TransCanada Plans to Use Eminent Domain to Build the Keystone Pipeline

I am not opposed to the Keystone Pipeline on environmental grounds. But I have long believed that property rights should be defended, and that we too readily allow the violation of property rights through eminent domain.
If the Keystone Pipeline can be built without eminent domain, then I am in favor of allowing it. If it can only be built by violating landowners’ property rights, then I oppose it.

(p. 1A) LINCOLN — As the Republican leader in the U.S. Senate pledged quick approval of the Keystone XL pipeline early next year, final offers were landing Tuesday in dozens of Nebraska mailboxes.

TransCanada Corp. said it mailed new offers of right-of-way payments this week to more than 100 Nebraska landowners who have refused to sign an easement contract.
The letters also say the company will pursue eminent domain against landowners who don’t agree to terms by Jan. 16. The company says Nebraska law requires condemnation proceedings to start within two years of the state’s approval of the pipeline route, which occurred Jan. 22, 2013.

For the full story, see:
Joe Duggan. “TransCanada sends final offers to 100-plus Nebraska landowners.” Omaha World-Herald (Weds., DECEMBER 17, 2014): 1A & 3A.
(Note: the online version of the story has the title “Keystone XL pipeline: TransCanada sends final offers to 100-plus Nebraska landowners.”)

HR Regulations and Fear of Lawsuits Keep Managers from Firing Workers Who Do Not Work

(p. 1B) The biggest problem in your workplace has a name. His name is Jeff. . . .
Jeff sits two cubicles down from us, or three, or four. His real name may be John, Juan or Joan. He gets to the widget factory late, he leaves early and always mucks up his part of any group project. He complains, loudly, about the smallest things, and when you bring doughnuts for your birthday he probably takes three and then talks with his mouth full, too.
. . .
(p. 2B) . . . , morale suffers greatly when most of a company’s employees perceive that their supervisor is failing to deal with their low-performing co-worker, month after month, year after year.
For this, Hoogeveen blames a corporate culture that is so concerned about HR regulations, and the often-imagined threat of litigation, that bosses often fail to take into account how the trouble employee affects the larger climate.
. . .
. . . if Jeff doesn’t improve, he needs to be fired. This is perhaps the worst part of a boss’s job, Hoogeveen thinks. His eyes mist as he recalls firing an employee whom he liked, but who was simply a bad fit at QLI.
It’s human nature to avoid this conflict, to maintain the status quo and let Jeff be, he says. That’s what can and does happen at most Omaha companies.
But it’s bad for the employees, and it’s bad for business.
“A lot of this stuff is incredibly easy to understand,” says Omaha’s workplace mechanic [Kim Hoogeveen]. “It’s incredibly difficult to live.”

For the full story, see:
Hansen, Matthew. “Workplace Guru: Don’t Let Problem Worker Slide.” Omaha World-Herald (Mon., July 21, 2014): 1B-2B.
(Note: ellipses, and bracketed name, added.)
(Note: the online version of the article had the title “Hansen: Don’t let Jeff — the problem worker — slide, workplace guru says.”)

Warren Buffett Lately Low on Alpha

(p. 3) Warren Buffett is probably the most famous investor of his generation, and for good reason: His track record over the long term is a thing of beauty.
He has beaten the market by a wide margin over 49 years, a record so impressive that it’s used in finance classes as a textbook example of “alpha.”
Alpha is an elusive quality. Very simply put, it is the ability to beat an index fund without adding risk to a portfolio. Investment managers are always seeking it. If it exists, Warren Buffett surely has had it.
A new statistical analysis of Mr. Buffett’s long-term record at Berkshire Hathaway has just been done, and it’s come up with some fascinating insights about his abilities, past and present, and about the chances that the rest of us have for beating the market. Using a series of statistical measures, the study suggests that Mr. Buffett has indeed been blessed with an impressively big dose of alpha over a very long career.
But it also reveals something that isn’t impressive at all: For four of the last five years, Mr. Buffett has been doing worse than the typical, no-frills Standard & Poor’s 500-stock index fund — so much worse that it’s unlikely to be a matter of a string of bad luck. Mr. Buffett has begun to behave like an investor with no alpha at all.
. . .
A vast majority of individuals, including most people now working in finance, do not have alpha, Mr. Mehta says. It doesn’t matter whether they have studied finance or have prodigious math skills; the statistics show that they are unlikely to have the ability to beat the market.
That has a serious implication for individual investors, he says: True investing skill is so rare that the rest of us shouldn’t even try to emulate those who have it. In addition, he says, we probably shouldn’t bother trying to hire the few outperformers to invest our money. Why? Because we aren’t likely to be able to identify them.

For the full commentary, see:
JEFF SOMMER. “Strategies; The Oracle of Omaha, Lately Looking a Bit Ordinary.” The New York Times, SundayBusiness Section (Sun., APRIL 6, 2014): 3.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date APRIL 5, 2014.)

Government Pushed Kiewit to Ignore Worker Safety

TrappedUnderTheSeaBK2014-04-25.jpg

Source of book image: http://d202m5krfqbpi5.cloudfront.net/books/1369819962l/17934699.jpg

(p. C9) Boston Harbor’s filth is legendary. It was mock-celebrated in the 1966 song “Dirty Water.” The city’s water-treatment plants were hopelessly inadequate, and barely treated sewage had been pouring into the harbor for decades.
. . .
The Deer Island Sewage Treatment Plant was supposed to solve these problems. Begun in 1990, the $3.8 billion facility would process human and industrial waste on a small island in Boston Harbor and then send it through a 9.5-mile tunnel into the deep waters of the Atlantic. Fifty-five vertical pipes called risers spurred off the tunnel’s final section to further diffuse waste before releasing it into the sea. Temporary safety plugs, likened to giant salad bowls, had been placed near the bottom of each riser to keep water from seeping in before construction was complete.
These plugs were a source of conflict between the tunnel’s owner, the Massachusetts Water Resources Authority (MWRA), and the company they hired to build it, Kiewit, “the Omaha-based construction giant” that, Mr. Swidey notes, “had built more miles of the U.S. highway system than any other contractor.” The director of MWRA, Doug MacDonald, had left a job as a partner in a Boston law firm to take over the authority, a behemoth of 1,700 employees and, at the peak of harbor cleanup, an additional 3,000 construction workers. Mr. MacDonald’s job included mollifying various parties who disagreed about how the Deer Island project would reach completion: Kiewit; the tunnel’s designers, mostly out of the picture by 1998; ICF Kaiser Engineers, hired by MWRA to protect its interests and act as Mr. MacDonald’s eyes and ears; the union “sandhogs” who bored out 2.4 million tons of rock to create the tunnel; the Occupational Safety and Health Administration, ostensibly looking out for worker safety but seeming more interested in handing out fines; and, though federal funds for harbor cleanup had long since dried up, “a bow-tied federal judge who served as the cleanup project’s robed referee, threatening stiff fines or worse if the deadlines he imposed were not met.”
. . .
The problem weighed most heavily on Kiewit. The firm was contractually obligated to deliver on time, subject to late-fee penalties of $30,000 a day, and to cover cost overruns. More, Kiewit had fronted the construction costs and would only be paid by selling the tunnel, piece by piece, to MWRA. The contract further obligated Kiewit to provide “lighting and ventilation (or breathing apparatus) for the personnel” that pulled the plugs but, in what seemed a senseless conflict, mandated that the plugs “could be removed only after the tunnel was completed,” writes Mr. Swidey, “meaning after the sandhogs had cleared out, taking their extensive ventilation, transportation, and electrical systems with them.”
Kiewit protested that clearing the tunnel of its life-sustaining infrastructure would make “the risk of catastrophe [to the workers pulling the plugs] . . . exponentially higher !” They offered several sound alternatives. In response, ICF Kaiser accused them of just wanting their payday. After a “year-long memo war,” Kiewit capitulated, cleared the tunnel and hired a commercial dive team to go into a pitch-black airless tube.

For the full review, see:
NANCY ROMMELMANN. “BOOKS; One Mile Down, Ten Miles Out; Their oxygen was starting to get thin. On the verge of passing out, Hoss radioed back to the Humvees. The reply was an expletive, and the line went dead.” The Wall Street Journal (Sat.,March 15, 2014): C9.
(Note: ellipses between paragraphs, added; ellipsis inside last paragraph, in original.)
(Note: the online version of the review has the date March 14, 2014, and has the title “BOOKSHELF; Book Review: ‘Trapped Under the Sea’ by Neil Swidey; In 1999, five deep-sea welders had to traverse a tunnel beneath Boston Harbor with no breathable air, no light and no chance for rescue should things go horribly wrong.” )

The book under review is:
Swidey, Neil. Trapped under the Sea: One Engineering Marvel, Five Men, and a Disaster Ten Miles into the Darkness. New York: Crown Publishers, 2014.

Free Agent Entrepreneur Mr. C Exuded a Zest for Life

CanigliaYanoMisterC2013-11-27.jpg “In a 2000 photo, Sebastiano “Yano” Caniglia, a member of one of Omaha’s largest restaurant families, stands outside his Mister C’s Steakhouse, which operated from 1953 until 2007.” Source of caption and photo: online version of the Omaha World-Herald obituary quoted and cited below.

In the current draft of my book Openness to Creative Destruction, I use Mr. C as my example of a “free agent entrepreneur.” An evening at Mr. C’s was as much about spirit and experience and entertainment as it was about food. Mr. C’s was on the other side of town, but we tried to get there at least once a year, usually around the holidays. When my daughter was young, she would run over to the wonderful diorama that included Frank Sinatra, Mr. C, and the Pope. I remember the strolling violinist, the accordion player and the clown. And the time Mr. C stopped by our table to show us his singing potted flower. This time of year, I remember the thousands of small twinkling Christmas lights throughout the restaurant. Mr. C exuded a wonderful childlike enthusiasm and zest for life.

(p. 1B) “He was only at Hospice House for a few hours,” said his son. “He was singing to the nurses, telling them stories and ¬≠having a wonderful day when he dropped.”
. . .
(p. 2B) David Caniglia said his father had a simple business model that included “good, old-fashioned hard work.”
“He was sincere when people came into the restaurant. They were more than just customers, they were coming into his home,” he said.
On the last day for Mister C’s, Yano Caniglia told The World-Herald: “I couldn’t wait to get to work every day. I never wanted it to end.”
A reporter in 1983 described Mr. C in his restaurant:
“If it was your first visit, you probably were still recovering from the dazzle of thousands of Christmas lights that festoon the place when he bustled up to your table, welcomed you in his booming voice and, if there were kids in your party, deftly twisted balloon animals for them.”

For the full obituary, see:
Sue Story Truax. “Man Behind Mister C’s Success, Sebastiano Caniglia, Dies at 89.” Omaha World-Herald (Friday, November 15, 2013): 1B-2B.
(Note: ellipsis added.)
(Note: the online version of the obituary has the date Thursday, November 14, 2013, and has the title “Yano Caniglia was the mister in Mr. C’s Steakhouse.”)

Buffett’s Berkshire Buys More of Dubious DaVita

A case has been made on CNN that DaVita has committed Medicare fraud costing taxpayers many millions of dollars. DaVita has been discussed in previous blog entries on November 30, 2012, May 18, 2013, and June 11, 2013.

(p. 3D) Omaha investor Warren Buffett’s company bought nearly 3.7 million more shares of DaVita Inc. after the dialysis provider reported its earnings . . . [in the first week of November 2013].

Berkshire Hathaway Inc. said in documents filed with the Securities and Exchange Commission on Friday that it owns 35.1 million shares of DaVita.

For the full story, see:
THE ASSOCIATED PRESS. “Berkshire buys 3.7 million more shares of DaVita after report.” Omaha World-Herald (Mon., November 11, 2013): 3D.
(Note: ellipsis and bracketed words added.)

Nebraska Teenager Becomes the “George Clooney of YouTube”

(p. 263) Google also became more aggressive in connecting sponsors for popular videos. A paragon of YouTube’s business model was “Fred,” a video channel created by a Columbus, Nebraska, teenager named Lucas Cruikshank. The teen pretended to be a six-year-old kid named Fred Figglehorn in a series of two-minute videos. “Fred is the George Clooney of YouTube,” says Hunter Walk. “He was the first one with a million subscribers. He uploads videos, and we put ads against them. Sometimes he sells product placement ads. Fred makes a million dollars a year. He just signed a movie deal.” The Fred videos– generally manic rants in which Cruikshank portrays a hyperactive, possibly brain-damaged child who speaks like one of Ross Bagdasarian’s chipmunks– often sported commercial messages for sponsors such as Samsung, the Food Channel, and Bratz on an overlay at the bottom of the window. Since he started in 2008, at age fourteen, Fred’s (p. 264) YouTube videos have chalked up over half a billion viewings. Though Fred’s success was solely a product of YouTube, people in the company never met the phenom. “We sent him a cake once,” says Walk.
YouTube helped Fred’s youthful creator not just by selling ads but by providing analytics, the same way it did for AdSense publishers. (This was a result of an initiative called the YouTube Insight project, developed by engineers in Google’s Zurich center.) Such data helped creators learn what was working and where. “They’re like, ‘Oh my God, I’m big in the U.K.! I never knew I had a London following!'” says Walk. Superusers such as Cruikshank were so successful in exploiting YouTube’s business initiatives that corporations such as Sony were studying their methodology and even paid some of them consultant fees to help them understand the digital world.

Source:
Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.