U.S. government investigators increasingly believe that Chinese state hackers were most likely responsible for the massive intrusion reported last month into Marriott’s Starwood chain hotel reservation system, a breach that exposed the private information and travel details of as many as 500 million people…
Story here. And:
Armed with a rich array of personal data, an intelligence agency can also tailor an approach to a person to see whether the individual can be recruited as a spy or blackmailed for information. The passport data, which is not often collected in data breaches, probably was a particularly valuable find for the hackers.
You will note that no one is trying to sell the data. And this:
The report, citing two people briefed on the investigation, reported China had launched an intelligence-gathering campaign which included hacking into health insurance companies and hacking security clearance files of millions of people living in the U.S. The New York Times reported the hackers are believed to be employed by the Ministry of State Security, which is China’s spy agency. The paper noted that the revelation that China was behind the Marriott hack comes as the U.S. government is gearing up to launch actions against China’s trade that include indicting Chinese hackers that work for the government. The New York Times noted the Marriott hacking isn’t expected to be part of the indictments but does add a sense of urgency to the moves the White House was mulling.
The Trump administration is also planning on declassifying intelligence reports that show China had been trying to create a database of American executives and government officials that have security clearances, reported The New York Times.
I could go on. I am genuinely unsure what are the economic costs of these mischievous activities, but would note simply that it is sometimes necessary to punch back. The choice is not free trade vs. protectionism (I strongly suspect Scott and I agree on the economics of trade), but rather a partial return punch now vs. a worse situation much later on.
Senate Democrats are pushing back against attempts to pass a compromise bill in the lame-duck session that could speed the introduction of driverless cars onto U.S. roadways, saying it lacks safeguards that would protect drivers.
Link here, and I’m sure you know the House Democrats don’t want to pass the new NAFTA.
Elsewhere, in Chicago, the war on democracy continues:
To get on the ballot, Krupa was required to file 473 valid signatures of ward residents with the Chicago Board of Elections. Krupa filed 1,703 signatures.
But before he filed his signatures with the elections board, an amazing thing happened along the Chicago Way.
An organized crew of political workers — or maybe just civic-minded individuals who care about reform — went door to door with official legal papers. They asked residents to sign an affadavit revoking their signature on Krupa’s petition.
And the background?:
The David is David Krupa, 19, a freshman at DePaul University who drives a forklift part time. He’s not a political powerhouse. He’s just a conservative Southwest Side teenager studying political science and economics who got it in his head to run for alderman in a race that pits him against the most powerful [Democratic] ward organization in Chicago.
Here is the story, it’s not just North Carolina where electoral law is treated with less than the utmost respect.
p.s. if you think or write “false equivalency” in response to this post, you fail the Intellectual Turing test.
That is the topic of my latest Bloomberg column, here is just one short excerpt:
In the longer run, bringing charges against Meng is likely to accelerate the division of the world into two competing systems of law, technology and commerce — namely those of China and the U.S. That will encourage international relations to develop along the dimension of power — what can you get away with? — rather than law or orderly cooperation. The West’s dirty little secret is that the rule of law works well only when tempered with a high degree of discretion.
At the margin, the legal reach and police power of the U.S. can always be invoked to fight another crime or resolve another corruption problem. Don’t like how FIFA — the international soccer federation — is being run? Get the U.S. in on the act. There are in fact laws that gave the U.S. jurisdiction over bad FIFA practices (wire fraud, racketeering, and money laundering), and the Department of Justice led a successful anti-corruption case starting in 2015.
That enforcement action seems to have gone fine, but where to stop? There a lot of wrongdoers who are connected, in one way or another, to the U.S. financial system. But America has more credibility as global policeman when it focuses on only the most pressing cases, such as when innocent victims are being killed.
Best yet, I offer remarks on Brexit as well.
A splendid book, why can’t the rest of you ****ers write books this good? Here is one bit:
…the dynamics of clan works in a significantly different way in Somaliland from the way it does in south-central Somalia. A single clan-family, the Isaaq, occupy the central areas of the territory, and account for by far the greater part of its population. Though the Isaaq clans, inevitably, are divided both between and within themselves, they provide a reasonably solid ethnic core, that contrasts with the far more mixed and complex composition of southern Somalia, with its two major clan-families, Darood and Hawiye, and the further problems created by the presence of the Digil-Mirifle and other minority groups. Somaliland is by no means entirely Isaaq…but its demographic structure means that other clans must either accept Isaaq hegemony and work within it, or else reject the Somaliland state altogether. They cannot expect to control it. At the same time, the fact that the Isaaq clans — characteristically of Somali clan politics — do not form a single united bloc provides other clans with the opportunity to build alliances with one or another group of the Isaaq.
Have you ever wanted to read about how ethnic groups in Ethiopia, Eritrea, and Djibouti fit into this same broad picture? Just exactly how Somalian and Ethiopian history intersect, from the 1970s onwards? This here is your book. I’m running to Amazon right now to buy more from this wonderful author. You can buy it here.
Here is the audio and transcript, Paul was in top form and open throughout. Yes economic growth, blah blah blah, but we covered many related topics too:
COWEN: And you also think we should simplify the English language. Right?
ROMER: [laughs] Well, there’s two parts to that. One is, in writing and communication, there should be a very high priority on clarity. It’s hard to know what’s the mechanism that enforces that. There are variants on English, like the English used to write the manuals people use to service airplanes, where there’s a very restricted vocabulary. The words are chosen so that you can’t have any ambiguity because you don’t want somebody servicing a plane to get confused. So there are some things you could do on writing, word choice, vocabulary, exposition.
There’s a separate issue, which is that amongst the modern languages, English has the worst orthography, the worst mapping between spelling and sounds of any of the existing languages. And it’s a tragedy because English is becoming the universal second language.
The incidence of people who don’t learn to read is substantially higher in English than in other languages. People have known for a long time, it takes longer to learn to read in English because of the bad orthography. But what hasn’t gotten enough attention is that there’s an effect on the variance as well. There are more people who never get over this hurdle to actually learning to read.
If there were a way to do in English what they’ve done in other languages, which is to clean up the orthography, that could make a huge difference in the variation associated with whether or not people can learn to read English.
COWEN: Can a charter city work if we import good laws from the outside world but not the appropriate matching culture?
ROMER: You’ve zeroed right in on the connection. The real motivation that I had for charter cities was exactly this one that you can see in the US versus New Zealand. You can think of a charter city exercise . . .
This is actually the story of Maryland: We’re going to create laws, and we’re going to guarantee freedom of religion in Maryland, and it’s in the laws; it’s in the institution somehow. That didn’t turn out very well. Maryland had a Catholic elite but then large numbers of Protestant indentured servants or workers. And this kind of commitment to freedom of religion was not stable in Maryland at all.
The case that’s worth trying to copy is Pennsylvania, where William Penn recruited large numbers of people who actually believed in freedom of religion. The word charter comes from the charter that Penn wrote for Pennsylvania, but it wasn’t the document that mattered. What mattered was that there were a bunch of people in the founding population who were committed to this idea of a separation of church and state and religious freedom. And that’s what made it durable in Pennsylvania in a way it wasn’t in Maryland.
ROMER: …Moses was of this generation that was too enamored of the car, and this is where I think Jacobs had a better intuition. But the challenge, the dichotomy I would pose would be Jane Jacobs versus Gouverneur Morris.
Morris was the guy who drew the grid that laid out the rectangular street map for Manhattan.
We also discussed music, including Hot Tuna, Clarence White, and Paul’s favorite novel, dyslexia, what Paul has learned about management, and much more. Self-recommending, if there ever was such a thing.
The first bit is mine, the second is his commentary, link here:
[TC] This [China] is an issue that predates Trump, and he deserves some credit for doing something to help solve it.
[SS] Everything in that paragraph is completely correct–except the last portion of the final sentence, which is wrong.
Scott’s is a common view in free market circles, so it’s worth outlining why I see things differently. Like it or not, the United States is the global hegemon. In my view this is an overall positive, but for our purposes today let’s just take it as given.
If you are the global hegemon, and another country, largely hostile to your political values and geopolitical desires, engages in widespread subversion of your power and influence, you must in some way hit back. Otherwise you will not be global hegemon for much longer. And unlike India or the EU, China desires to build an international political and economic order which would destroy liberalism as we know it. Imagine a world where autocracy is a much more widespread norm, the Xinjiang detentions and North Korean nuclear weapons are considered entirely appropriate behavior, Taiwan is a vassal state, and few Asian countries could allow their media to print criticism of the Chinese government, for fear of retaliation. Institutions such as the WTO would persist only insofar as they created loopholes which gave China the benefits of membership without most of the obligations.
Did I mention that politics in Australia and New Zealand are subverted regularly and blatantly by Chinese influence and money? Very likely the same is underway in the United States (and other countries) right now.
You can put aside trade practices altogether, and simply look at the extreme and still under-reported degree of espionage and spying conducted by China, aimed at major U.S. corporations. It’s not quite an act of war, but it is not the classical model of trade either (“Mercantilism is bad…what’s wrong if they send us goods and we just send them back paper dollars?”). China is violating U.S. laws on a massive scale, and yes, I am sorry to say, trade is our main way of “reaching” them and sending a message.
Some kind of push back is needed, and I find it striking how much Westerners — and this includes free market types — who have lived in China full-time tend to agree with this conclusion. It is also striking how many market-oriented economists, usually from the outside, don’t talk much about this issue at all.
That said, I fully agree that Trump has a poor understanding of economics, he is incapable of building the proper alliances, the benefits from Trump’s actions are likely to be marginal, and perhaps the best case scenario is simply that his provocations cause the Chinese to think twice before proceeding further along their current path.
Scott’s comparisons are with the EU and India, neither real rivals of the United States nor intended subverters of the Western economic order. His p.s. is the part of his post that comes closest to my view:
PS. There may be a few national security issues with China where sanctions are appropriate. I’m no certainly expert on high-tech espionage. But that’s only a tiny faction of the trade dispute, and if it is a problem is better addressed through sanctions targeted at specific high-tech companies like Huawei.
I would have written “PS: For China, everything is a national security issue. It is neither stable nor desirable for the world’s other major power to take exactly the opposite view.”
The excellent Jason Brennan with a short introduction to his new book, When All Else Fails: The Ethics of Resistance to State Injustice:
Imagine a situation in which a civilian commits an injustice, the kind against which you believe it is permissible to use deception, subterfuge or violence to defend yourself or others. For instance, imagine your friend makes an improper stop at a red light, and his dad, in anger, yanks him out of the car, beats the hell out of him, and continues to strike the back of his skull even after your friend lies subdued and prostrate. May you use violence, if it’s necessary to stop the father? Now imagine the same scene, except this time the attacker is a police officer in Ohio, and the victim is Richard Hubbard III, who in 2017 experienced just such an attack as described. Does that change things? Must you let the police officer possibly kill Hubbard rather than intervene?
Most people answer yes, believing that we are forbidden from stopping government agents who violate our rights. I find this puzzling. On this view, my neighbours can eliminate our right of self-defence and our rights to defend others by granting someone an office or passing a bad law. On this view, our rights to life, liberty, due process and security of person can disappear by political fiat – or even when a cop has a bad day. In When All Else Fails: The Ethics of Resistance to State Injustice (2019), I argue instead that we may act defensively against government agents under the same conditions in which we may act defensively against civilians. In my view, civilian and government agents are on a par, and we have identical rights of self-defence (and defence of others) against both. We should presume, by default, that government agents have no special immunity against self-defence, unless we can discover good reason to think otherwise.
I think it helps in answering this question to think of other countries say South Africa under Apartheid or China today among the Uighur in Xinjiang province…then be consistent. Note that resistance to state injustice may be unwise even when it is ethical.
That is the topic of my latest Bloomberg column, here is one excerpt:
The basic problem with any U.S.-China trade conflict is that there is not very much the Chinese are interested in offering, and their intransigence is more than just a bargaining stance. They are willing to buy more American soybeans and manufactured goods (and probably wish to anyway), and they might give U.S. financial institutions freer rein within China. But they won’t dismantle their system of state-owned enterprises, as those companies are among China’s most powerful special interest groups. Nor will China give the major U.S. tech companies free rein in China, if only for reasons of national security and China’s desire to build a surveillance state based on data controlled by China.
Overall, the grievances on the U.S. side are significant, and the possible concessions on the Chinese side are minor. So the most likely outcome is only modest progress in difficult negotiations. It’s also likely that the power and focus of the Trump administration will wane as it deals with investigations from the new Democratic-controlled House of Representatives. It might be said that the trade war you now see is the trade war you are going to get. Foreign relations gridlock will set in.
Nonetheless, it’s not quite fair to describe the trade war with China as a problem that Trump started and then pretended to solve. The reality is that hostility toward Chinese trade practices has been building for some time. Anti-China measures have long commanded bipartisan support not only in Washington but also among corporate leaders, who see themselves as victims of unfair Chinese trade practices and espionage. This is an issue that predates Trump, and he deserves some credit for doing something to help solve it.
Do read the whole thing, which contains other points of interest.
That is the new and excellent book by Alain Bertaud, so many pages have excellent food for thought. Here is one simple bit:
Cities are primarily labor markets.
…large cities are growing at about the same rate as medium and small cities in the same countries or regions. It seems that cities’ growth rates follow Gibrat’s law of proportionate effect, which states that the size of a city is not an indicator of its future growth rate — that is, cities’ growth rates are random, with the same average expected growth rate and same variance…The population of larger cities keeps growing, but on average, so do smaller cities. This seems paradoxical, given that larger cities are more productive than smaller ones. However, larger cities do not play the same economic role as smaller ones do. They complement each other’s activities. The increase productivity of larger cities is therefore linked to the existence and growth of smaller cities. In turn, smaller cities’ economic growth is dependent on larger cities’ innovations and inventions.
How about this:
In 1830…London’s population density had reached a very high density of 325 people per hectare. By 2005, however, the density of London had decreased to only 44 people per hectare. The larger decrease in London’s density has not caused a corresponding decrease in mobility. On the contrary…
I learned a great deal from the discussion (starts p.287) of Indonesia’s “kampungs,” and how the Indonesian has managed their integration with local infrastructure relatively well. In contrast, this is the common alternative procedure:
The predictable first reaction of governments has usually been to set minimum urbanization standards to prevent the legal construction of these unsanitary urban villages. The regulations made the situation worse, as they prevented these informal settlements from obtaining normal urban services from the municipality. They also created a risk of future demolition, which discourages housing improvement that the households would have naturally done themselves. Eventually, many governments slowly regularized the older informal settlements in a piecemeal fashion, as is the practice in India, for instance. But the regularization of informal settlements usually had been conducted with a provision that after a set date, no more informal settlements would be regularized.
The outcomes of these successive policies — first ostracism, then benign neglect followed by reluctant integration — has been disastrous. A significant share of the urban labor force, otherwise gainfully employed, live in large “informal” settlements often with unsafe water supplies, deficient sanitation, and sporadic solid waste collection.
What made a difference [in Indonesia] was a decision taken in 1969 by the government of Indonesia to concentrate its resources on the improvement of the kampungs’ infrastructure without trying to remove or restructure the existing housing, however small or inadequate it was…And, even more exceptional, since 1969 to this day, the Indonesian government’s support for KIP has been unwavering…The government housing policy objective consists of allowing the poor to settle in and around existing villages at the standards of their choice, while the government concentrates its efforts not on housing construction but on gradually improving residential infrastructure and services to all residential settlements. The policy has proved largely successful.
Later in the book, pp.351-352 have a fascinating discussion of how relatively good urban/suburban policy, and also the fragmentation of municipalities, contributed to the early success of the tech community in Silicon Valley.
The actual title starts with: “Gordon Tullock Meets Phineas Gage:”, and here is the abstract:
In the late 1940s, the United States experienced a “lobotomy boom” where the use of the lobotomy expanded exponentially. We engage in a comparative institutional analysis, following the framework developed by Tullock (2005), to explain why the lobotomy gained popularity and widespread use despite widespread scientific consensus it was ineffective. We argue that government provision and funding for public mental hospitals and asylums expanded and prolonged the use of the lobotomy. We support this claim by noting the lobotomy had virtually disappeared from private mental hospitals and asylums before the boom and was less used beforehand. This paper provides a more robust explanation for the lobotomy boom in the US and expands on the literate examining the relationship between state funding and scientific inquiry.
Pay toilets are common in Europe but uncommon in the United States. Sophie House writing at City Lab explains why. Pay toilets were made illegal in much of the United States in the 1970s:
In 1969, California Assemblywoman March Fong Eu smashed a porcelain toilet with an axe in front of the California state capitol, protesting the misogyny of restrooms that charged entrance fees for stalls but not urinals. She was not alone in her frustration. The grassroots organization CEPTIA—the Committee to End Pay Toilets in America—mobilized against pay toilets, putting out a quarterly newsletter (the Free Toilet Paper) and exchanging warring pamphlets with Nik-O-Lok, the leading pay-toilet manufacturer. The group won a citywide ordinance banning pay toilets in Chicago in 1973, followed by bans in Alaska, California, Florida, Illinois, Iowa, Michigan, Ohio, New Jersey, New York, Tennessee, and Wyoming.
The logic seems to be if we cannot sit for free then you cannot stand for free. House calls the pay toilet ban a triumph over sexism. Is it so hard to understand why urinals are cheaper to operate and more difficult to lock than stalls?
In any case, CEPTIA was remarkably effective. In 1970 there were some 50,000 pay toilets in America and by 1980 there were almost none. The attentive reader, however, will not be surprised to learn that smashing the pay toilet conspiracy did not result in an abundance of free toilets.
In the decades since CEPTIA disbanded, however, pay-toilet bans have proven to be a Pyrrhic victory. The committee’s vision of free toilets for all never came to pass. Cities have persistently refused to construct public restrooms, and existing facilities have fallen into disrepair. Citing the difficulty of keeping bathrooms safe and clean, municipalities are often unwilling or unable to pay. Even assuming that funds are available for initial construction of public toilets, the maintenance and operating costs are a deterrent.
By contrast, in cities from Europe to India to Latin America, small entrance fees help to cover the costs of keeping facilities in good condition. Creating a similar revenue stream to defray operating costs would likely make pay toilets more attractive to U.S. municipalities. For example, fees could offset the costs of hiring restroom attendants—an excellent, but expensive, way to keep bathrooms safe. Pay toilets also redistribute the operating costs of restrooms. Free toilets are, of course, taxpayer-funded, while under pay-toilet schemes, tourists who use urban infrastructure also contribute to its functioning.
Daredevil on Netflix: Season 3 is excellent. A fight scene (in the prison) is as good as the famous hallway scene in Season 1. Another stellar performance by Vincent D’Onofrio. A good plot and a satisfying filling in of Karen’s backstory. Sophisticated visuals and use of sound.
That was my tweet. One thing that did annoy me was the prominent reliance of the writers on the Thou Shall Not Kill trope. Foggy even says “once you cross that line, there’s no return”. Ugh, give me a break. The trope is tired and it also annoys me as an economist. Daredevil has been in a lot of fights and with probability approaching 1 he has already killed. Did none of those prison guards or cops have thin skulls? And why should there be a line? Is killing two people with expected probability of 1/2 really so much better than killing one person with expected probability 1?
As I thought about this more, however, the Thou Shall Not Kill trope is least objectionable in Daredevil. Daredevil is a serious Catholic and can thus call upon Thomas Aquinas’s Doctrine of Double Effect. Aquinas argues that:
moral acts take their species according to what is intended, and not according to what is beside the intention…
Thus, Foggy, the ever-precise lawyer, is correct. Catholic doctrine draws a line between intending to kill and expecting to kill. Expecting to kill is ok, intending to kill is not. I am not a fan of the doctrine of double effect as among other flaws it too easily allows people to shrug off war crimes and the killing of innocents (heh, we only intended to kill the groom, the fact that we also killed the soon-to-be wife and guests, well that was beside the intention). Nevertheless, I will allow that the doctrine of double effects gets the Daredevil writers off the hook for inappropriate use of cliche. Batman, however, has no excuse.
Addendum: For an excellent review of Daredevil Seasons 1-3 from the point of view of Christianity, see this post at Christ and Pop Culture.
The $29.8 billion Americans spent on the lottery in 1995 worked out to about $112 per capita. Today, per capita spending is up to $225 dollars a year. Again, part of that is the result of more states jumping on the lotto bandwagon.
These are per capita figures, accounting for every man, woman and child in the country. The average lottery player spends quite a bit more than that: If we subtract the 73 million people under age 18, and divide the remaining 250 million in half (since only 49 percent buy a lotto ticket in a given year), it works out to $600 a year in expenses for the average lotto player. Some survey data show that a disproportionate share of regular lottery players fall into low-income brackets.
…Massachusetts leads the nation with an astonishing $767 in annual per capita lotto spending. It’s followed by West Virginia ($594), Rhode Island ($513), Delaware ($421) and New York ($421).
Here is the story by Christopher Ingraham.
In New York it costs billions of dollar per mile to build new subways, a price far higher than anywhere else in the world. That’s one reason why Elon Musk’s The Boring Company has been anything but. Even if hyperloop technology doesn’t pan out, Musk’s goal of reducing tunneling costs by a factor of ten is laudable. The Boring Company purchased a tunnel boring machine in April of 2017 and incredibly has already completed a two-mile test-tunnel underneath Hawthorne, LA! Awesome, right? Well, some people just can’t be happy.
“[I]nvaders are coming from underground” proclaims Alana Semuels in a big story in The Atlantic. The title and splash page indicate the theme:
The billionaire is drilling for futuristic transit under Los Angeles. He didn’t have to ask the neighbors first.
Billionaires are undermining your home. And democracy! Grab your pitchforks! Yet dig a little deeper underneath the lurid headline and the actual complaints are–dare I say it–boring.
I talked to a dozen people who live along the tunnel’s route, and most said they hadn’t witnessed any extra noise or traffic. But none had been informed ahead of time that a private company would be digging a tunnel beneath the street.
But what about all the displaced people?
As the tunnel neared completion, disruptions to the community increased. The company bought another building, this one on the corner of 120th Street and Prairie Avenue, for $2 million, according to public records, to allow for the extraction of tunneling equipment. Adrian Vega had run a cabinet business in that building for 18 years. When his landlord sold the building, the Boring Company came in and offered Vega’s company, Los Vegas Kitchen Cabinets and Doors, extra cash to get out in three months. Vega took the money, and asked for even more time from the Boring Company, which he was granted. But he couldn’t find another space; since moving in August, his business has been closed and his customers don’t know that he’s moved, he told me.
…Shunyaa Turner lives in a small house on 119th Place with his wife and two kids. He said that in the past year, they’ve had to battle more pests, such as raccoons, mice, skunks, and opossums, which they’ve never seen before. He isn’t sure if this is related to the digging; the Hawthorne airport has also been doing more construction as it gets busier, so the animals could have fled from there. He and his wife said they’ve also noticed more cracks in their impeccably maintained walkway.
…The initial document also claimed that the test tunnel would not involve digging under private property, but that, too, has changed—though the company has now bought all the private property it is tunneling underneath. The company has also closed a lane of Jack Northrop Avenue, a street on the other side of SpaceX headquarters
In the author’s own words:
Meanwhile, in Hawthorne, the company that promised its transit test projects would be completely unnoticeable by the community has since uprooted a small business, purchased a house, and closed a lane of traffic indefinitely.
The whole framing of the piece is ass-backwards. Semuels is correct that:
[this] would have been unimaginable in a higher-income neighborhood. Indeed, when Musk tried to build another underground tunnel in a wealthier neighborhood in West L.A., residents quickly sued. The project got tied up in court, and [died].
The CEQA allows residents 35 days to push back against granted exemptions…in Hawthorne, the 35-day window passed with little fanfare.
But unfortunately Semuels takes the posh, lawsuit-loving, NIMBY crowd as the appropriate normative standard and any deviations from that as suspect and indicative of the power of billionaires to run roughshod over other people’s rights. Instead, the Boring Company, the Hawthorne city government, and the people of Hawthorne should be applauded for their sensible, forward-thinking, and optimistic approach to new ideas. Bravo to Hawthorne! Hawthorne: Where the future is being made!
I do give Semuels credit, however. She writes honestly so that one can see the real story behind the false frame and she even tips the audience to the correct (Straussian?) reading in her final clever paragraph.
Vega [the owner of the cabinet business who was paid to vacate] has nothing negative to say about the Boring Company—he just blames himself for agreeing to be out so quickly. Nothing like this had ever happened to him before, so he didn’t know what was fair. Nor did he know how hard it would be to set up a new store—the process of getting new city permits, he said, is a lengthy one, and he can’t find a way to cut through the red tape.
From my time in both the military and healthcare I can say that the biggest problem are the compliance costs.
For example, I have a phone app that allows me to send texts. We pay very good money to have said app. It does nothing that my phone cannot innately do – except be HIPAA compliant. EMR software is clunky, an active time suck, and adds little or no value … but we are required by law to use it. In each case there are scads of less specific programs out there which are insanely cheaper and more functional, but those programs cannot justify the costs of becoming compliant for a small niche of their business.
In the military we had similar difficulties. If you want systems to be secure, you need to pay extra as the marketplace does not do real security for consumer goods. Likewise, if you worry about logistical tails, building in assured access drastically increases costs.
And I fully suspect that prices will continue to diverge. As ever more of the internet ends up in a giant interconnected mess there will be fewer people able to code in a secure fashion. There will be fewer parts of the ecosystem that can be used by security conscious actors.
Then we get to actual procurement itself. People worry that arcane institutions will somehow make off with lots of money and spend it either poorly or nefariously. Absent easily observed price and cost data in both sectors we began developing rules. These rules drive firms out of the market (e.g. we needed some light interior remodeling to comply with a regulation that specified inches between things, the contractor who has been most affordable and highest quality refused to bid because the hassle on his side was too great). Eventually the rules become too complicated and you start needing specialists to interpret them. Costs skyrocket and firms abuse rules to pad profits. Then the lawyers get involved and things get more expensive. Again, medical and military consumers become a captive market facing greater monopoly as fewer firms can navigate the thicket of rules to even try to make money.
Then we have the problem that people look at these sectors and say that it is public money. All public money should help with goal X (e.g. going “green”, affirmative action, boycotting South Africa/Israel, patriotism, “America first”) and then we become even more overly constrained. Find vendors who meet one hurdle is hard, finding ones that meet 30 is nigh unto impossible unless the vendor is engineering the firm to market solely to this niche – and charging monopoly rates as his reward.
Any single thing would not be too bad for prices, but the marketplace in general is diverging from military and healthcare. Even education is diverging with mandates in FERPA and political business constraints. We have pretty effectively restricted supply, why exactly would we not expect an increase in cost?
That is from “Sure.”