Category: Government

Nevada Government Lets Tesla Sell Directly to Consumers

(p. A13) . . . in addition to rubber-stamping the agreement that waived Tesla’s property, sales and business taxes for a decade or more–while throwing in discount power rates–the Nevada legislature also approved a bill last week that would exempt the auto maker from franchising regulations outlawing the company’s retail approach. The state’s auto dealers, who only weeks ago threatened to sue over the matter, shifted gears and endorsed the legislation.
“My car dealers want to assist in any way they can,” John Sande of the Nevada Franchise Auto Dealers Association told the Reno Gazette Journal. “Nevada law does not allow Tesla to come in and sell directly to the consumer, so we are going to have to come in and change it so they can sell directly to the consumer.”
No doubt the dealers balanced the pros and cons of agitating for their own self-interest against overwhelming political support for the deal and the spending potential of thousands of new, well-paid workers who may prefer a Ford or Chevy pickup over a $70,000 Tesla Model S. But the fact that Nevada legislators so quickly jettisoned a key provision of the state’s dealership-franchise provisions speaks volumes about how essential these statutes really are to the well-being of their constituents.
There is no rational reason Tesla–or any other automobile manufacturer–should be restricted from selling new cars directly to those who seek to buy them.

For the full commentary, see:
JOHN KERR. “OPINION; Tesla Breaks the Auto Dealer Cartel; Nevada lets the electric car maker sell directly to consumers. Too bad everyone else still can’t.” The Wall Street Journal (Weds., Sept. 17, 2014): A13.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date Sept. 16, 2014.)

Mexicans Abandon Government Subsidized Housing Developments

(p. A5) ZUMPANGO, Mexico — In an enormous housing development on the edge of this scrappy commuter town, Lorena Serrano’s 11-foot-wide shoe box of a home is flanked by abandoned houses. The neighborhood has two schools, a few bodegas and a small community center that offers zumba classes.
There is very little else.
“There are no jobs, no cinema, no cantina,” said Ms. Serrano of the 8,000-home development, called La Trinidad. Her husband’s commute to the capital, Mexico City, about 35 miles south, takes two hours each way by bus and consumes a quarter of his salary, she said. “We’re in the middle of nowhere.”
Ms. Serrano, 39, is among more than five million Mexicans who, over the past decade, bought houses through a government program that made mortgages available to low-income buyers.
The program, initially hailed by some experts as the answer to Mexico’s chronic housing deficit, fueled a frenzy of construction and helped inspire similar efforts in Latin America and beyond, including Brazil’s “My House, My Life,” which aims to build at least 3 million homes by this year.
But the concrete sprawl around Mexico City and other big towns grew faster than demand. Commutes proved unbearable, and residents abandoned their homes.

For the full story, see:
VICTORIA BURNETT. “ZUMPANGO JOURNAL; They Built It. People Came. Now They Go.” The New York Times (Tues., SEPT. 9, 2014): A5.
(Note: the online version of the story has the date SEPT. 8, 2014.)

Feds Allow Hollywood to Use Drones

(p. B1) LOS ANGELES — The commercial use of drones in American skies took a leap forward on Thursday [Sept. 25, 2014] with the help of Hollywood.
The Federal Aviation Administration, responding to applications from seven filmmaking companies and pressure from the Motion Picture Association of America, said six of those companies could use camera-equipped drones on certain movie and television sets. Until now, the F.A.A. has not permitted commercial drone use except for extremely limited circumstances in wilderness areas of Alaska.
Put bluntly, this is the first time that companies in the United States will be able to legally use drones to fly over people.
The decision has implications for a broad range of industries including agriculture, energy, real estate, the news media and online retailing. “While the approval for Hollywood is very limited in scope, it’s a message to everyone that this ball is rolling,” said Greg Cirillo, chairman of the aviation practice at Wiley Rein, a law firm in Washington.
Michael P. Huerta, the administrator of the F.A.A., said at least 40 similar applications were pending from companies beyond Hollywood. One is Amazon, which wants permission to move forward with a drone-delivery service. Google has acknowledged “self-flying vehicle” tests in the Australian outback.
“Today’s announcement is a significant milestone in broadening commercial use,” Anthony R. Foxx, secretary of transportation, told reporters in a conference call.

For the full story, see:
BROOKS BARNES. “Drone Exemptions for Hollywood Pave the Way for Widespread Use.” The New York Times (Fri., SEPT. 26, 2014): B1 & B7.
(Note: bracketed date added.)
(Note: the online version of the story has the date SEPT. 25, 2014.)

Feds Protect Us from Baby Photos

(p. 1) Pictures of smiling babies crowd a bulletin board in a doctor’s office in Midtown Manhattan, in a collage familiar to anyone who has given birth. But the women coming in to have babies of their own cannot see them. They have been moved to a private part of the office, replaced in the corridors with abstract art.
“I’ve had patients ask me, ‘Where’s your baby board?’ ” said Dr. Mark V. Sauer, the director of the office, which is affiliated with Columbia University Medical Center. “We just tell them the truth, which is that we no longer post them because of concerns over privacy.”
For generations, obstetricians and midwives across America have proudly posted photographs of the babies they have delivered on their office walls. But this pre-digital form of social media is gradually going the way of cigars in the waiting room, because of the federal patient privacy law known as Hipaa.
Under the law, the Health Insurance Portability and Accountability Act, baby photos are a type of protected health information, no less than a medical chart, birth date or Social Security number, according to the Department of Health and Human Services. Even if a parent sends in the photo, it is considered private unless the parent also sends written authorization for its posting, which almost no one does.

For the full story, see:
ANEMONA HARTOCOLLIS. “Baby Pictures at the Doctor’s? Cute, Sure, but Illegal.” The New York Times, First Section (Sun., AUG. 10, 2014): 1 & 19.
(Note: the online version of the story has the date AUG. 9, 2014.)

Cancer Will Likely Be Cured by “Lone Wolves, Awkward Individualists, Nonconformists”

Morton Meyers quotes Ernst Chain, who received the Nobel Prize in 1945, along with Fleming and Florey, for developing penicillin:

(p. 81) But do not let us fall victims of the naive illusion that problems like cancer, mental illness, degeneration or old age… can be solved by bulldozer organizational methods, such as were used in the Manhattan Project. In the latter, we had the geniuses whose basic discoveries made its development possible, the Curies, the Rutherfords, the Einsteins, the Niels Bohrs and many others; in the biologic field… these geniuses have not yet appeared…. No mass attack will replace them…. When they do appear, it is our job to recognize them and give them the opportunities to develop their talents, which is not an easy task, for they are bound to be lone wolves, awkward individualists, nonconformists, and they will not very well fit into any established organization.

Source:
Meyers, Morton A. Happy Accidents: Serendipity in Modern Medical Breakthroughs. New York: Arcade Publishing, 2007.
(Note: ellipses in original.)

Brazil Libertarian Uses Laser Vision to Privatize Trains

BrazilLaserVisionLibertarian2014-09-30.jpg“In campaign ads, Paulo Batista, who is running for a seat in the São Paulo state legislature, is a superhero looking for old commuter trains to blast into privatization with his laser vision.” Source of caption: print version of the NYT article quoted and cited below. Source of photo: online version of the NYT article quoted and cited below.

(p. A4) RIO DE JANEIRO — An auditor flies through the air like Superman, shooting laser beams from his eyes.
. . .
“The neutral, generic method of appealing to voters is a mediocre and failed way of doing politics,” said Paulo Batista, 34, a real estate auditor and self-described libertarian who is running for a seat in São Paulo’s state legislature.
Mr. Batista’s ads, depicting him as a superhero using his laser vision to privatize dilapidated commuter trains, are popular on YouTube.

For the full story, see:
SIMON ROMERO. “Brazil’s Politicians Often Play the Clown in Ads.” The New York Times (Weds., SEPT. 3, 2014): A4.
(Note: ellipsis added.)
(Note: the online version of the story has the date SEPT. 2, 2014.)

For Health Entrepreneurs “the Regulatory Burden in the U.S. Is So High”

(p. A11) Yo is a smartphone app. MelaFind is a medical device. Yo sends one meaningless message: “Yo!” MelaFind tells you: “biopsy this and don’t biopsy that.” MelaFind saves lives. Yo does not. Guess which firm found it easier to put their product in consumers hands?
. . .
In January 2010, Jeffrey Shuren, a veteran FDA official, was appointed director of the FDA’s Center for Devices and Radiological Health, the division responsible for evaluating MelaFind. Dr. Shuren, Dr. Gulfo writes, had “a reputation for being somewhat anti-industry” and “an aggressive agenda to completely revamp the device approval process.” Thus in March MELA Sciences was issued something called a “Not Approvable letter” raising various questions about MelaFind.
. . .
The letter sent the author into survival mode. He battled the FDA, calmed investors, and defended against the lawsuit all while trying to keep the company afloat. Under stress, Dr. Gulfo’s health began to decline: He lost 29 pounds, his hair began to fall out, and the pain in his gut became so intense he needed an endoscopy.
. . .
The climax to this medical thriller comes when, in “the greatest 15 minutes of [his] life,” Dr. Gulfo delivers an impassioned speech, à la “Twelve Angry Men,” to the FDA’s advisory committee. The committee voted for approval, 8 to 7, and, perhaps with the congressional hearing in mind, the FDA approved MelaFind in September 2011.
It was a major triumph for the company, but Dr. Gulfo was beat. He retired from the company in June 2013– . . .
. . .
Google’s Sergey Brin recently said that he didn’t want to be a health entrepreneur because “It’s just a painful business to be in . . . the regulatory burden in the U.S. is so high that I think it would dissuade a lot of entrepreneurs.” Mr. Brin won’t find anything in Dr. Gulfo’s book to persuade him otherwise. Until we get our regulatory system in order, expect a lot more Yo’s and not enough life-saving innovations.

For the full review, see:
ALEX TABARROK. “BOOKSHELF; It’s Broke. Fix It. MelaFind’s breakthrough optical technology promised earlier, more accurate detection of melanoma. Then the FDA got involved.” The Wall Street Journal (Tues., Aug. 12, 2014): A11.
(Note: ellipses added, except for the one internal to the final paragraph, which is in the original.)
(Note: the online version of the review has the date Aug. 11, 2014, and has the title “BOOKSHELF; Book Review: ‘Innovation Breakdown’ by Joseph V. Gulfo; MelaFind’s breakthrough optical technology promised earlier, more accurate detection of melanoma. Then the FDA got involved.”)

The book under review is:
Gulfo, Joseph V. Innovation Breakdown: How the FDA and Wall Street Cripple Medical Advances. Franklin, TN: Post Hill Press, 2014.

French Government Wastes $68.5 Million Ordering Trains Too Wide for Many Platforms

(p. B3) PARIS–France’s state-run railway system on Wednesday admitted failing to mind the gap, after realizing that a fleet of new trains it has ordered are too wide to fit many of the country’s stations.
Confirming a report in satirical weekly Le Canard Enchaîné, train operator Société Nationale des Chemins de Fer and network owner Réseau Ferré de France said about 1,300 of France’s 8,700 railway platforms must be trimmed to make way for the wider rolling stock.
It will cost about €50 million ($68.5 million) to alter the platforms to fit the new trains by 2016, when they are delivered, SNCF and RFF said.

For the full story, see:
WILLIAM HOROBIN. “French in Uproar Over Train Snafu.” The Wall Street Journal (Thurs., May 22, 2014): B3.
(Note: the online version of the story has the date May 21, 2014, and has the title “Mind the Gap: New French Trains Too Wide for Many Platforms.”)

Modelers Can Often Obtain the Desired Result

(p. A13) After earning a master’s degree in environmental engineering in 1982, I spent most of the next 10 years building large-scale environmental computer models. My first job was as a consultant to the Environmental Protection Agency. I was hired to build a model to assess the impact of its Construction Grants Program, a nationwide effort in the 1970s and 1980s to upgrade sewer-treatment plants.
The computer model was huge–it analyzed every river, sewer treatment plant and drinking-water intake (the places in rivers where municipalities draw their water) in the country. I’ll spare you the details, but the model showed huge gains from the program as water quality improved dramatically. By the late 1980s, however, any gains from upgrading sewer treatments would be offset by the additional pollution load coming from people who moved from on-site septic tanks to public sewers, which dump the waste into rivers. Basically the model said we had hit the point of diminishing returns.
When I presented the results to the EPA official in charge, he said that I should go back and “sharpen my pencil.” I did. I reviewed assumptions, tweaked coefficients and recalibrated data. But when I reran everything the numbers didn’t change much. At our next meeting he told me to run the numbers again.
After three iterations I finally blurted out, “What number are you looking for?” He didn’t miss a beat: He told me that he needed to show $2 billion of benefits to get the program renewed. I finally turned enough knobs to get the answer he wanted, and everyone was happy.
. . .
There are no exact values for the coefficients in models such as these. There are only ranges of potential values. By moving a bunch of these parameters to one side or the other you can usually get very different results, often (surprise) in line with your initial beliefs.

For the full commentary, see:
ROBERT J. CAPRARA. “OPINION; Confessions of a Computer Modeler; Any model, including those predicting climate doom, can be tweaked to yield a desired result. I should know.” The Wall Street Journal (Weds., July 9, 2014): A13.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date July 8, 2014.)

Feds Threaten 14,000 Dead Men with Prison, if They Fail to Register for Draft

(p. A3) . . . the Selective Service System mistakenly sent notices to more than 14,000 Pennsylvania men born between 1893 and 1897, ordering them to register for the nation’s military draft and warning that failure to do so is “punishable by a fine and imprisonment.”
. . .
Chuck Huey, 73, of Kingston, said he got a notice addressed to his late grandfather Bert Huey, a World War I veteran who was born in 1894 and died in 1995 at age 100.
. . .
Huey said he tried calling the Selective Service but couldn’t get a live person on the line.
. . .
“You just never know. You don’t want to mess around with the federal government,” he said.

For the full story, see:
The Associated Press. “14,000 men sent draft reminders 100 years too late.” Omaha World-Herald (Fri., July 11, 2014): 3A.
(Note: ellipses added.)

Structural Reforms Needed to Increase Innovation

(p. A13) . . . , a lack of “demand” is no longer the problem.
. . .
Where, instead, are the problems? John Taylor, Stanford’s Nick Bloom and Chicago Booth’s Steve Davis see the uncertainty induced by seat-of-the-pants policy at fault. Who wants to hire, lend or invest when the next stroke of the presidential pen or Justice Department witch hunt can undo all the hard work? Ed Prescott emphasizes large distorting taxes and intrusive regulations. The University of Chicago’s Casey Mulligan deconstructs the unintended disincentives of social programs. And so forth. These problems did not cause the recession. But they are worse now, and they can impede recovery and retard growth.
These views are a lot less sexy than a unicausal “demand,” fixable by simple, magic-bullet policies. They require us to do the hard work of fixing the things we all agree need fixing: our tax code, our cronyist regulatory state, our welter of anticompetitive and anti-innovative protections, education, immigration, social program disincentives, and so on. They require “structural reform,” not “stimulus,” in policy lingo.

For the commentary, see:
JOHN H. COCHRANE. “OPINION; The Failure of Macroeconomics; When models don’t yield the spending policies they want, some Keynesians abandon models–but not the spending.” The Wall Street Journal (Thur., July 3, 2014): A13.
(Note: ellipses added.)
(Note: the online version of the commentary has the date July 2, 2014.)