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September 30, 2011

American Gangster as Destructive Entrepreneur




Denzel_Washington_American_Gangster2011-08-09.jpgSource of image: http://celebritywonder.ugo.com/wp/Denzel_Washington_in_American_Gangster_Wallpaper_12_1280.jpg



William Baumol famously categorized entrepreneurs as productive, unproductive, or destructive. (Somewhat similarly, Burt Folsom distinguished market entrepreneurs from political entrepreneurs.) Baumol's view is that we cannot much influence the supply of entrepreneurs, but good policies can increase the percent of entrepreneurs who are productive.

Frank Lucas, at least as portrayed in the 2007 film American Gangster, is an apt example of the destructive entrepreneur. As portrayed by Denzel Washington, the character is intense, willing to take risks, and works hards. There is a scene where Lucas argues that the quality of his product (cocaine) must not be adulterated, because his business depends on his customers knowing that his brand is better than that of competitors. He finds ways of making his supply chain shorter, and his distribution system more trustworthy (by hiring brothers and cousins).

One can easily imagine that with different incentives and constraints, the Denzel Washington character might have brought the world a product that made the world better, rather than worse.


The Baumol article mentioned is:

Baumol, William J. "Entrepreneurship: Productive, Unproductive, and Destructive." The Journal of Political Economy 98, no. 5, Part 1 (Oct. 1990): 893-921.


The Folsom book mentioned is:

Folsom, Burton W. The Myth of the Robber Barons. 4th ed: Young America's Foundation, 2003 (1st ed. 1987).





September 29, 2011

McKinsey Finds 30% of Employers Will Drop Health Coverage in Response to Obamacare




McKinsey is probably the best known business consulting and forecasting firm in the United States. Many well-known management gurus, and corporate executives, have spent time working for McKinsey (as did Chelsea Clinton). One of their senior partners (Foster) co-authored a useful book called Creative Destruction.


(p. A2) A report by McKinsey & Co. has found that 30% of employers are likely to stop offering workers health insurance after the bulk of the Obama administration's health overhaul takes effect in 2014.


. . .


Previous research has suggested the number of employers who opt to drop coverage altogether in 2014 would be minimal.

But the McKinsey study predicts a more dramatic shift from employer-sponsored health plans once the new marketplace takes effect. Starting in 2014, all but the smallest employers will be required to provide insurance or pay a fine, while most Americans will have to carry coverage or pay a different fine. Lower earners will get subsidies to help them pay for plans.

In surveying 1,300 employers earlier this year, McKinsey found that 30% said they would "definitely or probably" stop offering employer coverage in the years after 2014. That figure increased to more than 50% among employers with a high awareness of the overhaul law.



For the full story, see:

JANET ADAMY. "Study Sees Cuts to Health Plans." The Wall Street Journal (Weds., JUNE 8, 2011): A15.

(Note: ellipsis added.)


The Foster book is:

Foster, Richard N., and Sarah Kaplan. Creative Destruction: Why Companies That Are Built to Last Underperform the Market---and How to Successfully Transform Them. New York: Currency Books, 2001.






September 28, 2011

We Tend to Ignore Information that Contradicts Our Beliefs




BelievingBrainBK2011-08-09.jpg












Source of book image: online version of the WSJ review quoted and cited below.






We learn the most when our priors are contradicted. But the dissonance between evidence and beliefs is painful. So we often do not see, or soon forget, evidence that does not fit with our beliefs.

The innovative entrepreneur is often a person who sees and forces herself to remember, the dissonant fact, storing it away to make sense of, or make use of, later. At the start, she may be alone in what she sees and what she remembers. So if we are to benefit from her ability and willingness to bear the pain of dissonance, she must have the freedom to differ, and she must have the financial wherewith-all to support herself until her vision is more widely shared, better understood, and more fruitfully applied.


(p. A13) Beliefs come first; reasons second. That's the insightful message of "The Believing Brain," by Michael Shermer, the founder of Skeptic magazine. In the book, he brilliantly lays out what modern cognitive research has to tell us about his subject--namely, that our brains are "belief engines" that naturally "look for and find patterns" and then infuse them with meaning. These meaningful patterns form beliefs that shape our understanding of reality. Our brains tend to seek out information that confirms our beliefs, ignoring information that contradicts them. Mr. Shermer calls this "belief-dependent reality." The well-worn phrase "seeing is believing" has it backward: Our believing dictates what we're seeing.


. . .


One of the book's most enjoyable discussions concerns the politics of belief. Mr. Shermer takes an entertaining look at academic research claiming to prove that conservative beliefs largely result from psychopathologies. He drolly cites survey results showing that 80% of professors in the humanities and social sciences describe themselves as liberals. Could these findings about psychopathological conservative political beliefs possibly be the result of the researchers' confirmation bias?

As for his own political bias, Mr. Shermer says that he's "a fiscally conservative civil libertarian." He is a fan of old-style liberalism, as in liberality of outlook, and cites "The Science of Liberty" author Timothy Ferris's splendid formulation: "Liberalism and science are methods, not ideologies." The "scientific solution to the political problem of oppressive governments," Mr. Shermer says, "is the tried-and-true method of spreading liberal democracy and market capitalism through the open exchange of information, products, and services across porous economic borders."

But it is science itself that Mr. Shermer most heartily embraces. "The Believing Brain" ends with an engaging history of astronomy that illustrates how the scientific method developed as the only reliable way for us to discover true patterns and true agents at work. Seeing through a telescope, it seems, is believing of the best kind.



For the full review, see:

RONALD BAILEY. "A Trick Of the Mind; Looking for patterns in life and then infusing them with meaning, from alien intervention to federal conspiracy." The Wall Street Journal (Weds., July 27, 2011): A13.

(Note: ellipsis added.)


Book reviewed:

Shermer, Michael. The Believing Brain: From Ghosts and Gods to Politics and Conspiracies---How We Construct Beliefs and Reinforce Them as Truths. New York: Times Books, 2011.





September 27, 2011

Brits Sent Low Quality Goods to American Colonists





(p. 299) It was easy - and for many agents irresistibly tempting - to offload on to Americans clothes and furnishings that were unsold because they were no longer fashionable in England. 'You cannot really form an idea of the trash that is to be found in the best shops,' an English visitor named Margaret Hall wrote home to a friend. A cheerful catchphrase of English (p. 300) factories became: 'It's good enough for America.' Being over-charged was a constant suspicion. Washington wrote furiously to Cary after one consignment that many of the products supplied were 'mean in quality but not in price, for in this they excel indeed far above any I have ever had'.


Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 26, 2011

Solyndra Debacle Illustrates Why Feds Should Not Pick Tech Winners




The clip above is embedded from the Jon Stewart "The Daily Show" episode that was aired on Thurs., September 15, 2011.



Government "industrial policy" is likely to fail for many reasons. One is that the government decision makers are unlikely to know which future technologies will turn out to be the best ones. Another reason is that even if they know, government decision makers often decide based on what is politically expedient or what is beneficial to their friends.

Solyndra is a case in point, as Jon Stewart hilariously reveals.






September 25, 2011

Lunar Entrepreneurs




(p. A1) Now that the last space shuttle has landed back on Earth, a new generation of space entrepreneurs would like to whip up excitement about the prospect of returning to the Moon.


. . .


(p. A3) "It's probably the biggest wealth creation opportunity in modern history," said Barney Pell, a former NASA computer scientist turned entrepreneur and now a co-founder of Moon Express. While Moon Express might initially make money by sending small payloads, the big fortune would come from bringing back platinum and other rare metals, Dr. Pell said.

"Long term, the market is massive, no doubt," he said. "This is not a question of if. It's a question of who and when. We hope it's us and soon."

Like the aviation prizes that jump-started airplane technology a century ago, the Google Lunar X Prize is meant to rally technologists and entrepreneurs. It is administered by the X Prize Foundation, which handed out $10 million in 2004 to the first private team to build a spacecraft that could carry people 60 miles above the Earth's surface. (The winner, SpaceShipOne, was built by the aerospace designer Burt Rutan with backing from Paul Allen, the software magnate.)



For the full story, see:

KENNETH CHANG. "In a Private Race to the Moon, Flights of Fancy Are in the Air." The New York Times (Fri., July 22, 2011): A1 & A3.

(Note: the online version of the story is dated July 21, 2011 and has the title "Race to the Moon Heats Up for Private Firms.")





September 24, 2011

Chinese Boom Financed by Government Debt and "Clever Accounting"




EmptyLotForWuhanTower2011-08-08.jpg "An empty lot in Wuhan, China, where developers intend to build a tower taller than the Empire State Building in New York." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. A1) . . . the Wuhan Metro is only one piece of a $120 billion municipal master plan that includes two new airport terminals, a new financial district, a cultural district and a riverfront promenade with an office tower half again as high as the Empire State Building.


. . .


The plans for Wuhan, a provincial capital about 425 miles west of Shanghai, might seem extravagant. But they are not unusual. Dozens of other Chinese cities are racing to complete infrastructure projects just as expensive and ambitious, or more (p. A8) so, as they play their roles in this nation's celebrated economic miracle.

In the last few years, cities' efforts have helped government infrastructure and real estate spending surpass foreign trade as the biggest contributor to China's growth. Subways and skyscrapers, in other words, are replacing exports of furniture and iPhones as the symbols of this nation's prowess.

But there are growing signs that China's long-running economic boom could be undermined by these building binges, which are financed through heavy borrowing by local governments and clever accounting that masks the true size of the debt.

The danger, experts say, is that China's municipal governments could already be sitting on huge mountains of hidden debt -- a lurking liability that threatens to stunt the nation's economic growth for years or even decades to come. Just last week China's national auditor, who reports to the cabinet, warned of the perils of local government borrowing. And on Tuesday the Beijing office of Moody's Investors Service issued a report saying the national auditor might have understated Chinese banks' actual risks from loans to local governments.

Because Chinese growth has been one of the few steady engines in the global economy in recent years, any significant slowdown in this country would have international repercussions.



For the full story, see:

DAVID BARBOZA. "Building Boom in China Stirs Fears of Debt Overload." The New York Times (Thurs., July 7, 2011): C8.

(Note: online version of the article is dated July 6, 2011 and has the title "Building Boom in China Stirs Fears of Debt Overload.")

(Note: ellipses added.)





September 23, 2011

Navigation Acts, Were "Insanely Inefficient, but Gratifyingly Lucrative to British Merchants and Manufacturers"





(p. 297) Many of Monticello's quirks spring from the limitations of Jefferson's workmen. He had to stick to a simple Doric style for the exterior columns because he could find no one with the skills to handle anything more complex. But the greatest problem of all, in terms of both expense and frustration, was a lack of home-grown materials. It is worth taking a minute to consider what the American colonists were up against in trying to build a civilization in a land without infrastructure.

(p. 298) Britain's philosophy of empire was that America should provide it with raw materials at a fair price and take finished products in return. The system was enshrined in a series of laws known as the Navigation Acts, which stipulated that any product bound for the New World had either to originate in Britain or pass through it on the way there, even if it had been created in, say, the West Indies, and ended up making a pointless double crossing of the Atlantic. The arrangement was insanely inefficient, but gratifyingly lucrative to British merchants and manufacturers, who essentially had a fast-growing continent at their commercial mercy. By the eve of the revolution America effectively was Britain's export market. It took 80 per cent of British linen exports, 76 per cent of exported nails, 60 per cent of wrought iron and nearly half of all the glass sold abroad. In bulk terms, America annually imported 30,000 pounds of silk, 11,000 pounds of salt and over 130,000 beaver hats, among much else. Many of these things - not least the beaver hats - were made from materials that originated in America in the first place and could easily have been manufactured in American factories - a point that did not escape the Americans.



Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 22, 2011

Deregulation Revived Railroads




RailroadMogulsCartoon2011-08-08.jpg
















"ALL ABOARD: The Wasp magazine in 1881 lampooned railroad moguls as having regulators in the palms of their hands." Source of caricature: online version of the WSJ article quoted and cited below.




(p. C8) Mr. Klein has written thoroughly researched and scrupulously objective biographies of the previously much maligned Jay Gould and E.H. Harriman, remaking their public images by presenting them in full. Now he has published the third and final volume of his magisterial history of the Union Pacific railroad, taking the company from 1969 to the present day.

Union Pacific--the only one of the transcontinentals to remain in business under its original name--is now a flourishing business. Thanks to a series of mergers, it is one of the largest railroads in the world, with more than 37,000 miles of track across most of the American West. Thanks to its investment in new technology, it is also among the most efficient.

In 1969, though, the future of American railroading was in doubt as the industry struggled against competition from airplanes, automobiles and trucks--all of which were in effect heavily subsidized through the government's support for airports and the Interstate Highway System.

Another major factor in the decline of the railroads had been the stultifying hand of the Interstate Commerce Commission. The ICC had come into existence in the late 19th century to limit the often high-handed ways of the railroads as they wrestled with the difficult economics of an industry that has very high fixed costs. ( . . . .) But the ICC soon evolved into a cartel mechanism that discouraged innovation and wrapped the railroad industry in a cocoon of stultifying rules.

Mr. Klein notes that in 1975 he wrote a gloomy article about the sad state of an industry with a colorful past: "Unlike many other historical romances," he wrote back then, "the ending did not promise to be a happy one."

Fortunately, a deregulation movement that began under the Carter administration--yes, the Carter administration--limited the power of the ICC and then abolished it altogether. As Mr. Klein shows in the well-written "Union Pacific," the reduction of government interference left capitalism to work its magic and produce--with the help of dedicated and skillful management--the modern, efficient and profitable railroad that is the Union Pacific.



For the full review, see:

JOHN STEELE GORDON. "Tracks Across America." The Wall Street Journal (Sat., JUNE 11, 2011): C8.

(Note: ellipsis added.)


Book reviewed in the part of the review quoted above:

Klein, Maury. Union Pacific: The Reconfiguration: America's Greatest Railroad from 1969 to the Present. New York: Oxford University Press, USA, 2011.






September 21, 2011

Coralville Police Close 4-Year-Old Abigail's Lemonade Stand




(p. 2B) CORALVILLE -- Police closed down a lemonade stand in Coralville, telling its 4-year-old operator and her dad that she didn't have a permit.


. . .


Abigail's dad, Dustin Krutsinger, said the ordinance and its enforcers are going too far if they force a 4-year-old to abandon her lemonade stand.



For the full story, see:

AP. "Coralville shuts down girl's lemonade stand." Omaha World-Herald [Iowa Edition] (Weds., August 3, 2011): 2B.

(Note: ellipsis added.)

(Note: the online version of the article is dated August 2, 2011 and has the title "Girl's lemonade stand shut down.")



The next day, the Iowa Edition of the Omaha World-Herald ran an update:


(p. 2B) CORALVILLE -- Four-year-old Abigail Krutsinger wasn't the only lemonade stand operator who was closed down when RAGBRAI bicyclists poured into Coralville last week.

At least three stands run by children were closed down because they hadn't obtained permits and health inspections.



For the full story, see:

AP. "Coralville defends closing kids' stands." Omaha World-Herald [Iowa Edition] (Thurs., August 4, 2011): 2B.

(Note: the online version of the article is dated August 3, 2011, and has the title "More lemonade stands shuttered.")






September 20, 2011

"Mystified by an American Disdain for Its Own Business Culture"




HollandAndDavisProducersSomethingVentured2011-05-17.jpg "Paul Holland and Molly Davis, producers of a new documentary, "Something Ventured," that gives an admiring look at innovators and investors from the past." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. B3) The film, "Something Ventured," is a frankly admiring look at those who went out on a limb to back upstarts like Atari, Cisco Systems, Genentech and Apple.


. . .


But the film's beating heart is captured by Tom Perkins, whose Kleiner Perkins Caufield & Byers company backed the gene-splicing technology of Genentech, among other things. "It's great if you can make money and change the world for the better at the same time," said Mr. Perkins, . . .

Other stars of "Something Ventured" include Nolan Bushnell of Atari; Sandy Lerner of Cisco; Jimmy Treybig of Tandem Computers; and a string of venture capitalists, among them Don Valentine, Dick Kramlich, and Arthur Rock.

Many who appear joined dozens of other business people to finance the picture's roughly $700,000 cost with contributions of a few thousand dollars each, Mr. Holland said.

In becoming involved, several participants said they wanted to rekindle an entrepreneurial spirit that had either waned or changed since the rough-and-tumble years when, by the film's telling, Atari was started with $250 but needed capital to push Pong, and Mr. Bushnell passed up a chance to own a third of Apple, started by his employee Steve Jobs, for $50,000.


. . .


Mr. Valentine, . . . , said entrepreneurship had not ended -- his company was a force behind Google -- but it is less often coming from those born in the United States.

"You don't understand what you have here" is a constant refrain, he said, from Southeast Asian and Indian innovators who are sometimes mystified by an American disdain for its own business culture.



For the full story, see:

MICHAEL CIEPLY . "A Film About Capitalism, and (Surprise) It's a Love Story." The New York Times, Week in Review Section (Sun., March 8, 2011): 8.

(Note: ellipses added.)

(Note: the online version of the story is dated March 7, 2011.)





September 19, 2011

John Crandon Proved Scurvy Caused by Lack of Vitamin C





(p. 167) . . . , in 1939 a Harvard Medical School surgeon named John Crandon decided to settle matters once and for all by the age-old method of withholding Vitamin C from his diet for as long as it took to make himself really ill. It took a surprisingly long time. For the first eighteen weeks, his only symptom was extreme fatigue. (Remarkably, he continued to operate on patients throughout this period.) But in the nineteenth week he took an abrupt turn for the worse - so much so that he would almost certainly have died had he not been under close medical supervision. He was injected with 1,000 milligrams of Vitamin C and was restored to life (p. 168) almost at once. Interestingly, he had never acquired the one set of symptoms that everyone associates with scurvy: the falling out of teeth and bleeding of gums.


Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.

(Note: ellipsis added.)





September 18, 2011

"Unless the Federal Government Takes It All Away"




BoeingSouthCarolinaPlant2011-08-08.jpg "Wayne Gravot, right, and Jeff Sparwasser at the new plant in North Charleston, S.C." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. A1) NORTH CHARLESTON, S.C. -- Boeing's gigantic new $750 million airplane factory here is the pride of South Carolina, the biggest single investment ever made in a state that is far more associated with old-line textile mills than state-of-the-art manufacturing. In just a few weeks, 1,000 workers will begin assembling the first of what they hope will be hundreds of 787 Dreamliners.

That is, unless the federal government takes it all away.

In a case that has enraged South Carolinians and become a cause célèbre among Republican lawmakers and presidential hopefuls, the National Labor Relations Board has accused Boeing of illegally setting up shop in South Carolina because of past strikes by the unionized workers at its main manufacturing base in the Seattle area. The board is asking a judge to order Boeing to move the Dreamliner production -- and the associated jobs -- to Washington State.



For the full story, see:

STEVEN GREENHOUSE. "Boeing Labor Dispute Is Making New Factory a Political Football." The New York Times (Fri., July 1, 2011): A10.

(Note: ellipsis added.)

(Note: the online version of the story is dated June 30, 2011.)







September 17, 2011

Study Finds No Link Between Cellphones and Cancer




(p. A3) A European study involving nearly 1,000 participants has found no link between cellular-phone use and brain tumors in children and adolescents, a group that may be particularly sensitive to phone emissions.

The study, published in the Journal of the National Cancer Institute, was prompted by concerns that the brains of younger users may be more vulnerable to adverse health effects--such as cancer--from cellphones.



For the full story, see:

GAUTAM NAIK. "Study Sees No Cellphone-Cancer Ties." The Wall Street Journal (Thurs., July 28, 2011): A3.






September 16, 2011

Art Diamond Describes Honors Colloquium on Creative Destruction








The clip above is embedded from You Tube. It was recorded on July 6, 2011 in Mammel Hall, the location of the College of Business at the University of Nebraska at Omaha (UNO). I am grateful to Charley Reed of UNO University Relations for doing a great job of shooting and editing the clip.





September 15, 2011

Obstacles to Curing Scurvy: A Deadly Experiment and Putting Theory Before Evidence





(p. 165) What was needed was some kind of distilled essence - an antiscorbutic, as the medical men termed it - that would be effective against scurvy but portable too. In the 1760s, a Scottish doctor named William Stark, evidently encouraged by Benjamin Franklin, conducted a series of patently foolhardy experiments in which he tried (p. 166) to identify the active agent by, somewhat bizarrely, depriving himself of it. For weeks he lived on only the most basic of foods - bread and water chiefly - to see what would happen. What happened was that in just over six months he killed himself, from scurvy, without coming to any helpful conclusions at all.

In roughly the same period, James Lind, a naval surgeon, conducted a more scientifically rigorous (and personally less risky) experiment by finding twelve sailors who had scurvy already, dividing them into pairs, and giving each pair a different putative elixir - vinegar to one, garlic and mustard to another, oranges and lemons to a third, and so on. Five of the groups showed no improvement, but the pair given oranges and lemons made a swift and total recovery. Amazingly, Lind decided to ignore the significance of the result and doggedly stuck with his personal belief that scurvy was caused by incompletely digested food building up toxins within the body.



Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 14, 2011

Arrested for Feeding Homeless Without a Permit




ArrestFeedingWithoutPermit2011-08-08.jpg "Volunteers from Food Not Bombs were arrested at Lake Eola Park in Orlando, Fla., last month after feeding homeless people without a permit." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. A10) MIAMI -- The hacker group Anonymous has declared a cyberwar against the City of Orlando, disabling Web sites for the city's leading redevelopment organization, the local Fraternal Order of Police and the mayor's re-election campaign.


. . .


The group described its attacks as punishment for the city's recent practice of arresting members of Orlando Food Not Bombs, an antipoverty group that provides vegan and vegetarian meals twice a week to homeless people in one of the city's largest parks.

"Anonymous believes that people have the right to organize, that people have the right to give to the less fortunate and that people have the right to commit acts of kindness and compassion," the group's members said in a news release and video posted on YouTube on Thursday. "However, it appears the police and your lawmakers of Orlando do not."

A 2006 city ordinance requires organizations to obtain permits to feed groups of 25 people or more in downtown parks. The law was passed after numerous complaints by residents and businesses owners about the twice-weekly feedings in Lake Eola Park, city officials said. The law limits any group to no more than two permits per year per park.

Since June 1, the city police have arrested 25 Orlando Food Not Bombs volunteers without permits as they provided meals to large groups of homeless people in the park. One of those arrested last week on trespassing charges was Keith McHenry, a co-founder of the first Food Not Bombs chapter in 1980 in Cambridge, Mass. He remained in the Orange County Jail on Thursday awaiting a bond hearing.



For the full story, see:

DON VAN NATTA Jr. "Citing Homeless Law, Hackers Turn Sights on Orlando." The New York Times, SundayBusiness Section (Fri., July 1, 2011): A10.

(Note: ellipsis added.)

(Note: the online version of the story is dated June 30, 2011.)



McHenryKeithCofounder2011-08-08.jpg "Keith McHenry, a co-founder of the first Food Not Bombs group, serving food at the park in May. He was in jail Thursday." Source of caption and photo: online version of the NYT article quoted and cited above.





September 13, 2011

Chinese Emphasis on Rote Learning Produces Passive Researchers




(p. A15) Hardly a week goes by without a headline pronouncing that China is about to overtake the U.S. and other advanced economies in the innovation game. Patent filings are up, China is exporting high-tech goods, the West is doomed. Or so goes the story line. The reality is very different.


. . .


But more than 95% of the Chinese applications were filed domestically with the State Intellectual Property Office--and the vast majority cover "innovations" that make only tiny changes on existing designs. A better measure is to look at innovations that are recognized outside China--at patent filings or grants to China-origin inventions by the world's leading patent offices, the U.S., the EU and Japan. On this score, China is way behind.


. . .


China's educational system is another serious challenge because it emphasizes rote learning rather than creative problem solving. When Microsoft opened its second-largest research lab (after Redmond, Wash.) in Beijing, it realized that while the graduates it hired were brilliant, they were too passive when it came to research inquiry.

The research directors attacked this problem by effectively requiring each new hire to come up with a project he or she wanted to work on. Microsoft's approach is more the exception than the rule among R&D labs in China, which tend to be more top-down.



For the full commentary, see:

ANIL K. GUPTA AND HAIYAN WANG. "Chinese Innovation Is a Paper Tiger; A closer look at China's patent filings and R&D spending reveals a country that has a long way to go." The Wall Street Journal (Thurs., July 28, 2011): A15.

(Note: ellipses added.)






September 12, 2011

From Inventor to Entrepreneur When No Company Would Distribute Weed Eater




BallasGeorgeWeedEaterInventer2011-08-08.jpg "George Ballas showed off in 1975 the original Weed Eater, a popcorn can rigged up with some wires." Source of caption and photo: online version of the WSJ obituary quoted and cited below.


(p. A5) George Ballas got his big idea after a poisonous snake bit a worker who was trimming his lawn with shears. The idea turned an old popcorn can, some wires and an edger into the Weed Eater.

Mr. Ballas, who died Saturday at age 85, was a dance instructor, developer, inventor and marketer who built hotels, patented an adjustable table and marketed an early portable phone.


. . .


Mr. Ballas said the idea for the Weed Eater came to him while he was in a car wash, contemplating the big rotating bristles that cleaned hard-to-reach corners yet somehow didn't scratch the finish.

Drawing from that inspiration, he rigged up an old popcorn can with some wires and hooked it to a rotating edger, and the first string trimmer was born.


. . .


He hired an engineer to design new models that substituted monofilament fishing line for wire and ran on electricity and gas. He dubbed it "Weed Eater" and held several patents on it.

When Mr. Ballas failed to find a company interested in distributing the device, he decided to sell it himself.


. . .


Mr. Ballas also taught entrepreneurship at Rice University in Houston. He continued to tinker with new inventions, and at one point marketed a football-helmet-sized portable phone that found few takers.

"A Weed Eater," Mr. Ballas told the Houston Chronicle in 1993, "comes along once in a lifetime."



For the full obituary, see:

STEPHEN MILLER. "REMEMBRANCES; Dance Studio Owner Invented Weed Eater." The Wall Street Journal (Thurs., JUNE 30, 2011): A5.

(Note: ellipses added.)





September 11, 2011

"Comfort" at Home Was Unfamiliar Before 1770





(p. 135) If you had to summarize it in a sentence, you could say that the history of private life is a history of getting comfortable slowly. Until the eighteenth century the idea of having comfort at home was so unfamiliar that there wasn't even a word for the condition. 'Comfortable' meant merely 'capable of being consoled'. Comfort was something you gave to the wounded or distressed. The first person to use the word in its modern sense was the writer Horace Walpole, who remarked in a letter to a friend in 1770 that a certain Mrs White was looking after him well and making him 'as comfortable as is possible'. By the early nineteenth century, everyone was talking about having a comfortable home or enjoying a comfortable living, but before Walpole's day no one did.


Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 10, 2011

The Anecdote for Malignant Perfectionism: "I'll Fix that in My Next Piece"




MoreauWellesChimesAtMidnight2011-08-08.jpg"Jeanne Moreau and Orson Welles in 'Chimes at Midnight,' a 1965 Shakespeare-based film that's recently been restored." Source of caption and photo: online version of the WSJ article quoted and cited below.


(p. D8) Every great artist, . . . , strives for perfection. In fact, that's part of what makes them great: They're never entirely satisfied with anything that they do. The classical pianist Artur Schnabel once remarked that he was only interested in performing music that was "better than it can be performed...unless a piece of music presents a problem to me, a never-ending problem, it doesn't interest me too much." This sums up the plight of all serious artists: They lead lives of endless frustration, struggling to reach the top of the hill, then seeing another, higher hill just beyond it.


. . .


Alas, that kind of suffering goes with the territory. The trick, as every artist knows, is not to let it interfere with getting things done. The wisest artists are the ones who finish a new work, walk away and move on to the next project. Whenever a colleague pointed out a "mistake" in one of Dmitri Shostakovich's compositions, he invariably responded, "Oh, I'll fix that in my next piece."

The road to malignant perfectionism, by contrast, starts with chronic indecision. Jerome Robbins, whose inability to make up his mind was legendary throughout the world of dance, was known for choreographing multiple versions of a variation, then waiting until the last possible minute to decide which one to use. Beyond a certain point, this kind of perfectionism is all but impossible to distinguish from unprofessionalism, and Mr. Welles reached that point early in his career. . . .


. . .


Mr. Welles's problem was that he wanted it both ways. He was a perfectionist who expected his collaborators to sit around endlessly waiting for him to make up his mind--and to pay for all the overtime that he ran up along the way. Simon Callow, his biographer, has summed up this failing in one devastating sentence: "Any form of limitation, obligation, responsibility or enforced duty was intolerable to him, rendering him claustrophobic and destructive." That's the wrong kind of perfectionism, and it led, as it usually does, to disaster.



For the full commentary, see:

TERRY TEACHOUT. "The Snare of Perfectionism: When Artists Aim Too High." The Wall Street Journal (Fri., July 22, 2011): D8.

(Note: ellipsis in Schnabel quote was in original; other ellipses added.)





September 9, 2011

Occupational Licensing Reduces Job Creation




(p. A15) Only one in 20 workers needed the government's permission to pursue their chosen occupation in the 1950s, notes University of Minnesota Prof. Morris Kleiner. Today that figure is nearly one in three.


. . .


The breadth of jobs is remarkable. Travel and tourist guides, funeral attendants, home-entertainment installers, florists, makeup artists, even interpreters for the deaf are all regulated by various states. Want to work as an alarm installer? In 35 states, you will need to earn the government's permission. Are you skilled in handling animals? You will need more than that skill in the 20 states that require a license for animal training.

There's usually more to these licenses than filling out some paperwork and paying a small fee. Most come with government-dictated educational requirements, examinations, minimum age and grade levels, and other hurdles.


. . .


Instead of looking to the federal government to create jobs, state legislatures could have a real and immediate effect on unemployment in their states by showing how less truly is more. They can remove the barriers to job creation that their predecessors erected and enjoy the job-generating drive of their states' aspiring entrepreneurs.



For the full commentary, see:

CHIP MELLOR And DICK CARPENTER. "Want Jobs? Cut Local Regulations." The Wall Street Journal (Thurs., July 28, 2011): A15.

(Note: ellipses added.)






September 8, 2011

Arthur Murray "America's First Space Pilot," RIP




MurrayArthurFirstSpacePilot2011-08-06.jpg








"Maj. Arthur Murray in 1954." Source of caption and photo: online version of the NYT article quoted and cited below.










(p. A18) "I begin to feel weightless, and I'm flying so fast my instruments can't keep up -- they show what happened two miles ago. I'm climbing so steeply I can't see the ground, and I feel confused. I have a sense of falling and I want to grab something for support."

It was May 28, 1954, and Maj. Arthur Murray, test pilot, would wrestle for the next 15 terrifying seconds with a rocket plane racing over 1,400 miles an hour and spinning wildly, supersonically out of control. In the turmoil, he would fly higher than any human being had ever been, 90,440 feet over the earth.

Finally, Major Murray's plane, a Bell X-1A, sank back into heavier air, and he had time to look at the dark blue sky and dazzling sunlight. He became the first human to see the curvature of the earth. At the time, he was called America's first space pilot.

Arthur Murray, known as Kit, died on July 25, in a nursing home in the town of West in Texas, his family said. He was 92. He requested that his ashes be scattered over the Mojave Desert, where some of his fellow test pilots crashed and died.

Tom Wolfe marveled at the test pilots of Edwards Air Force Base in his 1979 book "The Right Stuff" exclaiming, "My God -- to be part of Edwards in the late forties and early fifties!"



For the full obituary, see:

DOUGLAS MARTIN. "Arthur Murray, Test Pilot, Is Dead at 92." The New York Times (Fri., August 5, 2011): A18.

(Note: the online version of the story is dated August 4, 2011.)


The wonderful Tom Wolfe book mentioned is:

Wolfe, Tom. The Right Stuff. New York: Farrar, Straus & Giroux, Inc., 1979.





September 7, 2011

At First, Some Feared Electricity





(p. 133) Something of the prevailing ambivalence was demonstrated by Mrs Cornelius Vanderbilt, who went to a costume ball dressed as an electric light to celebrate the installation of electricity in her Fifth Avenue home in New York, but then had the whole system taken out when it was suspected of being the source of a small fire. Others detected more insidious threats. One authority named S. F. Murphy identified a whole host of electrically induced maladies - eyestrain, headaches, general unhealthiness and possibly even 'the premature exhaustion of life'. One architect was certain electric light caused freckles.


Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 6, 2011

The Movie Auteur as a Model for Technology Entrepreneurship




AuteurVersusCommittee2011-08-07.jpg Source of image: online version of the NYT article quoted and cited below.



(p. 3) Two years ago, the technology blogger John Gruber presented a talk, "The Auteur Theory of Design," at the Macworld Expo. Mr. Gruber suggested how filmmaking could be a helpful model in guiding creative collaboration in other realms, like software.

The auteur, a film director who both has a distinctive vision for a work and exercises creative control, works with many other creative people. "What the director is doing, nonstop, from the beginning of signing on until the movie is done, is making decisions," Mr. Gruber said. "And just simply making decisions, one after another, can be a form of art."

"The quality of any collaborative creative endeavor tends to approach the level of taste of whoever is in charge," Mr. Gruber pointed out.

Two years after he outlined his theory, it is still a touchstone in design circles for discussing Apple and its rivals.

Garry Tan, designer in residence and a venture partner at Y Combinator, an investor in start-ups, says: "Steve Jobs is not always right--MobileMe would be an example. But we do know that all major design decisions have to pass his muster. That is what an auteur does."

Mr. Jobs has acquired a reputation as a great designer, Mr. Tan says, not because he personally makes the designs but because "he's got the eye." He has also hired classically trained designers like Jonathan Ive. "Design excellence also attracts design talent," Mr. Tan explains.



For the full story, see:

RANDALL STROSS. "DIGITAL DOMAIN; The Auteur vs. the Committee." The New York Times, SundayBusiness Section (Sun., July 24, 2011): 3.

(Note: the online version of the story is dated July 23, 2011.)





September 5, 2011

"Credentialing Gone Amok---In 20 Years, You'll Need a Ph.D. to Be a Janitor"




(p. 17) Call it credential inflation. Once derided as the consolation prize for failing to finish a Ph.D. or just a way to kill time waiting out economic downturns, the master's is now the fastest-growing degree.


. . .


"There is definitely some devaluing of the college degree going on," says Eric A. Hanushek, an education economist at the Hoover Institution, and that gives the master's extra signaling power. "We are going deeper into the pool of high school graduates for college attendance," making a bachelor's no longer an adequate screening measure of achievement for employers.

Colleges are turning out more graduates than the market can bear, and a master's is essential for job seekers to stand out -- that, or a diploma from an elite undergraduate college, says Richard K. Vedder, professor of economics at Ohio University and director of the Center for College Affordability and Productivity.

Not only are we developing "the overeducated American," he says, but the cost is borne by the students getting those degrees. "The beneficiaries are the colleges and the employers," he says. Employers get employees with more training (that they don't pay for), and universities fill seats. In his own department, he says, a master's in financial economics can be a "cash cow" because it draws on existing faculty ("we give them a little extra money to do an overload") and they charge higher tuition than for undergraduate work. "We have incentives to want to do this," he says. He calls the proliferation of master's degrees evidence of "credentialing gone amok." He says, "In 20 years, you'll need a Ph.D. to be a janitor."



For the full story, see:

LAURA PAPPANO. "The Master's as the New Bachelor's." The New York Times, EducationLife Section (Sun., July 24, 2011): 16-17.

(Note: ellipsis added.)

(Note: the online version of the story is dated July 22, 2011.)





September 4, 2011

Political Ideology Matters in Hiring and Tenure




compromising-scholarship-religious-and-political-bias-in-american-higher-educationBK.jpg
















Source of book image:
http://images.borders.com.au/images/bau/97816025/9781602582682/0/0/plain/compromising-scholarship-religious-and-political-bias-in-american-higher-education.jpg




(p. 34) . . . when a faculty committee is looking to hire or award tenure, political ideology seems to make a difference, according to a "collegiality survey" conducted by George Yancey.

Dr. Yancey, a professor of sociology at the University of North Texas, asked more than 400 sociologists which nonacademic factors might influence their willingness to vote for hiring a new colleague. You might expect professors to at least claim to be immune to bias in academic hiring decisions.

But as Dr. Yancey reports in his new book, "Compromising Scholarship: Religious and Political Bias in American Higher Education," more than a quarter of the sociologists said they would be swayed favorably toward a Democrat or an A.C.L.U. member and unfavorably toward a Republican. About 40 percent said they would be less inclined to vote for hiring someone who belonged to the National Rifle Association or who was an evangelical. Similar results were obtained in a subsequent survey of professors in other social sciences and the humanities.



For the full commentary, see:

LAURA PAPPANO. "The Master's as the New Bachelor's." The New York Times, EducationLife Section (Sun., July 24, 2011): 34.

(Note: ellipsis added.)

(Note: the online version of the commentary is dated July 22, 2011.)


Book mentioned:

Yancey, George. Compromising Scholarship; Religious and Political Bias in American Higher Education. Waco, TX: Baylor University Press, 2011.






September 3, 2011

Edison Excelled as an Organizer of Systems





(p. 131) Where Edison truly excelled was as an organizer of systems. The invention of the light bulb was a wondrous thing but of not much practical use when no one had a socket to plug it into. Edison and his tireless workers had to design and build the entire system from scratch, from power stations to cheap and reliable wiring, to lampstands and switches. Within months Edison had set up no fewer than 334 small electrical plants all over the world; (p. 132) within a year or so his plants were powering thirteen thousand light bulbs. Cannily he put them in places where they would be sure to make maximum impact: on the New York Stock Exchange, in the Palmer House Hotel in Chicago, La Scala opera house in Milan, the dining room of the House of Commons in London. Swan, meanwhile, was still doing much of his manufacturing in his own home. He didn't, in short, have a lot of vision. Indeed, he didn't even file for a patent. Edison took out patents everywhere, including in Britain in November 1879, and so secured his preeminence.


Source:

Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.





September 2, 2011

China's "Orwellian Surveillance System"




BeijingWebCafe2011-08-07.jpg "A customer in a Beijing cafe not yet affected by new regulations surfed the Web on Monday." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. A4) BEIJING -- New regulations that require bars, restaurants, hotels and bookstores to install costly Web monitoring software are prompting many businesses to cut Internet access and sending a chill through the capital's game-playing, Web-grazing literati who have come to expect free Wi-Fi with their lattes and green tea.

The software, which costs businesses about $3,100, provides public security officials the identities of those logging on to the wireless service of a restaurant, cafe or private school and monitors their Web activity. Those who ignore the regulation and provide unfettered access face a $2,300 fine and the possible revocation of their business license.


. . .


The new measures, it would appear, are designed to eliminate a loophole in "Internet management" as it is called, one that has allowed laptop- and iPad-owning college students and expatriates, as well as the hip and the underemployed, to while away their days at cafes and lounges surfing the Web in relative anonymity. It is this demographic that has been at the forefront of the microblogging juggernaut, one that has revolutionized how Chinese exchange information in ways that occasionally frighten officials.


. . .


One bookstore owner said she had already disconnected the shop's free Wi-Fi, and not for monetary reasons. "I refuse to be part of an Orwellian surveillance system that forces my customers to disclose their identity to a government that wants to monitor how they use the Internet," said the woman, who feared that disclosing her name or that of her shop would bring unwanted attention from the authorities.



For the full story, see:

ANDREW JACOBS. "China Steps Up Web Monitoring, Driving Many Wi-Fi Users Away." The New York Times (Tues., July 26, 2011): A4.

(Note: ellipses added.)

(Note: the online version of the story is dated July 25, 2011.)





September 1, 2011

Natural Causes of Rapid Temperature Change




(p. C4) Some three decades after Laki, 1816 was known as the "year without a summer" thanks to a big eruption in Indonesia. Even Mount Pinatubo in the Philippines in 1991 caused a brief, though small, drop in world temperatures.

Other abrupt coolings have been bigger but less explicable. Earlier this year, two scientists from Brown University used lake sediments to conclude that the sharp cooling in Greenland during the late Middle Ages, which extinguished the Norse colonies, saw temperatures drop by seven degrees Fahrenheit in 80 years, much faster than recent warming there. Conversely, Greenland's temperature shot up by around 13 degrees in 50 years as the world came out of the last ice age 12,000 years ago and the ice sheets of North America and northern Europe retreated--again, unlike today's slow increase.



For the full commentary, see:

MATT RIDLEY. "MIND & MATTER; Will Volcanoes Cool Our Warming Earth?" The Wall Street Journal (Sat., AUGUST 6, 2011): C4.






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