Month: June 2014

Hugo Chavez, once
a darling of the Hollywood left, tried to transform Venezuela
into a socialist paradise using chavismo, a
Chavez-centered “top men” kind of socialism and nationalism while
it’s president from 1999 to 2013. Less than fifteen months after
his death, his successor, Nicolas Maduro, has revealed just how
much star power and personality can mask failure.

Bloomberg reports on the oil-rich country’s
latest shortage:

Residents of the Venezuelan capital of Caracas, who already
struggle to find toilet paper and deodorant, are facing a new
shortage — drinking water. 

The rationing of tap water amid a drought and a shortage of
bottles because of currency controls are forcing people to form
long lines at grocery stores and bottle shops as soon as deliveries
are made. Truck drivers spend much of their day outside water
dispatch centers as they try to meet demand.

As the economy he and his government are trying to control with
a stranglehold collapses around them, Maduro claims his opponents
are trying to kill him, an attempt to shore up support for his
leadership. Such a tactic was common under Chavez as well.
As
Juan Nagel at Caracas Chronicles explains:

When Hugo Chávez was alive, every time there were tiffs or
differences inside the government, out came the wild accusations of
“magnicidio” to stir the pot. By driving a wedge between
“they” (the assassins, which I guess includes all of us) and “us”
(the revolutionaries), the government thinks it can consolidate its
own factions. They seem to be saying “look, we may be incompetent
crooks who are destroying the country, but they are worse than us …
they want to kill us!”

It’s a cheap ploy, and it won’t work. In the face
of unstoppable inflation, straws seem to be the only
thing the government has to grasp on to.

The worst part is that some chavistas will fall for this. They
have lost the capacity to ask themselves why the government claims
an assassination has been thwarted and yet nobody is in prison.

The ability of central planning to turn abundance (Venezuela
is water-rich, too) into scarcity is unrivaled, despite claims
by its advocates that actually allowing suppliers and consumers to
buy and sell in free markets (“capitalism”) is the true culprit.
Yet the leaders of planned economies can often rely on this
delusion, and the emotional reactions they can elicit by demonizing
capitalism and their opponents, to deny economic reality.

Last week
Habersham County, Georgia, Sheriff Joey Terrell,
explaining how a SWAT team critically injured 19-month-old
Bounkham Phonesavanh by tossing a flash-bang grenade into the
toddler’s playpen during a 3 a.m. drug raid on Wednesday, said
members of the team, which consisted of his deputies and local
police officers from Cornelia, never would have used such a
“distraction device” if they had realized children were living in
the home they were attacking. “If there’s children involved in a
house, we do not use any kind of distraction devices in those
houses,” Terrell told
AccessNorthGa.com. “We just don’t take the chance on
it….According to the confidential informant, there were no
children. When they made the buy, they didn’t see any children or
any evidence of children there, so we proceeded with our standard
operation.”

But according to a lawyer hired by
Bounkham’s parents, Boun Khan and Alecia
Phonesavanh, even the most rudimentary surveillance would have
revealed the presence of children in the house near Cornelia, which
belongs to the couple’s relatives. The Phonesavanhs moved
there with Bounkham and his three older sisters after their
home in Wisconsin burned down. “They had been in this
home for about two months,” the lawyer, Mawuli Mel Davis,

told WSB-TV, the ABC station in Atlanta. “This is a
stay-at-home dad who was out in front of the home, playing with the
children on a daily basis. Any surveillance that was done would
have revealed there was a father with four children who played in
that driveway.”

By Terrell’s own account, the
SWAT team was relying on the report of a confidential informant who
briefly visited the home on Tuesday night, just a few hours before
the raid, and bought methamphetamine from Wanis Thonetheva, a
nephew of the home’s owners. “There was no clothes, no toys,
nothing to indicate that there was children present in the home,”
Cornelia Police Chief Rick Darby
claimed. “If there had been, then we’d have done something
different.” But Alecia Phonesavanh
says anyone visiting the home should
have noticed signs of children. “They say there were no toys,”
she
told The Atlanta Journal-Constitution. “There is
plenty of stuff. Their shoes were laying all over.”

Bounkham, who was severely burned when the flash-bang grenade
exploded in his face, is undergoing
surgery today for the second time. His
parents told the Journal-Constitution that
doctors say he has a 50 percent chance of surviving. The
Phonesavanhs, who have no health insurance, are collecting contributions
to cover Bounkham’s medical expenses.

Despite an avowed policy of not using flash-bang grenades
when children are present, it seems that neither Terrell’s office
nor the Cornelia Police Department did anything to investigate that
possibility aside from asking the informant, who obviously was
wrong. Beyond the lack of due diligence on that point, there is the
question of whether tossing an exploding, potentially incendiary
device into a home that may be full of innocent people in the
middle of the night is A-OK as long as you are reasonably sure all
those people are 18 or older. And beyond that question, of course,
is the issue of whether violence is ever a morally acceptable
response to peaceful, consensual transactions between
adults.

Terrell continues to blame those transactions for the
horrible injuries police inflicted on a sleeping baby. “The
information we had from our confidential informant was there was no
children in the home,” he
told WXIA, the NBC station in Atlanta. “We always ask;
that determines how we enter the house and the things we do…. Did
we go by our training, did we go by the intelligence? Given the
same set of circumstances, with the same information dealing with a
subject who has known gun charges on him, who is selling meth, they
would go through the same procedures…Nothing would change….Had
no way of knowing the child was in the house. The little baby [who]
was in there didn’t deserve this. These drug dealers don’t
care.”

Terrell, by contrast, cares so much about the psychoactive
substances his neighbors consume that he is willing to endanger the
lives of innocent bystanders in his vain attempt to stop people
from getting high. If Terrell cared a little less, Bounkham would
be home with his parents instead of clinging to life in a
hospital.

Some
people wonder why libertarians are skeptical of antitrust. For a
hint, you have to look no further than the recent battle between
book-selling giant Amazon and the publisher Hachette.

Amazon and Hachette are engaged in a pricing dispute. Although
the details are unclear, it’s been reported that Amazon wants
better terms on ebooks as it renegotiates its contract with
Hachette. Hachette is holding the line, and Amazon has exercised
its “nuclear option” by pulling Hachette’s print books off
its virtual shelves. As a result, the company faces accusation that
it acts like a monopoly and calls for antitrust action.

So it is interesting to note, points out Jerry Brito, that the
dispute is happening now because Hachette agreed to renegotiate its
contract with Amazon as part of an antitrust settlement with the
Department of Justice. That’s right. Hachette and four other big
publishers were sued along with Apple in 2012 for antitrust
violations.

View this article.

Former Reason editor Virginia Postrel has a

great piece at Bloomberg View about how the Authors
Guild (est. 1912) is attacking an upstart group, the Authors
Alliance, and teh Internet BECAUSE COPYRIGHT!

It’s only a little more complicated than that. The Authors Guild
sued Google for daring to digitize books, thus allowing potential
readers to discover them online (the Guild lost its case).

On the Guild’s official blog, a member attacked the Author’s
Alliance as “an astroturf organization” tailored to “academics and
hobbyists” rather than real writers. The alliance bills itself as
support for “authors who write to be read.” 

Postrel neatly dissects what’s wrong with the Authors Guild’s
attempt to hold back the march of time, technology, and a rival
advocacy group.

The Internet has unquestionably made it more difficult to make a
living as a writer. But the problem isn’t copyright infringement.
It’s competition. We’ve gone from a world in which reading material
was relatively scarce and expensive to one in which it’s
overabundant and nearly free. And it’s much, much harder to get
readers to hear about your book. Reviews and excerpts get lost in
the vast sea of online content. Online retailers haven’t found good
substitutes for bookstore browsing. Scanning books to make them
searchable doesn’t hurt sales. It gives those works a prayer of
being found.

It also saves books from
“digital oblivion.” For increasing numbers of readers, a book that
doesn’t show up in a Google search or can’t be linked to in some
way online might as well not exist. The scanning the Authors Guild
wants to block rescues old titles from the memory hole. Going
forward, it means that today’s new titles will have a chance of
enduring, at least as searchable files, for as long as the websites
are preserved by the Internet Archive. Do you want your latest book
to be as easy to discover in 10 years as one of today’s cat videos
or Buzzfeed listicles? Or do you want it to go down the memory hole
unless you post it online for free?

Postrel notes that there is a “perverse logic” to the Guild’s
stance. Its members who are writing new books benefit if older ones
are not as easy to find (even as that makes it harder to write
well-researched new books). But this is bad thinking, especially
from folks who typically talk about how important it is to be
grounded in history and tradition. Fact is, the publishing
establishment and certainly those who are well compensated under
the status quo publishing world hate change and the general
leveling that’s been made possible via the Internet. If you’re,
say, Erica Jong (a
critic of the Authors Alliance and anything that threatens a
system that has rewarded her handsomely), it’s easy to understand
why you fear change. But for the rest of us trying to make a living
putting pixel to page? Not so much.

Whole Postrel piece here.

Pro-Russian militants staged a predawn
400-man attack near Ukraine’s eastern border today, prompting the
U.S. government to reaffirm its support for the unstable
nation.

The Associated Press (AP) reports
on the battle, which took place at a border guard base and
persisted into the afternoon:

Serhiy Astakhov, the spokesman for the border guard service,
[said] that a preliminary assessment indicated that five rebels
were killed and eight wounded in the attack on the walled compound
on the western fringes of Luhansk, a major city not far from the
Russian border. He also said seven servicemen were wounded, three
seriously. …

An AP reporter saw at least one dead rebel soldier about a
kilometer (half-mile) away from the base. Fellow fighters
approached and broke into tears as they viewed the body. One
insurgent said the dead man was a leading rebel commander.

The militia was armed with rocket-propelled grenades. Whether or
not they were part of a larger, coordinated offensive is unknown,
but in another city, Sloviansk, rebels apparently laid landmines
around power plants and in yet another, Donetsk, they kidnapped a
local newspaper editor.

Assistant Secretary of Defense for International Security
Affairs Derek Chollet said at a press
conference today that the Luhansk attack is “a further example of
the destabilizing activities that we believe are supported by
Russia in the east.” He reiterated at a press conference this
morning that the U.S. has pledged $18 million toward “strengthening
our long-term defense cooperation, especially in helping Ukraine
build a highly effective armed force and strengthening its defense
institutions.” The State Department maintains that the funding,
which was first announced
in May, will only be spent on “non-lethal security assistance.”

According to the Kyiv Post, though, Chollet also
hinted that the U.S. may provide “more aggressive help” to Ukraine
after today’s attack.

On Wednesday, President Obama will meet with President-Elect
Petro Poroshenko, who has
requested direct military aid to rebuff the forces.

For its part, Russia offered “humanitarian aid” to
eastern Ukraine last week. The Ukrainian government rejected this
and maintains that Russia is engaged in “undisguised aggression”
against Ukraine. The situation increasingly looks like an all-out
war. Rebels recently shot down a military helicopter, and although
Russia officially denies it, some militants
claim themselves to be part of a Chechen “savage unit” on
official orders. One Russian official shrugged this off saying, “We
can’t control where our citizens go.”

Here
is a video of a fighter seemingly dragging himself to safety.
Below is
a video allegedly from the early hours of today’s attack:

Back in 2009 at the Copenhagen UN climate change conference
President Barack Obama promised to cut by 2020 U.S. planet-warming
carbon dioxide emissions by 17 percent below the level emitted in
2005. Today, the Environmental Protection Agency has announced the
president’s
Clean Power Plan that aims to cut carbon dioxide emissions by
2030 at existing electric power generation plants by 30 percent
overall. Each state will be given a specific goal and be
responsible for figuring out how to achieve its mandated reduction
goal using a mixture of policies that include switching from coal
to natural gas, building more wind and solar power, and/or pricing
emissions in carbon markets.

The EPA has crunched the numbers and assures the American public
that benefits of implementing this program will hugely outweigh its
costs. In its
regulatory impact analysis, the EPA calculates the global
climate benefits using the social cost of carbon derived from a
controversial Interagency Working Group report. That analysis found
that social cost of carbon in 2020 ranged over $13, $46, $68, and
$137 per metric ton of CO2 emissions (2011 dollars) depending on
the discount rate picked by the analysts. The discount rates used
were 5, 3, and 2.5 percent. The Working Group derived a high-end
figure of $137 per ton in 2020 by looking at the worst 5 percent of
the distribution, i.e., the less likely but possibly catastrophic
damages using a 3 percent discount rate. 

With regard to deriving a social cost of carbon, the EPA’s
regulatory impact analysis does caution that …

…any assessment will suffer from uncertainty, speculation, and
lack of information about (1) future emissions of greenhouse gases,
(2) the effects of past and future emissions on the climate system,
(3) the impact of changes in climate on the physical and biological
environment, and (4) the translation of these environmental impacts
into economic damages.

Other than that, everything is evidently OK.

Depending on the discount rate selected, the global climate
benefits (not the climate benefits to the U.S.) from implementing
this 30 percent reduction in power plant carbon dioxide emissions
in 2020 will amount to $4.9 billion, $18 billion, $26 billion, or
$52 billion. By 2030, the global benefits would rise to $9.5
billion, $31 billion, $44 billion, or $94 billion. These are just
the benefits from lowering future increases in global average
temperatures. The vast majority of the benefits have nothing
directly to do with cutting carbon dioxide emissions by 30
percent.

The real bang for the buck comes in the form of health
co-benefits arising from cuts in air pollutants like sulfur
dioxide, ozone, mercury, and particulates. In fact, more than 70
percent of the health co-benefits apparently result from reductions
in sulfur dioxide emissions.

The EPA calculates that the maximum cost for implementing the
new regulations amounts to $7.5 billion in 2020, while the maximum
net climate and health benefits range from $27 to $50 billion at a
3 percent discount rate or $26 to $46 billion at a 7 percent
dicount rate. On it’s face, that sounds like a pretty good deal.
But as I reported last August in my article, “The
Social Cost of Carbon: Garbage In, Garbage Out,” anyone can
pretty much conjure whatever number one wants when it comes to
cranking out the social cost of carbon through integrated
assessment models that combine econometric and climate
prognostications.

Another interesting feature is that the Obama administration’s
social cost of carbon estimate is for global benefits,
although the rules from the regulatory oversight agency, the Office
of Management and Budget specify that benefits and damages of
proposed regulations should be reported in terms of domestic
impacts, with global impacts being optional. The domestic social
cost of carbon would likely hover around $2 per metric ton which
suggests that the domestic climate benefits from the proposed EPA
regulations could actually amount in 2020 to as little as $700
million a worst case of $7.8 billion. Compare those benefits with
an estimated cost of $7.5 billion to implement them.

Finally, as the New York Times helpfully points out
today, the goal of the new EPA mandates is not to save the climate
but to “reclaim
leadership on climate change.”

More analysis of the impacts of the new Clean Power Plan to
come.