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Google Mugged By Reality?

Tuesday, July 22nd, 2014

Google says health care is unhealthy.

Venture capitalist Vinod Khosla has conducted what he calls a “fireside chat” with Google founders Larry Page and Sergey Brin. In one much-cited passage, Brin observes that although he is excited about making gadgets like glucose-measuring contact lenses, health care, because “so heavily regulated,” is “just a painful business to be in. It’s not necessarily how I want to spend my time. . . . [T]he regulatory burden in the U.S. is so high that I think it would dissuade a lot of entrepreneurs.” Page echoes his colleague.

A blunt, and fair, observation. But it makes one wonder why these super-entrepreneurs have not been more critical (at least so far as their search engine can tell me) of Obamacare, which multiplies mandates and prohibitions in the medical industry by an order of magnitude.

Top Google executives are known to be liberal in their politics, and presumably have been sincere. It seems, though, that reality is not cooperating with any ideological tilt they may yet harbor in favor of government paternalism.

It’s in fields with which a businessman is best acquainted that he is most likely to recognize the value of freedom — at least his own, if not always that of competitors. So perhaps we should hope that Brin, Page and other Google principals try to achieve something great in every industry there is. That way, they can come around to consistent, principled support for freeing markets.

This is Common Sense. I’m Paul Jacob.

Let Us Drive

Thursday, July 17th, 2014

How about letting us drive?

Who’s us? Passengers—taxi-ride buyers. Plus anyone else who participates in the market transactions that take us places.

Many Orlando, Florida cabbies are eager to work with the ride-sharing company that makes the smartphone app Uber. They’re tired of leasing cabs for $129 a day while scrambling for enough price-controlled fares to earn a decent living after paying that steep cost. Uber drivers provide their own car and let the firm’s technology connect them to customers. Uber gets 20 percent of fare revenue.

The politics are mostly hostile to the innovation in places like New York City where markets are mangled by super-high license fees and other regulations. The politics are also tough in Orlando, which has been cracking down on Uber drivers. But the mayor and Uber executives have been talking about a deal under which Uber could operate if it submits to . . . regulation. (Sigh.)

Cab companies in the City Beautiful expect to rapidly lose revenue if innovators like Uber and Lyft get to operate freely. But Orlando taxi drivers expect to gain.

“If you talk to 1,000 drivers,” says one, “950 will tell you they are going to Uber.” Says another: “Let Uber come here. It’s going to be good for the customer and the driver.”

Let them come. Also kill all regulations, including fare caps, that make it harder for cab companies to adapt. Let terms of trade be driven—regulated—by traders. Not by governments.

This is Common Sense. I’m Paul Jacob.

Greek Recipe for Disaster

Thursday, July 10th, 2014

Several years ago, Despina Antypa and her husband worked at a leading newspaper in Athens.

Then came the economic crisis.

The bad news was “just a whisper” at first. But when friends began losing work, she had the foresight and discipline to plan a new career. One unrestricted by language or country — just in case they ever had to leave Greece. She chose pastry, taking classes every weekday for two years, practicing techniques on weekends.

Sure enough, in 2011 the couple lost their own jobs. Despina threw herself into the task of confecting a signature delicacy good enough to sell; some 3,000 trials and errors (“mostly errors”) later, she was satisfied.

Then came the work of developing a website, packaging, selling.

Orders poured in. The labors were paying off. Except that—

The business was killed in its crib by bureaucrats.

The Greek government demanded a lot, including

  • advance taxes equal to “50 percent of estimated profit in the first two years” (money never to be returned were the business to fail);
  • minimum square footage for her shop much greater than necessary; and
  • a separate toilet for walk-in customers (although there would be no walk-in customers).

The arbitrary burdens proved too great. In 2013, her husband got a job offer that meant moving to Brussels. They jumped at the chance. There they forged the new life they could have forged in Greece — had they been allowed to.

It seems that the road to recovery is not helped by hobbling the runners.

This is Common Sense. I’m Paul Jacob.

Central Banks Losing Control

Wednesday, July 9th, 2014

The rapid rise of interest in and use of “virtual currencies” like Bitcoin has been astounding. It probably won’t surprise you to learn what the established masters of the worlds’ monies say: Bitcoin is disruptive!

Heavens.

Bogdan Ulm, writing on Bitcoin Trader, noticed the concern in Ireland:

“Virtual and digital currencies can challenge the sovereignty of states,” says Gareth Murphy, senior Central Bank of Ireland official. At a recent digital money conference in Dublin, he mentioned that rivals are interfering with a bank’s ability to sway the price of credit for the entire economy. Murphy warned that there might be considerable threat to the finances of a country if increasingly more transactions for services and goods fade away from the tax system due to the use of crypto currencies such as Bitcoin.

Now, it’s worth mentioning that there are many economists — from a long tradition — who have denied the necessity of anyone acquiring the ability to “sway the price of credit for the entire economy.”

Separate bids and offers for credit (loaning money with interest) can be seen as signals of competing evaluations in the economy. There are tremendous forces pushing interest rates to align, and when they do (or don’t), their alignment (or lack thereof) sends important additional information to market participants about both the present and the future.

But when anyone (say, a central bank) presumes to corral all interest rates into a “coherent plan,” much of the useful meaning of signals gets lost, or jumbled, and the economy gets (inadvertently?) programmed for boom and bust.

So, when I hear that modern digital currencies could prevent central banks from “doing their business,” I wonder if, perhaps, this is not a good thing.

This is Common Sense. I’m Paul Jacob.

Now Okay to Walk and Talk in DC

Monday, July 7th, 2014

Tourist guides in our nation’s capital now get to talk through what they’re walking through.

DC circuit Judge Janice Brown rules that Washington, DC, wrongly burdens First Amendment rights when it prohibits talking “about points of interest or the history of the city while escorting or guiding a person who paid you to do so — that is, unless you pay the government $200 and pass a 100-question multiple-choice exam.” Until her ruling, the city could jail guides for 90 days and/or fine you up to $300 for daring to walk and talk professionally without going through the hoops of regulation and licensing.

Chastising slovenly argumentation in other courts, Brown observes that the record is “wholly devoid of evidence” supporting bans on the speech of tour guides Tonia Edwards and Bill Main, the stand-up persons who challenged the requirements.

The suit’s prospects may have been enhanced by the freedom-of-speech angle. But although the importance of the First Amendment cannot be overstated, violating it is only one of many ways that governments infringe on our right to engage in peaceful productive activity. The assaults seem endless. Too many people are too unwilling to mind their own business, too eager to interfere with yours. So we must be eternally vigilant.

By “we” I largely mean — with respect to this case and thousands like it — the folks at Institute for Justice, who came to the aid of Edwards and Main, and who incessantly champion the rights of people seeking only to peaceably earn their bread.

This is Common Sense. I’m Paul Jacob.

Big Business vs. Big Liberty

Monday, June 16th, 2014

“Incumbents Fear Cantor’s Loss Will Fill Tea Party’s Sails” is the headline.

Before a few days ago, GOP establishmentarians felt that they had finally quelled the Tea Party notion that Republicans should be more than 2 to 4 percent different from Democrats on whether the country should suffer a socialist health care industry, endless tsunamis of red ink, etc.

Coca-ColaCertain big businesses also hate Tea-Party-style boat-rocking. In his article “Big Business Vs. Libertarians in the GOP,” David Boaz observes that candidates who plausibly oppose crony capitalism are drawing opposition from firms like Coca Cola, Delta, Georgia Power, and AT&T. These and the Georgia Chamber of Commerce created a “Georgia Coalition for Job Growth” to defeat Republican Charles Gregory and other candidates who are “just too libertarian” for them.

What do these anti-liberty businesses — in Georgia, Kentucky, California and elsewhere — fear? The lower taxes that real-deal Tea Party candidates support?

No.

And it isn’t “gay marriage or foreign policy that seems to annoy big and politically connected businesses,” writes Boaz. Who they oppose are representatives who refuse to “bring home the bacon,” who “actually take seriously the limited government ideas that most Republicans only pay lip service to.”

Don’t be shocked to witness big businesses working against limited government, welcoming regulation and subsidy as a way of life.

Why? Because the “mixed economy” approach (whether mercantilist, “progressive,” fascist, what-have-you) allows them to rig the system in their favor, usually by discouraging competition.

This is Common Sense. I’m Paul Jacob.

The New Space Race

Thursday, June 12th, 2014

We’re on the verge of being virtually connected to every person in the whole world who has a $200 laptop or a $50 smartphone or better.

Private companies Google and Facebook are funneling capital into satellite networks to bring the Internet to millions now utterly without it. Reporters call their competition a “space race.” Google will spend between one and three billion dollars on 180 small low-earth-orbit satellites. Facebook’s game plan entails higher, geosynchronous orbits.satellites in orbit

Google estimates that “two thirds of the world have no [Internet] access at all. It’s why we’re so focused on new technologies … that [can] bring hundreds of millions more people online….”

Instapundit’s Glenn Reynolds thinks that Google’s satellites will also make governmental spying and censorship harder, a suggestion readers hotly dispute. In any case, major cyber-companies have been paying much more attention to plugging security holes in their systems in the wake of the Snowden revelations.

What’s indisputable is that dramatically more widespread Internet access will enable a great many people who currently lack that access to enjoy radical new means of knowledge and trade.

The Internet abets everything from communication to scholarship to publishing to broadcasting to stock trading to finding new customers and even new loves. This cyber wealth will be enriched by the contributions of the new surfers of the web. We can also expect the satellite technology backed by Google and Facebook to give us both higher Internet speeds and lower Internet costs.

Globalization is good.

This is Common Sense. I’m Paul Jacob.