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Links and Quotations for September 4, 2015: why time passes, what makes an iPod like Luke Skywalker, and more
Why does time pass? And how did we go from a walkman to an iPod, and who was creatively destroyed in between? That and more choice picks here.
‘I dropped out of college to work as an Uber driver and have no regrets’ – Fusion
Some Nail Salon Owners in New York Push Back Against Increased Regulation – NY Times
What Do The App Store, PlayStation 2 And The Roman Empire Have In Common? – TechCrunch – Here’s a clue: it has to do with rise and fall.
How Record Labels Conspired To Kill Off Public Domain Beatles Music In Canada – TechDirt
Earlier this year, we discussed that, thanks to shorter copyright terms in Canada, things like early Beatles recordings and James Bond had entered the public domain up north. It was no secret that the recording industry was totally freaked out about this, and that resulted in the somewhat bizarre situation in which Canadian Prime Minister Stephen Harper single-handedly extended copyright on sound recordings for 20 years by sticking it into a budget update, without any public discussion or concern about the fact that he was simply wiping out twenty years of use of works that the public had been promised.
Of course, this extension only applied to works that hadn’t yet fallen into the public domain, so there is still a small window of early 1960s sound recordings that are, in fact, in the public domain. One company, Stargrove Entertainment, sought to take advantage of this, and released a CD of public domain Beatles music, selling it at various retailers like Wal-Mart, and causing it to be the top selling CD in Canada for a little while. And that’s when the recording industry struck back.
Why does time pass? – The Economist
Walkman to iPod: Business-Model Transformation – Re/code
You’re either going to disrupt or be disrupted in a digital transformation. As we all know, the pace of change has been intense. The incremental innovation that is out there is normal, but companies that follow that approach won’t be able to keep up.
Consider the Sony Walkman. It was invented nearly 35 years ago. One could argue that this was Sony’s big transformational innovation, the one thing that really put Sony on the map as an innovator. … Sony actually hasn’t really innovated in the past 35 years.
[…] Sony wanted to be Apple. Sony had all the digital IP and design — the same components Apple had. But Sony didn’t want to cannibalize its existing music business with a new business model, so Apple eventually took that digital mantle away from Sony. Then Apple released another breakthrough innovation — the iPhone. The iPhone singlehandedly destroyed 27 business models.
US job growth in August slowed from July — to 173,000 from 245,000 — as the unemployment rate fell to the lowest level since 2008, 5.1%. The Wall Street Journal offers a nice summary of the data, and what it might mean for the Federal Reserve’s upcoming interest rate decision.
Now jobs in the private sector — you know, the part of the economy producing “actual consumer-relevant value,” as economist Tyler Cowen has put it — rose by just 140,000, the smallest gain in five months. Economist Robert Brusca is unimpressed, noting that “result lies in lower 17% of its queue of results over the last 59 months when jobs have been expanding. Government jobs however are the second strongest they have been over this period. That gain is what saved the headline from further embarrassment.”
Overall, government jobs were up 33,000 while “goods-producing sectors had one of their worst months of the expansion, with employment dropping 24,000: mining got hit for another 9,000 jobs and factory employment fell by 17,000,” according to JPMorgan. Now there will be revisions, and August seems to be a month were the first print tends to undershoot. So we’ll see if the month was stronger than first appearances suggest.
Links and Quotations for September 3, 2015: Police cameras, unlikely STEM hubs, low tech rescuing high tech minds, and more
Could reading a low tech book make it easier to handle a high tech world? That, a computer recreating Van Gogh, and why we need geeks in government… all here.
Computer algorithm recreates Van Gogh painting in one hour – The Guardian
Police Cameras: The Secret Economy – FastCompany – “This means big money for the companies offering storage services.”
Bloomberg’s Future Is the Future of News for Everyone – Wired
The Unlikely Cities That Will Power the U.S. Economy – Bloomberg
Europe’s Latest Export to America: Internet Censorship – RealClearTechnology – “The concept of a “right to be forgotten” is now spreading to other countries. Russia has just enacted its own such law, no doubt seeing its potential as a tool for political censorship. The Russian law is openly modeled on the European example. … America may be the next stop for the right to be forgotten.”
Hey Male CEOs, It’s Your Turn to Take Parental Leave – Wired – “Researchers say that a crucial step in allaying those fears [of puting their standing on the job and future opportunities at risk] is setting the example from the top: executives and managers must lead by example, embracing a company’s policy to show employees that it isn’t just for show (or for hiring). But it isn’t always so easy to do as to say. Taking time off is a personal choice—and some people, well, love to work. CEOs also face heightened scrutiny from shareholders, board members, and the public.”
The U.S. Government Needs to Hire More Geeks – Harvard Business Review–
However, in the months that followed these successes, the Healthcare.gov website became perhaps the most public technology failure in American history. The website failed not because the project was technically infeasible, but due to overly prescriptive, tech-unaware legislative language, coupled with product development mismanagement by bureaucrats lacking the appropriate know-how.
The former is the responsibility of the legislative branch, and the latter the responsibility of the executive branch. We need innovation in both branches.
[…] In the 21st century, policy doesn’t work unless the technology works. That simple truth is why we need a federal government — including both the executive and legislative branches – that understands technology and innovation and infuses best practices from Silicon Valley into the very fabric of government. We need to invite more techies, more data geeks, and more innovators to the policy table. If we do, I can only imagine what the Congressional Innovation Fellows and their partners might accomplish — and whose life they might save.
How Making Time for Books Made Me Feel Less Busy – Harvard Business Review
I work in the world of book publishing. I’m the founder of LibriVox, the largest library of free public domain audiobooks in the world; and I spend most of my time running Pressbooks, an online book production software company. I might have an unpublished novel in a drawer somewhere.
I love books. And yet, I wasn’t reading them. In fact, I couldn’t read them. I tried, but every time, by sentence three or four, I was either checking email or asleep.
I started to wonder: could training myself to read books again help me manage the digital information stress in the rest of my life? Could the cure for too much information be slower information? In the same way that snake venom can be used to produce curative antivenom, I wondered whether that old, slower form of information delivery—books—could act as a kind of antidote to the stress caused by the constant flow of new digital information. Whether my inability to sustain my focus—at work, home, and on reading books—could be cured by finding ways to once again sustain my focus…on a book.
In my latest The Week column, I investigate why gold standard proponents might be upset with President Obama renaming Mt. McKinley to Denali. From the piece:
If Obama wanted to subtly troll the gold-bug wing of the right, renaming Mt. McKinley would be a crafty way of doing so. Over at Breitbart, editor Ben Shapiro argues that Obama “likely opposes” how McKinley “rejected inflation by sticking with the gold standard.” And the editors of the New York Sun argue that McKinley’s electoral victory meant “passage in 1900 of the Gold Standard Act, which set the stage for the great boom of the 20th century.” Clearly, honor must be paid.
The return of old-fashioned gold bugs to modern center-right politics has been one of the more unhelpful political repercussions of the Great Recession. They’ve nudged GOP economic dogma toward an unfounded obsession with debt, inflation, and austerity. It’s all pretty much nonsense. Despite never-ending warnings that a second financial crisis is nigh, inflation has been below the Federal Reserve’s two percent target for 38 straight months. New projections for the fiscal 2015 budget deficit show the smallest gap since 2007 and below the 50-year average. And rather than a collapsing dollar wreaking havoc, it’s been a strong greenback that’s been an economic headwind. Indeed, if it had been up to the hard money crowd, the Federal Reserve would have followed the same disastrous, inflation-phobic policies of the European Central Bank.
Please read the whole thing, though I am annoyed at myself for forgetting to add this economist survey:
Goldman Sachs is out with a note about its political forecasting model, and how the economy might affect the 2016 White House race. According to the Goldman model, the fundamental factors that matter most are real GDP, real consumption, and real personal income. With the 2012 election added to the sample, the change in non-farm payrolls also seems to have acquired more predictive power. And the stock market? Not so much.
Timing matters, too. Goldman: “It is only around the current stage of the presidential cycle (i.e., late in the year before the election) that economic variables tend to become useful in predicting the outcome, and not until Q2 of the election year that many indicators reach their maximum predictive value.” The bank also includes whether the incumbent party has held office for at least two terms, kind of a “fatigue” factor I suppose.
So here is what the model churned out:
Regarding the more important fundamental indicators, our current economic forecast implies a close race. However, the outcome depends heavily on the model chosen. Considered in isolation (i.e., in a bi-variate regression), our forecasts for three indicators with the greatest predictive value—real GDP growth, real per capita personal income growth, and the change in non-farm payrolls—all suggest that the Democratic candidate should win just over 50% of the popular vote. However, adding the incumbent party dummy variable described above shifts the results by an average of 3 percentage points, transforming a narrow win for the incumbent party into a loss with around 47% of the two-party vote.
Several caveats are in order. First, we do not know who the candidates are, and early polling—which is itself not of much use—shows a wide dispersion of voter preferences depending on the individual candidates. Second, it is early enough in the campaign that the actual economic data—itself subject to revision—don’t give us much of an idea about the eventual winner. Instead, we must rely on our own forecasts of those variables, which are apt to change as events unfold. Third, it is the electoral college, not the popular vote, that determines the election outcome. There is normally a small “bias” toward one party in the electoral college, so that one party could lose some of its popular vote without actually losing any electoral votes. In a close election, this bias is typically worth less than one percentage point of the popular vote, but has occasionally been enough to swing the result (in 2000 and 1888, for example). Recent research suggests that the current concentrations of partisan support going into the 2016 election could favor the Democratic candidate by one to two percentage points. If the pattern holds, this would imply a closer contest than the figures above suggest. The upshot is that, if our economic forecast proves correct, the economic data should make for a fairly even playing field.
Links and Quotations for September 2, 2015: Airbnb corrects NY housing, China-US corn war, the psychology of entrepreneurs, and more
With all the news on China, bet you missed that the US and China are fighting to dominate the global food supply. That and more surprise reads here.
Why More Employees Are Going Back to Their Old Jobs: The rise of the “boomerang” workforce – Bloomberg
Uber now faces class action lawsuit in California over expenses, tips – ArsTechnica
We’ve Become So Obsessed With ‘Innovation’ That It’s Now Meaningless – Entrepreneur
How Airbnb actually makes NYC affordable – NY Post–
As The Guardian reported last year: “With the average rent in New York hitting $3,000 a month and some areas of San Francisco cresting even higher, after 10% increases last December alone, the system is so stacked against most regular residents that it’s hard not to see Airbnb as a tiny correction to one of the most depressing things about these cities: $2,800-a-month studios and real-estate ads that consider it a genuine enough boast to promote that ‘every room has a window!’ In this context . . . Airbnb makes sense from both sides.”
Airbnb isn’t eroding the city’s stock of housing. It’s helping residents cope with the inflationary effects and price fluctuations of the city’s existing housing market. It may be technologically disruptive — but it’s economically stabilizing.
Corn Wars: The farm-by-farm fight between China and the United States to dominate the global food supply – The New Republic
If China hopes to feed (and pacify) its growing population while also loosening the very real stranglehold that America has on its national food supply, its farmers have to start producing a lot more corn—not just enough to meet their domestic demand in good years but enough to maintain a stockpile to offset their global market impact during bad ones. For decades, China has increased corn yields by putting more acres into production, but they’re running out of arable land, and the USDA now estimates that Chinese corn consumption will rise by 41 percent by 2023, far outpacing production increases. The only tenable way for China to meet its own demand, then, is by planting high-performance hybrids, which can single-handedly double or potentially even triple per-acre corn production. Chinese scientists haven’t developed a significant corn hybrid in years. But Monsanto and DuPont Pioneer, the two American seed giants, have produced so many successful hybrids that they now control 45 percent of all the seed sold in the world.
Not All Unicorns Are Created Equal- Re/code –
Recently, there’s been a certain frothiness surrounding the stock market. Whether or not we’re experiencing a correction, a mood swing, or simply coming back to Earth after six years of growth, is all up for debate. Interestingly enough, though, the entire scenario has called into question the valuation of many companies in the tech space. A “unicorn bubble,” so to speak. Roughly translated: Are there really a myriad of relatively new companies that can possibly be worth a billion dollars or more? What is the criteria, and if they received a new valuation today, would they still hit that esteemed metric?
The Psychology of Entrepreneurs Drives Business Outcomes – Gallup –
Gallup — from our assessment of 2,500 U.S. entrepreneurs — adds that higher levels of entrepreneurial talent significantly increase one’s odds of business success. Highly talented entrepreneurs, compared with their less talented peers, are:
-three times more likely to build large businesses and to grow them significantly
-four times more likely to create jobs
-four times more likely to exceed profit goals
-five times more likely to exceed sales goals
In short, entrepreneurs’ psychology and innate talents are predictors of business success.
Leaders who want to uncover the people with the right makeup to build and sustain a business should understand this fundamental point.
This is good. US productivity in the second quarter grew at the fastest pace since the end of 2013, according to revised government figures. But if you pull back the camera, longer-term productivity growth remains terribly worrisome. IHS Global Insight:
This update does not change the underlying story. Productivity growth remains low. The slowdown started about 10 years ago. The Great Recession muddied the data, making it difficult to tell whether the slowdown was a byproduct of the business cycle or something fundamental. In recent years, it has become clear that something was fundamentally off.Productivity’s slow pace has the profession puzzled. Some economists have concluded that today’s innovations are simply not as path-breaking as those that supported previous productivity booms. Others believe that the numbers are plain wrong because government statisticians have not figured out how to measure the value of recent innovations.Should we be worried about productivity? If the numbers are being measured correctly, yes because in the long-run, productivity is the best measure of an economy’s success. Applying the Rule of 72, if growth is 2%, the pie doubles every 35 years, if growth is 1%, it doubles every 72 years and, as it is now, if growth is 0.5%, it doubles every 144 years.
Or look at it this way: Capital Economics points out in a recent note that real worker compensation has increased by an average of just 0.6% over the past decade vs. 2.3%, 1995 to 2005. But without “the slowdown in productivity growth that began a decade ago, real incomes would be 10% higher than they actually are today.”
If productivity growth stays this slow and you assume 1% labor force growth, then America’s potential growth rate isn’t even 2%. The pie may double only every half century. While Democrats are focusing on their demand-side, consumer-oriented “middle out” economics, the US economy may well face serious supply-side issues.
But the official statistics on GDP growth fail to capture most of the gains in our standard of living that come from new and improved goods and services. That means that the official growth rate does not reflect the rise in real incomes that came with air conditioning, anti-cancer drugs, new surgical procedures, and the many more mundane innovations. Moreover, because the US government does not count anything in GDP unless it is sold in the market, the vast expansion of television entertainment and the introduction of services like Google and Facebook have been completely excluded from the national account.
And economist Brian Wesbury in a morning note today:
So, while the most recent quarter was solid, the past few years have seen productivity improvements noticeably slower than the average gain of 2.3% since 1996. However, we do not think the productivity revolution has come to an end. More importantly, we think actual productivity growth is much stronger than what the government reports. (For example, do the data fully capture the value of new technologies like smartphone apps, the tablet, the cloud,…etc.?) The benefits to consumers and businesses have been huge, but the figures from the government miss the value of these improvements. Most of these amazing productivity boosting technologies are free – and anything free, no matter how much it improves everyday life, isn’t included in output – which means they aren’t included in productivity either. This means our standard of living is improving faster than the official reports show.
Policymakers should assume the worst and act accordingly.
Links and Quotations for September 1, 2015: Unicorns and angels, Pay-for-success contracts, why nuance is overrated, and more
Did you know nuance could be overrated? That and more gems below.
The Real Unicorns Are Female Angel Investors – TechCrunch
Google Life Sciences Makes Diabetes Its First Big Target- Wired
This is how your brain judges others’ personalities – FastCompany
As India Goes After Google, A Simple Question: Do You Really Want Governments Deciding Search Results? – TechDirt
Is Nuance Overrated? – Chronicle of Higher Education –
Nuance is revered in higher education. … Which is why it came as such a surprise — and perhaps a relief — when Kieran Healy, an associate professor of sociology at Duke University, last week brought a blunt message to the American Sociological Association’s annual meeting: “F**k Nuance.” […] Nuance can elucidate the complexities of the world, says the Duke sociologist, but too often scholars use it to bury anything resembling a clear, forceful idea. “We want our abstract concepts to do something for us,” he says, but nuance-worship “makes us shy away from the riskier aspects of abstraction and theory-building.”
The paper struck a chord. It has been downloaded more than 12,000 times since it went online, on Thursday, according to Mr. Healy. “I’ve definitely not had an academic-conference paper get this much attention so fast before,” he says.
We’re at Cyberwar: A Global Guide to Nation-State Digital Attacks – Wired – “Our assessment is, of course, based only on known attacks. And attribution is often tricky. It’s difficult, forensically, to distinguish nation-state attacks from those of independent groups—even more so when China and Russia use state hackers and also pay freelancers when they gain access to useful systems.”
The 26%: Leading Roboticist Highlights Glass Ceilings in Tech – Re/code – “For Re/code’s third installment of “The 26%: Women Speak Out on Tech’s Diversity Crisis,” we sat down with Melonee Wise to discuss the issues that women face in the field. […] She was previously the lead roboticist at pioneering robot company Willow Garage… She subsequently founded Unbounded Robotics and more recently Fetch Robotics, which… recently secured a $20 million investment from SoftBank, Shasta Ventures and O’Reilly AlphaTech Ventures.”
A Revolution Of Outcomes: How Pay-For-Success Contracts Are Changing Public Services – FastCompany
Also called “social impact bonds” (though the contracts aren’t really bonds), pay-for-success (PFS) is a hot idea among people who want to see more accountability and experimentation in government. PFS offers new sources of funding from investors who want to see innovative ideas tried, they say. It encourages risk-taking, as governments don’t have to come up with upfront money, and they only pay investors if the intervention succeeds. And, PFS brings with it new standards for recording and analyzing data, and for assessing the actual effectiveness of interventions. […]
Overholser [CEO of Third Sector Capital Partners] argues that we shouldn’t judge PFS simply by whether the programs hit their targets, though. Even if they fail, they will still be worthwhile. “If it doesn’t meet its outcome target, that’s a form of success as well, in the sense that the feedback loop has taught us something,” he says. “It’s like venture capital in that way. No venture capitalist ever made an investment that they thought was unlikely to work. But they know the world is a complex place and, therefore, they don’t always work.”
The promise of PFS, in other words, is not so much that it will solve every problem. But rather that its process will begin to tell us what might work and not. In that way, it’s more like the experimentation that scientists do in the lab, or that business strategists carry out within companies. It’s a method of innovation where failure comes with the territory.
Why the Future of Social Science Is with Private Companies – HBR –
When it comes to generating breakthrough insights around choice, preference, bias, affinity, creativity and decision—all the psychological elements and ingredients that go into making humans human—industry, not university, is far better positioned to design, develop and deploy replicable experiments that matter. … This shift has, of course already begun. Google, Facebook, Amazon, Microsoft, Netflix, Alibaba and scores of other global enterprises conduct literally thousands of experiments on their networks every day. No doubt, many or most of them are marginal or incremental in design. But with literally billions of measurable customer, client, and channel interactions a year, be sure they’re also testing hypotheses that could lead to profitably disruptive innovations.
Is this true, I wonder? From the Wonkblog reporter Matt O’Brien:
A few thoughts:
1.) Some policies Donald Trump is talking about are clearly contrary to what most Republicans think of as “supply-side economics.” Raising trade barriers and investment taxes are two that most immediately come to mind. I mean, classic, 1980s-style supply-siders blame the Great Depression on 1930s protectionism, after all. But we’ll see if Trump’s tax plan more or less adheres to the idea that lowering marginal tax rates is the single most powerful economic level at the disposal of policymakers. I am guessing it will be a big tax cut for pretty much everybody. There are three things I am really looking forward to right now: autumn, “The Force Awakens,” and the Trump tax plan. And not necessarily in that order.
2.) As for the popularity of supply-side economics, I’ve written a bit about polls suggesting the public is deeply skeptical of the idea that lower tax rates on business and the wealthy will help everyone else.
3.) As far Republicans go, Tea Party types seem to be more concerned about small government generally than low taxes specifically. At least that’s my impression. And there also seems to be skepticism about wealth created by bankers benefiting from Too Big To Fail. On the hand, entrepreneurs still seem greatly admired, and I would guess most Republicans think low taxes are helpful in encouraging high-impact startups. It is also worth mentioning that politically successful Republican tax plans have typically combined high-end and middle-class tax cuts, rather than being exercises in ideological purity. Tax cuts for everybody. One might argue that the revealed GOP preference on taxes has been broader than what one might read in “The Way the World Works.” If you think about 1980s supply-side economics as low taxes, tight money, and free trade, certainly the first two seem like they are still core GOP issues given hostility to the Fed’s bond buying and the popularity of low-rate tax plans like the flat tax or fair tax. At the same time, there is growing interest in issues such that are not part of the traditional supply-side portfolio, such as higher education and healthcare. Which is great.