Net neutrality is dead?

Bret Swanson at the Tech Liberation Front brings good news: net neutrality is dead. Apparently even Lawrence Lessig has changed his mind about it, and Obama seems to be retreating on his promise to deliver net neutrality (thank god). The WSJ reports:

The celebrated openness of the Internet -- network providers are not supposed to give preferential treatment to any traffic -- is quietly losing powerful defenders.

Google Inc. has approached major cable and phone companies that carry Internet traffic with a proposal to create a fast lane for its own content, according to documents reviewed by The Wall Street Journal. Google has traditionally been one of the loudest advocates of equal network access for all content providers. [...]

The developments could test Mr. Obama's professed commitment to network neutrality. "The Internet is perhaps the most open network in history, and we have to keep it that way," he told Google employees a year ago at the company's Mountain View, Calif., campus. "I will take a back seat to no one in my commitment to network neutrality."

But Lawrence Lessig, an Internet law professor at Stanford University and an influential proponent of network neutrality, recently shifted gears by saying at a conference that content providers should be able to pay for faster service. Mr. Lessig, who has known President-elect Barack Obama since their days teaching law at the University of Chicago, has been mentioned as a candidate to head the Federal Communications Commission, which regulates the telecommunications industry.

Edit: Apparently some disagree. Then again, others don't.

The New Yorker on Naomi Klein

Apparently I haven't been reading the New Yorker enough. Here's the third article of the night (morning?), this one an excellent profile of Naomi Klein (who the New Yorker's James Surowiecki did a convincing impression of last month).

On Klein's reaction to the recent financial bailout, Larissa MacFarquhar writes:

It was just as she had written at the end of the book: memory was shock’s antidote. (Another difference, of course, was that the government wanted to enact not Friedman-style reforms but the opposite: enormous interference in the market. Still, since the point of this interference was to bail out banks, this difference did not strike Klein as of much importance.)

And obviously libertarians aren't alone in being frustrated at her imprecise terminology:

It is clear, in “The Shock Doctrine,” just how deeply she disdains the political. She tends to conflate very different right-wing groups—neoconservatives, crony capitalists, libertarians. (In the end, “The Shock Doctrine” is not so much anti-Friedman as anti-corporate.)

The author spends a little too much time on Klein's family life, but it's great nonetheless. Naomi Klein's husband sums it up best in saying "Some people feel that she’s bent examples to fit the thesis."

And, for you typography buffs in the audience, the New Yorker's infamous umlaut makes an appearance.

It's the teachers, stupid!

In contrast to last month's godawful article by James Surowiecki, the New Yorker's got a great article dated tomorrow by Malcolm Gladwell about the determinants of a good teacher. Basically he finds that predicting a teacher's effect on students' learning is impossible without observing them on the job, though it's very obvious when a teacher enters a classroom if they have the stuff or not. The article is a thinly-veiled but very compelling argument for loosening teachers' unions grips on hiring and firing processes, and if you skim through the annoying football subplot, is very much worth your time. As Gladwell puts it:

Teaching should be open to anyone with a pulse and a college degree—and teachers should be judged after they have started their jobs, not before.

That means a lot of hiring, but more importantly, a lot of firing, which is something that public schools and their corporatist unions are not willing to do. But it explains why DC schools are funded as well as Sidwell Friends and still manage to fail in every way imaginable.

Reason.tv on Blagojevich

From reason.tv, this is the best explanation – in print or video – of the Blagojevich scandal and corruption in Illinois politics that I've seen yet.

And a note to all TV personalities out there: Blagojevich is a Serbian name and uses a Serbian transliteration where j makes the sound normally reserved for y in English (as does German and Polish). It's not that hard of a concept to wrap your mind around – get over the damn name.

The New Yorker pulls a Naomi Klein

Late last month James Surowiecki of the New Yorker had a downright bizarre article in which he blames recent food crises on the inherent instability of markets. Except, not quite, because he acknowledges that liberalization "did not cause the rising prices of the past couple of years" – but you could be forgiven for not getting that by the tone of the piece, whose argument seems to be, "Markets have become more free, and yet we still have food crises. Liberalization did not cause these crises, but if it did, wouldn't that suck?" After all, what's the point of spending half the article talking about food insecurity and the other half talking about market liberalization if you don't think the latter caused the former?

Incredibly, Surowiecki manages to get through a whole article on liberalization and the latest food riots without once mentioning the decidedly illiberal roots of the crisis: biofuel subsidies. In fact, he goes so far as to implicitly deny what seems to be the general consensus on biofuels being the cause of the recent spike in food prices, saying that it happened "for reasons that now seem not entirely obvious."

He commits another intellectual massacre when he says that an effect of agricultural liberalization has been market concentration, in that "three countries provide ninety per cent of corn exports." Here's some news for Surowiecki: the US exports the vast majority of this vast majority of corn, and this is due largely to its subsidies to corn growers.

Two of his main gripes – volitile commodity prices and concentrated production – are clearly caused or at least exacerbated by illiberal government intervention in food markets, and yet, when he gives his opinion of what world agriculture needs, "doing away with import tariffs" is the only market-oriented step he can come up with. So what we're left with is a short synopsis about how farming has become more liberalized, a short description of the latest food price spike which Surowiecki admits has nothing to do with liberalization, and the inexplicable and unbacked assertion that the answer is less liberalization and more agricultural autarky. It looks like Surowiecki's pulled a Naomi Klein – he's picked an interesting and profound subject, marshaled some compelling evidence, and come to a spectacularly wrong conclusion.

Are foreign automakers in the South subsidized?

With Detroit getting criticism from free-market types for seeking government money, pundits on the left are pointing to the subsidies and incentives that foreign car manufacturers in the American South get. Jane Hamsher at the Huffington Post talks about her appearance on Fox Business where she said that subsidies to foreign automakers give them a "tremendous advantage" in the South – but is that really true? Surely the subsidies are real – Daniel Gross at Slate chronicled the rise of the non-union foreign auto plants in states like Alabama and South Carolina and notes the hundreds of millions of dollars in tax breaks and incentives that state governments bid to attract foreign automakers. But as for whether or not the special incentives are actually the reason the manufacturers locate there – that is, is it actually a "tremendous advantage" or just an unnecessary perk? – that's a different story.

As Rondinelli and Burpitt tell it in a 2000 paper on the impact of government incentives on FDI in North Carolina, the academic consensus is that these programs are largely just politicians trying to prove their usefulness to voters, and that special incentives rank very low on the list of reasons why foreign manufacturers actually set up shop in the South. The lack of unions and fewer labor regulations rank highest, followed by general business climate and access to transportation infrastructure (itself often a subsidy, but Michigan and the Rust Belt are just as well connected to rail and road networks). Marketing efforts by states, specific incentives such as state-sponsored job training, and tax breaks figure lowest in the decision-making calculus.

But there is one more subsidy that I've heard of – in the aforelinked Slate article, Gross mentions that "federally subsidized power from the Tennessee Valley Authority" is one reason why foreign automakers began building plants in the southeastern US in the 1980s. It is definitely true that TVA power – which accounts for a quarter of total American electricity generation – is heavily subsidized: Richard Munson notes that despite its terrible financial shape, the TVA has an AAA bond rating – a surefire sign that investors see it, like Fannie Mae and Freddie Mac, as essentially having the backing of the US Treasury, regardless of what the TVA's leadership would have taxpayers believe. Jane Jacobs, over twenty years ago, got into a NYRB-mediated spat with the TVA's chief economist, and said that "abundant and relatively cheap electric power [underpins] the TVA region's entire economy and standard of living." But this sounds like an exaggeration when applied to automakers. While buidling cars definitely relies more on electricity as an input than your average American service sector job, I doubt that the subsidy that industrial electricity buyers receive is enough to lead foreign car makers to choose the region over Michigan (as the TVA's Allan Pulsipher noted, the TVA's subsidies are given mostly to residential users).

So if Detroit's backers want to argue for the bailout plan, they ought to stop using foreign automakers' subsidies as an excuse for their own. It's becoming increasingly clear to me that it's the unions that have led American automakers down their present path, and it's the lack of restrictive labor laws that allows the South's car industry to thrive.

Non-food biofuels could increase the risk of invasive species and (wild?)fires

Here's another downside to non-food biofuels, which Obama has made part of his alternative energy subsidization plan: the crops used to make the biofuel are often invasive species, and some raise the risk of fires. Researchers from the Nature Conservancy and the Global Invasive Species Programme give the huge and slightly unbelievable number of 5% global GDP as the current cost of invasive species, for some perspective on the impact of invasive species.

There are other downsides to non-food biofuels. Environmentalists have concerns that these non-food biocrops will crowd out farmland and otherwise natural land in the global south, and I have concerns that the cultivation of non-food grasses will further degrade the Praire Pothole Region.

Senate seat sale an open secret?

Via Talking Points Memo, the sad truth about Blagojevich's corruption as reported by the NYT:

“It was open knowledge among people in and around Springfield,” Mr. Raoul said. “Legislators and lobbyists alike openly talked about the fact that the governor would want to appoint somebody who would benefit him. I can firmly say that I’ve had these conversations, that I’ve spoken with both legislators and lobbyists who felt that that would be the consideration in his appointment.”

Is Houston really unplanned?

It seems to be an article of faith among many land use commentators – both coming from the pro- and anti-planning positions – that Houston is a fundamentally unplanned city, and that whatever's built there is the manifest destiny of the free market in action. But is this true? Did Houston really escape the planning spree that resulted from Progressive Era obsessions with local planning and the subsequent grander plans of the post-WWII age of the automobile? Michael Lewyn, in a paper published in 2005, argues that commentators often overlook Houston's subtler land use strictures, and recent developments in the city's urban core reaffirm this.

It is definitely true that Houston lacks one of the oldest and most well-known planning tools: Euclidean single-use zoning. This means that residential, commercial, and industrial zones are not legally separated, though as I will explain later, Houston remains as segregated in its land uses as any other American city. But single-use zoning is not the only type of planning law that Houston's government can use to hamper development.

As Lewyn lays out in his paper, minimum lot sizes and minimum parking regulations abound in this supposedly unplanned City upon a Floodplain. He discusses a recently-amended law that all but precludes the building of row houses, a stalwart of dense urban areas (the paper is heavily cited and poorly formatted, so I've removed the citations):

Until 1998, Houston's city code provided that the minimum lot size for detached single-family dwellings was 5000 square feet. And until 1998, Houston's government made it virtually impossible for developers to build large numbers of non-detached single-family homes such as townhouses, by requiring townhouses to sit on at least 2250 square feet of land. As Siegan admits, this law "tend[ed] to preclude the erection of lower cost townhouses" and thus effectively meant that townhouses "cannot be built for the lower and lower middle income groups." Houston's townhouse regulations, unlike its regulations governing detached houses, were significantly more restrictive than those of other North American cities. For example, town houses may be as small as 647 square feet of land in Dallas, 560 square feet in Phoenix, and 390 square feet in Toronto, Canada.

Though this law was eventually changed to allow denser homes within Houston's ring road (though not nearly as dense as some American cities allow), this change only affected a quarter of Houston's homeowners, leaving the rest still as regulated as ever. Not to mention the fact that even for those within the ring road, the rules only matter to new construction, leaving the vast majority of the building stock in compliance with the old rules.

Not to be outdone by minimum lot restrictions, the parking planners are also hard at work in Houston. As Donald Shoup explains in his magnum opus on parking regulations and the free market, minimum parking regulations are an oft-used and under-appreciated way for city planners to decrease density, push development farther from the city's core, increase an area's auto dependency, and decrease walkability and the viability of mass transit. Houston's planning code mandates that developers, regardless of what they perceive as the actual demand, build 1.25 parking spaces per apartment bedroom, and 1.33 spaces per efficiency apartment. Retail stores are also saddled with these parking minimums, and even bars as Lewyn notes are required to build "10 parking spaces per 1000 feet of gross area," flying in the face of common sense. To add insult to injury, the city requires that structures on major roads have a significant setback from the street, and the only rational thing to do with this unbuildable space is to put the mandated parking there, meaning that Houston actual codifies the hideous and inconvenient parking lot-out-front model of sprawl that is so typical across the US.

Another form of planning that Houston has, which is celebrated by the self-titled Antiplanner, is the institution of supposedly voluntary deed restrictions, or private land use covenants agreed upon by the owners of the property under restriction. I'm personally torn over the "libertarianness" of such schemes – are they truly voluntary? Can an individual owner of a property opt out of them once they've been signed? What's the statute of limitations? One thing that makes me suspect that they perhaps aren't as "free market" as they seem is that though the contracts are between individuals, Houston's city code allows the city attorney to prosecute these lawsuits at no cost to the supposed victims – fellow property-owners. In this way, as Lewyn explains, Houston's land uses are just as "Euclidean" as in other American cities:

But in Houston, restrictive covenants are so heavily facilitated by government involvement that they resemble zoning regulation almost as much as they resemble traditional contracts. Houston's city code, unlike that of most American cities, allows the city attorney to sue to enforce restrictive covenants. The city may seek civil penalties of up to $1,000.00 per day for violation of a covenant. Thus, Houston forces its taxpayers to subsidize enforcement of restrictive covenants even when litigation is too costly for individuals to pursue. In its covenant litigation, the city focuses on enforcement of use restrictions (that is, covenant provisions requiring separation of uses), as opposed to enforcement of other restrictions such as aesthetic rules. By subsidizing enforcement of use restrictions, Houston's city government subsidizes segregation of land uses--and in fact, land uses in Houston are only slightly less segregated than in most cities with zoning codes.

More recently, Houston's supposedly laissez-faire attitudes towards planning have again been tested by the proposed 23-story tower at 1717 Bissonnet Street. The tower would have been in a low-rise residential neighborhood, within walking distance of Rice University. After years of wrangling, the project was finally denied by the city, on grounds that the developers failed to prove that the project would not adversely affect traffic flow (a pretty arbitrary and un-libertarian requirement considering Houston's legendary congestion and the fact that developers have little say over where the city places its roads). And this, despite the fact that many of the tower's prospective residents – Rice students and staff – could have either walked or biked to school/work.

Boosters of Houston's land use policy – those who believe that Houston's land use patterns are the free market, revealed – never mention the restrictive minimum lot size and minimum parking requirements. They mention deed restrictions as free market innovations but fail to see how the city's prosecutors turn private concerns into public budget drains. And though the Antiplanner in his aforelinked comments on Houston recognizes the anti-density movement that reared its ugly head after the 1717 Bissonnet proposal, he evidently doesn't see this as seriously detracting from Houston's anything-goes land use policy.

Politkovskaya's killers

The trial of the suspected murders of Anna Politkovskaya, which up until now has been sort of a farce, has revealed some startling (but unsurprising) accusations by a deputy editor of Politkovskaya's former newspaper: the suspects were agents of the FSB. Though Novaya Gazeta editor Sergei Sokolov declined to give his source, he fingered defendant Dzhabrail Makhmudov as an agent, and FSB officer Pavel Ryaguzov as his minder – obviously, both denied the charge.

The Moscow Times adds this example of how the FSB might have ordered the killing and convinced the agents to not expose the FSB's role:

"[The defendents' uncle Lom-Ali Gaitukayev] recruited his nephews and several of his acquaintances to commit the crime," he said.

Sokolov said Gaitukayev was also in contact with Kazbek Dukuzov, who was acquitted of the murder of Paul Klebnikov in 2006, and Rustam Makhmudov, a brother of the defendants who is suspected of being the triggerman in the Politkovskaya killing and is believed to be living abroad.

Separately, Gaitukayev said in court that he had heard from investigators that the killers were paid $2 million, defense lawyer Andrei Litvin said. The court was closed to journalists while Gaitukayev gave evidence because prosecutors said he might reveal state secrets.

Litvin, the lawyer of [co-defendant] Khadzhikurbanov, also told journalists outside the courtroom that his client had been pressured by investigators to confess that the murder was ordered by self-exiled businessman Boris Berezovsky for a payment of 4 million euros ($5 million).

For more information on why Politkovskaya was murdered, and the information that might have gotten both her and Alexander Litvinenko killed, check out this article by Larisa Alexandrovna at The Raw Story.