Category: Law
Get Out of Jail Cards, 2
“Courtesy cards,” are cards given out by the NYC police union (and presumably elsewhere) to friends and family who use them to get easy treatment if they are pulled over by a cop. I was stunned when I first wrote about these cards in 2018. I thought this was common only in tinpot dictatorships and flailing states. The cards even come in levels, gold, silver and bronze!
A retired police officer on Quora explains how the privilege is enforced:
The officer who is presented with one of these cards will normally tell the violator to be more careful, give the card back, and send them on their way.
…The other option is potentially more perilous. The enforcement officer can issue the ticket or make the arrest in spite of the courtesy card. This is called “writing over the card.” There is a chance that the officer who issued the card will understand why the enforcement officer did what he did, and nothing will come of it. However, it is equally possible that the enforcement officer’s zeal will not be appreciated, and the enforcement officer will come to work one day to find his locker has been moved to the parking lot and filled with dog excrement.
A NYTimes article discusses the case of Mathew Bianchi, a traffic cop who got sick of letting dangerous speeders go when they presented their cards.
By the time he pulled over the Mazda in November 2018, drivers were handing Bianchi these cards six or seven times a day. (!!!, AT)
…[He gives the ticket]…The month after he stopped the Mazda, a high-ranking police union official, Albert Acierno, got in touch. He told Bianchi that the cards were inviolable. He then delivered what Bianchi came to think of as the “brother speech,” saying that cops are brothers and must help each other out. That the cards were symbols of the bonds between the police and their extended family and friends.
Bianchi was starting to view the cards as a different kind of symbol: of the impunity that came with knowing someone on the force, as if New York’s rules didn’t apply to those with connections. Over the next four years, he learned about the unwritten rules that have come to hold sway in the Police Department.
Bianchi is reassigned, given shit jobs, isn’t promoted etc. Mayor Adams and police chief Chief Maddrey protect this utterly corrupt system.
*The Economist* on Tatu City, Kenya
Take the pig’s ear first. Unveiled in 2008 as a $15bn smart city project, Konza Technopolis was supposed to be the heart of Kenya’s “silicon savannah” that, by 2020, would create 100,000 jobs and add 2% to gdp. Three years and many missed deadlines later, there is still far more evidence of savannah than silicon.
By contrast, Tatu City, on the northern outskirts of Kenya’s capital, Nairobi, is flourishing. Some 23,750 people already live, study or work there and 78 businesses have made it home. Moderna, an American drugmaker, is opening a $500m vaccine manufacturing facility, its first in Africa. Zhende Medical, a Chinese medical-supplies manufacturer, is also setting up shop.
Tatu and Konza were conceived at the same time. Each, at roughly 5,000 acres, is of a similar size. Both aspire to house populations of more than 200,000 people. And both have been designated Special Economic Zones (sezs), meaning that the businesses they house are eligible for tax benefits and other incentives. Why is one more likely to succeed than other? The answer lies not in their similarities, but in their differences, and these provide lessons for other developments in Africa.
The first is ownership. Konza’s proprietor is the state. Tatu City’s is Rendeavour, a big private urban land developer.
Here is the rest of the article. Here are my three CWT podcasts about Tatu City. I am pleased at how well it is all going!
For the pointer I thank Kurtis Lockhart of Charter Cities Institute.
My Conversation with the excellent Patrick McKenzie
Here is the audio, video, and transcript. Here is part of the episode summary:
Tyler sat down with Patrick to discuss signature fields on the back of credit cards, whether bank tellers or waitstaff are more trustworthy, the gremlins behind spurious credit card declines, how debt collection and maple syrup heists should change your model of the world, Twitter’s continued success as the message bus for government and civil society, crypto vs traditional money transfers, the intended desolation of bank parking lots, why he moved to Japan and how it affected his ambition, why Tether hasn’t collapsed, the internet as a Great Work, how he’s experiencing reverse culture shock after returning to the US, what he’ll learn about next, and more.
Excerpt:
COWEN: How did the maple syrup heists change your overall view of the world and of humanity? What’s the model update?
MCKENZIE: Going back to “evil is an actual thing in the world,” I often assume that large, well-regarded, professionalized industries have a rate of crime associated with them which rounds to zero. I would assume agriculture is relatively heavily regulated. Maple syrup is an agricultural product. The only buyers of maple syrup by the containerful are “real companies.” Therefore, I would expect rounds-to-zero supply-chain fraud in maple syrup.
But it turns out that the amount of supply-chain fraud in maple syrup is actually quite higher than zero. The chain of custody for cars of maple syrup is much less regimented than you would expect that chain of custody to be. There are smaller buyers of maple syrup — not on the scale of you or me, but on the scales like a boutique maple syrup refinery — who just don’t do as many checks as the large producers or suppliers, et cetera, do. So, it is possible to steal millions of dollars of maple syrup and sell it on the black market, which blew my mind.
This rhymes with how Tide, the well-known detergent in the United States, is used as a commodity on the criminal and semi-criminal/system deal, less criminal undergrounds, in that Tide can be resold. Online marketplaces are getting a lot of the attention, but the traditional way to use Tide as a currency for people who have less access to dollars was to resell the Tide to a corner bodega.
Since the corner bodega can easily verify that the Tide hasn’t been tampered with because the Tide seal is on it, and has basically unlimited willingness to do small-dollar transactions that make money, that was a way to recycle Tide which had been stolen — or which had been acquired by means that were not stealing, but also not exactly the official way of getting Tide — and recycle it into the more or less legitimate economy, insofar as we think that the corner bodega is more or less legitimate, which I think is a complicated story.
And:
COWEN: Why are bank parking lots usually so empty?
MCKENZIE: Oh, this is a straightforward result from queuing theory, if you can believe it. Queuing theory/operation science, by the way, tremendously under-understood by many people to whom it is professionally relevant, be that as it may. When you think of your typical stop-in at a bank, you go in, perhaps you deposit a check, perhaps you talk to the teller. You probably think, “I will have three minutes of dwell time.” So, you expect to be in and out. But the thing that the bank really wants to optimize for is new account opening.
New account opening requires 30 to 60 minutes plus of dwell time, depending on what type of account you are opening. Then when you back out that variability, it turns out that gratuitously over-provisioning the parking space almost all of the time maximizes for not losing new account opening at a few very limited windows per year. Those very limited windows can make or break the branch’s ability to contribute to their larger financial institution.
The number of accounts a bank actually opens per year in terms of checking accounts per branch — that is a number that one can have access to in various places. Depending on the bank and the locality, et cetera, it’s between 200 and 500. So, if you turn away a single customer or two customers in a row to open accounts because you had three parking spaces where you could have had seven, you’ve done a very outsized amount of damage to your financial institution, and thus over-provision the parking in all the places.
Definitely recommended, interesting throughout.
Hester Peirce on the SEC
As she did on the LBRY case (n.b. I was a LBRY advisor), SEC Commissioner Hester Peirce released a statement about the failings of the SEC with regards to the recently approved Bitcoin spot ETPs. It’s rare to read something this brutal coming from the inside.
We squandered a decade of opportunities to do our job. If we had applied the standard we use for other commodity-based ETPs, we could have approved these products years ago, but we refused to do so until a court called our bluff.
…Today’s order does not undo the many harms created by the disparate treatment of spot bitcoin products.
First, our arbitrary and capricious treatment of applications in this area will continue to harm our reputation far beyond crypto. Diminished trust from the public will inhibit our ability to regulate the markets effectively. This saga will taint future interactions between the industry and our staff and will dampen the rich, informative dialogue that best protects investors.
Second, our disproportionate attention on these filings has diverted limited staff resources away from other mission critical work. Over ten years, likely millions of dollars of staff time has gone toward blocking these applications.
Third, our actions here have muddied people’s understanding of what the SEC’s role is. Congress did not authorize us to tell people whether a particular investment is right for them, but we have abused administrative procedures to withhold investments that we do not like from the public.
Fourth, by failing to follow our normal standards and processes in considering spot bitcoin ETPs, we have created an artificial frenzy around them. Had these products come to market in the way other comparable products typically have, we would have avoided the circus atmosphere in which we now find ourselves.
Fifth, we have alienated a generation of product innovators within our space. Our unreasonable approach to these applications has signaled that regulatory prejudice against new products and services can lead us to sidestep the law and unreasonably delay product launches. The industry has logged hundreds of meetings, has filed submissions, withdrawals and amendments, and ultimately had to resort to a costly legal battle to get us to today.
Although this is a time for reflection, it is also a time for celebration. I am not celebrating bitcoin or bitcoin-related products; what one regulator thinks about bitcoin is irrelevant. I am celebrating the right of American investors to express their thoughts on bitcoin by buying and selling spot bitcoin ETPs.[10] And I am celebrating the perseverance of market participants in trying to bring to market a product they think investors want. I commend applicants’ decade-long persistence in the face of the Commission’s obstruction.
Back to the Future: Power Dishwashers!
Why do today’s dishwashers typically take more than 2 hours to run through a normal cycle when less than a hour was common in the past? The reason is absurd energy and water “conservation” rules. These rules, imposed on dish and clothes washers, have made these products perform worse than in the past, cleaning less well or much more slowly. One of the best things that the Trump administration did (other than Operation Warp Speed, of course) was creating a product class–superwashers!–that cleaned in under an hour and were not subject to energy and water conservation standards. The Biden administration reversed these rules but the 5th circuit just ruled that the reversal was “arbitrary and capricious.”
The ruling notes
…the record contains historical evidence that dishwasher cycle time has increased from around one hour at the advent of DOE’s conservation program to around two and a half hours in 2020. See CEI Petition, 83 Fed. Reg. at 17773–74. DOE does not appear to contest this data; in fact, DOE in 2020 appeared to agree that the frustratingly slow pace of modern dishwashers caused consumer substitution away from dishwashers and toward handwashing. See 2020 Dishwasher Rule, 85 Fed. Reg. at 68729; see also Record App’x 3 (noting consumers supported efficacious dishwashers by a margin of 2,200 to 16). And nothing wastes water and energy like handwashing: DOE itself estimated in 2011 that handwashing consumes 350% more water and 140% more energy than machine washing. See Record App’x 5 (citing U.S. Dep’t of Energy, Technical Support Document Docket EE-2006-STD-0127: National Impact Analysis 16 (2011), https://perma.cc/849K-NCX8).
…What did DOE say in response? Basically nothing: It acknowledged the concern and moved on. But bare acknowledgment is no substitute for reasoned consideration.
…the Repeal Rule is arbitrary and capricious for two principal reasons. (1) It failed to adequately consider appliance performance, substitution effects, and the ample record evidence that DOE’s conservation standards are causing Americans to use more energy and water rather than less. (2) It rested instead on DOE’s view that the 2020 Rules were legally “invalid”—but even if true, that does not excuse DOE from considering other remedies short of repealing the 2020 Rules in toto.
More generally AnechoicMedia on twitter wrote:
Water usage restrictions on home dishwashers are a complete non-issue from an environmental standpoint and our inability to overthrow this petty regime is why this country sucks. You cannot provide abundance and prosperity while retaining this wartime rationing mindset.
A position with which I wholeheartedly agree.
Income redistribution through taxes and transfers continues to rise
That is the theme of my latest Bloomberg column, here is the introductory bit:
The broader historical trends show that the US tax-and-transfer system is getting more progressive, including in recent years. And the US government is increasingly redistributing wealth to the bottom half of the income distribution.
And:
The best information indicates that transfer income is rising over time, one example being the increasing numbers of states accepting the expansion of Medicaid under the Affordable Care Act. Even following the Clinton-era welfare reforms, the real resources that US governments (at all levels) sent to the poor continued to increase. Welfare itself became more temporary, but aid for food and child care, among other needs, rose in real value.
In a recent study, Thomas Coleman and David A. Weisbach of the University of Chicago focus on research of tax-and-transfer progressivity and establish some ground rules for judging its reliability: It should measure income comprehensively; look at both taxes and transfers; examine the issue over decades; and make their data available. Under these criteria, only three studies qualify. After scrutinizing that research, Coleman and Weisbach conclude:
Methodological choices produce some differences in the size of their estimates and the size of the trends, but the central story in all these studies is the same: the dominant change in the tax and transfer system over the past half-century has been an increase in transfers to the bottom. … All three studies show that the tax and transfer system has become more progressive and more redistributive.
A good rule for thumb for articles, policy papers, and tweets: if you see the word “gutted” used (but not as a reference to others), the output is likely bad.
Dept. of Uh-Oh
So pleased to see my paper out in the BU Law Review!
This paper surveys 50+ years of randomized control trials in criminal justice and shows that almost no interventions have lasting benefit — and the ones that do don't replicate in other settings. 1/ https://t.co/xIvIcCseGL pic.twitter.com/Duj4ybbbS6
— Megan Stevenson (@MeganTStevenson) January 2, 2024
Why Britain’s economy is failing
In the past five years, the number of applications to connect to the electricity grid — many of them for solar energy generation and storage — has increased tenfold, with waits of up to 15 years. The underinvestment is restricting the flow of cheap energy from Scottish wind farms to population centers in England and adding to the delays for those with high power needs, like laboratories and factories. Laws that give local planning authorities considerable power are blamed for Britain’s shortage of housing and blocking the construction of pylons needed to carry electricity from offshore wind farms. Residents’ objections to noisy construction and changes to the landscapes have been a stumbling block.
With “waits of up to 15 years.” And:
One way the British government turned off investors was by changing planning measures in 2015, and tightening them further in 2018, so that a single objection could upend a planning application — effectively banning onshore wind in England. John Fairlie was a consultant in the wind industry at the time.
Mr. Fairlie is currently a managing director at AWGroup, a land development and renewable energy company that recently got an onshore wind turbine up and running in Bedfordshire, in the east of England, that will generate enough electricity to power 2,500 homes. Because of planning restrictions and grid connection delays, the project took seven years to complete.
That is from the excellent Eshe Nelson in the NYT.
The Everything Token
If you want to understand NFTs and where they are going, The Everything Token by web entrepreneur Steve Kaczynski and Harvard Business school professor Scott Duke Kominers is by far the best guide. 
Kaczynski and Kominers emphasize that NFTs are more than deeds to digital art they are an ideal way to create communities.
Community formation around shared interests has been happening forever, of course. But NFTs turn it up to eleven because of what we call their embedded network superpower:…becoming the owner of an NFT is to some degree an act of affiliation with the brand. Yet NFT ownership doesn’t just connect you with the brand itself, but also with the entire network of individuals who are similarly affiliated….The holders of a given NFT comprise a network of brand enthusiasts just waiting to be activated.
The Everything Token is all about advising brands on what NFTs are, how to understand and navigate the design space and how to active brand enthusiasm. Now you may find ‘activating brand enthusiasm’ pedestrian, perhaps even a little dystopian but Kaczynski and Kominers are correct that this is where the NFT market is going.
When the internet first exploded into public consciousness there was a lot of talk about declaring independence and creating a civilization of the Mind. If you bought into that (I did not, despite lauding the goals) then maybe you think that the internet as we know it today, Google, Amazon, Facebook, Twitter, Spotify and all the rest are a big disappointment. I don’t. I love the new world, even if it isn’t the libertarian paradise that some once promised.
In the same way, NFTs won’t lead to a revolution of the creator class but they are poised to be increasingly adopted by corporations. Corporate adoption will ‘domesticate’ the underlying cryptographic technology. That is, as corporations infuse NFTs into mainstream business models, NFTs will become more user-friendly and accessible and much like the seamless integration into our daily lives of technologies such as Google Maps and digital payments, they will become a ubiquitous part of the digital economy. As NFTs become embedded in various sectors ranging from finance to entertainment, they will reshape how we perceive and interact with digital assets offering innovative and versatile applications that extend well beyond their current scope. It will be fun but don’t expect to liberate the means of production.
Are cities for tourists or residents?
And at what margin?
A new ideological struggle is brewing, yet we have not yet recognized it as such. The question is to what extent cities are for tourists, or for their current residents. Here is a report from Vermont:
A Vermont town known for its autumn foliage has closed its roads to the public for the season, citing an overwhelming amount of influencer tourists.
The select board of Pomfret voted to close Cloudland Road and Barber Hill Road to non-residents from Sept. 23 to Oct. 15. That also blocks access to the popular Sleepy Hollow Farm, a private residence that many tourists try to visit.
New York City has placed severe restrictions on AirBnb, causing hotel room prices to skyrocket. Here is more from Jerusalem Demsas.
Amsterdam has sent out warnings, designed to discourage British tourists from visiting the city for sex, drugs, and drink.
As for the Continent, The Times of London reports:
Beaches, restaurants and estate agents have been attacked by radical anti-tourism groups throughout mainland Spain and the Balearic islands this summer…Flares were let off in restaurants, tourists’ bike tyres were slashed and hooded activists besieged a sightseeing bus.
Venice may be charging day trippers five euros a pop, and I’ve seen calls for raising that price by 5x or more. That is one set of obstacles that probably makes sense, due to congestion and wear and tear on the city itself.
Cruise ships are becoming less popular at many places around the world. How about this from Florida? (NYT):
Activists flooded City Commission meetings, protested on the dock, collected signatures and managed to pass three ballot measures in 2020 imposing stricter controls to protect the marine environment and limit [cruise ship] passengers to 1,500 a day…
Maybe this one is a coincidence, but Japan is hiking the price of its bullet train pass for tourists by seventy percent.
China is schizophrenic on tourism, on one hand easing visa requirements but on the other managing payments in the country isn’t getting easier.
Obviously the right answers here are on a case-by-case basis. But political economy tells us that chosen policies will tend to overemphasize the interests of the voting residents, and underemphasize the interests of the visitors.
Plenty of these anti-tourist stories are making the news, but we’ve yet to see this part of a more systemic pattern. And that pattern is going to intensify, if only because voters are aging, nationalism is ascendant, and protectionist sentiment is on the rise.
I am also pleased to tell you all that the world is full of underexplored spots — try Salta or Kosovo for a start. Or in a major, heavily-touristed city of your choice, just walk ten or fifteen minutes away from the beaten track, if that.
It is snobby and elitist and self-satisfying to speak up against tourism, but in the future we will need a movement to defend the practice.
A City Not a Museum
Good Binyamin Appelbaum piece on the difficulties of building in NYC. The data will be familiar but I especially appreciate this vibe which we need more of:
I hope someday I’ll be walking with my children on the Lower East Side or the Upper West Side or Brooklyn Heights. We’ll pass one of the places where my ancestors lived, and the building will be gone. In its place will stand an apartment building, housing a new generation of New Yorkers.
See also my piece Against Historical Preservation where I wrote:
…a confident nation builds so that future people may look back and marvel at their ancestor’s ingenuity and aesthetic vision. A nation in decline looks to the past in a vain attempt to “preserve” what was once great. Preservation is what you do to dead butterflies.
Uber and Traffic Fatalities
Abstract: Previous studies of the effect of ridesharing on traffic fatalities have yielded inconsistent, often contradictory conclusions. In this paper we revisit this question using proprietary data from Uber measuring monthly rideshare activity at the Census tract level. Using these more detailed data, we find a consistent negative effect of ridesharing on traffic fatalities. Impacts concentrate during nights and weekends and are robust across a range of alternative specifications. Overall, our results imply that ridesharing has decreased U.S. traffic fatalities by 5.4% in areas where it operates. Based on conventional estimates of the value of statistical life the annual life-saving benefits are $6.8 billion. Back-of-the-envelope calculations suggest that these benefits are of similar magnitude to producer surplus captured by Uber shareholders or consumer surplus captured by Uber riders.
The authors, Michael Anderson and Lucas Davis, note that alcohol involvement is reported in approximately 30% of fatal crashes, which is an amazingly high number unless you think a lot of people are driving drunk. I am reminded of a clever paper by Levitt and Porter who use the proportion of crashes involving two drunk drivers to estimate that it is not that lots of people are driving drunk but rather that “drivers with alcohol in their blood are seven times more likely to cause a fatal crash” and “legally drunk drivers pose a risk 13 times greater than sober drivers.” Thus, substituting a sober driver for a drunk driver is a very good thing and so it’s plausible to me that Uber significantly reduces traffic fatalities.
Consider this a public service announcement.
U.S. high-skilled immigration
Major win for the US on high-skilled immigration policy:
“USCIS data show that the number of O-1A visas awarded in the first year of the revised guidance jumped by almost 30%
The number of STEM EB-2 visas after a ‘national interest’ waiver shot up by 55%” pic.twitter.com/PhIvdVxm2K
— Alec Stapp (@AlecStapp) December 30, 2023
Toothpick producers violate NYT copyright
If you stare at just the exact right part of the toothpick, and measure the length from the tip, expressed in terms of the appropriate unit and converted into binary, and then translated into English, you can find any message you want. You just have to pinpoint your gaze very very exactly (I call this “a prompt”).
In fact, on your toothpick you can find the lead article from today’s New York Times. With enough squinting, measuring, and translating.
By producing the toothpick, they put the message there and thus they gave you NYT access, even though you are not a paid subscriber. You simply need to how to stare (and translate), or in other words how to prompt.
So let’s sue the toothpick company!
By the way, I hear they are sending Barbara Eden to jail…
The Sullivan Signal: Harvard’s Failure to Educate and the Abandonment of Principle
The current Harvard disaster was clearly signaled by earlier events, most notably the 2019 firing of Dean Ronald Sullivan. Sullivan is a noted criminal defense attorney; he was the director of the Public Defender Service for the District of Columbia and he is the Director of the Criminal Justice Institute at Harvard Law School, he advised President Obama on criminal justice issues, he represented the family of Michael Brown. He and his wife were the first black Faculty Deans in the history of the college.
Controversy erupted, however, when Sullivan joined Harvey Weinstein’s legal defense team. Student protests ensued. The students argued that they couldn’t “feel safe” if a legal representative of a person accused of abusing women was also serving in a role of student support and mentorship. This is, of course, ridiculous. Defending an individual accused of murder does not imply that a criminal defense attorney condones the act of murder.
Harvard should have educated their students. Harvard should have emphasized the crucial role of criminal defense in American law and history. They should have noted that a cornerstone of the rule of law is the presumption of innocence and the right to a fair trial, irrespective of public opinion.
Harvard should have pointed proudly to John Adams, a Harvard alum, who defied popular opinion to defend hated British soldiers charged with murdering Americans at the Boston Massacre. (If you wish to take measure of the quality of our times it’s worth noting that Adams won the case and later became president—roughly equivalent to an attorney for accused al-Qaeda terrorists becoming President today.)
Instead of educating its students, Harvard catered to ignorance, bias and hysteria by removing both Sullivan and his wife from their deanships. Harvard in effect endorsed the idea, as Robby Soave put it, that “serving as legal counsel for a person accused of sexual misconduct is itself a form of sexual misconduct, or at the very least contributes to sexual harassment on campus.” Thus Harvard tarred Sullivan and his wife, undermined the rule of law and elevated the rule of the mob. Claudine Gay, then Dean of the Faculty of Arts and Sciences, contributed to the ignorance, bias and hysteria. (It’s also notable, that Sullivan also criticized Harvard’s handling of the investigation of Roland Fryer as being “deeply flawed and deeply unfair.” This may have been Sullivan’s real sin, as the investigation of Fryer was under Dean Claudine Gay.)
Thus, we see in the Sullivan episode disregard for free speech, unprincipled governance in which different rules are applied to different actors in similar situations, and a bending to the will of the mob, all issues which have repeated themselves under the Gay regime. Sad to say, however, that these flaws were not so much ignored at the time as lauded.
Harvard followed the mob and when the mob turned and the season changed it had left itself no defense.
Addendum: See also Tyler, My thoughts on the Harvard mess.