(p. A1) SPRINGFIELD, Mo.— Steve Stepp and his team of septuagenarian engineers are using a bag of rust, a kitchen mixer larger than a man and a 62-foot-long contraption that used to make magnetic strips for credit cards to avert a disaster that no one saw coming in the digital-music era.
The world is running out of cassette tape.
National Audio Co., where Mr. Stepp is president and co-owner, has been hoarding a stockpile of music-quality, ⅛-inch-wide magnetic tape from suppliers that shut down in the past 15 years after music lovers ditched cassettes. National Audio held on. Now, many musicians are clamoring for cassettes as a way to physically distribute their music.
The company says it has less than a year’s supply of tape left. So it is building the first manufacturing line for (p. A10) high-grade ferric oxide cassette tape in the U.S. in decades. If all goes well, the machine will churn out nearly 4 miles of tape a minute by January. And not just any tape. “The best tape ever made,” boasts Mr. Stepp, 69 years old. “People will hear a whole new product.” Continue reading “Firm Revives Cassette Tape Production”
Category: Entrepreneurship
Boston Brahmins Invested in Western Industrialization
(p. A13) One of history’s ironies is that, even though New England birthed the abolition movement, many of Boston’s most prominent families offered less than total support for freeing the slaves. Their prosperity required a steady supply of cotton to feed New England’s growing textile industry. Even after slavery ended in 1865, wealthy Bostonians were reluctant to abandon their traditional business. Henry Lee Higginson, 30 years old and freshly discharged from the Union Army, bought with his partners a 5,000-acre plantation in Georgia with the goal of turning a profit by growing cotton. But the 60 former slaves living on the plantation thought the wages and terms offered to be grossly inadequate; the land they had worked in chains for generations, they believed, should belong to them. The enterprise soon collapsed.
As similar episodes played out across the South, Boston’s business elites looked for new places to invest their money. “They began to reenvision American capitalist development, not in modifying and salvaging the arrangements of earlier decades but in a far more ambitious program of continental industrialization,” Noam Maggor writes in “Brahmin Capitalism.” “They retreated from cotton and moved into a host of groundbreaking ventures in the Great American West—mining, stockyards, and railroads.”
. . .
Especially representative of the Bostonians’ transformative influence was Higginson’s next enterprise. Far removed from Georgian cotton, his interests landed on a copper mine in northern Michigan’s remote Keweenaw Peninsula. Copper had been discovered there 20 years earlier, but extraction had been small-scale and labor intensive; the high cost per unit meant that mining was profitable only for veins that contained at least 40% copper. In a short time, high-yield mines in the area began to show signs of depletion. But with Higginson’s capital—alongside investments from other Brahmins—large-scale copper extraction could take place as a continuous operation, making mining profitable on belts that contained only 2%-4% copper. In this way, Higginson’s Eastern capital transformed Western mining and launched a career that would make him one of Boston’s leading financiers.
For the full review, see:
(Note: ellipsis added.)
(Note: the online version of the review has the date June 25, 2017, and has the same title as the print version.)
The book under review is:
Maggor, Noam. Brahmin Capitalism: Frontiers of Wealth and Populism in America’s First Gilded Age. Cambridge, MA: Harvard University Press, 2017.
How Drinking Coffee Makes Us Younger and More Open-Minded
(p. C2) . . . , if a baby monkey heard a new sound pattern many times, her neurons (brain cells) would adjust to respond more to that sound pattern. Older monkeys’ neurons didn’t change in the same way.
At least part of the reason for this lies in neurotransmitters, chemicals that help to connect one neuron to another. Young animals have high levels of “cholinergic” neurotransmitters that make the brain more plastic, easier to change. Older animals start to produce inhibitory chemicals that counteract the effect of the cholinergic ones. They actually actively keep the brain from changing.
. . .
In the new research, Jay Blundon and colleagues at St. Jude Children’s Research Hospital in Memphis, Tenn., tried to restore early-learning abilities to adult mice. As in the earlier experiments, they exposed the mice to a new sound and recorded whether their neurons changed in response. But this time the researchers tried making the adult mice more flexible by keeping the inhibitory brain chemicals from influencing the neurons.
In some studies, they actually changed the mouse genes so that the animals no longer produced the inhibitors in the same way. In others, they injected other chemicals that counteracted the inhibitors. (Caffeine seems to work in this way, by counteracting inhibitory neurotransmitters. That’s why coffee makes us more alert and helps us to learn.)
In all of these cases in the St. Jude study, the adult brains started to look like the baby brains.
For the full commentary, see:
(Note: ellipses added.)
(Note: the online version of the commentary has the date July 7, 2017, and has the same title as the print version.)
The article co-authored by Jay Blundon and mentioned above,is:
Entrepreneurs Make Millions from Selling Cheaper Ice Cream
(p. A25) Curtis and S. Prestley Blake opened Friendly (the chain became Friendly’s in 1989) with a $547 loan from their parents in their hometown, Springfield, Mass., in the summer of 1935. With the Depression gripping the country, the brothers enticed customers by selling two scoops of ice cream for a nickel, about half the price their competitors charged (and the equivalent of about 95 cents today).
“Our customers didn’t have any money, and neither did we,” Mr. Blake told The Republican, a Springfield newspaper, in 2017.
Their shop was an instant success, with a line out the door on opening night. But it required constant labor.
. . .
Mr. Blake and his brother sold Friendly to the Hershey Foods Corporation in 1979 for about $164 million (nearly $580 million in today’s dollars).
For the full obituary, see:
(Note: ellipsis added.)
(Note: the online version of the obituary has the date May 30, 2019, and has the title “Hong Kong Protesters Descend on Airport, With Plans to Stay for Days.”)
When Labor Market Regulations Increase, Firms Hire Fewer Workers
(p. B5) “It’s serial stagnation,” said Nicola Borri, a finance professor at Luiss, a university in Rome. “The economy doesn’t contract, it doesn’t grow. Italy is a country that is weak, that is old, where there is no investment in new ideas.”
. . .
Thirty-five miles east of Naples, in the town of Avellino, Sabino Basso has halted plans to hire 30 more people at the olive oil bottling plant started by his great-grandfather.
Mr. Basso’s company buys olive oil from growers in Italy, Spain and Greece, exporting 80 percent of its wares to countries around the globe — especially the United States, where Walmart is a major customer. He had planned to increase marketing and online sales.
But then Five Star tightened legal requirements for companies that hire workers on temporary contracts, effectively limiting stints to one year. The change was aimed at forcing businesses to hire permanent workers.
Mr. Basso was aghast. All but five of his 100 workers are permanent, he said. The others are apprentices, a status that has allowed him to hire using temporary contracts.
“In order to understand if I want to keep people their whole lives, I have to test them,” he said. The new rules did not allow him sufficient time. “I just stopped hiring.”
For the full story, see:
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 9, 2019, and has the title “Italy’s Biggest Economic Problem? It’s Still Italy.”)
A.I. Needs Human Beings to Collect Right Data and Write Sound Algorithms
(p. A1) SEATTLE — The company called One Concern has all the characteristics of a buzzy and promising Silicon Valley start-up: young founders from Stanford, tens of millions of dollars in venture capital and a board with prominent names.
Its particular niche is disaster response. And it markets a way to use artificial intelligence to address one of the most vexing issues facing emergency responders in disasters: figuring out where people need help in time to save them.
. . .
But when T.J. McDonald, who works for Seattle’s office of emergency management, reviewed a simulated earthquake on the company’s damage prediction platform, he spotted problems. A popular big-box store was grayed out on the web-based map, meaning there was no analysis of the conditions there, and shoppers and workers who might be in danger would not receive immediate help if rescuers relied on One Concern’s results.
“If that Costco collapses in the middle of the day, there’s going to be a lot of people who are hurt,” he said.
The error? The simulation, the company acknowledged, missed many commercial areas because damage calculations relied largely on residential census data.
For the full story, see:
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 9, 2019, and has the title “This High-Tech Solution to Disaster Response May Be Too Good to Be True.”)
Evidence That Patents Do Not Holdup Innovation
(p. A17) The trade war has highlighted the competitive advantage of reliable patent rights in driving innovation, prompting a bipartisan effort in Congress to strengthen patents.
. . .
Yet the FTC doesn’t seem to have received the message. It continues to push regulatory policies and undertake enforcement actions based on the story that bad actors licensing their patents somehow are stopping companies from making new innovative products and are harming consumers with higher prices. This idea that “patent holdup” raises prices and stifles innovation is based entirely on an academic theory first proposed in the Texas Law Review in 2007 by professors Mark Lemley and Carl Shapiro.
In contrast to the theory, extensive empirical research since 2007 has failed to find any of the predicted harms of stifled innovation or higher prices, and has in fact found the opposite. “An Empirical Examination of Patent Holdup,” published in 2015, found that industries like smartphone design with patents on foundational technologies have the fastest quality-adjusted price reductions in consumer products. A 2016 George Mason Law Review study also found consistent reductions in consumer prices, increased research-and-development spending, and incredibly fast technological innovation driven by patent licensing of key technologies in the smartphone industry.
For the full commentary, see:
(Note: ellipsis added.)
(Note: the online version of the commentary has the same date and title as the print version.)
The 2016 George Mason Law Review study, mentioned above, is:
The 2015 paper mentioned above, is:
Galetovic, Alexander, Stephen Haber, and Ross Levine. “An Empirical Examination of Patent Holdup.” Journal of Competition Law and Economics 11, no. 3 (Sept. 2015): 549-78.
A related 2017 paper, is:
Galetovic, Alexander, and Stephen Haber. “The Fallacies of Patent-Holdup Theory.” Journal of Competition Law and Economics 13, no. 1 (March 2017): 1-44.
Rosenwald Philanthropy Aimed at Self-Help More Than Social Change
(p. A15) At the beginning of the 20th century, three figures dominated the rapidly expanding world of American philanthropy. Two—Andrew Carnegie and John D. Rockefeller—are still remembered, mostly because of the foundations they established. But the third—Julius Rosenwald—is largely forgotten. No foundations, and few buildings, bear his name. If his approach to giving was more modest in spirit, it was no less influential and effective in its day.
. . .
. . . , Rosenwald invested in a catalog sales company that needed capital: Sears, Roebuck. He gradually became more involved in the business and, when co-founder Richard Sears resigned in 1908, took over its leadership.
. . .
Because the rise and fall of Sears, Roebuck is already well-chronicled, Ms. Diner, a professor of American Jewish history at New York University, concentrates on what Rosenwald did with the status and fortune he accumulated. By one estimate, he donated, in today’s dollars, close to $2 billion before he died in 1932, as well as considerable time to the causes he cared about.
Many of these centered on his hometown of Chicago. Rosenwald’s gifts helped to create the city’s Museum of Science and Industry, build the University of Chicago, and support the settlement houses run by Jane Addams and others. He also underwrote a wide range of Jewish organizations, including cultural institutes, theological seminaries and, most notably, the American Jewish Joint Distribution Committee, a fund that was set up during World War I to aid Jewish refugees and that has continued to do so ever since.
The most striking part of Rosenwald’s philanthropy may well be his funding of African-American education in the South. Influenced by Booker T. Washington, he developed a program to construct elementary and secondary schools in any black community that wanted such support. Over a 20-year period, nearly 5,000 schools opened.
. . .
For both Jewish immigrants in the slums of Chicago and black sharecroppers in the rural South, Rosenwald’s philanthropy sought to promote practical efforts at self-improvement, not ambitious plans for social change.
For the full review, see:
(Note: ellipses added.)
(Note: the online version of the review has the date Oct. 29, 2017, and has the title “BOOKSHELF; Review: A Catalog of Generosity; His approach to philanthropy sought to promote practical efforts at self-improvement, not ambitious plans for social change.”)
The book under review is:
Diner, Hasia R. Julius Rosenwald: Repairing the World. New Haven, CT: Yale University Press, 2017.
When Swedish Furniture Makers Boycotted Ikea, Kamprad Found Furniture Makers in Poland
(p. A9) To encourage frugality in his workers, Mr. Kamprad was happy to offer himself as an example. He was known for reusing tea bags, flying economy class and taking public transport to airports. Even as a billionaire, he dickered over vegetable prices at farmers markets.
“Wasting resources is a mortal sin at IKEA,” he wrote in a guidebook for employees. “We do not need fancy cars, posh titles, tailor-made uniforms or other status symbols.”
He knew about global supply chains long before they were the norm. Rival retailers in the 1950s pressured Swedish furniture makers into boycotting the disruptive IKEA. So Mr. Kamprad visited Poland in the early 1960s and found primitive factories that, with training and tools from the Swedes, could make wooden furniture at much lower prices. (One problem: Some trees harvested in Poland still contained bullets from World War II.) Poland and China became two of the company’s main suppliers.
. . .
He assured his employees they had a noble mission: helping the masses afford comfortably furnished homes.
For the full obituary, see:
(Note: ellipsis added.)
(Note: the online version of the obituary has the date Feb. 2, 2018, and has the title “Ingvar Kamprad Made IKEA a Global Retailer by Keeping It Simple.”)
James Knott Exposed the EPA’s Doctoring of Water-Test Results They Used to Indict Him
(p. A9) James Knott helped build a better lobster trap.
Though the world didn’t beat a path to his door in Northbridge, Mass., Mr. Knott eventually persuaded most manufacturers of lobster traps to use his product—plastic-coated wire mesh—rather than wood to make their devices.
. . .
He built a business, Riverdale Mills Corp., that employs more than 150 people and has withstood price competition from China and a 1997 raid by pistol-packing agents of the Environmental Protection Agency. Then came an indictment alleging Mr. Knott violated the Clean Water Act by dumping acidic wastewater. He fought back, providing evidence that the EPA had doctored water-test results. The charges were dropped.
“What am I supposed to do—lay down and get stomped on?” he asked in a 2001 interview with the television news show “60 Minutes.”
. . .
When he was indicted by a federal grand jury in the water-pollution case in 1998, Mr. Knott faced a possible prison term of six years. He hired a retired FBI handwriting analyst, who found EPA test records had been altered to show an illegal degree of acidity in the wastewater. The government soon dropped its charges.
Mr. Knott fought a long and ultimately fruitless battle to require the government to reimburse him for his legal costs.
For the full obituary, see:
(Note: ellipses added.)
(Note: the online version of the obituary has the date July 27, 2018, and has the title “James Knott Pioneered Modern Lobster Traps and Fended Off the EPA.”)
Patenting a Better Vacuum Tube as Semiconductors Emerge
After his disappointing improved-vacuum-tube invention (see below), Kates did not give up. He went on to make important contributions in coordinating traffic lights to ease traffic flows.
(p. A9) When he demonstrated a computer tic-tac-toe game called Bertie the Brain in 1950, Josef Kates thought he was on the verge of making a fortune. The game, introduced at the Canadian National Exhibition, featured streamlined vacuum tubes invented by the Austrian-born Dr. Kates, who came to Canada in the 1940s as a refugee from Nazism. He hoped the tubes would revolutionize computing.
His timing was off. The rise of semiconductors was about to render vacuum tubes obsolete as computer components. “I got the patent, but the patent was useless,” he said in an oral history. “Okay, so on goes the world.”
For the full obituary, see:
(Note: the online version of the obituary has the date July 27, 2018, and has the title “Josef Kates Found Ways to Unsnarl Traffic and Solve Business Problems With Computers.”)