Category: Law
Regulatory solutions from Emanuel Derman
I had a fantasy in which the Fed and the TSA (Transportation Security Administration) switched roles.
If a bank failed at 9 a.m. one morning and shut its doors, the TSA would announce that all banks henceforth begin their business day at 10 a.m.
And, if a terrorist managed to get on board a plane between Stockholm and Washington, the Fed would increase the number of flights between the cities.
The piece is here and the pointer is from Felix Salmon.
Markets in everything China fact of the day
Wanted: One live-in protester, $146 a month, no days off.
When the managers of a Beijing restaurant marked for demolition were too busy to fight it, they posted an Internet ad and hired a stranger to stay there around the clock. The job seems to be a first for China, where frenzied urban construction has led to violent evictions, protests and even suicide.
Huddled on a makeshift bed in the trash-strewn, freezing restaurant, Lu Daren said he once worked for a demolition crew and understands their tactics.
"I'm tired," the 46-year-old said Thursday, after a long night of fending off the latest visit from what he suspects were hired thugs by the landlord. "Tired, tired, tired." He stays – wrapped in blankets, reading the newspaper or writing idle poetry, occasionally taking short walks_ because he thinks the restaurateurs have been treated unfairly.
The full story is here and I thank Daniel Lippman for the pointer.
Christmas Bonuses for Fannie and Freddie
The Obama administration tried to sneak this one under the radar by making it official on Christmas Eve. The Washington Post did a good job catching the story:
The Obama administration pledged Thursday to provide unlimited financial assistance to mortgage giants Fannie Mae and Freddie Mac, an eleventh-hour move that allows the government to exceed the current $400 billion cap on emergency aid without seeking permission from a bailout-weary Congress.
…But even as the administration was making this open-ended financial commitment, Fannie Mae and Freddie Mac disclosed that they had received approval from their federal regulator to pay $42 million in Wall Street-style compensation packages to 12 top executives for 2009.
The compensation packages, including up to $6 million each to Fannie Mae and Freddie Mac's chief executives, come amid an ongoing public debate about lavish payments to executives at banks and other financial firms that have received taxpayer aid. But while many firms on Wall Street have repaid the assistance, there is no prospect that Fannie Mae and Freddie Mac will do so.
No Give, No Take in Israel
In January, Israel will become the first country in the world to give people who sign their organ donor cards points pushing them up the transplant list should they one day need a transplant. Points will also be given to transplant candidates whose first-degree relatives have signed their organ donor cars or whose first-degree relatives were organ donors.
In the case of kidneys, for example, two points (on a 0-18 point scale) will be given if the candidate had three or more years previous to being listed signed their organ card. One point will be given if a first-degree relative had signed and 3.5 points if a first-degree relative had previously donated.
In Entrepreneurial Economics I argued for a point allocation system like this–which I called a "no give, no take" system–as a way to increase the incentive to sign one's organ donor card. One advantage of a no-give, no take system over paying for organs is that most people find this type of system to be fair and just–those who are willing to give are the first to receive should they one day be in in need.
The new policy will be widely advertised in Israel and will be transitioned into place beginning in January. I think this new policy is very important. If organ donation rates increase in Israel, I expect that other countries will quickly follow suit.
By the way, is it peculiar that the two countries in the world with the best organ donor systems are now Israel and Iran?
Hat tip to Dave Undis whose Lifesharers group (I am an advisor) is working on implementing a similar system in the United States.
Managua
With over 600 barrios, a definitive breakdown of Managua safety is a book in itself. As a general rule, don't ever walk more than a few blocks anywhere in Managua. There are almost no police during the night time and with no centre there are few places where the streets will be busy. The Metrocentro area is safe, but it's still best not to walk alone. The only place that lends itself to walking is the malecón and central park area of old Managua, but do not walk here at night under any circumstances. Even during the daytime take precautions, don't carry any more than you need and avoid walking alone. Be careful when visiting the Catedral Nueva, which is next to a barrio with many thieves. Having said all of this, in comparison with other Central American capitals Managua is safe for the visitor, although theft is common at bus stations and outside the more affluent neighborhoods
That's from my guidebook. It seemed fine to me.
Nie pozwalam!
Liberum veto (Latin for I freely forbid) was a parliamentary device in the Polish-Lithuanian Commonwealth. It allowed any member of the Sejm to force an immediate end to the current session and nullify all legislation already passed at it by shouting Nie pozwalam! (Polish: I do not allow!).
Here is more.
State licensed hypnotists
Kevin Carey has a sadly amusing post on occupational licensing:
Back when I was working for the Indiana General Assembly, one member…became convinced that it was crucially important for the state to address, via statute, the problem of rogue hypnotists traveling the land, preying upon unsuspecting Hoosiers. He wasn’t anti-hypnotist, mind you–he thought the government needed to protect people from unqualified hypnotists…
So the state passed a hypnotist licensing law, complete with the requisite boards, professional standards, forms to fill out, fees to pay, and so on….Then, after the law was enacted, a funny thing started happening: The state began receiving license applications from people who didn’t live in Indiana….It turns out they were doing it so they could advertise in the yellow pages and on bus-stop billboards as “state-licensed.”
Hat tip to Matt Yglesias.
Swiss minarets
I have a few points:
1. Sooner or later an open referendum process will get even a very smart, well-educated country into trouble.
2. Given that the referendum came up, it was wise to root for its defeat. The victory of the referendum is a symbol that prejudice can now advance a step.
3. That said, was there not some other way to sidestep this dilemma? Washington D.C. doesn't allow tall buildings to compete with the Washington Monument, yet no one considers that a restriction on political freedom (though it may be a bad idea for economic reasons). The Swiss cantons could have done the same for their town churches. Note that a restriction on a minaret is not a restriction on a mosque.
4. I favor greater Muslim immigration into the United States and I think Muslim emigration to Europe is working better than most people think. I am happy to see that Switzerland has become a more cosmopolitan society, in large part by taking in more emigrants, including Muslims. Nonetheless, call me old-fashioned, but I don't think a Swiss town center should look like the photograph above. I guess the Swiss don't either.
5. I also don't have any problem with Mecca limiting the size of Christian churches in that town, or say if an American billionaire wanted to build a really big cross there. (Oddly Dubai allows it.)
6. The United States is special and thus it allows a very, very large mosque not so far from Bowling Green, Ohio. I am pleased we have the sort of polity which makes this possible, but I also recognize many other countries cannot inhabit this same political space.
7. The overall lesson is that knowing how and when to defuse an issue is one very large part of political wisdom. The Swiss usually pass this test but this time they failed it.
Debtors’ prison
Ahem:
“I’m really scared of what could happen, because I bought property here,” said Sofia, who asked that her last name be withheld because she is still hunting for a new job. “If I can’t pay it off, I was told I could end up in debtors’ prison.”
With Dubai’s economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.
I guess you can't say you were simply late in assembling the funds. Debtors account for about forty percent of the Dubai prison population. Here is much more information. For the pointer I thank Chris.
DNA for work and love
University of Akron demands DNA sample from faculty as condition of employment.
Dating sites use your DNA to find a perfect love match.
Hat tip to my true major histocompatibility complex match.
Markets in everything?
A gang in the remote Peruvian jungle has been killing people for their
fat, the police said Thursday, accusing the gang’s members of draining
fat from bodies and selling it on the black market for use in
cosmetics…Three suspects have confessed to killing five people for their fat,
said Col. Jorge MejÃa, chief of Peru’s anti-kidnapping police. He said
the suspects, two of whom were arrested carrying bottles of liquid fat,
told the police it was worth $60,000 a gallon.Colonel MejÃa said
the suspects had told the police that the fat had been sold to
intermediaries in Lima, the capital. While police officials suspect
that the fat was sold to cosmetic companies in Europe, he said he could
not confirm any sales.
That's from The New York Times, not The Weekly World News. Medical "experts" express varying degrees of skepticism about the depth and liquidity of this market, but if you read the whole article you will encounter some truly graphic descriptions of the production process. Caveat emptor.
Giovanni Peri’s latest on immigration and productivity
Here is the abstract and it has to do with a Smithian theme, namely division of labor:
Using the large variation in the inflow of immigrants across US states we analyze the impact of immigration on state employment, average hours worked, physical capital accumulation and, most importantly, total factor productivity and its skill bias. We use the location of a state relative to the Mexican border and to the main ports of entry, as well as the existence of communities of immigrants before 1960, as instruments. We find no evidence that immigrants crowded-out employment and hours worked by natives. At the same time we find robust evidence that they increased total factor productivity, on the one hand, while they decreased capital intensity and the skill-bias of production technologies, on the other. These results are robust to controlling for several other determinants of productivity that may vary with geography such as R&D spending, computer adoption, international competition in the form of exports and sector composition. Our results suggest that immigrants promoted efficient task specialization, thus increasing TFP and, at the same time, promoted the adoption of unskilled-biased technology as the theory of directed technological change would predict. Combining these effects, an increase in employment in a US state of 1% due to immigrants produced an increase in income per worker of 0.5% in that state.
The paper is here.
Kelo update
Those who would sacrifice property rights to development end up with neither.
Markets in everything: 8 year old child custody for two Damien Hirsts edition
Kapernekas, a 49-year-old New York art dealer filed a suit
in federal court in Manhattan claiming an interest in the two
Hirsts, which have been valued at an estimated $47.6 million,
court documents show. The custody suit, involving their 8-year-
old daughter, was being heard in New York County Family Court.Kapernekas has agreed to drop the federal suit and claims
on the Hirsts in exchange for: custody of their daughter
(Brandhorst gets visitation and vacation rights); a one-time
payment of $100,000; a $500,000 trust for the daughter’s
education; a loft on Wooster Street in Manhattan’s Soho district
valued at about $5 million to be held in the daughter’s name as
sole owner; $5,000 a month in child support; and $640,000 to
cover Kapernekas’s legal expenses, according to Kapernekas.
The full story is here and the pointer is from Felix Salmon. Felix writes:
Need I add that one of the Hirsts is entitled “In this terrible moment
we are victims clinging helplessly to an environment that refuses to
acknowledge the soul”?
Countercyclical “asset” of the day — burglary watch
With a lot more unemployed people, a lot more people are staying home, and they see more in their neighborhood," said Sgt. Thomas Lasater, who supervises the burglary unit of the police department in St. Louis County, Mo., where authorities recorded a whopping 35 percent drop in burglaries during the first six months of 2009.
The falling price of raw materials — which had been producing copper and other thefts — may be another reason for the change in trend. Here is the story and I thank Daniel Lippman for the pointer.