Hospitals and Insurers Didn’t Want You to See These Prices. Here’s Why.”)

$80 Billion in 200 Large Projects to Develop Hydrogen as Clean Energy Source

(p. B1) SHEFFIELD, England — Rachel Smith has lived through green hydrogen’s bumpy journey from scientists’ dream to an industry that may be on the verge of a commercial breakthrough. An engineer, she started out two decades ago working in a converted barn on early devices for making the clean-burning gas.

Now she is part of a team racing to build giant machines that will use electricity to separate hydrogen from water for major companies like Royal Dutch Shell and Orsted, the Danish offshore wind developer.

“We have gone through those toddler years,” said Ms. Smith, an executive director at ITM Power, which is run out of an expansive new factory in Sheffield, a faded center for steel mills and coal mining. “We are playing in the grown-up world rather than in research labs.”

A consensus is forming among governments, environmentalists and energy companies that deep cuts in carbon emissions will require large amounts of a clean fuel like hydrogen.

Proponents of hydrogen have identified more than a score of potential applications of the element for cutting carbon emissions. It could be used to power long-haul trucks and train and air travel. Energy companies are experimenting with blending hydrogen with natural gas for home heating and cooking.

All told, more than 200 large-scale projects are underway to produce or transport hydrogen, comprising investments of more than $80 billion. Daimler and Volvo, the world’s largest truck makers, plan in a few years to begin mass producing long-haul electric trucks that run on devices called fuel cells that convert hydrogen to electricity. Water will be the trucks’ only emission.

“You could imagine an economy that is supported almost entirely by very clean electricity and very clean hydrogen,” said Ernest Moniz, secretary of energy in the Obama administration and now chief executive of the Energy Futures Initiative, a research organization.

(p. B5) But he warned that “a lot of things have to happen” for a gas now mainly used in specialty areas to become a “part of the backbone of the energy system.”

Among the obstacles that must be overcome: creating enough of the right sort of hydrogen, at a price industries and consumers can accept.

For the full story, see:

Stanley Reed and Jack Ewing. “The Race to Harvest Hydrogen.” The New York Times (Saturday, July 17, 2021): B1 & B5.

(Note: the online version of the story has the date June 4, 2021, and has the title “Hydrogen Is One Answer to Climate Change. Getting It Is the Hard Part.”)