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May 31, 2015

Justice Kagan Cites Dr. Seuss to Show Fish Are Tangible

(p. A16) In dissent, Justice Elena Kagan wrote that the real issue in the case, Yates v. United States, No. 13-7451, was that the law is too harsh. It is, she wrote, "too broad and undifferentiated, with too-high maximum penalties, which give prosecutors too much leverage and sentencers too much discretion."

She added, "And I'd go further: In those ways," the law "is unfortunately not an outlier, but an emblem of a deeper pathology in the federal criminal code."

Still, she said, "this court does not get to rewrite the law." She said it was "broad but clear."

"A fish is, of course, a discrete thing that possesses physical form," Justice Kagan wrote, citing as authority the Dr. Seuss classic "One Fish Two Fish Red Fish Blue Fish."

It does not matter, she said, that what Mr. Yates destroyed was not a document.

"A person who hides a murder victim's body is no less culpable than one who burns the victim's diary," she wrote. "A fisherman, like John Yates, who dumps undersized fish to avoid a fine is no less blameworthy than one who shreds his vessel's catch log for the same reason."

Justices Antonin Scalia, Anthony M. Kennedy and Clarence Thomas joined Justice Kagan's dissenting opinion.

For the full story, see:

ADAM LIPTAK. "In Overturning Conviction, Supreme Court Says Fish Are Not Always Tangible." The New York Times (Thurs., FEB. 26, 2015): A16.

(Note: the online version of the review has the date FEB. 25, 2015.)

The book discussed above is:

Seuss, Dr. One Fish Two Fish Red Fish Blue Fish. New York: Random House, 1960.

May 30, 2015

Skill Differences Cause Four Times Inequality as Wealth Concentration

(p. A25) "What I find destructive," says David Autor of the Massachusetts Institute of Technology, "is the message that if you don't get into the top 1 percent then you're out of the game. That's deeply, deeply incorrect."

Autor's own research shows that skills differences are four times more important than concentration of wealth in driving inequality. If we could magically confiscate and redistribute the above-average income gains that have gone to the top 1 percent since 1979, that would produce $7,000 more per household per year for the bottom 99 percent. But if we could close the gap so that high-school-educated people had the skills of college-educated people, that would increase household income by $28,000 per year.

For the full commentary, see:

David Brooks. "The Temptation of Hillary." The New York Times (Fri., MARCH 6, 2015): A25.

May 29, 2015

Studebaker Competed with "Unique Designs and Powerful Engines"


"Greg Lange, 53, with his two-tone 1955 Studebaker President, near his home in Edmonds, Wash." Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. D4) I've always rooted for underdogs.

. . .

Studebaker wasn't a big Detroit corporation. It was a smaller company out of South Bend, Ind., and had to be highly imaginative to compete with Ford and General Motors. This resulted in unique designs and powerful engines. The one in my President is called a Passmaster (a 259 cubic inch V8); the meaning is obvious.

For the full interview, see:

Greg Lange as told to interviewer A.J. BAIME. "Studebaker: President Still in Office." The Wall Street Journal (Weds., April 8, 2015): D4.

(Note: ellipsis added.)

(Note: the online version of the interview has the date April 7, 2015, and has the title "Studebaker: Still Stands Out After 60 Years." Where the online version differs from the print version, the quoted passage follows the online version.)

May 28, 2015

Ed Telling Centralized as He Talked of Decentralization

(p. 491) Like de Gaulle, Telling talked of decentralization as he centralized all things beneath him. He pulled the authority of individual stores into the purview of the retail groups, then the power of the groups into the territory, and then the awesome power of the territories up into the Tower--with an assist to Ed Brennan at the end. The killing off of layers of management in many large companies causes the authority to fall down as if by gravity, but Telling pulled it back up manually. Every retirement caused former authority to come up to him.


Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

May 27, 2015

Books that Paved Way to Darwinian Evolution

(p. C6) "Visions of Science" is, as Mr. Secord acknowledges, "a book about books." We learn more about typeface size, bindery material, print runs and sales figures of the books than about the authors. We would not glean from this account, for example, how intertwined their lives were: They attended the same parties, discussed science together and reviewed one another's works. Taken together, the books Mr. Secord features tell a fascinating story, and they paved the way to another that is not featured in Mr. Secord's account but hovers over the others like Davy's spirit guide.

In "Origin of Species" (1859), Charles Darwin took the central ideas in these books--that there is a connection between the sciences, that the Earth is much older than previously thought, that God created the world to work by uniform natural law, and that He built lawful change into his original creation--and used them to frame his theory of evolution by natural selection in terms his readers could accept. The success of Darwin--and the books that influenced him--is evidenced by the fact that within two decades of its publication most British scientists and much of the public accepted that species evolved.

For the full review, see:

LAURA J. SNYDER. "Reading from the Book of Life; Darwin's radical ideas were accepted surprisingly quickly by an English public already steeped in science." The Wall Street Journal (Sat., April 11, 2015): C6.

(Note: ellipses added.)

(Note: the online version of the review has the date April 10, 2015, and has the title "Science Books That Made Modernity; Darwin's radical ideas were accepted surprisingly quickly by an English public already steeped in science.")

The book under review is:

Secord, James A. Visions of Science: Books and Readers at the Dawn of the Victorian Age. Chicago: University of Chicago Press, 2015.

May 26, 2015

Voters Want Texas-Style Economic Dynamism

(p. A23) Surveys and interviews give us some sense of what's going on. Voters have a lot of economic anxieties. But they also have a template in their heads for what economic dynamism looks like.

That template does not include a big role for government. Polls show that faith in government is near all-time lows. In a Gallup survey, voters listed dysfunctional government as the nation's No. 1 problem. In fact, American voters' traditional distrust has morphed and hardened. They used to think it was bloated and ineffective. Now they think it is bloated and ineffective and rigged to help those who need it least.

When many of these voters think of economic dynamism, they think of places like Texas, the top job producer in the nation over the past decade, and, especially, places like Houston, a low-regulation, low-cost-of-living place. In places like Wisconsin, voters in the middle class private sector support candidates who cut state pensions and pass right-to-work laws, so that economic governance can be more Texas-style.

For the full commentary, see:

David Brooks. "The Field Is Flat." The New York Times (Fri., MARCH 27, 2015): A23.

May 25, 2015

To FDA Aging Is Not a Disease, So FDA Will Not Approve Drugs that Extend Life

(p. D1) Some of the top researchers on aging in the country are trying to get an unusual clinical trial up and running.

. . .

The trial aims to test the drug metformin, a common medication often used to treat Type 2 diabetes, and see if it can delay or prevent other chronic diseases. (The project is being called Targeting/Taming Aging With Metformin, or TAME.) Metformin isn't necessarily more promising than other drugs that have shown signs of extending life and reducing age-related chronic diseases. But metformin has been widely and safely used for more than 60 years, has very few side effects and is inexpensive.

The scientists say that if TAME is a well-designed, large-scale study, the Food and Drug Administration might be persuaded to consider aging as an indication, or preventable condition, a move that could spur drug makers to target factors that contribute to aging.

. . .

(p. D4) Fighting each major disease of old age separately isn't winnable, said S. Jay Olshansky, another TAME project planner and a professor at the school of public health at the University of Illinois at Chicago. "We lower the risk of heart disease, somebody lives long enough to get cancer. If we reduce the risk of cancer, somebody lives long enough to get Alzheimer's disease."

"We are suggesting that the time has arrived to attack them all by going after the biological process of aging," Dr. Olshansky said.

Sandy Walsh, an FDA spokeswoman, said the agency's perspective has long been that "aging" isn't a disease. "We clearly have approved drugs that treat consequences of aging," she said. Although the FDA currently is inclined to treat diseases prevalent in older people as separate medical conditions, "if someone in the drug-development industry found something that treated all of these, we might revisit our thinking."

For the full story, see:

SUMATHI REDDY. "To Grow Old Without Disease." The Wall Street Journal (Tues., March 17, 2015): D1 & D4.

(Note: ellipses added.)

(Note: the online version of the story has the date March 16, 2015, and has the title "Scientists' New Goal: Growing Old Without Disease.")

May 24, 2015

Sears CEO Ed Telling Opposed the "Sloppiness" of Across-the-Board Layoffs

(p. 46) It was never that layoffs were anathema to Telling as such; he just resented the sloppiness of a 10-percent across-the-board layoff when some areas of the company should have been cut by 40 percent and some built up by half.


Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

May 23, 2015

Henry Paulson Fears Chinese Economy "Will Face a Reckoning"

(p. B1) About 340 pages into Henry M. Paulson's new book on China, a sentence comes almost out of nowhere that stops readers in their tracks.

"Frankly, it's not a question of if, but when, China's financial system," he writes, "will face a reckoning and have to contend with a wave of credit losses and debt restructurings."

. . .

(p. B2) Like the United States crisis in 2008, Mr. Paulson worries that in China "the trigger would be a collapse in the real estate market," and he declared in an interview that China is experiencing a real estate bubble. He noted that debt as a percentage of gross domestic product in China rose to 204 percent in June 2014 from 130 percent in 2008.

"Slowing economic growth and rapidly rising debt levels are rarely a happy combination, and China's borrowing spree seems certain to lead to trouble," he wrote.

Mr. Paulson's analysis in his book, "Dealing With China: An Insider Unmasks the New Economic Superpower," is all the more remarkable because he has long been a bull on China and has deep friendships with its senior leaders, who could frown upon his straightforward comments.

For the full commentary, see:

Andrew Ross Sorkin. "DEALBOOK; A Veteran of the Crisis Tells China to Be Wary." The New York Times (Tues., APRIL 21, 2015): B1-B2.

(Note: the online version of the review has the date APRIL 20, 2015, and has the title "DEALBOOK; A Veteran of the Financial Crisis Tells China to Be Wary.")

The book discussed above is:

Paulson, Henry M. Dealing with China: An Insider Unmasks the New Economic Superpower. New York: Twelve, 2015.

May 22, 2015

Longevity and Frugality Allow More Happiness Through New "Second Act" Jobs

(p. B7) Research suggests that happiness over the course of our lives is U-shaped, with our satisfaction deteriorating through our 20s and 30s, hitting bottom in our 40s and then bouncing back from there.

What causes the decline in our happiness during our early adult years? We don't know for sure. It might be the stress of juggling work and home life, or it could be the gradual realization that we won't fulfill all of our youthful ambitions.

But for some, midlife dissatisfaction may reflect growing disenchantment with their chosen career. The good news: Today, thanks to our longer life expectancy, we have time for a second act.

In fact, that second act may be necessary if we are laid off. Our new career could prove more fulfilling, but it might come with a smaller paycheck.

This is a reason to start saving as soon as we enter the workforce. If we do that, we likely will have the financial flexibility to swap into a less lucrative job. What if we haven't been good savers? We may be stuck in a job we have come to hate.

For the full commentary, see:

JONATHAN CLEMENTS. "Can You Afford a Long Life?" The Wall Street Journal (Sat., APRIL 25, 2015): B7.

(Note: the online version of the commentary has the date APRIL 23, 2015, and has the title "What Long Life Spans Mean for Your Money and Career.")

May 21, 2015

Instead of Becoming a Lobbyist, Harry Reid Would "Rather Go to Singapore and Have Them Beat Me with Whips"

Finally an issue on which Harry Reid and Mitch McConnell can agree:

(p. A14) "I've had calls from lots of people," Mr. Reid said. "For example, Al Gore called me. Maybe I want to do something with Al Gore? I have no idea."

But on one matter he was clear: He said he would not be a lobbyist.

"I'd rather go to Singapore and have them beat me with whips," he said.

For the full story, see:

ADAM NAGOURNEY. "Reid to Head Home on New Mission." The New York Times (Thurs., APRIL 3, 2015): A14.

(Note: the online version of the story has the date APRIL 2, 2015, and has the title "Harry Reid Hopes to Ensure Democrats' Success as Tenure Winds Down.")

May 20, 2015

Sears CEO Ed Telling Had an Introverted Fury

Writing of Ed Telling, the eventual entrepreneurial CEO of Sears:

(p. 488) Slowly, the introverted Field soldier from Danville moved up through the organization. He eventually managed the same Midwestern zone he was once made to ride. He found himself in the decadent city-state called the New York group, and it was there, in the strangely methodical fury with which he fell upon the corruption of the group and the profligacy of powerful store jockeys, that certain individuals around him began to feel inspired by his quiet power, as if he'd touched some inverted desire in each of them to do justice at his beckoning and to even numerous scores. He was possessed of a determination to promulgate change such as none of them had ever seen before, and certain hard-bitten bitten veterans like Bill Bass found themselves strangely moved.


Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

May 19, 2015

Technicolor Entrepreneur Kalmus Was Visionary, Stubborn and "in It for the Long Haul"

(p. C15) Judy Garland opening a door from black-and-white Kansas into Technicolor Oz is one of the most enchanting effects in all of movies. But as film historians James Layton and David Pierce relate in "The Dawn of Technicolor: 1915-1935," the technology that made "The Wizard of Oz" possible came from people who were looking to start a business, not to make art.

The creators of Technicolor--engineer W. Burton Wescott and MIT graduates Daniel Comstock and Herbert T. Kalmus--were visionary, though stubborn is just as accurate.

. . .

In 1934 Fortune magazine wrote, "Businessmen regard Dr. Kalmus as a scientist, and scientists regard him as a businessman." Comstock and Westcott eventually left the company in the mid-1920s, but Kalmus was in it for the long haul. . . .

Once perfected, Technicolor had a virtual monopoly on color Hollywood productions, and it did indeed make Kalmus and his investors rich. But it took steel nerves to put money into the unprofitable, ever-tinkering Technicolor of the early days.

For the full review, see:

FARRAN SMITH NEHME. "The Very Thought of Hue; Early color films gave viewers headaches. It took decades to develop a process that didn't simply look odd." The Wall Street Journal (Sat., April 11, 2015): C15.

(Note: ellipses added.)

(Note: the online version of the review has the date April 10, 2015.)

The book under review is:

Layton, James, and David Pierce. The Dawn of Technicolor: 1915-1935. Rochester, NY: George Eastman House, 2015.

May 18, 2015

Obama's Harvard Constitutional Law Professor Likens Obama's Climate Change Policies to "Burning the Constitution"

(p. A1) WASHINGTON -- Laurence H. Tribe, the highly regarded liberal scholar of constitutional law, still speaks of President Obama as a proud teacher would of a star student. "He was one of the most amazing research assistants I've ever had," Mr. Tribe said in a recent interview. Mr. Obama worked for him at Harvard Law School, where Mr. Tribe has taught for four decades.

. . .

Next week Mr. Tribe is to deliver oral arguments for Peabody in the first federal court case about Mr. Obama's climate change rules. Mr. Tribe argues in a brief for the case that in requiring states to cut carbon emissions, thus to change their energy supply from fossil fuels to renewable sources, the E.P.A. is asserting executive power far beyond its lawful authority under the Clean Air Act. At a House hearing last month, Mr. Tribe likened the climate change (p. A15) policies of Mr. Obama to "burning the Constitution."

. . .

While Mr. Tribe is one of the nation's foremost experts on constitutional law, and has argued some Supreme Court cases related to environmental law, he said he has never specialized in the Clean Air Act.

. . .

It is widely expected that the fight over the E.P.A. regulations will eventually go before the Supreme Court. If it does, Mr. Tribe said that he expects he "may well" play a role in that case -- which would be argued before two other former students, Chief Justice John G. Roberts Jr. and Justice Elena Kagan.

For the full story, see:

CORAL DAVENPORT. "Laurence Tribe Fights Climate Case Against Star Pupil From Harvard, President Obama." The New York Times (Tues., APRIL 7, 2015): A1 & A15.

(Note: ellipses added.)

(Note: the online version of the story has the date APRIL 6, 2015, and has the title "Laurence Tribe Fights Climate Case Against Star Pupil From Harvard, President Obama.")

May 17, 2015

The Process Innovations of Ed Telling at Sears

There are a fair number of case studies and biographies of important new product innovations. Rarer are the case studies of process innovations. Two great exceptions are Marc Levinson's The Box and The Great A&P. I have recently read another exception, this one by Donald Katz, about how Ed Telling brought process innovations to Sears from the mid-1970s through the mid-1980s.

In the next few weeks, I will be quoting several of the more useful, or thought-provoking passages.

The book discussed, is:

Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

May 16, 2015

Leadership Depends on Accumulated Experience as Much as Packaged College Courses

(p. 17) The dominant brand, Harvard Business School, claims to "educate leaders who make a difference in the world." The University of Michigan's Ross School does one better, developing "leaders who make a positive difference in the world." Kellogg at Northwestern develops "brave leaders who inspire growth in people, organizations and markets." And Duke's Fuqua says it does what it does because "the world needs leaders of consequence."

. . .

Which raises the question, once again, of whether leadership can be packaged and taught, rather than accumulated through experience.

John Van Maanen, a professor of management at M.I.T. Sloan who teaches a course named "Leading Organizations," isn't so sure it can. "Even today, three-plus decades in, there's no real definition of it," he says. "We can make people more conscious of ethical dilemmas in business, of the difficulty of directing people in times of adversity, and the confidence and communication skills necessary to do so. But the idea that such skills can be transmitted so that you can lead anybody at any time, that's ideologically vacuous."

For the full commentary, see:

DUFF McDONALD. "Can You Learn to Lead?" The New York Times, Education Life Section (Sun., APRIL 12, 2015): 17.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date APRIL 7 (sic), 2015.)

May 15, 2015

Some Immigrate to West for "Peace and Dignity"

(p. A13) There are some words that, through a sort of onomatopoeia, seem fated to be the worst epithets. In Russian, zhid is one of those. Ask any Soviet Jew who grew up in that now extinct empire what it felt like to be on the receiving end of the slur, whose English approximation is "kike," and they will mention the sound: a sinister hiss ending with a snap of the tongue against the back of the teeth.

For Lev Golinkin, the author of a new memoir about his family's immigration from Soviet Ukraine to the West, that sibilant sound dominates most of his memories of life before 1989.

. . .

All their fears--of a government that sought to both erase their Jewish identity and discriminate against them for it, as well as of the unknown ahead--reached their apogee at their moment of immigration: Mr. Golinkin's father, in a desperate attempt to save his life's work, had hidden microfilm of all his patents in his underwear. When he saw how vigorously the border police were searching people, he took the rolls of microfilm to the bathroom and threw them out the window, into a fire blazing inside a steel drum just outside the border post. Once in the West, this man of incredible will achieved the rare feat of rebuilding his career from scratch.

Things didn't work out as well for Mr. Golinkin's mother: She found work only as a security guard.

At one point, a grown Mr. Golinkin confronts her about failing to foresee how difficult re-establishing herself would be, even calling her dreams of America "naïve and ridiculous." She answers that she didn't want to be afraid of her government anymore. She didn't want to tell her son why "he should prepare for a long and painful life." The sacrifice she made, he realizes, was for "peace and dignity, not a paycheck"--and, of course, for him.

For the full review, see:

GAL BECKERMAN. "BOOKSHELF; The Sinister Hiss; The author's father, a successful engineer, hid microfilm of his patents in his underwear in a desperate attempt to save his life's work." The Wall Street Journal (Fri., Dec. 19, 2014): A13.

(Note: ellipsis added; italics in original.)

(Note: the online version of the review has the date Dec. 18, 2014, and has the title "Book Review: 'The Marshmallow Test' by Walter Mischel; To resist the tempting treat, kids looked away, squirmed, sang or simply pretended to take a bite.")

The book under review is:

Golinkin, Lev. A Backpack, a Bear, and Eight Crates of Vodka: A Memoir. New York: Doubleday, 2014.

May 14, 2015

Automation Anxieties Unjustified

(p. 5B) In 1964, technology anxieties caused President Lyndon Johnson to create a national commission on automation. When it reported in 1966, the unemployment rate had dropped to 3.8 percent.

"Technological shocks have been happening for decades, and ... the U.S. economy has been adapting to them," writes economist Timothy Taylor (whose website recounts the 1960s episode).

. . .

Human contact is wanted or needed in places where it seems obsolete. Logically, ATMs should have decimated bank tellers. In reality, the number of tellers (about 600,000) is slightly above its 1990 level, notes Taylor, citing a study by James Bessen of Boston University law school.

For the full commentary, see:

ROBERT J. SAMUELSON. "Must we fear robots in workplace?" Omaha World-Herald (Mon., March 23, 2015): 5B.

(Note: ellipsis internal to quote, in original; ellipsis between paragraphs, added.)

The article by Bessen mentioned above, is:

Bessen, James. "Toil and Technology." Finance and Development 94, no. 1 (March 2015): 16-19.

May 13, 2015

Purdue President Mitch Daniels Opposes "the Bureaucratic Accreditation Process"

(p. A9) As a college administrator, Mr. Daniels has . . . taken notice of the bureaucratic accreditation process that is a prerequisite for receiving federal funds. Six regional groups blessed by the Education Department, as well as a coterie of program-specific organizations, sign off on an institution's programs. The ostensible goal when Congress coupled federal funding with accreditation in the 1952 G.I. Bill was to protect students from colleges hawking worthless degrees.

That hasn't happened. Instead, universities devote considerable resources to a useless process. Almost no institution misses the mark, and since accreditation is done geographically, an upper-tier school like Purdue is accredited by the same agency that has given accreditation to Indiana University East, where the six-year graduation rate is about 18%.

Purdue pays $150,000 annually in direct accreditation fees, working with any combination of 17 agencies--but that doesn't include time. Stanford University Provost John Etchemendy said in a 2011 letter that the school spent $849,000 in one year of a multiyear accreditation. "One suspects you have some basic inertia and some folks would rather spend their time being busy with this than doing something more productive," Mr. Daniels says with a faint smile. "I refer of course to the people on other campuses."

'All this time and money and in the end some really lousy schools get accredited, so I'm not sure what the student--the consumer--learns. An awful lot of make work involved, or so it seems," he says. Sen. Lamar Alexander (R., Tenn.) is considering reforms, including untangling accreditation from federal funding, an idea that Mr. Daniels says "ought to be looked at."

For the full interview, see:

KATE BACHELDER, interviewer. "THE WEEKEND INTERVIEW; How to Save American Colleges; The Purdue president on freezing tuition, how to reduce student debt, and busting the accreditation cartel." The Wall Street Journal (Sat., April 25, 2015): A9.

(Note: ellipsis added.)

(Note: the online version of the interview has the date April 24, 2015.)

May 12, 2015

Aaron Burr Gave Jeremy Bentham a Copy of The Federalist Papers

(p. 720) For four years, the disgraced Burr traveled in Europe, resorting occasionally to the pseudonym H. E. Edwards to keep creditors at bay. Sometimes he lived in opulence with fancy friends and at other times languished in drab single rooms. This aging roué sampled opium and seduced willing noblewomen and chambermaids with a fine impartiality. All the while, he cultivated self-pity. "I find that among the great number of Americans here and there all are hostile to A.B.-- All-- What a lot of rascals they must be to make war on one whom they do not know, on one who never did harm or wished harm to a human being," he recorded in his diary. He befriended the English utilitarian philosopher Jeremy Bentham and spoke to him with remarkable candor. "He really meant to make himself emperor of Mexico," Bentham recalled. "He told me I should be the legislator and he would send a ship of war for me. He gave me an account of his duel with Hamilton. He was sure of being able to kill him, so I thought it little better than murder." Always capable of irreverent surprises, Burr gave Bentham a copy of The Federalist. The shade of Alexander Hamilton rose up to haunt Burr at unexpected moments. In Paris, he called upon Talleyrand, who instructed his secretary to deliver this message to the uninvited caller: "I shall be glad to see Colonel Burr, but please tell him that a portrait of Alexander Hamilton always hangs in my study where all may see it." Burr got the message and left.


Chernow, Ron. Alexander Hamilton. New York: The Penguin Press, 2004.

(Note: italics in original.)

May 11, 2015

"Animals Have Complex Minds and Rich Emotional Lives"

(p. D6) We now know that species from magpies to elephants can recognize themselves in the mirror, which some scientists consider a sign of self-awareness. Rats emit a form of laughter when they're tickled. And dolphins, parrots and dogs show clear signs of distress when their companions die. Together, these and many other findings demonstrate what any devoted pet owner has probably already concluded: that animals have complex minds and rich emotional lives.

For the full review, see:

EMILY ANTHES. "Books; Does That Cat Have O.C.D.?." The New York Times (Tues., JULY 8, 2014): D6.

(Note: the online version of the review has the date JULY 7, 2014.)

The book under review, is:

Braitman, Laurel. Animal Madness: How Anxious Dogs, Compulsive Parrots, and Elephants in Recovery Help Us Understand Ourselves. New York: Simon & Schuster, 2014.

May 10, 2015

117 Year Old Said "Her Life Seemed Rather Short"

(p. A10) Misao Okawa, the world's oldest person, died Wednesday, a few weeks after celebrating her 117th birthday.

. . .

Ms. Okawa, . . . , said at her recent birthday celebration that her life seemed rather short.

For the full story, see:

THE ASSOCIATED PRESS. "WORLD BRIEFING; Japan: Weeks After a Birthday, the World's Oldest Person Dies." The New York Times (Thurs., APRIL 2, 2015): A10.

(Note: ellipses added.)

(Note: the online version of the story has the date APRIL 1, 2015.)

May 9, 2015

Incandescents Better than LEDs at Allowing a Good Night's Sleep

(p. D6) Studies have shown that such light, especially from the blue part of the spectrum, inhibits the body's production of melatonin, a hormone that helps people fall asleep.

. . .

Devices such as smartphones and tablets are often illuminated by light-emitting diodes, or LEDs, that tend to emit more blue light than incandescent products.

For the full story, see:

KATE GALBRAITH. "WIRED WELL; Can Orange Glasses Help You Sleep Better?" The New York Times (Tues., APRIL 7, 2015): D6.

(Note: ellipsis added.)

(Note: the online version of the story has the title "WIRED WELL; Can Orange Glasses Help You Sleep Better?")

May 8, 2015

Self-Made, Abolitionist, Meritocratic Hamilton Viewed as Elitest

(p. 627) To Jefferson we owe the self-congratulatory language of Fourth of July oratory, the evangelical conviction that America serves as a beacon to all humanity. Jefferson told John Dickinson, "Our revolution and its consequences will ameliorate the condition of man over a great portion of the globe." At least on paper, Jefferson possessed a more all-embracing view of democracy than Hamilton, who was always frightened by a sense of the fickle and fallible nature of the masses.

Having said that, one must add that the celebration of the 1800 election as the simple triumph of "progressive" Jeffersonians over "reactionary" Hamiltonians greatly overstates the case. The three terms of Federalist rule had been full of daz-(p. 628)zling accomplishments that Republicans, with their extreme apprehension of federal power, could never have achieved. Under the tutelage of Washington, Adams, and Hamilton, the Federalists had bequeathed to American history a sound federal government with a central bank, a funded debt, a high credit rating, a tax system, a customs service, a coast guard, a navy, and many other institutions that would guarantee the strength to preserve liberty. They activated critical constitutional doctrines that gave the American charter flexibility, forged the bonds of nationhood, and lent an energetic tone to the executive branch in foreign and domestic policy. Hamilton, in particular, bound the nation through his fiscal programs in a way that no Republican could have matched. He helped to establish the rule of law and the culture of capitalism at a time when a revolutionary utopianism and a flirtation with the French Revolution still prevailed among too many Jeffersonians. With their reverence for states' rights, abhorrence of central authority, and cramped interpretation of the Constitution, Republicans would have found it difficult, if not impossible, to achieve these historic feats.

Hamilton had promoted a forward-looking agenda of a modern nation-state with a market economy and an affirmative view of central government. His meritocratic vision allowed greater scope in the economic sphere for the individual liberties that Jefferson defended so eloquently in the political sphere. It was no coincidence that the allegedly aristocratic and reactionary Federalists contained the overwhelming majority of active abolitionists of the period. Elitists they might be, but they were an open, fluid elite, based on merit and money, not on birth and breeding--the antithesis of the southern plantation system. It was the northern economic system that embodied the mix of democracy and capitalism that was to constitute the essence of America in the long run. By no means did the 1800 election represent the unalloyed triumph of good over evil or of commoners over the wellborn.

The 1800 triumph of Republicanism also meant the ascendancy of the slaveholding south. Three Virginia slaveholders--Jefferson, Madison, and Monroe--were to control the White House for the next twenty-four years. These aristocratic exponents of"democracy" not only owned hundreds of human beings but profited from the Constitution's least democratic features: the legality of slavery and the ability of southern states to count three-fifths of their captive populations in calculating their electoral votes. (Without this so-called federal ratio, John Adams would have defeated Thomas Jefferson in 1800.) The Constitution did more than just tolerate slavery: it actively rewarded it. Timothy Pickering was to inveigh against "Negro presidents and Negro congresses"-- that is, presidents and congresses who owed their power to the three-fifths rule. This bias inflated southern power (p. 629) against the north and disfigured the democracy so proudly proclaimed by the Jeffersonians. Slaveholding presidents from the south occupied the presidency for approximately fifty of the seventy-two years following Washington's first inauguration. Many of these slaveholding populists were celebrated by posterity as tribunes of the common people. Meanwhile, the self-made Hamilton, a fervent abolitionist and a staunch believer in meritocracy, was villainized in American history textbooks as an apologist of privilege and wealth.


Chernow, Ron. Alexander Hamilton. New York: The Penguin Press, 2004.

May 7, 2015

Frugal Entrepreneurs May Be Able to Self-Finance Their Innovations

In my Economics of Entrepreneurship seminar we spend part of an evening reading the summary chapter of The Millionaire Next Door, discussed in the tribute below. In the seminar I suggest that at key early moments, innovative entrepreneurs may need to self-finance their innovations. They will be more likely to be able to do so if they have followed Stanley and Danko's advice on how to live frugally.

(p. B1) . . . the enduring lesson of the classic personal finance book, "The Millionaire Next Door," is this: Most of the rich grow wealthy because of modesty, thrift and prudence. They live happily in starter homes. They don't subsidize irresponsible adult children. They have an allergy to luxury automobiles.

. . .

The book, which has sold more than three million copies since its publication in 1996, made its co-author, William D. Danko, a millionaire himself and helped Mr. Stanley achieve similar security and leave academia for research and writing.

. . .

(p. B2) . . . even Mr. Danko, who ought to know better, has not always been able to resist the siren call of the Germans and their advertising. He bought one older Mercedes from a widowed friend, but his other one came new. "I was planning on buying a used one again, but the salesman was very good, and I was weak," he said. "These luxury cars are clearly overrated when you have to get your oil changed, and it costs $200."

. . .

. . . I was curious that Mr. Stanley died behind the wheel of a 2013 Corvette, rammed by another driver who might soon face charges in the accident. Mr. Stanley too, it turns out, couldn't help but have a taste for the finer things in life.

So does that make him a hypocrite? Or just a human being? All the best research tells us that we get much more joy out of doing things than having things, and a weekend drive in a car that goes really fast probably falls into both categories. But he earned that drive -- and that car -- by putting untold numbers of readers in a position where they'd be lucky enough to have that same choice themselves.

For the full commentary, see:

RON LIEBER. "YOUR MONEY; A Tribute to the 'Millionaire Next Door'." The New York Times (Sat., MARCH 7, 2015): B1-B2.

(Note: ellipses added.)

(Note: the online version of the commentary has the date MARCH 6, 2015, and has the title "YOUR MONEY; Paying Tribute to Thomas Stanley and His 'Millionaire Next Door'.")

The book under discussion is:

Stanley, Thomas J., and William D. Danko. The Millionaire Next Door: The Surprising Secrets of America's Wealthy. First ed. Atlanta: Longstreet Press, 1996.

May 6, 2015

Economic Growth Depends on the Talented Becoming Entrepreneurs Instead of Rent Seekers

(p. 6) In an influential paper, the economists Kevin M. Murphy and Robert W. Vishny, both at the University of Chicago Booth School of Business, and Andrei Shleifer at Harvard University argue that countries suffer when talented people become what we economists call "rent seekers." Instead of creating wealth, rent seekers simply transfer it -- from others to themselves.

Job titles don't tell you whether someone is primarily a rent seeker. A lawyer who helps draft precise contracts may actually be helping the wheels of commerce turn, and so creating wealth. But trial lawyers in a country with poorly functioning tort systems may simply be extracting rents: They can make money by pursuing frivolous lawsuits.

For the full commentary, see:

SENDHIL MULLAINATHAN. "Economic View; Maximizing the Social Returns to a Career in Finance." The New York Times, SundayBusiness Section (Sun., APRIL 12, 2015): 6.

(Note: the online version of the commentary has the date APRIL 10, 2015, and has the title "Economic View; Why a Harvard Professor Has Mixed Feelings When Students Take Jobs in Finance.")

The paper praised and summarized above, is:

Murphy, Kevin M., Andrei Shleifer, and Robert W. Vishny. "The Allocation of Talent: Implications for Growth." Quarterly Journal of Economics 106, no. 2 (May 1991): 503-30.

May 5, 2015

As an Entrepreneur "You're Much More in Control of Your Life"

(p. C1) The financial crisis rocked and reshaped Wall Street, forcing many people to reassess their careers. Since then, a steady stream of executives has left Wall Street firms and multimillion-dollar salaries to hang out their own shingles. But for many, the allure of autonomy quickly gives way to everyday realities that can be jarring.

. . .

(p. C2) . . . , the jump from Wall Street to entrepreneurship, and any potential fall, can be steep. Unlike in Silicon Valley, where entrepreneurs benefit from an ingrained startup culture and network of venture-capital backers, Wall Street exiles often launch startups midcareer and without an equivalent institutional framework.

. . .

Milton Berlinski, a founding member of Goldman Sachs's financial institutions investment-banking group, hopped from one work location to another as he figured out what he wanted to do after he left the bank in 2012.

. . .

This month, Mr. Berlinski moved his team of 13 people into a 6,000-square-foot office that his entire group helped design, from choosing the paint to picking the furniture. "In some ways, you're starting from scratch," said Mr. Berlinski. "You're spending time working harder, but you're much more in control of your life."

For the full story, see:

ANUPREETA DAS. "Financial Startups Take Leap Sans Net." The Wall Street Journal (Weds., April 8, 2015): C1-C2.

(Note: ellipses added.)

(Note: the online version of the story has the date April 7, 2015, and has the title "Financial Startups Make the Jump Without a Net.")

May 4, 2015

Hamilton's SEUM at Paterson Was an Early Failure of Centrally Planned Industrial Policy

(p. 384) The 1792 financial panic came on the heels of the two great projects by which Hamilton hoped to excite the public with the shimmering prospects for American manufacturing: the Society for Establishing Useful Manufactures and submission of his Report on Manufactures. The outlook for both was badly damaged by the panic. Even a short list of the worst offenders in the share mania--William Duer, Alexander Macomb, New York broker John Dewhurst, Royal Flint--included so many SEUM directors that it almost sounded like a company venture. Duer's notoriety was especially detrimental since he had been SEUM governor, its largest shareholder, and its chief salesman in hawking securities.

. . .

(p. 385) How exactly would the SEUM, its coffers cleaned out by Duer, pay for its property on the Passaic River? Hamilton privately approached William Seton at the Bank of New York and arranged a five-thousand-dollar loan at a reduced 5 percent interest rate. He cited high-minded reasons, including the public interest and the advantage to New York City of having a manufacturing town across the Hudson, but more than the public interest was at stake: "To you, my dear Sir, I will not scruple to say in confidence that the Bank of New York shall suffer no diminution of its pecuniary faculties from any accommodations it may afford to the Society in question. I feel my reputation concerned in its welfare." The SEUM's collapse, Hamilton knew, could jeopardize his own career. In promising Seton that he would see to it as treasury secretary that the Bank of New York was fully compensated for any financial sacrifice entailed by the SEUM loan, Hamilton mingled too freely his public and private roles.

(p. 386) For several days in early July 1792, Hamilton huddled with the society directors to hammer out a new program. "Perseverance in almost any plan is better than fickleness and fluctuation," he was to lecture one superintendent, with what could almost have been his personal motto. Rewarding his efforts, the society approved wide-ranging operations: a cotton mill, a textile printing plant, a spinning and weaving operation, and housing for fifty workers on quarter-acre plots. Never timid about his own expertise, Hamilton pinpointed the precise spot for the factory at the foot of the waterfalls that had so impressed him with their strength and beauty during the Revolutionary War.

It was an index of the hope generated by Hamilton that the SEUM, at his suggestion, hired Pierre Charles L'Enfant, the architect who had just laid out plans for the new federal city on the Potomac River, to supervise construction of the society's buildings and plan the futuristic town of Paterson. At the same time, it was an index of Hamilton's persistent anxiety that he dipped into managerial minutiae befitting a factory foreman rather than an overworked treasury secretary. For instance, he instructed the directors to draw up an inventory of tools possessed by each worker and stated that, if any were broken, the parts should be returned and "a report made to the storekeeper and noted in some proper column." With his reputation at stake, Hamilton even subsidized the venture with his own limited funds, advancing $1,800 to the mechanics. Despite the Duer fiasco, the SEUM commenced operations in spinning, weaving, and calico printing.

The subsequent society records make for pretty dismal reading, as Hamilton was beset by unending troubles. L'Enfant was the wrong man for the job. Instead of trying to conserve money for the cash-strapped society, he contrived extravagant plans for a seven-mile-long stone aqueduct to carry water. He was enthralled by the idea of creating a grand industrial city on the pattern of the nascent Washington, D.C., with long radiating avenues, rather than with building a simple factory. By early 1794, L'Enfant shucked the project and spirited off the blueprints into the bargain. To find qualified textile workers, the society sent scouts to Scotland and paid for the laborers' passage to America. Even the managers clamored for better pay, and SEUM minutes show that some disgruntled artisans personally hired by Hamilton began to sabotage the operation by stealing machinery. One of the saddest parts of the story relates to the employment of children. Whatever hopeful vision Hamilton may have had of children performing useful labor and being educated simultaneously, they had neither the time nor the money to attend school. To remedy the problem, the board hired a schoolmaster to instruct the factory children on Sundays--which, as Hamilton must have known, was scarcely a satisfactory solution.

By early 1796, with Hamilton still on the board, the society abandoned its final (p. 387) lines of business, discontinued work at the factory, and put the cotton mill up for sale. Hamilton's fertile dream left behind only a set of derelict buildings by the river. At first, it looked as if the venture had completely backfired. During the next two years, not a single manufacturing society received a charter in the United States. Hamilton's faith in textile manufacturing in Paterson was eventually vindicated in the early 1800s as a "raceway" system of canals powered textile mills and other forms of manufacturing, still visible today in the Great Falls Historic District. The city that Hamilton helped to found did achieve fame for extensive manufacturing operations, including foundries, textile mills, silk mills , locomotive factories, and the Colt Gun works. Hamilton had chosen the wrong sponsors at the wrong time. In recruiting Duer and L'Enfant, he had exercised poor judgment. He was launching too many initiatives, crowded too close together, as if he wanted to remake the entire country in a flash.


Chernow, Ron. Alexander Hamilton. New York: The Penguin Press, 2004.

(Note: italics in original.)

May 3, 2015

Social Security "Produces Inequality Systematically"

(p. B5) Mr. Kotlikoff, 64, did not set out to become Dr. Social Security. Two decades ago, he and a colleague were studying the adequacy of life insurance. To do so, you need to know something about Social Security. Soon, Mr. Kotlikoff was developing a computer model for various payouts from the government program and realized that consumers might actually pay to use it.

From that instinct, a service called Maximize My Social Security was born, though it wasn't easy to do and get it right. "We had to develop very detailed code, and the whole Social Security rule book is written in geek," he said. "It's impossible to understand."

Because of that, most people filing for benefits have to get lucky enough to encounter a true expert in their social circle, at a Social Security office or on its hotline. They are rare, and this information dissymmetry offends Mr. Kotlikoff. "We have a system that produces inequality systematically," he said. It's not because of what the beneficiaries earned, either; it's simply based on their (perhaps random) access to those who have a deep understanding of the rules.

. . .

"Get What's Yours" is a useful book. Indeed, we all need better instruction guides for the many parts of our financial lives that only grow more complex over time.

For the full commentary, see:

RON LIEBER. "YOUR MONEY; The Social Security Maze and Other U.S. Mysteries." The New York Times (Sat., MARCH 14, 2015): B1 & B5.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date MARCH 13, 2015.)

The book under discussion is:

Kotlikoff, Laurence J., Philip Moeller, and Paul Solman. Get What's Yours: The Secrets to Maxing out Your Social Security. New York: Simon & Schuster, 2015.

May 2, 2015

Fongoli Chimps, Where Prey Is Scarce, Show "Respect of Ownership"

(p. A10) The Fongoli chimpanzees live in a mix of savanna and woodlands where prey is not as abundant as in rain forests. There are no red colobus monkeys, and although the chimps do hunt young vervet monkeys and baboons, the much smaller bush babies are their main prey.

Dr. Pruetz argues that less food may have prompted both technological and social innovation, resulting in new ways to hunt and new social interactions as well. Humans evolved in a similar environment, and, as she and her colleagues write in Royal Society Open Science, "tool-assisted hunting could have similarly been important for early hominins."

. . .

By and large, said Dr. Pruetz, the adult males, which could take away a kill, show a "respect of ownership." Theft rates are only about 5 percent. The chimps she studies also have more mixed-sex social groups than chimp bands in East Africa.

Travis Pickering, an anthropologist at the University of Wisconsin, said that with less food available it seems that the Fongoli chimps, "have to be more inventive" and that "these hunting weapons even the playing field for non-adults and females."

Early hominins may have been in a similar situation, he said.

For the full story, see:

JAMES GORMAN. "Hunter Chimps Offer New View on Evolution." The New York Times (Fri., APRIL 15, 2015): A10.

(Note: ellipsis added.)

(Note: the online version of the story has the date APRIL 14, 2015, and has the title "Chimps That Hunt Offer a New View on Evolution.")

The academic article discussed above is:

Pruetz, Jill D., Paco Bertolani, K. Boyer Ontl, S. Lindshield, M. Shelley, and E. G. Wessling. "New Evidence on the Tool-Assisted Hunting Exhibited by Chimpanzees (Pan Troglodytes Verus) in a Savannah Habitat at Fongoli, Sénégal." Royal Society Open Science 2, no. 4 (Weds., April 15, 2015), URL: http://rsos.royalsocietypublishing.org/content/2/4/140507.abstract .

May 1, 2015

Resilient Italian Entrepreneur Planned to Build Trattoria and Ended Up Building Museum

FaggianoAndSonsDigToFixPipe2015-04-19.jpg "Luciano Faggiano and his sons were digging to fix a pipe in Lecce, Italy. They found a buried world tracing back before Jesus." Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A1) LECCE, Italy -- All Luciano Faggiano wanted when he purchased the seemingly unremarkable building at 56 Via Ascanio Grandi was to open a trattoria. The only problem was the toilet.

Sewage kept backing up. So Mr. Faggiano enlisted his two older sons to help him dig a trench and investigate. He predicted the job would take about a week.

If only.

"We found underground corridors and other rooms, so we kept digging," said Mr. Faggiano, 60.

His search for a sewage pipe, which began in 2000, became one family's tale of obsession and discovery. He found a subterranean world tracing back before the birth of Jesus: a Messapian tomb, a Roman granary, a Franciscan chapel and even etchings from the Knights Templar. His tratto-(p. A8)ria instead became a museum, where relics still turn up today.

. . .

If this history only later became clear, what was immediately obvious was that finding the pipe would be a much bigger project than Mr. Faggiano had anticipated. He did not initially tell his wife about the extent of the work, possibly because he was tying a rope around the chest of his youngest son, Davide, then 12, and lowering him to dig in small, darkened openings.

. . .

Mr. Faggiano still dreamed of a trattoria, even if the project had become his white whale. He supported his family with rent from an upstairs floor in the building and income on other properties.

"I was still digging to find my pipe," he said. "Every day we would find new artifacts."

. . .

Today, the building is Museum Faggiano, an independent archaeological museum authorized by the Lecce government. Spiral metal stairwells allow visitors to descend through the underground chambers, while sections of glass flooring underscore the building's historical layers.

His docent, Rosa Anna Romano, is the widow of an amateur speleologist who helped discover the Grotto of Cervi, a cave on the coastline near Lecce that is decorated in Neolithic pictographs. While taking an outdoor bathroom break, the husband had noticed holes in the ground that led to the underground grotto.

"We were brought together by sewage systems," Mr. Faggiano joked.

. . .

"I still want it," he said of the trattoria. "I'm very stubborn."

For the full story, see:

JIM YARDLEY. "Home Repair Opens a Portal to Italy's Past." The New York Times (Fri., APRIL 15, 2015): A1 & A8.

(Note: ellipses added.)

(Note: the online version of the story has the date APRIL 14, 2015, and has the title "Centuries of Italian History Are Unearthed in Quest to Fix Toilet.")


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