Category: Law

Let the boy Brexit!

Pope Francis has been praying for the British toddler Alfie Evans — and the Italian government has granted the child Italian citizenship and lined up a transportation plan that could swiftly bring the sick little boy to a Vatican hospital.

But Alfie’s doctors say he cannot be healed, and shouldn’t make the trip at all.

On Tuesday, according to lawyers representing Alfie’s family, a British judge sided with the doctors, saying that the family cannot accept the offer to take Alfie to the Vatican for treatment.

Here is the full story.  The boy’s situation is dire, but he has not even received a definitive diagnosis from the British doctors.

The new economics of Tanzanian blogging

Repressive regimes across the world have found inventive ways to stifle internet freedom, from deleting posts to blocking service. But Tanzania’s government has come up with a scheme that could prove even more draconian: it plans to charge hundreds of dollars a year for the privilege of blogging.

As part of new online regulations, bloggers will be required to pay hefty registration and annual licence fees that add up to roughly $920 — prohibitive for most in a country with a nominal per capita income of under $900.

In proportion to GDP, the Tanzanian registration and licence fee would be the equivalent of asking Americans to pay nearly $60,000 to start a blog.

That is from John Aglionby and David Pilling at the FT.

Who’s complacent? Penn State is complacent

The student “Outing Club,” which has gone backpacking, kayaking, and hiking in state parks over the course of its 98-year-existence, will no longer be allowed to host outdoor events after administrators conducted a risk assessment, according to The Pittsburgh Post-Gazette.

“The types of activities in which [Penn State Outing Club] engages are above the university’s threshold of acceptable risk for recognized student organizations,” according to an official announcement.

A key issue for administrators was that the Outing Club frequently visit locations with poor cell phone coverage. This wasn’t an issue during the Coolidge administration, but now that cell phones exist, students are apparently expected to remain glued to them at all times.

“Student safety in any activity is our primary focus,” Lisa Powers, a Penn State spokeswoman, told The Post-Gazette.

And yet the treasurer of the Outing Club said that he hadn’t heard of any injuries sustained on club outings in recent years.

Here is the full story at Reason, via Maximilian Roos.

Defensive Gun Use and the Difficult Statistics of Rare Events

In the mid-1990s, Kleck and Gertz (1995) estimated that in a typical year about 1.3% of US adults used a gun for self-defense against another person. Kleck and Gertz’s estimate, which came from a survey of nearly 5000 people, implied that there were millions of defensive gun uses every year.

Following Kleck and Gertz’s 1995 paper, the CDC added a question about defensive gun use to their Behavioral Risk Factor Surveillance System (BRFSS). In 1996, 1997, and 1998 the CDC asked:

“During the last 12 months, have you confronted another person with a fire arm, even if you did not fire it, to protect yourself, your property, or someone else?”

But here is the surprise. The CDC buried the question and the results. Only recently was the data discovered and made public by Kleck in a new paper.*(see addendum) So what were the results? You will perhaps now not be too surprised that the CDC’s survey supports Kleck and Gertz’s original finding, about 1% of survey respondents reported a defensive gun use, implying millions of such uses over a year.

The case isn’t closed on defensive gun use, however, because of a statistical conundrum.

The CDC asked 12,870 individuals about defensive gun use over the three samples.That’s a relatively large sample but note that this means that just 117 people reported a defensive gun use, i.e. ~1%. In comparison, 12,656 people (98.33%) reported no use, 11 people (0.09%) said they didn’t know and 86 people (0.67%) refused to answer. People answering surveys can be mistaken and some lie and the reasons go both ways. Some people might be unwilling to answer because a defensive gun use might have been illegal (Would these people refuse to answer?). On the other hand, mischievous responders might report a defensive gun use just because that makes them sound cool.

The deep problem, however, is not miscodings per se but that miscodings of rare events are likely to be asymmetric. Since defensive gun use is relatively uncommon under any reasonable scenario there are many more opportunities to miscode in a way that inflates defensive gun use than there are ways to miscode in a way that deflates defensive gun use.

Imagine, for example, that the true rate of defensive gun use is not 1% but .1%. At the same time, imagine that 1% of all people are liars. Thus, in a survey of 10,000 people, there will be 100 liars. On average, 99.9 (~100) of the liars will say that they used a gun defensively when they did not and .1 of the liars will say that they did not use a gun defensively when they did. Of the 9900 people who report truthfully, approximately 10 will report a defensive gun use and 9890 will report no defensive gun use. Adding it up, the survey will find a defensive gun use rate of approximately (100+10)/10000=1.1%, i.e. more than ten times higher than the actual rate of .1%! Those numbers are, of course, approximately what the CDC survey found which doesn’t prove that Kleck’s interpretation is wrong only that very different interpretations are also plausible.

The bottom line is that it’s good to know that the original Kleck and Gertz survey replicated–approximately 1% of adult Americans did report a defensive gun use in the 1990s–but the real issue is the interpretation of the survey and for that a replication doesn’t help.

Addendum: The paper has since been taken down perhaps because in addition to the issue of interpretation that I raised the survey may not have been national. Robert VerBruggen has further details.

How common is child marriage in the United States?

Approximately 6.2 of every 1,000 children surveyed had ever been married. Prevalence varied from more than 10 per 1,000 in West Virginia, Hawaii and North Dakota to less than four per 1,000 in Maine, Rhode Island and Wyoming. It was higher among girls than among boys (6.8 vs. 5.7 per 1,000), and was lower among white non‐Hispanic children (5.0 per 1,000) than among almost every other racial or ethnic group studied; it was especially high among children of American Indian or Chinese descent (10.3 and 14.2, respectively). Immigrant children were more likely than U.S.‐born children to have been married; prevalence among children from Mexico, Central America and the Middle East was 2–4 times that of children born in the United States. Only 20% of married children were living with their spouses; the majority of the rest were living with their parents.

That is from Alissa Koski and Jody Heymann, via the excellent Kevin Lewis.

How big are the buyer and renter gains from SB 827?

This article considers a counterfactual thought experiment: how would California’s housing market be different today if a policy currently under consideration in the California Senate—SB 827, which would allow new residential building along public transit corridors—had been implemented six years ago? I estimate that rent would be 5.8 percent lower in San Francisco, a savings of $266 per month on the median home, and 4.2 percent lower in Los Angeles County, savings of $124 per month.

That is from Salim Furth at Mercatus, here is much more.  You will note those numbers do not include the higher output and innovation from a more efficient allocation of talent.

Here is Salim’s podcast with Matt Yglesias and Emily Hamilton.

The impact of the Dodd-Frank Act on small business

There are concerns that the Dodd-Frank Act (DFA) has impeded small business lending. By increasing the fixed regulatory compliance requirements needed to make business loans and operate a bank, the DFA disproportionately reduced the incentives for all banks to make very modest loans and reduced the viability of small banks, whose small-business share of C&I loans is generally much higher than that of larger banks. Despite an economic recovery, the small loan share of C&I loans at large banks and banks with $300 or more million in assets has fallen by 9 percentage points since the DFA was passed in 2010, with the magnitude of the decline twice as large at small banks. Controlling for cyclical effects and bank size, we find that these declines in the small loan share of C&I loans are almost all statistically attributed to the change in regulatory regime. Examining Federal Reserve survey data, we find evidence that the DFA prompted a relative tightening of bank credit standards on C&I loans to small versus large firms, consistent with the DFA inducing a decline in small business lending through loan supply effects. We also empirically model the pace of business formation, finding that it had downshifted around the time when the DFA and the Sarbanes-Oxley Act were announced. Timing patterns suggest that business formation has more recently ticked higher, coinciding with efforts to provide regulatory relief to smaller banks via modifying rules implementing the DFA. The upturn contrasts with the impact of the Sarbanes-Oxley Act, which appears to persistently restrain business formation.

That is from Michael D. Bordo and John V. Duca.

Privacy sentences to ponder

The increasing difficulty in managing one’s online personal data leads to individuals feeling a loss of control. Additionally, repeated consumer data breaches have given people a sense of futility, ultimately making them weary of having to think about online privacy. This phenomenon is called “privacy fatigue.” Although privacy fatigue is prevalent and has been discussed by scholars, there is little empirical research on the phenomenon. A new study published in the journal Computers and Human Behavior aimed not only to conceptualize privacy fatigue but also to examine its role in online privacy behavior. Based on literature on burnout, we developed measurement items for privacy fatigue, which has two key dimensions —emotional exhaustion and cynicism. Data analyzed from a survey of 324 Internet users showed that privacy fatigue has a stronger impact on privacy behavior than privacy concerns do, although the latter is widely regarded as the dominant factor in explaining online privacy behavior.

Emphasis added by me.  That is by Hanbyl Choi, Jonghwa Park, and Yoonhyuk Jung, via Michelle Dawson.

*Tyranny Comes Home: The Domestic Fate of U.S. Militarism*

That is the new book by Christopher J. Coyne and Abigail R. Hall:

 

Their main point is that social tactics used in interventions abroad tend to come back and haunt us at home.  I am not nearly as non-interventionist in foreign policy questions as they are, but still I wish their perspective would receive a much broader hearing.  You can buy the book here.  Here is the book’s home page.  Here is a video related to the book.

The Chinese corporate apology

When does a corporate apology become a political self-confession, or jiantao (检讨), an act of submission not to social mores and concerns, but to those in power? The line can certainly blur in China. But the public apology today from Zhang Yiming (张一鸣), the founder and CEO of one of China’s leading tech-based news and information platforms, crosses deep into the territory of political abjection.

Zhang’s apology, posted to WeChat at around 4 AM Beijing time, addressed recent criticism aired through the state-run China Central Television and other official media of Jinri Toutiao, or “Toutiao” — a platform for content creation and aggregation that makes use of algorithms to customize user experience. Critical official coverage of alleged content violations on the platform was followed by a notice on April 4 from the State Administration of Press, Publication, Radio, Film, and Television (SAPPRFT), in which the agency said Toutiao and another service providing live-streaming, Kuaishou, would be subject to “rectification measures.”

Read through Zhang’s apology and it is quickly apparent that this is a mea culpa made under extreme political pressure, in which Zhang, an engineer by background, ticks the necessary ideological boxes to signal his intention to fall into line.

At one point, Zhang confesses that the “deep-level causes” of the problems at Toutiao included “a weak [understanding and implementation of] the “four consciousnesses”. This is a unique Xi Jinping buzzword, introduced in January 2016, that refers to 1) “political consciousness” (政治意识), namely primary consideration of political priorities when addressing issues, 2) consciousness of the overall situation (大局意识), or of the overarching priorities of the Party and government, 3) “core consciousness” (核心意识), meaning to follow and protect Xi Jinping as the leadership “core,” and 4) “integrity consciousness” (看齐意识), referring to the need to fall in line with the Party. Next, Zhang mentions the service’s failure to respect “socialist core values,” and its “deviation from public opinion guidance” — this latter term being a Party buzzword (dating back to the 1989 crackdown on the Tiananmen Square protests) synonymous with information and press controls as a means of maintaining Party dominance.

Zhang also explicitly references Xi Jinping’s notion of the “New Era,” and writes: “All along, we have placed excessive emphasis on the role of technology, and we have not acknowledged that technology must be led by the socialist core value system, broadcasting positive energy, suiting the demands of the era, and respecting common convention.”

In the list of the company’s remedies, there is even a mention of the need to promote more content from “authoritative media,” a codeword for Party-controlled media, which suggests once again that the leadership has been unhappy with the idea of algorithms that wall users off from official messaging if they show no interest in such content.

Here is the full story, via Anecdotal.

Zeynep Tufekci’s Facebook solution — can it work?

Here is her NYT piece, I’ll go through her four main solutions, breaking up, paragraph by paragraph, what is one unified discussion:

What would a genuine legislative remedy look like? First, personalized data collection would be allowed only through opt-in mechanisms that were clear, concise and transparent. There would be no more endless pages of legalese that nobody reads or can easily understand. The same would be true of any individualized targeting of users by companies or political campaigns — it should be clear, transparent and truly consensual.

Who can be against “clear, transparent and truly consensual?”  But this reminds me of those conservatives who wish regulations would be shorter, simpler, easier to write — it’s not always that easy and wishing don’t make it so.  (Try sitting down with someone in the immediate process of writing such a rule.)  That said, let’s think about what maybe will happen.  How about the United States adopting some version of the forthcoming EU GDPR?  That might in fact be an OK outcome (NYT).  But will that be clear and transparent?  Is any EU regulation clear and transparent?  Can anyone tell me, sitting in their seats right now, if it will outlaw the blockchain or not?  Whether it outlaws the blockchain or not, could either of those outcomes be called “consensual”?  I don’t think Tufekci has given an actual proposal yet.

Second, people would have access, if requested, to all the data a company has collected on them — including all forms of computational inference (how the company uses your data to make guesses about your tastes and preferences, your personal and medical history, your political allegiances and so forth).

This is not feasible, as computational inference is usually not transparent and often is understood by nobody.  But even the simpler stuff — what exactly is the call here?  That Facebook has to send you a big zip file?  Is the goal to inform people in some meaningful way?  Or simply to deter Facebook from having the information in the first place?  If it’s the latter, let’s have a more explicit argument that people would prefer a Facebook they have to pay for.  Personally, I don’t think they would prefer that and already have shown as such.

Third, the use of any data collected would be limited to specifically enumerated purposes, for a designed period of time — and then would expire. The current model of harvesting all data, with virtually no limit on how it is used and for how long, must stop.

“Must”?  Not “should”?  That is a classic example of trying to establish a conclusion simply by word usage.  In this context, what does “enumerated” mean?  Are we back to GDPR?  Or they send you an email with a long list of what is going on?  Or that information sits behind a home page somewhere?  (So much for simple and transparent.)  You have to opt in to each and every use of the data?  So far it sounds like more bureaucracy and less transparency, and in fact this kind of demand is precisely the origin of those lengthy “opt in” statements that no one reads or understands.

Fourth, the aggregate use of data should be regulated. Merely saying that individuals own their data isn’t enough: Companies can and will persuade people to part with their data in ways that may seem to make sense at the individual level but that work at the aggregate level to create public harms. For example, collecting health information from individuals in return for a small compensation might seem beneficial to both parties — but a company that holds health information on a billion people can end up posing a threat to individuals in ways they could not have foreseen.

Maybe, but there is no example given of harm other than an unspecified speculation.  It also seems to be saying I don’t have a First Amendment right to write personal information into a text box.  And who here is to do the regulating?  Government is one of the biggest violators of our privacy, and also a driving force behind electronic medical records, another massive medical privacy violator (for better or worse), most of all after they are hacked and those who have sought mental illness treatment have their identities put on Wikileaks.  The governmental system of identity and privacy is based around the absurdity of using Social Security numbers.  Government software is generations behind the cutting edge and OPM was hacked very badly, not to mention Snowden made away with all that information.  And government is to be the new privacy guardian?  This needs way, way more of an argument.

I do understand that the author had only a limited word count.  But googling “Zeynep Tufekci Facebook”  does not obviously bring us to a source where these proposals are laid out in more detail, nor is there any link in the on-line version of the article to anyone else’s proposal, much less hers.  So I say this piece is overly confident and under-argued.

What instead?  I would instead start with the sentence “Most Americans don’t value their privacy or the security of their personal data very much,” and then discuss all the ways that limits regulation, or lowers the value of regulation, or will lead many well-intended regulations to be circumvented.  Next I would consider whether there are reasonable restrictions on social media that won’t just cement in the power of the big incumbents.  Then I would ask an economist to estimate the costs of regulatory compliance from the numerous lesser-known web sites around the world.  Without those issues front and center, I don’t think you’ve got much to say.

Which companies are likely to be good or bad at public relations?

That is the topic of my latest Bloomberg column, the community banks are likely to be good, here is one excerpt:

I think of community banks as enjoying relatively high levels of trust. Millions of Americans have walked through the doors of their local banks and dealt with the loan officers, tellers and account managers, giving the business a human face. A community bank cannot serve a region without sending out a fair number of foot soldiers. Banks tend to have longstanding roots in their communities, and a large stock of connections and accumulated social capital.

In turn, community banks have converted this personal trust into political clout. There are community banks in virtually every congressional district, and these banks have developed the art of speaking for many different segments of American society, not just a narrow coastal elite. When these banks mobilize on behalf of a political cause, they are powerful, as illustrated by the likelihood that they will get regulatory relief from the Dodd-Frank Act, probably with bipartisan support. They have such influence that one member of the Federal Reserve Board must be a community banker, even though few economists see much rationale for this provision.

Given their usefulness, it would be wrong to describe community bankers as a stagnant sector of our economy. Still, the same features that make them trusted and politically powerful also make them unlikely to be major sector disruptors.

Already you can see a problem shaping up, as perhaps the faster-growing, higher productivity gain companies will have less experience.  And indeed often the very dynamic, big tech companies are not so good at public relations:

Alternatively, let’s say you were designing a business that, whatever its other virtues might be, would not be very good at public relations.

First, you would make sure the business had come of age fairly recently. That would ensure the company didn’t have a long history of managing public relations, learning how the news media work, figuring out what it will or will not be blamed for, and rooting itself in local communities.

The next thing you might do is to concentrate the company’s broader business sector in one particular part of the country. That would ensure that the companies’ culture didn’t reflect the broadest possible swath of public opinion. Better yet, don’t choose a swing state such as Pennsylvania or Ohio, but rather opt for a region that is overwhelmingly of a single political orientation and viewed by many Americans as a bit crazy or out of touch. How about Northern California?

There is much more at the link.  The clincher of course is this:

And we have been building a political system that favors the time-honored company rather than the radical innovator.

Arbitrage, by economics departments

Foreign STEM graduates (the acronym stands for science, technology, engineering and mathematics) can get visa extensions for three years of practical training (ie, work). Those from other disciplines are allowed only a year.

Two more years working in America means more earnings. It also means a better chance of finding an employer willing to sponsor an application for an H-1B visa, the main starting-point for skilled foreign workers who hope to settle permanently. In 2012 the Department of Homeland Security expanded the list of STEM courses. Now any reasonably crunchy economics degree can count as STEM with a tweak to its federal classification code, from economics (45.0601) to econometrics and quantitative economics (45.0603).

Economics departments appear to be catching on. Yale and Columbia have both changed the code for their economics major in the past few months; five of the eight Ivy League Universities have now done so. Students at Pennsylvania and Cornell are agitating for a switch.

Here is more from The Economist.

What is Skim Milk? The FDA versus Dairy Farmers

FDA food regulation isn’t as high stakes as FDA drug regulation but it can be both costly and absurd. A case in point. The FDA controls how foods are labeled with the goal of ensuring that they are “properly” labelled. It’s important that consumers not be misled but what does one say, for example, about soy milk? Is that label proper? (The FDA so far has declined to rule on that issue but the “Defending Against Imitations and Replacements of Yogurt, Milk, and Cheese To Promote Regular Intake of Dairy Everyday Act (DAIRY PRIDE) act may force their hand.)

The FDA’s control over labeling is more powerful than it appears because it can be used to define what a product is. The FDA, for example, can’t force milk producers to add vitamins to milk but by defining milk as including certain vitamins they can say that milk without these vitamins is mislabeled! This is exactly the case with dairy farmer Randy Sowers and South Mountain Creamery. South Mountain Creamery sells skim milk, i.e. milk with the fat skimmed off. The FDA, however, wants skim milk to contain as many vitamins as whole milk so they define skim milk as including vitamin A and D. If farmers want to sell skim milk and call it “skim milk” they have to add vitamins. To avoid prosecution the FDA is requiring South Mountain Creamery to label their skim milk, “imitation skim milk”! Yes. War is Peace. Freedom is Slavery. Real Skim Milk is Imitation Skim Milk. Sowers and the Institute for Justice are suing on First Amendment Grounds.

The FDA has a history of losing First Amendment cases and will probably lose this case as well. A Federal appeals court in Florida has already ruled in a very similar case that labeling skim milk, “skim milk” is not deceptive.

More arguments against blockchain, most of all about trust

Here are more arguments about blockchain from Kai Stinchcombe, here is one ouch:

93% of bitcoins are mined by managed consortiums, yet none of the consortiums use smart contracts to manage payouts. Instead, they promise things like a “long history of stable and accurate payouts.” Sounds like a trustworthy middleman!

And:

Auditing software is hard! The most-heavily scrutinized smart contract in history had a small bug that nobody noticed — that is, until someone did notice it, and used it to steal fifty million dollars. If cryptocurrency enthusiasts putting together a $150m investment fund can’t properly audit the software, how confident are you in your e-book audit? Perhaps you would rather write your own counteroffer software contract, in case this e-book author has hidden a recursion bug in their version to drain your ethereum wallet of all your life savings?

It’s a complicated way to buy a book! It’s not trustless, you’re trusting in the software (and your ability to defend yourself in a software-driven world), instead of trusting other people.

Here is the full essay, via Chris F. Masse.  Here is Kai’s earlier essay on blockchain.