? October 2004 | Main | December 2004 ?
November 30, 2004
K-rations and dieting
Ancel Benjamin Keys, PhD., the inventor of the K-rations that kept Allied troops alive and reasonably well fed on the battlefield during WWII, died last week at the age of 101.
But the greater contribution of Dr. Keys is even more interesting. As Sandy Szwarc notes in this TCS op-ed, Dr. Keys' greatest scientific contributions are to our understanding of the human body and eating.
Inasmuch as the mainstream media in America is obsessed with dieting and a svelte figure, few Americans who read Dr. Keys' obituary know that, over half a century ago, he conducted the soundest clinical studies ever done on the adverse effects of dieting. His findings -- which have been confirmed many times since -- proved that dieting can actually cause severe physiological and psychological harm, often results in people becoming fatter, often leads to eating disorders, and even increases the risk for heart disease and life shortening illnesses.
As Ms. Szwarc notes:
The extreme physical and mental effects [of restricted diets that] Keys observed led to his famous quote:"Starved people cannot be taught democracy. To talk about the will of the people when you aren't feeding them is perfect hogwash."
Posted by Tom at 7:24 AM | Comments (0) | TrackBack (0)
Merck is parachuting
Merck's board has approved golden parachutes from 230 of its top executives.
On the heels of the problems noted in earlier posts here and here, my sense is that Merck's board did not have particularly good timing in approving these parachutes.
Posted by Tom at 6:29 AM | Comments (4) | TrackBack (0)
A hedge fund for sports gamblers
Dallas Mavericks owner Mark Cuban is fed up with the what he thinks is the roulette nature of the stock market. He has concluded that stock investing is not much different than gambling in Vegas, so for those who like to wager, he has come up with a better idea -- a hedge fund that bets on sporting events.
"The goal of the fund would be to make money and to prove that the current equity markets are more Ponzi scheme than efficient markets," Mr. Cuban said in his blog post announcing the hedge fund. "There is far more hypocrisy in equity markets than there is in non-traditional markets and that impacts those markets' ability to be fair.""I've decided to start a new hedge fund. However, this hedge fund won't invest in stocks or bonds. It's going to be a fund that only places bets – a gambling hedge fund."
Mr. Cuban reasons that stock investing is generally unfair and that most gamblers have better information about their local sports team than investors do about a company. Inasmuch as the media reports on every hangnail suffered by a member of a local sports teams, Mr. Cuban contends that the media releases much more and better information than publicly traded companies.
Mr. Cuban has not yet provided many details about the venture, such as when the fund will be up and running, which sports the fund will bet on or what it will be called. He does say he will not pick the bets and that professionals will run the fund.
While a hedge fund run by professional gamblers may sound a bit far-fetched, the hedge fund industry has a long history of engaging in rather unusual trading strategies. Until recently, hedge funds were lightly regulated on the theory that people participating in them were sophisticated investors and able to take care of themselves. But in recent years, there has been an substantial increase in the number of hedge funds and the SEC has adopted more stringent rules. Accordingly, if Mr. Cuban's fund raises more than $30 million in assets and has at least 15 investors, the advisers of the fund will have to register with the SEC by February 2006. This means that the advisers would have to disclose to the SEC their identities, the amount of money that they are managing, and the identiay of the fund's compliance officer. Mr. Cuban will probably set up his fund so that it is open only to accredited investors, which normally have at least $1 million in assets.
Mr. Cuban concludes his blog post with his real purpose in starting the fund:
"By showing that gambling in the traditional sense is less of a gamble than gambling in the stock market, traditional markets will hopefully have to change to the benefit of investors."
My sense is that this fund is going to be a bit more sophisticated -- although no more competitive -- than the traditional Kirkendall Family Bowl Game Pool that takes place each holiday season. ;^)
Posted by Tom at 5:58 AM | Comments (1) | TrackBack (0)
November 29, 2004
More gas trader indictments
U.S. prosecutors charged five former natural gas traders for allegedly supplying fake trade data to publishers that produce indexes used to value natural gas contracts. This post and this post refer to earlier indictments of the same nature against other El Paso Corp. traders.
Prosecutors alleged that two of the traders - Donald E. Burwell and James P. Phillips - operated as part of a conspiracy at El Paso Merchant Energy run that the government alleges was run by the head of gas trading. The executive who allegedly ran the conspiracy was not identified in the indictments.
Messrs. Burwell and Phillips, along with former El Paso trader Greg Singleton and former Dynegy Inc trader Michelle Marie Valencia were all charged with conspiracy, wire fraud and false reporting. A fifth trader -- Jerry A. Futch Jr. -- formerly of Reliant Energy Corp, was charged with four counts of reporting false transaction data. All five defendants pleaded innocent at an arraignment Monday and were released on $50,000 bond.
In an interesting twist, all the defendants except Mr. Futch were allowed to turn themselves in to the U.S. Marshal's Office Monday morning, as is typical in white collar criminal cases. However, for some reason, Mr. Futch was not allowed to do so and was arrested at his home as he was getting ready to take his two children to school. No word yet on the reason for the government's heavy handed handling of Mr. Futch.
The indictments follow a lengthy investigation into alleged efforts to manipulate the trading indexes, which are used to value billions of dollars in gas contracts and derivatives. Industry publications, such as the Inside FERC Gas Market Report, use data from traders to calculate the index price of natural gas. Accordingly, movement in index prices often affects the level of profits traders can generate. In these particular trader cases, it remains unclear whether the publication actually used the false information provided, but the government needs only to prove that fake trades were reported and not not that they were actually published or affected the markets.
Moreover, in an earlier case involving Ms. Valencia in which she was charged with false reporting, a federal district judge threw out the charges after ruling that the part of the Commodity Exchange Act that deals with reporting of false and misleading information on on commodity trades is unconstitutionally broad and vague. That ruling is currently on appeal at the Fifth Circuit Court of Appeals in New Orleans, which has already conducted oral argument in the case and is currently preparing its decision.
Posted by Tom at 7:13 PM | Comments (0) | TrackBack (0)
More on basketball, hockey style
On the heels of this earlier post on the fight that occurred on November 19 at the Pistons-Pacers game, do not miss Professor Sauer's analysis of the affair, with a Stros twist:
The Pacers' brawl is not the first instance of a fan being leveled by a player-thrown haymaker. In one memorable incident in 1999, a fan raced onto the field at Milwaukee County Stadium and jumped on Billy Spiers in right field. Spiers' Astros teamates were quick on the scene to defend him. I recall Mike Hampton landing a series of blows to the head of that bozo. Billy Spiers (a former Tiger in addition to being an Astro) was one of my favorite players. Put me in Hampton's shoes and I'd have done the same thing, though not so effectively. Thanks for that, Mike.Now, how different is Hampton's defense of his teammate from Jermaine O'Neal and Stephen Jackson's defense of Ron Artest? While there are differences, they are mostly a matter of degree. The common thread between the two incidents is the out of control fan.
Many issues are highlighted by the fight in Detroit. The NBA paid service to the media with swift and draconian punishment for the players involved. But to me, fan control is a more serious and more difficult problem than player control. Each time fans rush the court or the playing field after a game, they illustrate the raw power inherent in a crowd that no level of security short of an armored division can manage. The trick for sports management is to short-circuit the potential for a crowd to turn into a mob.
Definite clear thinking. Read the entire post.
Posted by Tom at 7:14 AM | Comments (0) | TrackBack (1)
Houston's bull on oil prices
This earlier post reported on an interview of Matt Simmons, the Houston-based investment banker who is an expert on forecasting oil supplies. Following that interview, this Barron's interview of Mr. Simmons warns that the Saudi oil supplies are not what they appear to be and that, because the Saudi oil industry is state-run, there is no independent auditor of national reserves who can verify just how large -- or small -- the Saudis' reserves are. As Mr. Simmons notes, that makes a big difference for the following reasons:
With global demand for oil on the rise, and prices hovering near $50 a barrel, the Saudis' production profile is more than academic. The No. 1 oil producer, Saudi Arabia pumps 13% of the world's oil and boasts 23% of its oil reserves. Moreover, the Saudis alone claim to have excess production capacity and the ability to increase output if demand continues to rise.
If the Saudis' numbers are correct, the kingdom could continue to produce at current levels of about 10 billion barrels a day for the next 50 years, or more. That would give the industrial world time to develop alternative energy sources and prepare for a graceful transition.
If Simmons is right, however, the world could face a dangerous imbalance between rising oil demand and diminishing supply, perhaps within the next 10 years. Oil prices could soar, economies could suffer, and oil-dependent nations, such as the U.S., China and Japan, would be forced to scramble for additional energy sources.
Matt Simmons' opinions are not to be taken lightly. Read the entire article.
Posted by Tom at 6:34 AM | Comments (0) | TrackBack (0)
November 28, 2004
2004 Weekly local football review
Texans 31 Titans 21. My younger son and I went to the Texans game today with a couple of friends and we all enjoyed an entertaining game. The Texans began the game in a coma and found themselves trailing 21-3 midway through the second quarter as Titans' QB Steve McNair sliced and diced the Texans' secondary. The Texans then pieced together their only drive of the first half to narrow the score to 21-10, but still looked overmatched as they could not stop McNair's pinpoint passing. Then, seemingly without reason, the Texans offense woke up in the third quarter, David Carr began to look like a top level NFL QB, and the Texans' defense started getting pressure on McNair. Before you knew it, the Texans had scored two TD's to take the lead 24-21. The remainder of the game pretty much involved the Texans playing it close to the vest on offense while defending furiously against the Titans' fourth quarter thrusts. Finally, a McNair fumble and interception in the fourth quarter thwarted the Titans' final drives, and then the Texans' Domanick Davis ran in a late TD from 41 yards to seal the victory for the hometown crew. The bottomline on this one was that the Texans' offensive line did a much better job of establishing a running attack for Davis and in protecting Carr, and that's the primary reason that the Texans (now 5-6 on the season) were able to beat the former Oilers for the second time this season. Next week's game for the Texans is at the Meadowlands against the Jets.
Dallas 21 Chicago 7. After a horrid first half display from both teams that almost set back NFL offenses from several decades of development, the Pokes' Vinnie Testaverde made the first of what will likely in coming weeks be several appearances in relief of current Cowboys savior Drew Henson and engineered two second half drives to secure the win for the Cowboys on Thanksgiving Day. Henson -- who curiously has gotten rich off of unrealized potential in both professional baseball and professional football -- stunk in his first start for the Pokes, going 4 of 12 for 31 yards with 1 interception that was run back 45 yards for a Chicago TD. Thus, in his first outing, Henson passed for more yardage and touchdowns to the other team than his own. The 4-7 Cowboys go to Seattle for the Monday Night game next week against the Seahawks. The Texans have a real chance of finishing this season with a better record than the Cowboys, which would not go over well with Pokes' owner Mr. Jones at Valley Ranch.
Texas Longhorns 26 Texas Aggies 13. In a game that was not as close as the score indicates, the Horns calmed down after a first half near-disaster to pound the Aggies into submission in the second half and come away with their fifth straight win in the storied series between the two programs. The Horns were about ready to take a 13-7 lead at the end of the first half when Texas QB Vince Young had a brain fart and fumbled the ball while attempting to stretch his arm over the goal line. Aggie safety Jonte Buhl picked up the fumble and raced 98 yards for an Aggie TD and a stunning 13-7 Aggie lead at halftime, which did not go over well with the Horns. That incident appeared to make the Longhorns downright ornery as the Horns' defense suffocated Aggie QB Reggie McNeal in the second half, holding the Aggie offense to a total of about 60 yards total offense. In one series during the fourth quarter, Texas took complete control of the line of scrimmage and sacked the elusive McNeal on three straight plays before the exasperated Aggie QB threw an interception on the fourth play. Meanwhile, Young and Cedric Benson kept pounding on the overworked Aggie defense and methodically scored 19 second half points to put the game away. The 10-1 Horns now await the outcome of the league championship games, but it is looking more and more like the best Texas team of the Mack Brown era will again miss out on a Bowl Championship Series game on New Year's Day. That's a shame, became this Horns team -- particularly its fast and strong defense -- is pretty darn good. The Aggies look like they are headed for the Holiday Bowl in San Diego against Arizona State for the Ags' first bowl game in three seasons.
Louisiana Tech 51 Rice 14. Rice's disappointing season ended on Monday night in a 51-14 loss to Louisiana Tech before a "crowd" of friends and family members of 8,317 at Reliant Stadium. The Owls finished with a record of 3-8 on the season.
The 3-8 Houston Cougars' season finished last week (mercifully).
And finally, don't miss Kevin Whited's final Big 12 wrap-up.
Posted by Tom at 6:49 PM | Comments (2) | TrackBack (0)
More on the wild world of Equatorial Guinea
The latest news from the wild world of Equatorial Guinea is not good for Mark Thatcher, the son of former English Prime Minister Margaret Thatcher. Here are the previous posts on this lurid affair. Movie rights to be sold soon.
Posted by Tom at 7:28 AM | Comments (0) | TrackBack (0)
UAL, we have a big problem
Most of news over the past two years about the United Airlines chapter 11 case has focused on the legacy airlines operating losses, its unfunded pension obligations, and its need to overhaul or reject its collective bargaining agreements. Here is a series of posts on those various issues.
So, United has established that a legacy airline can lose money for a long time while floundering in chapter 11. However, can United continue meandering in chapter 11 without aircraft? Look at this seemingly innocuous press release that United issued late this past Friday:
A U.S. federal bankruptcy court judge has blocked a group of creditors from repossessing up to 14 airplanes from UAL Corp.'s United Airlines, saving the bankrupt carrier tens of millions of dollars.Judge Eugene Wed off issued a temporary restraining order Friday barring the group, represented by the Chicago-based law firm Chapman & Cutler LLP, from seizing up to eight Boeing 767s and six 737s.
The group of financiers, which controls about one-third of United's fleet, had threatened to seize the planes as early as Dec. 1 because of an impasse over their leases.
United, the nation's No. 2 airline, is seeking to lower aircraft operating costs by renegotiating its leases with creditors. However, it argued that the Chapman group was violating antitrust laws by renegotiating as a bloc instead of as individual leaseholders, forcing United to accept higher lease rates.
Well, you say, what's so unusual about that? Secured creditors in chapter 11 cases are automatically stayed from repossessing their collateral until they petition the Bankruptcy Court to modify the automatic injunction under Bankruptcy Code section 362 to allow them to exercise their contractual rights. Isn't the Bankruptcy Judge simply enforcing the stay against United's aircraft lenders?
Not exactly. Aircraft collateral is treated differently under the Bankruptcy Code than other types of collateral (financial institutions that make aircraft loans lobby well in Congress). Under section 1110 of the Bankruptcy Code, the above-described TRO is on quite shaky grounds:
(a)(1) . . . , the right of a secured party with a security interest in [aircraft] equipment, . . . or of a lessor or conditional vendor of such equipment, to take possession of such equipment in compliance with a security agreement, lease, or conditional sale contract, and to enforce any of its other rights or remedies, under such security agreement, lease, or conditional sale contract, to sell, lease, or otherwise retain or dispose of such equipment, is not limited or otherwise affected by any other provision of this title or by any power of the court.
In plain English, that says "a bank that has aircraft collateral cannot be enjoined from repossessing and selling its collateral in a chapter 11 case." Section 1110 goes on to provide that the only limitation on an aircraft lender's collateral rights is during the first 60 days of the chapter 11 case and that the debtor must cure any defaults under its agreement with the aircraft lender if the debtor wants to continue using the aircraft that is collateral for the lender's loans to the debtor.
Consequently, it looks like the financial institutions that control a third of United's fleet have had enough. As United's management, unions, and other parties-in-interest continue to fiddle while Rome burns, I wonder whether they have examined pro formas on operating an airline without a substantial portion of its aircraft fleet? Inasmuch as the Bankruptcy Court's decision to approve a TRO in the face of section 1110 is almost certainly in error, United's dithering parties-in-interest better get ready to deal with a few less aircraft sooner rather than later.
Posted by Tom at 6:37 AM | Comments (0) | TrackBack (0)
November 27, 2004
Ken Lay's lawyer hammers the Chronicle and the Enron Task Force
The public relations contest that the Enron case has become continued today. In this Chronicle op-ed, Mike Ramsey -- former Enron chairman and CEO Kenneth Lay's criminal defense attorney -- levels a blast at the Chronicle for adhering to the government's witch hunt theme in regard to a recent Chronicle editorial critical of Linda Lay's involvement in the sale of a Lay Family charity's Enron stock days before the filing of Enron's bankruptcy case:
As the tabloids demonstrate, there is money to be made by jumping onto the popular side of a public frenzy. However, one can still hope that major newspapers will refuse to become mouthpieces for those who prefer strong-arm tactics to public trials.Just maybe it is time to get to the truth by a public trial instead of in the backrooms of the Enron Task Force and Houston Chronicle. (One might even wonder if those backrooms have adjoining doors.)
Then, Mr. Ramsey gives the Lay side of the story regarding the stock sale:
Linda Lay sold Enron shares as president of the family's charitable foundation. They were shares that Ken and Linda had given to that foundation prior to the end of 2000 and every penny of the money from the sale went to such charities as United Way, YMCA, DePelchin Children's Center, Star of Hope, Holocaust Museum Houston, and Open Door Mission, among many others.The sale was made on the day, Nov. 28, 2001, when the share price was in free-fall. Linda salvaged what she could, as was her duty as president of a charitable foundation. (The sale price was $2.37, off from a high near $85 earlier that year and a closing price the day before of $4.01.) More remarkable, during that market panic neither Ken nor Linda sold any of their personal shares.
Indeed, after Ken's return as CEO in August 2001 they held all their shares as the market plunged from near $40 per share to near $0.
The only shares that Ken and Linda ever sold during that tragic three and one-half months were sold to prevent margin calls from triggering a forced sale of all their shares. They never voluntarily sold a dime's worth after Ken's return. In fact, at bankruptcy they still held more than 1 million shares and more than 4 million vested stock options.
The dubious nature of the government's insider trading case against Mr. Lay has been examined in many previous posts here, including this one and this one. But Mr. Ramsey sees something far more sinister than a government investigation:
While it is true that Andrew Weissmann and his Enron Task Force have chosen not to comment publicly [on the investigation of Linda Lay's stock sale], I cannot accept that after nearly three years of investigation, the press and a secret grand jury happened, by coincidence, upon this particular event at the same time.Perhaps I am cynical, but this is not exactly my first rodeo.
No, there was a calculated leak done to produce an unfavorable story in aid of a shamefully false accusation.
Mr. Ramsey is undoubtedly correct that the Linda Lay story was a calculated leak by the government, and I am sympathetic to the argument that the prosecution has no business engaging in this type of public relations. However, the fact remains that Linda Lay's sale of this stock days before Enron's bankruptcy was a stupid move. Here's hoping that no lawyer advised her to do it.
Posted by Tom at 1:41 PM | Comments (0) | TrackBack (1)
Profiling radical Islamic fascists
Marc Sageman was a CIA case officer in Afghanistan between 1987–89 and is now a forensic psychiatrist in Philadelphia. His book, Understanding Terror Networks, was published by the University of Pennsylvania Press earlier this year.
After the attacks on New York and Washington of September 11, 2002, Dr. Sageman noticed the lack of systematic data on the perpetrators, so he began to apply the principles of evidence-based medicine to terrorism research. He gathered terrorist biographies from various sources, relying most heavily on the records of various criminal trials. After matrixing approximately 400 biographies, Dr. Sageman began a social-network analysis of this group.
This Foreign Policy Research Institute article provides a summary of Dr. Sageman's findings and conclusions. Inasmuch as the entire article is fascinating, I had a difficult time deciding which excerpts to pass along, but here are a few.
First, Dr. Sageman notes that the key period of development for the current radical Islamic fascists was the time in the late 1980's and early 1990's when their leadership gathered in Khartoum, Sudan to hatch their dream of indepedent "Salafi" states:
The Khartoum period is critical, because what these violent Salafists basically want to do is to create a Salafi state in a core Arab country. Salafi (from Salaf, “ancient ones” or “predecessors” in Arabic) is an emulation, an imitation of the mythical Muslim community that existed at the time of Mohammed and his companion, which Salafists believe was the only fair and just society that ever existed. A very small subset of Salafis, the disciples of Qutb, believe they cannot create this state peacefully through the ballot-box but have to use violence. The utopia they strive for is similar to most utopias in European thought of the nineteenth to the twentieth centuries, such as the communist classless society.
Moreover, Dr. Sageman points out that the background of the radical Islamic fascist leadership is similar to that of the "best and the brightest" of the societies from which they have emerged:
Most people think that terrorism comes from poverty, broken families, ignorance, immaturity, lack of family or occupational responsibilities, weak minds susceptible to brainwashing - the sociopath, the criminals, the religious fanatic, or, in this country, some believe they’re just plain evil.Taking these perceived root causes in turn, three quarters of my sample came from the upper or middle class. The vast majority—90 percent—came from caring, intact families. Sixty-three percent had gone to college, as compared with the 5-6 percent that’s usual for the third world. These are the best and brightest of their societies in many ways.
Al Qaeda’s members are not the Palestinian fourteen-year- olds we see on the news, but join the jihad at the average age of 26. Three-quarters were professionals or semi- professionals. They are engineers, architects, and civil engineers, mostly scientists. Very few humanities are represented, and quite surprisingly very few had any background in religion. The natural sciences predominate. Bin Laden himself is a civil engineer, Zawahiri is a physician, Mohammed Atta was, of course, an architect; and a few members are military, such as Mohammed Ibrahim Makawi, who is supposedly the head of the military committee.
Mr. Sageman notes that there really is not one profile for a radical Islamic fascist:
So what’s in common? There’s really no profile, just similar trajectories to joining the jihad and that most of these men were upwardly and geographically mobile. Because they were the best and brightest, they were sent abroad to study. They came from moderately religious, caring, middle-class families. They’re skilled in computer technology. They spoke three, four, five, six languages. Most Americans don’t know Arabic; these men know two or three Western languages: German, French, English.When they became homesick, they did what anyone would and tried to congregate with people like themselves, whom they would find at mosques. So they drifted towards the mosque, not because they were religious, but because they were seeking friends. They moved in together in apartments, in order to share the rent and also to eat together - they were mostly halal, those who observed the Muslim dietary laws, similar in some respects to the kosher laws of Judaism. Some argue that such laws help to bind a group together since observing them is something very difficult and more easily done in a group. A micro-culture develops that strengthens and absorbs the participants as a unit. This is a halal theory of terrorism, if you like.
These cliques, often in the vicinity of mosques that had a militant script advocating violence to overthrow the corrupt regimes, transformed alienated young Muslims into terrorists. It’s all really group dynamics. You cannot understand the 9/11 type of terrorism from individual characteristics. The suicide bombers in Spain are another perfect example. Seven terrorists sharing an apartment and one saying “Tonight we’re all going to go, guys.” You can’t betray your friends, and so you go along. Individually, they probably would not have done it.
In fact, the lack of these social networks is one of the reasons why Dr. Sageman believes that another 9/11-type attack has not occurred in the United States:
Indeed, there are not that many terrorists in America. There have never been any sleeper cells. All the terrorists are fairly obvious. The FBI cases we see in the press tend to unravel. The Detroit group has been exonerated, and the prosecutor is now being prosecuted for malfeasance on the planted evidence. He allegedly knew exculpatory facts that he did not present to the defense. The only sleeper America has ever had in a century was Soviet Col. Rudolf Abel, who was arrested in the late 1950s and exchanged for Gary Powers, the U2 pilot. Eastern European countries did send sleepers to this country, men fully trained who “go to sleep”—lead normal lives—and then are activated to become fully operational. But they all became Americans.In order to really sustain your motivation to do terrorism, you need the reinforcement of group dynamics. You need reinforcement from your family, your friends. This social movement was dependent on volunteers, and there are huge gaps worldwide on those volunteers. One of the gaps is the United States. This is one of two reasons we have not had a major terrorist operation in the United States since 9/11. The other is that we are far more vigilant. We have actually made coming to the U.S. far more difficult for potential terrorists since 2001.
But Dr. Sageman warns that the radical Islamic fascists have adapted and changed the way in which they will plan future attacks:
We hear that Al Qaeda plans its attacks for years and years. It may have before 9-11, but not anymore. Operatives in caves simply cannot communicate with people in the field. The network has been fairly well broken by our intelligence services. The network is now self-organized from the bottom up, and is very decentralized. With local initiative and flexibility, it’s very robust. True, two-thirds to three- quarters of the old leaders have been taken out, but that doesn’t mean that we’re home free. The network grows organically, like the Internet. We couldn’t have identified the Madrid culprits, because we wouldn’t have known of them until the first bomb exploded.So in 2004, Al Qaeda has new leadership. In a way today’s operatives are far more aggressive and senseless than the earlier leaders. The whole network is held together by the vision of creating the Salafi state. A fuzzy, idea-based network really requires an idea-based solution. The war of ideas is very important and this is one we haven’t really started to engage yet.
Posted by Tom at 10:26 AM | Comments (3) | TrackBack (0)
"Alexander the Turkey"
My younger son, who is a serious film buff, went to see Oliver Stone's Alexander the Great yesterday. He passes along that it is an unmitigated disaster, and predicts that it will be out of the theaters in less than a month, a prediction that is supported by the woeful early financial performance of the $210 million film (there were few people in the audience of the showing that he attended). The Washington Post's Stephen Hunter agrees in this hilarious review, and passes along this gem on the performance of Angelina Jolie as Alexander's mother, Olympias:
Then there's Angelina Jolie as Mom. Really, words fail me here. But let's try: Give this young woman the hands-down award for best impression of Bela Lugosi while hampered by a 38-inch bust line. Though everyone else in the picture speaks in some variation of a British accent, poor Jolie has been given the Transylvanian throat-sucker's throaty, sibilant vowels, as well as a wardrobe of snakes. She represents the spirit of kitsch that fills the movie, and with all her crazed posturing and slinking, it's more of a silent movie performance than one from the sound era. Theda Bara, call your agent.
The blogosphere's foremost film critic -- Professor Ribstein -- passes along his thoughts in this post. And even Victor Davis Hanson chimes in with this review, in which he concludes:
There is also irony here. If we remember the embarrassing Troy, we are beginning to see, that all for all the protestations of artistic excellence and craftsmanship, Hollywood has become mostly a place of mediocrity, talentless actors and writers who spout off about politics in lieu of having any real accomplishment in their own field. I’ve heard so many inane things mouthed by Stone that I would like someone at last to address this question—why would supposedly smart insiders turn over $160 million to someone of such meager talent to make such an embarrassing film? Alexander the Great is third-rate Cecil B. Demille in drag.
Posted by Tom at 9:06 AM | Comments (0) | TrackBack (0)
For Seinfeld fans
The Chronicle's Ken Hoffman will like this -- The Jerry Seinfeld Dictionary of Terms and Phrases. An example:
Must-Lie Situation - when a person feels that they cannot tell the truth to someone else for fear of offending them (ex #1 calling one's baby "Breathtaking", ex #2 not being able to tell someone that their hairdo is pre-1960's or just plain hideous)
Posted by Tom at 8:25 AM | Comments (0) | TrackBack (0)
November 26, 2004
The politics of statutes at UT
This NY Times article reports on the squabble that has arisen over the University of Texas at Austin's decision to honor famed Houston trial lawyer Joe Jamail with his second statute on the UT campus:
Of the more than a dozen statues peppering the University of Texas campus here, one glorifies the first native-born governor, two pay tribute to deceased American presidents, and others honor Confederate leaders.Another statue is poised to join the cast on Friday, honoring a graduate who is a successful trial lawyer.
The subject, Joe Jamail, a Houston alumnus who has donated $21.7 million to the university and its athletic programs, already has one bronze likeness at the law school and his name is on several campus sites. The newest statue of Mr. Jamail, who won billions of dollars for Pennzoil in a landmark suit in the 1980's, is scheduled to be unveiled inside the football stadium before the annual game against archrival Texas A&M.
But not everyone looks forward to another likeness. The statue, . . makes Mr. Jamail the only person with two on the 350-acre campus, university officials say, and that distinction has rankled some faculty members.
"One is enough, with due respect to whoever," said a journalism professor, Gene Burd.
The 78 year old Jamail is most famous (notorious?) for persuading a Houston state court jury in 1985 to award a record $11 billion in damages against Texaco for tortiously interfering with Pennzoil's attempted acquisition of Getty Oil. The subsequent judgment prompted Texaco to file a chapter 11 case, which eventually resulted in a settlement of Pennzoil's claim for $3 billion in 1987. Already a wealthy plaintiff's lawyer, Mr. Jamail took the case on a contingency fee, so his piece of the settlement made him one of the wealthiest attorneys in the world.
Over the past 20 years, Mr. Jamail has become a philanthropist, and UT has been the main beneficiary of his philanthropy. Sites at the university named for Mr. Jamail include the swim center, the football field, the law school pavilion that contains the first statute of him, and the law school's legal research center. The newest statue of Mr. Jamail planned for a corner of the football stadium will be placed near a new statue of the former national champion football coach and UT legend Darrell Royal. By the way, Mr. Jamail paid for the statute of Coach Royal.
To this day, the Pennzoil-Texaco case is most remembered in Houston legal circles for the catastrophic trial decision that Texaco's general counsel made. Texaco's main defense was that it was justified in competing with Pennzoil for Getty Oil and, thus, could not have tortiously interfered with Pennzoil's takeover attempt. However, in support of an alternative defense, Texaco's trial counsel recommended that Texaco put on expert testimony that would contradict Pennzoil's evidence of alleged damages. Texaco's general counsel decided that putting on countervailing damages testimony would be a signal to the jury that Texaco did not confidence in its primary defense, so he directed Texaco's trial counsel not to put on any expert damages testimony.
Consequently, when the jury found in favor of Pennzoil on the liability issue, the only damages evidence in the trial record was Pennzoil's. Thus, the $11 billion jury verdict ensued, and the trial record contained inadequate evidence upon which an appellate court could base a decision to reduce the damages.
As they say in defense circles, "Ouch!"
Posted by Tom at 7:35 AM | Comments (1) | TrackBack (0)
Oh great! Cell phone viruses?
Your cell phone may be the victim of the next wave of viruses.
Posted by Tom at 7:03 AM | Comments (2) | TrackBack (0)
Krispy Kreme = Boston Market
This Floyd Norris' NY Times column does a nice job of explaining the developing debacle of Krispy Kreme, the share price of which peaked at $49.74 in the summer of 2003, but which has fallen as low as $9.35 recently. An earlier post on the company's developing troubles may be reviewed here.
What happened? Easy. Most Krispy Kreme franchises don't make money:
Krispy Kreme's company-owned stores report an operating profit, but not one large enough to cover corporate overhead. The real profits have come from the company's dealings with its franchise vendors. The franchises pay royalties of 4.5 percent to 6 percent of sales, plus 1 percent for advertising and public relations. And they must buy all their supplies from the parent - paying hefty markups that provide 20 percent profit margins for Krispy Kreme.All that would be fine if the franchises were doing well. But many are not, and some are turning to Krispy Kreme as the lender of last resort. Some of these borrow from the parent and others sell their franchises back to it. One lucky operator had a deal that forced Krispy Kreme to buy at a price set in more optimistic times. In other cases, the parent bought for reasons the S.E.C. may be looking into, since its insiders held stakes in franchises the company purchased.
Until recently, it had been hard to tell how the franchises were doing. But the combination of additional investments in franchises and new accounting rules - imposed as a result of the Enron scandal - has forced the company to disclose more. In the quarter ended in October, the joint ventures lost $2.1 million after coming close to breaking even a year earlier.
The lesson of Krispy Kreme is simple, and it is the same one that the Boston Market bankruptcy of the 1990's should have taught us. If the people who actually sell the product are not doing well, then neither is the enterprise.
Put Krispy Kreme on your bankruptcy watch list for 2005.
Posted by Tom at 6:35 AM | Comments (0) | TrackBack (0)
United finally seeks to reject CBA's
Two years into its aimless chapter 11 case, UAL Corp. finally requested that the Bankruptcy Court allow it to reject its existing labor contracts with six unions if the company cannot reach consensual agreements on modifications to the contracts by January, 2005.
Better late than never, but geez United, let's get on with it.
In its motion, United disclosed that it needs an additional $725 million in annual savings from its 62,000 workers in order to maintain sufficient liquidity to avoid a default under its interim bankruptcy financing even though United employees provided wage cuts valued at $2.5 billion a year earlier in the case. United now needs to generate additional savings because the airline business has been hammered even further by a compbination of low ticket prices, competition from discount airlines, high fuel prices, and unfunded pension obligations.
Moreover, UAL used the filing to remind the Court that it must also reduce its pension liabilities in order to secure exit financing to fund a plan of reorganization in its chapter 11 case. Consequently, unless consensual modifications of those liabilities are obtained, United will request that the Court approve United's termination of its four pension plans, which would foist a substantial portion of the unfuned pension liabilities onto the federal Pension Benefit Guaranty Corp., which is not exactly in great shape itself.
United's proposals are meeting with angry opposition in its chapter 11 case from the various unions and the PBGC. As a result, it appears that United will probably be required to endure a prolonged court battle on its motion to reject the labor contracts. Under the Bankruptcy Code, United has to prove that the rejections are necessary to permit the company to reorganize, that they are fair, and that the company bargained in good faith with the unions.
Legacy airlines are doomed to failure in the current airline industry absent change that will allow them to compete with the discount airlines. Nevetheless, the glacial progress in United's chapter 11 case reflects the difficulties involved in changing a legacy airline's culture. Although perhaps not best for United and its various parties-in-interest, the best thing that could happen to the airline industry as a whole would be for the Bankruptcy Judge in United's case to issue an order requiring United's parties-in-interest to show cause why United should not be liquidated. Only that type of industry shattering event is likely to shake the intractable view of airline unions that the past largesse of the legacy airlines is sustainable in the future.
Meanwhile, in this Wall Street Journal ($) op-ed, three authors involved in airline industry/bankruptcy issues provide the following proposal for dealing with unfunded pension obligations of the various legacy airlines:
We believe that the airlines, airline unions and the administration should work together to propose to the Congress a new alternative to the "lose-lose-lose" Chapter 11 approach. This would present an airline and unions with the following new choice: First, management and a union would need to agree collectively to freeze an existing defined-benefit pension plan. Importantly for the PBGC, its liability as guarantor of the plan would be capped as of the freeze date and would decrease over time. Second, the unfunded liability of the frozen plan then would be amortized over a specified time period that would be longer than what current law allows. Here's where compromise is needed -- the PBGC will want a shorter period for the unfunded pension liability to be paid; the airlines will want longer. One thing is clear: The existing pension funding law, particularly the so-called deficit-reduction contribution provisions, so accelerate the funding of significantly underfunded pension plans as to make the freeze option unrealistic absent a longer time period to satisfy the unfunded liabilities. Finally, management and labor would negotiate and agree upon a new, replacement defined-contribution pension plan.
Posted by Tom at 5:21 AM | Comments (0) | TrackBack (0)
November 25, 2004
Rathergate is rather fine for CBS
This NY Times article reports that CBS executives are smiling these days, and Dan Rather's recent resignation as CBS anchorman does not really have much to do with it.
This is further confirmation that the mainstream television networks are really just entertainment venues, and that their news divisions have turned into just another entertainment show that they feel compelled to run for public relations purposes. Thus, so long as the news divisions are marginally profitable or do not lose much money, the networks don't really care much about the quality of the product.
My sense is that this is not the way that Edward R. Murrow thought that television network news was going to develop.
Meanwhile, this editorial provides The Economist's view of Mr. Rather's resignation, including the following observation:
Mr Rather's retirement epitomises two broader shifts of power. First, the old media are losing power to the new. And, second, the liberal media establishment is losing power to a more diverse cacophony of new voices.
Posted by Tom at 8:41 AM | Comments (0) | TrackBack (0)
Spreading Holiday Cheer through Amazon
If you, like me, purchase a boatload of holiday gifts through Amazon.com, then you can help support this blog by clicking the "Holiday Shopping @ Amazon" link on the right side scroll bar. At no additional cost to the purchaser, Amazon's Associates program pays a small commission to this blog for any items purchased while accessing Amazon through that link. A number of other fine blogs are also in the program, (Virginia Postrel and Marginal Revolution to name just two), so I encourage you to use Amazon by clicking such a link and help support your favorite blogs during this Holiday Season. Thanks!
Posted by Tom at 8:16 AM | Comments (0) | TrackBack (0)
Bill Moyers is retiring
Bill Moyers will retire next month from full-time broadcasting at the age of 70. This Rocky Mount Telegram article explores the life and work of Mr. Moyers, who has been one of the most thoughtful journalists regarding public affairs during his long career in journalism. Raised in Marshall, Texas, Mr. Moyers met Lyndon Johnson during his 1954 Senate campaign and then served as deputy director of the Peace Corps under President Kennedy and as President Johnson's chief advocate for the Great Society and the War Against Poverty from 1963-67.
Although I have not always agreed with Mr. Moyers' views, I have always appreciated the thoughtful manner in which he has presented them. During these times of increasingly polarized views, such an advocate of reasoned debate will be missed.
Posted by Tom at 7:47 AM | Comments (0) | TrackBack (0)
November 24, 2004
Is the Disney trial a precursor for change in corporate governance?
Don't miss Professor Ribstein's post about the ongoing trial over the Walt Disney Co. board's decision to pay Michael Ovitz a rather generous severance package for essentially doing nothing during his short stay at Disney.
The trial is an interesting one because it combines Hollywood largesse with knotty issues of corporate law, such as the limits of judicial supervision over the business judgment rule. However, Professor Ribstein wonders whether something even more basic is unfolding:
But I wonder whether something more basic is at stake -- the future of the corporate enterprise as we know it. After all that we have seen in the last few years, can we really be optimistic that things are changing?
He goes on to point out that Disney could well be the product of an obsolescent business model:
Think about this in the Disney context. Why do we need this Disney behemoth? The brand? Synergy? Michael Powell recently wondered "if Walt Disney would be proud," speculating on the disastrous cross-promotion of Disney's Desperate Housewives on Disney's Monday night football. Does this sort of thing make people want to go into Disney's family-oriented amusement parks? Even the film business has gotten away from the Disney brand -- Pixar was providing the meat until Eisner chased it away.
Professor Ribstein points out that there is a better way:
I've argued in Why Corporations? for the dismantling of the corporate entity and the greater use of partnership-type forms for publicly held business. This could be spurred by a change in the tax laws that puts more emphasis on distribution rather than retention of earnings.
How about spinning the amusement parks into a real estate limited partnership, divesting the television properties, and focusing on the movie business? Aside from giving Eisner less to play with over his remaining two years, what would be lost?
In short, the Disney Board's foible of approving the Ovitz severance package pales in comparison to its failure to require Michael Eisner to adapt Disney's corporate strategy to maximize value for Disney's shareholders. This is true clear thinking, so check out the entire post.
Posted by Tom at 7:06 AM | Comments (0) | TrackBack (1)
The political landscape for tax reform
This Washington Post article does a good job of describing the political landscape that confronts the Bush Administration in proposing and enacting tax reform legislation. The sponsors of the 1986 Tax Reform legislation -- Dan Rostenkowski and Robert Packwood -- are not particularly optimistic that the administration's approach to the issue will result in successful reform. Check it out.
Posted by Tom at 6:51 AM | Comments (0) | TrackBack (0)
The real Oskar Schindler
This NY Times book review examines Holocaust historian David M. Crowe's authoritative new biography of Oskar Schindler, the German businessman who saved more than 1,000 Jews from the Nazis during World War II.
Interestingly, Mr. Crowe's book -- Oskar Schindler: The Untold Account of His Life, Wartime Activities and the True Story Behind the List (Westview Press 2004) -- differs sharply with the idealized portrayal of Schindler in the Oscar-winning 1993 Steven Spielberg movie Schindler's List and Thomas Keneally's 1982 historical novel that inspired the movie.
One of the particularly interesting differences between the book and the movie is how Schindler's Jewish workers are depicted as Schindler prepares to flee in the face of the Russian invaders. In the movie, the Jews are depicted as worn down and overwhelmed. Mr. Crowe contends that the Schindler had in fact prepared the Jews to be "an armed guerilla group. "They were armed to the teeth, ready to fight till the death."
Posted by Tom at 6:24 AM | Comments (0) | TrackBack (0)
An annuity for auditors
Don't miss Holman Jenkins, Jr.'s Business World column this week in the Wall Street Journal ($) in which he reviews the rather remarkable effects of the Sarbanes-Oxley legislation, which was Congress' knee-jerk public relations reaction to the WorldCom and Enron scandals:
No wonder that the annual bill for Sarbox is going through the roof, with the latest estimates being about $6 billion for the Fortune 1000 alone. One investment banker estimates that a small company nowadays would have to generate $150,000 in free cash annually just to cover the additional paperwork before it can even consider going public. Then there's upwards of $100,000 each to insure all who sit on its board, if any can be found. Oh yes, and the fact that audit fees, for the average company, have risen about 50% in a single year.No wonder, too, that the number of companies alerting the SEC that their latest financial reports will be late doubled last quarter, adding to a backlog of late filers that recently topped 600. One strategic-investor type who sits on the boards of a number of companies called a few weeks back to gripe in detail about what all this was costing the economy. Under the SOX regime, something as slight as an anonymous letter alleging accounting irregularities can effectively deliver a company entirely into the control of outside auditors. Directors, so fearful about their own liability that they stop thinking about what's good for the business and worry only about securing their own alibis, write a blank check with shareholders' money to do whatever the auditor dictates.
And though Sarbox compliance has become a gravy train for auditors, Mr. Jenkins points out that it has come with a "Faustian Caboose:"
But, ahem, Sarbanes-Oxley has at least fixed a lot of real problems, right? Let's recall that the Internet and telecom bubbles were occasioned by investors who weren't interested in published financial accounts -- they were interested in the speculative potential of new technologies and new business models.Secondly, there was the problem of how company promoters and CEOs behaved in the presence of a stock market willing to throw money at such speculative endeavors. Neither of these issues is addressed by Sarbanes-Oxley. Nor does any legislative solution for the inherent risks and foibles of market capitalism suggest itself.
Sarbox, rather, is the last gasp of a corporate governance kludge in which auditors became, in the public's eye, something they've never been in their own eyes: namely proof against fraud. In the audit industry's eyes (or at least in its behavior), the mandatory audit is a welcome gravy train that has gradually revealed an unwelcome Faustian caboose. Whenever a company blows itself up in an accounting scandal, the accountants pay for their gravy train by serving as an additional set of deep pockets for trial lawyers to sue.
So rather than encouraging beneficial risk taking that spurs economic development and job creation, Congress gives us Sarbones-Oxley, which is nothing more than a regulatory straightjacket that could well chill markets in the long run. This is a common occurrence when our elected officials pass legislation to facilitate public relations for their re-election campaigns rather than to provide a real benefit for their constituents.
Posted by Tom at 5:40 AM | Comments (0) | TrackBack (0)
Car line terror
My wife has spent a fair amount of time in school car lines over the years, and she passes along the result of this serious breach of car line etiquette reported by the Chronicle:
A spat that started almost a year ago, in the line to pick up children after classes at the Village School, will move into a Houston municipal court today as a 40-year-old mother faces a misdemeanor assault charge.Sandra Chiang denies reaching into Shannon Rechter's sport utility vehicle and slapping her in the face afterRechter cut in line while other parents were waiting and chatting outside the school. Chiang could be fined up to $500 if convicted.
The incident ignited a yearlong feud that has included the assault charge, a counterclaim of vandalism, allegations of harassment and the removal of Rechter's two children from the school.
The two stay-at-home mothers had never met before Dec. 13, 2003, when Chiang left her car idling as the carpool line moved forward, and Rechter, 38, wedged into the space ahead of her.
"She immediately began yelling at me for cutting in line, and the more I tried to explain the madder she became," Rech-ter said.
"At that point, she reached in, struck me across the face and quickly ran back to her car as if nothing happened."
Chiang contends that her SUV was "keyed" by Rechter several weeks later. The hood and a door were scraped, causing an estimated $1,600 in damage, she says.
For some reason, the case is not high on the radar screen of the Harris County District Attorney's Office:
Rechter says school officials and law enforcement authorities didn't take her seriously when she first reported the incident.It took numerous calls to police and the city prosecutor's office to get the case scheduled for trial, she says.
My wife's question: If I was defending this case, would I try to strike for cause anyone on the jury panel who regularly has to sit in a car line?
My answer: Only if they don't cut in line. ;^)
Posted by Tom at 5:13 AM | Comments (0) | TrackBack (0)
November 23, 2004
Unleashing the power of markets in health care
Regular readers of this blog know of my skepticism that the costs attributable to America's reliance on third party payors in its health care finance system are commensurate with the benefits of paying for medical service in that fashion.
Following up on that thought, Alex Tabarrok over at Marginal Revolution notes in this post that one of the most popular types of medical procedure has declined in cost recently precisely because it is not generally covered under America's third party payor system:
Everywhere we look it seems that health care is more expensive: prescription drug prices are increasing, costs to visit the doctor are up, the price of health insurance is rising. But look closer, even closer, closer still. Don't see it yet? Perhaps you should have your eyes corrected at a Lasik vision center.Laser eye surgery has the highest patient satisfaction ratings of any surgery, it has been performed more than 3 million times in the past decade, it is new, it is high-tech, it has gotten better over time and... laser eye surgery has fallen in price. In 1998 the average price of laser eye surgery was about $2200 per eye. Today the average price is $1350, that's a decline of 38 percent in nominal terms and slightly more than that after taking into account inflation.
Why the price decline in this market and not others? Could it have something to do with the fact that laser eye surgery is not covered by insurance, not covered by Medicaid or Medicare, and not heavily regulated? Laser eye surgery is one of the few health procedures sold in a free market with price advertising, competition and consumer driven purchases. I'm seeing things more clearly already.
Touche!
Posted by Tom at 8:22 AM | Comments (12) | TrackBack (0)
A new form of business regulation
Don't miss George Mason University law and economics whiz Henry G. Manne's brilliant Wall Street Journal ($) op-ed from yesterday in which he criticizes Eliot Spitzer's latest assault on business. Dean Manne cuts through the fog of Spitzer's public relations blitz to bear in on the true nature of Spitzer's campaign against the big insurers:
In an era of general acceptance of deregulation and privatization, Mr. Spitzer has introduced the world to yet a new form of regulation, the use of the criminal law as an in terrorem weapon to force acceptance of industry-wide regulations. These rules are not vetted through normal authoritative channels, are not reviewable by any administrative process, and are not subject to even the minimal due-process requirements our courts require for normal administrative rule making. The whole process bears no resemblance to a rule of law; it is a reign of force. And to make matters worse, the regulatory remedies are usually vastly more costly to the public than the alleged evils.
Professor Manne goes on to point out that Marsh's contingent commissions were as innocent as payola, which is widely misunderstood with regard to its market effect:
Nobel Laureate Ronald Coase once famously showed (Journal of Law and Economics 1979) how kickbacks in the so-called radio DJ payola scandal were really a legitimate, albeit superficially confusing, competitive device. Payola was essential, Coase explained, to preserving competition between record companies, and its demise was only sought by competitors who were injured by the practice -- not by consumers. There are eerie similarities between the two situations.If the Coasian analysis is correct -- and no serious rebuttal has ever appeared -- we may witness the demise of specialized insurance-brokerage firms like Marsh & McLennan in favor of more integrated insurance companies who will do their own marketing. This is already rumored to have begun. Or we may see insurance brokerage firms beginning to acquire and operate insurance companies. In either case we would be witnessing a decrease in market specialization with a commensurate loss of economic efficiency. Mr. Spitzer would have succeeded in making the industry less competitive and less efficient, and insurance buyers will eventually pay higher not lower premiums.
With his usual insight, Professor Ribstein succiently points out in this post that governmental regulation of payola is misguided because of the valuable market benefits that it provides:
The problem is that, whenever government interferes with the market, it can create more problems than it solves. When government banned payola . . , it blocked a practice that was, after all, getting more air time for new kinds of music. (In general, regulation hurts the newcomers more than it hurts the established players.) But it didn’t stop payola. . . .“[N]ew payola” (spot buys) arose in response to the banning of the old payola. The new payola, . . . creates a less informed market than the old payola.
Payola's effect in making the music market less transparent is analogous to the effect of insider trading regulation. Insider trading, like payola, helps disseminate information. Regulation forces the trading underground, making markets less informed.
The criminalization of business practices exemplified by Spitzer's tactics and most of the Enron-type prosecutions combines the worst elements of business regulation with overt miscarriages of justice. Although the prosecutions play well as superficial morality plays in the mainstream media, I fear that the damage being done to America's business and justice systems will ultimately exceed even the tragic destruction of individual lives that has, and will continue, to occur.
Posted by Tom at 7:22 AM | Comments (0) | TrackBack (0)
The theological dilemma of moderate Islam
In this Asia Times op-ed from the Asia Times, Spengler explores the the theological challege that moderate Muslims face in siding with the West in its war against the radical Islamic fascists. The entire piece is a must read, but this excerpt gives you a taste of the dilemma that moderate Muslims face:
Smugness oozes from European politicians who demand that Muslims repudiate violence as a precondition for residence in the West. To repudiate the death sentence for blasphemy would be the same as abandoning the Islamic order in traditional society in favor of a Western-style religion of personal conscience. The West spent centuries of time and rivers of blood to make such a transition, and carried it off badly. Whether Islam can do so at all remains doubtful.
Posted by Tom at 7:11 AM | Comments (0) | TrackBack (0)
Benihana killer shrimp
This New York Law Journal article reports on the wrongful death case against Benihana that grew out of a customer's reaction to a chef's playful toss of a shrimp:
A piece of grilled shrimp flung playfully by a Japanese hibachi chef toward a tableside diner is being blamed for causing the man's death.Making a proximate-cause argument, the lawyer for the deceased man's estate has alleged that the man's reflexive response -- to duck away from the flying food -- caused a neck injury that required surgery.
Complications from that first operation necessitated a second procedure. Five months later, [the customer] was dead of an illness that his family claims was proximately caused by the injury.
What a way to go.
Posted by Tom at 6:58 AM | Comments (0) | TrackBack (0)
The Heisman Trophy winning faith healer
This Austin American-Stateman article reports on the latest undertakings of former University of Texas Heisman Trophy and NFL running back Ricky Williams. The quixotic Mr. Williams -- who retired from the NFL earlier this year at the relatively young age of 27 -- is now training to be a faith healer:
Williams has turned up about as far from professional football as you can get, as a student of the ancient Indian medical system known as Ayurveda. In the Sierra foothills, no less."I realized a while back that I have an innate ability to be compassionate," he said, "and I saw that the strength of compassion is something that healers have and healers use."
Williams is now a month into a 17-month course at the California College of Ayurveda (pronounced I-yur-vay-da) in Grass Valley, a city of 12,000 about 45 miles northeast of Sacramento. He's renting a one-bedroom cottage in nearby Nevada City.
Reluctant at first to talk, [Williams] soon started describing his old life in football and his new life in holistic healing."Ayurveda deals with using your environment to put yourself in balance," he said. "I've realized, both on a psychological and physical level, that the things we do in football don't bring more harmony to your life. They just bring more disharmony."
Is he happier now that he's removed from the game?"I'm closer to being happy. I'm doing things that make me happy," Williams said. "In football I loved to practice and I loved to play, but I hated to be in meetings, hated to talk to the media, hated to have cameras in my face, hated to sign autographs. I hated to do all those things."
But then Ricky -- how do you explain this?
Earth to Ricky, over and out.
Posted by Tom at 6:26 AM | Comments (3) | TrackBack (0)
Political hack alert
This earlier post noted that the brewing controversy in Dallas over the Wright Amendment provides a ripe field for politicians to reap financial windfalls so long as they are willing to make bad policy decisions that favor certain private business interests.
It appears that their is an inexhaustible supply of issues in which politicians can parley the sale of their political soul into a nice financial return for their campaign war chests. This Wall Street Journal ($) article reports that telecom companies are lobbying elected officials around the country to rationalize support for legislation that restricts free or inexpensive WiFi service for their constituents:
Dozens of cities and towns across the country are rushing to provide low- or no-cost wireless Internet access to their residents, but the large phone and cable companies, fearful of losing a lucrative market, are fighting back by pushing states to pass legislation that could make it illegal for municipalities to offer the service.
Philadelphia announced during the summer that it would hook up the entire city with Wi-Fi. Its current Wi-Fi service is free, but it hasn't decided whether that would continue with wider deployment; it may charge a small fee. "There are some very specific goals that the city has that are not met by the private sector: affordable, universal access and the digital divide," says Dianah Neff, the city's chief information officer. She says that less than 60% of the city's neighborhoods have broadband access.However, last week, after intensive lobbying by Verizon Communications Inc., the Pennsylvania General Assembly passed a bill with a deeply buried provision that would make it illegal for any "political subdivision" to provide to the public "for any compensation any telecommunications services, including advanced and broadband services within the service territory of a local exchange telecommunications company operating under a network-modernization plan." Verizon is the local exchange telecommunications company for most of Pennsylvania, and it is planning to modernize the region using high-speed fiber-optic cable. The bill has 10 days for the governor to sign it or veto it.
The Pennsylvania bill follows similar legislative efforts earlier this year by telephone companies in Utah, Louisiana and Florida to prevent municipalities from offering telecommunications services, which could include fiber and Wi-Fi.
Rather than encouraging municipalities to provide free or inexpensive broadband internet access for its citizens, telecom companies argue that legislators should be more concerned with protecting the telecom companies from competing with local governments to provide WiFi service. Even such palpably superficial reasoning is resonating with Pennsylvania legislators, who apparently need to replenish their campaign war chests:
The Pennsylvania bill, first introduced in 2003, was passed by the state Senate late Thursday night and then passed for a second time by the state House of Representatives late Friday night by wide margins. Senate supporters agreed with Verizon's view of the legislation. Don Houser, a spokesman for Senator Jake Corman, the Senate sponsor of the bill, said "the thinking was the telephone companies didn't want to have local municipalities using tax dollars to compete with private dollars."
Well, citizens are perfectly capable of replacing their elected officials if they do not want their local municipalities competing with private business in providing WiFi service. Pennsylvania Gov. Edward G. Rendell has until November 30 to act on this legislation and has not yet declared which route he will choose. It's not a close cal that he should reject the legislation, but money talks in politics and the telecome companies are willing to throw it around. Keep an eye on this one.
By the way, have you noticed that elected officials do not seem to mind having government compete with private financiers in connection with providing governmental financing for a new stadium?
Posted by Tom at 5:30 AM | Comments (0) | TrackBack (0)
November 22, 2004
James A. Baker, III gets results
This NY Times article reports on the agreement of The world's leading industrial nations to cancel 80 percent of the nearly $40 billion of debt that Iraq owes them, which is a critical step in rebuilding the country's devastated economy and an important precedent for placing pressure on Saudi Arabia, Kuwait and Iraq's other Middle Eastern neighbors to forgive Iraq's obligations owed to them.
Longtime Houstonian and former Secretary of both the State and Treasury Departments, James Baker III, who President Bush appointed last year as a special envoy to press Iraq's creditors to write off money owed them, toured the world over the past year persuading various foreign governments to sign on to the debt forgiveness plan. Kudos to Mr. Baker for a job well done.
Posted by Tom at 6:43 AM | Comments (1) | TrackBack (0)
2004 Weekly local football review
Packers 16 Texans 13. On ESPN Sunday Night Football, the Pack handed the increasingly hapless Texans their third straight loss on a last second field goal despite the fact that they were down to their third string running back and could do nothing but pass. As usual, the Texans could not mount a pass rush, so Brett Favre methodically drove the Packers to 13 fourth quarter points to overcome a 10 point Texans' lead. Meanwhile, the Texans' offense continues to struggle as David Carr was only 5-for-11 for 49 yards in the second half and the Texans were so bad on offense against a mediocre Packers' defense that the capacity Reliant Stadium crowd started booing. Although the Texans' offensive line has not provided consistent protection over the past three games, Carr continues to fail to live up to his stature as the number one pick in the 2002 NFL Draft. In looking at the other 15 AFC teams, only five of them -- Baltimore, Buffalo, Miami, Cleveland, and Oakland -- would clearly trade their starting QB right now for Carr. For the first pick in the draft, Carr should be a better player than that, and his slow development is becoming a big problem for the Texans.
Baltimore 30 Dallas 10. Dallas actually led 3-0 after the first half, which was so bad that it almost placed the development of NFL offensive systems back several decades. The Cowboys next hope (maybe prayer?) at quarterback, Drew Henson, got some mop up duty in the fourth quarter, so maybe he will get the start against the Bears on Turkey Day. The Cowboys are simply a very bad football team right now, even worse than the Texans.
Louisville 63 Houston 27. The Coogs actually pulled to within eight points in this one just after the start of the fourth quarter, but then the Cardinals turned on the afterburners and left them in the dust (mud?) at Robertson Stadium. The Cougars finish 3-8 and, after two seasons of the Art Briles' era, still show no signs of developing a decent defense. Add in the need to re-develop the offensive line and the Cougars have their work cut out for them in this upcoming off-season.
The Aggies and Longhorns were idle this past weekend as they prepare for Friday's big game, and the Rice Owls were also off as they prepare for their last game of the season against Louisiana Tech that I believe is now scheduled for the Monday (?) after Thanksgiving at Reliant Stadium.
And, as usual, check out Kevin Whited's always insightful Big 12 Wrapup over at PubliusTx.net.
Posted by Tom at 5:17 AM | Comments (2) | TrackBack (0)