Category: Regulations

Gerardo Guillén García del Barco Wants to Build in Cuba “Without Being Hindered by Bureaucracy”

(p. A10) HAVANA — Car dealerships, book publishing and hedge funds are still prohibited. Bed-and-breakfasts are not. Zoos, scuba diving centers and weapons production remain banned. Veterinary services aren’t.

As Cuba’s Communist government continues its piecemeal expansion of the fledgling private sector, Cubans are carefully parsing a list of the economic activities that the government proposes to keep under its control.

. . .

The new list seems to open major new space for manufacturing. Cubans will now be able to apply for licenses to open cheese, paint and toy factories, for example, though the government has not yet defined the permitted size of such ventures.

While some Cubans hailed the list as an important step forward in the country’s economic liberalization, it left others complaining that the government had not gone far enough.

“It’s messed up,” said Gerardo Guillén García del Barco, 26, an architect in Havana whose profession the government plans to maintain under its sole control. “Every time something appears that looks like a panacea, it ends in nothing.”

“My dream is to do exactly what I’m doing today but within a legal framework,” he said, explaining that he left a government firm and now works freelance without a license. “I want to do my own architecture without being hindered by bureaucracy.”

. . .

Last Saturday [Feb. 6, 2021], in announcing the planned expansion of private economic activity, Marta Elena Feitó, Cuba’s labor and social security minister, said that the changes would “unleash the productive forces” of the population.

For the full story, see:

Ed Augustin and Kirk Semple. “Cubans Study a Shrinking List of Prohibited Private Enterprises.” The New York Times (Friday, February 12, 2021): A10.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date Feb. 11, 2021, and has the title “Cubans Study a Shrinking List of Banned Private Enterprises.”)

Diamond’s Innovation Unbound Lecture Posted to YouTube

Dr. Derek Yonai of the Koch Center for Leadership and Ethics posted on Tues., March 9, 2021 my half-hour lecture on how regulations bind innovators. The lecture is related to my book:

Diamond, Arthur M., Jr. Openness to Creative Destruction: Sustaining Innovative Dynamism. New York: Oxford University Press, 2019.

$15 Minimum Wage Is “a Potentially Catastrophic Policy Error”

(p. A2) Opponents of a large increase say policy makers should be especially concerned with job losses in low-wage industries, such as the leisure and hospitality sector, which shed 3.8 million jobs last year.

More than 37% of workers who earned the federal minimum wage in 2019 were employed in restaurants, hotels and other parts of the hospitality sector, according to the Labor Department. Retail workers accounted for nearly 23% of minimum-wage earners, and education and health employees, including home health aides, represented 14%.

“It’s a potentially catastrophic policy error,” Kevin Hassett, former President Donald Trump’s top economic adviser, said of the $15 minimum wage. The pandemic, he said, pushed many small businesses to the brink of bankruptcy, but those restaurants and other firms are holding on, expecting profits later this year when the economy can open up. A minimum-wage increase would cut into those expected profits and cause businesses to close, he said. “It’s going to cost a lot of people their jobs.”

Mr. Hassett said low-wage workers have been disproportionately harmed by the pandemic, and that the government should support them through direct payments rather than mandating that private firms raise wages.

The nonpartisan Congressional Budget Office found in a 2019 study that raising the federal minimum wage to $15 an hour by 2025 could cost 1.3 million Americans their jobs. The same study found the higher level could boost the pay of about 27 million workers and lift 1.3 million Americans out of poverty.

For the full story, see:

Eric Morath. “Minimum-Wage Push Re-Ups Debate.” The Wall Street Journal (Thursday, February 4, 2021): A2.

(Note: the online version of the story was updated February 3, 2021, and has the title “Biden Wants a $15 Minimum Wage. Here’s What People Say It Would Do to the Economy.” The penultimate sentence quoted above, appears in the online, but in the print, version.)

The nonpartisan Congressional Budget Office study mentioned above is:

Congressional Budget Office. “The Effects on Employment and Family Income of Increasing the Federal Minimum Wage.” July 2019.

When Incumbents Can’t Compete, They Seek to Regulate and Litigate Startups

(p. B5) Figs Inc. has fashioned itself as the Warby Parker of medical uniforms, using advertising splashed on subways and billboards to sell its form-fitting scrubs directly to nurses and doctors.

. . .

Careismatic Brands, a leader in medical apparel with brands of scrubs like Cherokee and Dickies, has pursued litigation against Figs since 2019, saying the smaller company has misled health-care workers with boasts about how its products help keep them safe.

. . .

Startups increasingly have to prepare for legal challenges from the industry they are trying to disrupt, said Arun Sundararajan, a business professor at New York University. Starting with the rise of Uber and Airbnb, “The incumbents chose regulation and litigation to try to push them back,” he said, a strategy that has been replicated.

For the full story, see:

Sara Randazzo. “Figs, a Maker of Scrubs, Fights Lawsuit Over Ads, Marketing.” The Wall Street Journal (Thursday, February 4, 2021): B5.

(Note: ellipses added.)

(Note: the online version of the story has the date February 3, 2021, and has the title “Figs Fights Lawsuit Over Scrubs Ads.”)

Musk Says Under F.A.A. Rules “Humanity Will Never Get to Mars”

(p. B5) Last week, SpaceX and government regulators seemed to be in a strange standoff. SpaceX had filled the propellant tanks of this prototype of Starship — its ninth one — and looked ready to launch. But then the rocket stayed on the ground when no approval from the F.A.A. arrived.

Mr. Musk expressed frustration on Twitter, describing the part of the F.A.A. that oversees SpaceX as “fundamentally broken.”

Mr. Musk wrote, “Their rules are meant for a handful of expendable launches per year from a few government facilities. Under those rules, humanity will never get to Mars.”

Late on Monday [Feb. 1, 2021], the F.A.A. gave permission for Tuesday’s launch, but then revealed that the December launch had occurred without the agency’s approval. SpaceX had requested a waiver to conduct that flight even though it had not shown that a pressure wave that could be generated by an explosion during the test would not pose a danger to the public. The F.A.A. denied the request. SpaceX defied the ruling and launched anyway.

Even if Starship had landed perfectly, launching it without approval was a violation of the company’s license.

For the full story, see:

Chang, Kenneth. “SpaceX’s Starship Mars Rocket Prototype Again Crashes After a Test Launch.” The New York Times (Weds., Feb. 3, 2021): B5.

(Note: bracketed date added.)

(Note: the online version of the story has the date Feb. 2, 2021, and has the title “SpaceX’s Prototype Mars Rocket Crashes in Test Flight.”)

Nonpartisan CBO Estimates $15 Minimum Wage Would Cause 1.4 Million Job Loss

(p. B5) WASHINGTON — Raising the federal minimum wage to $15 an hour — a proposal included in the package of relief measures being pushed by President Biden — would add $54 billion to the budget deficit over the next decade, the Congressional Budget Office concluded on Monday [Feb. 8, 2021].

. . .

Critics of the plan noted a different element of the report: its forecast that raising the minimum wage to $15 would eliminate 1.4 million jobs by the time the increase takes full effect.

“Conservatives have been saying for a while that a recession is absolutely the wrong time to increase the minimum wage, even if it’s slowly phased in,” said Brian Riedl, a senior fellow at the Manhattan Institute. “The economy’s just too fragile.”

For the full story, see:

Jason DeParle. “$15 Minimum Wage Would Cut Poverty And 1.4 Million Jobs.” The New York Times (Tuesday, February 9, 2021): B5.

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

(Note: the online version of the story has the date Feb. 8, 2021, and has the title “Minimum Wage Hike Would Help Poverty but Cost Jobs, Budget Office Says.”)

The nonpartisan Congressional Budget Office report mentioned above is:

Congressional Budget Office. “The Budgetary Effects of the Raise the Wage Act of 2021.” Feb. 2021.

FDA Should Approve Faster Clinical Trials for Boosters to Block New Covid-19 Variants

(p. A17) . . . , it is essential to design clinical trials that can be completed within several months, to avert potential outbreaks of new variants. It’s fast, but given today’s scientific capabilities that could be enough time to do the required trials.

Take the South African variant known as B1351. The existing trials will be used to establish that the current vaccines provide clinical protection against Covid disease. But to prove the new versions targeting B1351 work as well as the current vaccines, the FDA can measure the antibody levels in the plasma from patients who have recovered from B1351 and establish a benchmark for the number of antibodies needed to neutralize that virus. Then the FDA can use those antibody levels as a proxy to evaluate whether updated vaccines are able to generate sufficient levels of protection.

This could allow vaccine makers to test new boosters in clinical trials that enroll 300 or 400 patients rather than 40,000, an enormous savings in cost and time. Larger and longer studies can be started at the same time, including ones that follow vaccinated patients.

For the full commentary, see:

Scott Gottlieb. “Another Promising Vaccine, This One From Johnson & Johnson.” The Wall Street Journal (Monday, February 1, 2021): A17.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date January 31, 2021, and has the same title as the online version.)

Early Animation “Followed Only One Rule”: “Anything Goes”

(p. C5) The story of Disney Studios is a central strand in Mitenbuler’s narrative; Disney became the formidable force that the other animation studios would look toward, compete with and rail against. Max Fleischer, whose studio was responsible for the likes of Popeye and Betty Boop, groused that Disney’s “Snow White,” released in 1937, was “too arty.”  . . .  The wife of one of the Fleischer brothers, though, said they had better watch out: “Disney is doing art, and you guys are still slapping characters on the butt with sticks!”

But what if those slapped butts were part of what had made animation so revolutionary in the first place? Mitenbuler suggests as much, beginning “Wild Minds” with the early days of animation, in the first decades of the 20th century, when the technology of moving pictures was still in its infancy. Like the movie business in general, the field of animation contained few barriers to entry, and a number of Jewish immigrants shut out from other careers found they could make a decent living working for a studio or opening up their own. Even Disney, who grew up in the Midwest, was an outsider without any connections.

The work created in those early decades was often gleefully contemptuous of anything that aspired to good taste. Until the movie studios started self-censoring in the early ’30s, in a bid to avoid government regulation, animators typically followed only one rule to the letter: Anything goes.

For the full review, see:

Jennifer Szalai. “BOOKS OF THE TIMES: Ehh, What’s Animation, Doc?” The New York Times (Thursday, December 17, 2020): C5.

(Note: ellipsis added.)

(Note: the online version of the review has the date Dec. 16, 2020, and has the title “BOOKS OF THE TIMES: ‘Fantasia,’ ‘Snow White,’ Betty Boop, Popeye and the First Golden Age of Animation.”)

The book under review is:

Mitenbuler, Reid. Wild Minds: The Artists and Rivalries That Inspired the Golden Age of Animation. New York: Atlantic Monthly Press, 2020.

Fauci Lied on Herd Immunity Until His “Gut Feeling” Told Him U.S. Was Ready for the Truth

(p. A6) In the pandemic’s early days, Dr. Fauci tended to cite the same 60 to 70 percent estimate that most experts did. About a month ago, he began saying “70, 75 percent” in television interviews. And last week, in an interview with CNBC News, he said “75, 80, 85 percent” and “75 to 80-plus percent.”

In a telephone interview the next day, Dr. Fauci acknowledged that he had slowly but deliberately been moving the goal posts. He is doing so, he said, partly based on new science, and partly on his gut feeling that the country is finally ready to hear what he really thinks.

For the full story, see:

Donald G. McNeil Jr. “How Can We Achieve Herd Immunity? Experts Are Quietly Upping the Number.” The New York Times, First Section (Sunday, December 27, 2020): A6.

(Note: the online version of the story has the date Dec. 24, 2020, and has the title “How Much Herd Immunity Is Enough?”)

Andrew Cuomo Explains Slow New York Rollout of Vaccines: “It’s Bureaucracy”

(p. A1) ALBANY, N.Y. — New York, the onetime center of the pandemic, faced a growing crisis on Monday [Jan. 4, 2021] over the lagging pace of coronavirus vaccinations, as deaths continue to rise in the second wave and Gov. Andrew M. Cuomo came under mounting pressure to overhaul the process.

. . .

(p. A5) The state has had a deliberate approach in distributing the vaccine; until Monday, the vaccinations were almost exclusively given to health care workers, group home residents, and those living and working at nursing homes.

That cautious approach was also evident in the state’s initial guidance to determine which health care employees should be prioritized for vaccines; the state had advised clinics and other facilities to rank employees through a matrix that takes into account age, comorbidities, occupation and the section of the facility where the person works.

. . .

Mr. Cuomo rejected any notion that his administration was at fault for not distributing more vaccines, asserting that the problem was a local issue, and urging Mr. de Blasio and other leaders who oversee public hospital systems to take “personal responsibility” for their performance.

“They have to move the vaccine,” the governor said in Albany. “And they have to move the vaccine faster.”

. . .

“There is no one cause,” he said, noting that he had spoken to dozens of hospitals about the issue.

He did suggest, however, that management was at fault in some cases, saying that there was a lack of “urgency” in certain hospital systems.

“It’s bureaucracy,” he said.

For the full story, see:

Jesse McKinley, Luis Ferré-Sadurní and Emma G. Fitzsimmons. “New York Lags In Vaccinations While Toll Rises.” The New York Times (Tuesday, January 5, 2021): A1 & A5.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date Jan. 4, 2021, and has the title “New Variant Detected in New York Amid Growing Crisis Over Vaccine Rollout.”)