Law

1. “For over a century, incomes across states converged at a rate of 1.8% per year…The convergence rate from 1990 to 2010 was less than half the historic norm, and in the period leading up to the Great Recession there was virtually no convergence at all.”

2. After subtracting housing costs, janitors in NYC now earn less than they do in the Deep South.  This was not the case for most of American history.

3. For NYC janitors, housing costs measure at 52% of their income.

4. Income differences across states are increasingly capitalized into housing prices.

5. “…income convergence declined the most in areas with [land] supply constraints.”

6. “Had [cross-state] convergence continued apace through 2010…the increase in hourly wage inequality from 1980 to 2010 would have been 8% smaller.”

That is from a new NBER working paper, “Why has Regional Income Convergence in the US Declined?”, by Peter Ganong and Daniel W. Shoag.  Here are earlier ungated versions.

Note that this paper contains “…the first national panel measure of land use regulations in the US.”

In the place of U.S. support, Japan has offered to step in.

“Japan is the only state willing to help India in its Indian Ocean project to develop islands there,” said Abhijit Singh, head of the Maritime Policy Initiative at the Observer Research Foundation, a New Delhi think tank. The reason, he added, is that other nations—notably the U.S.—consider offering such help too provocative to China.

Here is the full WSJ story.

Here is the government’s own answer:

No.  The President’s clemency power is conferred by Article II, Section 2, Clause 1 of the Constitution of the United States, which provides:  “The President . . . shall have Power to grant Reprieves and Pardons for Offenses against the United States, except in Cases of Impeachment.”  Thus, the President’s authority to grant clemency is limited to federal offenses and offenses prosecuted by the United States Attorney for the District of Columbia in the name of the United States in the D.C. Superior Court.  An offense that violates a state law is not an offense against the United States.  A person who wishes to seek a pardon or a commutation of sentence for a state offense should contact the authorities of the state in which the conviction occurred.  Such state authorities are typically the Governor or a state board of pardons and/or paroles, if the state government has created such a board.

Solve for the equilibrium!

I thank J. for a relevant pointer.

I would like to see building deregulators pay more attention to this aspect of the problem:

The next step would be transferring ownership of these assets to what Detter and Fölster call an “urban wealth fund”. Ideally, all publicly owned assets in a given city would be placed in the fund, regardless of whether they technically belong to the county, the city, the school system, the state or some other entity. The local governments would each have shares in the fund proportionate to the value of the assets they contributed. These shares would be reported as assets on the municipal balance sheets.

Independent managers with experience in real estate and finance would be charged with maximising the value of the portfolio. Cities would receive dividends from their stakes in these commercial properties and have the option to borrow against or sell their shares if desperate for cash.

Public officials would then have to decide whether it makes sense to pay fair market rents to stay in their properties. Moving offices might be inconvenient for government workers but the potential gains for taxpayers and citizens who depend on government services would be far greater. Leasing space in subway stations to shops might detract from the “historic” character of the US’s barbarous public transit systems, but the revenues could fund needed improvements, such as ventilation, without the need for debt or higher passenger fares.

That is from Matt Klein at the FT.  Note that profit maximization does not have to be the sole goal of such funds.

NYC pet-sitting is now illegal

by on July 22, 2017 at 1:20 pm in Law | Permalink

Pet lovers are barking mad over a little-known city rule that makes dog-sitting illegal in New York.

Health Department rules ban anyone from taking money to care for an animal outside a licensed kennel — and the department has warned a popular pet-sitting app that its users are breaking the law.

“The laws are antiquated,” said Chad Bacon, 29, a dog sitter in Greenpoint, Brooklyn, with the app Rover. “If you’re qualified and able to provide a service, I don’t think you should be penalized.”

Here is the full story, via the excellent Mark Thorson.  Ostensibly the purpose of the regulation is to ensure the health and safety of pets.

A Toronto man who spent $550 building a set of stairs in his community park says he has no regrets, despite the city’s insistence that he should have waited for a $65,000 city project to handle the problem. The city is now threatening to tear down the stairs because they were not built to regulation standards.

Retired mechanic Adi Astl says he took it upon himself to build the stairs after several neighbours fell down the steep path to a community garden in Tom Riley Park, in Etobicoke, Ont. Astl says his neighbours chipped in on the project, which only ended up costing $550 – a far cry from the $65,000-$150,000 price tag the city had estimated for the job.

“I thought they were talking about an escalator,” Astl told CTV News Channel on Wednesday.

Astl says he hired a homeless person to help him and built the eight steps in a matter of hours.

Astl’s wife, Gail Rutherford, says the stairs have already been a big help to people who routinely take that route through the park. “I’ve seen so many people fall over that rocky path that was there to begin with,” she said. “It’s a huge improvement over what was there.”

The city says the stairs are unsafe and has cordoned them off, banning their use:

“We just can’t have people decide to go out to Home Depot and build a staircase in a park because that’s what they would like to have.”

Here is the article, with photos, via Rob Gray.

The largest city in North America has done away with one of the biggest hidden subsidies for driving: minimum parking requirements.

Mexico City eliminated requirements that force developers to build a minimum number of parking spaces in each project. The city will instead cap the number of parking spaces allowed in new development, depending on the type and size of the building. Existing parking spaces can also be converted to other uses.

Mexico City Mayor Miguel Mancera signed the new regulations into effect last week.

The policy change applies to every land use and throughout the entire city of 8.8 million residents. It promises to make housing more affordable, reduce traffic, and improve air quality.

…The old rules mandated parking even though only about 30 percent of Mexico City residents own cars and the city has a well-developed subway system.

There are now parking maximums in place instead of minimums…

Within the central city, the new rules also require developers to pay a fee if they build more than 50 percent of the maximum parking allowed…

Revenues from the parking fee will be used to improve transit and subsidize housing.

Here is the story, via John Chamberlin.  Here is my earlier NYT column on this topic.

As their budgets strain, communities have begun questioning how much money and effort they should be spending to deal with overdoses, especially in cases involving people who have taken near-fatal overdoses multiple times. State and local officials say it might be time for “tough love”: pushing soaring medical costs onto drug abusers or even limiting how many times first responders can save an individual’s life.

“It’s not that I don’t want to treat overdose victims, it’s that the city cannot afford to treat overdose victims,” said Middletown Council Member Daniel Picard, noting this industrial town in northern Butler County might have to raise taxes in response to the crisis.

Often, the only thing separating whether an overdose victim goes to the hospital instead of the morgue is a dose of naloxone, also known by the brand name Narcan, a medication that can reverse the effects of opioid overdoses.

Two doses of an injectable form of naloxone, Evzio, cost $4,500, up from $690 in 2014. The price of other forms of the drug, including the nasally administered Narcan, typically range from $70 to $150 per dose, officials say.

…Here in Ohio, first responders say it’s not uncommon for overdose victims to have previously been revived with naloxone at least a half-dozen times.

…Picard, the council member, has proposed a controversial three-strikes policy in which first responders wouldn’t administer Narcan to repeated overdose victims.

Here is the Tim Craig at WaPo story.  I do not know what is the proper response to such opioid cases, or how much money should be spent.  I do know that somewhere, somehow a line has to be drawn.  And if you are reading a discussion of health care policy that does not acknowledge such a line, and set out possible standards for it, beware of sophistry and illusion.

An Ohio judge has ruled that data from a pacemaker can be used in court.

Defendant Ross Compton, who faces aggravated arson charges, claims he was woken by a fire at home, packed a case, broke a window and threw out the bag.

A cardiologist told police his explanation was “highly improbable” based on his heart rate and cardiac rhythms at the time.

Mr Compton’s lawyer said allowing pacemaker evidence expanded government snooping into private data.

Here is the full story, and here is an appalling add-on:

According to local paper Journal News, Judge Charles Pater said: “There is a lot of other information about things that may characterise the inside of my body that I would much prefer to keep private rather than how my heart is beating. It is just not that big of a deal.”

Via Michelle Dawson.  And here is an article about retail interference with brain implants.

United States v. Nixon

by on July 13, 2017 at 1:54 pm in History, Law | Permalink

A quick history lesson for those of you not familiar with that landmark decision:

United States v. Nixon, 418 U.S. 683 (1974), was a landmark United States Supreme Court decision which resulted in a unanimous 8–0 ruling against President Richard Nixon, ordering him to deliver presidential tape recordings and other subpoenaed materials to the District Court. Issued on July 24, 1974, the ruling was important to the late stages of the Watergate scandal, when there was an ongoing impeachment process against Richard Nixon. United States v. Nixon is considered a crucial precedent limiting the power of any U.S. president to claim executive privilege.

Here is the rest of the Wikipedia entry.

Here is a new interview with Gladwell, much of it focusing on the Brown vs. Board of Education decision.  Here is one excerpt:

I was more than interested to discover how much of the work on these effects—which in education they call “same race effects”—has been done by economists. If I’m a social psychologist, the economists are eating my lunch. They’re doing very persuasive, very elegant studies using these data sets that come out of the education reform movement. The economists are the first to jump on it. I feel like that is rich hunting ground for social psychologists as well, and they can bring a perspective to the analysis of that data that the economist can’t.

I’m not criticizing the work that’s been done by economists, but if you read it, you will notice that there is a beat that’s missing—they’re economists, so they come at it from a different perspective. I would love to see social psychologists go over that same data and interpret it their way. And that again would be something that would be insanely useful to the conversation we have in this country about how to make schools better.

And here is Malcom on his next book:

MG: Yes. I’ve started a new book, and it very explicitly comes out of the world of psychology. There was a paper that Lee Ross wrote 50 years ago, maybe 45 years ago, called “Shortcomings of the Intuitive Psychologist.” It’s a famous paper, and I’m tearing off a little, tiny piece of that argument and having fun with it.

DN: And what piece is that?

MG: I’m interested in how we deal with strangers. How good are our intuitive ideas about dealing with strangers? I haven’t thought it through entirely, but I’m fascinated by what it means to deal with someone who you don’t know and, most importantly, whose credibility you cannot assess easily. Strikes me as a very contemporary problem, and from a psychological perspective, super interesting. There’s just so much fantastic psychology on that question.

The brief discussion on rock and roll vs. country music was interesting as well.

Here is the Behavioral Scientist web site, it looks interesting.  Here are their most popular articles.

DARE to Look at the Evidence!

by on July 12, 2017 at 11:40 am in Economics, Law | Permalink

We must have Drug Abuse Resistance Education…I am proud of your work. It has played a key role in saving thousands of lives and futures.

Speaking at the 30th DARE Training Conference, Attorney General Jeff Sessions was enthusiastic and strongly supportive of DARE, the program started in Los Angeles in 1983 that uses police officers to give young children messages about staying drug free and resisting peer pressure.

And what do our excellent colleagues at GMU’s Center for Evidence-Based Crime Policy say about DARE?

D.A.R.E. is listed under “What doesn’t work?” on our Review of the Research Evidence. 

Rosenbaum summarized the research evidence on D.A.R.E. by titling his 2007 Criminology and Public Policy article “Just say no to D.A.R.E.” As Rosenbaum describes, the program receives over $200 million in annual funding, despite little or no research evidence that D.A.R.E. has been successful in reducing adolescent drug or alcohol use. As Rosenbaum (2007: 815) concludes “In light of consistent evidence of ineffectiveness from multiple studies with high validity, public funding of the core D.A.R.E. program should be eliminated or greatly reduced. These monies should be used to fund drug prevention programs that, based on rigorous evaluations, are shown to be effective in preventing drug use.”

A systematic review by West and O’Neal (2004) examined 11 published studies of D.A.R.E. and reached similar conclusions. D.A.R.E. has little or no impact on drug use, alcohol use, or tobacco use. They concluded that ““Given the tremendous expenditures in time and money involved with D.A.R.E., it would appear that continued efforts should focus on other techniques and programs that might produce more substantial effects” (West & O’Neal, 2004: 1028).

Recent reformulations of the D.A.R.E. program have not shown successful results either. For example, the Take Charge of your Life program, delivered by D.A.R.E. officers was associated with significant increases in alcohol and cigarette use by program participants compared to a control group (Sloboda et al., 2009).

This Buzzfeed article on unauthorized poop transplants has much of interest:

A spate of studies over the last decade have convinced microbiologists and doctors that “fecal microbiota transplantation,” or FMT, works for at least one disease: a deadly bacterial infection in the gut known as Clostridium difficile, or C. diff. No one knows whether the procedures work on other conditions, though dozens of clinical trials are testing them on people with irritable bowel syndromeCrohn’s diseaseobesitydiabetesepilepsyautism, and even HIV.

The science is advancing rapidly, with more and more scientists excited about the potential and potency of fecal matter and the microbes in it. The FDA regulations on these procedures, however, keep them out of reach for most patients: Since 2013, the agency has banned doctors from doing fecal transplants on anything except C. diff.

A rogue clinic in Tampa, however, provides the carefully sourced material and explains to patients how the procedure is done. Since the procedure is simple, lots of experimentation is going on which upsets some people.

Poop from an unscreened stranger could carry serious infections, like hepatitis or gonorrhea, or dormant viruses.

No doubt–this is why we also ban sex and french kissing.

I suspect that many of the so-called treatments are crazy but people do a lot of crazy things. It’s odd that we allow some crazy things and ban others—even more that the crazy things we allow are sometimes socially useless while the crazy things that we ban are sometimes socially valuable.

The case for banning extreme sports, for example, is much stronger than the case for banning extreme medicine. Extreme sports don’t provide much benefit to the rest of humanity, other than some entertainment of questionable social value. Extreme medicine, on the other hand, has the potential to improve all our lives and at the very least is a useful warning about what not to do. Yet, extreme sports are lauded, or at least treated as mostly your own business (we do put some regulations on boxing and race car driving), while extreme medicine is heavily regulated and socially frowned upon.

My attitude is the reverse. You want to risk your life climbing without ropes? Knock yourself out–but don’t expect any support from me. I won’t even watch Alex Honnold because I think that what he does is Russian roulette and I do not approve. But, you want to risk your life trying an unapproved medical treatment? Sir, I salute you. Give that man a Nobel prize.

Deterrence

by on July 7, 2017 at 12:59 pm in Law, Travel | Permalink

She told Hawaii News Now that she considered protesting, but was scared to make a scene. “I started remembering all those incidents with United on the news. The violence. Teeth being knocked out,” she said.

Here is the full story.  Basically the two-year-old toddler did not have his boarding pass properly scanned, the seat was given away to someone else, and he had to sit on his mother’s lap for a three-hour flight.

Medicaid isn’t worth its cost–that’s not my evaluation that’s what people who use the program think, at least as far as we can tell from their actions. Joshua D. Gottlieb and Mark Shepard review the evidence at Econofact, which aims to be a dispassionate and non-partisan review of the evidence on a variety of issues. We have also covered these issues before but seeing it all together is valuable.

The cost is large:

The Medicaid program cost about $532 billion in 2015 to cover 74 million people, or almost one in four Americans. The average full-benefit enrollee cost about $6,400 per year to cover in 2014.

People with access to the program use a lot more healthcare than other similar people

The Oregon Experiment found that gaining Medicaid uniformly increased health care use: including hospitalizations (by 30 percent), emergency room use (by 40 percent), physician office visits (by 50 percent), and prescription drugs (by 15 percent). This evidence stands in contrast to the conventional wisdom that providing health insurance could reduce costs by eliminating ER visits. Of course, understanding whether this additional care is worth it requires a comparison of these real costs to the benefits provided.

The health benefits appear to be real but modest:

The evidence is mixed on whether having Medicaid improves beneficiaries’ health. The Oregon Experiment did not find statistically significant evidence of improvements in physical health measures, such as blood pressure and blood sugar after two years of coverage. But it did find large improvements in mental health and self-reported health. Other studies examining the introduction of Medicaid or its expansion over time have found that Medicaid reduces mortality (of infants during the expansion of Medicaid eligibility for low-income children between 1984-1992; of adults during the expansion of Medicaid coverage for childless adults in Arizona, Maine and New York between 2000-2005; of teenagers who benefited from expansions of Medicaid to children during the early 1980s; and of infants and children in the 1960s and 1970s following the introduction of Medicaid) and improves health later in life (for instance among teenagers who benefited from the expansion of coverage as children). But these studies lack the gold-standard randomized design of the Oregon Experiment so should be interpreted with greater caution.

Health benefits may not be the most important benefits:

One important role for Medicaid is to provide risk protection, shielding enrollees from the financial impact of particularly adverse health events, which is the most fundamental role of an insurance product. Researchers seem to agree that access to Medicaid does improve financial security.

So how does one evaluate the tradeoffs? One way is to look at how users value the program.

Recent evidence indicates that beneficiaries value Medicaid at less than its full cost. One source of evidence comes from Massachusetts’ low-income health insurance exchange, where researchers could observe how much charging higher premiums for Medicaid-like coverage led enrollees to drop out: at least 70 percent of enrollees valued insurance at less than their own cost of coverage. A second source of evidence used economic models to quantify how much beneficiaries valued the benefits of Medicaid in the Oregon Experiment. In this case, the researchers found that beneficiaries valued Medicaid at about one-fifth of its cost.

Benefits are valued at only one-fifth the cost!  Why so low?

The literature suggests two explanations. First, Medicaid provides less complete choice of doctors and hospitals than other insurance, partly because of its low reimbursement rates (see this article for instance). Second, many of the benefits of Medicaid go to medical providers who would otherwise provide uncompensated or unpaid care to the same people.

The authors don’t mention this but if users don’t value the program highly because they would have gotten similar care for free in some other way, then the cost of Medicaid isn’t as high as it appears, because much of it is a transfer from taxpayers to medical providers or others who might otherwise foot the bill. Nevertheless we would probably design Medicaid very differently if we thought about it as (another) subsidy to medical providers rather than as a subsidy to the poor and sick.

It doesn’t follow from anything that has been said that Medicaid should be eliminated or even cut back (let alone that current efforts are the best way to do this). Nevertheless, if I told you that Program X costs $5 for every $1 in value transferred to recipients you would probably agree that Program X was in need of reform.

Addendum: Aaron Carroll and Austin Frakt offer a more optimistic review of the health evidence.