Category: Regulations

N.Y.C. Regulation of Uber and Lyft Hurts Poor Blacks and Hispanics

(p. A1) Jenine James no longer worries about getting stranded when the subways and buses are unreliable — a constant frustration these days — or cannot take her to where she needs to go. Her Plan B: Uber.
So Ms. James, 20, a barista in Brooklyn, sees New York’s move to restrict ride-hail services as not just a threat to her own convenience and comfort but also to the alternative transportation system that has sprung up to fill in the gaps left by the city’s failing subways and buses. She does not even want to think about going back to a time when a train was her only option, as unlikely as that might be.
“It was bad, so imagining going back, it’s terrible,” she said.
The ride-hail cars that critics say are choking New York City’s streets have also brought much-needed relief to far corners of the city where just getting to work is a daily chore requiring long rides and multiple transfers, often squeezed into packed trains and buses. The black cars that crisscross transit deserts in Brooklyn, Queens, the Bronx and Staten Island have become staples in predominantly black and Hispanic neighborhoods where residents complain that yellow taxis often refuse to pick them up. They come to the rescue in the rain, and during taxi shift changes, when rides are notoriously hard to find even (p. A19) in the heart of Manhattan.
New York became the first major American city on Wednesday [Aug. 8, 2018] to put a halt on issuing new vehicle licenses for Uber, Lyft and other ride-hail services amid growing concerns around the world about the impact they are having on cities.
The legislation calls for a one-year moratorium while the city studies the booming industry and also establishes pay rules for drivers. It was passed overwhelmingly by the City Council and is expected to be signed into law by Mayor Bill de Blasio, a Democrat, who attempted to adopt a similar cap in 2015 but abandoned the effort after Uber waged a fierce campaign against him.

For the full story, see:
Winnie Hu and Mariana Alfaro. “‘At End of Line, A Cap on Uber Causes Distress.” The New York Times (Friday, Aug. 10, 2018): A1 & A19.
(Note: bracketed date, added.)
(Note: the online version of the story has the date Aug. 9, 2018, and has the title “‘Riders Wonder: With Uber as New York’s Plan B, Is There a Plan C?”)

Alibaba’s Jack Ma Retires Early as Chinese Communists Intervene in Ventures

(p. B1) HONG KONG — Alibaba’s co-founder and executive chairman, Jack Ma, said he planned to step down from the Chinese e-commerce giant on Monday to pursue philanthropy in education, a changing of the guard for the $420 billion internet company.
A former English teacher, Mr. Ma started Alibaba in 1999 and built it into one of the world’s most consequential e-commerce and digital payments companies, transforming how Chinese people shop and pay for things. That fueled his net worth to more than $40 billion, making him China’s richest man. He is revered by many Chinese, some of whom have put his portrait in their homes to worship in the same way that they worship the God of Wealth.
Mr. Ma is retiring as China’s business environment has soured, with Beijing and state-owned enterprises increasingly playing more interventionist roles with companies. Under President Xi Jinping, China’s internet industry has grown and become more important, prompting the government to tighten its leash. The Chinese economy is also facing slowing growth and increasing debt, and the country is embroiled in an escalating trade war with the United States.
“He’s a symbol of the health of China’s private sector and how high they can fly whether he likes it or not,” Duncan Clark, author of the book “Alibaba: The House Jack Ma Built,” said of Mr. Ma. “His retirement will be interpreted as frustration or concern whether he likes it or not.”
In an interview, Mr. Ma said his retirement is not the end of an era but “the beginning of an era.” He said he would be spending more of his time and fortune focused on education. “I love education,” he said.
Mr. Ma will remain on Alibaba’s board of directors and continue to mentor the company’s management. Mr. Ma turns 54 on Monday, which is also a holiday in China known as Teacher’s Day.
The retirement makes Mr. Ma one of the first founders among a generation of prominent Chinese internet entrepreneurs to step down from their companies. Firms including Alibaba, Tencent, Baidu and JD.com have flourished in recent years, growing to nearly rival American internet behemoths like Amazon and Google in their size, scope and ambition. For Chinese tycoons to step aside in their 50s is rare; they usually remain at the top of their organizations for many years.

For the full story, see:

Li Yuan. “Founder Sees A ‘Beginning’ As He Retires From Alibaba.” The New York Times (Saturday, Sept. 8, 2018): B1 & B3.
(Note: the online version of the story has the date Sept. 7, 2018, and has the title “Alibaba’s Jack Ma, China’s Richest Man, to Retire From Company He Co-Founded.”)

The book by Duncan Clark, that is mentioned above, is:
Clark, Duncan. Alibaba: The House That Jack Ma Built. New York: Harper-Collins Publishers, 2016.

Uncredentialed Entrepreneur Innovated to Save Babies

(p. 1A) He showed up in Omaha 120 summers ago, another unknown showman hoping to make a name for himself at this city’s biggest-ever event, its world’s fair.

He gave his name as Martin Couney, or sometimes Martin Coney. It wasn’t, at least not yet.
He said he was a doctor, a European doctor, a protégé of the world’s finest doctors. He was none of these things.
And yet in Omaha, Dr. Couney set up shop in a little white building on the east midway, not far from the Wild West Show, the Middle Eastern dancers, the roaming fortune tellers and the Indian Congress starring a Native American chief named Geronimo.
The fair, officially known as the Trans-Mississippi and International (p. 2A) Exposition, showcased all manner of things seen as strange, exotic and otherworldly to the 2 million Nebraskans and visitors paying the 50-cent admission to have their minds blown in the summer of 1898.
Couney thought he had just the thing to blow their minds.

“Infant Incubators with Living Infants” read the sign above the entrance.

“A Wonderful Invention … Live Babies” said another.
. . .
Usually the experts are right. That’s why they are experts,” says Dawn Raffel, author of the “The Strange Case of Dr. Couney,” a new biography seeking to save this once-famed faux doctor from history’s trash bin. “But occasionally you get an outlier like this. Someone who is extraordinarily inventive. Who brings us something incredible.”
What Dr. Couney gave us, through decades of work and tireless promotion, was an understanding that we could save babies that since the beginning of time had died before they crawled. We could save them using a piece of equipment designed by a French engineer who realized that if an egg could be nurtured in an incubator, then so could a newborn.
. . .
Newspapers, including The World-Herald, largely ignored the exhibit, Raffel says. The public didn’t seem particularly bothered that a “doctor” had decided to house anonymous newborns on the fairgrounds and put them on public display.
They also didn’t seem particularly interested, either.
. . .
Raffel estimates that Couney and his doctors and nurses saved between 6,500 and 7,000 premature babies all on their own during decades of midway work. But they saved countless thousands more by raising the profile of premature babies. By raising the hope that they could grow into healthy, happy adults.
. . .
“I find him fascinating because he was such a complicated man,” Raffel says. “He deserves more credit.”

For the full story, see:
Hansen, Matthew. “Tech Costs Force Honda To Let Go of Engineering Legacy.” Omaha World-Herald (Friday, Aug. 3, 2018): 1A-2A.
(Note: ellipses between paragraphs, added; ellipsis internal to sentence, in original.)

The Raffel book on which the passages quoted are partially based, is:
Raffel, Dawn. The Strange Case of Dr. Couney: How a Mysterious European Showman Saved Thousands of American Babies. New York: Blue Rider Press, 2018.

Soichiro Honda Rushed Prototype Car “in Defiance of a Planned Japanese Law”

(p. A10) For many Japanese, Honda reflected the originality and self-confidence that turned the country into an industrial powerhouse after World War II.
. . .
The company was founded in 1946 by Soichiro Honda, a tinkerer who loved to battle the giants with his own innovations. He and a dozen workers took engines intended for small electric generators and attached them to bicycles, the first Honda product. Within 15 years, a Honda motorcycle was beating European rivals at the Isle of Man motorcycle race.
Around that time, Mr. Honda rushed out a prototype automobile despite having almost no experience in building them, in defiance of a planned Japanese law that would have restricted entry in the market.

For the full story, see:
Sean McLain. “Tech Costs Force Honda To Let Go of Engineering Legacy.” The Wall Street Journal (Monday, Aug. 6, 2018): A1 & A10.
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 5, 2018, and has the title “Honda Took Pride in Doing Everything Itself. The Cost of Technology Made That Impossible.”)

Central Banks Epitomize the Administrative State

(p. A15) The promise of the modern central bank is that it will make its corner of the economic-policy world technocratic and academic–in a word, boring.
The lesson of the past decade is that this promise is a lie. The developed world’s four major central banks–the Fed, the Banks of England and Japan, and the European Central Bank–have executed a series of extraordinary policy maneuvers to rescue us from the 2008 financial panic, with debatable success. These include ultralow or negative interest rates; the purchase of sovereign debt in mind-boggling quantities; forays into commercial debt, equity and real-estate markets; and ventures into mortgages, small-business loans and other similar instruments. Central banks have also taken on vast new supervisory powers over the financial system. Each of these measures has had profound effects on our economies: debtors win, savers lose; large, bond-issuing companies get credit, smaller firms don’t; owners of assets accumulate wealth, wage earners see their salaries endangered by inflation. Such distributional choices are normally left to elected leaders, but no one elects a central bank.
Mr. Tucker reminds us how this happened. He places the development of modern central banking firmly within the wider story of administrative governance in the 20th century and its expansion at the expense of electoral accountability. “Central banks might well be the current epitome of unelected power,” he writes, “but they are part of broader forces that have been reshaping the structure of modern governance.” His brief account of the Fed’s history starts not at the usual spot–the 1907 panic and its aftermath–but with the creation of the Interstate Commerce Commission, in 1887, taken by some as the first step in the development of America’s modern bureaucracy.

For the full review, see:
Joseph C. Sternberg. “BOOKSHELF; ‘Unelected Power’ Review: Monetary Mavericks; The question is not whether recent interventions by central banks were effective, but whether they were legitimate.” The Wall Street Journal (Thursday, June 28, 2018): A15.
(Note: the online version of the review has the date June 27, 2018, and has the title “BOOKSHELF; ‘Unelected Power’ Review: Monetary Mavericks; The question is not whether recent interventions by central banks were effective, but whether they were legitimate.”)

The book under review, is:
Tucker, Paul. Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State. Princeton, NJ: Princeton University Press, 2018.

Flying Is Cheaper and More Convenient After Deregulation

(p. 3) Since the industry was deregulated in 1979, increased competition and airline consolidation caused airfares, when adjusted for inflation, to drop 40 percent, according to the Eno Center for Transportation, a Washington, D.C.-based think tank devoted to transportation issues. In 2016, it found the average domestic round-trip ticket in the United States cost $367 versus $187 in 1979.
“Airlines became very efficient at trying to get as many paying passengers onboard per flight,” said Paul Lewis, the vice president of policy and finance at the Eno Center. “Seats got closer, load factors got higher and while we don’t tend to like cramming into an airplane, that’s how we’re able to enjoy relatively low fares.”
Technology advancements and the surge in low-cost carriers, particularly on international routes, have made flying more convenient, if not necessarily more comfortable.

For the full commentary, see:

Elaine Glusac. “THE GETAWAY; Tickets From Here to There for Less.” The New York Times, Travel Section (Sunday, July 14, 2018): 3.
(Note: the online version of the commentary has the date July 13, 2018, and has the title “THE GETAWAY; Fly Farther, for Cheaper. For Now..”)

Zuckerberg Calls Musk “Pretty Irresponsible” on A.I. “Doomsday” Fears

(p. 1) SAN FRANCISCO — Mark Zuckerberg thought his fellow Silicon Valley billionaire Elon Musk was behaving like an alarmist.
Mr. Musk, the entrepreneur behind SpaceX and the electric-car maker Tesla, had taken it upon himself to warn the world that artificial intelligence was “potentially more dangerous than nukes” in television interviews and on social media.
So, on Nov. 19, 2014, Mr. Zuckerberg, Facebook’s chief executive, invited Mr. Musk to dinner at his home in Palo Alto, Calif. Two top researchers from Facebook’s new artificial intelligence lab and two other Facebook executives joined them.
As they ate, the Facebook contingent tried to convince Mr. Musk that he was wrong. But he wasn’t budging. “I genuinely believe this is dangerous,” Mr. Musk told the table, according to one of the dinner’s attendees, Yann LeCun, the researcher who led Facebook’s A.I. lab.
Mr. Musk’s fears of A.I., distilled to their essence, were simple: If we create machines that are smarter than humans, they could turn against us. (See: “The Terminator,” “The Matrix,” and “2001: A Space Odyssey.”) Let’s for once, he was saying to the rest of the tech industry, consider the unintended consequences of what we are creating before we unleash it on the world.
. . .
(p. 6) Since their dinner three years ago, the debate between Mr. Zuckerberg and Mr. Musk has turned sour. Last summer, in a live Facebook video streamed from his backyard as he and his wife barbecued, Mr. Zuckerberg called Mr. Musk’s views on A.I. “pretty irresponsible.”
Panicking about A.I. now, so early in its development, could threaten the many benefits that come from things like self-driving cars and A.I. health care, he said.
“With A.I. especially, I’m really optimistic,” Mr. Zuckerberg said. “People who are naysayers and kind of try to drum up these doomsday scenarios — I just, I don’t understand it.”

For the full story, see:
Cade Metz. “Moguls and Killer Robots.” The New York Times, SundayBusiness Section (Sunday, June 10, 2018): 1 & 6.
(Note: ellipsis added.)
(Note: the online version of the story has the date June 9, 2018, and has the title “Mark Zuckerberg, Elon Musk and the Feud Over Killer Robots.”)

“It’s Time for the FDA to Get with the Program”

(p. A14) Are eggs good for you or not?
It’s never been more confusing for consumers to answer that seemingly simple question. Vilified for years for their high cholesterol content, eggs more recently have broken back into dietary fashion. Nutrition experts today are touting eggs’ high levels of protein, essential vitamins and nutrients like brain-booster choline.
Government guidelines sometimes contradict nutrition experts’ advice as they play catch up with the latest scientific findings. Dietary advice from the U.S. departments of agriculture and health and human services includes eggs as part of a healthy diet, but also says cholesterol intake should be as low as possible. And the Food and Drug Administration says that eggs are too high in total fat, saturated fat and cholesterol to be labeled “healthy” by food marketers.
It’s such a scrambled issue that one egg brand is petitioning for an official government reassessment of eggs. “There’s so much new science out there about eggs, it’s time for the FDA to get with the program,” says Jesse Laflamme, chief executive of Pete and Gerry’s Organics, who filed a citizen’s petition urging the agency to rethink its ban on calling eggs “healthy.”

For the full commentary, see:
Ellen Byron. “The Great Egg Conundrum.” The Wall Street Journal (Wednesday, June 13, 2018): A14.
(Note: the online version of the commentary has the date June 12, 2018, and has the title “The Great Egg Debate: Are They Healthy or Not?”)

NYC Government Hid Public Housing Lead Paint Violations

(p. A1) The federal government on Monday [June 11, 2018] delivered a withering rebuke of New York City’s housing authority, accusing officials of systematic misconduct, indifference and outright lies in the management of the nation’s oldest and largest stock of public housing.
Federal prosecutors in Manhattan said the authority, which houses at least 400,000 poor and working-class residents, covered up its actions, training its staff on how to mislead federal inspectors and presenting false reports to the government and to the public about its compliance with lead-paint regulations. The failures endangered tenants and workers for years, the prosecutors said, and potentially left more children than previously known poisoned by lead paint in their apartments.
The accusations were contained in an 80-page civil complaint filed against the authority on Monday in federal court by the office of Geoffrey S. Berman, the United States attorney in Manhattan, after a lengthy investigation.
The problems at the authority “reflect management dysfunction and organizational failure,” the prosecutors said, “including a culture where spin is often rewarded and accountability often does not exist.”

For the full story, see:
Benjamin Weiser and J. David Goodman. “Rot, Deception and Danger in Public Housing.” The New York Times (Tuesday, June 12, 2018): A1 & A21.
(Note: bracketed date added.)
(Note: the online version of the story has the date June 11, 2018, and has the title “New York City Housing Authority, Accused of Endangering Residents, Agrees to Oversight.”)

Drones “Stifled” by Stringent Regulations

(p. B5) The commercial drone industry is being stifled by unnecessarily stringent federal safety rules enforced by regulators who frequently pay only lip service to easing restrictions or streamlining decision-making, according to a report by the National Academies of Sciences, Engineering and Medicine.
The unusually strongly worded report released Monday [June 11, 2018] urges “top-to-bottom” changes in how the Federal Aviation Administration assesses and manages risks from drones.
. . .
. . . minimal but persistent levels of risk already are accepted by the public,according to the report. A fundamental issue is “what are we going to compare [drone] safety to?” said consultant George Ligler, who served as chairman of the committee that drafted the document.
“We do not ground airplanes because birds fly in the airspace, although we know birds can and do bring down aircraft,” the report said.

For the full story, see:
Andy Pasztor. “FAA’s Safety Rules for Commercial Drones Are Overly Strict, Report Says.” The Wall Street Journal (Tuesday, June 12, 2018): B5.
(Note: ellipses, and bracketed date, added.)
(Note: the online version of the story has the date June 11, 2018, and has the title “FAA’s Safety Rules for Commercial Drones Are Overly Strict, Report Says.”)

Regulations Support Car Incumbents and Undermine Tesla Profitability

(p. A13) . . . governments everywhere have decided, perversely, that electric cars will not be profitable. In every major market–the U.S., Europe, China–the same political dispensation now applies: Established auto makers effectively will be required to make and sell electric cars at a loss in order to continue profiting from gas-powered vehicles.
This has rapidly become the institutional structure of the electric-car industry world-wide, for the benefit of the incumbents, whether GM in the U.S. or Daimler in Germany. Let’s face it, the political class always had a bigger investment in these incumbents than it ever did in Tesla.
Tesla has a great brand, great technology and great vehicles. To survive, it also needs to mate itself to a nonelectric pickup truck business. . . .
We’ll save for another day the relating of this phenomenon to Mr. Musk’s recently erratic behavior and pronouncements. . . . Keep your eye on the bigger picture–the bigger picture is the global regulatory capture of the electric car moment by the status quo. And note the irony that Tesla’s home state of California was the original pioneer of this insiders’ regulatory bargain with its so-called zero-emissions-vehicle mandate.
Electric cars were going to remain a niche in any case, but public policy is quickly ruling out the possibility (which Tesla needed) of them at least being a profitable niche.

For the full commentary, see:
Holman W. Jenkins, Jr. “BUSINESS WORLD; A Tesla Crackup Foretold; The real problem is that governments everywhere have ordained that electric cars will be sold at a loss.” The Wall Street Journal (Saturday, June 23, 2018): A13.
(Note: ellipses added.)
(Note: the online version of the commentary has the date June 22, 2018.)