Category: Government

Subsidy of “Thriving” Chip Industry Is “Inexcusable”

(p. A16) Consider this recent summary, by the Cato Institute’s Scott Lincicome, of the healthy state of America’s semiconductor industry: “The United States is also a top-five global exporter of semiconductors and related equipment, shipping almost $47 billion of those goods in 2019. These and other data led the SIA [Semiconductor Industry of America] to conclude in its 2020 State of the U.S. Semiconductor Industry report that ‘the semiconductor manufacturing base in the United States remains on solid footing.’”

“The SIA also reports that the U.S. industry has ‘nearly half’ of all global semiconductor sales—a market share that has been steady (ranging from the mid‐40s to low 50s) since the late 1990s—and is the top seller in every major regional market, including China. Sales by U.S. semiconductor firms also grew from $76.7 billion in 1999 to $192.8 billion in 2019—a compound annual growth rate of almost 5%.”

“Beyond output and sales, the U.S. semiconductor industry has been a global leader in capital spending (capex) and R&D.”

Subsidies are always suspect, but when showered on industries that are thriving, they are beyond doubt inexcusable. What further proof do we need to conclude that politicians cannot be trusted to allocate resources wisely?

For Boudreaux’s full letter to the editor, see:

Boudreaux, Donald J. “LETTERS; U.S. Chip Industry Chipper, Subsidy a Waste.” The Wall Street Journal (Tuesday, June 1, 2021): A16.

(Note: the online version of the letter to the editor has the date May 31, 2021, and has the same title as the print version.)

Global Freedom Has Declined for 15 Straight Years

(p. A4) Freedom House, a nonpartisan organization dedicated to promoting freedom and democracy, reports that freedom across the globe has declined for 15 straight years, a trend that accelerated last year. “The long democratic recession is deepening,” Freedom House says.

. . .

Democracy is messy, but in an authoritarian system the problem is the lack of messiness. Cults of personality develop, opposing voices with potentially good ideas are squelched, healthy debates and innovative thoughts are blocked. In a new piece in Foreign Affairs magazine, China expert Jude Blanchette notes this risk for Mr. Xi in China: “Paeans to the greatness of ‘Xi Jinping Thought’ may strike outsiders as merely curious or even comical, but they have a genuinely deleterious effect on the quality of decision-making and information flows within the (Communist) party.”

At least China has done a good job of managing its economy. Elsewhere, authoritarian systems have produced a plundering of national resources, corruption and a general mismanagement of the economy.

For the full commentary, see:

Gerald F. Seib. “Autocrats Show Staying Power, for Now.” The Wall Street Journal (Tuesday, July 13, 2021): A4.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date July 12, 2021, and has the title “Cuba’s Unrest Frames World’s Big Struggle: Dictators vs. Democracies.”)

AI Algorithms Use Massive Data to Do “Narrow Tasks”

(p. B2) A funny thing happens among engineers and researchers who build artificial intelligence once they attain a deep level of expertise in their field. Some of them—especially those who understand what actual, biological intelligences are capable of—conclude that there’s nothing “intelligent” about AI at all.

. . .

. . . the muddle that the term AI creates fuels a tech-industry drive to claim that every system involving the least bit of machine learning qualifies as AI, and is therefore potentially revolutionary. Calling these piles of complicated math with narrow and limited utility “intelligent” also contributes to wild claims that our “AI” will soon reach human-level intelligence. These claims can spur big rounds of investment and mislead the public and policy makers who must decide how to prepare national economies for new innovations.

. . .

The tendency for CEOs and researchers alike to say that their system “understands” a given input—whether it’s gigabytes of text, images or audio—or that it can “think” about those inputs, or that it has any intention at all, are examples of what Drew McDermott, a computer scientist at Yale, once called “wishful mnemonics.” That he coined this phrase in 1976 makes it no less applicable to the present day.

“I think AI is somewhat of a misnomer,” says Daron Acemoglu, an economist at Massachusetts Institute of Technology whose research on AI’s economic impacts requires a precise definition of the term. What we now call AI doesn’t fulfill the early dreams of the field’s founders—either to create a system that can reason as a person does, or to create tools that can augment our abilities. “Instead, it uses massive amounts of data to turn very, very narrow tasks into prediction problems,” he says.

When AI researchers say that their algorithms are good at “narrow” tasks, what they mean is that, with enough data, it’s possible to “train” their algorithms to, say, identify a cat. But unlike a human toddler, these algorithms tend not to be very adaptable. For example, if they haven’t seen cats in unusual circumstances—say, swimming—they might not be able to identify them in that context. And training an algorithm to identify cats generally doesn’t also increase its ability to identify any other kind of animal or object. Identifying dogs means more or less starting from scratch.

For the full commentary, see:

Christopher Mims. “AI’s Big Chill.” The Wall Street Journal (Sat., July 31, 2021): B2.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 30, 2021, and has the title “Artificial Intelligence’s Big Chill.” When you click on the title in the search list internal to the WSJ, you get a different title on the page of the article itself: “Why Artificial Intelligence Isn’t Intelligent.”)

30% of U.S. Manufacturing Job Growth Is in Southwest

(p. A1) Companies producing everything from steel to electric cars are planning and building new plants in Southwest states, far from historical hubs of American industry in the Midwest and Southeast.  . . .

The Southwest, comprising Arizona, New Mexico, Texas and Oklahoma, increased its manufacturing output more than any other region in the U.S. in the four years through 2020, according to an analysis by The Wall Street Journal of data from the Bureau of Economic Analysis.

Those states plus Nevada added more than 100,000 manufacturing jobs from January 2017 to January 2020, representing 30% of U.S. job growth in that sector and at roughly triple the national growth rate, according to data from the Bureau of Labor Statistics.

. . .

(p. A8) Manufacturers in the Southwest have been relatively insulated from pandemic shutdowns and layoffs, and job growth there is expected to continue.

. . .

Some growth in the Southwest has come at the expense of California, classified in U.S. statistics as part of the Far West. In 2019, nearly 2,000 manufacturing workers in Texas and more than 1,300 in Arizona arrived from California, the most in a decade, the most recent Census Bureau data show. More than 2,700 manufacturing workers have come to Nevada from California in 2017 through 2019.

For the full story, see:

Ben Foldy and Austen Hufford. “Southwest Emerges As America’s New Factory Hub.” The Wall Street Journal (Weds., June 02, 2021): A1 & A8.

(Note: ellipses added.)

(Note: the online version of the story has the date June 1, 2021, and has the same title in search list, but on the article page has the title “The Southwest Is America’s New Factory Hub. ‘Cranes Everywhere.’”)

Toyota Bets Hybrids Are Still Short-Term Best Green Car Technology

(p. B3) TOKYO— Toyota Motor Corp. said most of its U.S. vehicles would still run on gasoline a decade from now because it doesn’t think fully electric vehicles will have caught up in cost and convenience.

Toyota doubled down on its commitment to a technology it pioneered, hybrid vehicles, which are fueled with gasoline but also have an electric motor that raises fuel efficiency. The company projected that in 2030, slightly more than half of the vehicles it sells in North America would be hybrids, while around 30% would run on traditional gasoline engines and the remainder would be fully electric.

“If you take a snapshot of 2030, the price of battery EVs and the provision of infrastructure around the globe probably won’t have advanced all that much,” said Toyota executive Jun Nagata at a news conference Wednesday. “Hybrids and plug-in hybrids will be easier for customers to buy.”

. . .

“The goal is not electric vehicles, the goal is carbon neutrality, and even if we have the best technology, if it’s not chosen by customers, it will not have the impact of reducing emissions,” Mr. Kuffner said at Wednesday’s news conference.

For the full story, see:

Peter Landers. “Toyota Doubles Down on Hybrid Technology.” The Wall Street Journal (Thurs., May 13, 2021): B3.

(Note: ellipsis added.)

(Note: the online version of the story has the date May 12, 2021, and has the title “Most Toyotas Will Still Use Gasoline in 2030, Company Says.”)

Jon Stewart’s Solyndra Riff Skewered Industrial Policy

Remember Solyndra? Apparently too few do. Today’s WSJ reports how the U.S. is imitating China’s “industrial policy” of subsidizing favored firms in favored industries such as green energy and semiconductors. To remind us that Larry Summers was right when he wrote that “government is a crappy venture capitalist,” I link above to Jon Stewart’s wise and funny send-up of the Solyndra debacle, first broadcast almost 10 years ago, on September 15, 2011.

The WSJ article mentioned above, is:

Ip, Greg. “West Dusts Off an Old Idea to Compete with China.” The Wall Street Journal (Fri., July 30, 2021): A1 & A7.

Omaha’s “Boutique” Quarantine Unit Looked Backward to Ebola, Not Forward to Covid-19

(p. C1) Quarantine can be lifesaving; it can also be dangerous, an exercise of extraordinary power in the name of disease control, a presumption of guilt instead of innocence.

In “Until Proven Safe,” a new book about quarantine’s past and future, Geoff Manaugh and Nicola Twilley do an impressively judicious job of explaining exactly why fears of quarantine are understandable and historically justified, . . .

. . .

(p. C6) What becomes clear in “Until Proven Safe” is that it’s a lot easier to tell someone else to just shut up and submit to quarantine than to do it yourself. Any exercise of such formidable power also opens up the possibility of abuse. The book includes historical examples of disease control measures getting mapped onto existing prejudices. In 1900, a cordon sanitaire in San Francisco’s Chinatown zigzagged around white-owned businesses; . . .

. . .

Quarantine infrastructures tend to be tailored to the previous epidemic, instead of anticipating whatever is to come. A shiny new federal quarantine facility in Omaha — the first constructed in the United States in more than a century — was finished in January 2020, just in time to receive 15 American passengers from the coronavirus-infested Diamond Princess cruise ship. This National Quarantine Unit has a grand total of 20 beds. It offers a “boutique experience” ideally suited to managing one or two patients at a time after they have had potential exposure to, say, Ebola. The facility can’t do much to help contain a raging pandemic. As Manaugh and Twilley point out, the first American evacuation flight out of Wuhan alone carried 195 passengers.

For the full review, see:

Jennifer Szalai. “BOOKS OF THE TIMES; You Can’t Leave Unless We Say So.” The New York Times (Tuesday, July 27, 2021): C1 & C6.

(Note: ellipses added.)

(Note: the online version of the review has the date July 26, 2021, and has the title “BOOKS OF THE TIMES; The Extraordinary History (and Likely Busy Future) of Quarantine.”)

The book under review is:

Twilley, Nicola, and Geoff Manaugh. Until Proven Safe: The History and Future of Quarantine. New York: Farrar, Strauss and Giroux, 2021.

Lack of Full FDA Vaccine Approval Discourages Use

(p. A12) Even as President Biden, the C.D.C. and virtually the entire scientific community are urging — pleading with, even — Americans to get vaccinated, the government has not formally approved any vaccine. The Food and Drug Administration has instead given only “emergency use authorization” to the shots from Moderna, Pfizer and Johnson & Johnson. That’s a temporary form of approval that allows people to receive shots while the agency continues to study their effectiveness and safety.

The difference between emergency authorization and full approval matters.

. . .

The situation also feeds uncertainty and skepticism among some Americans who have not yet gotten a shot. Those skeptics, as Matthew Yglesias of Substack wrote yesterday, are effectively taking the F.D.A. at its word. The F.D.A. leaders’ official position is that “they don’t have enough safety data yet,” Yglesias noted.

. . .

. . ., public health officials made highly technical statements about masks that many people interpreted as discouragement from wearing them. These statements ignored the many reasons to believe that masks could make a difference (like their longtime popularity in Asia to prevent the spread of viruses) and focused instead on the absence of studies showing that masks specifically prevented the spread of Covid.

Later, officials insisted that they were merely “following the data.” In truth, though, they were basing their advice on a narrow reading of the data — . . . .

. . .

Think of it this way: In the highly unlikely event that the evidence were to change radically — if, say, the vaccines began causing serious side effects about 18 months after people had received a shot — Americans would not react by feeling confident in the F.D.A. and grateful for its caution. They would be outraged that Woodcock and other top officials had urged people to get vaccinated.

The combination means that the F.D.A.’s lack of formal approval has few benefits and large costs: The agency has neither protected its reputation for extreme caution nor maximized the number of Americans who have been protected from Covid. “In my mind, it’s the No. 1 issue in American public health,” Topol told me. “If we got F.D.A. approval, we could get another 20 million vaccinated,” he estimated.

For the full commentary, see:

David Leonhardt. “Why, After Months of Shots, Are None Approved?.” The New York Times (Thursday, July 22, 2021): A12.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 21, 2021, and has the title “Why Aren’t the Vaccines Approved?”)

Biden’s “Infrastructure” Central Planners Aim to Tear Up Earlier Central Planners’ Highways

(p. A10) As midcentury highways reach the end of their life spans, cities across the country are having to choose whether to rebuild or reconsider them. And a growing number, like Rochester, are choosing to take them down.

. . .

Nearly 30 cities nationwide are currently discussing some form of removal.

. . .

The growing movement has been energized by support from the Biden administration, which has made addressing racial justice and climate change, major themes in the debate over highway removal, central to its agenda.

. . .

Congress is still haggling over Mr. Biden’s infrastructure plan, but experts say the proposed funding for highway removal represents a shift in the way the government approaches transportation projects.

“As recently as a decade ago,” said Peter D. Norton, a transportation historian at the University of Virginia, “every transportation problem was a problem to be solved with new roads.” Now, the impacts of those roads are beginning to enter the equation.

For the full story, see:

Nadja Popovich, and Denise Lu. “Can Removing Highways Fix America’s Cities?” The New York Times (Saturday, May 29, 2021): A10-A11.

(Note: ellipses added.)

(Note: the online version of the story has the date May 27, 2021, and has the same title as the print version. The online version, but not the print version, lists Josh Williams as the second co-author.)