ROTC: Harvard vs MIT

In 1969 when ROTC was banned on the Harvard Campus I was a junior faculty member at MIT and located in what was Building 20, the old "Rad Lab" building, a wooden structure which housed the MIT ROTC groups. Many a night as I worked, with threats of bombing the building by the SDS, I just paid little if any attention. I was from New York and these SDS ers were pikers. There were a few close calls.

In writing my book on the USS Albert W Grant I had the opportunity to access the records of Hunt Hamill, a classmate and team mate of JFK, class 1940 at Harvard, and the XO on the ship. Hamill was a member of the 1940 Harvard NROTC class and they are shown below.
























This a fine group of Harvard men, but as you read the NY Times today you see there is less than a handful today. Hamill and his classmates were the heroes of WW II, patriots, who worked together and dies together to defend democracy. The current men are in many ways as much if not more than these men since they have to travel miles to get their training.

The Times states:

"R.O.T.C. students at Harvard and Yale are not the only ones campus-hopping. Harvard is one of eight colleges served by M.I.T., the Army R.O.T.C. host school. Five of these satellite colleges — Wellesley, Tufts, Gordon, Endicott and Salem State — have arranged for transportation for their cadets to get to M.I.T. Several colleges in the consortium have the R.O.T.C. staff travel to their campuses to conduct military classes and physical training, making it easier on their students.

Harvard, with its campus ban, does neither.

One of the featured speakers at the 2009 Harvard commissioning ceremony, Darnell Whitt II, a retired naval captain, noted that the year he graduated from Harvard — 1959 — 121 seniors were commissioned as officers. He told the R.O.T.C. students that he was sorry their numbers were so few and that he hoped that by the time they returned for their 50th reunion, “the current issues about military matters at Harvard will have been resolved and there will be a closer connection between the great university and those in uniform.”"

The article continues:

"President Faust of Harvard, a historian, says that as much as she admires the military ­— and during her June commissioning speech, she went out of her way to mention an interest she and General Petraeus shared in Ulysses S. Grant — she cannot have a student group on campus that is closed to one part of the student body. The student handbook says that the federal law is “inconsistent with Harvard’s values as stated in its policy on discrimination.”"

This is a bit of a stretch since the ban was in 1969 when the issues of homosexuals in the military was not even an issue. The military truly requires men and women from the non-Academy world to come to their ranks and make a truly integrated service. President Faust should come to see the merit of military training and participation since it is by the inclusion of men and women from Harvard that the military will actually evolve with society. The impact on the Navy due to the NROTC men in WW II was tremendous. Admiral Nimitz himself was the NROTC head at Berkeley before going to Washington!

I am reminded of the story by Hamill regarding a call from Gov Saltonstall when he was Cadet Commander of the NROTC at Harvard when there was a revolt against the Communists on Campus. Some students had requested that the NROTC take action and subdue the Communists by force. Saltonstoll told Hamill that if any harm befell the Communists that he would take no action. Hamill prudently let the matter cool down. The details are in the clipping below. It is worth a read. The men of the ROTC were true patriots. Perhaps President Faust could also give it a read as well.

Cash for Clunkers and the White House

I have just been following the battle of words between Edmunds, the automotive industry tracking company and the White House Blog.

Edmunds made the following statement:

"Edmunds.com .... has determined that Cash for Clunkers cost taxpayers $24,000 per vehicle sold...Nearly 690,000 vehicles were sold during the Cash for Clunkers program, officially known as CARS, but Edmunds.com analysts calculated that only 125,000 of the sales were incremental. The rest of the sales would have happened anyway, regardless of the existence of the program.

Ironically, the average transaction price for a new vehicle in August 2009 was only $26,915 minus an average cash rebate of $1,667.."This analysis is valuable for two reasons," explained Edmunds.com CEO Jeremy Anwyl. "First, it can form the basis for a complete assessment of the program's impact and costs. Second—and more important—it can help us to understand the true state of auto sales and the economy. For example, October sales are up, but without Cash for Clunkers, sales would have been even better. This suggests that the industry's recovery is gaining momentum.""

Putting the numbers aside the issue is quite a simple one. There would have been some systemic buy rate with or without the program and that the program increased the buy rate and thus the true costs per new sale should be, per Edmunds, the total rebates spent divided by the incremental sales.

Well this is a typical marginal sales analysis. Anyone who has ever been in retail knows that you advertise to get new sales and that you look at the cost of the new sales based upon the advertising. You may use average costs but the marginal costs are the true costs. Simple Business 101. Anyone who has ever had a real job will catch that point. Thus to a great degree Edmunds had a point.

For example, consider a company which has sales of 100,000 units per month. and the units sell for $10 each, thus a sales of $1 million per month It pays its sales people a 4% commission and it wants to motivate more sales. Thus it agrees to pay 5% per month. The old plan had $40,000 in sales commissions and with the new plan the sales go to 120,000 units but now the sales commission is $60,000. In the first case the average cost of sales was $0.04 and now it is $0.06. Yet for the new 20,000 units sold it really cost $20,000, or $0.10, or 10% commission! That is the point Edmunds is making and that is exactly the point the White House Blog seems to miss as well as Ms. Romer's brain trust at CEA.

The White House Blog then decides to get into the fray. They post a Blog entry, Busy Covering Car Sales on Mars, Edmunds.com Gets It Wrong (Again) on Cash for Clunkers, by one Macon Phillips which states:

"On the same day that we found out that motor vehicle output added 1.7% to economic growth in the third quarter – the largest contribution to quarterly growth in over a decade – Edmunds.com has released a faulty analysis suggesting that the Cash for Clunkers program had no meaningful impact on our economy or on overall auto sales. This is the latest of several critical “analyses” of the Cash for Clunkers program from Edmunds.com, which appear designed to grab headlines and get coverage on cable TV. Like many of their previous attempts, this latest claim doesn’t withstand even basic scrutiny...

The Edmunds’ analysis rests on the assumption that the market for cars that didn’t qualify for Cash for Clunkers was completely unaffected by this program.

In other words, all the other cars were being sold on Mars, while the rest of the country was caught up in the excitement of the Cash for Clunkers program. This analysis ignores not only the price impacts that a program like Cash for Clunkers has on the rest of the vehicle market, but the reports from across the country that people were drawn into dealerships by the Cash for Clunkers program and ended up buying cars even though their old car was not eligible for the program...."

Well the highlighted comment is confusion on the part of the White House Blogger between average and marginal costs. Yes indeed if one looks on an average basis the cost was whatever you spent but marginally is was many time more. Why the Blogger uses the Mars reference is beyond me except it appears as a very childish thing to do on a White House site, yet it may be a generational thing. Since the Blogger appears to know little if anything of economics and business is can be forgiven as childhood enthusiasm.

Now the the CEA report the blogger refers to. This is another Romer Report, of whose credibility we have been questioning since her initial prognostication on the economy in January. The Report states:

"On the other hand, Macroeconomic Advisers argues that “almost all the sales under this program just moved forward transactions that would otherwise have taken place over the next several months.” They therefore expect only a very small effect on the path of GDP. This is clearly a worst-case scenario, and appears to require extreme assumptions about both usual clunker-replacement demand and the payback effect.

In contrast, IHS Global Insight has estimated the CARS program will add about 600,000 net sales to the market this year, more than in even our most optimistic scenario, which puts the figure at 560,000. If their forecast turns out to be correct, the impact on GDP and employment will be larger than we have projected.

A final point of comparison is a mid-August assessment by J.D. Power, a leading auto industry forecaster, that the net boost to auto sales for all of 2009 from the CARS program will have been 300,000. This compares with our baseline scenario of a 2009 boost of about 330,000."

Yes, the data is correct but again the point is marginal versus average costs. Was the program useful, I would have to say yes in that it did increase auto sales, yet was it costly, yes, as are all the Stimulus programs. Was the program necessary, perhaps. Time will tell. Yet the White House Blog should get a bit more professional and less childish in its analysis of its critics.

HR 3962, The IRS Seems to be There Again

When we reviewed HR 3200 we had a major concern regarding the IRS as the enforcer. In the current revision listed as HR 3962 the IRS seems to have grown in its influence. We will be reviewing this shortly. It is a massive undertaking but it will influence us for generations.

CBO On The Latest House Plan

The CBO has issued their report on the latest health care plan, HR 3962. The CBO states:

"According to CBO and JCT’s assessment, enacting H.R. 3962 would result in a net reduction in federal budget deficits of $104 billion over the 2010– 2019 period (see Table 1). In the subsequent decade, the collective effect of its provisions would probably be slight reductions in federal budget deficits. Those estimates are all subject to substantial uncertainty. The estimate includes a projected net cost of $894 billion over 10 years for the proposed expansions in insurance coverage. That net cost itself reflects a gross total of $1,055 billion in subsidies provided through the exchanges (and related spending), increased net outlays for Medicaid and the Children’s Health Insurance Program (CHIP), and tax credits for small employers; those costs are partly offset by $167 billion in collections of penalties paid by individuals and employers. On balance, other effects on revenues and outlays associated with the coverage provisions add $6 billion to their total cost."

The CBO presents a good summary of the PO part of the Plan which they summarize as:

"Policies purchased through the exchanges (or directly from insurers) would have to meet several requirements: In particular, insurers would have to accept all applicants, could not limit coverage for preexisting medical conditions, and could not vary premiums to reflect differences in enrollees’ health. The options available in the insurance exchange would include private health insurance plans as well as a public plan that would be administered by the Secretary of Health and Human Services (HHS). The public plan would negotiate payment rates with all providers and suppliers of health care goods and services; providers would not be required to participate in the public plan in order to participate in Medicare. The public plan would have to charge premiums that covered its costs, including the costs of paying back start-up funding that the government would provide."

The CBO report as usual is the best summary. It is worth a first read.

The Public Option: A Systems Analysis Approach

The Public Option, PO, has been proposed and there has been no analytical study of what may be the market dynamics as a result of its introduction. We have commenced a study of this effect. Specifically we have constructed a model of the market dynamics of a PO and what the participation could look like under varying conditions. We will be presenting the results in a White Paper shortly. However give the intensity of the discussions we felt that and an early discussion was warranted.

The analysis consists of the dynamics of patients and providers in a PO and in a private plan, PP. Specifically we look at the dynamics over time of a PO compared to a PP. We assumed that persons and providers were either in a PO or a PP. That they moved back and forth over time due to observable from the prior time interval. These driver from one to the other were either attractants or repellents.

For the person selecting a plan the attractant is the price difference between a PO and a PP. The greater the difference the more the person went to the PO. On the other hand the repellent was the quality as reflected in patients per provider. The person looked at the difference in patient per provider in a PO and a PP and the greater the difference the greater the repellent effect. Thus as more people went to a PO due to price the more patients per provider resulted which in turn became a repellent.

For the provider there are just repellents. First is the reimbursement, which is plan dependent only and not dependent upon patients. Second is the load of patients per provider.

We combined these into a dynamic model of the type:

N(k+1) = a N(k)+Attractant(k)-Repellent(k), where N is the number of persons say in a PO

and

P(k+1)= b P(k) + Attractant(k) - Repellent(k), where P is the number of providers.

Calculations for attractants, repellents are negative attractants, are shown below:



















These are of course subject to change but they demonstrate the viability of the approach. Now using these values we can determine the percent of the people who will participate in a PO plan and we show its dynamics below:



















Note that this shows an increase and then a decrease. This effect if first driven by cost, lower costs of the plan, and then driven by the lower quality where subscribers leave the plan.

We now depict the patient participation.



















The following is the provider participation. In all analyses we have found low provider participation. This is similar to what we see in Medicaid and what we are beginning to see in Medicare. There is a growing refusal by many, especially the most competent physicians, to participate. If one wants good care one must pay.



















The patient per provider ratio has the most impact in our analyses. The numbers are shown below for this example.



















The revenue per patient is also a factor but seems to be secondary. We depict that below:



















We believe that detailed studies of this type are essential. We also believe that systems type analysis are not what the economists do. They fall into two camps. The macro type who conjure up slopes of trends, which are meaningless and fail to account for the dynamic factors or the econometric types who used old data to project new trends, which have the seeds of their own destruction already sown.

The major concern we have is the providers ability to opt out of a PO. I have not yet studied the massive 1990 page Bill but that is a concern.

GDP Changes, Some Detail

We have analyzed the recent GDP data released yesterday and there is some insight in the details.

First we present the GDP changes by quarter over the duration of the recession in the figure below. The results reiterate what we presented yesterday.



















Second we show the changes in the domestic investment element of residential and non residential. The positive upswing in residential is heartening. It has been suggested that the reason for this is the home tax benefit but it is equally of more likely to be the low interest plus the bottoming of the market. Pressure due to high unemployment and continued uncertainty will keep this low however.


















Third we show the Government elements, federal and state. There is a clear jump in federal and a continued decrease in state. The reason is uncertain because it was assumed the Stimulus would impact the states whereas it has not.


















Fourth is personal consumption which is showing some life but still remains low.


















Fifth is the trade element showing an increase in exports and decrease in imports. Perhaps this is a combined effect of the weakness in the dollar, the growth in other economies as well as the lagging demand in the US.


















The main driver is still Federal Government spending yet the residential investment portion is a positive sign as is the export element.

M2, GDP, Inflation Update

We here review the impact of the GDP increase on inflation projections.

First the following shows the M2 growth up to the latest data, including Q3 2009. M2 has remained flat over the duration of the Recession and in the last Quarter it has even been reduced again.



















The following shows the M2 volatility and it changes. It continues to show a dampening in its volatility which suggest some stability. We are still concerned that the banks maintain their excess reserves and once that is released it will increase M2.



















The last chart shows the elements which add to the inflation calculation from the M2 data, velocity and GDP change. The resultant inflation estimate is still low for Q3. We have not yet compared that to the CPI changes but the core inflation resulting from the monetary calculation remains low.

Just in Time for Halloween

Halloween is upon us and the leaders from the House have thrown out a latest 1990 page Health Care Bill! If you had problems with HR 3200 you will love this one.

They state the following:

1. REDUCES THE DEFICIT MORE—According to the CBO, the revised bill reduces the deficit by $30 billion over the first 10 years.
2. ENDS HEALTH INSURANCE COMPANIES’ BLANKET EXEMPTION FROM ANTI-TRUST LAWS
3. EXTENDS COVERAGE FOR YOUNG PEOPLE UP TO 27TH BIRTHDAY THROUGH PARENTS’ INSURANCE
4. CREATES A NEW, VOLUNTARY, PUBLIC LONG-TERM CARE INSURANCE PROGRAM
5. EXEMPTS SMALL BUSINESSES WITH PAYROLLS BELOW $500,000 FROM EMPLOYER MANDATE
6. LIMITS THE “HEALTH CARE SURCHARGE” TO MILLIONAIRES
7. ADDRESSING GEOGRAPHIC VARIATIONS IN MEDICARE PAYMENTS/MOVING TO MEDICARE PAYMENTS REWARDING QUALITY AND COST-EFFECTIVENESS
8. BEGINS CLOSING THE MEDICARE PART D DONUT HOLE IMMEDIATELY
9. IMMEDIATE HELP FOR THE UNINSURED (INTERIM HIGH-RISK POOL)
10. HHS NEGOTIATION OF DRUG PRICES

This means public option and an in your face attack. Frankly the numbers are unbelievable. There is not CBO report.

GDP Growth

The Bureau of Economic Analysis has announce that the GDP has increased at an annualized rate of 3.5% from Q2 2009 to Q3 2009. This compares to a comparable -0.7% change for Q1 to Q2 2009.

Specifically BEA notes:

"Motor vehicle output added 1.66 percentage points to the third-quarter change in real GDP after adding 0.19 percentage point to the second-quarter change. Final sales of computers subtracted 0.11 percentage point from the third-quarter change in real GDP after subtracting 0.04 percentage point from the second-quarter change.

Real personal consumption expenditures increased 3.4 percent in the third quarter, in contrast to a decrease of 0.9 percent in the second.

Durable goods increased 22.3 percent, in contrast to a decrease of 5.6 percent. The third-quarter increase largely reflected motor vehicle purchases under the Consumer Assistance to Recycle and Save Act of 2009 (popularly called, “Cash for Clunkers” Program).

Nondurable goods increased 2.0 percent in the third quarter, in contrast to a decrease of 1.9 percent in the second. Services increased 1.2 percent, compared with an increase of 0.2 percent. Real nonresidential fixed investment decreased 2.5 percent in the third quarter, compared with a decrease of 9.6 percent in the second.

Nonresidential structures decreased 9.0 percent, compared with a decrease of 17.3 percent. Equipment and software increased 1.1 percent, in contrast to a decrease of 4.9 percent.

Real residential fixed investment increased 23.4 percent, in contrast to a decrease of 23.3 percent.

Real exports of goods and services increased 14.7 percent in the third quarter, in contrast to a decrease of 4.1 percent in the second.

Real imports of goods and services increased 16.4 percent, in contrast to a decrease of 14.7 percent."

The remaining question is why do we need the spend more on Stimulus and add to the already exploding deficit.

Health Insurance and Medicare

The costs of Health Insurance is rising 15% for next year( See several articles.). I have studied several plans and they all seem to come in at that number. A somewhat out of the way but typical example come from Alaska which states:

"Individuals seeking personal health insurance will see their rates raise an average of 17.5 percent this year, while businesses with two to 99 employees will see rates increase 21.7 percent, says Katie Campbell, actuary for the Alaska Division of Insurance.

Those increases compare with a nearly 32 percent average rate increase in 2008 for individuals and 28.8 percent for employers of up to 99 people, Campbell said Oct. 16"

The question is, why?

1. There is no inflation, in fact the opposite is true so it cannot relate to that..

2. Physicians are not being paid more, in fact as the population ages those treating Medicare patients are paid less.

3. However as we stated earlier when reviewing the employment stats, the only increase in employment is in health care, especially hospitals, home care, hospice care, nursing home care. It appears that these institutions are bulking up in anticipation of change and as usual the individuals are paying.

4. Health care costs were at $2.1T in 2006 and are anticipated to be at $2.5 in 2009. This is an annualized rate of 6%, well ahead of inflation, yet well below the 15% number for 2010! Medicare has increased almost 100% for Part B.

5. Notwithstanding these numbers there are insurance increases that far exceed the overall expenditures on health care. One suspects that the insurers are front loading their fees in anticipation.

With Congress discussing public options and the like, what will happen is that the insurers are becoming their own worst enemies and yet Congress is not paying attention.

Now to Medicare. There are several hopefully negative unintended consequences if Congress pushes down Medicare rates.

1. Fewer physicians will accept Medicare patients. We see this happening now especially in major metropolitan areas.

2. Medicare reimbursements are being reduced so that if a physician participates in Medicare the reimbursement is getting to an unacceptable level, lower than costs in many areas. This applies to physicians and not hospitals which seem to be doing fine.

3. If one has a supplementary policy it pays up to say 80% of what the costs are after assuming Medicare pays. Let us examine this scenario. Let us assume a patient needs a hip replacement. The costs of the hospital is say $45,000 and the physician is $25,000. This is a total of $70,000. Now let us assume that Medicare had paid $35,000 to the hospital and $15,000 to the physician. If either participated then they would have to accept that payment. Yet they may charge you more which you pay, the 20% above and in fact the provider could charge more. Thus your supplementary insurance would assist in paying the excess.

4. In anticipation of the reduction in Medicare for 2010, the insurance companies are driving up the supplementary payments.

5. If Medicare becomes so low a reimbursement plan, and if you select a provider who will not accept Medicare, the question is what becomes of the supplementary plan, is it now the primary, leaving you with what Medicare would have paid as well as any excess not covered by the plan? Does this supplementary become a de facto primary for Medicare if you cannot find a provider accepting Medicare. If so, then expect explosive supplementary rates as we are now seeing.

Romer and Health Care

The head of the CEA gave a speech today regarding health care. One must remember that this is the same individual who so correctly predicted the economic impact of the Stimulus, thus we suspect that her prognostications are to be less than accurate.

However it is worth seeing what she says:

"The Senate Finance Committee bill includes a tax on high-priced insurance plans, suggested by Senator Kerry. A policy along these lines, designed carefully, will encourage both employers and employees to be more watchful health care consumers. It will discourage insurance companies from offering high-priced plans that would otherwise eat up larger and larger shares of workers’ wages. A policy such as this is probably the number one item that health economists across the ideological spectrum believe is likely to stem the explosion of health care costs."

When one analyzes the effect of the high cost plans they appear to impact Goldman Sachs and Union employees. For the most part Americans are on the budget plans. A high end plan is paid for by someone, the employer or even the individual. How taxiing them reduces costs has never been explained. They cover a small percentage of people and they do not in any way drive up demand or increase incidence. There just is no line around the block waiting for colonoscopies.

She continues:

"Several of the current versions of health insurance reform include sensible payment reforms for doctors, hospitals, and other providers participating in Medicare. For example, bundling payments for an episode of care associated with an acute event, such as a heart attack or a hip fracture, is a common-sense change. It gives doctors and hospitals the right incentives to provide patients with efficient and high-quality care, and the information they need to manage the transition back home successfully. These incentives improve patient care and outcomes,
while lowering costs in the long run."

As we have stated before and as we have detailed in our Book on Health Care the use of bundling will just memorialize the inefficient structure of hospitalized care and drive out physician based innovation. Bundled Care is a hospital controlled service and it forces collectives of low cost physicians which generally provide lowered levels of care. It maximizes the hospital's return.

She continues:

"Precisely because such reforms are so important for both cost containment and patient health, it is crucial to create an institutional structure that encourages and routinizes such innovations. That is why the President has endorsed the establishment of an Independent Medicare Advisory Council (IMAC). The IMAC would provide Congress each year with cost-saving recommendations that improve care and maintain benefits. By removing some of the political pressure around such reforms, the IMAC would make it easier for improvements to be made year after year..."

The IMAC in principle is not new for it is but a regeneration of what Medicare has been doing all along. By the time a person has gotten on Medicare two facts are clear. First they have contributed more than they will ever get back in benefits, the money having been spent by Congress. Second, the ability to modify any potential disease states is de minimus.

She continues:

"Recent CEA research suggests that the total fiscal impact of health care reform may be even larger than our baseline estimates suggest. As I have described, current draft legislation greatly expands access to health insurance coverage. This change is crucially important for state and local governments that currently pay for much of the care provided to the uninsured. Using a wide range of sources, including state reports, county records, and numerous phone surveys of local officials, the CEA has provided lower-bound estimates of the amount that sixteen states currently spend on care for those without insurance. We find that these sixteen states are spending at least $3.6 billion per year (in 2007 dollars) on this uncompensated care. We estimated that they are spending another $600 million on higher insurance premiums for state and local government employees because of the hidden tax uncompensated care adds to all private insurance premiums. All told, the states in our sample are spending at least $4.2 billion on care for the uninsured each year."

First one must see that these are CEA estimates which we have seen are less than worthless. Second her analysis grossly neglects the issue of reducing demand, such as that of Type 2 Diabetes due to obesity. Ms. Romer, we wonder why?

Fairpoint Bankruptcy

Fairpoint today announced that it has filed for bankruptcy, say Reuters. It states:

"Rural telecom services provider FairPoint Communications Inc (FRP.N) filed for Chapter 11 protection in a Manhattan bankruptcy court on Monday, under a pre-arranged plan that would cut its debt by $1.7 billion."

We have been saying this for well over a year. The interesting question is what impact this will have on Verizon and what shareholder suits will follow. In our opinion, as we have stated many times before, Fairpoint never had a chance and it should have known this from the outset. The management has just destroyed shareholder value and places the telephone users in the New England states at a disadvantage.

Reuters summarizes the claim:

"In its Chapter 11 filing, the company listed total assets of about $3.24 billion and debt of about $3.23 billion... its annual interest expenses would be reduced from more than $200 million to about $65 million...1.7 million access line equivalents... the seventh largest local telephone company in the United States."

In out 2002 paper on the Collapse of Telecom we predicted many such collapses. The question will be just where this leaves Verizon.

Education, Rawls, and Teaching

The Wall Street Journal had an article on the failure of Science and Math education in the US. As one involved at the latter end of the process I see that I have had not a single US born student in my last five years. They have been mostly Asian. I also once spent a year teaching at Columbia University School of Business and I found that most of the students had at best a 10th grade understanding of math and were generally ignorant of science, other that what the NY Times told them.

Thus I was not surprised when I read the Rawlsian head of U Penn state:

"AMY GUTMANN: The Sputnik era didn't come because a lot of idealists said we had to be better. It came because there were idealists as there are today who said we're in trouble as a country, we have to compete against the Russians. We have to compete today against the Chinese and Indians who are graduating tens of thousands more very talented science, math and engineering graduates from their colleges. They're not doing better than we are at the college and university level, but they're doing massively better than we are in the numbers. They have hugely greater populations."

She uses the term "idealists" to describe the decision makers. As one who participated in the process at the time there was abject terror about the Russians and the delivery of weapons from space. She is wrong. It was not the idealists but rather the realists. It was in fact the idealists who almost lost our civilization to Stalin.

A good factual history is the recent book by Sheehan, A Fiery Peace in a Cold War, which recounts those times fairly accurately. I content that they may not be competing well against American at U Penn, in Arts and the like, but they are beating the heck out of Americans in graduate studies at MIT and Stanford! Here is a Rawlsian educator who in my opinion is defective in basic facts. It is NOT the populations, of China and India it is their competitive spirit. They are more individualistic competitors than most American students. They have not spent time reading Rawls and Marx, in the Chinese case despite their underlying Government, they are striving for success, they are competing. They do not play games where everyone wins, there are many who do not make it and they have to "deal with it". Frankly it is the Rawlsian ethic of having the least do as well as the most, the idea of communal ownership of even one's intellect, that gives rise to what we see in the US today.

In contrast to the every Rawlsian Gutmann is Joel Klein who states:

"JOEL KLEIN: The most important thing is to bring to K-12 education college graduates who excel in math and science. Those countries that are doing best are recruiting their K-12 teachers from the top third of their college graduates. America is recruiting our teachers generally from the bottom third, and when you go into our high-needs communities, we're clearly underserving them."

Yes, teachers are from the bottom third. To teach Math and Science one needs the nest educated. Thus if one has a PhD say from MIT in Math or Science, and if one has taught for say 30 years, one is hardly qualified to teach Geometry in a public school. Why, no certificate, no training in overhead projectors, no experience in the training of the psychology of dealing with inequality amongst class members, not training in developing a Rawlsian ethic, and not a member of the teacher's union.

Now back to Gutmann. She states:

"MS. GUTMANN: The single biggest lever for economic innovation in our society is education, and it's not a direct lever of the President.

So what he can do is only really fund excellence initiatives, and they have to be distributed to the states. And I think the key here is making K-12 education more competitive on the ground. Let me give you an example. When the stimulus went through, $10.4 billion was put in for [National Institutes of Health] funding. That money in biomedical research is going to generate the innovations of tomorrow. There has to be at the K-12 level an understanding of how the federal government can incentivize competition."

The single biggest lever for innovation is NOT education, that is necessary but not sufficient, it is an entrepreneurial environment, the willingness to take risks, to seek regards, to better the competition, to outright win. That is antithetical to a Rawlsian like Gutmann! Thus Klein is correct in his assessment whereas Gutmann is well off base. Yet it is the same ad hoc propiter hoc arguments of Gutmann that are used to justify the current Administrations efforts. In reality it is competition and reward that motivates and stimulates not the idealists of Gutmann. I can remember many of the idealists in the 50s and early 60s, and for the most part, I believe without exception, the developments came from the entrepreneurs, not the idealists!

The Romer Data: A Comparison

I have been spending time looking at the Romer data regarding the economy especially unemployment projections. The graph below compare her latest projections as compared to what she stated in January with and without the Stimulus.



















The top line is her latest projections. Her comments should be on concern. If the Stimulus has had its maximum effect and if she continues to project unemployment well above 9% then why spend more Stimulus money, for it is clear that the data she and her husband had analyzed in detail a year before she took her position was correct, Government funding has little effect.

Another issue is given the wide variation in her projections, why should anyone believe anything she says? If a CFO of GM made these projections he or she would be fired. Why not Romer?

The question is what game is being played here. Does she have any belief in any of the numbers she presents or are they all fabrications of the White House. Is this just another grab for spending more money?

Furthermore in January she projected out thru 2014, now she is doing so only to 2014. Perhaps the Academic is being cautious.

And Some Want Government Run Health Care!

The H1N1 vaccine delay is another Government mess, so says the NY Times, albeit soto voce. It is not as if anyone was caught off guard. The States managed to assemble all of their efforts and waited for the Government. Well as I learned as a young man, prior planning prevents poor performance. Lives may be at risk, yet the folks who want to control all of your lives have managed to mess up the egg yolks!

One wonders if this message carries over to what Congress is about. Can the collection of folks up there on the Hill every get anything right. Also the Secretary of HHS seems clueless as well. If this were a real business they would be replaced.

The FCC, Internet Neutrality and Jurisdiction, if any.

The question on the table is by what authority does the FCC act? Yesterday the FCC issued its first blast on Net Neutrality. They state (as usual the references are key):

"B. Our Authority to Prescribe Rules Implementing Federal Internet Policy

83. Consistent with the Comcast Network Management Practices Order, we may exercise jurisdiction under the Act to regulate the network practices of facilities-based broadband Internet access service providers. We have ancillary jurisdiction over matters not directly addressed in the Act when the subject matter falls within the agency’s general statutory grant of jurisdiction and the regulation is “reasonably ancillary to the effective performance of the Commission’s various responsibilities.”195 That test is met with respect to broadband Internet access service.196

84. As explained in the Comcast Network Management Practices Order, we believe that exercising ancillary authority over facilities-based Internet access will “promote the objectives for which the Commission has been [specifically] assigned jurisdiction” and “further the achievement of . . . [legitimate] regulatory goals.”197 The proposed rules we enunciate here will, we believe, advance the federal Internet policy set forth by Congress in section 230(b) as well as the broadband goals that section 706(a) of the Telecommunications Act of 1996 charges the Commission with achieving.198 Section 201(b), moreover, gives the Commission specific authority “to prescribe such rules and regulations as may be necessary in the public interest to carry out the provisions of th[e] Act.”199

85. Voice and video services are increasingly delivered over the Internet, in actual or
potential competition with voice and video offerings of companies that provide broadband Internet access. This growing interrelationship with voice and video services that the Commission has traditionally regulated pursuant to express statutory obligations and its general public interest mandate further supports the Commission’s consideration of regulatory requirements for the provision of broadband Internet access service, and its ancillary jurisdiction to establish appropriate rules.

86. With respect to Internet access via spectrum-based facilities, we have additional authority
pursuant to Title III of the Communications Act.200 We have recognized previously that the spectrum allocation and licensing provisions of Title III and the Commission’s rules continue to apply to wireless broadband Internet access services because these services use radio spectrum.201 We have relied upon Title III authority in the past to regulate services provided by wireless carriers.202

87. We invite comment on our view that we have jurisdiction over broadband Internet access
service sufficient to adopt and enforce the proposed rules, or other rules that commenters propose."

where:

"195 United States v. Southwestern Cable Co., 392 U.S. 157, 172–73 (1968); accord United States v. Midwest Video Corp., 406 U.S. 649, 662 (1972).
196 Comcast Network Management Practices Order, 23 FCC Rcd at 13033–44, paras. 12–28; see also Brief for the FCC and the United States in Comcast v. FCC, No. 08-1291, at 25–50 (filed Sept. 21, 2009), available at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-293573A1.pdf.
197 Midwest Video I, 406 U.S. at 667.
198 See 47 U.S.C. §§ 230(b), 1302(a).
199 47 U.S.C. § 201(b); AT&T Corp. v. Iowa Utilities Bd., 525 U.S. 366, 378 (“We think that the grant in § 201(b) means what it says: The FCC has rulemaking authority to carry out the ‘provisions of this Act.’”); see also Alliance for Community Media v. FCC, 529 F.3d 763, 772–74 (6th Cir. 2008) (holding that section 201(b) gives FCC authority to issue rules implementing all portions of the Communications Act), cert. denied, 129 S. Ct. 2821 (2009).
200 Title III of the Communications Act (47 U.S.C. §§ 301–399B) contains provisions relating to use of the radio spectrum, including the Commission's broad authority over spectrum allocation (see, e.g., 47 U.S.C. § 303) and licensing (see, e.g., 47 U.S.C. §§ 301, 307, 308), including use of auctions (47 U.S.C. § 309(i)).
201 Wireless Broadband Classification Order, 22 FCC Rcd at 5914–15.
202 See, e.g., Interconnection and Resale Obligations Pertaining to Commercial Mobile Radio Services, CC Docket No. 94-54, Memorandum Opinion and Order on Reconsideration, 14 FCC Rcd 16340, 16352–53, para. 27 (1999)."

We believe that this section of the report will have the greatest impact because the FCC most likely has little if any authority and the record speaks for itself. This will result in endless and costly litigation the costs of which will go to the costs of broadband.

The basic statement of the FCC is as follows:

"92. Specifically, we propose that all providers of broadband Internet access service must
comply with the following four rules:

1. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from sending or receiving the lawful content of the user’s choice over the Internet.

2. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from running the lawful applications or using the lawful services of the user’s choice.

3. Subject to reasonable network management, a provider of broadband Internet access service may not prevent any of its users from connecting to and using on its network the user’s choice of lawful devices that do not harm the network.

4. Subject to reasonable network management, a provider of broadband Internet access service may not deprive any of its users of the user’s entitlement to competition among network providers, application providers, service providers, and content providers."

The new element of "subject to reasonable network management" is the operative phrase. This may actually send Net Neutrality down the drain if this term is interpreted too loosely.

Now the FCC defines this key term as:

"135. Here we discuss the proposed definition of reasonable network management:

Reasonable network management consists of: (a) reasonable practices employed by a provider of broadband Internet access service to (i) reduce or mitigate the effects of congestion on its network or to address quality-of-service concerns; (ii) address traffic that is unwanted by users or harmful; (iii) prevent the transfer of unlawful content; or (iv) prevent the unlawful transfer of content; and (b) other reasonable network management practices."

The last three elements are most likely just fine. No one wants junk, depending what junk is. The White House may deem anything from FOX as junk, but alas let the children throw sand in the sand box. The first is key:

(i) reduce or mitigate the effects of congestion on its network or to address quality-of-service concerns

This is the major concern. Who determines what is congestion, or what is a quality of service. These are not objective criteria. In fact we believe, as one who deployed one of the first VOIP and broadband nets globally, that this is utter nonsense. I wrote about QoS in 1998 and presented it in Italy and the bottom line was that I could not generalize it. Things have not gotten better. Thus the FCC by allowing this operative phrase has distorted the whole concept of net neutrality. We wrote a detailed paper on this a few years ago and I believe the position still stands:

1. The FCC has no statutory authority.

2. Congress must legislate to give it the authority

3. "Common Carriage" principles should apply but not Common Carriage regulation

The problem is the number of lawyers involved and the paucity of people who have really done anything!

Romer and Reality

Perhaps it would be a good thing to keep CEA head Romer in DC because that way she would not be capable of educating any more economists. In fact it may be good to get all economists to the White House and close down the departments and just let the trade wither away.

CEA head Romer testified before Congress yesterday and she stated:

"There is no question that the past year has been one of enormous challenges for the American economy. The recession that began in December 2007 has been the worst we have faced since the Great Depression. The suffering it has brought to American workers and their families has been terrible. The toll that it has taken on American businesses has been great across the spectrum—affecting firms both large and small; those in services as well as manufacturing; and firms in every state and community."

Her facts are just plain wrong. Unemployment and GDP changes are still below prior recessions and this is nowhere near the Depression. I remember the Nixon collapse when at MIT the Aero Department was down to 5 students and there were no recruiters at the student placement center, none, zero. The NY Times ads for jobs was zero, that was when everything was in the paper, no Internet, the job section had been eliminated! Then there was Carter in 1980 and I bought my NJ house with an 18.5% mortgage! The credit card rates were lower! Romer is just not connected with what has happened in the economic world! Try the Telecom bust, try the collapse of Thailand and Russia in 1998, I was there with my companies. You just adjust and pray that the economists just stay away!

She in a self serving was states:

"A key causal factor in both downturns was a decline in household wealth that lowered consumer spending. In 1929, however, the crash of the stock market in October mainly reversed a large run-up in stock prices that had taken place between June and August, and house prices declined only slightly. As a result, household wealth fell by just 3 percent between December 1928 and December 1929. In 2008, in contrast, stock prices fell 24 percent in September and October alone, and house prices fell 9 percent over the year. All told, household wealth fell 17 percent between December 2007 and December 2008, more than five times the decline in 1929."

The reason now is home values which had exploded to unheard of levels and are now back to where they were in 200%. Frankly where they should have been. The second factor is that many people now have 401Ks where in 1929 few people had any retirement. She is comparing apples to oranges.

She presents her new projections in the following chart.



















We have combined and reformatted her data. The GDP change is based upon little if any data and her projections on unemployment although dire are likewise baseless.

As to inflation she states:

"Some have expressed concern that the unprecedented monetary actions taken by the Federal Reserve and the similarly unprecedented fiscal actions taken by Congress and the Administration have created conditions likely to result in inflation.

Such concerns are unwarranted in the near and medium term. Historically for the United States, the main determinant of movements in inflation is the relationship between output and the economy’s productive capacity, with additional influences from oil price movements and other supply disturbances. When output and employment are high relative to the economy’s comfortable capacity, inflation rises, as it did in the late 1960s and late 1970s. When output and employment are low relative to capacity, inflation falls, as it usually does during and after recessions.

The behavior of inflation so far over the recession and forecasts of its likely behavior going forward fit with this view. Figure 6 shows inflation measured using both the consumer price index, which is highly influenced by the behavior of food and energy prices, and the GDP price index, which is less influenced by these volatile components. The figure shows that both measures of inflation have fallen over the course of the recession. Economic theory and evidence suggests that there is a relationship between monetary expansion or budget deficits and inflation, but that it operates via the demand for goods: rapid money growth and large budget deficits lead to inflation when they fuel a growth in demand beyond the economy’s normal capacity."

She continues:

"Measures of expected inflation, whether from professional forecasters (such as the one shown in the chart), surveys of consumers, or inferences based on interest rates on inflation-protected securities, all show that expectations of inflation remain subdued. Indeed, it appears that the major reason that actual and expected inflation have not fallen further is that the Federal Reserve’s record of inflation control over the past quarter century has kept inflation expectations well anchored. Even stronger evidence that a large expansion of central bank reserves and budget deficits in a weak economy do not lead to inflation comes from Japan."

Yet she fails to take into account the fact that we now have a 92% Government Debt to GDP and if the current Administration continues it will be 130-140% at then end of 2012! That will be unsustainable and it will most likely be that factor driving inflation. Add to that the fact that we rely so strongly upon China which holds almost 25% of our public debt then we have truly real problems if they allow their currency to float. The dollar will collapse and as they say, you have seen nothing yet. Romer is working with a Samuelson 1970 economic model, the world is linked and it will be that linking that will driven everything down unless spending us dramatically curtailed.

Google: Some Interesting Thoughts

I had the opportunity to review the ATLAS Internet Observatory report recently and one table struck me as quite compelling. The Table was a listing of the percent of anonymous ASN data ranked from highest to lowest.

In 2007 the top 1o list was:

1. Level 3 5.77%
2. Global Crossing 4.55%
3. ATT 3.35%
4. Sprint 3.20%
5. NTT 2.60%
6. Cogent 2.77%
7. Verizon 2.24%
8. TeliaSonera 1.82%
9. Savvis 1.35%
10. AboveNet 1.23%

To a great degree these are the classic Tier 1 Internet providers, the Club.

Now for 2009 the listings are:

1. Level 3 9.41%
2. Global Crossing 5.7%
3. Google 5.2%
4
5
6. Comcast 3.12%
7
8
9
10

Now the unlisted entries refused to have their names published. Interesting. But more interesting is that Google came from nowhere to No 3! And Comcast is No 6. Content is exploding.

Yet more importantly Google, as is Comcast, are NOT Tier 1 club members yet have some but not all the advantages of membership. If Google were to buy Level 3 then they would have almost 15% of the 2009 numbers and we estimate that by 2012 they would have well over 25%.

Thus where did Verizon and ATT go and what should they do. Remember that once Verizon owned Genuity which the let go bankrupt! That was the old BBN network, the starter of the Internet. They just let it die. So will;l Verizon just fade away in the Internet space as backbones go, doubtful. What will ATT do, good question.

The recent focus has been on the FCC and Net Neutrality, but behind the scenes in the backbone there is a war.

Thus is Google were to buy out Level 3 it would be one of several acquisition steps. Let us look at the numbers.

Level 3 Market Cap = 2.22B
Google Market Cap = 175.37B

A slam dunk for Google, cash or a stock deal! Could Verizon or ATT do this?

Verizon Market Cap = 82.4B
ATT Market Cap = $153B

The answer is anyone of these could and it would bid up Level 3. It would create an interesting opportunity. I suspect that it may very well happen.

Now number two for Google is a position in wireless, well look at Sprint.

Sprint Market Cap = 9.2B

Again it is small change for Google and it gets Google WiMax and cellular and 4G capability.

Are these two moves possible and would they change the landscape. Possible but I come back again to the issue of what is Google's business model. It should be the electronic shopping mall, they may not have to own the roads, yet given the FCC's actions that may find that an inexpensive and strategic move.

Federal Debt Update: Awaiting the New Numbers

The total Federal Debts consists of several elements the two major one being the debt held by the public and the debt held by the Government as a result of taking money from Medicare and Social Security funds. In view of the dramatically increasing debt that we see coming we will be tracking this closely. The data here is up until the end of June of this year.

First the debt in absolute terms. This is shown below and it depicts the growing debts held by third parties. Yet we should be concerned as the new health care plan gets implemented the Government will use it too as a piggy bank, taking in funds for a public plan and then using them.



















The next chart shows these elements as a percent of the GDP.



















Note in the above that we are approaching 90% of GDP as of last June and we anticipate that by then end of this calendar year we will be at 100% or more! By the end of the current Administrations first term we anticipate close to 130% of GDP. This fact seems to be lost in the claims that we need more stimulus. One should be concerned that these ratios will mean devaluing the dollar, inflation, and loss of financial funds to create new businesses. It will make the Carter Administration look like financial giants.

Fall Came and Went

First, welcome to the New England fall, the sugar maples in full bloom.

















Then two days later welcome winter, it made it to 3" by noon! Where is Al Gore when we really need him, more hot air folks. We just planted a quarter acre in time!

Finally, Provincetown in late fall.

Brandeis, the Law and A Few Views

I have been a fan of Judge Brandeis for much of what he accomplished especially with the writing of the classic paper, The Right to Privacy, with his then law partner Warren. (See 4 Harvard Law Review 193 (1890)). Two recent works on Brandeis have appeared and are worth note. The first is an article in The New Yorker by Jill Lepore, a superb piece of critical and historical analysis. Lepore looks at the field of management and efficiency consultants through the work of Brandeis.

She starts her article by stating:

"Ordering people around, which used to be just a way to get things done, was elevated to a science in October of 1910, when Louis Brandeis, a fifty-three-year-old lawyer from Boston, held a meeting at an apartment in New York with a bunch of experts who, at Brandeis’s urging, decided to call what they were experts at “scientific management.” Everyone there—including Frank and Lillian Gilbreth, best known today as the parents in “Cheaper by the Dozen”—had contracted “Tayloritis”: they were enthralled by an industrial engineer from Philadelphia named Frederick Winslow Taylor, who had been ordering people around, scientifically, for years."

The essence of the tale is that Brandeis sitting on a regulatory body which controlled the monopoly like rates of railroads had gotten enthralled with the less than scientific work of Taylor and the Gilbreths. He then saw that railroads should employ these new management techniques and then lower their rates. Simple, except as Lepore states the Taylor results were a fraud! Perhaps there is a lesson here for global warming, telephone interconnection rates and the like. Brandeis was a brilliant legal scholar, however he had no expertise in the area of actually running a company. He did however understand the "books" and as such used this profitably in his law practice. Yet the Taylor approach assumed you looked forward and not backward, that you understood the business and not the records of what happened. Brandeis was a lawyer at heart, as such he always looked backward.

Let me introduce an example.

When I was at NYNEX, now Verizon, in 1989 we had a strike. One of my management people went to strike duty in a customer service bureau. In that bureau, true to Taylor like management, there was a clock and you were timed for every customer contact and you were pressured to make them as short as possible. This manager went there and since he outranked the manager of the bureau he decided to try another tactic. He recognized that people call customer service because they have a problem.

Thus this customer contact was an opportunity to solve the problem, create a happy customer, get customer loyalty, get a word of mouth positive word about the company and even possibly sell more services. He reasoned that the longer the customer service call the better and the primary objective was to make a happy customer. A novel thought especially for a utility. He tried it and surprise it worked. Except for one thing, the system rejected it. The antibodies of the old telephone company attacked and said, "We do not do it this way." Well you know the result.

What is the relationship between this and Brandeis, well Brandeis accepted the "scientific" evidence without and justification, something he would never have done in court. Why did he do this, Lepore seems to believe it was an effect of the times. I would agree but it was also that Brandeis like so many well educated people believe that they can extend well beyond their ken with impunity.

The Lepore article is a review of a book, for which she writes:

"In “The Management Myth: Why the Experts Keep Getting It Wrong” (Norton; $27.95), Matthew Stewart points out what Taylor’s enemies and even some of his colleagues pointed out, nearly a century ago: Taylor fudged his data, lied to his clients, and inflated the record of his success. As it happens, Stewart did the same things during his seven years as a management consultant; fudging, lying, and inflating, he says, are the profession’s stock-in-trade. Stewart had just finished a D.Phil. at Oxford in philosophy when he took a job rigging spreadsheets to tell companies whose business he barely understood how to trim costs, and he feels sullied by it."

This statement clearly shows that Brandeis was easily fooled by the Taylor forces, and that furthermore the consultants that flow to industry from our "best" business schools are oftentimes ignorant of what they opine upon and even worse they are conjurers of falsehoods created to meet certain expectations, perhaps on the part of the client. I have seen many of the top consulting firms send in twenty year old who I had to educate, if such was even possible, and then get them to write in English, all for $500 per hour or more.

Lepore then jumps to the present and she states:

"Much of Stewart’s account is devoted to following the anti-Taylor and neo-Taylor theories that have determined the curriculum at business schools in the course of the past century. He pays special attention to human-factors science and follows through several chapters the work of Harvard Business School’s Michael Porter, whose early books “Competitive Strategy” (1980) and “Competitive Advantage” (1985) launched a field known as strategic management. (I should perhaps mention that, in the late eighties, Porter was my boss. His phone rang off the hook, and I, a temporary secretary, had the job of answering it.) To Stewart, strategic management is scientific management, without the stopwatch. And, along with much else taught in business schools, and everything that goes on in management-consulting firms, “it contributes to a misunderstanding about the sources of our prosperity.”

Business schools have been indicted before. Earning an M.B.A. has been found to have little correlation with later business success. Business isn’t a science, critics say; it’s a set of skills, best learned on the job. Some business schools, accused of teaching nothing so much as greed, now offer ethics courses. Stewart argues that this whole conversation, about people, production, wealth, and virtue, is a conversation about ethics, and is better had within a liberal-arts curriculum. His howl of frustration, after all those years spent living in hotels, peddling nonsense, and profiting by it, is loud and angry. It’s also only half the story."

The point here is quite telling. Professors like Porter take a simple idea which may have some merit and then use it as a template for solving everything including world hunger. Porter has recently authored a book using his wordy methods in the area of health care and in my opinion he would have spent his time more wisely working as a practical nurse at Mt Auburn Hospital for a year of two.

Now back to Brandeis. Whereas Lepore is well written, insightful, clear, perceptive, the recent biography of Brandeis by Urofsky is at the other extreme. The subject of the book is compelling. Each sentence is well written yet each paragraph jumps from thought to thought in a cacophony of words. The book is virtually unreadable. He jumps back and forth so as to give the reader a migraine.

In addition Urofsky addresses the two issues, the Taylor issue and the Privacy issue with the slightest of a touch. The Taylor issue as Lepore states is a truly groundbreaking issues as regards to the courts and judicial thinking. It is one of the first ways in which "scientific" results were introduced into the legal system. Taylor was an "expert" and his results were left unquestioned. In many ways this was one of Brandeis' lowest moments, he failed to do to science what it does to itself, and what is at the core of the legal system as well, adversarial analyses.

Secondly the classic work on Privacy Warren and Brandeis state:

"It is our purpose to consider whether the existing law affords a principle which can properly be invoked to protect the privacy of the individual; and, if it does, what the nature and extent of such protection is."

They then go on to develop the basis of privacy in a well presented case. Regrettably when Brandeis was later to face this issue on the Court he did not confront it with the vigor of this paper. In fact the issue of privacy as a right seems still to be held at arms length except for women's rights. One would suspect that such is rather one sided. (See my paper on privacy, Privacy in the Internet).

The authors, Warren and Brandeis, then state:

"Gradually the scope of these legal rights broadened; and now the right to life has come to mean the right to enjoy life--the right to be let alone, the right to liberty secures the exercise of extensive civil privileges; and the term "property" has grown to comprise every form of possession-- intangible, as well as tangible."

The "right to be left alone" is in many ways a unique American right, which we unfortunately have abandoned. The Government has become more intrusive regarding what we do, say, how we do things, how we interact. There once was a time one could live alone, not the Government intrudes on what Warren and Brandeis saw as a right. This fundamental paper seems to be glossed over at best by Urofsky. It is a pity. Whereas Lepore sees through the fog and makes it clear, Urofsky takes clarity as in the above quote and obfuscates it.

Brandeis had massive strengths and several failings. The Taylor case is a major failing indeed. It sets forth a pattern of Government intervention of at best weak grounds. However the "right to be left alone" was a brilliant insight into what makes America great. Pity is has been neglected and abused.