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Network neutrality and a dubious leap of faith

Out of the Storm News - October 21, 2014, 8:00 AM

The latest wrinkle in the ongoing debate over network neutrality comes from Rep. Henry Waxman, D-Calif., ranking member of the House Committee on Energy and Commerce, who suggests the Federal Communications Commission adopt a “third way” in regulating the way last-mile Internet service providers like Comcast, AT&T and Verizon handle traffic from major video content providers like Netflix, Amazon and Google’s YouTube.

Waxman’s proposal was detailed in a filing in the FCC’s latest inquiry into ways it can effectively enforce network neutrality. While current FCC net neutrality guidelines allow ISPs the freedom to take “reasonable” steps to prioritize or manage traffic to improve quality or protect other applications, Waxman is among those who want the government to take a larger, more active role in managing the Internet ecosystem. Waxman states he wants a “bright-line” rule against any ISP blocking, throttling or paid prioritization.

Waxman agrees with many activists who want the FCC to change the regulatory classification of ISPs as written in the Telecommunications Act of 1996.

Regulations for ISPs are spelled out under Title I of the act. Here, with the intention of fostering a growing industry, Congress intentionally sought to keep regulation minimal and the compliance burden low. Title II of the act spells out regulations for older telephone companies, and derives heavily from the 1930s-era monopoly regulations that ended 30 years ago. Dated as it is today, the Telecom Act was a bipartisan effort, spurred by the arrival of both the Internet and wireless phone service, to transition the telecom industry from monopoly to competitive business.

Waxman is among those who want to reverse this 30-year course, and reclassify competitive wireline and wireless ISPs as Title II common carriers subject to a host of rules and regulations on rates and services.

Trouble is, even those who favor network neutrality are divided as to whether reclassification is the correct remedy. Even as he asks for public comment, FCC Chairman Thomas Wheeler has expressed some reservations about reclassification. Wheeler has stated “we don’t want to put rules in place that would dis-incentivize companies from making…continued investment.”

So did his predecessor, Julius Genachowski, whose own “third way” stopped short of this step. Both might worry that reclassification would impose egregious pricing and service conditions on ISPs that would be counterproductive in the long run. Others have pointed out that despite all the new rules reclassification would add, it would not prohibit paid prioritization. The U.S. Post Office, after all, is a regulated common carrier, yet it can offer Express Mail.

Waxman’s solution — boiled down — is to trust the government to restrain itself. Waxman points to another part of the Telecom Act, Section 706, and suggests that it be woven into the reclassification.

Section 706 is something of an elastic clause in Telecom Act. It allows the FCC to investigate whether advanced communications technologies — the definition of which includes the Internet — are being deployed in a reasonable and timely manner and to “take immediate action” to remedy any perceived problem.

What Waxman hopes is that the FCC can reclassify ISPs as Title II carriers, then use Section 706 to ban ISP prioritization, but disregard, or forbear, all of the other Title II requirements. Not only does this open all sorts of legal questions, beginning with whether the FCC can alter definitions set by congressional legislation, it also counts on the FCC to deliberately restrain itself from using the additional regulatory power Waxman’s proposal would give it.

Given the attempts the FCC has already made to expand its purview, Waxman is asking Americans to take a big leap of faith. Through the past two administrations, the FCC has continually sought to increase its regulatory scope beyond broadcasting and into cable TV and Internet. Just in the past week Wheeler has suggested the FCC regulate subscription-based Internet video services and use its indecency rules to stop sports reporters from saying the Washington Redskins team name on the air.

Waxman’s solution is weak because it tries to jam new realities — on-demand Web video, wireless Internet and changing consumer viewing habits — into regulatory silos that are three decades old. Rather than trying to redefine FCC scope through a sloppy cut-and-paste of outmoded law, Congress should revisit the Telecom Act in its entirety— modernizing it to fit the Internet ecosystem of our time.

It’s doubtful the digital economy will be served by tempting the FCC to take a power trip through this evolving landscape. There still too much of a chance for unintended consequences if the FCC is allowed unchecked discretion in overhauling the underlying economics of the Internet industry.

Wisdom from Bill Gray

Somewhat Reasonable - October 20, 2014, 4:53 PM

Though CO2 continues to accumulate in the atmosphere, global satellites show surface temperatures have not increased for the past 18 years.

Additionally, an article by Hurricane Guru Bill Gray in the Coloradan points out:

• Winter snow cover has been gradually increasing across the northern hemisphere in recent years.

• Antarctic sea ice is now at record high levels. Net global sea ice has shown no long-period downward trend.

• U.S. and global droughts, floods and severe weather have shown no significant changes over the past half century when atmospheric CO2 amounts have risen by 35 percent.

• The United States is currently experiencing the longest continuous period (nine years) without a major hurricane strike. Tornado activity has been below average the past three years.

These results confound climate alarmists who trust computer models more than their own senses and actual climate observations. The models can’t account for any of these trends.

Gray points out natural climate change and severe and unusual weather events have always occurred and will continue to occur in the future regardless of atmospheric CO2 levels.

As a result, switching to renewable energy will greatly raise our energy costs and significantly lower the U.S.’s and the world’s standard of living, but do nothing for the environment.

Only misanthropes could recommend making the world less hospitable for humans – perhaps this is the real reason alarmists continue to push for energy restrictions despite the mounting evidence global warming, if it starts up again, will be mild and possibly beneficial?

 

Categories: On the Blog

Thorner & Ingold: CDC’s Incoherent Ebola Failed Strategy Evolution

Somewhat Reasonable - October 20, 2014, 2:53 PM

By Nancy Thorner & Ed Ingold – 

Four officials in blue plastic hazmat suits. (Source: YouTube)

Dr. Tom Frieden appeared before an House committee today (10/16) to testify on CDC’s response to Ebola in America. It’s hard to say where his position comes from, whether a reflection of White House talking points, political correctness, or just a physician’s tendency toward self-deification (not unknown among bureaucrats either). When asked if he was being coached by anyone, he evaded the question.

CDC: Imposing travel restrictions on West Africa would inhibit humanitarian activities and strangle emerging economies.

FACT: Restrictions would be for non-essential travel. Humanitarian aid could continue, with the stipulation that returning workers would be subject to a three week quarantine. The“struggling economy” of West Africa consists primarily of oil, cacao and coffee. Nearly half of the world’s chocolate comes from this region. We are not proposing an embargo, just limits on non-essential travel. However travel restrictions might have a secondary effect on the quality of breakfast in

CDC: Travel restrictions would force people to take devious routes to the United States, making it harder to screen those at risk for Ebola and take necessary precautions.

FACT: Even without restrictions, there is a strong incentive for those at risk to bypass the existing screening procedure, or simply conceal signs of illness and lie on questionnaires. The alternative is to be denied access to US health care and face a long quarantine period. This has already occurred for the first domestic case of Ebola, where the person lied to gain entry, then went to the emergency room at the first mild signs of illness, rather than a local pharmacy (or bed) like the rest of us.

The prime directive to control the spread of disease is to isolate and eradicate. Travel restrictions are an essential ingredient for isolation. Every domestic case of Ebola requires the services of dozens of health care workers, monitoring of hundreds of persons potentially exposed to the disease, at enormous cost. Moreover health care workers are at the greatest risk of infection – Ebola is becoming known as “the nurse killer.” We cannot afford to import a single case of Ebola through carelessness, and screening is demonstrably ineffective. Congress should demand an account of these costs from the CDC.

CDC, the DNC and Democratic Congressmen: Republicans cut the budget of CDC by $500 million, making it harder to combat the Ebola epidemic here and abroad.

FACT:  The Sequestration cuts only discretionary spending (used to study duck sexuality and build treadmills for shrimp), and limits only increases in that spending. The actual budget was not cut, rather the CDC is getting a smaller increase than requested. The “Sequestration” was, in fact, proposed by the Obama, passed both houses of Congress and signed by the President. In the actual budget, Congress approved 50% more money for disease control than requested by the President – $176 Million v $135 Million. In actuality, Obama pushed for CDC cuts years before the Elboa outbreak As to Democrats blaming Republican for the spread of Ebloa on budget cuts, the GOP house passed a budget increasing DCD spending by 8-1/2 %. The phantom budget cuts are but a desperate measure by Democrats and have nothing to do with why CDC fumbled Ebola!

CDC: The protocols recommended for the protection of health care personnel are in place and effective.

FACT: Actually neither is true. Workers at Edison Hospital in Dallas were not properly trained nor equipped for Ebola treatment, and the published protocols are not effective. The “official” protocol calls for disposable surgical gowns, face masks and gloves. There is no head covering, respirators, leggings nor shoe covers (aside from “booties” intended to keep dirt from being tracked into treatment areas). Meanwhile, Dr. Frieden appeared in Africa wearing full HAZMAT gear, being hosed down with a chlorine solution for decontamination. While the “official” gear is disposable, it cannot be disinfected for safe degowning. Nor were the protocols being followed. The Nurses at Edison complain that they received no training and inadequate gear. They used medical tape for extra protection. When the second health care worker arrived for treatment, after being diagnosed with Ebola, she was accompanied by two workers in full HAZMAT gear and someone in street clothes carrying a clipboard. Some protocol!

There is no reason to panic, but at the same time we must insist that effective procedures be established and followed. There should be national standards for procedures, and a limit on non-essential travel to and from West Africa, both of which which can be imposed at any time by the HHS Secretary or President Obama. Secondly, we must get honest evaluations of the risks and progress as they develop, not Disney-ish star wishes. The only thing which will prevent panic is trust in the government we elect to protect us. It is abundantly clear that Dr. Frieden is no “war time consigliore.” The real experts reside in the military, for which command and control already exist for biological and chemical containment.

Addendum to original Illinois Review article:

Dr. Frieden, head of the CDC not a practicing physician. He is the former head of New York State Public Health, a politician through and through. He just needs to polish his spin skills. That’s where the newly appointed Ebola Czar, Ron Klain, comes into play. Spinning is his only skill, and as Chief Adviser for Joe Biden and Al Gore, he appears to be pretty good at it. What he doesn’t have is any medical background, administrative experience, nor technical expertise whatsoever. His job will be to take heat away from the President, and make us all feel good.

Nothing Obama does is without a political purpose. I suspect that by  treating the Ebola crisis in such a cavalier and counter-intuitive manner, he is taking attention away from the economy and the host of “phony” scandals haunting him. This is a calculated gamble. It is unlikely that there will be a lot of casualties to Ebola in the United States. However the cost and resources required to handle even a few dozen cases will be enormous, and occupy the headlines for weeks. At stake are the lives of those we depend on for our health and well being – nurses and doctors, not to mention the 4000 soldiers destined to serve in West Africa, their friends and dependents.

 

Categories: On the Blog

Heartland Daily Podcast: Ernest Istook – No Subsidies for Wind-Power

Somewhat Reasonable - October 20, 2014, 2:23 PM

Former Oklahoma 7-term Congressman Ernest Istook is leading the charge against a renewal of the wind-power production tax credit which under which the federal government pays wind power producers 2.3 cents per kilowatt hour.  Even with this subsidy, wind power is more expensive than traditional fossil fuel power plants.

Over ten years the federal government has paid tens of billions of dollars to wind producers for unreliable power.  Istook points out that raising the costs of energy, as the PTC does, harms the poor, minorities and those on fixed incomes the worst.  He argues for an energy neutral energy policy.  No subsidies for any energy source and equal treatment under tax laws.

 

Categories: On the Blog

Killing Confidence in Our Government

Somewhat Reasonable - October 20, 2014, 1:15 PM

What has been the over-riding theme of life in America since Barack Obama became President in 2008?

It has been the continued loss of confidence Americans have regarding various elements of the federal government. From the Centers for Disease Control, the Veterans Administration, the Secret Service, to the Department of Justice and the Internal Revenue Service, these and other agencies have been tainted in ways that have turned his two terms into a litany of scandals and failures.

Obama is a President for whom politics is the sole reason against which every decision is made. The latest example was the naming of an Ebola Czar. “Sources confirm to Fox News that President Obama plans to name Ron Klain, a longtime political hand with no apparent medical or health background.” In the past, Klain has served as chief of staff to Al Gore and Joe Biden. Does this make you feel any better about the Ebola threat?

I think that most Americans—not the “low information” ignorant ones—are experiencing a generalized depression about the nation these days. It’s a sense of weariness because our paychecks don’t stretch enough in the supermarket where the cost of food, particularly meat and fish, is soaring.

We wonder about the quality of education our children or grandchildren are receiving. It’s poor when compared to other nations and it undermines a belief in America’s exceptionalism.

In growing numbers younger Americans are choosing not to marry because of the costs involved and because we live in a society that no longer frowns on a couple living together; nearly half of marriages end in divorce. And then there’s same-sex marriage, a concept that was unthinkable not that long ago and for centuries in all societies.

We’re now six years into the Great Recession thanks to a White House that thought that, if the government spent $834 billion on top of the national debt, it would somehow “stimulate” the economy but government spending did not relieve Americans during the Great Depression, generate new jobs or achieve anything else that this tried-and-failed liberal theory was said to do. Who was in charge of Obama’s “stimulus” program? Ron Klain, the new Ebola Czar.

Cutting taxes, slowing and reducing regulations, and generally getting out of the way to allow people to start or expand their businesses works, but the White House went the other direction. As an October 16 Wall Street Journal editorial noted, “Millions of American families haven’t had a raise in after-inflation incomes in years, but in Washington times are flush…the U.S. federal government rolled up record revenues of $3.013 trillion.” Individual income tax receipts rose by 5.9%, along with payroll taxes and corporate income taxes—very nearly the highest in the world—increased 16% to $321 billion.

Only the naïve or ignorant believe that the government knows how to spend our money better than we do, but liberals—Democrats—do. Their answer to every problem government encounters is more money, but not to repair and expand the infrastructure, roads and bridges, on which the nation depends and not for a military that is currently at low pre-World War Two levels of personnel and old equipment of every description.

Our current Secretary of State, John Kerry, is going around echoing the President, telling people that mankind is doomed because “climate change” is coming and will destroy all life unless billions or trillions are spent in ways that will avoid it. Only no one can avoid climate change because that’s what climate does; it changes with well-known and predictable cycles tied to the Sun’s cycles.

Our military’s mission is now being redirected to addressing “climate change” at a time when, having been withdrawn from Iraq, a new, larger and far more dangerous entity, the Islamic State, has emerged, stretching into Syria as well.

The President recently gave an interview to France’s Canel+ TV Channel and said that the American people need to be better educated about Islam, claiming that the U.S. should be regarded as a Muslim country because of the number of Muslims living here. The truth is that the U.S. has one of the smallest percentages of Muslims of any Western nation, about 1.5% of the population. Americans know everything they need to about Islam. They recently watched two of their countrymen beheaded by the Islamic State.

The President appears to prefer unapologetic liars as his advisors. Consider Susan Rice who came to fame by lying on five Sunday television shows that the Benghazi attack in 2012 was the result of a video no one had seen and more recently said that Turkey had agreed to permit the U.S. to undertake military flights to attack ISIS only to have Turkey deny that within hours. She is Obama’s national security advisor and that is cause enough for concern, but guess to whom the new Ebola Czar, Ron Klain, will be reporting? Susan Rice.

While Obama has been in office the population has been growing by virtue of the millions of illegal aliens that have been entering. This year there was a dramatic virtual invasion of children and others from Guatemala and San Salvador at the invitation of the President. They were quickly dispersed throughout the U.S. and just as quickly schools around the nation began to report outbreaks of the diseases they brought. At the same time, deportations have declined this year.

The President has sent more than 4,000 of our military to Africa’s Ebola hot zone and he did so rapidly as what will be described as a humanitarian gesture, but he has never seen any necessity to dispatch our military to our southern border to stem illegal entry. Indeed, his administration has taken Arizona to court when it passed legislation to address the problem. In the meantime, we are left to wonder what will happen if our soldiers become ill with Ebola?

Indeed, his signature legislation, ObamaCare, is destroying our healthcare system and is a testament to the lies he repeatedly told before the Democrats in Congress passed it in 2009. No Republican voted for it. After the midterm elections, hundreds of thousands will learn that their employers will no longer provide them with healthcare insurance.

Americans are left to wonder how the nation can survive a President who has steadily engaged in programs that have harmed America’s economy—he is the first to have had our national credit rating reduced.

In the process he has ignored the limits imposed on his office by the Constitution. The courts have repeatedly rebuked this.

On November 4th voters will have an opportunity to go to the polls and vote out as many of his supporters, incumbent Democrats and candidates for Congress, as possible. Our confidence in our government must be restored with new leadership.

Categories: On the Blog

America’s motor state going the wrong way on direct sales

Out of the Storm News - October 20, 2014, 9:30 AM

For most of my life, the Detroit area has been the epicenter of the domestic automotive world. Unless you are the sort of person who experienced a fainting spell when the National Corvette Museum in Kentucky dropped eight historically precious Corvettes into a big sinkhole last winter (including the one-millionth model ever produced) you probably still get most of your interesting domestic car news from Michigan.

I have a friend who has been saving for a while for a Chevy pickup, her dream vehicle. Her dad and other family members drove Chevys, and it’s embedded in the family culture. A lot of my neighbors without a firm brand allegiance lust instead after the new Tesla electric vehicle that changed most everybody’s idea about what an electric car could provide in the way of thrills more traditional to the driving culture than the cultures of saving money or saving the environment.

Several years ago, I was seated at a business next to the CEO of a business that made car parts. His opinion was that American companies were the slowest to innovate of all the major car companies in the world. That was largely before cars were built in pieces all over the world, which began the erosion of the “domestic content” rules that now are mostly impeding foreign sales by American solar energy industries. But that’s a topic for another day.

The Tesla is very innovative. It may even be a game changer at some point. It offers style, exciting driving and a low-impact on the environment, all in one. Oh yes, and it comes with a new direct-to-consumer marketing strategy as well! Ooops, maybe not in Michigan.

The forces aligned against disruptive ways of satisfying consumer demand have gotten, in the space of a couple days, an amendment into a bill that passed both houses and is sitting on the governor’s desk. The amendment prohibits Tesla — in the largest state in which company doesn’t yet have a sales office — from selling directly to its prospective customers. The company has said it had been discussing an approach to sales in Michigan with political leaders in the legislature and appropriate government agencies, until the amendment was adopted and voted on with great alacrity by the General Assembly.

There was never any public debate, and news reports suggest that most members of the legislature were unaware of the impact until the auto dealers started thanking them for their votes. That is, for voting to protect Michigan customers from having more choices about what to drive.

We’ve seen a lot of this lately. It’s just plain bad faith by lawmaking bodies to not at least host some discussion on a law that puts a death sentence on what appears to be a perfectly reasonable business model. If signed by Gov. Rick Snyder, sales of a shiny new consumer product will be impossible in Michigan unless the company decides to sell through traditional dealerships. It is difficult not to notice that these middlemen are third parties that are very active politically, in what was supposed to be a pretty close election for governor this time.

When I worked in the legislature years ago, it used to be considered normal that if your side had the votes on a bill, you were at least accommodating enough to let the opposition make their case before you enacted new requirements or prohibitions. The public is well served by debate. Yet we have seen less and less of it on most of the things that matter. Even the famous cut-and-paste job that has become the federal health insurance law was accompanied by extensive public debate before the final version was sewn together.

Apparently the only part of the process that Tesla was able to engage was a conversation with the governor’s office after the bill passed. The intended election year pressure is now fully upon the governor. We will see next week whether he decides to stick with his philosophy on how markets work best for his constituents, or is forced to bow to special interest politics.

I doubt if this innovative, named for one of the greatest scientists who ever lived, can be stamped out with the rearguard action by Michigan dealers. But it can surely be inhibited by the wrong decision from the state’s leadership.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Does Prop 103 violate itself?

Out of the Storm News - October 20, 2014, 9:00 AM

The history of the American administrative state has been filled with attempts to introduce “rationality” and “discipline” to circumstances in which markets, left to their own devices, allegedly lead to socially or politically undesirable outcomes.

Brimming with good will and well-meaning intention, champions of state intervention seek to invent systems to accommodate and serve those least able to care for themselves. Californians can even directly participate in such efforts through the initiative process.

In 1988, a slim majority of California voters passed Proposition 103, a landmark initiative they were told would reform the state’s auto insurance market for the better. What they did not count on was that, more than 25 years later, Prop 103’s architects would still be standing protectively, to thwart any attempt to update the initiative to reflect changes in the market, technology and the world at-large.

Within a few years, experts now predict, self-driving and autonomous vehicles will radically change the risk profile of vehicles on California’s roads. A recent study by the Casualty Actuary Society found these vehicles could be expected to eliminate as much as 51 percent of accidents. But while that’s encouraging from a health and safety perspective, thanks in part to Prop 103, reducing accidents by such an overwhelming margin could have perverse impacts on drivers who can’t afford to upgrade to cars with more advanced safety technology.

Prop 103′s process for approving auto insurance rates is rigid. There’s a statutory hierarchy, with three mandatory rating factors that insurers must take into account above all others, the first of which is accident history. Self-driving and autonomous vehicles will experience far fewer accidents as a result of driver error, which currently is and historically always has been the cause of most accidents.

Since operators of self-driving and autonomous vehicles will experience fewer accidents, their premiums will decrease. But the benefits conferred to early adopters will be balanced out by higher rates for those who continue to drive conventional vehicles. Under Prop 103, insurance rates are a zero-sum game.

The law requires insurers to increase or decrease the significance of cost factors to comply with the rating-factor hierarchy. This “pumping and tempering” occurs independent of the actual cost associated with a rating factor. Thus, even though other rating factors will be of greater significance to self-driving and autonomous vehicles, Prop 103’s inflexibility will continue to require accident history to be the single most important determinant in the rate-making process.

The result will be that other members of the “class plan” will have to make up the reduced cost of early adopters. In a state split between vehicle operators who bear transportation risk and others who do not, Prop 103 will burden those least able to foot the bill.

If traditional drivers are made to cross-subsidize operators of self-driving and autonomous vehicles, it is likely Prop 103 will run afoul of its own judicially constructed purpose. In a 2005 state appeals court decision, Foundation for Taxpayer and Consumer Rights v. Garamendi, a discussion of the appropriateness of a legislatively enacted change to Prop 103 led the court to find that the initiative’s purpose was to protect the uninsured from arbitrary rates, so that insurance could be “fair, available and affordable.” In the context of a persistency rating factor that the court decided subsidized the insured at the expense of the uninsured, that purpose was deemed violated.

But what happens when existing language, faced with novel circumstances, leads to an identical result? Left unchanged, Prop 103 will violate its own purpose.

Perhaps, in the name of “fairness,” and to forestall the inevitable dismantling of their ugly creation, the drafters of Prop 103 will seek a ban on autonomous vehicles. For now, fortunately, they are satisfied to ignore reality and claim that “California is a long, long way from the so-called ‘autonomous vehicle.’”

To avoid problems like these in the future, the Prop 103 model should be scrapped entirely. Failing that, to properly address the risk presented by self-driving and autonomous vehicles, different rating factors will need to be introduced and given hierarchical flexibility. Contextual factors will be of particular importance, since they likely will present the greatest hurdles to self-guidance programs. For instance, a region’s weather and the quality of its road network could both predictively relate to an autonomous vehicle’s risk profile.

Increasingly and inevitably, Prop 103 is proof that the regulatory rationale of one moment can grow stale in the next. Prop 103 has swollen useless and counterproductive government intervention. More distressing still, Prop 103 now may injure the very same economically deprived people it was passed to help.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

‘Waters of the United States’ could be most significant EPA rule you’ve never heard of

Out of the Storm News - October 20, 2014, 8:30 AM

In 1972, Congress enacted the Clean Water Act to “restore and maintain the chemical, physical and biological integrity of the nation’s waters.” The federal government’s legal authority to regulate water is largely derived from the U.S. Constitution’s Commerce Clause, which theoretically limits the government’s jurisdiction to the type of navigable waterways where such commerce occurs. Sadly, the federal government is rarely content with any limitation placed on its regulatory authority.

Although the CWA defines “navigable waters” as “the waters of the United States, including the territorial seas,” federal regulators further define the “waters of the United States” to cover traditional navigable waters and all other waters that could affect interstate or foreign commerce. The current regulatory definition opens up more waters to CWA coverage but still attempts to track Congress’ Commerce Clause authority.

Now the EPA and Army Corps of Engineers are taking advantage of a particularly unclear Supreme Court ruling in Rapanos v. United States. Narrowly interpreted, the 2006 Rapanos decision gives the EPA regulatory authority over wetlands “with a continuous surface connection” to navigable waterways. Read broadly, the Rapanos decision gives the EPA authority under the CWA to regulate water with a mere “significant nexus” to navigable waterways.

As a result of the Supreme Court’s lack of clarity, the EPA and Army Corps of Engineers have proposed to expand the coverage of the CWA in an exceptionally far-reaching manner. Many conservatives, agriculture groups and even the U.S. Small Business Administration are calling for the proposed rule to be withdrawn.

On October 8, 2014, Alabama Attorney General Luther Strange joined other state attorneys general opposing the new definition. The joint letter noted that many of “the waters and lands covered [by the proposed rule] are entirely outside of Congress’ authority under the Commerce Clause, such as non-navigable intrastate waters that lack any significant nexus to a core water, trenching upon state authority, including in areas of non-economic activity.”

The Alabama Farmers Federation has also raised concerns about the impact of the proposed rule on Alabama. “The government overreach from this rule would extend beyond farms to affect businesses, homes, schools, churches – any place built on land where water runs through after a heavy rain,” said ALFA president Jimmy Parnell. “This was never the intent of the Clean Water Act, and this bypassing of Congress should not be allowed.”

Baldwin County farmer Hope Cassebaum echoed Parnell’s concerns. “Farmers don’t need any more regulations than what we have now,” said Cassebaum. “It’s sad because we already try to be the best stewards of the land that we can be.”

Elmore County farmer Richard Edgar proudly highlighted that his family has worked with the USDA’s Natural Resources Conservation Service for generations. “We have some of the first, and still well-maintained, parallel terraces which are best for the environment,” said Edgar.

At the same time, Edgar considers the EPA’s move to be more about federal control than true environmental concern. “My children are the sixth generation on this land,” he said. “We’re going to take care of our farmland because we have a legacy and hope for the future. We don’t need government telling us how to take care of it.”

The CWA has been a major success in cleaning up our national waters, but federal authority under the act is not without limit. The EPA and Army Corps of Engineers are pressing the boundaries of their federal jurisdiction to their breaking point, and Alabamians would be wise to pay attention.

Federal survey data on tobacco: It’s not about the children

Out of the Storm News - October 20, 2014, 8:00 AM

I have documented for several years a continuous decline in smoking rates among American teens. Rates of smoking and use of other tobacco products among teens are so low that they no longer provide a valid basis for the draconian anti-tobacco policy prescriptions favored by the FDA and CDC.

A fresh National Survey on Drug Use and Health summary confirms low tobacco use by teens. The chart below shows that the smoking rate continued its free-fall through 2013. Cigar use also declined over the past decade to 2.3 percent in 2013, while smokeless tobacco use was flat at about 2 percent over the entire period.

These figures aren’t underestimates. As I’ve discussed previously, NSDUH estimates tend to be robust, because they include any product use over the prior 30 days.

Other NSDUH data (in the chart at bottom) point to the population that should be targeted by the FDA and CDC – those aged 18-34. The sharp jump in smoking prevalence from 11 percent at ages 16-17, to 27 percent at ages 18-20, underscores that the latter group is where the real problem starts.

Anti-tobacco forces know that problematic behaviors in adults don’t stimulate support for prohibitionist policies, so they continue to inaccurately suggest the existence of a youth-tobacco crisis.

 

A Young Person’s Guide to Energy Conservation

Somewhat Reasonable - October 20, 2014, 7:03 AM

Energy has long lost the attention of the media, so we no longer think about ways we use energy and its effect on national policy or our pocketbooks.  However, the problems of energy supply we deemed a crisis in the 1970’s are still with us and a new crisis may be due to our own making.

U. S. warships are still in the Persian Gulf to keep open the supply of Middle East oil which still accounts for about one-quarter the world’s oil production. Conflicts in North Africa, the Middle East, and the Ukraine all involve energy supply. Poverty in Sub-Sahara Africa and its present Ebola crisis are due to 70 percent of its inhabitants not having access to electricity.

On an individual basis, stringent energy conservation can help postpone future crises and, for individuals, reduce the cost of living. After the cost of a home mortgage or rent, energy is the greatest expense for the average individual. (I am ignoring taxes and social security being an expense; politicians do.) For those with houses paid for, energy is the number one cost of living expense.

For individuals, energy is purchased in the form of gasoline, oil, natural gas, propane, and electricity. Over the period of one year, a family will spend $4,000-plus for energy. In order to achieve significant savings in energy costs, one must think about how energy is being used and the ways to reduce this consumption. The attitude of “I want to keep my money and not give it to oil companies or utilities,” must be developed.  Because of taxes, you have to earn two cents in order to have one cent to spend on energy.  Consequently, every cent saved on energy costs is equivalent to earning two cents.

The use of energy can be broken down into several broad categories: transportation, heating, air conditioning, water use, and miscellaneous. These categories are listed in decreasing order of expense. By use of these rules, I have been able to reduce my energy consumption by one-third of prior use.

TRANSPORTATION
The average home spends more than $3000 annually on gasoline; add in maintenance, insurance, and car tags and you are talking real money.

  1. Drive like a brake job cost $100,000.  Every time you use your brakes, you are converting gasoline energy into heat which consumes brake linings.  Don’t follow cars closely.  Anticipate traffic lights blocks ahead and coast to stops.  Don’t accelerate too fast and avoid making quick stops.  Front disc brakes should last 65,000 miles and rear brakes over 100,000 miles.
  2. Drive as fast as safe in city driving remembering the efficiency of motors improves with higher speeds.
  3. Keep your car perfectly tuned.  Determine your cars miles per gallon every time you add gas and if the mileage falls, realize some type of maintenance is in order.
  4. Don’t drive!   Walking is good for your health and saves on gas consumption.  It’s foolish driving around a parking lot looking for a close-in parking space.  Park the minute you enter a parking lot and walk to store’s entrances—this also saves on dents from parking between cars.
  5. Use radial tires and make sure proper air pressure is maintained at all times.  Keep a tire gauge and check tire pressure every month.  Don’t forget the spare tire.
  6. Avoid driving during periods of traffic congestion if possible.  Also avoid making senseless shopping trips.   Plan ahead and make several stops on the same trip.
  7. Consider car mileage when purchasing new cars.  The mileage for new and old cars is found at the website “fuel economy.com”.
  8. Use the cheapest gas available in your area.  The price of gasoline at all fuel stations is also found at “fuel economy.com”.
  9. Use air conditioning sparingly because it requires substantial engine power; however, at high speeds always have all windows closed to reduce air resistance and use air conditioning if needed for comfort.
  10. Help other drivers save on gasoline by letting them make left turns or into traffic flow when waiting.

HOME HEATING
Heating accounts for about 40 percent of the energy use for homes with air conditioning and 50 percent of energy use for homes without air conditioning.

  1. Seal all holes leading into a home with caulking.  This stops outside air infiltration and loss of heated air in the winter.  Holes may be found around window frames, door frames, and ceiling beams that extend outside.  This is by far the cheapest means of energy conservation and is quite effective.
  2. Weather strip all exterior doors and windows.
  3. Make sure the home is insulated to Building Code Standards.  For Atlanta, GA the minimum standard is 3 ½ inches of insulation (R-11) in exterior walls and 6 inches of insulation in exterior ceilings (R-19.  I prefer fiberglass batts for insulation because they hold their shape permanently, non-toxic, and cheap.  In addition, I recommend 12 inches insulation for attics.   For older homes without insulation it may be cost prohibitive to install wall insulation; however, attics are usually open and placing 12-inch batts is not expensive if the homeowner does the work.
  4. Install storm doors and storm windows.  Because of expense hiring proper installation, this may not be cost effective.  Benefits are great in energy savings and also reducing outside noise.  Keeping drapes closed can accomplish some of the effect of storm windows.  Double pane windows are also effective energy savers.  These are available at reasonable cost from building supply stores and if self-installed the payback period may be only ten years.  I properly installed double pane windows and storm windows giving me triple pane windows that made big heating improvements and almost eliminated outside noise.
  5. Insulate all supply and return ducts in the heating system if they are located in attics or crawl spaces.  In addition, make sure all duct joints are properly taped to prevent leakage.
  6. Clean and replace the air filter for the blower on a regular basis.
  7. Heat rooms only in use.  Do not shut off returns to your heating system; but you can shut off supply ducts as long as they don’t exceed 30 percent of supply lines.
  8. Install a programmable thermostat that allows temperature settings dependent upon the home use.  Late night temperatures can be set to 60 degrees that allows big savings—for every degree in setback the fuel savings may exceed 2 percent.   Set daytime temperatures according to occupancy of home.
  9. Avoid using exhaust fans in the kitchen or bathrooms.  Their use sends hot air outside and brings in cold air from the outside.
  10. Let the sun help heat the house in the winter by opening drapes of south facing windows during the daytime.

AIR CONDITIONING
Homes with air conditioning use 25 to 35 percent of their energy use in this fashion.

  1. Employ items a, b, c, d, e, f, g, and h described under home heating.
  2. For central air conditioning systems clean the outside condenser coils every spring because this helps increase the efficiency of the air conditioner by maybe 10 or 20 percent.
  3. Set thermostat temperatures as high as comfortable.  Each degree increase may reduce energy use by 5 percent.
  4. For Southern states with high air conditioning use, utilities have summer peak demands from 5 to 7 on weekday evenings as homes switch on their air conditioners upon return from work.  Utilities are trying to reduce this load by offering variable pricing to discourage electricity use in peak demand periods.  Instead of charging 16 cents per kilowatt-hour for summer electricity, a utility may charge 28 cents per kilowatt-hour from 2-7 p.m. weekdays and 10 cents per kilowatt-hour the rest of the time.  The programmable thermostat can be used to lower utility bills by adopting this type of pricing.  Air conditioners are most efficient late at night when outside temperatures are at their lowest.  With a programmable thermostat the air conditioner can be set for 70 degrees from 11 p.m. until 8 a.m. in the morning.  For weekdays from 8 a.m. until 2 p.m. the thermostat can be set for 73 degrees, from 2 p.m. to 7 p.m. the thermostat can be set for 80 degrees, and then from 7 p.m. until 11 p.m. the thermostat can be set to 73 degrees.  On weekends the thermostat can be set for 73 degrees from 8 a.m. until 11 p.m.  By not using the dishwasher, washing machine, or dryer during weekday peak hours, I have reduced my summer electricity bill by 20 percent.
  5. When replacing an air conditioner, make sure the unit is not oversized for the job.  Contractors like to specify one ton of air conditioning for every 500 square feet of living space.  If the techniques described in part “a” are employed, you can probably get by with one ton of air conditioning for every 800 square feet of living space.  The smaller unit will run longer and keep the humidity low which adds to comfort.
  6. Make sure there is ventilation in the attic.  If the attic is properly insulated, attic fans may not be economical in reducing power costs.
  7. In the daytime pull drapes over Southern and Western facing windows.  I have placed movable shutters on Western windows that totally block out incoming sun for the summer and allow sun in the winter.
  8. Avoid excessive use of exhaust fans because they pull hot air into the house.  However, use exhaust fans when taking showers because they add to humidity in the house.
  9. Air conditioners can be a source of water during a drought.  Water is taken out of the air by the cooling coils and pumped outside by a small pump.  For every ton of air conditioning you may produce 5 gallons of water per day.  This water can be collected and used for watering plants.

WATER
Water is becoming expensive across the country due to shortages and repairs of old water treatment and sewage plants.   In Atlanta, Georgia the average home uses 6000 gallons per month and the cost is $138.  The marginal rate for the last gallons used in 2.5 cents per gallon.  In addition to water costs, there is the heating cost for hot water needed for washing individuals, food services, and cloths.  Water heating can be 10 percent of home energy use.

  1. Use low flow toilets in the home that are1.6 gallons per flush or lower.  The Atlanta water system pays $100 each for replacement of old, high flow toilets.
  2. If you kill a bug and throw it into the toilet; don’t flush the toilet, it costs too much.
  3. Use water saving shower heads and faucets.  This may cut water heating costs in half.
  4. Use dishwashers because they save on water use and make sure they are full when using them.
  5. Use washing machines only when they are full of dirty cloths.
  6. Set the thermostat temperature on water heaters to the low setting of 120 degrees.  This reduces heat losses from water heaters and associated plumbing and also reduces chances of scalding from inappropriate application of hot water to humans.
  7. Insulating hot water pipes can save energy; however, cost benefits may be marginal.
  8. Heat losses from gas water heaters are matched to the energy output of the pilot light.  So the standby loss of a gas hot water heater is zero when the thermostat is set to the lowest level of 120 degrees.   Gas water heaters with pilot lights are convenient because they work during power outages.  So forget buying a gas water heater with electronic ignition.
  9. Electric water heaters are made to operate with heat pumps.  They are very expensive; but reduce energy demand by two-thirds.  If a home requires large amounts of hot water, this type of water heater may be economical.
  10. In the design of new homes or remodeling, locate kitchens, bathrooms, and other areas that use hot water close to the water heater in order to have short lengths of hot water plumbing.

MISCELLANEOUS ENERGY SAVINGS TIPS

  1. Save on lighting energy use by employing compact fluorescent light bulbs (CFL) or LED lighting.   These devices reduce lighting energy use by 80 percent.  CFLs are sold in home improvement stores for about $10 an eight-pack; while LED bulbs are about $15 apiece.  So CFLs are the financial choice; however, remember each CFL contains 4 milligrams of mercury, so their use demands locations in areas where breakage is unlikely.  After CFLs fail, they need to be returned to the purchase location for disposal.
  2. Buy and use energy savings appliances.  Microwave ovens use far less energy than stoves; so use them at all times when practical.
  3. New stoves and refrigerators are far more energy efficient than models sold twenty or more years ago.  When buying gas stoves, consider types without pilot lights and self-cleaning because they are better insulated and use less energy.
  4. Improve the efficiency of refrigerators or freezers by cleaning their condenser coils annually.
  5. Keep refrigerators and freezers full as possible and avoid excessive or prolonged opening their doors.
  6. When cooking on stove tops use covered pans to save energy.
  7. Place furniture around interior walls of rooms in order to have increased comfort in both summer and winter.
  8. Cloth’s dryers suck in outside air during operation.   Arrange their time of use so they do the least demand on heating or air conditioning systems.
  9. Turn computers off when not in use for extended periods like overnight.
  10. Flat screen televisions use substantially less energy than older models.  If TV sets are old, large models, and used a lot; consider buying a new one.  Turn televisions off when not in use.

Employing these tips can save hundreds to thousands of dollars annually.  Always keep energy in mind during daily activities and save money for other uses and benefit the nation’s best interests.

Categories: On the Blog

HBO Streaming Announcement Is Good News for All Entertainment Consumers, Not Just HBO Watchers

Somewhat Reasonable - October 19, 2014, 7:48 PM

Acting on plans reported here a month ago, entertainment channel HBO has decided to end its thirty-plus-year dependence on cable and satellite distributors, announcing it will offer an online streaming video service beginning next year. Following a trail blazed by Netflix, Amazon.com, Acorn Media, and others, HBO will offer the service without a cable subscription in an effort to reach the ten-million-plus broadband-only homes, a category that is increasing steadily.

In his announcement, HBO chairman and CEO Richard Piepler said that the company had not yet decided what distribution method to use: partnering with a cable or Internet provider or offering the service directly to consumers on the Netflix model. A possible clue to HBO’s thinking is its deal, reached earlier this year, to license much of its library to Amazon for the latter’s Prime service.

One imagines that HBO’s accounting people ran the numbers for the various scenarios before the bosses made the decision to go solo, so it seems likely that HBO already knows what direction they want to take. And the fact that they haven’t yet announced their specific plan suggests that it isn’t option three, to go it alone, as they certainly could have made that part of the announcement had they chosen. And given the ferment regarding net neutrality—the idea, fostered by Google, Netflix, and other big business users of internet bandwidth, that the government should ban broadband providers from charging fair prices for the use of their information pipelines—it makes sense for HBO to stay out of that morass and let a partner deal with the headache of delivering the service to its customers.

In any case, this is good news for entertainment consumers, even those of us who are not interested in HBO’s programs. When Turner Classic Movies goes solo, I will be very tempted to take down my satellite dish.

Such an exodus away from the current cable and satellite delivery system may turn out to be what finally breaks the hold of ESPN, Disney, Viacom, and other powerful entertainment conglomerates on people’s pocketbooks. These corporations have long benefited from the practice of bundling, in which content providers force cable and satellite companies to buy several unpopular channels in order to get the one people do watch, and they charge the distributors (the cable and satellite companies) extortionate fees to carry the programming bundles. Thus people across the country who have cable or satellite TV are required to pay an average of $5 per month apiece to ESPN owner Disney Corp. in order to get cable, even if they hate ESPN and never watch it.

Those companies and the major sports leagues have made an outrageous fortune off of people who never watch their programming, and the same is the case for Disney’s other channels and Viacom and the like. The cable and satellite providers have been unable to break these programmers’ power, and that is what has been behind the dizzying rise of monthly fees for these services. That can’t go on much longer, and HBO’s announcement is quite revealing, as a powerful programming source is clearly eyeing the door in obvious awareness that the current system is unsustainable.

We will soon find out how many HBO viewers resent having to pay huge fees for ESPN, Disney, and Viacom programs they don’t watch.

Change is going to come, and probably sooner than most parties imagine. HBO’s announcement is a strong indication that it’s “game on” now in the entertainment media world—and in the case of ESPN and the other big entertainment providers, perhaps “game over” very soon for their current cushy deals.

[First published at The American Culture.]

 

Categories: On the Blog

Black Thursday Is Coming in December: Politicians Want Green, Taxpayers Will See Red!

Somewhat Reasonable - October 19, 2014, 4:00 PM

A yearly $14.7 billion tax increase could be in place as early as mid-December courtesy of the leaders of the U.S. Senate.

Almost immediately after the World Wide Web made its debut some folks were hard at work figuring out a way to muscle in on the action. Some proposed taxing Internet access while others wanted to charge a higher tax on items bought via the Web than if that same item had been bought at a brick-and-mortar store. This Internet looting led to the passage of the Internet Tax Freedom Act (ITFA) in 1998, 16 years ago.

Originally intended to be permanent but negotiated down to temporary, and grandfathering in jurisdictions that were already taxing Internet access to give them time to adjust their tax codes and budgets, the law put in place a moratorium on “Internet taxes,” that is, taxes on Internet access and on multiple or discriminatory taxes on Internet commerce. Since then, ITFA has been extended several times, including recently when it was extended until Thursday, December 11—or what we should dub another Black Thursday.

The American Action Forum released an analysis showing that the cost to taxpayers would be $14.7 billion annually. This tax increase is the very real cost of failing to extend the moratorium permanently.

Who would support this massive tax increase in the middle of a still struggling, sluggish economy?  As the private and public sectors spend millions of dollars to ensure people have broadband access, why impose a new tax that will disproportionately affect those least able to pay?

The only thing holding back a permanent moratorium and removing the grandfathered jurisdictions seems to be the Senate, where Senators Harry Reid and Dick Durbin are holding the moratorium hostage as they try to find a way to force through something oxymoronically named the Mainstreet Fairness Act (MFA).

The proposal would do  away with any requirement that a business have a physical connection to a jurisdiction before it can be forced to levy taxes on its sales. If this law were to pass, a person merely calling up a business’s Website would be enough to require that a business pay taxes in the state where the customer resides. Out-of-state tax authorities could audit businesses in any state. A discriminatory Internet tax would look promising by comparison.

But holding the moratorium hostage to the MFA is illogical at best, and perhaps legislative malpractice. The moratorium staves off a huge tax increase, while the MFA enables vastly broader powers for tax authorities. Virtually opposite goals.

In addition, the MFA is fundamentally about where a taxable transaction takes place, a far more complicated discussion than a prohibition on discriminatory taxation. The MFA is appropriately fully debated in the context of how location-based taxation should be handled in an age of digital transactions, not smuggled through Congress via some hidden trick in an attempt to please a narrow constituency.

The number of cosponsors and the congressional committee votes demonstrate that a permanent moratorium that removes the grandfathered jurisdictions has a huge margin of support. However, if the two bills are forced together in the Senate nothing will pass, and the country will labor under another huge tax increase.

[Originally published at the Institute for Policy Innovation]

Categories: On the Blog

Silicon Valley’s Biggest Internet Mistake

Somewhat Reasonable - October 19, 2014, 8:00 AM

Hubris causes blind spots.

Silicon Valley is putting its foreign Internet franchise at risk by imagining what happens in Washington D.C. stays in D.C.

Silicon Valley’s net neutrality tunnel vision in America blinds it to the disastrous international policy repercussions of promoting a protectionist industrial policy for Silicon Valley at the FCC, exactly when most other nations are looking for any pretext to justify imposing their own protectionist policies in response to Edward Snowden’s revelations of NSA spying.

To appreciate the biggest Internet mistake that Silicon Valley interests are making, one first needs to understand what they want from the FCC.

They want consumers to subsidize Silicon Valley’s cost of their commercial streaming to users in the form of a permanent FCC-set, zero-price for downstream traffic to their users.

To secure this large infrastructure-use government subsidy, Silicon Valley interests need the FCC to reclassify the U.S. Internet from a lightly-regulated “information” service to a utility-regulated “telecommunications” service, while simultaneously undoing, or “forbearing” from, some of the new utility regulations they just imposed.

So what is Silicon Valley’s biggest Internet mistake?

Legally, “telecommunications” is what international treaties and agreements regulate like a utility, under the Constitution of the United Nations’ International Telecommunications Union (ITU).

Specifically, ITU agreement: ITU-T D.50, recognizes the sovereign right of each State to regulate “telecommunications” as that State determines.

Apparently, Silicon Valley interests are blind to the many risks of “telecommunications” regulation to their foreign businesses.

First, the FCC reclassifying the American Internet as “telecommunications” predictably would invite most every other country to reclassify their Internet traffic as “telecommunications” too, so that they could impose lucrative price tariffs on Silicon Valley’s dominant share of Internet traffic into their countries.

Second, there is no “forbearance,” or undoing, process from the ITU’s “telecommunications” utility regulations.

Third, a new FCC-led protectionist, “telecommunications” trade dynamic, would give foreign regulators every incentive to protect their national interests at Silicon Valley’s expense.

Fourth, the world is watching.

Fadi Chehade, Internet governance leader and President of the Internet Corporation for Assigned Names and Numbers (ICANN,) told the Washington Post: “You think that how the FCC decides to move forward with net neutrality only affects America? No. The whole world is watching how this country manages its Internet.”

Simply, since Silicon Valley benefits the most from free trade and the free flow of information, they also have the most to lose from advocating for the FCC to protect Silicon Valley commercially with large Internet infrastructure-use government subsidies.

For example, Google alone sends roughly 8 billion video streams overseas daily.

Most countries in the world salivate at the prospect of America’s FCC leading the world in price regulating Internet traffic flows for America’s benefit.

It would provide priceless political cover for autocratic countries like China and Russia, to impose their own nationalist Internet regulations and censorship policies.

It also would eviscerate any moral or policy high-ground the U.S. could have to stave off protectionist trade policies for information services, like the European Parliament’s call to end the U.S.-EU Data Safe Harbor and many countries’ calls for data storage localization.

That’s because foreign negotiators could say that their countries were only doing for their national champions what the FCC did for America’s Silicon Valley national champions.

And unfortunately, price regulating Internet traffic as “telecommunications” likely would require privacy-invasive, deep-packet-inspection, at sovereign borders in order to determine who owes whom what under an ITU “telecommunications” sender-party-pays, trade-settlement regime.

In sum, hubris causes blind spots.

[Originally posted on The Daily Caller]

 

Categories: On the Blog

Fairness to Your Opponent: In Praise of the Heartland Institute's Treatment of An Inconvenient Truth

Stuff We Wish We Wrote - Homepage - October 17, 2014, 4:17 PM
It has been several years since I watched Al Gore’s film An Inconvenient Truth on global warming climate change. The circumstances were interesting. The…

Stop Playing the Ebola “Blame Game”

Somewhat Reasonable - October 17, 2014, 4:02 PM

When medical officials confirmed that a second individual involved with delivering treatment to the original Ebola patient contracted the disease, my concerns grew. When more news surfaced that the plane the individual flew on traveled to other airports before being decontaminated-namely the busiest in the country- scenes from the movie Contagion instantly flooded my mind. Ebola has proven that it is a disease without borders and many people would like some assurance that the US health care system has this under control. I certainly have not gotten that assurance yet. Instead a “blame game” has commenced.

This week, the Agenda Project Action Fund began airing an ad targeting Mitch McConnell, John Boehner, Marco Rubio and several other GOP Senate candidates, declaring “Republican cuts kill,” directly blaming Congressional Republicans for the Ebola outbreak. This new Democratic talking point was provoked by statements from National Institutes of Health (NIH) Director Francis Collins. He told the Huffington Post that the agency has been working to develop an Ebola vaccine for more than a decade but was hindered by dwindling budgets. Collins says, “Frankly, if we had not gone through our 10-year slide in research support, we probably would have had a vaccine in time for this that would’ve gone through clinical trials and would have been ready.”

The 2014 NIH budget  was $30.14 billion, up from $28.5 billion in 2006. Due to the impact of inflation that is a small cut; however, the agency also obtained a $10 billion windfall in 2009 from the stimulus law. Additionally, in January, the Republican-led House passed legislation that increased the Center for Disease Control (CDC) spending for 2014 by $567 million, which is $300 million more than was request by President Obama. The Agenda Project ad also fails to note that the U.S. Global Health Program budget has increased more than six-fold since 2001.

The claim by Dr. Collins called for some observers, including Michael Tanner from Cato Institute, to point to some questionable NIH-funded studies like a study on the sex life of fruit flies, a study to determine why people like Seinfeld reruns, and a study of how fast husbands and wives calm down after a fight.

With one death, two active cases, and several more Americans under surveillance, it is becoming clear that the CDC was not ready for the likelihood of this event. Procedures were not in place and preparation was inadequate. Ebola patients have been successfully treated in the U.S. prior to the recent outbreak without transmitting the virus to others caring for them. The main concern must be guaranteeing that the right treatment procedures are available and that those providing treatment are conscientiously abiding by proper measures. It is imperative there are clear processes to monitor and assess those who may have been exposed to the virus. Decontaminating possibly infected areas should be done promptly and efficiently. The administration, state and local officials, the CDC and NIH all have a laundry list of things to do to encourage Americans that the right steps to avoid an outbreak are in place. This relates to protocols and appropriation of funds.

Yesterday, the head of the CDC Tom Frieden said he is “always open to ideas” on how to handle Ebola. While that remark wasn’t necessarily reassuring, he is on the right track. Instead of playing the “blame game,” let’s start playing the “crisis management game” and reassure Americans this is not Contagion.

Categories: On the Blog

How SOPA would have cost the content industry billions

Out of the Storm News - October 17, 2014, 2:34 PM

Ever since the advent of Internet-based, user generated mass media, Hollywood has been fighting a losing game of whack-a-mole against ordinary online users who share copyright-protected material in ways its creator didn’t explicitly authorize.

In particular, sites like YouTube, Vimeo and Dailymotion have enabled the proliferation of covers of popular songs, parodies, mash-ups of clips from movies and/or television shows (sometimes combined with music) and even, in some cases, people actually posting full movies online.

This kind of activity has sparked aggressive lobbying for ever harsher and harsher anti-piracy and pro-copyright laws by content creators. As anyone who watched the battle over the Stop Online Piracy Act in 2012 can attest, large segments of the content-producing world were seeking a government-enforced “blacklist” system, in which Internet service providers would be forced to treat practically any alleged copyright infringement as grounds to render a site unviewable.

Which is ironic, because the would-be “victims” who argued the hardest for SOPA have made more than $1 billion from the very proliferation of creativity they once tried to kill. That’s the tally, the Financial Times reports, for revenues derived by more than 5,000 companies (including all of the major U.S. television and film studios) who participate in YouTube’s “ContentID” program.

Under the program, creators are entitled to revenue streams from advertising sold on user-generated content that makes use of copyrighted material. Since it was established in 2007, most creators have opted to monetize the content, rather than block it.

The end result is mutually beneficial for creators, users and, ultimately, consumers. In some cases, it can open new revenue streams associated, for instance, with films that might otherwise have languished in a proverbial vault of commercial flops. Users who want to get discovered for their covers of popular songs, or simply want a space to perform, need not fear take-down notices for the crime of doing nothing but singing.

Which is not to say that Content ID itself is always perfect. It doesn’t provide users with much recourse if their video is unjustly flagged as a copyright violation even if a court might determine it falls under fair use. Disputes are referred to the rights-holder, and some video game critics raised concerns late last year that they ended up in a Sisyphean struggle over their reviews, which clearly fall under the “criticism” exception of fair use, with quibbles over such minutia as music that was licensed for use in game trailers, but not for YouTube users.

Ultimately, however, these issues represent not a problem with Content ID, but with the legal copyright regime it is required to enforce. While that fight is still in progress, these sorts of market-oriented compromises at least allow access to art that otherwise would be strangled by short-sighted rights-holders who don’t always see the financial rewards right in front of them.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Search engines, free advertising and the content industry

Out of the Storm News - October 17, 2014, 12:43 PM

In 1925, a music industry professional complained to the New York Times that the new medium of radio was destroying the industry’s business model by making songs too widely available to the public for free. The Times quoted the unnamed professional saying:

The public will not buy songs it can hear almost at will by a brief manipulation of the radio dials. If we could control completely the broadcasting of our compositions we would endeavor to prevent this saturation of the radio listeners with any particular song.[…]

We are striving to have the copyright law, which protects us from the free use of our compositions by the makers of phonograph records and music rolls, construed to cover broadcasting. The law specifies that we must be compensated if any of our songs are used by some one else for profit to them. We contend that the radio station is an enterprise founded for gain. It is not controlled by those purveying sets or parts, it is employed by organizations which use it as a medium of institutional advertising.

The music industry professional got his wish as far as copyright, and has turned out to be right in another way as well, though surely not in a way he would have expected. Radio is treated as free advertising – and primarily for music producers! This is, in fact, the main reason why terrestrial radio stations are presently statutorily exempt from paying royalties.

Today, the story of radio’s transition from content industry bete noir to one of its core advertisers is being replayed in the case of another medium that content industry professionals once lambasted as nothing but a gateway for pirates: search engines,

In a report released today by Google, the company lays out the case that search engines aren’t major driver of piracy.  The report claims that search is responsible for just 16 percent of the traffic to sites that host pirated content. By contrast, studies have shown that 64 percent of the traffic to legitimate sites comes from search engines.

To take one example, “katy perry” gets searched for 200,000 more times on Google than “free katy perry mp3.” What’s more, under new changes to the company’s search algorithm, legitimate sources of Katy Perry’s music will show up first on both searches, at no cost to Perry herself (though individual content salesmen such as Apple, Amazon or Spotify can pay to have their digital storefronts advertised prominently).

Starting in 2012, Google began “downranking” sites that receive a high volume of Digital Millennium Copyright Act take-down complaints, meaning that those results automatically are ranked lower in Google’s search algorithm. The new tweaks will go further to prioritize results for  legitimate sources of film, music and other copyrighted content, as well as offering users multiple sources from which that content can be purchased, rented or streamed. This would apply even for obvious piracy-oriented searches, such as “the big lebowski torrent.”

In short, for content producers, search engines serve as a form of free advertising, paid for either by middlemen online retailers, or by the search engine itself. As the Google report puts it:

Piracy often arises when consumer demand goes unmet by legitimate supply. As services ranging from Netflix to Spotify to iTunes have demonstrated, the best way to combat piracy is with better and more convenient legitimate services. The right combination of price, convenience and inventory will do far more to reduce piracy than enforcement can.

Consumers have a huge appetite for content, and there’s evidence that they’re willing to pay a lot for it. A report from May 2013 found that the most frequent consumers of pirated digital files actually spend 300 percent more on content than so-called “honest” consumers. This tendency for piracy itself to serve as a form of free advertising is why savvy media producers, such as the makers of HBO’s Game of Thrones, find high piracy rates flattering, rather than alarming. Once HBO’s new stand-alone streaming service launches, these users of pirated content easily could turn into legitimate consumers.

Search engines thus have a huge opportunity to exploit a market with an above-average appetite for content and expose it to more ways to purchase that content. This benefits search engines like Google, but it also benefits the content industry itself.

Of course,  as the 1925 Times quote demonstrates, the content industry hasn’t always been eager to embrace innovation. The disruptive effects of the Internet have shaken a lot of established content industry business models, which has led some of those industries into efforts at outright censorship, both through abuse of the DMCA’s take-down system and through attempts to bake censorship into the Internet itself, via new legislation and trade agreements.

Google’s report  provides some truly lurid examples of what that “abuse” looks like, such as a film company allegedly trying to get a major newspaper’s review of their film blocked in search results. Techdirt has also outlined some truly ridiculous examples of DMCA takedown requests. In view of these shameless attempts at censorship, Google’s decision to protect against DMCA abuse from both directions is prudent. It remains to be seen whether these safeguards will continue to hold, but the proliferation of information about fair use on the Internet suggests reason for optimism.

Distinguishing between fighting piracy as an industry, and fighting individual pirates, who are rarely the hardened criminals that content industry advocates paint them as, could be a major step toward a better Internet both for consumers and producers.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

How School Choice Saves Money

Education - In The News - October 17, 2014, 12:30 PM
Latest Study Do Doctors Practice Defensive Medicine? Revisited Myungho Paik, Bernard Black and David A. Hyman Featured Event October 7 Featuring Gene Healy,…

How School Choice Saves Money

Stuff We Wish We Wrote - Homepage - October 17, 2014, 12:30 PM
Latest Study Do Doctors Practice Defensive Medicine? Revisited Myungho Paik, Bernard Black and David A. Hyman Featured Event October 7 Featuring Gene Healy,…

Campbell Brown: 'A Real Threat to the Status Quo'

Education - In The News - October 17, 2014, 12:30 PM
Nina Rees writes about Campbell Brown taking on the education establishment: Campbell Brown, the journalist-turned-education-reformer, has been in the news a…
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