Later On

A blog written for those whose interests more or less match mine.

Archive for the ‘Business’ Category

Meaningful Work Boosts Happiness, Even for Lawyers

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Pick one: money or happiness. That seems to be the choice facing lawyers, according to an article by Tom Jacobs in Pacific Standard:

High-powered, high-status lawyers are less happy, and drink more heavily, than their counterparts whose jobs focus on public service.

That’s the conclusion of a new study, which analyzes a survey of nearly 6,000 American attorneys.

“It appears the downsides of performing these high-paying jobs overcame the benefits of high income,” Kennon Sheldon of the University of Missouri and Lawrence Krieger of Florida State University write in the Journal of Positive Psychology.

The researchers describe a survey distributed to members of the Bar Associations of four diverse states—two in the Southern United States, one in the north-central region, and another in the northeast. Participants were presented with a list of 27 legal jobs and asked to indicate the one that best describes their current work.

Sheldon and Krieger divided these up into three categories. “Money” jobs included corporate law, tort or malpractice litigation, tax law, and estate planning. “Service” jobs included public prosecutor or public defender, in-house legal advisors at agencies or non-profits, and those who provide legal services for the poor. The remaining jobs were simply categorized as “other.”

The 5,974 attorneys then completed a series of surveys measuring their typical emotional states and overall life satisfaction. They were also asked how much, and how often, they drink.

The researchers found significantly higher levels of overall well-being and life satisfaction in lawyers with service-oriented jobs. . . .

Continue reading.

Written by LeisureGuy

3 April 2014 at 8:28 am

Posted in Business, Daily life, Law

A “No one could possibly have foreseen” scenario, part one

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This is the first step: Congress is specifically informed that firefighter training is inadequate to fight crude-oil fires from tanker trains. So the knowledge is out there.

My guess: Nothing will be done until the inevitable catastrophic fire, and then the cry will be “No one could possibly have foreseen…” (aka “Who could have known?”)

Written by LeisureGuy

2 April 2014 at 5:14 pm

More bad news for the US as a democracy

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The Supreme Court has just lifted all limits on giving money to political parties, which will (I imagine) become even more obviously on the take and willing to sell their votes for the right price. It’s sad to see the country fail so obviously, but I do not believe the trend can be reversed.

Written by LeisureGuy

2 April 2014 at 8:30 am

Is private industry more efficient than government at running services? No.

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Mainly because a private company must always grow profits, and that leads to things like this report by Alex Leichenger in ThinkProgress:

One of the world’s largest private prison corporations already has a $45 million contract with the state of Arizona. But without amending that contract with GEO Group, Inc., a lawmaker financially tied to the prison firm inserted almost another $1 million into the state budget for it.

The House approved the budget with the $900,000 allocation to GEO, a multinational corporation based in Boca Raton, Fla. Yet after a spate of phone calls and emails, the Senate Appropriations Committee removed the funding from its version of the bill, the Arizona Republic reports.

Rep. John Kavanagh (R), chair of the House Appropriations Committee, included extra funding in the budget despite no support from the state’s Department of Corrections, which contracts with GEO. Pivotal Policy Consulting, the lobbying firm that represents GEO, requested the favor. GEO is the top financial contributor for Kavanagh, whose past work includes championing racial profiling in Arizona and criminalizing transgender people.

Caroline Isaacs, program director for the Arizona office of the American Friends Service Committee, monitors private prisons in the state. She called the attempt to include additional funding for GEO a clear violation of the state budgeting process.

“If [private prisons] feel that they’re not making enough money on their contract, then the avenue for them is to go and do a contract amendment, which they have the opportunity to do every year,” Isaacs said. “Instead of doing that, GEO Group sent their lobbyist directly to the money man in the state legislature and said ‘give us [$900,000],’ and he said, ‘OK.’ That is just not how it’s supposed to work.”
The budget is still subject to debate among both the full Senate and House.

Kavanagh claimed GEO had done the state a “big favor” by providing discounted prison facilities during the economic downturn. But a 2012 study of private prisons found that they are costing the state $3.5 million more annually than state-run prisons. [So much for free-market efficiency. - LG]

Arizona is one of a number of states in which private prisons keep their beds filled by including “occupancy requirements” akin to quotas in their contracts. For instance, GEO’s contract with Arizona mandates that least 95 percent of beds be filled. GEO and other firms have been held to these occupancy requirements even as records of abuse prompt calls to terminate their contracts, “virtually ensuring the company a profit for operating its prisons,” as the Republic describes it.

GEO, which is traded on the New York Stock Exchange, saw a net revenue of $1.52 billion in 2013, according to the company’s most recent financial report. It has recorded steady profit increases each year since earning $1.08 billion in 2010. GEO touts itself as the “world’s leading provider of correctional, detention, and community reentry services with 98 facilities, approximately 77,000 beds, and 18,000 employees around the globe.” Beyond the United States, GEO has facilities in the United Kingdom, Australia, and South Africa. The prison company’s CEO, George C. Zoley, collected $22 million in compensation between 2008 and 2012.

Written by LeisureGuy

1 April 2014 at 2:03 pm

Posted in Business, GOP, Government

The vital importance of an aggressive and investigative free press

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Although Obama really doesn’t like a free press, as shown by the way his Dept of Justice went after James Risen for publishing a whistleblower’s story, a free press that informs the public of abuses and failures in government and business is vital to a healthy society. Here are a couple of recent examples:

1. I blogged 10 days ago about how the Pentagon didn’t really want to be bothered by the effort of identifying the remains of fallen American troops who died in past wars. That report in ProPublica and on NPR has had a salutary effect: see this interesting follow-up.

2. An on-going story is the way the NHTSA failed in its duties, and the press is exposing that. For example:

Carmakers’ Close Ties to Regulator Scrutinized

U.S. Agency Knew About G.M. Flaw but Did Not Act

It’s long been known that whistleblowers and a free press help keep the government (and businesses) honest. Obama doesn’t seem to get that. His main interest so far has been to cover up government misbehavior and to intimidate the press.

UPDATE: And, of course, there’s the opposite of an investigative press.

Written by LeisureGuy

1 April 2014 at 11:27 am

Someone Else’s Debt Could Ruin Your Credit Rating

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David Dayen writes in The New Republic:

Last month, Amrit Singh, an adjunct professor at Hostos Community College in the South Bronx, received a letter from the New York City Marshal, advising him that he owed $10,000, due within 20 days. If Singh did not pay, the letter said, money would be garnished from his paycheck. “It got me worried, because I knew I didn’t owe this amount of money,” Singh said.

Singh called the Marshal’s office, and they told him Atlantic Credit, a debt collection agency, secured a judgment against him for the $10,000. Singh had never heard of Atlantic Credit and had no contact with them in the preceding months. He was also told that the original debt came from HSBC Bank, for accumulated fees and interest on an account dating back to 2008. “This was more suspicious, because I had never opened an account with HSBC, neither me nor my wife,” Singh said. His credit report showed no record of him owing money to the bank, or any other credit incident matching this level of debt.

A colleague of Singh’s, hearing the story, had a theory. “He said, they probably told an intern, ‘Amrit Singh owes this money, go look up a name.’ And the intern found me.”

That’s not far from the truth. According to statistics from the Federal Reserve, one in seven Americans is being pursued by a debt collector, up from one in 12 just ten years ago. And substantial numbers of these Americans report being hounded for debts they do not owe. A new report from the Consumer Financial Protection Bureau logged tens of thousands of complaints claiming just this—that the debt in question is simply not theirs.

Can the debt collection industry be so careless as to continually harass the wrong individuals? The more you learn about how debt collection works, the more you’re surprised that they ever find the right target in the first place.

When a consumer sustains a debt, the creditor can either attempt to personally collect it, or sell the debt to one of America’s 4,500 collection agencies. That auction process is completely broken, producing the ultimate in caveat emptor.

“Creditors provide debt buyers with almost no data, no original contract, no backup information,” said Ira Rheingold, executive director of the National Association of Consumer Attorneys. “The records are so poor that sometimes the amount of the debt is wrong too.” In a world of big data, the debt buyer market operates like it’s still the 1970s, where the commodity is merely a spreadsheet full of hints and leads, instead of reliable information about debts. The creditors, frequently big banks, try to indemnify themselves through the purchase agreement, in which they make no warranties about the legitimacy of the account information.

Debt collectors pay miniscule amounts—between four and seven cents on the dollar—for the vague information they get, so they have little incentive to ask for a more legitimate product that might cost more. They simply turn around and try to collect, making guesses based on the names and account numbers given. “We see everything. They go after people with similar names, the same name, fathers and sons getting called on each other’s debts,” said Carolyn Coffey, a Supervising Attorney at MFY Legal Services, a non-profit law firm in New York City. “They figure they bought this for so cheap, as long as they get a few positive hits, they’re going to make money.”

Because debt collectors don’t get full information, they sometimes . . .

Continue reading.

It seems obvious to me that government action is required. Perhaps the Consumer Financial Protection Bureau can promulgate some regulations, but of course the GOP in Congress is determined to destroy that agency.

Written by LeisureGuy

1 April 2014 at 10:10 am

Posted in Business, Daily life

Jobs and skills and zombies

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Paul Krugman has a good blog post:

A few months ago, Jamie Dimon, the chief executive of JPMorgan Chase, and Marlene Seltzer, the chief executive of Jobs for the Future, published an article in Politico titled “Closing the Skills Gap.” They began portentously: “Today, nearly 11 million Americans are unemployed. Yet, at the same time, 4 million jobs sit unfilled” — supposedly demonstrating “the gulf between the skills job seekers currently have and the skills employers need.”

Actually, in an ever-changing economy there are always some positions unfilled even while some workers are unemployed, and the current ratio of vacancies to unemployed workers is far below normal. Meanwhile, multiple careful studies have found no support for claims that inadequate worker skills explain high unemployment.

But the belief that America suffers from a severe “skills gap” is one of those things that everyone important knows must be true, because everyone they know says it’s true. It’s a prime example of a zombie idea — an idea that should have been killed by evidence, but refuses to die.

And it does a lot of harm. Before we get there, however, what do we actually know about skills and jobs?

Think about what we would expect to find if there really were a skills shortage. Above all, we should see workers with the right skills doing well, while only those without those skills are doing badly. We don’t.

Yes, workers with a lot of formal education have lower unemployment than those with less, but that’s always true, in good times and bad. The crucial point is that unemployment remains much higher among workers at all education levels than it was before the financial crisis. The same is true across occupations: workers in every major category are doing worse than they were in 2007.

Some employers do complain that they’re finding it hard to find workers with the skills they need. But show us the money: If employers are really crying out for certain skills, they should be willing to offer higher wages to attract workers with those skills. In reality, however, it’s very hard to find groups of workers getting big wage increases, and the cases you can find don’t fit the conventional wisdom at all. It’s good, for example, that workers who know how to operate a sewing machine are seeing significant raises in wages, but I very much doubt that these are the skills people who make a lot of noise about the alleged gap have in mind.

And it’s not just the evidence on unemployment and wages that refutes the skills-gap story. Careful surveys of employers — like those recently conducted by researchers at both M.I.T. and the Boston Consulting Group — similarly find, as the consulting group declared, that “worries of a skills gap crisis are overblown.”

The one piece of evidence you might cite in favor of the skills-gap story is the sharp rise in long-term unemployment, which could be evidence that many workers don’t have what employers want. But it isn’t. At this point, we know a lot about the long-term unemployed, and they’re pretty much indistinguishable in skills from laid-off workers who quickly find new jobs. So what’s their problem? It’s the very fact of being out of work, which makes employers unwilling even to look at their qualifications.

So how does the myth of a skills shortage not only persist, but remain part of what “everyone knows”? Well, there was a nice illustration of the process last fall, when . . .

Continue reading.

Written by LeisureGuy

31 March 2014 at 1:10 pm

Posted in Business, Daily life

Reforming high-frequency trading

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The NY Times has a long extract from a new book by Michael Lewis on high-frequency trading and the technology behind it. I don’t fully follow all the explanations (in part, I suspect, because Michael Lewis doesn’t fully understand what he’s writing about), but it is interesting about how untrustworthy the financial service industry is. They often simply lie about what they’re doing.

Here’s a review of the book.

Written by LeisureGuy

31 March 2014 at 9:52 am

Posted in Business, Technology

Permanently Temporary: The Truth About Temp Work in America

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Things in the US are not good, and yet the government cannot take effective (Keynesian) action. The government is blocked from acting in the general welfare—I’m speaking of the dynamics of the current Congress and the one immediately preceding—and the amount of economic suffering and hardship continues to increase. In the past, this combination has not worked out well in the long run.

Take a look at this article by Michael Grabell in the Pacific Standard.

Written by LeisureGuy

29 March 2014 at 12:59 pm

Useful background reading regarding the Hobby Lobby lawsuit

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Nina Martin of ProPubica has compiled an excellent set of annotated links. Check out the article at Pacific Standard. Interesting how a corporation believes that it has the right to decide medical questions between a woman and her doctor, overriding the doctor’s authority (and mission). And it’s the corporation, not the owners, who would pay for contraception: a distinction whose utility is more appreciated in the other direction, in which it is the corporation, not the owners, who is held liable, fined, and otherwise punished for breaking the law. In that case, the owners are quick to draw a sharp distinction between owner and corporation. Well, that sharp distinction cuts both ways.

Written by LeisureGuy

29 March 2014 at 12:44 pm

Hobby Lobby thoughts

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The articles of incorporation not only create a legal “person,” they erect an impermeable wall between the shareholders/owners and the outside world: lawsuits, judgments, and penalties cannot reach the shareholders directly, stopping at the corporation: that’s the idea of limited liability.

That protection is why we have corporations, and that protection seems to define a discontinuity or gap between the shareholders/owners and the corporation, I would argue that this same wall is/should be impermeable in the other direction: stopping the religious beliefs of the owners/shareholders from being expressed in, for example, obedience to laws regarding healthcare of corporate employees  of the corporation. The corporate “person” is not only without a soul or a religion, that “person” is (theoretically) required to obey the law of the land. The corporation, having no religion in itself, also is free of religious doctrines (because otherwise a corporation jointly and equally owned by a Muslim, a Jew, a Hindu, a Quaker, and a Fundamentalist Christian zealot (however unlikely such a group of owners might be) would be pulled this way and that.

So the only finding that makes sense to me is that corporate entities are required to obey the law of the land (e.g., cover contraceptives in their healthcare plans), regardless of the religious beliefs of the current owners. If religious beliefs trump the law, then I’m sure we’ll be seeing very many interesting and unusual religious beliefs appear. (The test of a religious belief is, so far as I can tell, is to ask, “Do you truly and religiously believe that?”, with a positive answer being the defining proof. Example: Scientology.)

Written by LeisureGuy

25 March 2014 at 11:21 am

Posted in Business, Law, Religion

Selling potent neurotoxins to consumers with no regulation or oversight

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Sometimes it seems very much as though people lack common sense. Matt Richtel writes in the NY Times:

A dangerous new form of a powerful stimulant is hitting markets nationwide, for sale by the vial, the gallon and even the barrel.

The drug is nicotine, in its potent, liquid form — extracted from tobacco and tinctured with a cocktail of flavorings, colorings and assorted chemicals to feed the fast-growing electronic cigarette industry.

These “e-liquids,” the key ingredients in e-cigarettes, are powerful neurotoxins. Tiny amounts, whether ingested or absorbed through the skin, can cause vomiting and seizures and even be lethal. A teaspoon of even highly diluted e-liquid can kill a small child.

But, like e-cigarettes, e-liquids are not regulated by federal authorities. They are mixed on factory floors and in the back rooms of shops, and sold legally in stores and online in small bottles that are kept casually around the house for regular refilling of e-cigarettes.

Evidence of the potential dangers is already emerging. Toxicologists warn that e-liquids pose a significant risk to public health, particularly to children, who may be drawn to their bright colors and fragrant flavorings like cherry, chocolate and bubble gum.

“It’s not a matter of if a child will be seriously poisoned or killed,” said Lee Cantrell, director of the San Diego division of the California Poison Control System and a professor of pharmacy at the University of California, San Francisco. “It’s a matter of when.”

Reports of accidental poisonings, notably among children, are soaring. . .

Continue reading.

Written by LeisureGuy

24 March 2014 at 10:32 am

Posted in Business, Government, Health

Breaking free of cubicle-land in office environments

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The open-space idea of putting knowledge workers in cubicles—ostensibly to foster communication, actually to save money—has repeatedly been shown to reduce productivity and job satisfaction. Some few corporations are starting to wake up. Dezeen has a very interesting interview with Clive Wilkinson, who designed Google’s (non-cubicle) office space:

Clive Wilkinson, the architect behind the office design at Google‘s Silicon Valley headquarters, tells us how he convinced the internet giant to move away from “humiliating, disenfranchising and isolating” workers’ cubicles (+ transcript).

Speaking to Dezeen during this year’s Design Indaba event in Cape Town,Wilkinson recounted how he and his team had to persuade the tech company to switch from a typical cubicle layout to a more transparent workspace when the firm first worked on offices for Google in 2005.

“We had to do quite a bit of convincing to make the founders move away from their cubicle model,” he said. “We managed to turn all of their enclosed rooms into glass rooms.”

Google now commissions bespoke designs for each of its outposts around the world, such as its Tel Aviv office full of orange trees and its London headquarters that features balcony gardens and allotments.

Wilkinson said that California is still home to the most exciting office interiors right now, because tech companies like AppleTwitter andAirbnb are “phenomenally rich”, but that there’s still room for more workspace innovation there.

“The San Francisco and Silicon Valley area of America is a massive test bed of new working but it’s not completely radical yet,” he said.

However, Wilkinson believes that more American companies need to catch on to the way these firms design their workspaces, as the majority of them are still using the cubicle offices he detests.

“I’d say 75 to 80 percent of America is cubicle land,” he said. “Cubicles are the worst – like chicken farming. They are humiliating, disenfranchising and isolating. So many American corporations still have them.”

He contrasts these American firms with Australian corporations, like the Macquarie investment bank he designed the One Shelley Street offices in Sydney for in 2009. He claims their smaller size makes them more conscious about the quality of workspaces for employees.

“American businesses are very conservative and issues of real estate don’t tend to get the attention of the CEO,” Wilkinson explained. “Conversely in Australia, where corporations are not that big, real estate does get the attention of the CEOs. They are mindful of the massive impact that an environment can have on productivity and effectiveness of the company and are prepared to take it pretty seriously.”

Wilkinson said that he enjoys designing interiors because they have more effect on the users than a building’s exterior.

“In our design practice we are fundamentally trying to address psychological issues,” Wilkinson told Dezeen. “One of the reasons I really like workplaces and interiors is that the impact on humanity is much more powerful than dealing with inert architectural shells, or the decorative outside dress of a building – which frankly is what most architects do.”

He went on to describe the current rift between external and internal design, which arises because a building’s use is often unknown or subject to change while it’s being designed, so the interior isn’t considered until later on.

“The content in the interiors of buildings has become banal,” he asserted. “Interiors have become the element of human culture than you insert into the inert box of architecture.”

“There’s a notion that you can’t build big buildings for owners who have highly specific needs because needs change and therefore that building will be compromised by its specificity,” he added. “So architects are placed in a market of building shells.”

Read the full transcript of the interview below.

Claire Thomas: What are you working on right now?

Clive Wilkinson: The BMW Campus masterplan in Munich is the most fascinating because we aren’t know for urban design. It’s a huge honour and incredibly weird that we’ve been invited to enter an urban design competition with massive car parks and buildings and traffic – we’re not known for that at all. Fortunately I have some background in that before I got pigeonholed as an interiors guy. When I worked in London we did work on urban design scale projects back in the 1980s.

Claire Thomas: You trained as an architect. What got you interested particularly in inside spaces? . . .

Continue reading. Lots of photos at the link.

Written by LeisureGuy

24 March 2014 at 10:03 am

Posted in Business, Daily life

How did Sweden take over pop music?

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Very interesting example of unintended consequences and the success of some government programs. Whet Moser writes at Pacific Standard:

At some point over the last 15 years—sometime, say, between the 1999 release of “I Want It That Way” by the Backstreet Boys and last year’s “Roar” by Katy Perry—it became an inescapable fact that if you want to understand American pop music, you pretty much have to understand Sweden.

Songwriters and producers from Stockholm have buttressed the careers of Lady Gaga, Madonna, Usher, Avril Lavigne, Britney Spears, The Backstreet Boys, Pitbull, Taylor Swift, One Direction, Maroon 5, Kelly Clarkson, and any number of other artists you’ve probably listened to while dancing, shopping, making out, or waiting on hold over the past decade. (And it’s not just American pop music that has Scandinavian fingerprints all over it: When Azerbaijan won the Eurovision contest in a 2011 upset, they did it with a song written for them by two Swedes.)

If Americans are aware of this phenomenon, it is probably because they’ve heard about the legendary Swedish producer and songwriter Max Martin. There are any number of ways to express Martin’s ubiquity, but here’s one: From 2010 to 2011, the pop idol Katy Perry spent an unprecedented 69 consecutive weeks in the Billboard top 10, surpassing the previous record-holder, the 1990s Swedish group Ace of Base, by four months. But the milestone was far more of a testament to Martin’s staying power than Perry’s: Not only did he help produce and write all but one of Perry’s record-breaking string of hits, but he began his career as a producer for Ace of Base. Max Martin has produced more number-one songs than anyone besides George Martin, the so-called fifth Beatle.

But Max Martin is not some kind of unicorn. Other Swedish producer-songwriters boast only moderately less impressive résumés: Anders Bagge, Andreas Carlsson, and Rami Yacoub, to name just a few, have likewise worked with incredible rosters of American pop stars. And even focusing on this shortlist of talent obscures a much larger infrastructure at work.

Sweden, and in particular Stockholm, is home to what business scholars and economic geographers call an “industry cluster”—an agglomeration of talent, business infrastructure, and competing firms all swirling around one industry, in one place. What Hollywood is to movies, what Nashville is to country music, and what Silicon Valley is to computing, Stockholm is to the production of pop. In fact, Sweden is the largest exporter of pop music, per capita, in the world, and the third largest exporter of pop overall. And in recent years, the country has seized not just the message, but the medium as well: As the industry moves toward a distribution model that relies on streaming music services, the Stockholm-born Spotify is a dominant player, with 24 million users per month.

So how did Sweden, a sparsely populated Nordic country where it’s dark for much of the year, become a world capital of popular music? Rarely does such a complex question lead to such a satisfying answer: Three-quarters of a century ago, . . .

Continue reading.

Written by LeisureGuy

24 March 2014 at 8:56 am

The Indian sanitary pad revolutionary

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A totally fascinating article in the BBC News Magazine by Vibeke Venema. Although there is much struggle, there are no villains. Well worth reading. It begins:

Arunachalam Muruganantham’s invention came at great personal cost – he nearly lost his family, his money and his place in society. But he kept his sense of humour.

“It all started with my wife,” he says. In 1998 he was newly married and his world revolved around his wife, Shanthi, and his widowed mother. One day he saw Shanthi was hiding something from him. He was shocked to discover what it was – rags, “nasty cloths” which she used during menstruation.

“I will be honest,” says Muruganantham. “I would not even use it to clean my scooter.” When he asked her why she didn’t use sanitary pads, she pointed out that if she bought them for the women in the family, she wouldn’t be able to afford to buy milk or run the household.

Wanting to impress his young wife, Muruganantham went into town to buy her a sanitary pad. It was handed to him hurriedly, as if it were contraband. He weighed it in his hand and wondered why 10g (less than 0.5oz) of cotton, which at the time cost 10 paise (£0.001), should sell for 4 rupees (£0.04) – 40 times the price. He decided he could make them cheaper himself.

He fashioned a sanitary pad out of cotton and gave it to Shanthi, demanding immediate feedback. She said he’d have to wait for some time – only then did he realise that periods were monthly. “I can’t wait a month for each feedback, it’ll take two decades!” He needed more volunteers.

When Muruganantham looked into it further, he discovered that hardly any women in the surrounding villages used sanitary pads – fewer than one in 10. His findings were echoed by a 2011 survey by AC Nielsen, commissioned by the Indian government, which found that only 12% of women across India use sanitary pads.

Muruganantham says that in rural areas, the take-up is far less than that. He was shocked to learn that women don’t just use old rags, but other unhygienic substances such as sand, sawdust, leaves and even ash.

Women who do use cloths are often too embarrassed to dry them in the sun, which means they don’t get disinfected. Approximately 70% of all reproductive diseases in India are caused by poor menstrual hygiene – it can also affect maternal mortality.Finding volunteers to test his products was no mean feat. His sisters refused, so he had the idea of approaching female students at his local medical college. “But how can a workshop worker approach a medical college girl?” Muruganantham says. “Not even college boys can go near these girls!” . . .

Continue reading. The story is very satisfying. I was particularly struck by this:

Muruganantham seemed set for fame and fortune, but he was not interested in profit. “Imagine, I got patent rights to the only machine in the world to make low-cost sanitary napkins – a hot-cake product,” he says. “Anyone with an MBA would immediately accumulate the maximum money. But I did not want to. Why? Because from childhood I know no human being died because of poverty – everything happens because of ignorance.”

He believes that big business is parasitic, like a mosquito, whereas he prefers the lighter touch, like that of a butterfly. “A butterfly can suck honey from the flower without damaging it,” he says.

As readers know, I believe that corporations suffer from perverse incentives (maximize profit above all), which leads them to do despicable things (cf. Duke Energy) to their employees and their communities and (all too often) their customers (cf. Ford knowingly building cars that were fiery death traps because it would be somewhat more profitable than building a safe car). The thinking (if one can call it that) is:

1. Profit!
2. ???
3. A beneficent and happy life

This guy sees clearly that profit may not be the essential ingredient. As it says, one can achieve the benefit without damaging lives.

Plus, of course, I resonate to the idea of approaching a problem rationally, ignoring taboos and conventions created by ignorance. What a guy!

UPDATE: The more I thought about it, the more I liked the marked transformation from a small impetus—look, for example, at the changes in his own village. Or this:

He was once asked whether receiving the award from the Indian president was the happiest moment of his life. He said no – his proudest moment came after he installed a machine in a remote village in Uttarakhand, in the foothills of the Himalayas, where for many generations nobody had earned enough to allow children to go to school.

A year later, he received a call from a woman in the village to say that her daughter had started school. “Where Nehru failed,” he says, “one machine succeeded.”

Through one small effort—and the decision to have as a goal the greatest use rather than the maximum profit—enormous changes ensue: a landslide starting from one pebble (though the pebble was clearly difficult to dislodge).

UPDATE 2: The unexpected cultural changes that follow from the introduction of small (and inexpensive) manufacturing of sanitary pads reminded me of something I had read about earlier: how the invention of the bicycle had unexpected consequences. Peter Barnes wrote the following letter to The Guardian:

The work of James Tanner (obituary, 15 October) is replete with thought-provoking observations. His time as a pupil at Marlborough college appears, later, to have afforded him access to the records of the medical officer and the natural science master dating from 1873. Using these as a baseline, Tanner showed how the average height of the boys when aged sixteen and a half had risen by half an inch a decade over an 80-year period. In Foetus Into Man (1978), he suggested that this “secular trend” was in part a consequence of improved nutrition, but also attributable to genetic factors. The latter included the increased incidence of procreation outside the village community, a key factor in which was the introduction of the bicycle.

Written by LeisureGuy

21 March 2014 at 4:04 pm

Posted in Business, Daily life, Health

The FDA is badly broken and also underfunded: Sunscreens edition

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I wish Obama were more interested in fixing the Executive Branch of the government. He seems mainly focused on enabling it to continue as it is (cf. NSA, CIA, FDA, SEC, DOJ, and so on). Read Brady Dennis’s article in the Washington Post:

The tourists flocking to the French Riviera or Spain’s Costa del Sol this summer will slather on sunscreen containing the latest ingredients for protecting against the sun’s most harmful ultraviolet rays.But American beachgoers will have to make do with sunscreens that dermatologists and cancer-research groups say are less effective and have changed little over the past decade.

That’s because applications for the newer sunscreen ingredients have languished for years in the bureaucracy of the Food and Drug Administration, which must approve the products before they reach consumers.“We have a system here that’s completely broken down, and everybody knows that it has broken down,” said Wendy Selig, president of the Melanoma Research Alliance, the largest private funder of melanoma research.Her group and others, along with dermatologists and sunscreen manufacturers, have joined forces to make a public push for the FDA to approve at least some of the backlogged applications.The agency has not expanded its list of approved sunscreen ingredients since 1999. Eight ingredient applications are pending, some dating to 2003. Many of the ingredients are designed to provide broader protection from certain types of UV rays and were approved years ago in Europe, Asia, South America and elsewhere.

The FDA noted that U.S. consumers “have access to a great number of sunscreen products,” but said in a statement to The Washington Post that it recognizes the public health importance of sunscreen and has prioritized its review of the long-pending applications. The agency said “it is proceeding as quickly as practicable given available review resources and competing public health responsibilities.”

In the meantime, advocates for newer sunscreens have grown increasingly frustrated.

“These sunscreens are being used by tens of millions of people every weekend in Europe, and we’re not seeing anything bad happening,” said Darrell S. Rigel, clinical professor of dermatology at New York University and past president of the American Academy of Dermatologists. “It’s sort of crazy. . . . We’re depriving ourselves of something the rest of the world has.”

Even some FDA officials have expressed frustration about how the applications have become mired in a complex regulatory regime, adopted more than a decade ago, that was originally intended to simplify approvals for over-the-counter products used in other countries for at least five years.

“This is a very intractable problem. I think, if possible, we are more frustrated than the manufacturers and you all are about this situation,” Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research, told lawmakers in November when asked about the agency’s sluggish over-the-counter reviews.

Part of the holdup, she said, is that . . .

Continue reading. Maybe sunscreen makers are lucky: scientists who wanted to study the effectiveness of marijuana as a treatment for PTSD waited 14 years to get approval—14 years.

Increasingly the US government seems to be badly broken, beholden to corporations and big money and unable to function.

Written by LeisureGuy

21 March 2014 at 1:09 pm

Tech companies are like other companies: They will do anything that increases profits

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David Dayen provides examples in Salon:

To really understand the extent of Google and Apple’s innovative zeal, you may want to look past their groundbreaking products – and more at their tax avoidance strategies. In a new scheme that defies belief, some of the nation’s top tech giants are managing to evade taxation on money by parking it overseas – and then somehow taking government paymentson it.

Though the rest of the business sector had a head start, tech firms have begun to lobby Washington with more persistence over the past few years; the top 10 spent more than $61 million in 2013. The more hopeful among us might believe this shift could possibly produce more beneficial results for the public. (After all, Google’s motto is “don’t be evil,” right?)

But while it’s true that, in certain discrete areas, tech lobbying has yielded positive results — like when companies aided grass-roots efforts to stop Internet censorship legislation sought by Hollywood — in the vast majority of cases, Silicon Valley wants what the rest of our multinational conglomerates want: low taxes and cheap labor. And they’ve been at the forefront of efforts to ensure that.

Take a look at the recent Bloomberg report on companies stockpiling cash in offshore tax havens to avoid higher U.S. rates, for example. (Though the new FiveThirtyEight.comdownplayed the significance of this buildup, in actuality it has increased at a fairly steady 10-15 percent rate since the start of the Great Recession.) The tech sector has led the way on this, moving their patents and other intellectual property to low-tax countries to give the appearance that their profits have been earned offshore.

According to Securities and Exchange Commission filings, Apple, Microsoft and IBM accelerated their overseas profit hoarding in 2013 more than their counterparts, adding $37.5 billion to the pile. Over the past three years, Microsoft’s cash stash has more than doubled, and Apple’s has quadrupled. In all, seven tech companies – the three mentioned above, along with Cisco Systems, Oracle, Google and Hewlett-Packard – have $341.3 billion sitting in offshore accounts. At current tax rates, the companies would have to pay $119.45 billion of that to the IRS if they repatriated it. Much of this money is held insegregated U.S. bank accounts, solely for the purpose of avoiding taxes by nominally keeping it offshore.

Sure enough, tech firms are among the companies lobbying for a repatriation tax holiday, which would allow them to return that money home at ultra-low rates. The LIFT Coalition(short for Let’s Invest for Tomorrow), run by former Obama administration communications director Anita Dunn, advocates for the repatriation holiday, and includes Intel, Cisco, Hewlett-Packard, the Semiconductor Industry Association, and “TechNet,” a separate lobbying coalition that counts as its members Google and Facebook.

These lobbying coalitions claim that repatriating the money will allow companies to invest and spur economic recovery, although the last repatriation tax holiday, in 2004, did nothing of the sort. The top 15 companies that made use of that holiday to move money home actually cut 20,000 jobs in the aftermath, while increasing their executive compensation and stock buybacks, according to a report from the Senate Permanent Subcommittee on Investigations (Hewlett-Packard and IBM were among the 15 companies benefiting the most). Sadly, both the recent Republican tax reform proposal and the Obama administration’s budget call for a repatriation tax holiday along the lines of the lobbying coalition’s wishes, so their efforts could bear fruit.

But it’s actually worse than all this. A report from the Bureau on Investigative Journalismshows that these tech firms are actually taking government payments on the money they have parked overseas to avoid taxation. That’s because that money isn’t sitting under a mattress somewhere in Bermuda or the Cayman Islands; it’s invested, and the No. 1 investment these firms use is the ultra-safe, ultra-liquid instrument of U.S. government debt.

SEC filings show that Apple, Microsoft, Google and Cisco have $163 billion invested in various forms of interest-bearing U.S. debt. If they were a country (Silicon Valleyistan), that would be the 14th-largest holding of our debt in the world, more than the sovereign wealth funds of Singapore and Norway. Despite the investments in things like Treasury notes and agency debt, the money is still considered offshore, avoiding taxation even as it collects interest from the U.S. government. The annual interest payout to just these four firms is$326 million.

Silicon Valley has mobilized to ensure this gravy train continues into perpetuity. . .

Continue reading. He also describes the coordinated efforts of tech companies to keep employee salaries low by ensuring that the free market did not apply. His concluding paragraph:

None of this is particularly surprising. Tech firms are in the business of making money, regardless of the shiny products and Web apps and social media diversions that supply their revenue stream. They cut all the corners that the rest of corporate America cuts to maximize their profits, skirting the edges of the law and sometimes going over it. You may not want to believe that the companies that give you the iPad and help you in your search for cat videos operate like a two-bit hustler, stealing the wages of employees and setting up dummy tax shelters. But that’s the sad reality.

Written by LeisureGuy

21 March 2014 at 12:49 pm

Posted in Business, Law, Technology

Duke Energy Caught Intentionally Dumping 61 Million Gallons Of Coal Waste Into North Carolina Water

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Perhaps it’s time to disincorporate Duke Energy and send its executives to prison. Emily Atkin writes at ThinkProgress:

North Carolina regulators on Thursday cited Duke Energy for illegally and deliberately dumping 61 million gallons of toxic coal ash waste into a tributary of the Cape Fear River, which provides drinking water for several cities and towns in the state.

The incident marks the eighth time in less than a month that the company has been accused of violating environmental regulations. The North Carolina Department of Environment and Natural Resources (DENR) said Duke — notorious for the February Dan River disaster which saw 82,000 tons of coal ash released into state waters — was taking bright blue wastewaterfrom two of its coal ash impoundments and running it through hoses into a nearby canal and drain pipe.

Duke is reportedly permitted to discharge treated wastewater from the ash ponds into the canal, but only if they are filtered through so-called “risers,” pipes that allow heavier residue in the water to settle out. DENR told ABC News on Thursday that Duke’s pumping bypassed the risers.

“We’re concerned with the volume of water that was pumped and the manner it was pumped,” DENR Communications Director Drew Elliot told ABC. “It did not go through the treatment facility as it should have.”

Duke’s most recent incident was discovered after the environmental group Waterkeeper Alliance last week released aerial surveillance photos taken from a fixed-wing aircraft that showed Duke workers pumping wastewater from the two toxic coal ash lagoons into a canal.

Waterkeeper Alliance tried to go to the source of the pollution via boat but were warned off by plant employees and a policeman, so they resorted to aerial surveillance, as seen in this clip from the Rachel Maddow Show on MSNBC. . .

Continue reading. There’s more to the story and the video clip is interesting.

Written by LeisureGuy

21 March 2014 at 12:07 pm

And, speaking of banksters, look at what Goldman Sachs is up to

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Jesse Eisinger reports at ProPublica:

The “revolt of the Muppets” is heating up.

That’s how a Georgetown finance professor, James J. Angel, characterizes the combat by him and other investors over Goldman Sachs’ takeover of a hotel company a few years ago. (The phrase comes from a former Goldman employee, Greg Smith, who wrote that Goldman bankers referred to clients as the famous Henson puppets, a charge the bank disputed.)

The fight raises such a cornucopia of financial issues that it could shoulder an entire business school course. The holders of preferred stock in the company have taken to commenting to the Securities and Exchange Commission in outrage. Professor Angel accuses Goldman of multiple securities law violations. In essence, the question is: In these post-financial crisis days, what constitutes improper conflicts of interest?

First, some back story (and a friendly warning to readers: Goldman plays more roles in this than Joanne Woodward in “The Three Faces of Eve.”)

In 2007, a Goldman private equity fund called Whitehall took a company that runs franchised motels, like Residence Inn, private in a $2.2 billion transaction. It renamed the company W2007 Grace Acquisition. A Goldman entity, Goldman Sachs Mortgage Company, was the main lender for the leveraged buyout. Grace is run by current Goldman employees.

Goldman did not buy the publicly traded preferred shares, however. . .

Continue reading. Fascinating.

Written by LeisureGuy

19 March 2014 at 1:14 pm

Posted in Business

What’s happening with the banksters?

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First, the DOJ is being pushed to extradite Swiss bankers who have broken the law. (So far, they haven’t even tried this approach despite the bankers being indicted.)

Second, Bryce Covert writes at ThinkProgress on how the DOJ’s own Inspector General found that the DOJ failed to hold banksters accountable. (I hold Eric Holder, former Wall Street lawyer, as being in part responsible for the inaction.)

The Department of Justice (DOJ) fell down on many of its efforts to hold Wall Street accountable for mortgage fraud after the crisis, according to a new audit from the U.S. Department of Justice Office of the Inspector General (OIG).

The DOJ promised the public that it would place a priority on going after mortgage fraud. But the report finds that “DOJ did not uniformly ensure that mortgage fraud was prioritized at a level commensurate with its public statements.” One telling example is that the Federal Bureau of Investigation (FBI) ranked mortgage fraud as the lowest threat in its lowest crime category. The OIG also visited FBI field offices in Baltimore, Los Angeles, Miami, and New York and found that either it was a low priority or not even listed as a priority. Meanwhile, the FBI got $196 million in funding to investigate mortgage fraud between 2009 and 2011, yet the number of agents doing the investigation decreased in the same time, as did the pending investigations.

On top of these findings, the OIG reports that data was so poorly collected at the DOJ that it’s difficult for it to assess what was going on. And this bad data also led to the department misleading about its efforts to the public. In October of 2012, Attorney General Eric Holder announced a press conference that his department had filed 110 federal civil cases that involved more than 73,000 homeowner victims and total losses of more than $1 billion. When the OIG followed up about these numbers, it became clear that there were significant errors with them — the total losses, for example, were $95 million, 91 percent than originally claimed. Yet the department kept referencing these numbers even after it realized its mistakes.

The report does have some praise for the DOJ. It offers two examples of where the department prioritized going after mortgage fraud: “the Criminal Division’s leadership of its mortgage fraud working group and the FBI and USAOs’ participation on more than 90 local task forces and working groups,” it notes.

A spokeswoman for the DOJ also pointed to the fact that the number of mortgage fraud indictments almost doubled between 2009 and 2011 and that the number of convictions rose by more than 100 percent, saying, “As the report itself notes, even at a time of constrained budget resources, the department has dedicated significant manpower and funding to combating mortgage fraud.”

But the audit’s findings are disturbing given the scope of fraud and how little justice homeowners have seen since the crisis. Prosecutions for financial fraud hit a 20-year low in 2011, in the wake of a crisis created by risk-taking on Wall Street. Lawmakers continually prodded the DOJ over what they felt was an attitude that banks were “too big to jail,” “too big for trial,” or that they had a “get out of jail free” card.

Meanwhile, the national mortgage settlement struck in 2012 over servicing abuses has brought very little relief for homeowners. Two years later, most banks are flouting the terms, as only two were fully in compliance, and servicers are still rampantly abusing homeowners. Meanwhile, little of the money set aside to help homeowners dealing with foreclosure has actually reached them, and some of the checks were so small homeowners refused to cash them.

Other efforts to hold Wall Street accountable after a crisis that took as much as $14 trillion — or perhaps even more — out of the economy haven’t produced many results. Just one financial executive has been held accountable, while most banks have walked away with settlements that aren’t nearly as large as they at first may appear. The Securities and Exchange Commission has won back just $2.7 billion in fines, penalties, and disgorged profits, and while it started demanding that banks admit to wrongdoing in settlements, there is evidence it may be throwing the towel in on prosecutions related to the financial crisis.

Written by LeisureGuy

19 March 2014 at 10:18 am


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