Category: Regulations

Oregon Gadfly Fined for Practicing Engineering Without a License

(p. B2) Mats Jarlstrom acknowledges that he is unusually passionate about traffic signals — and that his zeal is not particularly appreciated by Oregon officials.
His crusade to make traffic lights remain yellow longer — which began after his wife received a red-light camera ticket — has drawn some interest among transportation specialists and the media. But among the power brokers in his hometown, Beaverton, it has elicited ridicule and exasperation.
“They literally laughed at me at City Hall,” Mr. Jarlstrom recalled of a visit there in 2013, when he tried to share his ideas with city counselors and the police chief.
Worse still was getting hit recently with a $500 fine for engaging in the “practice of engineering” without a license while pressing his cause. So last week, Mr. Jarlstrom filed a civil rights lawsuit in federal court against the Oregon State Board of Examiners for Engineering and Land Surveying, charging the state’s licensing panel with violating his First Amendment rights.
“I was working with simple mathematics and applying it to the motion of a vehicle and explaining my research,” said Mr. Jarlstrom, 56. “By doing so, they declared I was illegal.”
The lawsuit is the latest and perhaps most novel shot in the continuing campaign against the proliferation of state licensing laws that can require costly training and fees before people can work. Mr. Jarlstrom is being represented by the Institute for Justice, a libertarian organization partly funded by the billionaire brothers and activists Charles G. and David H. Koch.

For the full story, see:
PATRICIA COHEN. “Crusader Fined for Doing Math Without License.” The New York Times (Mon., May 1, 2017): B2.
(Note: the online version of the story has the date APRIL 30, 2017, and has the title “Yellow-Light Crusader Fined for Doing Math Without a License.”)

Government Regulations Suppress Poor Street Entrepreneurs

(p. 7) HANOI, Vietnam — As strips of tofu sizzle beside her in a vat of oil, Nguyen Thu Hong listens for police sirens.
Police raids on sidewalk vendors have escalated sharply in downtown Hanoi since March [2017], she said, and officers fine her about $9, or two days’ earnings, for the crime of selling bun dau mam tom — vermicelli rice noodles with tofu and fermented shrimp paste — from a plastic table beside an empty storefront.
“Most Vietnamese live by what they do on the sidewalk, so you can’t just take that away,” she said. “More regulations would be fine, but what the cops are doing now feels too extreme.”
Southeast Asia is famous for its street food, delighting tourists and locals alike with tasty, inexpensive dishes like spicy som tam (green papaya salad) in Bangkok or sizzling banh xeo crepes in Ho Chi Minh City. But major cities in three countries are strengthening campaigns to clear the sidewalks, driving thousands of food vendors into the shadows and threatening a culinary tradition.
. . .
. . . some experts say street food is not inherently less sanitary than restaurant food. “If you’re eating fried foods or things that are really steaming hot, then there’s probably not much difference at all,” said Martyn Kirk, an epidemiologist at the Australian National University.
. . .
Ms. Hong, the Hanoi vendor, said her earnings had cratered by about 60 percent since the start of the crackdown, when she moved to her present location from a busy street corner as a hedge against police raids.

For the full story, see:
MIKE IVES. “Food So Popular, Asian Cities Want It Off the Streets.” The New York Times, First Section (Sun., APRIL 30, 2017): 7.
(Note: ellipses, and bracketed year, added.)
(Note: the online version of the story has the date APRIL 29, 2017, and has the title “Efforts to Ease Congestion Threaten Street Food Culture in Southeast Asia.”)

“The System Is Totally Crazy”

(p. D1) Mr. Ahmed, 46, is in the business of chicken and rice. He immigrated from Bangladesh 23 years ago, and is now one of two partners in a halal food cart that sets up on Greenwich Street close to the World Trade Center, all year long, rain or shine. He is also one of more than 10,000 people, most of them immigrants, who make a living selling food on the city’s sidewalks: pork tamales, hot dogs, rolled rice noodles, jerk chicken.
These vendors are a fixture of New York’s streets and New Yorkers’ routines, vital to the culture of the city. But day to day, they struggle to do business against a host of challenges: byzantine city codes and regulations on street vending, exorbitant fines for small violations (like setting up an inch too close to the curb) and the occasional rage of brick-and-mortar businesses or residents.
. . .
(p. D6) Mr. Ahmed ties on his apron and pushes a few boxes underneath the cart so he can squeeze inside and get to work. Any boxes peeking out beyond the cart’s footprint could result in a fine (penalties can run up to $1,000), as could parking his cart closer than six inches to the curb, or 20 feet to the building entrance. Mr. Ahmed knows all the rules by heart.
. . .
He applied for a food vendor’s license, took a required health and safety class, bought a used cart and took it for an inspection by city officials. (The health department inspects carts at least once a year, and more frequently if a violation is reported.)
Mr. Ahmed still needed a food-vending permit, though, and because of a cap on permits imposed in the 1980s, only 4,000 or so circulate. He acquired his from a permit owner who has charged him and his partner $25,000 for two-year leases (for a permit that cost the owner just $200), which they are still paying off.
A day ago, Mr. Ahmed received a text message: 100 vendors were protesting the cap. Organized by the Street Vendor Project, a nonprofit group that is part of the Urban Justice Center and offers legal representation to city vendors, they hoped to pressure the City Council to pass legislation introduced last fall that would double the number of food-vending permits, gradually, over the next seven years. Mr. Ahmed, who believes the costs for those starting out should be more manageable, wanted to join them, but like many vendors, he couldn’t get away from work.
“The system is totally crazy,” Mr. Ahmed says. “Whoever has a license, give them a permit. It’s good for all of us.”

For the full story, see:
TEJAL RAO. “A Day in the Lunch Box.” The New York Times (Weds., APRIL 19, 2017): D1 & D6.
(Note: ellipses added.)
(Note: the online version of the story has the date APRIL 18, 2017, and has the title “A Day in the Life of a Food Vendor.”)

Middle Class Wants to Be Free to Choose Skinnier Health Insurance

(p. B4) For Linda Dearman, the House vote last week to repeal the Affordable Care Act was a welcome relief.
Ms. Dearman, of Bartlett, Ill., voted for President Trump largely because of his contempt for the federal health law. She and her husband, a partner in an engineering firm, buy their own insurance, but late last year they dropped their $1,100-a-month policy and switched to a bare-bones plan that does not meet the law’s requirements. They are counting that the law will be repealed before they owe a penalty.
“Now it looks like it will be, and we’re thrilled about that,” Ms. Dearman, 54, said. “We are so glad to feel represented for a change.”
. . .
In interviews over the last few days, people who support repealing the Affordable Care Act pointed to their long-simmering resentment of its mandate that most Americans have health insurance or pay a tax penalty. Many also said that they could no longer afford the comprehensive coverage available on the individual market, and that they were eager to once again be allowed to choose skinnier policies without a penalty.
“Now I will no longer be expected to pay twice what I should for a product I don’t need and be treated like a criminal with a fine if I refuse,” said Edward Belanger, 55, a self-employed business appraiser in Dallas. He is an independent who usually votes Republican but last year chose Gary Johnson, the Libertarian candidate, over Mr. Trump.
Like the Dearmans, Mr. Belanger canceled a plan that complies with the Affordable Care Act and bought a short-term policy that does not meet the law’s standards, paying $580 a month for his family of four compared with the nearly $1,200 a month he paid last year. Policies like theirs usually have high deductibles and primarily offer catastrophic coverage for major injuries.

For the full story, see:
ABBY GOODNOUGH. “Feeling Hurt By Health Law, and Eager to See G.O.P. Repeal It.” The New York Times (Tues., May 16, 2017): A12.
(Note: ellipsis added.)
(Note: the online version of the story has the date May 12, 2017, and has the title “Why Some Can’t Wait for a Repeal of Obamacare.”)

Banks Often Less Transparent and Less Flexible than Bank Alternatives

I saw a C-Span interview on their weekend Book TV today (3/16/17), with Professor Lisa Servon. She pointed out that many of the highly regulated, and much-criticized, alternative banking services, offer a more transparent, more flexible, and more friendly service environment than the incumbent banking industry. She even argues that for those with low-incomes, and low-education, the alternative services are often less expensive. This happens because those with low-incomes and low education are often those who by mistake or by difficult circumstance, incur high fees at banks.
She points out that many who are bankless, previously made use of bank services, but decided to go with the alternatives. She suggested that in a free market environment, some of the alternatives might creatively destroy the incumbent banks.
Servon is clearly no libertarian, but much of what she says is thought-provoking.

Servon’s book is:
Servon, Lisa. The Unbanking of America: How the New Middle Class Survives. New York: Houghton Mifflin Harcourt Publishing Co., 2017.

Lower Quality Restaurants Most Hurt by Minimum Wage Hike

(p. A17) “There’s only so much you can charge for tamales,” the owner of a small eatery said in 2015 to explain one reason he was closing.
For some empirical backup, consider an April [2017] study from Michael Luca at Harvard Business School and Dara Lee Luca at Mathematica Policy Research. They used Bay Area data from the review website Yelp to estimate that a $1 minimum-wage hike leads to a 14% increase in “the likelihood of exit for a 3.5-star restaurant.”
Put differently, San Francisco’s minimum wage experiment may be dangerous for your favorite white-tablecloth restaurant–the kind of place where the food is exquisite and can command a premium–but it’s downright deadly for your local white-apron diner.

For the full commentary, see:

Michael Saltsman. “The Minimum Wage Eats Restaurants; A San Francisco ex-owner says: ‘There’s only so much you can charge for tamales.’.” The Wall Street Journal (Weds., May 9, 2017): A17.
(Note: bracketed year added.)
(Note: the online version of the commentary has the date May 9, 2017,)

The Luca and Luca paper, mentioned above, is:
Luca, Dara Lee and Luca, Michael. “Survival of the Fittest: The Impact of the Minimum Wage on Firm Exit.” (April 2017). Harvard Business School NOM Unit Working Paper No. 17-088.

Tinkerers Build Their Own Pancreases, While Waiting for 100,000 Page Submission to FDA

(p. B1) Third-grader Andrew Calabrese carries his backpack everywhere he goes at his San Diego-area school. His backpack isn’t just filled with books, it is carrying his robotic pancreas.
The device, long considered the Holy Grail of Type 1 diabetes technology, wasn’t constructed by a medical-device company. It hasn’t been approved by regulators.
It was put together by his father.
Jason Calabrese, a software engineer, followed instructions that had been shared online to hack an old insulin pump so it could automatically dose the hormone in response to his son’s blood-sugar levels. Mr. Calabrese got the approval of Andrew’s doctor for his son to take the home-built device to school.
The Calabreses aren’t alone. More than 50 people have soldered, tinkered and written software to make such devices for themselves or their children. The systems–known in the industry as artificial pancreases or closed loop systems–have been studied for decades, but improvements to sensor technology for real-time glucose monitoring have made them possible.
The Food and Drug Administration has made approving such devices a priority and several companies are working on them. But the yearslong process of commercial development and regulatory approval is longer than many patients want, and some are technologically savvy enough to do it on their own.
. . .
(p. B2) “Biology isn’t quite as easy as controlling the temperature in a room,” said Francine Kaufman, chief medical officer for Medtronic’s diabetes division. She sees do-it-yourself efforts as a sign of the interest in the technology, but distinct from the process of getting a commercial device to market. Dr. Kaufman estimates Medtronic’s submission to the FDA will exceed 100,000 pages and hopes that the device will be approved in 2017.
The home-built project that the Calabreses followed, known as OpenAPS, was started by Dana Lewis, a 27-year-old with Type 1 diabetes in Seattle. Ms. Lewis began using the system in December 2014 as a sort of self-experiment. After months of tweeting about it, she attracted others who wanted what she had.
. . .
The FDA declined to comment on the project but said the agency is working with manufacturers to approve a device.
Sarah Howard became interested after she met Ms. Lewis last year. “My first question was: Was it legal?” said the 49-year-old, who has Type 1 diabetes, as does one of her two sons. “I didn’t want to do anything illegal.”
​After ​her husband ​built​ the system for her and her son, she said the main benefit is starting each day with her blood sugar in range and not having to wake in the night to check her son’s glucose levels.

For the full story, see:
Kate Linebaugh. “Tech-Savvy Families Build Robotic Pancreas; Companies work on developing diabetes device, but approval process is too long for many patients.” The Wall Street Journal (Mon., May 9, 2016): B1-B2.
(Note: ellipses added.)
(Note: the online version of the story has the Tech-Savvy Families Use Home-Built Diabetes Device; Companies work on artificial pancreas, but approval process is too long for many patients.”)

Fewer Regulations and Lower Taxes Rouse “Animal Spirits” in Small Businesses

(p. B1) More than any other president since Ronald Reagan, President Trump is moving to strip away regulations and slash taxes, said Jeffrey Korzenik, an investment strategist with Fifth Third, a large regional bank in the Midwest and Southeast. In meetings with clients, Mr. Korzenik has been making the case that these policies will rouse the slumbering animal spirits in businesses across America.
“And now we have seen this huge spike in small-business confidence since the election,” Mr. Korzenik said, pointing to a chart. “So I have to ask you: Do you feel more confident now?”
There was a moment of silence, broken only by a howling northwestern Ohio wind that rattled the floor-to-ceiling windows in the bank’s boardroom.
Then, with rapid-fire speed, came the responses.
The president of a trucking company spoke of a “tremendous dark cloud” lifting when he realized he would no longer be feeling the burden of rules and regulations imposed by the Obama administration.
The owner of an automotive parts assembler gave thanks that he would not be receiving visits from pesky envi-(p. B3)ronmental and workplace overseers.
And the head of a seating manufacturer expressed hope that, finally, his health care costs would come down when the Affordable Care Act was repealed.
“My gut just feels better,” said Bob Fleisher, president of a local car dealership. “With Obama, you felt it was personal — like he just didn’t want you to make money. Now we have a guy who is cutting regulations and taxes. And when I see my taxes going down every quarter — well, that means I am going to start investing again.”
. . .
A heavier regulatory burden and uncertainty born of a weak economic recovery have kept small-business owners from making big bets in investments or hiring.
But in Toledo, this reluctance is changing — and quickly.
Louis M. Soltis owns a small company that manufactures control panels for large factories and machines. After four years of not adding to his work force of 22, he has seen orders for panels jump in the last two months and is looking to take on as many as six new workers.
There may not be a direct correlation between his surging order book and the new president, but there is no doubting the psychological boost.
“That guy is a junkyard dog, doing his tweets at 3 a.m. and taking on the news media — I just get strength from him,” Mr. Soltis said over a wine-soaked dinner with a large group of his small-business friends and peers from around town. “And I have to say, it makes you feel gutsy — ready to step up and start investing again.”
. . .
Yet there is a downside to animal spirits that persist too long, especially in labor markets, like Toledo’s, that are operating on the tight side.
And that is a sharp uptick in inflation.
In his presentation to Fifth Third’s banking clients, Mr. Korzenik raised this issue, suggesting that the broader economy was in the “seventh inning” of what has been a pretty long business cycle.
. . .
Still, no one in the room seemed overly concerned. As the group saw it, the party was just beginning.
“Most businesses I know are just taking a deep breath, happy that there is finally someone in the White House who understands what they do,” said Mr. Fleisher, the owner of the Lincoln car dealership. “So you say we are in the seventh inning — well, I am not sure we are.”

For the full story, see:
LANDON THOMAS Jr. “Small Businesses’ Hopes Are Up.” The New York Times (Mon., MARCH 13, 2017): B1 & B3.
(Note: ellipses added.)
(Note: the online version of the story has the date MARCH 12, 2017, and has the title “The President Changed. So Has Small Businesses’ Confidence.”)

Restaurants Add Labor Surcharges to Help Pay Minimum Wage Costs

(p. B1) In lieu of steep menu price increases, many independent and regional chain restaurants in states including Arizona, California, Colorado and New York are adding surcharges of 3% to 4% to help offset rising labor costs. Industry analysts expect the practice to become widespread as more cities and states increase minimum wages.
“It’s the emerging new norm,” said Sharokina Shams, spokeswoman for the California Restaurant Association. She said California restaurants are adding surcharges as the state lifts the minimum wage every year until it reaches $15 an hour by 2023. It is currently at $10.50 an hour for employers with 26 or more workers.
. . .
While adding a surcharge risks turning diners away, some restaurateurs say they want customers to understand the consequences of higher wages on a business with profit margins of generally between 2% and 6%.
. . .
(p. B2) Sami Ladeki added surcharges to the menu at six Sammy’s Woodfired Pizza & Grill restaurants in San Diego and eight more across California. He said it was a mistake to call the charge a state mandate, and has changed the wording. But he remains critical of rising minimum wages.
“This is not sustainable,” said Mr. Ladeki, who says he makes a profit of around 1% charging $12 to $14 a pizza. “People are not going to pay $15 or $20 for a pizza.”
. . .
David Cohn, who owns 15 restaurants in San Diego, including BO-beau, said his 3% surcharge wasn’t a stunt.
“We want people to understand there is a cost,” Mr. Cohn said. “How do we stay in business with margins shrinking and competition increasing?”

For the full story, see:
JULIE JARGON. “New on Your Dinner Tab: A Labor Surcharge.” The Wall Street Journal (Fri., March 10, 2017): B1-B2.
(Note: ellipses added.)
(Note: the online version of the story has the date March 9, 2017.)

China’s “Ruthless” One Child Policy Forced Some Women to Have Abortions

(p. 15) Deng Xiaoping, China’s leader after 1978, had set a target of quadrupling the country’s per capita national income by 2000. China’s planners decided that they could achieve this goal only if, in addition to increasing the size of the pie, there were fewer people to share it.
So they determined, in their words, to “adjust women’s average fertility rate in advance.” The man who ran the program that treated women as if they were production functions was a rocket scientist, Song Jian, who had worked on ballistic missiles. Song went on to help manage the giant Three Gorges Dam on the Yangtze River. His was a world in which unintended consequences were not important.
Population control was not unusual in the 1980s. India also had a fertility-­control program. The United Nations gave its first-ever population award to the Chinese minister for population planning in 1983 (along with Indira Gandhi). But China’s application of population control was particularly ruthless.
In 2012, Feng Jianmei, a factory worker pregnant with her second child, was taken to a clinic, forced to sign a document consenting to an abortion and injected with an abortifacient. She was in her seventh month. Pictures of her lying next to her perfectly formed seven-month dead fetus went viral. But hers was hardly an unusual case. In the 1990s, population targets became a major criterion for judging the performance of officials. It is no surprise that they carried out the one-child policy ruthlessly. Reading this account, one wonders why rape as a weapon of war is (rightly) seen as a war crime, whereas the forcible violation of women’s bodies in pursuit of government policy wins United Nations awards.

For the full review, see:
JOHN PARKER. “Little Emperors.” The New York Times Book Review (Sun., JAN. 10, 2016): 15.
(Note: the online version of the review has the date JAN. 8, 2016, and has the title “”One Child,’ by Mei Fong.”)

The book under review, is:
Fong, Mei. One Child: The Story of China’s Most Radical Experiment. Boston, MA: Houghton Mifflin Harcourt, 2016.

How Uber Resisted Regulation

(p. B1) Uber Technologies Inc. has for years employed a program that uses data from its ride-hailing app and other tools to evade government officials seeking to identify and block the service’s drivers, according to a person familiar with the matter.
. . .
Uber has set up GPS rings around government offices, tracked low-cost phones and looked for other clues that regulators were targeting its drivers, such as frequently opening or closing the app or using credit cards tied to city agencies, according to the Times report. Once identified, Uber kept regulators out of vehicles by failing to send drivers their way, according to the newspaper.

For the full story, see:
GREG BENSINGER. “Uber Used Program to Evade Authorities.” The Wall Street Journal (Mon., March 6, 2017): B4.
(Note: ellipsis added.)
(Note: the online version of the story has the date March 4, 2017, and has the title “Uber Used ‘Greyball’ Program to Circumvent Authorities.” )