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December 31, 2010

The Beauty of Pixar

H/T Jason Kottke.

Posted by Tom at 12:00 AM | Comments (0) |

December 30, 2010

A Couple of Houston Dealmaking “F’s”

Steven M. Davidoff, the NY Times Dealbook's Deal Professor on the world of mergers and acquisitions, includes Landry's Restaurants, Inc's Tilman Fertitta - for many of the reasons chronicled over the past several years here --  in the group of businessmen getting an "F" for dealmaking in 2010:

Others deserving an F are Tilman Fertitta, chief executive of Landry's, for his second buyout effort of the restaurant company. Mr. Fertitta initially obtained the agreement of Landry's board to $14.50 a share to take Landry's private. He was then effectively forced by the hedge fund Pershing Square and the Delaware courts to raise his initial lowball bid to $24.50 a share.

Meanwhile, Dynegy, Inc's management team also gets an "F" in the category of shareholder communications:

COMMUNICATIONS In this perennially competitive category for bad grades, the F this year goes to Dynegy. The energy company threatened its shareholders with possible bankruptcy if a sale to the Blackstone Group was not completed at $4.50 a share. The threat made the company appear heavy-handed with its shareholders and was ill conceived, because only a month after the Blackstone sale was canceled, the company agreed to sell itself to Carl C. Icahn for $5.50 a share. This latest sale is also being challenged by one of Dynegy's largest shareholders.

Can't really argue with either evaluation.

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December 29, 2010

Lyle Lovett on Houston

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December 28, 2010

Play of the Year

My vote for the play of the year in college football. H/T Dr. Saturday.

Posted by Tom at 12:01 AM | Comments (0) |

December 27, 2010

Deepwater Horizon and the Gulf

Don't miss a couple of interesting articles from this past weekend regarding the Deepwater Horizon blowout in the Gulf of Mexico this past April.

First, this thorough NY Times article (and accompanying slideshow) focuses on the destruction of the Horizon rig, which was a distinct from the blowout itself:

It has been eight months since the Macondo well erupted below the Deepwater Horizon, creating one of the worst environmental catastrophes in United States history. With government inquiries under way and billions of dollars in environmental fines at stake, most of the attention has focused on what caused the blowout. Investigators have dissected BP's well design and Halliburton's cementing work, uncovering problem after problem.

But this was a disaster with two distinct parts - first a blowout, then the destruction of the Horizon. The second part, which killed 11 people and injured dozens, has escaped intense scrutiny, as if it were an inevitable casualty of the blowout.

It was not.

Nearly 400 feet long, the Horizon had formidable and redundant defenses against even the worst blowout. It was equipped to divert surging oil and gas safely away from the rig. It had devices to quickly seal off a well blowout or to break free from it. It had systems to prevent gas from exploding and sophisticated alarms that would quickly warn the crew at the slightest trace of gas. The crew itself routinely practiced responding to alarms, fires and blowouts, and it was blessed with experienced leaders who clearly cared about safety.

On paper, experts and investigators agree, the Deepwater Horizon should have weathered this blowout.

This is the story of how and why it didn't.

Meanwhile, this Robert Nelson/Weekly Standard article points out that it now is becoming apparent that the Gulf of Mexico suffered remarkably little damage from the oil spill that resulted from the blowout:

Oddly enough, however, the ecosystem of the Gulf itself turns out to have suffered remarkably little damage from the continuous gushing of oil into the water from April 20 till July 15, when the leaking well was capped. One group of scientists rated the health of the Gulf's ecology at 71 on a scale of 100 before the spill and 65 in October. By mid-August, the National Oceanic and Atmospheric Administration (NOAA) was having trouble finding spilled oil. This squared with the finding of researchers from the Lawrence Berkeley National Laboratory in California that the half-life of much of the leaking oil was about three days. At that rate, more than 90 percent would have disappeared in 12 days.

NOAA explained one reason for this in a report in August: "It is well known that bacteria that break down the dispersed and weathered surface oil are abundant in the Gulf of Mexico in large part because of the warm water, the favorable nutrient and oxygen levels, and the fact that oil regularly enters the Gulf of Mexico through natural seeps." In other words, the organisms that normally live off the Gulf's large natural seepage of oil into the water multiplied extremely rapidly and went on a feeding frenzy. Another 25 percent of the spilled oil-the lightest and most toxic part-simply evaporated at the surface or dissolved quickly.

Damage to wildlife, too, was relatively sparse. As of November 2, the U.S. Fish and Wildlife Service reported that 2,263 oil-soiled bird remains had been collected in the Gulf, far fewer than the 225,000 birds killed by the Exxon Valdez spill in Alaska in 1989. Despite fears for turtles, only 18 dead oil-soiled turtles had been found. No other reptile deaths were recorded.

While more than 1,000 sea otters alone had died in the Alaska spill, only 4 oil-soiled mammals (including dolphins) had been found dead in the Gulf region. These are very small numbers relative to the base populations. Similarly, government agencies were unable to find any evidence of dead fish. Fish can simply swim away from trouble. Nor was evidence found of contamination of live fish. In one government test, 2,768 chemical analyses uncovered no signs of contamination.

In the latest irony, marine biologists this fall have actually been seeing surprising increases in some fish populations. It seems that the closure of large areas of the Gulf to fishing amounted to an unplanned experiment in fisheries management. According to Sean Powers, a University of South Alabama marine biologist, "It's just been amazing how many more sharks we are seeing this year. I didn't believe it at first." He attributed the change to the "incredible reduction in fishing pressure," and added, "What's interesting to me [is that] we are seeing it across the whole range, from the shrimp and small croaker all the way up to the large sharks."

Posted by Tom at 12:01 AM | Comments (1) |

December 26, 2010

Golfing with Hickory Shafts in Scotland

Check out the video of Geoff Shackelford's retro round earlier this year at Kingarrock Golf Club in Scotland.

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December 25, 2010

Merry Christmas from the Family

Native Houstonian Robert Earl Keen sings his classic Texas country Christmas tune.

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December 24, 2010

Zeitgeist 2010

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December 23, 2010

The Eloquence of a Football Coach

Following on this earlier video of former Montana Tech football coach Bob Green, Tennessee's Derek Dooley sounds as if he could be a worthy successor in the homespun humor department.

Posted by Tom at 12:01 AM | Comments (1) |

December 22, 2010

Thinking about income redistribution

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December 21, 2010

Casino Jack Abramoff

Kevin Spacey is a national treasure.

Posted by Tom at 12:01 AM | Comments (1) |

December 20, 2010

Johnny Carson on Politicians

The late Ross Lence, my mentor in undergraduate school, used to laugh when his students decried the lies of politicians. Lence contended that we expect - indeed, we want - our politicians to lie in order to make us feel better about the myths that we rely on about ourselves and our country in our day-to-day lives.

The late Johnny Carson provides a hilarious take on politicians' lies in this classic video from almost 30 years ago. Enjoy.

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December 19, 2010

Bill Murray on Robert Duvall

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December 18, 2010

Rocky Top

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December 17, 2010

Protecting the Children

No, really. this is not from The Onion:

The Center for Science in the Public Interest has filed a lawsuit against McDonald's Corp., claiming that the company's meals with toys unfairly entice children into eating food that can do them harm.

The Washington advocacy group warned McDonald's in June that it would sue if the company did not stop providing toys with children's meals that have high amounts of sugar, calories, fat and salt. The suit, filed in San Francisco Superior Court, seeks class-action status.[.  .  .]

The lead plaintiff in the suit is Monica Parham, a mother of two from Sacramento who said the company "uses toys as bait to induce her kids to clamor to go to McDonald's," the organization said.

Ms. Parham has to sue McDonald's rather than simply telling her children "no"? Walter Olson chronicles here.

Posted by Tom at 12:01 AM | Comments (2) |

December 16, 2010

The 40-Year War

Gary Becker makes a good point about a frequent topic on this blog - the enormous cost of the government's drug prohibition policy:

[The Miron and Waldock study does] a good job of estimating the amount directly spent by the United States in fighting the war on drugs. They calculate about $41 billion is spent on this fight by state and local governments, and by the federal government, through policing efforts, the cost of court personnel and buildings used to try and convict drug offenders, and the cost of the guards and other resources used to imprison those convicting of drug offenses.  .  .  .  These estimated direct costs of the war are significant, yet they are regrettably only a small fraction of the total social costs due to the war on drugs. [ .  .  .]

Perhaps, however, the worse results of the American war on drugs are found in its effects on other countries, especially Mexico, Colombia, and other Latin American countries. Mexico is also engaged in a war on drugs, but it is a war almost entirely fought against drugs shipped from Mexico into the United States. The overwhelming majority of drugs that are either produced in Mexico, or that enter Mexico from other countries, are destined for shipment across the border to the United States. The two main drugs shipped from Mexico are marijuana and cocaine, the same two drugs that Miron and Waldock show constitute the vast majority of drugs used by American consumers.

Mexico is engaged in a real war, with advanced military equipment used by the drug gangs; often the gangs have better weapons than the army does. The casualties have been huge: an estimated 30,000 + persons have been killed in recent years as a result of the drug violence, far greater than the combined deaths of American and allied forces in Iraq and Afghanistan. Many of these deaths are of drug cartel members, but a considerable number also are of soldiers and policemen, journalists, and innocent bystanders.

After the drug lords discovered that they are very good at violence and intimidation, they expanded geographically and into other activities. They have spread out from concentration in enclaves near the border or in the West of Mexico into many other areas, including major cities like Monterrey. Some towns have become uninhabitable, as former residents fled from the violence, some entering illegally into the US. Drug lords have taken control in many places of prostitution, gambling, extraction of monies from businesses for "protection" services, and indirectly also various local governments. [.  .  .]

No one has estimated the social cost of American drug policy on Mexico, Colombia, and other countries, but it has to be immense. Perhaps these countries should just allow drugs to be shipped to the US, and put the full burden of stopping these shipments on American enforcement agencies. The American government would protest, but such a result would provide a clearer picture to the American people of the full cost of current policy, including the major costs imposed on other countries. One can hope that then we will get a serious rethinking of the American war on drugs, and some real political movement toward decriminalization and legalization of various drugs.

Posted by Tom at 12:01 AM | Comments (1) |

December 15, 2010

Malkiel on investing

Burton Malkiel's WSJ op-ed yesterday on the importance of investing in China's growth reminded me of this lengthy and engaging lecture that he gave earlier this year. It may take several sessions to get through the entire talk, but it's definitely worth the effort.

Posted by Tom at 12:00 AM | Comments (0) |

December 14, 2010

Callaway vs. Lamborghini

H/T Geoff Shackelford

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December 13, 2010

Judge Kozinski on the criminalization of business lottery

Larry Ribstein -- the law professor who has done more than anyone in the blogosphere to decry the enormous financial and human cost of the federal government's criminalization of business lottery over the past decade - highlights  in this blog post Ninth Circuit Judge Alex Kozinski's lucid concurrence in the Ninth Circuit's reversal of the business fraud conviction of former Network Associates CFO, Prabhat Goyal:

This case has consumed an inordinate amount of taxpayer resources, and has no doubt devastated the defendant's personal and professional life. The defendant's former employer also paid a price, footing a multimillion dollar bill for the defense. And, in the end, the government couldn't prove that the defendant engaged in any criminal conduct. This is just one of a string of recent cases in which courts have found that federal prosecutors overreached by trying to stretch criminal law beyond its proper bounds. See Arthur Andersen LLP v.United States, 544 U.S. 696, 705-08 (2005); United States v. Reyes, 577 F.3d 1069, 1078 (9th Cir. 2009); United States v. Brown, 459 F.3d 509, 523-25 (5th Cir. 2006); cf. United States v. Moore, 612 F.3d 698, 703 (D.C. Cir. 2010) (Kavanaugh, J., concurring) (breadth of 18 U.S.C. § 1001 creates risk of prosecutorial abuse).

This is not the way criminal law is supposed to work. Civil law often covers conduct that falls in a gray area of arguable legality. But criminal law should clearly separate conduct that is criminal from conduct that is legal. This is not only because of the dire consequences of a conviction-including disenfranchisement, incarceration and even deportation-but also because criminal law represents the community's sense of the type of behavior that merits the moral condemnation of society. See United States v. Bass, 404 U.S. 336, 348 (1971) ("[C]riminal punishment usually represents the moral condemnation of the community . . . ."); see also Wade v. United States, 426 F.2d 64, 69 (9th Cir. 1970) ("[T]he declaration that a person is criminally responsible for his actions is a moral judgment of the community . . . ."). When prosecutors have to stretch the law or the evidence to secure a conviction, as they did here, it can hardly be said that such moral judgment is warranted.

Mr. Goyal had the benefit of exceptionally fine advocacy on appeal, so he is spared the punishment for a crime he didn't commit. But not everyone is so lucky. The government shouldn't have brought charges unless it had clear evidence of wrongdoing, and the trial judge should have dismissed the case when the prosecution rested and it was clear the evidence could not support a conviction. Although we now vindicate Mr. Goyal, much damage has been done. One can only hope that he and his family will recover from the ordeal. And, perhaps, that the government will be more cautious in the future.

As Professor Ribstein has been saying for years, the problem with this policy is that the government is prosecuting agency costs, such as KPMG pushing the edge of the envelope on tax shelters or Andersen not using very good sense in carrying out its document retention policy.

There is a big difference between prosecuting agency costs and prosecuting clear-cut crimes, such as embezzlement. The difference relates primarily to the nature of the evidence involved, the relevance of contracts, and the subtleties of dividing responsibility between corporate actors.

Professor Ribstein has put it this way. Suppose somebody mugs you on the street. There is no question that is a crime.

However, what if the mugger asks you first if he can borrow your wallet, you loan it to him, and then he doesn't give it back in time? What if the mugger asks your employee who's running the store for you whether he can borrow some money, the employee allows it and then the mugger doesn't pay it back? What if the "thief" is another employee who says the manager gave him the money as bonus compensation?

Who is liable in these situations turns on the contracts among the various parties. Proof depends on who said what to whom. Can we rely on what the witnesses say about this? What if the prosecutor tells the employee who's minding the store that he'll not face prosecution for conspiracy if he spills the beans on the other employee who says that the manager gave him bonus compensation?

Society needs to have appropriate punishment and accounting for clear-cut crimes. But in cases such as Enron or Lehman Brothers, the civil lawsuits -- unlike the criminal prosecution - included all the people involved, including the directors who approved wrongful corporate conduct and accountants and lawyers who may have facilitated it. That is a much more rational and effective way in which to deal with agency costs than attempting to make them appear to be clear-cut crimes, which they simply are not.

Finally, criminal prosecutions over merely questionable business judgment obscure the true nature of risk and fuel the myth that investment loss results primarily from criminal misconduct. Taking business risk is what leads to valuable innovation and wealth creation. Throwing creative and productive business executives such as Michael Milken and Jeff Skilling in prison does nothing to educate investors about the true nature of risk and the importance of diversification.

The supposed payoff to criminal prosecutions of agency costs is deterrence. But some businesspeople will keep on pulling these shenanigans regardless of the prosecutions, while the legitimate risk-takers who create jobs and wealth for the community sorts will be the ones who are deterred.

I'm not suggesting that the Bernie Madoffs of the world should be encouraged. But the cases against businesspeople such as Milken, Skilling, Hank Greenberg, Jamie Olis, the NatWest Three and the Merrill Lynch bankers are fundamentally different than Madoff's scam, and I am not comfortable that politically ambitious prosecutors can tell the difference. As Professor Ribstein notes in another article, "prosecutors turn up the fire [in mounting dubious business prosecutions] and then sell extinguishers."

Posted by Tom at 12:01 AM | Comments (1) |

December 12, 2010

Scotland’s Caddies

H/T Geoff Shackelford

 

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December 11, 2010

Dylan at his best

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December 10, 2010

The Shootout

It's been a tough season for the Longhorns and their followers, so it's an appropriate time to recall some better times -- the 1969 Shootout between No. 1 Texas and No. 2 Arkansas. One of the most entertaining games in the history of college football.

Posted by Tom at 12:01 AM | Comments (1) |

December 9, 2010

ABC’s Announcement of John Lennon’s Murder

Did you remember that it came toward the end of a Monday Night Football game? Below is a well done retrospective by ESPN Outside the Lines.  Well worth the 10 minute watch.

Posted by Tom at 12:01 AM | Comments (0) |

December 8, 2010

Art DeVany on The New Evolution Diet

Clear Thinkers favorite Art DeVany (previous posts here) is preparing for the release of his new book, The New Evolution Diet: What Our Paleolithic Ancestors Can Teach Us About Weight Loss, Fitness and Aging (Rodale Dec. 21, 2010), so he presents his basic ideas on nutrition and exercise in the trailer for the book below. Russ Roberts' longer audio interview of DeVany from earlier this year can be listened to here and Patrick Kiger provides an excellent overview of DeVany's ideas on nutrition and exercise here.

Posted by Tom at 12:01 AM | Comments (0) |

December 7, 2010

Richard Epstein on Obama

Reason's Nick Gillespie recently interviewed Richard A. Epstein (previous posts here), who explains how misdirected governmental programs under both Republican and Democratic administrations are having a devastating impact on economic growth and prosperity.

The entire interview is well worth watching. However, the initial portion of it (excerpted below) is particularly interesting because Epstein passes along his personal observations about Barack Obama gained from his experiences with Obama while both served on the University of Chicago Law School faculty.

While certainly not as bad as this, Epstein's portrayal of Obama is but not particularly reassuring, either.

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December 6, 2010

The challenge of managing a business profitably

Most people underappreciate the difficulty of managing a business profitably. This video explains a big part of the problem well.

Posted by Tom at 12:01 AM | Comments (1) |

December 5, 2010

Braeburn Country Club

As the warm autumn days of southeast Texas give way to the cooler days of winter, I want to pass along some photos that I took earlier this fall of the Braeburn Country Club golf course, which is one of Houston's oldest and most interesting tracts.

A group headed by Houston's legendary PGA professional Jimmy Demaret developed Braeburn on what was then a suburban piece of property off of Bissonnet Road  in the the mid-1920's. The group hired well-regarded architect John Brademus (Colonial in Ft. Worth; Memorial Golf Club in Houston) to design the course, which turned out to be a short but challengingly tight tract.

Unfortunately, as with many clubs developed during the Roaring 20's, Braeburn fell on hard times after the stock market crash of 1929 and was sold at a foreclosure sale by the bank that had financed Demaret's group. Jack Burke, Sr. - then the pro at Houston's River Oaks Country Club - formed another group that purchased the golf course from the bank in the early 1930's.

Interestingly, Demaret and Burke's son - Jack Burke, Jr. - went on to develop Houston's storied Champions Golf Club 25 years later in the late 1950's.

But the defining moment for Braeburn came almost 60 years after its creation when the club entered into a creative deal with the Harris County Flood Control District in which the district allowed the club to use almost $2.5 million in funds earmarked for flood control to renovate the course in a manner that transformed it into a flood runoff area for a nearby bayou during periods of heavy rains.

The club hired the late Carlton Gipson to oversee the renovation of the course and the result was a masterpiece that ranks among Gipson's best. Gipson had his crew move over 300,000 cubic feet of dirt in creating the flood retention areas and, in so doing, transformed what had previously been a flat-land Houston course into one that has numerous elevation changes that are rarely seen on Houston-area golf courses.

So, say good-bye to autumn by taking a tour of Braeburn in the slideshow below or download an MP4 version of the slideshow here. Enjoy!

Posted by Tom at 12:01 AM | Comments (0) |

December 4, 2010

Another good commercial

In this blog's continuing series of innovative commercials from over the years, here is another excellent one from Turkish Airlines with help from Manchester United.

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December 3, 2010

200 Countries, 200 Years, 4 Minutes

Plotting life expectancy against income for 200 countries since 1810, Hans Rosling shows the enormous impact that the increase in wealth has had on the world (H/T Don Boudreaux).

Posted by Tom at 12:01 AM | Comments (1) |

December 2, 2010

How WikiLeaks is like the office holiday party

Inasmuch as I believe the hoopla over the WikiLeaks disclosures is mostly overblown, I'm not going to post much on it. Except to point out again that the FT's Gideon Rachman really has the right perspective toward it all:

It's amusing for the rest of us to read US diplomats' frank and sometimes unflattering verdicts on foreign leaders, and it's obviously embarrassing for the Americans.

It's a bit like somebody getting drunk at a party and making bitchy comments in too loud a voice. Nobody is incredibly shocked that such things happen. But it's still awkward to be overheard by the person you are talking about.

Posted by Tom at 12:01 AM | Comments (0) |

December 1, 2010

A lesson on using other people’s money

Well, maybe it's not all so bad after all that the Harris County Sports Authority used junk debt to finance construction of Reliant Stadium. Check out what's going on in St. Louis (H/T Craig Depken):

Eight years ago, as the St. Louis Cardinals aimed to build a new baseball stadium, team owners signed an agreement with the city worth millions of dollars a year in tax breaks.

In exchange, the team agreed to a series of annual perks for the region's residents - 100,000 free tickets, 486,000 seats for under $12 and $100,000 in donations to recreation for disadvantaged youths.

The Cardinals also agreed to give the city a cut of profits made if any portion of the team was sold.

Then, last year, owners sold a sizeable chunk of the Cardinals - more than 13 percent. Now, a group of anti-public-stadium advocates is alleging that the team owes the city hundreds of thousands of dollars.

And, despite another multimillion-dollar budget gap anticipated for the coming year, the city isn't checking into it. City officials acknowledge that they have never really kept tabs on the agreement.

.    .     . Several city officials, including Barb Geisman, the former deputy mayor for development, said there was no reason to double-check. They trust the Cardinals.

Which reminds me of what the late Milton Friedman used to say about the dynamics of using other people's money:

"There are four ways in which you can spend money."

"You can spend your own money on yourself. When you do that, why then you really watch out what you're doing, and you try to get the most for your money."

"Then you can spend your own money on somebody else. For example, I buy a birthday present for someone. Well, then I'm not so careful about the content of the present, but I'm very careful about the cost."

"Then, I can spend somebody else's money on myself. And if I spend somebody else's money on myself, then I'm sure going to have a good lunch!"

"Finally, I can spend somebody else's money on somebody else. And if I spend somebody else's money on somebody else, I'm not concerned about how much it is, and I'm not concerned about what I get."

"And that's government .   .   ."

Posted by Tom at 12:01 AM | Comments (3) |

November 30, 2010

Defending WikiLeaks

Although my view of the latest WikiLeaks disclosures is much the same as FT's Gideon Rachman (I mean, really, who would have thought that Silvio Berlusconi is feckless and vain?), my sense is that Will Wilkinson's initial analysis correctly identifies the importance of these disclosures:

To get at the value of WikiLeaks, I think it's important to distinguish between the government-the temporary, elected authors of national policy-and the state-the permanent bureaucratic and military apparatus superficially but not fully controlled by the reigning government. The careerists scattered about the world in America's intelligence agencies, military, and consular offices largely operate behind a veil of secrecy executing policy which is itself largely secret. American citizens mostly have no idea what they are doing, or whether what they are doing is working out well. The actually-existing structure and strategy of the American empire remains a near-total mystery to those who foot the bill and whose children fight its wars. And that is the way the elite of America's unelected permanent state, perhaps the most powerful class of people on Earth, like it. [.  .  .]

If secrecy is necessary for national security and effective diplomacy, it is also inevitable that the prerogative of secrecy will be used to hide the misdeeds of the permanent state and its privileged agents. I suspect that there is no scheme of government oversight that will not eventually come under the indirect control of the generals, spies, and foreign-service officers it is meant to oversee.

Organisations such as WikiLeaks, which are philosophically opposed to state secrecy and which operate as much as is possible outside the global nation-state system, may be the best we can hope for in the way of promoting the climate of transparency and accountability necessary for authentically liberal democracy. Some folks ask, "Who elected Julian Assange?" The answer is nobody did, which is, ironically, why WikiLeaks is able to improve the quality of our democracy.

Of course, those jealously protective of the privileges of unaccountable state power will tell us that people will die if we can read their email, but so what? Different people, maybe more people, will die if we can't.

Reminds me of the debate that occurred as a result of similar disclosures over a generation ago.

Posted by Tom at 12:01 AM | Comments (0) |

November 29, 2010

The Real Threat of Security Theater

Writing in the NY Times over the holiday weekend, Roger Cohen lucidly identifies the true threat of the elaborate security theater that the Transportation Security Administration has foisted upon us in our nation's airports:

I don't doubt the patriotism of the Americans involved in keeping the country safe, nor do I discount the threat, but I am sure of this: The unfettered growth of the Department of Homeland Security and the T.S.A. represent a greater long-term threat to the prosperity, character and wellbeing of the United States than a few madmen in the valleys of Waziristan or the voids of Yemen.

America is a nation of openness, boldness and risk-taking. Close this nation, cow it, constrict it and you unravel its magic. [.  .  .]

.  .  . During the Bosnian war, besieged Sarajevans had a word - "inat" - for the contempt-cum-spite they showed barbarous gunners on the hills by dressing and carrying on as normal. Inat is what Americans should show the jihadist cave-dwellers.

So I give thanks this week for the Fourth Amendment: "The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized."

I give thanks for Benjamin Franklin's words after the 1787 Constitutional Convention describing the results of its deliberations: "A Republic, if you can keep it."

To keep it, push back against enhanced patting, Chertoff's naked-screening and the sinister drumbeat of fear.

Amen.

Posted by Tom at 12:01 AM | Comments (1) |

November 28, 2010

Turn, Turn, Turn

Roger McGuinn provides a masterful solo performance of The Byrds' classic.

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November 27, 2010

Split or Steal

A good lesson in psychology here.

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November 26, 2010

Baby Blue

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November 25, 2010

Turkey Day Carving Lesson

For the past several years, I have been passing along on Thanksgiving Day the instructions below, this interesting article and this excellent NY Times video that provide insightful butcher tips on how to get the most meat out of your turkey. Enjoy!

Posted by Tom at 12:01 AM | Comments (0) |

November 24, 2010

Are you ready for some football?

There is no better way to get ready for the long Thanksgiving holiday weekend of football than to take a dose of former Montana Tech football coach, Bob Green.

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November 23, 2010

America’s experiment with universal coverage

Many folks believe that universal health insurance coverage is a panacea to the fractured U.S. health care finance system. But take a few minutes to read this masterful Robin Fields/Atlantic article on the unexpected consequences of the nearly universal coverage provided for kidney dialysis patients:

IN OCTOBER 1972, after a month of deliberation, Congress launched the nation's most ambitious experiment in universal health care: a change to the Social Security Act that granted comprehensive coverage under Medicare to virtually anyone diagnosed with kidney failure, regardless of age or income.

It was a supremely hopeful moment. Although the technology to keep kidney patients alive through dialysis had arrived, it was still unattainable for all but a lucky few. At one hospital, a death panel-or "God committee" in the parlance of the time-was deciding who got it and who didn't. The new program would help about 11,000 Americans for starters, and for a modest initial price tag of $135 million, would cover not only their dialysis and transplants, but all of their medical needs. Some consider it the closest that the United States has come to socialized medicine.

Now, almost four decades later, a program once envisioned as a model for a national health-care system has evolved into a hulking monster. Taxpayers spend more than $20 billion a year to care for those on dialysis-about $77,000 per patient, more, by some accounts, than any other nation. Yet the United States continues to have one of the industrialized world's highest mortality rates for dialysis care. Even taking into account differences in patient characteristics, studies suggest that if our system performed as well as Italy's, or France's, or Japan's, thousands fewer kidney patients would die each year.

In a country that regularly boasts about its superior medical system, such results might be cause for outrage. But although dialysis is a lifeline for almost 400,000 Americans, few outside this insular world have probed why a program with such compassionate aims produces such troubling outcomes. Even during a fervid national debate over health care, the state of dialysis garnered little public attention.

Yet another example of what  Arnold Kling has observed about U.S. health care -- why do we think that that we cannot possibly afford high-quality health care if we have to pay for it individually, but we can afford it if we pay for it collectively?

Posted by Tom at 12:01 AM | Comments (4) |

November 22, 2010

SNL TSA/Security Theater Advertisement

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November 21, 2010

Tasty Waves!

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November 20, 2010

Tina Fey accepts the Mark Twain Prize for American Humor

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November 19, 2010

The End of the Backdating Lottery?

Larry Ribstein from the blogosphere and Holman Jenkins from the financial media have been leaders over the past several years in exposing the Department of Justice's disingenuous campaign to criminalize the corporate compensation technique commonly known as backdating stock options.

Now, with Judge Wright's sentencing decision last week in the criminal case of former KB Home executive Bruce E. Karatz, Ribstein and Jenkins' insight has finally been judicially adopted. The real crime in the backdating scandal was that prosecutors and the mainstream media once again jumped to create a witch hunt targeting wealthy businesspeople even though it was far from clear that backdating was actionable from a civil standpoint, much less a criminal one.

So, what drives this damaging syndrome? We use myths - such as that wealthy businesspeople must have cheated to make so much money -- to distract us from our innate vulnerability. We rationalize that a wealthy and powerful person did bad things that we would never do if placed in the same position even though we really have no idea how we would react to the incentives that the object of scorn faced. As a result, we ridicule the rich and powerful as we attempt to purge collectively that which is too shameful for us to confront individually.

Beyond the shattered careers, lives and families that lay in the wake of this syndrome, it is incredibly damaging to our society in other important respects.

For example, business prosecutions over merely questionable business judgment obscure the true nature of risk and fuel the myth that investment loss results primarily from criminal misconduct rather than market forces. In reality, business risk is what leads to valuable innovation and wealth creation. Throwing creative and productive business executives such as Michael Milken and Jeff Skilling in prison does nothing to educate investors about the true nature of risk and the importance of such investment strategies as diversification.

Moreover, ignorance about business risk has led in part to the criminalization of business lottery that is arguably best reflected in the selective prosecutions of the backdating cases. That lottery simply breeds even more cynicism for the rule of law.

So, isn't it about time that we put such an obviously damaging syndrome to rest for good?

 

Posted by Tom at 12:01 AM | Comments (2) |

November 18, 2010

NYC Marathon Runners

Posted by Tom at 12:01 AM | Comments (0) |

November 17, 2010

Putting the Pencil to the Federal Budget

Several days ago, I posted on Twitter about the NY Times federal budget calculator, which is receiving well-deserved praise around the blogosphere.

For example, economists such as Clear Thinkers favorites David Henderson and Arnold Kling  -- as well as financial columnist James Pethokoukis -- provide their views on what spending cuts to make in balancing the budget within a reasonable period of time without raising taxes.

As John Goodman points out, though, the elephant in the parlor in cutting the budget is how to corral Medicare costs without causing corresponding harm to the elderly. Details, details  .   .   .

Nevertheless, Professor Henderson sums up the importance of the calculator as an educational tool:

Here's a prediction: if the New York Times keeps this game up on its site, a whole lot of people are going to be more sympathetic to cutting government and more optimistic that it can be done.

One of my objections to Tea Partiers is how uninformed some of them are about the numbers. Now, thanks to the New York Times, they don't have to be.

Posted by Tom at 12:01 AM | Comments (3) |

November 16, 2010

Will Security Theater Endure?

Regular readers of this blog know that I've been critical of the Transportation Security Administration's absurdly inefficient and largely worthless airport screening procedures for five years now.

Although always hopeful, I never thought that it was realistic to dismantle the TSA entirely. Sadly, it's become yet another governmental jobs program with its own vested interests lobbying for its existence in perpetuity.

Nevertheless, I remained hopeful that something could eventually be done to constrain the TSA's seemingly unfettered capacity to make airline travel an mostly miserable experience.

So, the recent groundswell of opposition to the TSA's latest  outrage in screening procedures - as summarized in this Art Carden/Forbes article (see also pilot Patrick Smith's Salon op-ed here)- has been an unexpected but welcome movement. I mean, really. How many more TSA outrages such as the that  John Tyner chronicled will have to occur before politicians who oppose constructive change will be at risk of losing their jobs?

As airlines brace for the possible negative impact that the TSA agents' boorish actions may have on the upcoming holiday travel season, David Henderson notes one of the unanticipated consequences of the TSA's chilling effect on airline travel:

.   .   . let's remember the stakes. It's not just our privacy, our dignity, and our right not to be sexually assaulted. It's also about our lives. People who decide to drive rather than take a short-haul flight will face approximately 80 times the fatality rate per mile that people on commercial airlines face.

The TSA is killing people.

Moreover, beyond the infantile behavior of TSA agents, the wasted time and expense resulting from these procedures is appalling. Michael Chertoff, the former head of Homeland Security, promoted the supposed benefits of the new scanners when he was in office, and now he is a lobbyist persuading TSA to buy them!

As with the overcriminalization of American life, the TSA is another symbol of a federal government that is increasingly remote and unresponsive to its citizens.

Is this a trend that can be changed? Perhaps the curious case of the TSA will answer that question.

Posted by Tom at 12:01 AM | Comments (1) |

November 15, 2010

First Aid Tips

Following on periodic posts regarding developments in providing first aid, Dr. Alex Lickerman provides his top ten rules for providing first aid that everyone needs to know:

1. Don's panic.

2. First do no harm.

3. CPR can be life-sustaining.

4. Time counts.

5. Don't use hydrogen peroxide on cuts or open wounds.

6. The two most important pieces of info when someone passes out is the pulse rate and the length of time before consciousness returns.

7. High blood pressure is rarely acutely dangerous.

8. If a person can talk or cough, their airway is open.

9. Most seizures are not emergencies.

10. Drowning doesn't look like what you think it does.

Elaboration on the foregoing rules is here. Good information to pass along to family members and friends.

Posted by Tom at 8:51 PM | Comments (0) |

November 14, 2010

Things you don’t say to your wife

Posted by Tom at 12:01 AM | Comments (0) |

November 13, 2010

A Question for Kent Friedman

Harris County Sports Authority Board Chairman J. Kent Friedman is not concerned that the Sports Authority has had to dip into its cash reserves for the first time in order to make a debt service payment on the junk debt it issued to finance construction of Reliant Stadium:

Friedman said paying off a 30-year mortgage in five years could produce a windfall.

"The savings on that is staggering" as the authority avoids years of interest payments, Friedman said. "The Sports Authority, and, by extension, the community, will be a lot better off if we can pay these bonds off early."

Which raises the question that, if such is the case, why did the Sports Authority finance the bonds over 30 years in the first place?

What's most interesting about this situation is the change that it reflects in regard to public financing of stadiums. JP Morgan Chase has evaluated the situation and concluded that tax revenues dedicated to the bonds are so risky in the future that it is better off forcing the Sports Authority to dip into reserves and pay off the bonds in five years.

Could the fact that Harris County continues to dither over the mothballed Astrodome - which still is subject to over $30 million in bond indebtedness - have something to do with JP Morgan Chase's decision?

Or is JP Morgan Chase simply hedging its risk regarding another bubble?

Posted by Tom at 12:01 AM | Comments (0) |

November 12, 2010

An unintended consequence of Medicare

A frequent topic on this blog has been the demise of primary care under our third-party payor-dominated health care finance system.  Richard M. Hannon, a Blue Cross-Blue Shield executive, provides a particularly lucid explanation in this recent WSJ op-ed on how one of the unintended consequences of Medicare was the negative impact it had on the delivery of primary care to patients:

Medicare introduced a whole new dynamic in the delivery of health care. Gone were the days when physicians were paid based on the value of their services. With payment coming directly from Medicare and the federal government, patients who used to pay the bill themselves no longer cared about the cost of services.

Eventually, that disconnect (and subsequent program expansions) resulted in significant strain on the federal budget. In 1966, the House Ways and Means Committee estimated that by 1990 the Medicare budget would quadruple to $12 billion from $3 billion. In fact, by 1990 it was $107 billion.

To fix the cost problem, Medicare in 1992 began using the "resource based relative value system" (RBRVS), a way of evaluating doctors based on factors such as education, effort and specialized training. But the system didn't consider factors such as outcomes, quality of service, severity or demand.

Today most insurance companies use the Medicare RBRVS because it is perceived as objective. As a result of RBRVS, specialists-especially those who perform a lot of procedures-do extremely well. Primary-care doctors do not.

The primary-care doctor has become a piece-rate worker focused on the volume of patients seen every day. As Medicare and insurers focused on trimming the costs of the most common procedures, the income and job satisfaction of primary-care doctors eroded.

So these doctors left, sold or changed their practices. New health-care service models, such as the concierge practice and the Patient-Centered Medical Home, drew doctors away from the standard service models that most patients rely on for coverage.

All of these factors have contributed to a fragmented, expensive health system with most of the remaining doctors focused on reactive instead of preventive care.

The solution to the problem is making primary-care physicians the captains of the ship. They must have the time and financial resources necessary to take care of their patients, tailoring care to patients' specific conditions and needs. And they need the data to track their patients' results, so they can guide patient progress. They will then be able to slow (and sometimes reverse) their patients' illnesses, keeping them out of hospital emergency rooms and specialists' offices. The end result: reduced costs and improved quality of care.

So who really killed primary care? The idea that a centrally planned system with the right formulas and lots of data could replace the art of practicing medicine; that the human dynamics of market demand and the patient-physician relationship could be ignored. Politicians and mathematicians in ivory towers have placed primary care last in line for respect, resources and prestige-and we all paid an enormous price.

The pervasive effect of the now engrained third-party payor system of health care finance is that many patients do not feel any responsibility for their health care expenses.  As Arnold Kling has observed, why do we think that that we cannot possibly afford high-quality health care if we have to pay for it individually, but we can afford it if we pay for it collectively?

Posted by Tom at 12:01 AM | Comments (2) |

November 11, 2010

Dennis Hopper talks about Hoosiers

Given that the basketball season is now in full swing, don't miss the late Dennis Hopper comments on the best movie about basketball ever made, Hoosiers (1986), including his co-star Gene Hackman's trepidation during shooting of the movie's prospects for success.

Posted by Tom at 12:01 AM | Comments (0) |

November 10, 2010

What is the greater corruption?

This?

Or the FBI using its resources to investigate this?

The FBI shouldn't be involved in such matters at all. But if the G-Men insist on investigating, they should be investigating why some institutions of higher education are getting away with making great wealth from their football programs while colluding to restrict the compensation paid to the predominantly black professional athletes who take enormous risk to life and limb to generate that wealth.

If Cam Newton received money to play for Auburn, I'm glad he got it and that he didn't take the discounted payment from Mississippi State. He deserves every dime that he was paid.

Posted by Tom at 12:01 AM | Comments (2) |

November 9, 2010

Guilty until proven innocent

R. Allen Stanford is not a popular person to defend.

But one does not have to defend what Stanford allegedly did in building his financial empire to decry the treatment that he has received from the federal government since his indictment in early 2009.

These earlier posts pointed out the federal government's unusually brutal treatment of Stanford pending his trial on business fraud charges that will probably take place sometime next year. The Department of "Justice" routinely responded to Stanford's motion by contending that nothing unusual had occurred with regard to Stanford and that he was being treated the same as any other defendant who was being held in prison pending trial.

Well, that contention appears to be bullshit, to put it mildly. The Daily Mail Online finally obtained photos of Stanford after he had been attacked in prison (H/T Henry Blodget) and they depict injuries that are even worse than those described in Stanford's court pleadings. 

For years, we allowed an out-of-control federal task force - egged on by a vacuous mainstream media - to ride roughshod over local citizens' Constitutional rights. Now, before our eyes, the presumption of innocence has been eviscerated in the Stanford case with nary a peep of protest other than from Stanford's attorneys and a few bloggers.

"When the last law was down, and the Devil turned 'round on you, where would you hide, the laws all being flat?"

"[D]o you really thing you could stand upright in the winds that would blow then?"

Posted by Tom at 12:01 AM | Comments (1) |

November 8, 2010

Grand Pines at Bentwater

Grand Pines Golf Club is the newest of the three courses at Bentwater, which is a residential development and country club on the north side of Lake Conroe about 60 miles north of downtown Houston. 

The first two Bentwater courses -  Tom Weiskopf and Jay Moorish designed the first (1989) and Scott Miller the second (1992) - are subdivison courses with homes built along some of the fairways and around some of the greens.

Grand Pines, which was designed by local golf course architect Jeff Blume (2007), is a different animal altogether from the first two Bentwater courses. Built on the north side of FM 1097 across the highway from the rest of the Bentwater development, Grand Pines is not a subdivision course - there are no homes to be seen around the course. Built literally next to the Sam Houston National Forest, Grand Pines is also quite hilly, which is unusual for courses built in the relatively flat coastal plain of Texas.  As you will note from the slideshow below (a high resolution version can be downloaded here), the combination of trees and elevation changes makes Grand Pines both a delight to look at and a challenging test of golf.

Grand Pines plays to a 133 slope rating and a tad over 7,200 yards from the tips and a 131 slope rating and about 6,700 yards from the men's tees. It is clearly in the top 10 of Houston-area golf courses and a fine addition to the bustling Lake Conroe golf scene. Enjoy!

Posted by Tom at 12:01 AM | Comments (0) |

November 7, 2010

A Texas Legend

The late, great Roy Orbison on Dutch television in 1964.

Posted by Tom at 12:01 AM | Comments (1) |

November 6, 2010

Autumn Golf in The Woodlands

A photo tour during the wonderful Texas autumn to parts of four of the seven golf courses in The Woodlands, Texas. You can download a high resolution version of the slideshow here.

Posted by Tom at 12:01 AM | Comments (3) |

November 5, 2010

The Cancer Sleeper Cell

The state of cancer research is a frequent topic on this blog (for example, here, here and here), so this NY Times excerpt from Columbia oncologist Siddhartha Mukherjee's new book - Emperor of All Maladies: A Biography of Cancer (Scribner November 16, 2010) - caught my eye. It's well worth a read:

Why does cancer relapse?  .  .   . when a cancer disappears on a CT scan or becomes otherwise undetectable, we genuinely begin to believe that the disappearance is real, or even permanent, even though statistical reasoning might suggest the opposite. A resurrection implies a previous burial. Cancer's "relapse" thus implies a belief that the disease was once truly dead.

But what if my patient's cancer had never actually died, despite its invisibility on all scans and tests? .  .  .

In fact, this view of cancer - as tenaciously persistent and able to regenerate after apparently disappearing - has come to occupy the very center of cancer biology. Intriguingly, for some cancers, this regenerative power appears to be driven by a specific cell type lurking within the cancer that is capable of dormancy, growth and infinite regeneration - a cancer "stem cell." [.  .  .]

But if tumors contain dedicated stem cells, then delivering maximal doses of poisons to kill the bulk of the tumor might achieve one response - a shrinkage of the tumor - but have no effect on relapse. If the rare stem cell lurking within a tumor somehow escapes death, then it will reassert itself and grow again. Cancers will come back like a garden that has been cleared by hacking at its weeds while leaving the roots behind. [.  .  .]

If such a phoenix-like cell truly exists within cancer, the implication for cancer therapy will be enormous: this cell might be the ultimate determinant of relapse. For decades, scientists have wondered if the efforts to treat certain cancers have stalled because we haven't yet found the right kind of drug. But the notion that cancers contain stem cells might radically redirect our efforts to develop anticancer drugs. Is it possible that the quest to treat cancer has also stalled because we haven't even found the right kind of cell?

Posted by Tom at 12:01 AM | Comments (2) |

November 4, 2010

The politics of increasing state power

Will Wilkinson touches on an interesting dynamic of current political discourse in the U.S.:

It sometimes does seem as though the American left has more or less ceded the language of liberty to the right.  .   .   . Why is that?

I think "the left's confusion over how to respond ideologically" to the right's libertarian-sounding arguments flows in part from the left's own confusion about what it stands for. If the contemporary right is an uneasy fusion of conservative and libertarian articles of faith, the contemporary left is an uneasy fusion of technocratic progressive and liberal-democratic conviction.

One sees progressive managerial elitism most clearly in the left's public-health and environmental paternalism. The rarely uttered idea is that the people who know best need to force the rest of us to do what's good for us. Whatever you think of this sort of state paternalism, it isn't liberal or liberty-enhancing in any non-tortured sense. The progressive technocrat's attitude toward liberty is: "Trust us. You're better off without so much of it."

The more the left is inclined to stick up for this sort of "activist government" as a progressive, humanitarian force, the less it is inclined to couch its arguments in terms of liberty. And that's just honest. More honest, I would add, than social conservatives who in one breath praise liberty and in the next demand the state imposition of their favourite flavour of morality.

I agree with [Peter] Beinart that engaging the right's worries about liberty by couching the left's agenda in the language of liberty would improve the Democrats' prospects. But I don't think he should discount the extent to which a consistently liberal philosophy of government clashes with cherished and deep-seated parts of the American left's identity. (For example, the part that insists on defending Woodrow Wilson despite the profound depths of his illiberalism.)

Those Americans currently agitated about the threat Democrats pose to liberty are not wrong to be worried. Where they go wrong is in thinking Republicans are better on this score. Democrats might be able to argue this point effectively if only their own commitment to liberty was less conflicted.

The inclination of both major political parties to increase state power has ominous implications for citizens. Is it possible to change?

Posted by Tom at 12:01 AM | Comments (3) |

November 3, 2010

Tablet Tales

More on the Samsung Galaxy Tab here.

Posted by Tom at 12:01 AM | Comments (0) |

November 2, 2010

There is more than one way to skin a cat

At least that's the case when it comes to getting around dubious drug prohibition policies. Check out this WSJ article:

When the housing market crashed in 2008, David Llewellyn's construction business went with it. Casting around for a new gig, he decided to commercialize something he'd long done as a hobby: making drugs.

But the 49-year-old Scotsman didn't go into the illegal drug trade. Instead, he entered the so-called "legal high" business-a burgeoning industry producing new psychoactive powders and pills that are marketed as "not for human consumption."

Mr. Llewellyn, a self-described former crack addict, started out making mephedrone, a stimulant also known as Meow Meow that was already popular with the European clubbing set. Once governments began banning it earlier this year, Mr. Llewellyn and a chemistry-savvy partner started selling something they dubbed Nopaine-a stimulant they concocted by tweaking the molecular structure of the attention-deficit drug Ritalin. [.  .  .]

Mr. Llewellyn is part of a wave of laboratory-adept European entrepreneurs who see gold in the gray zone between legal and illegal drugs. They pose a stiff challenge for European law-enforcement, which is struggling to keep up with all the new concoctions. Last year, 24 new "psychoactive substances" were identified in Europe, almost double the number reported in 2008,  .  .  .

Particularly interesting is Mr. Llewellyn's "foolproof" safety testing method for new drugs:

[Mr. Llewellyn] boasts that his safety testing method is foolproof: He and several colleagues sit in a room and take a new product "almost to overdose levels" to see what happens. "We'll all sit with a pen and a pad, some good music on, and one person who's straight who's watching everything," he says.

Posted by Tom at 12:01 AM | Comments (0) |

November 1, 2010

Will justice be done in Jeff Skilling’s case?

Oral argument before a Fifth Circuit Court of Appeals panel in Houston occurs today on the U.S. Supreme Court's reversal and remand of former Enron CEO Jeff Skilling's appeal of his criminal conviction.

Although the Supreme Court did not overturn all counts of Skilling's conviction, it remanded the remaining counts to the Fifth Circuit to determine whether any of them should stand given the Supreme Court's reversal of the other counts based on the invalid "honest services" wire fraud charges.

In essence, Skilling is arguing on remand that the government relied on the amorphous nature of that invalid theory of criminality in obtaining a conviction against him on numerous different charges. Having relied on that invalid theory of criminality, Skilling contends that the government cannot now prove that the jury didn't rely on it in convicting Skilling on the other charges, too. Although results rarely occur as they should in misdirected criminal prosecutions, Skilling really should win his release and a re-trial.

Meanwhile, rather than address the merits of Skilling's important case, the Wall Street Journal - which already has a dubious record of coverage in Enron-related criminal prosecutions - serves up the following characterization of the Enron-related prosecutions in this recent article on another miscarriage of justice related to the demise of Enron:

The U.S. government's Enron Task Force criminally charged about 30 individuals, including Mr. Brown, but said there were more than 100 other unindicted co-conspirators. The task force got guilty pleas from more than a dozen people and won a 2006 fraud conviction against former Enron President Jeffrey Skilling.

Some of the group's courtroom victories have been upended on appeal. Mr. Skilling's conviction and 24-year sentence are under appeals-court review following a Supreme Court decision invalidating part of his case.

"Some of the [Enron Task Force's] courtroom victories have been upended on appeal"? In reality, not any of the criminal convictions that the Enron Task Force obtained after a trial have been upheld on appeal. Not one.

Seems like something that the nation's leading business newspaper would get right, don't you think?

Posted by Tom at 12:01 AM | Comments (1) |

October 31, 2010

Time for a little Thriller

In observance of Halloween, one of my wife's favorite cinematic dance scenes.

Posted by Tom at 12:01 AM | Comments (2) |

October 30, 2010

Security theater run amok

Security theater --  that is, the largely worthless waste of time that the federal government imposes on us in the security lines at our nation's airports - has been a frequent topic on this blog. Arguably, no other current governmental action represents better just how out of control our government has become from the true desires of its citizens.

Given what appears initially to be some unsophisticated attempts at terrorist attacks on Thursday, we will likely in the coming days be regaled with the additional measures that the TSA will propose to impose on us as a result of this latest security threat.

Meanwhile, as this Jeffrey Goldberg/The Atlantic article notes, the federal government will continue to ignore the much more serious violations of civil liberties and basic human decency that already take place daily in our airports.

When will this madness end?

In this recent TEDxPSU talk, security expert Bruce Schneier provides an overview on how we should reconceptualize security so as to address the true security threats in an effective and reasonable manner. More constructive thought goes into this 18-minute lecture than what went into constructing the entire federal government elaborate security theater apparatus.

Posted by Tom at 12:01 AM | Comments (2) |

October 29, 2010

Norah Jones covers Wilco’s “Jesus, Etc.”

Is there any song that Norah Jones does not cover well?

Posted by Tom at 12:01 AM | Comments (0) |

October 28, 2010

Rationalizing Misery

The title of this post refers to the thought process of the folks described in this New York Magazine article who are obsessed with following a severe calorie restriction diet.

And as if that isn't bad enough, this NY Times article reports on the large number of 40-somethings who are consumed with training and competing in triathlons. The article points out that some of the participants got into triathlons because their bodies were already breaking down under the stress of long-distance running!

What is utterly lacking in the lives of all the people described in these two articles is any sense of balance. Rather than eating a sensible and balanced diet, calorie restriction advocates deprive themselves in the hope that it will increase their lives for a few years. Maybe so, but how fulfilling is that extended life if one does not consume enough food to maintain a livable level of lean body mass?

Meanwhile, the triathletes punish themselves training under the delusion that more exercise is always better for their health. They ignore the substantial research that indicates that adequate rest and recovery after exercise is just as important for good health as the exercise itself.

What is it about life in America in 2010 that provokes people to do such things to themselves?

Posted by Tom at 12:01 AM | Comments (6) |

October 27, 2010

Insulating Delusion

This NY Times story on long-distance runners and medical insurers provides a case study on why productive reform of the U.S. health care finance sector so difficult.

As noted many times on this blog, long-distance running is not healthy. Thus, as the article notes, medical insurers are beginning to balk at insuring long-distance runners.

However, the myth that long-distance running is healthy remains firmly implanted in the American psyche. So, the medical insurers - not wanting to be perceived as refusing to cover injuries resulting from supposedly healthy activity - are trying to figure out ways to cover the runners.

And, of course, Obamacare is going to require that insurers cover consumers who engage in injury-causing activities.

Meanwhile, the runners delude themselves that they are engaging in a healthy activity while advocating that insurers essentially provide them insulation (rather than real insurance) from the cost of dealing with the unhealthy effects of their activity.

Don't get me wrong. Folks should be able to enjoy long-distance running as either exercise or a recreational activity (those are two different things, but that's for another post). My anecdotal observation is that most runners don't actually appear to enjoy the activity -- the delusion that the benefits of long-distance running outweigh the costs apparently pushes them through the displeasure.

But if folks elect to take the risk of injury from long-distance running, then they should have to bear the cost of at least the non-catastrophic damages resulting from that risk. And insurers should be free to elect not to cover consumers who engage in such risky behavior. Shifting the cost of that risk to insurers (who pass it along to the rest of us) simply encourages runners to avoid confronting the myth that they are engaging in healthy activity.

As the late Milton Friedman was fond of saying, consumers will consume as much health care as they can so long as someone else is paying for it.

Posted by Tom at 12:01 AM | Comments (1) |

October 26, 2010

The other side of the White House White Board

Very interesting (H/T Greg Mankiw).

Posted by Tom at 12:01 AM | Comments (1) |

October 25, 2010

The ER Doc as Primary Care Physician

One of the numerous inefficiencies of the American health care finance system is that hospitals have been forced to pay high compensation to attract doctors into emergency room care.

The primary reason for this has been that many uninsured and underinsured consumers use the ER for non-emergency medical matters that would be better and more efficiently handled by an internist or family practitioner in their private office. This disturbing trend has been growing for many years and likely will be made even worse by Obamacare.

Turns out that the ER doc-as-primary-care-physician is also having some unintended consequences with regard to patients, as related by an internist/hospitalist friend of mine:

So, I get a call from the ER today - new doc fresh out of the ER training program tells me she has a patient there she wants me to admit for a cardiac workup.

Says that the patient has a history of "heart problems" and that the patient said that she was having chest pain "just like before my bypass."

So, I go down to the ER - I look at the patient's chart and note that her primary complaint when she arrived there was fever and vomiting.  I note that her cardiac evaluation so far was normal.  I looked at her EKG - normal.  I pulled up her chest x-ray - normal. And no sign of any telltale median sternotomy wires that are standard post-CABG.  Hmm...

So, I go in to talk to the patient.  She tells me that she has "chest pain," and epigastric pain, and fever, and chills, and nausea, and vomiting. I examine her and note that there is no CABG scar on her chest.  Hmm....

So, I ask her, "Tell me about your bypass."

"You mean my gastric bypass?"

Turns out she never has had any heart problems.

Turns out she had a cardiac cath 15 months ago before her gastric surgery - stone cold normal.

Turns out the ER doc stopped listening as soon as she heard "chest pain" and "bypass."

So, I put her in the hospital to treat her viral gastroenteritis with IV fluids and nausea meds.  And I will sent her home in the morning, feeling all better.

And I take solace in the fact that ER docs are paid at least 50% more than I am.

Well, not really, about the solace thing, that is .  .  .

To make matters worse, in previous times, the ER doctor's superiors would have castigated her for her stupidity and intellectual laziness.  However, if that were to occur today, each of the doctors criticizing the ER doc would probably be labeled as a "disruptive physician" and referred to a series of sensitivity counseling sessions.

This is not going to turn out well.

Posted by Tom at 12:01 AM | Comments (1) |

October 24, 2010

“Stop it”

Bob Newhart provides his hilarious version of cognitive behavioral therapy.

Posted by Tom at 12:01 AM | Comments (1) |

October 23, 2010

Jetting through the Grand Canyon

Check out this cool video.

Posted by Tom at 12:00 AM | Comments (0) |

October 22, 2010

“You’re not Chinese?”

Classic Seinfeld.

Posted by Tom at 12:01 AM | Comments (0) |

October 21, 2010

Who is afraid of Anonymous Political Speech?

Posted by Tom at 12:01 AM | Comments (0) |

October 20, 2010

Lies, Damned Lies and Medical Science

It's hard to beat that title of this interesting David H. Freedman/The Atlantic article (H/T John Goodman) about medical researcher, John Ioannidis, who has made a name for himself establishing that most medical information that physicians commonly rely upon is largely flawed:

.  .  . can any medical-research studies be trusted?

That question has been central to Ioannidis's career. He's what's known as a meta-researcher, and he's become one of the world's foremost experts on the credibility of medical research. He and his team have shown, again and again, and in many different ways, that much of what biomedical researchers conclude in published studies-conclusions that doctors keep in mind when they prescribe antibiotics or blood-pressure medication, or when they advise us to consume more fiber or less meat, or when they recommend surgery for heart disease or back pain-is misleading, exaggerated, and often flat-out wrong. He charges that as much as 90 percent of the published medical information that doctors rely on is flawed.

His work has been widely accepted by the medical community; it has been published in the field's top journals, where it is heavily cited; and he is a big draw at conferences. Given this exposure, and the fact that his work broadly targets everyone else's work in medicine, as well as everything that physicians do and all the health advice we get, Ioannidis may be one of the most influential scientists alive. Yet for all his influence, he worries that the field of medical research is so pervasively flawed, and so riddled with conflicts of interest, that it might be chronically resistant to change-or even to publicly admitting that there's a problem. [.  .  .]

We could solve much of the wrongness problem, Ioannidis says, if the world simply stopped expecting scientists to be right. That's because being wrong in science is fine, and even necessary-as long as scientists recognize that they blew it, report their mistake openly instead of disguising it as a success, and then move on to the next thing, until they come up with the very occasional genuine breakthrough. But as long as careers remain contingent on producing a stream of research that's dressed up to seem more right than it is, scientists will keep delivering exactly that.

"Science is a noble endeavor, but it's also a low-yield endeavor," he says. "I'm not sure that more than a very small percentage of medical research is ever likely to lead to major improvements in clinical outcomes and quality of life. We should be very comfortable with that fact."

Posted by Tom at 12:01 AM | Comments (2) |

October 19, 2010

Metro, Proposition 1 and competing costs

Given the regularity of gully-washers in Houston, flood control is something near and dear to the heart of any Houstonian.

So, the Renew Houston organization reasons, who could possibly be against Proposition 1 in the upcoming election? That's the referendum that seeks to raise about $8 billion of dedicated taxes over the next couple of decades to fund flood control projects and other infrastructure improvements.

Well, I doubt many Houstonians oppose improving flood control and other reasonable infrastructure improvements. But reasonable folks can certainly differ over how to pay for it. And more precisely, whether local governments have already committed limited tax dollars to boondoggles such as the Metro light rail system that should have been used for the more beneficial projects that Proposition 1 proposes.

Metro's defenders - many of whom are supporters of Proposition 1 - typically rely on the 2003 referendum as the primary basis for their continued support of the light rail boondoggle. But the problem with the 2003 referendum and Proposition 1 is that they ask voters to approve large public projects in a vacuum while ignoring Peter Gordon's three elegantly simple questions regarding economic choices: 1) At what cost? 2) Compared to what? and 3) How do you know?

For example, let's assume that voters in 2003 had been informed that the expenditure of a billion or so of public money on building a lightly-used light rail system has real consequences, such as leaving inadequate funds available to make the improvements to Houston's flood control system and infrastructure that Proposition 1 now proposes.

No one knows for sure, but my bet is that voting results would have been dramatically different if the foregoing alternative had been a part of the 2003 referendum.

Unfortunately, the relatively small groups that benefit from urban boondoggles have a vested interest in preventing the voters from ever examining those threshold issues. The primary economic benefit of such public projects is highly concentrated in only a few interest groups, such as representatives of minority communities who tout the political accomplishment of shiny toy rail lines while ignoring their constituents need for more effective mass transit; environmental groups striving for political influence; engineering and construction-related firms that profit from the huge expenditure of public funds; and real-estate developers who profit from the value enhancement provided to their property from the public expenditures.

As Professor Gordon wryly-noted "It adds up to a winning coalition."

Unfortunately, once such coalitions are successful in establishing a governmental policy subsidizing boondoggles such as the Metro light rail system, it is virtually impossible to end the public subsidy of the boondoggle and deploy the resources for more beneficial projects.

How do these interest groups get away with this? The costs of such boondoggles are widely dispersed among the local population of an area such as Houston, so the many who stand to lose will lose only a little while the few who stand to gain will gain a lot. As a result, these small interest groups recognize that it is usually not worth the relatively small cost per taxpayer for most citizens to spend any substantial amount of time or money lobbying or simply taking the time to vote against a boondoggle such as a light rail system.

But would the citizenry react differently if they knew that their lack of action in the face of an urban boondoggle might prevent the funding of much more beneficial projects?

Writing about Phoenix's new light rail system, which is just as uneconomic as Houston's, Warren Meyer analogizes the funding of these systems to dubious household purchases:

[The] Phoenix light rail reminds me of a home I visited recently that had a $50,000 super-size 100-inch flat screen TV.  That TV was gorgeous.  Everyone who saw it immediately fell in love with it.  It worked flawlessly, and everyone at the party wanted one. In fact, it was probably the greatest, most sensible and successful purchase of all time .   .   . as long as one never considered the cost.  This is exactly how light rail seems to get evaluated.

In building a light rail system, did Houston buy an expensive flat-screen TV with funds that would have been better utilized taking care of the drainage problem in the back yard? Or are things going so well at work for Houston that it can do both?

We will soon find out.

Posted by Tom at 12:01 AM | Comments (0) |

October 18, 2010

A good way to start the work week

The genius of Tina Fey - the best of Liz Lemon.

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October 17, 2010

Ben Crane’s Workout

Who would have thought that Ben Crane is the PGA Tour's budding comedian?

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October 16, 2010

Joan Sutherland, R.I.P.

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October 15, 2010

Sweet Swing

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October 14, 2010

The Most Important Golf Courses

If you are interested in golf, don't miss this Golf Digest 60th Anniversary article (slideshow here) on the most important American golf courses of the past 130 years.

Organized by decade, the list only includes a few Texas courses, including Houston's venerable Champions Golf Club.

Given the dire financial condition of many courses these days in the face of a soft golf market, Golf Digest chose one old course in Florida as a lesson in real estate development that is frequently forgotten:

Whitfield Country Club, a residential development in Sarasota, Fla., was built in the mid-1920s by Donald Ross, the country's premier course architect. To sell memberships and home sites, Whitfield's developers hired the great amateur player Bobby Jones as spokesman. And yet Whitfield failed within a year, a victim of Florida's real-estate bust that struck well in advance of the stock-market crash. Whitfield proved that even a marquee designer and a celebrity endorser don't guarantee success, a lesson with resonance even now.  .   .   .

Posted by Tom at 12:01 AM | Comments (0) |

October 13, 2010

The collateral consequences of overcriminalization

The troubling overcriminalization of American life has been a frequent topic on this blog, but this Jack Chin/Balkanization post explores an underappreciated cost of the overcriminalization policy - the collateral consequences of a criminal conviction:

Conviction and punishment, it is said, are the ways defendants "pay their debt to society." But it turns out that criminal conviction is a debt that can never be paid. In every state and under federal law, there are hundreds of collateral consequences that apply automatically or on a discretionary basis, to people convicted of crimes. Most of these apply for life, apply based on convictions from other jurisdictions, and can never be removed, or can be relieved only through virtually unavailable methods like a pardon from the President. The rise of computer databases means that factual disclosure of convictions is inescapable.

These collateral consequences, depending on the crime, include such things as deportation for non-citizens, ineligibility for public benefits, and government licenses, permits, and public employment, ineligibility for private employment requiring security clearances or contact with vulnerable populations like children and the elderly, loss of civil rights like voting, office-holding and jury service, and loss of parental rights or ability to adopt or be a foster parent.

These collateral consequences are particularly harsh on the young, many of whom believe that they will never be able to overcome the adverse impact of a youthful indiscretion.

In short, the collateral consequences of our federal, state and local governments' overcriminalization policy inhibits hope. How does that make sense?

Posted by Tom at 12:01 AM | Comments (1) |

October 12, 2010

Continuous Chest Compression CPR

Check out the University of Arizona College of Medicine's well-done video and discussion (see also here) of a new approach to CPR.

Posted by Tom at 12:01 AM | Comments (0) |

October 11, 2010

DeVany’s Top Ten Reasons Not to Run Marathons

The Chicago Marathon was over this past weekend, which resulted in the typical dozens of hospitalizations of participants.

That reminds me to pass along health and nutrition expert Art DeVany's top 10 reasons not to run marathons (here is a previous post on the risks of long-distance running). Art's summary of each reason is below, but you will have to subscribe to Art's insightful site on fitness, health, aging nuturion and exercise to read Art's elaboration on each reason:

10. Marathon running damages the liver and gall bladder and alters biochemical markers adversely. HDL is lowered, LDL is increased, Red blood cell counts and white blood cell counts fall. The liver is damaged and gall bladder function is decreased. Testosterone decreases.

9. Marathon running causes acute and severe muscle damage. Repetitive injury causes infiltration of collagen (connective tissue) into muscle fibers.

8. Marathon running induces kidney disfunction (renal abnormalities).

7. Marathon running causes acute microthrombosis in the vascular system.

6. Marathon running elevates markers of cancer. S100beta is one of these markers. Tumor necrosis factor, TNF-alpha, is another.

5. Marathon running damages your brain. The damage resembles acute brain trauma. Marathon runners have elevated S100beta, a marker of brain damage and blood brain barrier dysfunction. There is S100beta again, a marker of cancer and of brain damage.

4. Marathons damage your heart. From Whyte, et al Med Sci Sports Exerc, 2001 May, 33 (5) 850-1, "Echocardiographic studies report cardiac dysfunction following ultra-endurance exercise in trained individuals. Ironman and half-Ironman competition resulted in reversible abnormalities in resting left ventricular diastolic and systolic function. Results suggest that myocardial damage may be, in part, responsible for cardiac dysfunction, although the mechanisms responsible for this cardiac damage remain to be fully elucidated."

3. Endurance athletes have more spine degeneration.

The number two reason not to run marathons:

2. At least four particiants of the Boston Marathon have died of brain cancer in the past 10 years. Purely anecdotal, but consistent with the elevated S100beta counts and TKN-alpha measures. Perhaps also connected to the microthrombi of the endothelium found in marathoners.

And now ladies and gentlemen the number one reason not to run marathons:

1. The first marathon runner, Phidippides, collapsed and died at the finish of his race. [Jaworski, Curr Sports Med Rep. 1005 June; 4 (3), 137-43.]

Now there is a recommendation for a healthy activity. The original participant died in the event. But, this is not quite so unusual; many of the running and nutritional gurus of the past decade or two died rather young. Pritikin, Sheehy, Fixx, and Atkins, among many other originators of "healthy" practices died at comparatively young ages. Jack LaLanne, the only well-known guru to advocate body building, will outlive us all.

Posted by Tom at 12:01 AM | Comments (1) |

October 10, 2010

Hogan’s Swing

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October 9, 2010

Golf on an October Texas Morning

It's hard to beat the weather in Texas during Autumn when the oppressive heat of Summer gives way to delightfully cool mornings and warm days.

Here is a slideshow of photos (music by Alison Krauss and Robert Plant, Through the Morning, Through the Night) that I took during a recent early-morning round at the Tournament Course at The Woodlands, which is in great shape preparing to host the Administaff Small Business Classic Champions Tour tournament the weekend after next. You can download a high resolution version of the slideshow here and a prior slideshow of the course during the dormancy of winter is here.

A very nice walk in the park indeed.

Posted by Tom at 12:01 AM | Comments (1) |

October 8, 2010

Liz Lemon Flashbacks

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October 7, 2010

Good Police Work

H/T Radley Balko.

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October 6, 2010

An entertaining form of corruption

As I've noted many times over the years, big-time college football is an entertaining form of corruption, but corruption nonetheless.

Several recent articles reminded me of this corruption and the almost pathological obsession of the mainstream media to avoid addressing it, particularly during the highly entertaining football season.

First, there was this Joe Draper/NY Times article on how the highly valuable Big Ten Network is changing the financial landscape of college sports. Not once is it mentioned in the article that the people who are actually creating most of that value - i.e., the young athletes - are forced to compete under a system of highly-restricted compensation while some bastions of higher learning profit from the value that they create. In their honest moments, how do the academics rationalize that sort of exploitation, particularly when much of it involves undereducated, young black men?

Meanwhile, this breathless Pete Thamel/NY Times article reports on how the regulator of this corruption - the NCAA - is really cracking down now on coaches who have the audacity of attempting to provide to the athletes a pittance of the compensation that the bastions of higher education are preventing them from receiving. Not once in the article is it mentioned that the system is exploiting these athletes for the benefit of the NCAA and its member institutions.

Finally, this William Winslade-Daniel Goldberg/Houston Chronicle op-ed thoughtfully points out the ethical issues that arise as a result of exposing young athletes to serious and often undisclosed risk of injury and loss of potential future compensation.

So, what is it about football that generates such cognitive dissonance when young professional athletes in other sports such as golf, tennis, and baseball are not subjected to such arbitrary restrictions in compensation?

Are we concerned that the sacred traditions of college football might change if the current system is altered to compensate the young athletes fairly for the risks that they take and the wealth they create? Are those traditions truly worth the perpetuation of such a parasitic system?

There is nothing inherently wrong with universities being involved in the promotion of professional minor league football if university leaders conclude that that such an investment is good for the promotion of the school and the academic environment. Allow the players who create wealth for the university to be paid directly, allow the universities to establish farm team agreements with NFL teams, and cut out the hypocritical incentives that are built into the current system.

Not only would such a system be fairer for the players who take substantial risk of injury in creating wealth for the universities, it would obviate the compromising of academic integrity that universities commonly endure under the current system.

So, why are the leaders of our institutions of higher learning not leading the way toward a fairer system?

Perhaps they really are not leaders at all?

Posted by Tom at 12:01 AM | Comments (7) |

October 5, 2010

Patient expectations and Doctor ratings

Regular readers of this blog know about my opposition to the now entrenched third party payor process of even routine health care costs in the U.S. health care finance system.

Removing the consumer from controlling the complex decisions that go into paying or attempting to avoid such costs has had far-reaching consequences, not only on the cost of health care, but also on the way in which consumers view their responsibility in regard to maintaining their own health.

I was reminded of those implications recently when I came across this Pauline Chen/NY Times article on the vagaries of third party payors compensating doctors based on patient performance, and this Happy Hospitalist post on the difficulty of telling a patient who is expecting a cure regardless of the cost that the doctor really doesn't know what's wrong with with the patient.

These items prompted a friend of mine - first-rate hospitalist and internist - to pass along his experience on the unrealistic expectations of many patients:

Here is an insight into what the practice of medicine has evolved into.

Because hospitals and other corporate organizations are so focused on "customer satisfaction" these days (with Press-Gainey satisfaction survey scores and the like), the opinions of persons like the one the Happy Hospitalist describes get far more purchase than they have in the past.

Often times, I see drug-seeking persons like this get all the testing and all the Dilaudid they want (bad medical practice on multiple levels) because a doctor may not want to set himself up to get "dinged" on a patient survey - some places tie physician bonuses to patient satisfaction scores - some docs even get fired for bad scores.

And, unfortunately, patients like this are not a rare occurrence.  I see at least one or two every week I work in the hospital. 

I had a patient tell me, "Screw you" last month when I suggested that she might have a bit more money for medicines if she were to stop smoking two packs of cigarettes per day. This is after I had admitted her for treatment of accelerated hypertension and uncontrolled diabetes, found her previously undiagnosed high cholesterol, and got those all under control with medications she could get through the WalMart $4 program. There was no "thank you", and certainly no payment to me or to the hospital for our expertise.

It's really disappointing to see how frequently the patient-physician interaction has deteriorated into something like this.  I guess that other professions are subject to similar abuse, but I don't see any other examples as severe as what I am seeing in medicine.

I've always thought that the best approach is to do what's right for the patient, even if it is not necessarily what the patient wants.  In this current climate, this has at times put me at odds with hospital administration.

What do you think Walt [my late father] would do if faced with this deterioration of patient-physician interaction?

I think my father's reaction would be the following:

1. When you remove from the patient the responsibility to pay - or at least contributing to pay -- for their health care, patients tend not only to become more irresponsible regarding how they spend money for their health care, but also less interested in understanding how to avoid those costs.

2. Doctors share a big part of the blame for the foregoing problem because they encouraged (and previously got rich by) over-billing of third party payors who insulated the consumer from the cost of health care. Now those chickens are coming home to roost.

I continue to believe that the solution to these problems is not by adding complexity to the health care finance system. Rather, take away insulation of routine health care costs and require consumers to pay those costs, allow insurers to provide true insurance for catastrophic illness or injury and use government as a reinsurer of true health insurance and an insurer of last resort for folks who cannot afford health care or private insurance. Allow such a system to develop over a generation or two and we might bring some semblance of consumer education and price stability through market forces back to the health care finance system.

But I'm not counting on it.

Posted by Tom at 12:01 AM | Comments (2) |

October 4, 2010

The difficulty of being right

This Kathryn Schulz/The Wrong Stuff blog post provides an insightful interview with clinical researcher Barry Marshall, the 2005 Nobel Prize winner who, along with colleague Robin Warren, proved that up to 90 percent of peptic ulcers are caused by a bacterium and not by stress as medical "wisdom" had long held.

The entire interview is interesting, but the most fascinating part is where Dr. Marshall explains the difficulty of attempting to persuade the scientific establishment to abandon the conventional wisdom about ulcers even when he could provide clinical evidence that the conventional wisdom was wrong. As with much of the progress in medical research over the past 50 years, Marshall's breakthrough in changing the conventional wisdom emanated from Houston:

When and how did you start to convince people?

Part of it had to do with David Graham, who was chief of medicine at [Baylor College of Medicine], in [Houston] Texas, and a thought leader in gastroenterology. Graham started off as a real skeptic but quickly turned around. To his credit, Graham never said that I was wrong. He said, "I don't know, and I'm going to find out." And a couple of years later, he said, "I've checked it out and it looks pretty good, it looks like it could be true."

And then in 1993 or '94, the NIH had a consensus conference, and Tachi Yamada summed it up. Yamada is currently the head of [the Global Health Program of] the Gates Foundation; he's a very, very smart guy, and he said, "Looks like it's proven: Bacteria cause ulcers, and everybody needs to start treating ulcers with antibiotics."

It was just like night and day after that. The whole thing just went ballistic.

So, why do we cling to conventional wisdom even in the face of compelling evidence to the contrary? Is embracing the truth not as important as being comfortable with the beliefs - regardless of whether they are right -- of what we want to be the truth or what those we live with believe is true? 

Posted by Tom at 12:01 AM | Comments (2) |

October 3, 2010

Austin City Limits, 35 Years of Photos

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October 2, 2010

Pepsi Cindy

In our ongoing series of innovative commercials, Cindy Crawford reminds us of how good those old Pepsi commercials were.

Posted by Tom at 12:01 AM | Comments (0) |

October 1, 2010

A fascinating season so far, Part III

Finally, over on Cullen Avenue, the University of Houston has endured the most disheartening start of the college football season. But with that disappointment comes a fascinating challenge.

The disappointment is the college career-ending injury to QB Case Keenum, who had one of the best seasons in college football history last season and who was primed to improve on that performance this season.

After directing UH to two easy wins against overmatched opponents, Keenum blew out a knee attempting to make a tackle in the third game against UCLA and - "Poof" - the collegiate career of one of the best college QB's of this era was ended.

To make matters worse, a hard-hitting UCLA defense subsequently ended the career of Keenum's backup - Chase Turner - about a quarter later. That leaves a good UH team with no experienced QB going into the meat of their schedule, which is not remotely where the Cougars expected to be after four games this season.

In addition to being a fine young man and a team leader, what made Keenum so much fun to watch was his uncanny field presence. He was literally a coach on the field during the game.

UH opponents often dropped eight defenders into coverage in an attempt to slow down the Cougars' high-flying passing attack, so Keenum simply checked-off at the line of scrimmage and unleashed Houston's formidable rushing attack. Then, when opposition defenders crept closer to the line to stop the run, Keenum scorched them with quick-hitting passes to over a half-dozen different receivers.

With a quick release, excellent reading skills and a commanding field presence, Keenum may be that special combination of talent - similar to Drew Brees - who can overcome physical limitations (he is just a bit over 6 feet tall) to make it in the NFL. Everyone in Houston will certainly be pulling for him.

But aside from Keenum's future, there is an interesting subplot arising from the Cougars' troubled start.

Cougars head coach Kevin Sumlin - one of the top up-and-coming coaches in the college game - now faces the toughest challenge of his three year head coaching career.

That's not to suggest Sumlin hasn't faced difficult challenges before. In his first season as UH coach (2008), he somehow kept his team and coaching staff together when Hurricane Ike pummeled the Houston area and a clueless UH athletic administration inexplicably forced the Cougars coaching staff and players to play two road games while their families were dealing with the difficult aftermath of that devastation.

After enduring that, Sumlin gamely guided the Cougars to a successful season and their first bowl victory in almost 30 years, primarily on the back of Keenum and Sumlin's innovative variation of the Spread offense. Sumlin's scheme continued UH's legacy of being an incubator for creative football offenses that began with Bill Yeoman's Veer 50 years ago, then Jack Pardee and John Jenkins' version of the Run n' Shoot in the late 1980's and early 90's, and more recently, Art Briles' idiosyncratic version of the Spread.

Houston's successful campaign in Sumlin's first season set the stage for last season's even better UH team that was one of the best non-BCS teams in the nation. The Coogs beat three teams from BCS conferences, two of which (Texas Tech and Oklahoma State) ended up in post-season bowl games. Even though the season ended on down note with a close loss in the CUSA championship game and a dispiriting loss in a meaningless bowl game, Sumlin had reason to expect big things this season with Keenum and many other offensive stars returning.

Alas, with Keenum's injury, those high expectations have been downsized considerably. Sumlin and the Cougars now must face the remainder of their schedule with two true freshman QB's, Terrance Broadway of Baton Rouge and David Piland from the Southlake Carroll QB factory near Dallas.

Broadway got the nod in UH's first post-Keenum game this past Saturday against Tulane and the results were about what you would expect from a freshman making his first collegiate start. Broadway generated about a third of Keenum's usual production and had three turnovers in a 42-23 Cougar victory over a team that would probably rank about 110th out of the 120 major college teams.

To make matters worse, UH's schedule gets much tougher quickly with SEC opponent Mississippi State coming to town next Saturday. In fact, the Cougars will probably be favored to win only two (Rice and Memphis) of their remaining eight games.

Thus, the Cougars have gone quickly from the expectation of a 10+ win season to one in which four or five wins is a distinct possibility if their freshman QB's struggle. Moreover, Sumlin was already dealing with other issues before the injury to Keenum.

For example, Sumlin is in the initial season of working with a rearranged coaching staff. After losing talented offensive coordinator Dana Holgorsen to Oklahoma State after last season, Sumlin decided to replace his defensive coordinator, John Skladany, who specialized in coaching up undermanned defenses such as the one that Sumlin inherited at UH from the Art Briles coaching staff.

Although Sumlin's replacements are all experienced coaches (Jason Phillips and Kliff Kinsbury on the offensive side, Brian Stewart on defense), Sumlin must now also replace an effective on-field coach in Keenum with an inexperienced freshman. And three years of recruiting defensive players and the hiring of Stewart has not yet produced any better defensive performance than what Skladany generated for the Cougars with inferior talent to what the Coogs have on defense now.

Accordingly, it's reasonable to ask whether there is any hope for the Cougars this season?

Well, except for the UCLA debacle, the Coogs' offensive line has played capably in the first four games. As a result, the Cougars RB tandem of Bryce Beall and Michael Hayes has been quite effective. Moreover, Houston's receivers - who also man the Cougars' formidable kickoff and punt return positions - remain one of the fastest and most dangerous groups in all of college football. And maybe, just maybe, the Cougars defense will finally start to realize some of the potential that Sumlin and his staff have recruited over the past three years.

So, the Cougars are not without weapons. But without an experienced triggerman, will Sumlin be able to figure out a way for the Cougars to harness those weapons effectively?

The answer to that question may well be the defining moment in Kevin Sumlin's bright coaching future. Yet another reason why this football season is shaping up as one of the most interesting in years.

Posted by Tom at 12:01 AM | Comments (0) |

September 30, 2010

A fascinating season so far, Part II

Meanwhile, this week before the annual Texas-OU weekend, there is more than the usual trepidation in Longhorn circles over the big game.

Most of the concern results from the hammering that the Longhorns took last Saturday to an unheralded but underrated UCLA team. But the seeds of this discontent actually have their root in what appear to be a series of decisions that Mack Brown made after the 2006 National Championship game.

Ever since Vince Young left the UT program, it appears that Brown and his offensive coordinator, the much-maligned Greg Davis, have been attempting to move the Longhorns offensive scheme away from the Spread Zone Read offense in which Young excelled to a pro-style scheme that balances the pass with a power running attack.

Frankly, Brown's decision was not an unreasonable one. Talents such as Young come along only once every generation and the big downside to the Spread is the injury risk that it places on the QB. Texas experienced that risk in spades during the early stages of the last year's National Championship Game when QB Colt McCoy was injured on an ill-conceived option play. McCoy was UT's most effective rusher last season out of the Spread.

Moreover, Brown has been recruiting top defensive talent to Texas for years in large part on the premise that the players will be schooled in an pro-style defense that will prepare them for the NFL. It makes sense that Brown would want to recruit offensive players in the same manner. He can't do that running the Spread, which will likely never be an effective pro offense.

Inasmuch as McCoy replaced Young and was quite comfortable in the Spread, Brown's grand plan was delayed somewhat over the past four seasons. However, particularly last season, it was apparent that Brown and Davis were attempting to implement - with limited success - a more straight ahead power running attack than the the delay and trap blocks that are the hallmark of the Spread.

Now, this season, with sophomore QB Garrett Gilbert at the helm, Brown and Davis began the season firmly committed to implementation of the pro-style attack. However, as the offense sputtered through the first four games, Brown and Davis frantically find themselves trying to integrate the pro-style scheme with the Spread scheme that the players appear to feel more comfortable with. The result has been a mess, punctuated by UCLA shutting down the UT offense completely this past Saturday.

Not exactly the kind of warm and fuzzies that the Longhorn fan base wants to feel leading into this Saturday's showdown with Oklahoma. Or the Horns' next game two weeks later against no. 6 Nebraska, which is still itching from arguably favorable treatment that the Horns received from officials at the end of last year's Big 12 Championship Game.

Inasmuch as Brown pretty much has the pick of the best assistant coaches and the best Texas high school players each season, how does he find himself in this situation?

Well, each football team has an identity, but every football program develops a culture that transcends a particular team's identity. Brown is now attempting to change the offensive line culture at Texas from a Spread blocking unit to a power running unit.

The physical requirements and techniques are considerably different for blocking in the Spread than in an power running scheme. Changing the blocking techniques, the type of lineman recruited and sometimes even the assistant coaches doing the teaching takes time. Texas remains in the process of this cultural shift.

That's why it sometimes appears that Brown and Davis are attempting to place a square peg - i.e., a bunch of Spread blocking offensive linemen - in the round hole of a pro-style power rushing attack. Add to that a group of running backs who are not dominant and before you know it, the Horns are not well-equipped to run either the Spread or a pro-style power rushing scheme.

So, what should UT do?

My sense is that the Horns should play to their strength, which is their defense. Play ball control on offense, limit turnovers, punt well, play excellent special teams and try to win as many games as possible by scores of 17-10 or 20-14. Heck, UT's secondary is so talented that they are probably good for a score a game if the Horns emphasize field position and place the opposition's offense in difficult positions. 

This is clearly a rebuilding year for UT, so a 3-4 loss season is certainly not out of the question. On the other hand, the Longhorn's defense is really good and will keep the Horns in games in which the UT offensive mistakes don't give the opposition too many easy scores.

For example, the Horns are quite capable of beating Oklahoma, which has also struggled during much of its first four games. But the Horns will not beat the Sooners if the Horns' offense and special teams give OU the field position that UCLA enjoyed in the first half last Saturday.

Long term is another issue. Brown and Davis clearly need to re-assess the type of offensive linemen that they are recruiting if they want to complete the cultural shift to a pro-style offense. But even more troubling is that Texas is not attracting the top running back talent anymore -- Texas does not have one of the top five RB's in the Big 12 South on its current roster. Getting back to attracting dominant RB's has a way of making even difficult transitions look better.

Given the Horns and Sooners' problems, this may just be the season that one of these two teams finally wrests control of the Big 12 South title away from the Texas-Oklahoma stranglehold. The Oklahoma State-Texas A&M ESPN Thursday night game tonight should be a highly entertaining affair with yet another interesting subplot.

First-year Oklahoma State offensive coordinator Dana Holgorsen - who helped Kevin Sumlin develop the University of Houston's devastating version of the Spread during the 2008 and 2009 seasons - is pitted once again against first-year Texas A&M defensive coordinator Tim DeRuyter, who was formerly at Air Force. Holgorsen and DeRuyter matched wits during three Houston-Air Force games during the 2008-2009 seasons.

DeRuyter clearly got the better of Holgorsen in their most recent matchup, which was Air Force's decisive 2009 Armed Services Bowl victory when the Falcons forced UH QB Case Keenum into six interceptions and held UH to a relatively paltry 331 yards of total offense.

However, Holgorsen got the better of DeRuyter in the two previous games. One was Houston's 2008 Armed Services Bowl victory when the Cougars rolled up over 400 yards of total offense. The other was the earlier game that season (a 31-28 Air Force win) that UH's clueless athletic administration at the time inexplicably forced the Cougars to play in Dallas while Hurricane Ike was devastating the Houston area. Even with that distraction, Holgorsen's Cougar offense ran up over 500 yards in total offense on DeRuyter's defense in that game.

I'd say that Holgorsen and DeRuyter have fought to a draw in their matchups so far. So, it definitely will be entertaining to see what each of them pulls out of their respective hats in the next round of what is becoming one of the fascinating personal rivalries that makes big-time college football so compelling.

Posted by Tom at 12:01 AM | Comments (0) |

September 29, 2010

A fascinating season so far

We are only a month into the seemingly endless football season, but this one is already shaping up as one of the most interesting in quite awhile.

Now, note that I didn't say the best season. Simply one of the most interesting.

Inasmuch as I am no longer posting weekly reports on the local teams, the next three posts are going to be about some of the interesting stories that are playing out during this season.

First up, the Texans.

Despite Sunday's home loss to the Cowboys, if the Texans can figure out a way to defeat an improved but beatable Raiders team in Oakland on Sunday, then the local club will be 3-1 and ready to receive one of their best defensive players - LB Brian Cushing - back into the fold after a four-game suspension.

Even more amazingly, the Texans quick start has not appeared to trigger unrealistic expectations in Houston's rabid and success-deprived professional football fans. Most folks seem to understand that the Texans are a curious mix of an explosive offensive team, a decent defensive front, a chaotic defensive secondary and reasonably good special teams.

That mix can definitely win some games in the NFL, but it is also prone to losing its share. Most locals seem to understand this and simply hope that a few random breaks can turn the Texans from the 8-8 team they appear to be into a 10-6 playoff contender.

A few things to watch for with regard to the Texans over the coming weeks:

QB Matt Schaub's health. Although the Texans' offense is impressive, one chink in its armor is the tendency of the offensive line to break down against particularly strong, bull rushing defensive fronts and Schaub's tendency to hold onto the ball too long trying to make the long downfield throw. Those two tendencies result in Schaub taking a large number of sacks and hard hits, which in turn increases injury risk for a QB who has a history of shoulder problems. Inasmuch as Schaub's backups (Dan Orlovsky and Matt Leinart) have, at least to date, done nothing in the NFL to distinguish themselves, an injury that disables Schaub for any appreciable amount of time would likely doom the Texans' nascent playoff chances.

RB Arian Foster's health. Through the first three games of the season, the undrafted Foster is one of the top running backs in the NFL. He clearly is comfortable running in the Texans' scheme and the Texans' OL has done a good job to date giving Foster enough daylight to excel. However, the NFL season is brutal, particularly on RB's who are getting pounded by the opposition 20 times a game. Foster's backup is Steve Slaton - who has inexplicably gone from a spectacular rookie season two seasons ago to resembling a miniature Ron Dayne now - so don't count on the Texans being able to maintain their productive rushing attack if Foster gets dinged up. And if the threat of running the ball effectively recedes, the risk of injury to QB Schaub increases as the defensive fronts load up against the passing attack.

Andre Johnson's ankle. Needs no further explanation.

The secondary's development.  It is rare for a secondary to perform as badly as the Texans' has during the first three games of the NFL season and the team still come out of it with a winning record. Texans management made a conscious decision to go with youth and potential over experience and mediocrity in the secondary this season, so growing pains for this group certainly are not unexpected. But for the Texans to be able to win games when its offense is not clicking on all cylinders, the secondary is now going to have to fulfill that potential. Such development is certainly not impossible as NFL players now frequently show dramatic improvement over the course of a season. Moreover, a more effective pass rush - a definite possibility with the return of Cushing - also could help the secondary improve. However, make no mistake about it, if the secondary continues over the balance of the season chasing rainbows as they have during the first three games, then an 8-8 record for this Texans team would be a moral victory.

Thus, the Raiders (1-2) game this Sunday will provide key insight into this Texans team. The Raiders are likely not a playoff team, but they are strong defensively. They are challenged offensively, but it appears that even an Industrial League team could scorch the Texans' secondary at this point. So, the Texans definitely are at risk of loss.

On the other hand, a win makes the Texans 3-1 at the quarter pole of the regular season with a quality reinforcement returning to help in upcoming games. That would seem to be enough motivation for the Texans to take another step in changing their losing culture, don't you think?

We'll find out Sunday afternoon. Stay tuned.

Posted by Tom at 12:01 PM | Comments (0) |

September 28, 2010

“A powerful and alarming documentary about America’s failing public school system”

That's what this NY Times reviewer calls Waiting for Superman, the much-anticipated documentary on the failure of the U.S. public school system. Here are the John Heilemann/New York Magazine, the Lloyd Grove/Daily Beast and John Nolte/Big Hollywood reviews (h/t Craig Newmark).

Watch and think about this one, folks. It's for our children and grandchildren.

Posted by Tom at 12:01 AM | Comments (1) |

September 27, 2010

With Judge Porteous’ Friends

Who needs enemies? That's what Nola.com's James Gill is asking after sitting through U.S. District Judge G. Thomas Porteous, Jr.'s impeachment trial last week (previous post here). Several of the judge's friends testified for the defense about how they would slip him some money on the side:

Several of those friends were in the habit of slipping Porteous money, and Turley decided to put one of them, Don Gardner, on the stand. That was asking for trouble too, and Gardner promptly provided it by admitting that a federal litigant, alarmed to discover that the other side had retained some friends of Porteous, paid him $100,000 as a counterbalance.

Gardner conceded that he was recruited for the case, although he lacked any relevant expertise, as "a pretty face, someone who knew the judge." He added that he could have pocketed an extra $100,000 by persuading Porteous to recuse himself, but made no attempt to do so, not wanting to be a "whore."

Senators probably did not agree that Gardner's virtue was intact.

Which reminded me of one of the following joke about a crooked judge:

Taking his seat in his chambers, the judge faced the opposing lawyers.

"So," said the judge. "Each of you has presented me with a bribe."

Both lawyers squirmed uncomfortably.

"You, attorney Mohanty, gave me $50,000," observed the judge. "And you, attorney Venkat, gave me $60,000."

The judge reached into his pocket, pulled out $10,000, and handed it to attorney Venkat.

"Now that I've returned $10,000 to attorney Venkat," exclaimed the judge proudly, "I'm going to decide this case solely on its merits!"

Posted by Tom at 12:01 AM | Comments (1) |

September 26, 2010

Journey through Canyons

Posted by Tom at 12:01 AM | Comments (0) |

September 25, 2010

The Embarrassing Ex-President

Who had the worst week in Washington? According to WaPo, former President Jimmy Carter.

No one should be surprised.

Posted by Tom at 12:01 AM | Comments (2) |

September 24, 2010

Take a test or watch the Aggie game? That is the question

The fascinating culture of Texas A&M University football has been a frequent topic on this blog over the years. So, when a current student posted the following dilemma on an Aggie message board, hilarity ensued:

[A professor] scheduled a test on Thursday the 30th from 6-8. When we told him there is a game (Texas A&M vs. Oklahoma State) that night, he just laughed. Here are a list of options I have, please offer any advice.

• Take the test quickly and watch second half
• Record game and start from beginning when I get home, roommates would not be happy
• skip test
• fake illness
• actually get sick and go to quack shack for a university excused absence
• drop the class

Help me out TexAgs.

My favorite response came from an alum who got kicked out of class for bringing Reveille, the collie that is the Aggie mascot, to the class. He advised the professor upon leaving:

"This is your class and I will respect your rules, but please know that you are more expendable to the university than this dog."

Posted by Tom at 12:01 AM | Comments (1) |

September 23, 2010

Stifling Competition

Special business interests commonly use governmental power to stifle competition. Nevertheless, you really couldn't make this example up (H/T Jeff Miron):

The folks who deliver beer and other beverages to liquor stores have joined the fight against legalizing marijuana in California.

On Sept. 7, the California Beer & Beverage Distributors gave $10,000 to a committee opposing Proposition 19, the measure that would change state law to legalize pot and allow it to be taxed and regulated. [.  .  .]

"Unless the beer distributors in California have suddenly developed a philosophical opposition to the use of intoxicating substances, the motivation behind this contribution is clear," Steve Fox, director of government relations for the Marijuana Policy Project, said in statement.

"Plain and simple, the alcohol industry is trying to kill the competition. Their mission is to drive people to drink."

Amazingly, the alcoholic beverage distributors don't realize that one of the unintended consequences of the misguided drug prohibition policy is that illegal drugs are often much less expensive than legal alcoholic beverages.

Posted by Tom at 12:01 PM | Comments (0) |

September 22, 2010

The Nakba Narrative

Don't miss this insightful Sol Stern/City Journal article on a key dynamic that prevents substantive progress in Israeli-Palestinian peace negotiations:

A specter is haunting the prospective Israeli-Palestinian peace negotiations-the specter of the Nakba. The literal meaning of the Arabic word is "disaster"; but in its current, expansive usage, it connotes a historical catastrophe inflicted on an innocent and blameless people (in this case, the Palestinians) by an overpowering outside force (international Zionism).

The Nakba is the heart of the Palestinians' backward-looking national narrative, which depicts the creation of the State of Israel in 1948 as the original sin that dispossessed the land's native people. Every year, on the anniversary of Israel's independence, more and more Palestinians (including Arab citizens of Israel) commemorate the Nakba with pageants that express longing for a lost paradise. Every year, the legend grows of the crimes committed against the Palestinians in 1948, crimes now routinely equated with the Holocaust. Echoing the Nakba narrative is an international coalition of leftists that celebrates the Palestinians as the quintessential Other, the last victims of Western racism and colonialism. [.  .  .]

Unfortunately, no amount of documentation and evidence about what really happened in 1948 will puncture the Nakba narrative. The tale of dispossession has been institutionalized now, an essential part of the Palestinians' armament for what they see as the long struggle ahead. It has become the moral basis for their insistence on the refugees' right to return to Israel, which in turn leads them to reject one reasonable two-state peace plan after another.

In the meantime, the more radical Palestinians continue to insist that the only balm for the Nakba is the complete undoing of the historical crime of Zionism-either eliminating Israel or submerging it into a secular democratic state called Palestine. (The proposal is hard to take seriously from adherents of a religion and a culture that abjure secularism and allow little democracy.)

Posted by Tom at 12:01 AM | Comments (0) |

September 21, 2010

The Magnificent Corporation

Wise words from Professor Bainbridge:

Legal education pervasively sends law students the message that corporate lawyering is a less moral and socially desirable career path than so-called "public interest" lawyering. The corporate world is viewed as essentially corrupting and alienating, while true self-actualization is possible only in a Legal Aid office.

Our students get these messages not only in law school, of course, but also in the media. Films like "A Civil Action" or "Erin Brockovich" illustrate the general ill repute in which corporations-and corporate lawyers-are held, at least here in Hollywood.

In my teaching, I have chosen to unabashedly embrace a competing view. I tell my students about Nicholas Murray Butler, president of Columbia University and winner of the Nobel Peace Prize, who wrote that: "The limited liability corporation is the greatest single discovery of modern times. Even steam and electricity are less important than the limited liability company."

I tell them about journalists John Micklethwait and Adrian Wooldridge, whose magnificent history, The Company, contends that the corporation is "the basis of the prosperity of the West and the best hope for the future of the rest of the world." [.  .  .]

The corporation also has proven to be a powerful engine for focusing the efforts of individuals to maintain economic liberty. Because tyranny is far more likely to come from the public sector than the private, those who for selfish reasons strive to maintain both a democratic capitalist society and, of particular relevance to the present argument, a substantial sphere of economic liberty therein serve the public interest. Put another way, private property and freedom of contract were "indispensable if private business corporations were to come into existence." In turn, by providing centers of power separate from government, corporations give "liberty economic substance over and against the state." [.  .  .]

And so I ask my students: What explains the relatively rapid development in the mid-19th century of a recognizably modern corporation and, in turn, that entity's emergence as the dominant form of economic organization?

The answer has to do with new technologies - especially the railroad - requiring vast amounts of capital, the advantages such large firms derived from economies of scale, the emergence of limited liability that made it practicable to raise large sums from numerous passive investors, and the rise of professional management.

For the most part, these advantages remain true today. The corporation remains the engine of economic growth, both at the level of giants like Microsoft and garage-based start-ups.

The rise of the corporate form thus has "improved the living standards of millions of ordinary people, putting the luxuries of the rich within the reach of the man in the street." The rising prosperity made possible by the tremendous new wealth created by industrial corporations was a major factor in destroying arbitrary class distinctions, enhancing personal and social mobility. Many of the wealthiest businessman of the latter half of the 19th Century and the 20th Century began their careers as laborers rather than as scions of coupon-clipping plutocrats.

And so I put it to my students this way: You want to help make society a better place? You want to eliminate poverty? Become a corporate lawyer. Help businesses grow, so that they can create jobs and provide goods and services that make people's lives better.

So, why are we doing this to those who are attempting to facilitate the benefits of this marvelous creation?

Posted by Tom at 12:01 AM | Comments (3) |

September 20, 2010

The creative nature of football innovation

Inasmuch as Texas has always been a hotbed of innovation in football, this guest Freakonomics post by law professors Kal Raustiala and Chris Sprigman caught my eye:

The theory behind copyright is simple - if we allow anyone to copy a good new idea, then no one will come up with the next one.  The theory makes perfect sense - in theory. [.  .  .]

There has been a lot of innovation in football, in both offensive and defensive systems.  But there has been virtually no attempt to copyright or patent these innovations.  There are some serious doctrinal hurdles, but it's not impossible to imagine the law providing protection. [.  .  .]

So why do football coaches continue to innovate, even when they know that their rivals will study their innovations, take them and use them?  That is, why do football coaches engage in intellectual production without intellectual property?

The authors go on to characterize football as one of the industries in which innovation is best facilitated by intense competition rather than by copyright protection of new ideas. But what is interesting is that, even with the innovations of the pass-happy offenses of the past decade or so, the top teams at the highest levels of college and professional football continue to be the ones that balance an effective passing offense with a solid rushing attack that can wean time off the clock to protect a lead.

Sometimes the more things change in football, the more they remain the same.

Posted by Tom at 12:01 AM | Comments (1) |

September 19, 2010

Perlman & Zukerman

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September 18, 2010

Fare Thee Well, Miss Carousel

Another classic from the late and legendary Texas singer-songwriter, Townes Van Zandt.

Posted by Tom at 12:01 AM | Comments (0) |

September 17, 2010

Your Department of Justice at work

A couple of months ago, this post reviewed the living hell that former Merrill Lynch banker James Brown had been living for the past seven years as he he attempted to salvage his reputation and career after being targeted in the now-thoroughly discredited Nigerian Barge prosecution that arose from the demise of Enron.

As that earlier post noted, after the Fifth Circuit reversed Brown's conviction on honest services wire fraud, the DOJ had inexplicably teed up yet another trial of Brown, which was scheduled to begin next week.

Meanwhile, Brown was seeking a dismissal of the case and of his conviction on additional charges of perjury and obstruction of justice. Those latter charges arose from Brown protesting his innocence to the grand jury that indicted Brown and the other Nigerian Barge defendants on the fallacious honest services wire fraud charges.

Sort of wrong to be convicted of perjury and obstruction for saying that you're innocent of something that is not a crime, don't you think?

At any rate, earlier in the week, the prosecution in Brown's case out of the blue requested a continuance of the September 20 trial setting. The government's dubious grounds for the continuance were that Brown might win an appeal on his perjury and obstruction charges, so the District Court should wait on the outcome of that appeal so that all of the charges could be tried at one time.

After seven years, that's a flimsy reason for a continuance, but at least it's colorable.

However, as Brown's opposition to the government's motion reveals, the reason was also false. The real reason that the government was seeking a continuance was that the prosecution had no intention of prosecuting the case against Brown. In short, the government was only seeking to extend Brown's ordeal:

In sum, the government's motion for an indefinite continuance reveals that the government has put the Court and Brown through months of stress, anxiety and litigation over three counts it has not even intended to bring to trial. Despite being only a few days from the third trial setting, our trial preparation has disclosed that the government has not contacted any of the persons who have knowledge of the transaction and who it presented in its case-in-chief in 2004. Indeed, it has not even contacted its "star witness," Ben Glisan, from Brown I "in years." Nor has it contacted its lone Merrill Lynch witness, Tina Trinkle, about Brown's trial. Trinkle was the only individual whose testimony even alleged that Brown might have participated in one internal Merrill call regarding the government's purported criminal conspiracy.

The government's failure even to notify its key witnesses of the long-scheduled September 20 trial suggests that the government has been using the court to run an outrageous "bluff"-demonstrating the Department's continuing disingenuous gamesmanship with Brown's life and liberty. No continuance shall be granted for "lack of diligent preparation or failure to obtain available witnesses on the part of the attorney for the Government."  .  .  .  This Court must now enforce Brown's right to a trial as scheduled and deny the government's motion.

Not surprisingly, U.S. District Judge denied the government's request for a continuance on Wednesday. The government then filed its motion to dismiss the case entirely shortly thereafter, which Judge Werlein immediately granted.

So, what was the government's purpose in putting James Brown and his family through the wringer over the past seven years?

Ayn Rand's observation about socialists who use state power to further their supposedly altruistic goals seems particularly apt:

"[T]he truth about their souls is worse than the obscene excuse you have allowed them, the excuse that the end justifies the means and that the horrors they practice are means to nobler ends."

"The truth is that those horrors are their ends."

Update: Larry Ribstein, who also has been appalled at the government's conduct of this and related criminal cases for years, provides his customary keen insight to these latest developments.

Dkt 1252 Brown's Opposition to Continuance

Posted by Tom at 12:01 AM | Comments (0) |

September 16, 2010

Liberty or Equality?

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September 15, 2010

The Myth of Superiority

Clear Thinkers favorite Peter Gordon is a very astute fellow:

David Brooks wrote about The Genteel Nation and "gentility shift" last Friday. He was addressing long-term labor market problems that have nothing to do with aggregate demand or any lack of "stimulus," but rather with the tastes of young people making career choices. He cited the example of Michelle Obama, telling an audience of young women, "Don't go into corporate America ... become teachers. Work for the community. Be social workers. Be a nurse ... Make that choice, as we did, to move out of the money-making industry into the helping industry."

It's an old theme and many people think of the choices before them as between being self-serving and "helping people". I am not sure what sacrifices the First Lady has had to make in her personal life in order to get on the high road, but given a platform, we hold forth -- and also tell ourselves all sorts of stories about ourselves. There is always the lovely conceit that some of us are all about "helping people" and, thereby, so much better than the rest.

Labor markets provide their own signals (in terms of compensation packages as well as employment and unemployment prospects), but the problem with rhetoric such as the First Lady's in the Brooks cite is that it nourishes the idea that we see repeated on so often that our own pay is "unfair" in light of the job's assumed social worth.

Many public sector unions have managed to extract promises from their politician employers that these employers cannot keep. There is naturally unhappiness and resentment, but not at the employers. Rather, at the "stingy" taxpayers who just don't get it: those who have chosen to "help people" simply "deserve" more.

Labor markets signal facts of life that challenge the "gentility" view of the world. But the gentility view fortifies the idea that market signals are "unfair" and further politicization is the way. This is the way we get street demonstrations such as the ones we saw in Paris last week. We'll always have the barricades.

This dynamic is the other side of the coin from what leads us to ostracize famous people such as Ken Lay, Tiger Woods and Roger Clemens. We try in any way to avoid confronting our innate vulnerability, so we use myths to distract us. We rationalize that a wealthy and powerful person did bad things that we would never do if placed in the same position even though we really have no idea how we would react to such incentives. As a result, we scorn and ridicule the rich and powerful as we attempt to purge collectively that which is too shameful for us to confront individually.

Be wary of those who justify their world view on the supposed moral superiority of their cause versus how markets would reward that effort. As Gordon notes, this view assumes that market signals are unfair and that political corrections are the answer. The mob is never wrong in the moment of its action.

Posted by Tom at 12:01 AM | Comments (1) |

September 14, 2010

What disaster is worse?

On one hand, the vested interests in America's unending War on Drugs continue to rationalize the enormous cost of drug prohibition by suggesting that the alternative is worse:

Every past administrator of the 37-year-old Drug Enforcement Administration is calling on the Justice Department to sue California if its voters decide to legalize marijuana in November.

Peter Bensinger, who ran the D.E.A. from January 1976 to July 1981, said legalizing the recreational use of pot, even in one state, would be a "disaster," leading to increased addiction, traffic accidents and trouble in the workplace.

Meanwhile, the WSJ's Mary Anastasia O'Grady writes about the wages of the War on Drugs just across the Texas border near El Paso:

Juárez is dying. Since the beginning of this year, more than 2,200 people in the city have been murdered. Since 2008, the toll is almost 6,500. On a per capita basis this would be equivalent to some 26,000 murders in New York City. Drug warriors play down these numbers by claiming that some 85% of the dead were themselves involved in trafficking. But that claim is dubious since in many of the murders-more than 90% of cases this year-there hasn't even been an arrest. And what about the hundreds of innocents, the other 15% of the victims, that the government admits were not criminals? [.  .  .]

In the 40 years since Richard Nixon declared war on drug suppliers abroad-because American consumers had consistently demonstrated that they had no interest in curtailing demand-illicit drug use in rich countries has remained fairly constant. Only preferences have shifted.

A report released in June by the United Nations Office on Drugs and Crime found that "drug use has stabilized in the developed world." Cocaine use in the U.S. has dropped in recent decades, but there is "growing abuse of amphetamine-type stimulants and prescription drugs around the world." The report also said that "cannabis is still the world's drug of choice." In other words, billions of dollars in warring has left us about where we started, except, according to the report, that the indoor cultivation of cannabis is now a major source of funding for criminal gangs.

As I've noted many times, America's War on Drugs is lost and it is long past time that we require our leaders to acknowledge that and end it.

Even if legalization would increase drug abuse and addition (not clear, but certainly possible), at least such a policy would allow the abusers to harm themselves rather than impose substantial risk of harm on innocent citizens.

The War on Drugs is dangerously close to becoming a war on us.

Posted by Tom at 12:01 AM | Comments (1) |

September 13, 2010

Ringing the Bell

I enjoyed the first big weekend of college and NFL football as much as anyone, but the probable concussion that star University of Houston QB Case Keenum suffered in the Cougars' Friday night romp over UTEP reminded me of this Skip Rozin/Wall Street Journal article from awhile back:

Protecting football players from serious head injuries is making news again. Accused for years by outside critics and even Congress of dismissing the danger of concussions, the National Football League has finally installed measures to safeguard players during games and, when they are injured, to treat them more effectively.

The latest effort, a locker-room poster being sent to all NFL teams this month, alerts players to signs of concussion-such as nausea, dizziness and double vision-and urges anyone exhibiting these symptoms to be examined by a doctor. The initiative is supported by both the NFL and the players union.

The message embraces caution in what, for players, is a high-risk environment. Football is a collision sport. At the professional level, collisions occur between the biggest and fastest players and can wreak havoc. A vivid reminder of this came last week when safety Jack Tatum, nicknamed "The Assassin," was back in the news. Tatum, who passed away July 27, made a devastating hit on Darryl Stingley during a 1978 preseason game. The hit turned Stingley into a quadriplegic; no penalty was assessed.

One new rule enacted last season penalizes hits against defenseless players such as quarterbacks and wide receivers. In December, the league banned players who show symptoms of a concussion from returning to play or practice on the same day; they must also be cleared by the team physician and an independent neurologist. The biggest change came this March when the NFL replaced the doctors leading its brain- injury committee-who discredited mounting evidence linking concussions to serious brain damage-with doctors alarmed by the danger.

Welcome changes all, yet the glorification of violence remains a well-entrenched part of football.

In watching a weekend of hard-hitting football, I suspect that there are many more concussions resulting from the games than we even know about from evident injuries such as Keenum's. As I've noted many times in regard to the misdirected governmental criminalization of performance-enhancing drug use, we have promoted a culture that encourages players to take these enormous health risks, but demonize them when they attempt to hedge the risk of the injuries that almost always result from engaging in such high-risk endeavors. What happens to the game of football when players start requiring the owners of that risk to compensate them for their injuries?

My sense is that the games that we watched over this past weekend may be played in a substantially different way in the not- to-distant future.

 

Posted by Tom at 12:01 AM | Comments (3) |

September 12, 2010

Jackie Evancho

What a talent! The other side of the coin from Paul Potts.

Posted by Tom at 12:01 AM | Comments (0) |

September 11, 2010

Lightnin’ Time

Another one of Houston's treasures, the late, great Lightnin' Hopkins.

Posted by Tom at 12:01 AM | Comments (0) |

September 10, 2010

Houston Texans, Year Nine

Year Nine of the Houston Texans begins this Sunday with a home game at Reliant Stadium against the dreaded Peyton Manning and the Colts, so it's time for my seventh (!) annual preview of the hometown team.

The Texans finished off their eighth season in grand style by beating the mostly-trying Patriots with an impressive 21-point 4th quarter comeback. The win wasn't enough to propel the Texans into the playoffs, but it was the Texans' fourth win in their final five games of the 2009 season, which gave the franchise it's first winning record (9-7). In the rather barren terrain of accomplishments that is Texansland, that was a major accomplishment.

Nevertheless, from a won-lost record standpoint, the Texans remain one of the worst expansion franchises in the history of the National Football League after eight seasons. As is usually the case in football, a myriad of influences have combined to cause the Texans' poor overall record, not all of which are the fault of Texans management and players. Nevertheless, with a team as young and relatively unsuccessful as the Texans, it's always helpful to review the team's journey in evaluating whether it is probable that the team has made the progress necessary to make the leap into the NFL playoffs.

The Texans were the toast of Houston for their first three seasons during which Houston's professional football-deprived fans were simply happy to have an NFL team again and didn't really have much in the way of expectations. Texans management and the local mainstream media trumpeted the party line that Texans were building a playoff contender "the right way" -- that is through prudent drafting and development of young players while eschewing the temptation of short-term rewards provided by over-priced veterans who were on the downside of their careers.

The progressively better won-loss records in the first three seasons (4-12, 5-11, and 7-9) -- plus the drafting of young stars such as WR Andre Johnson, RB Dominack Davis (or whatever he ended up changing his name to) and CB Dunta Robinson -- seemed to indicate that the Texans' plan was working. The local mainstream media completely bought into that narrative.

Unfortunately, those progressively better won-loss records distracted Texans management from recognizing that the quality of the Texans' overall roster was not close to that of an NFL playoff contender. The best evidence of that deficiency was that the Texans entered each of their first four seasons with the same two core problems -- the Texans' offensive line could not protect the quarterback and the Texans' defensive front could not pressure the opposition's QB.

Former Texans GM Charlie Casserly never could solve the offensive and defensive line problems (remember LT Tony Boselli, the flirtation with LT Orlando Pace, prospects such as Seth Wand and the thoroughly unimpressive DT's, Anthony Weaver and Travis Johnson?). The 2005 draft was an absolute disaster (DT Johnson as the 15th pick in the first round?) and initial Texans head coach Dom Capers' changes to the offensive and defensive systems between Years Three and Four proved equally dubious. After the Texans limped home with a desultory 2-14 record in Year Four, Texans owner Bob McNair mercifully cut the Casserly and Capers regime loose.

Subsequently, McNair decided to blow up his original management model and surprisingly hired Gary Kubiak, who promptly made (acquiesced to?) a whopper of a blunder in his first major personnel decision as Texans' coach -- retaining QB David Carr even though it was reasonably clear as early as before Year Three that Carr was unlikely to develop into even an average NFL QB.

Kubiak -- who is a quick study in evaluating talent -- promptly soured on Carr during the early stages of Year Five as Texans fans endured one of the worst offenses in the NFL that season. As a result of that horrible Year Five offense, Kubiak arguably overpaid for QB Matt Schaub before Year Six and clearly overpaid for over-the-hill free agent RB, Ahman Green. Not much changed through 12 games of Year Six as even the local mainstream media cheerleaders were questioning whether Kubiak was the proper coach to right the Texans' ship.

Then, seemingly out of nowhere, the Texans showed some spark and won three of their last four games to finish with an 8-8 record for Year Six, the first non-losing record in franchise history. The Texans' offense -- even without Schaub and star WR Andre Johnson for five and seven games respectively -- improved to 12th in the NFL in yards gained and 14th in points scored, by far the best finish of any Texans offense. That was enough to give long-suffering Texans fans hope that things might finally turn around for the franchise the following season.

Unfortunately, the Texans treaded water in Year Seven. A solid season-ending win over the Bears allowed the Texans to finish at 8-8 again, but the team did not contend for a playoff spot and suffered several demoralizing defeats. Given that the team had a 7-9 record after Year Three, a reasonable case could be made that not much progress had been made from the end of Year Three through Year Seven. The offense was better, but the defense was worse than it was after Year Three. Moreover, the 2007 draft was beginning to look almost as bad as the horrid 2005 draft. Had the deck chairs simply been rearranged on the Texans' version of the Titanic?

Thankfully, several signs emerged in Year Seven that indicated the Texans were headed in the right direction. The offensive line and the receiving corps were far-improved and had more depth than at any time in franchise history. Despite being somewhat brittle, Schaub showed the talent necessary to be a consistently above-average NFL QB and RB Steve Slaton emerged as a game-breaking running back. Although the Texans' defense did not improve statistically in Year Seven, the Texans had accumulated a nucleus of young defensive players who -- with proper coaching and sensible personnel adjustments -- were likely to gel into a reasonably effective unit sometime over the next couple of seasons.

Unfortunately, that progress really did not occur in Year Eight. After yet another loss to the Colts in Week 12, the Texans were 5-6 and already a long shot for the playoffs despite a generally favorable schedule. Slaton had inexplicably turned into a fumbling mess of a running back who ended up going on injured reserve after losing his starting job to a group of journeyman RB's. So, despite winning four of their last five games to post their first winning record, the Texans' Year Eight performance had the look of fool's gold.

Although disappointing, that performance was good enough to earn Texans' coach Gary Kubiak another season at the helm. I've been skeptical from the start that Kubiak is the right coach to lead the Texans into the playoffs, primarily because I believe that he was not a good fit for the "strong coach" model that McNair adopted when he fired Casserly and Capers. McNair has endured quite a bit of on-the-job training with Kubiak that he probably would not have experienced with a more seasoned head coach.

On the other hand, each of Kubiak's teams have improved during his tenure with the Texans and his current team appears on paper to be the strongest that the Texans have fielded in their nine seasons. Thus, even though every other NFL team has either made the playoffs or fired its head coach during Kubiak's tenure with the Texans, Kubiak supporters can make a decent case that McNair made the right choice in retaining him, at least for Year Nine.

Despite my skepticism about Kubiak's ability to lead the Texans over the playoff hump, he does have many positive characteristics. The players like him and play hard for him. He handles the players and media well, and I have always been impressed by his willingness to recognize mistakes, cut losses and make changes. Kubiak does not seem to be burdened with the stubbornness that often undermines NFL head coaches.

Moreover, continuity in coaching staffs is an underappreciated factor in the success of NFL teams, so maybe giving Kubiak more rope than most NFL coaches receive will finally produce McNair a winner. McNair certainly deserves it in view of his patient support of the Texans' football operation.

But what does all of this mean for the Texans in Year Nine?

Given the high number of variables that play into a successful NFL season, picking NFL playoff teams is a highly speculative endeavor, at best. Given that constant change is a fact of NFL life, assessing something as seemingly simple as strength of schedule is a moving target and can literally change overnight, particularly given the high injury risk in the NFL.

My sense is that the Texans have accumulated enough talented football players on offense to be playoff-caliber so long as QB Schaub remains healthy and new PK Neil Rackers doesn't have a meltdown like Kris Brown had last season. But defensive improvement will probably again be the key to whether this season is a breakthrough season for the Texans or another disappointment.

Inasmuch as one of the Texan's best defensive players (LB Brian Cushing) is suspended for the first four games and Kubiak elected to go with a young and relatively inexperienced secondary, my sense is that defensive improvement will be slow and probably not evident until later in the season. Accordingly, I'm placing the over/under for Texans' wins this season at eight, the same number as I predicted last season. Eight wins will not be good enough to make the playoffs.

Oh well, patience is certainly a virtue for anyone who is a Texans fan.

Finally, as with my regular baseball reports on the Stros, I'm dispensing this season with the weekly football game reviews that I've done over the past seven years. The blogosphere has grown to the point where virtually every pro and college team has a blog that covers each team far better than I ever could in my once-a-week posts. As with the Stros, I'll continue to do an occasional post on discrete games or issues during the season, but simply not on a weekly basis anymore.

Moreover, with the maturation of the sports blogosphere, there really is no reason to rely any longer on the mainstream media for football news and analysis. For several years now, Alan Burge has been doing a much better job of covering the Texans on a nuts and bolts basis than the mainstream media, while bloggers Stephanie Stradley, Lance Zerlein and Houston Diehards all provide first-rate analysis of particular issues facing the Texans.

Similarly, on the college football front, both The Wizard of Odds and the Pre-Snap Report are excellent resources for keeping up with the college football season overall. With regard to blogs that cover particular teams, Barking Carnival is my favorite for the Texas Longhorns, while I Am the 12th Man does a good job of covering the Texas Aggies.

On the local front, the best sources of information on the Houston Cougars are Steve Campbell's blog and Fight for Red and White blog, while The Rice Football Webletter does a great job of covering the Owls.

So, with that, let the games begin!

Posted by Tom at 12:01 AM | Comments (0) |

September 9, 2010

You’ve got to be kidding me

No, really. Get a load of this:

The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

As the economy again sputters and potential buyers flee - July housing sales sank 26 percent from July 2009 - there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.

When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.

As regular readers of this blog know, the notion that housing markets need to allocate risk of loss before those markets can stabilize and recover is not rocket science.

In fact, the government's dithering over the past two years in propping up these inflated housing markets has actually made the situation worse because it has postponed the transfer of misallocated resources in the housing markets to other markets.

Another day, another failed bailout. So it goes.

Posted by Tom at 12:01 AM | Comments (0) |

September 8, 2010

Retiring thoughts

Clear Thinkers favorite Arnold Kling has had some insightful thoughts lately (see also here) about the economics of retirement lately:

[Megan McArdle's] main point is that if you live about 90 years and spend the last 30 of them not working, it is hard to maintain your standard of living no matter who pays for it. There is a lot of optimism about stock market returns built into state pension funds, individual retirement plans, and--I would say--even Social Security and Medicare. My argument is that without strong stock market returns, general tax revenues are not going to be robust, and Social Security and Medicare will go broke really soon without robust general tax revenues. [. . .]

For any given level of output, more consumption by one group (say, people over 65) is going to reduce what can be consumed by everyone else. As the ratio of people over 65 to everyone else goes up, this increases the ratio of state-confiscated income to total income required to keep Social Security and Medicare going. [To some] this higher confiscation rate represents a kinder and gentler society. But it may not feel kind and gentle to those who earn incomes and have them confiscated.

Kling's thoughts resonate when reading this WSJ article on teacher's pensions:

When it comes to shaking up the status quo, however, the most potent education reform may be the one that's too often considered a side issue: pension reform.

That's right, pension reform. Over the past 25 years, the private sector has moved from having four of five workers in a defined-benefit pension to having just one of five workers in such a plan. Mostly this means a shift to 401(k)s and the like, where payouts are related to what employees pay in.

Like most government employees, teachers have not made this shift. Their unions fight bitterly to retain the defined benefit plans underwritten by taxpayers. While these plans allow some lucky folks to retire in their 50s with a generous payout, they also feature perverse incentives that punish the young (more on this below) and encourage people to hang on for dear life even when they'd much rather leave. [.  .  .]

"A retired teacher paid $62,000 towards her pension and nothing, yes nothing, for full family medical, dental and vision coverage over her entire career," said [Governor Chris Christie]. "What will we pay her? $1.4 million in pension benefits and another $215,000 in health-care benefit premiums over her lifetime. Is it 'fair' for all of us and our children to have to pay for this excess?"

The article goes on to point out that the unintended consequence of these subsidized pensions is that - similar to the dynamic of employer-based health care policies - employees lose the incentive to pursue different and potentially more fulfilling careers because of fear that they will lose their non-portable benefits if they change jobs.

Does it really make sense to reward employees who simply wait out the system for the pot at the end of the rainbow that the rest of us cannot afford to provide?

Posted by Tom at 12:01 AM | Comments (2) |

September 7, 2010

Preparing for Life

I've never been a fan of John Grisham's novels, although I concede that a couple of them have been made into entertaining movies.

But after reading this Grisham/NY Times op-ed, I'm a big fan of John Grisham:

I WASN'T always a lawyer or a novelist, and I've had my share of hard, dead-end jobs. I earned my first steady paycheck watering rose bushes at a nursery for a dollar an hour. I was in my early teens, but the man who owned the nursery saw potential, and he promoted me to his fence crew. For $1.50 an hour, I labored like a grown man as we laid mile after mile of chain-link fence. There was no future in this, and I shall never mention it again in writing.

Then, during the summer of my 16th year, I found a job with a plumbing contractor. I crawled under houses, into the cramped darkness, with a shovel, to somehow find the buried pipes, to dig until I found the problem, then crawl back out and report what I had found. I vowed to get a desk job. I've never drawn inspiration from that miserable work, and I shall never mention it again in writing, either.

But a desk wasn't in my immediate future. My father worked with heavy construction equipment, and through a friend of a friend of his, I got a job the next summer on a highway asphalt crew. This was July, when Mississippi is like a sauna. Add another 100 degrees for the fresh asphalt. I got a break when the operator of a Caterpillar bulldozer was fired; shown the finer points of handling this rather large machine, I contemplated a future in the cab, tons of growling machinery at my command, with the power to plow over anything. Then the operator was back, sober, repentant. I returned to the asphalt crew.

I was 17 years old that summer, and I learned a lot, most of which cannot be repeated in polite company. One Friday night I accompanied my new friends on the asphalt crew to a honky-tonk to celebrate the end of a hard week. When a fight broke out and I heard gunfire, I ran to the restroom, locked the door and crawled out a window. I stayed in the woods for an hour while the police hauled away rednecks. As I hitchhiked home, I realized I was not cut out for construction and got serious about college.

Many of us had similar experiences to Grisham's before finding our life's work. In talking with young folks these days about their uncertain futures, I find myself often advising them that uncertainty is, for most of us, an unavoidable part of life. Although often difficult at the time, those experiences help define our character and spirit.

I decided to go to law school while working on a loading dock on Produce Row in Houston. I'm eternally grateful for that loading dock. What was your loading dock?

Posted by Tom at 12:01 AM | Comments (1) |

September 6, 2010

Voice Recognition Elevator

Posted by Tom at 12:01 AM | Comments (0) |

September 5, 2010

John Cleese on Creativity

Find a way to avoid the distractions, at least for a little while (H/T Presentation Zen).

Posted by Tom at 12:01 AM | Comments (0) |

September 4, 2010

A Film Unfinished

The film's website is here.

Posted by Tom at 12:01 AM | Comments (0) |

September 3, 2010

Answering the Obesity Paradox

On one hand, drinking even diet soft drinks causes higher risk of heart disease?:

A new US study has found that drinking more than one soft drink a day, whether regular or diet, may be linked to an increased risk of developing heart disease, via an increase in metabolic syndrome, a group of characteristics like excess girth, high blood pressure, and other factors that increase the chances of getting diabetes and cardiovascular problems.

But on the other hand, even though overweight people are at higher risk of heart attacks, patients with heart failure have lower mortality rates if they are obese:

[T]he "obesity paradox" among patients with heart failure. The paradox refers to the repeated finding that while overweight people are more prone to heart failure, patients with heart failure have lower mortality rates if they are obese. The reason for this paradox is far from clear, though Dr. Lavie suggested that one explanation could be that once people become ill, having more bodily "reserve" could be to their advantage.

My sense is that the obesity paradox is more the result of overweight people having more muscle mass. It's not the excess fat that helps them recover from heart failure. It's the muscle mass and strength.

As Art DeVany has been saying for years: "Muscle is medicine. Strength carries us effortlessly through life." As we age, our workout routines should be tailored toward maintaining or increasing strength.

Posted by Tom at 12:01 AM | Comments (0) |

September 2, 2010

Swing Thoughts

A couple of interesting articles on very good golfers at different stages of their careers came across my desk yesterday.

Jaime Diaz - consistently one of Golf Digest's best writers - wrote this Golf Digest article on his conversation with Jack Nicklaus in connection with the Golden Bear's 70 birthday (H/T Geoff Shackelford). Although Nicklaus still holds the record for major championship victories at 18, he tells Diaz that he now thinks he could have accomplished substantially more if he had really applied himself (he believes he left about one third of his effort on the table). Nicklaus goes on to note that his failure to learn proper pitching technique until relatively late in his career cost him several major victories.

The other insightful article is this Sean Martin/GolfWeek piece on the hottest golfer on the PGA Tour this year - the relatively unheralded Matt Kuchar, who lost his Tour card earlier in the decade and appeared to fall off the golf map after a stellar amateur and collegiate career.

Martin does a good job of explaining the swing change that saved Kuchar's career. And as with many things in golf, there is a Houston connection to Kuchar's conversion.

When his golf game was bottoming out five years ago, Kuchar came to Houston to see Jim Hardy, who sort of specializes in golf swing reclamation projects.

Kuchar initially worked with Hardy, who then introduced him to his acolyte, Chris O'Connell. From there, as Martin explains in the article, O'Connell helped Kuchar change his swing to one that rotates much more around his body rather than up and down along the target line. As Jeff Ritter pointed out here awhile back, the swing changes that Tiger Woods is now making with his new swing coach (Sean Foley) are quite similar to the ones that Kuchar made.

It took a couple of years, but Kuchar has now fully embraced the swing change and the results have been amazing. With his win last weekend at the Barclay's, Kuchar is now first in money earned this season on the Tour, has now finished in the top 20 in 11 of his last 13 tournaments and has the most top 10 finishes this season on the Tour. Not surprisingly, Kuchar will be one of the members of the U.S. Ryder Cup team next month.

Good thing he came to Houston, don't you think?

Posted by Tom at 12:01 AM | Comments (0) |

September 1, 2010

Are you ready for some football?

The draft of Year XXIII of the Fantasy Football League of Houston (yes, that's year 23 - our league was one of the first) was held last night and a good time was had by all. And thankfully, Norman Tugwater did not show up.

Posted by Tom at 12:01 AM | Comments (0) |

August 31, 2010

Health care finance myths die hard

In the face of undeniable proof that the concierge medical practice model, particularly when combined with the use of Health Saving Accounts, is an innovative market force that is addressing finance problems for a substantial portion of the health care market, this New York Times grudgingly acknowledges that concierge medicine may be a viable way to control health care costs at least for a substantial portion of health care consumers.

But on the other hand, the Times doesn't want you to forget that HSA's don't work for everybody:

Critics have been less enthusiastic about H.S.A.'s, worrying that high-deductible plans work only for young, relatively healthy people who do not spend a lot on health care anyway. When sick people are faced with paying high out-of-pocket costs for medical bills, they simply go without the care they need, experts note.

As Arnold Kling has observed, why does the Times think that that we cannot possibly afford health care if we have to pay for it individually, but we can afford it if we pay for it collectively?

 

Posted by Tom at 12:01 AM | Comments (3) |

August 30, 2010

McMurtry's Hollywood

One of the wonderful things about owning a Kindle is that it is easy to download and read a book that you might have put off for awhile until the stack of books on the nightstand receded a bit.

One such book is Larry McMurtry's latest, Hollywood: A Third Memoir (Simon & Schuster 2010). McMurtry has been writing screenplays for Hollywood now for the better part of 50 years, so he has a wealth of anecdotes to pass along about the movie industry.

And somewhat surprisingly, McMurtry passes along keen insight into the business of how movies are conceived, made and sometimes not made.

For example, after the success of the 1971 film Last Picture Show, which was based on McMurtry's novel of the same name, McMurtry observed the following about the Academy Award-winning stars of that movie, Cloris Leachman and Ben Johnson:

Ironically, but not surprisingly, when Ben Johnson and Cloris Leachman won Oscars for their performances, they decided that, by God, they were stars, and acted like stars from then on.

The first thing they did, as stars in their own heads, was price themselves out of the market, which, Oscars or not, assessed them rather more modestly than they assessed themselves.

Refreshingly, despite his obvious affection for Tinseltown, McMurtry candidly admits that he was drawn to it by the money. As he observes:

Money trumped talent, and, in the movie business, that is usually the case.

He even learned how to be a cost-effective screenwriter:

[T]he fact that I came from a generation of cattlemen gave me a slight edge - I learned not to have scenes in my Westerns that would be prohibitively expensive.

One way to achieve that was to reduce the number of animals to the lowest possible figure. Animals are well protected on movie sets, and are very expensive to use. I think they used three sets of the famous pigs in Lonesome Dove, pigs who in the narrative walk all the way from Texas to Montana only to get eaten.

Finally, on the age-old issue of whether a movie is art or a profit center:

[B]ut any thinking based on the conviction that one movie is art and another not is purely speculative. Only time will answer that question.

If you enjoy good writing, insightful observations and Hollywood, then pick up Hollywood: A Third Memoir. You will not be disappointed.

Posted by Tom at 12:01 AM | Comments (0) |

August 29, 2010

The Commerce Clause -- A conduit for state power

Posted by Tom at 12:01 AM | Comments (7) |

August 28, 2010

Why do the feds even care?

Following on this post from last week on the misdirected nature of the criminal prosecution of Roger Clemens, Allen Barra wrote this W$J op-ed mirroring my skepticism over the case:

Never mind that there was no criminal penalty attached to anything Mr. Clemens is accused of using-if there were, Jose Canseco, who has written two books bragging about his use of steroids, would be serving time. Never mind, too, that when Mr. Clemens is said by his accusers to have used such substances, they weren't even banned from Major League Baseball: the Basic Agreement between the Players Association and owners forbidding the use of PEDs didn't take effect until 2004.

And let's disregard as irrelevant the judgment of baseball analysts such as David Ezra (author of "Asterisk: Home Runs, Steroids, and the Rush to Judgment") and J.C. Bradbury (author of "The Baseball Economist: The Real Game Exposed"), who have studied PEDs and Mr. Clemens's performance and found no statistical evidence that, even if he took PEDs, he gained any advantage from them. [.  .  .]

All that matters to the government is that, in February 2008, Mr. Clemens may have lied to a House committee on a matter the committee had no business poking its nose into in the first place. If there was no criminal penalty for using the drugs and if MLB and the union have agreed now to police their own house, why do the feds even care?

That's a good question, and one we all deserve an answer to before the government goes to the expense of putting Mr. Clemens on trial.

As I noted earlier, Clemens has not defended himself well. But the government's handling of the investigation into his conduct is far more egregious. Here's hoping that Clemens' jury sees it the same way.

Posted by Tom at 12:01 AM | Comments (6) |

August 27, 2010

The pro sports bubble

So, to the surprise of absolutely no one who follows such things, Moody's Investors Service lowered the ratings of the already junk bond debt of about a billion dollars that the Harris County-Houston Sports Authority issued to finance construction of Reliant Stadium, MinuteMaid Park and Toyota Center:

Moody's believes the liquidity reserves are sufficient to cover the November 2010 payment, but their depletion may result in a payment default from pledged revenues as early as March of 2011, the report said.

If hotel occupancy tax and motor vehicle rental tax revenue continues to decline through 2010, the ratings could face further pressure, Moody's said. Revenue from those taxes to the Sports Authority dipped by 11.7 percent in 2009 and are continuing that trend in 2010.

Of course, the romantics among us think it would be peachy to borrow even more money and resurrect the Astrodome into another kind of white elephant. This despite the fact that the markets has been telling us for over a decade now that there is no profitable purpose for it.

Meanwhile, most professional sports franchises are not doing all that well these days even with local governments providing these huge public subsidies

So, highly-leveraged debt, a high-priced product, increasingly unprofitable operations, and intense competition from a myriad of different (and substantially cheaper) forms of entertainment.

Does anyone else think that this pro sports bubble is about to burst?

Posted by Tom at 12:00 AM | Comments (0) |

August 26, 2010

Inside Job

Posted by Tom at 12:00 AM | Comments (0) |

August 25, 2010

Training camp -- A football tradition that needs to die

Last week, this post noted the growing financial implications of injury risk in the National Football League and the utter lunacy of exposing high-priced player assets to such injury risk during the NFL's grueling pre-season practices and games.

This week, William Rhoden of the NY Times notices the same thing:

The N.F.L. perpetrates two annual frauds: one against the American public, the other against players who give body and blood to make the league a multibillion-dollar enterprise.

The first fraud is preseason football, those empty, glamorized scrimmages that teams force on season-ticket holders as parts of the regular-season package.

The second, more dangerous fraud is training camp, which exposes veteran players to unnecessary risk and perpetuates the myth that football is more complicated than it really is.

Despite the fact that every NFL player engages in year-around training, the tradition of a long and largely useless training camp still survives at the highest level of American football. Thankfully, at least some in NFL management are starting to notice:

"I don't know if the body has enough time to recuperate because you're seeing so many soft-tissue injuries," Jerry Reese, the Giants' general manager, said. "There's more opportunity for injury because there's so much more time on the field. Then you have training camp and you go double during training camp. And you see all across the league there are a bunch of injuries." [.  .  .]

"It's a balancing act; I'm not sure how well we're balancing it right now." [.  .  .]

Giants linebacker Keith Bulluck said it did not make sense for players to beat one another up in camp "and then when we have to go play a team, we don't have the player that we need."

Bulluck recalled that in his rookie season, in 2000, most teams held two-a-day practices with lots of contact. "It was physical, very physical, when I came in," he said.

Over the years, many teams have evolved toward more classroom work. [.  .  .]

Referring to Giants camp, he added: "Not too many two-a-days here, either. I guess the coaches are beginning to understand that it's more about the season. Beating the guys up in August doesn't help in September, October, November and December."

This much is certain: training camp is an idea that has outlived its usefulness.

There are few athletic endeavors more boring than football practice. Hammering players for a month and a half before a brutal 4+ month season makes no sense at all.

Teams should complete their hardest workouts a couple of months before the beginning of the season and then tailor pre-season work-outs toward maximizing strength, speed and health while emphasizing scheme understanding.

As Rhoden's article notes, teams are slowly moving that way. But, then again, despite serious training camp attrition already, did you know that Texans Coach Gary Kubiak announced earlier this week that he intended to expose his starters to high injury risk for three quarters in this week's practice game against the Cowboys?

So it goes.

Posted by Tom at 12:00 AM | Comments (0) |

August 24, 2010

Rather than a car, how about a health club membership?

Now even driving causes obesity?

So, does that mean we should subsidize light rail boondoggles to help curtail obesity?

Thankfully, Peter Gordon asks that always knotty question: "At what cost?" After analyzing the data, he concludes:

"Cynics started doing the math many years ago and found that buying rail transit users a car would be far cheaper [than public subsidies of inefficient light rail systems]. But that would never fly with the smart set."

"So consider the 2010 update which suggests that buying them a bus pass plus health club membership is the way to go. The various "cash-strapped" governments would save money."

Posted by Tom at 12:00 AM | Comments (0) |

August 23, 2010

Again, why is Timothy Geithner still Treasury Secretary?

Regular readers know that I'm not a big fan of Treasury Secretary Geithner.

But after poorly-conceived governmental programs subsidizing mortgage loans played a not insubstantial part in the worst financial crisis in a generation, this NY Times article left me speechless for a few days:

Treasury Secretary Timothy F. Geithner, speaking Tuesday at a conference to discuss the possibilities [of reforming the government's role in housing finance], made clear that the administration was not pondering such radical kinds of surgery as it develops a proposal it hopes to unveil in January.

Rather, Mr. Geithner and the conference after his remarks focused largely on drafting a new and improved version of the current system, in which the government subsidizes mortgage loans made by private companies.

Mr. Geithner said continued government support was important to make sure that Americans can borrow at reasonable interest rates to buy a house even in a downturn. The absence of such support, Mr. Geithner said, would deepen future recessions because unsubsidized private companies would curtail lending.

I mean really. After what we've been through, why on earth should the government be involved in mortgage markets in any respect?

Government intervention in mortgage markets is simply a thinly-disguised redistribution of income. But even if you think government should be doing such things, creating moral hazard in mortgage markets is a very costly way to accomplish that goal.

Stated simply, the social benefits of home ownership result from homeowners building equity in their homes through saving and enhancing neighborhoods. Those social benefits are not generated from homeowners who borrow excessively to speculate on housing in which they have no equity.

As with proponents of publicly-financed sports stadiums, proponents of such redistribution policies should simply make their case that redistribution is sound public policy and not disguise it in expensive mortgage subsidies. They don't because of fear that voters would reject such a redistribution policy if they came to understand the true cost of these subsidies. Truth in advertising in politics is rare, indeed.

Posted by Tom at 12:00 AM | Comments (3) |

August 22, 2010

Hospitalist v. Cardiologist

The primary care doctors are having a nice chuckle over this one.

Posted by Tom at 12:00 AM | Comments (0) |

August 21, 2010

Riding a solid rocket booster

The camera that shot this video is mounted on one of the solid rocket boosters for the Space Shuttle. The launch clock is in the upper left corner. The first couple of minutes is uneventful, but the rest of the seven minute video certainly is not. Enjoy!

Posted by Tom at 12:00 AM | Comments (0) |

August 20, 2010

A misfired missile shot at the Rocket

So, the seemingly inevitable indictment of Roger Clemens finally was handed down yesterday.

Perjury is serious business and it remains to be seen how well Clemens will deal with the charges. Clemen's legal strategy so far has certainly been at least questionable, if not downright bizarre. Joe Posnanski chronicles Clemens' self-denial.

But for all of Clemens' unattractiveness, it's difficult not to get the sense already that this is yet another colossal misuse use of prosecutorial resources (Bill Anderson agrees). In the glare of the spotlight of this high-profile prosecution, the more troubling issues involving the use of performance-enhancing drugs such as steroids tend to get overlooked.

The mainstream media and much of the public will castigate Clemens -- who is an easy target -- just as they filleted Barry Bonds and Alex Rodriguez.

The dynamic is the same one that we saw in regard to the downfalls of both Tiger Woods and Ken Lay. We try in any way to avoid confronting our innate vulnerability, so we use myths to distract us. We rationalize that a wealthy athlete such as Clemens did bad things that we would never do if placed in the same position (yeah, right). As a result, Clemens supposedly deserves our scorn and ridicule. That a scapegoat such as Clemens comes across as arrogant and irresponsible makes the lynch mob even more bloodthirsty as it attempts to purge collectively that which is too shameful for us to confront individually.

Of course, much of that same mainstream media and public contribute to the pathologically competitive Major League Baseball culture. The MSM regularly caters to the public's desire to idolize players who risk career-threatening disability by taking painkilling drugs so that they can play through injuries.

But players who used PED's in in an effort to strengthen their bodies to avoid or minimize the inevitable injuries of the physically-brutal MLB season are widely viewed as pariahs.

How does that make any sense?

Meanwhile, the fact that MLB players have been using PED's for at least the past two generations to enhance their performance is largely ignored the mind-numbingly superficial analysis of the PED issue that is being trotted out by most media outlets. Sure, Barry Bonds hit quite a few home runs during a time in which he was apparently using PED's. But should Pete Rose be denied the MLB record for breaking Ty Cobb's total base hits record because he used performance-enhancing amphetamines throughout his MLB career?

These witch hunts, investigations, criminal indictments, morality plays and public shaming episodes are not advancing a dispassionate and reasoned debate regarding the complex issues that are at the heart of the use of PED's in baseball and other sports. On a very basic level, it is not even clear that the controlled use of PED's to enhance athletic performance is as dangerous to health as many of the sports in which the users compete.

Wouldn't a public discussion on how to construct a reasonable regulatory system for the safe and healthy use of PED's be a more productive use of resources than criminalizing Roger Clemens?

Here are links to a number of related HCT posts over the years on the issues relating to performance-enhancing drugs in professional sports:

A former drug-tester advocates a different approach to regulating PED's.

When you break the law in pursuing the devil, what happens when the devil turns on you?

Art DeVany challenges the conventional wisdom regarding the impact of PED's in Major League Baseball. Russ Roberts interviews DeVany here.

Is Barry Bonds this era's Jack Johnson?

MLB's Mitchell Report on PED's was a real hatchet job (see also here and here).

Let's have a more productive discussion about PED's in sport.

Posted by Tom at 12:01 AM | Comments (0) |

August 19, 2010

Sidewalk Socrates

In several respects, my mentor and dear friend Ross Lence was similar to legendary Columbia philosophy professor Sidney Morgenbesser -- a consummate teacher and witty thinker who didn't care much for academia's preoccupation with publishing.

So, I enjoyed reading this James Ryerson/NY Times Magazine profile (H/T Al Roberts) of Morgenbesser that reminded me of a funny philosophy story involving Morgenbesser that Professor Lence had passed along to me with relish many years ago:

In the academic world, custom dictates that you may be considered a legend if there is more than one well-known anecdote about you.

Morgenbesser, with his Borscht Belt humor and preternaturally agile mind, was the subject of dozens. In the absence of a written record of his wisdom, this was how people related to him: by knowing the stories and wanting to know more.

The most widely circulated tale -- in many renditions it is even presented as a joke, not the true story that it is -- was his encounter with the Oxford philosopher J. L. Austin.

During a talk on the philosophy of language at Columbia in the 50's, Austin noted that while a double negative amounts to a positive, never does a double positive amount to a negative.

From the audience, a familiar nasal voice muttered a dismissive, "Yeah, yeah."

Posted by Tom at 12:00 AM | Comments (0) |

August 18, 2010

The financial implications of NFL injury risk

As we endure the annual, mind-numbing boredom of NFL pre-season football, my thoughts about football are elsewhere.

That is, why on earth do NFL teams expose their valuable players to such extreme risk of injury when the games do not even count?

The local Texans lost their first second round draft choice to injury for the season this past weekend. And for what?

The elephant in the closet in regard to football overall and the NFL in particular is the increasing recognition of the high injury risk that players are taking. Although this NY Times article involves primarily former MLB star Lou Gehrig and speculation whether he really died of amyotrophic lateral sclerosis, the article provides an overview of new clinical evidence that the brain damage being suffered by NFL players is severe:

Doctors at the Veterans Affairs Medical Center in Bedford, Mass., and the Boston University School of Medicine, the primary researchers of brain damage among deceased National Football League players, said that markings in the spinal cords of two players and one boxer who also received a diagnosis of A.L.S. indicated that those men did not have A.L.S. at all. They had a different fatal disease, doctors said, caused by concussion like trauma, that erodes the central nervous system in similar ways.

The finding could prompt a redirection in the study of motor degeneration in athletes and military veterans being given diagnoses of A.L.S. at rates considerably higher than normal, said several experts in A.L.S. who had seen early versions of the paper. Patients with significant histories of brain trauma could be considered for different types of treatment in the future, perhaps leading toward new pathways for a cure. [ . . .]

A link between professional football and A.L.S. follows recent discoveries of on-field brain trauma leading to dementia and other cognitive decline in some N.F.L. veterans. Dr. McKee and her group identified 14 former N.F.L. players since 1960 as having been given diagnoses of A.L.S., a total about eight times higher than what would be expected among men in the United States of similar ages.

However, the doctors cautioned, the existence of the increased number of A.L.S.-like cases should not create the same level of public alarm as the cognitive effects of brain trauma, which affect hundreds of former professionals and perhaps thousands of boys and girls across many youth sports.

Although even players commonly continue to underestimate injury risk in the NFL, my sense is that such miscalculations are being understood better and will likely recede. With NFL teams facing increasing litigation risk from injured players, will NFL teams be able to use the shield of the collective bargaining process much longer to protect the league members from the possibly severe financial implications of that risk?

And if the NFL is facing potentially dire financial implications from the increasing recognition of high injury risk, what about the implications for college football, where the compensation paid to players is regulated more rigidly than in the NFL?

Finally, will the financial implications of injury risk in football eventually prompt dramatic changes in the way the game is played?

Seems to me that these questions are a lot more interesting than pre-season football.

Posted by Tom at 5:25 AM | Comments (1) |

August 17, 2010

Will Skilling be released?

On the heels of his brief on the merits in support of his motion to be released from prison pending further disposition of his case by the Fifth Circuit Court of Appeals and the U.S. District Court, Jeff Skilling filed his reply brief below (download it to review the bookmarked version) to the government's merits brief opposing his proposed release.

Skilling's brief hammers home why he should be released:

As the standard is articulated in [Neder v. U.S., 527 U.S. 1 (1999)], the case on which the government relies, a court cannot find the presence of a factually supported invalid theory to be harmless beyond a reasonable doubt where the defendant contested the [valid theory] and raised sufficient evidence to support a contrary finding. 527 U.S. at 19. In that situation, it cannot be presumed that rational jurors necessarily would have accepted the valid theory, and so it remains impossible to tell which theory the jury selected.

As shown below, the government cannot prove that the honest services error was harmless because, for every count of conviction, the record, the instructions, evidence, and argument allowed a rational juror to reject the valid theory asserted, while relying on the invalid honest-services theory to return a conviction. Because it is thus impossible to tell whether the jurors selected the valid or invalid path to conviction for any count, every count must be reversed.

Stated simply, the government relied on the amorphous nature of an invalid theory of criminality in obtaining a conviction against Skilling on numerous different charges. Having relied on that blather, the government cannot now prove that the jury didn't rely on it in convicting Skilling on all charges.

Although results rarely occur as they should in misdirected criminal prosecutions, Skilling really should win his release and a re-trial. Stay tuned.
Jeff Skilling's Reply Brief on his Motion for Bail

Posted by Tom at 5:44 AM | Comments (1) |

August 16, 2010

Following up on Hurd and H-P

Interesting. The NY Times' Joe Nocera chimes in on the demise of Mark Hurd at Hewlett-Packard.

But the blogosphere had already revealed a week ago the essence of the information in Nocera's article. Another reflection of how the mainstream media is now often decidedly behind the blogosphere in providing key information about breaking events.

And not to pile on, but how does one of the best business reporters of the NY Times write an article about this situation and not ask the most important unanswered question? That is, why did the H-P Board accept Hurd's resignation and provide him a $40 million severance package if the Board had grounds to terminate him for cause?

And if the Board didn't have cause to fire Hurd, then why did Hurd's contract not make violation of H-P's written code of business conduct cause for termination of employment? Is that the same for other H-P contracts with its executives? At least this subsequent WSJ article gets closer to answering those questions.

My bet is that the blogosphere will ultimately provide the answer to that question more quickly than the NY Times.

 

Posted by Tom at 12:01 AM | Comments (1) |

August 15, 2010

Hallelujah

One of the best covers of one of the most covered songs -- the late Jeff Buckley's rendition of Leonard Cohen's Hallelujah.

Posted by Tom at 12:01 AM | Comments (1) |

August 14, 2010

The irrelevance of drug prohibition

Check out this interesting letter to the editor of the Wall Street Journal yesterday from Robert Sharpe of Common Sense for Drug Policy:

What's interesting about the drop in violence associated with crack cocaine is the irrelevance of drug enforcement. During the peak of the 1980s crack epidemic, New York City applied the zero-tolerance approach. Meanwhile, Washington, D.C. Mayor Marion Barry was actively smoking crack and the nation's capital had the highest per capita murder rate in the country.

Despite very different leadership and law enforcement, crack use declined in both cities simultaneously. This parallel decline occurred when the younger generation saw firsthand what crack was doing to their older peers and decided for themselves that crack was bad news. Adding to what is already the highest incarceration rate in the world is not the answer to America's drug problem. Diverting resources away from prisons into cost-effective, substance-abuse treatment would save both tax dollars and lives.

Posted by Tom at 12:01 AM | Comments (0) |

August 13, 2010

A Texas Legend Fades

Former Texas A&M and long-time Texas high school football coach Emory Bellard -- who invented the famous Wishbone triple-option offense that transformed college football in the late 1960's and 70's -- is suffering from amyotrophic lateral sclerosis, more commonly known as Lou Gehrig's disease. The Chron's Richard Justice passes along the news along with many nice remembrances of several of his former players.

Coach Bellard is truly a Texas football legend. He was an extraordinarily successful Texas high school coach from 1952 to 1966 at Ingleside, Breckenridge and San Angelo Central -- his teams won the 1958 and '59 state titles at Breckenridge and the 1966 crown at San Angelo Central.

But it's Coach Bellard's college coaching career that most folks remember. Darrell Royal hired Bellard as an assistant coach at the University of Texas in 1967 where Bellard developed the Wishbone offense that was instrumental in the success of UT's 1969 and 1970 national championship teams that won 30 straight games.

Largely on the basis of his success at UT, Coach Bellard was named head coach at Texas A&M in 1972 and appeared to have the Aggie program at the brink of national prominence in 1978. Then, seemingly out of nowhere, a tumultuous two-week period midway through that season resulted in Bellard resigning the head coaching position that he coveted.

Coach Bellard went on to coach at Mississippi State from 1979-85, but this quintessential Texas football coach always looked somewhat out of place in SEC country.

So, after retiring from coaching upon getting the axe at Mississippi State, Coach Bellard returned to his Texas high school roots at the age of 61 and coached for six more years at Spring Westfield High School. Westfield had won four games combined the two seasons prior to Coach Bellard taking over. Under Coach Bellard, Westfield went 41-22-5 and reached the Class 5A Division I quarterfinals his last two seasons. After his Westfield stint, Coach Bellard finally retired from coaching for good and moved to Georgetown north of Austin, where he became a regular at Berry Creek Golf Club.

Emory Bellard is a bright thread in the fabric of Texas that makes this such a fascinating place. May his final days be restful ones. He will be missed.

Posted by Tom at 12:01 AM | Comments (1) |

August 12, 2010

Grad School?

A clever video for a new book (H/T Craig Newmark).

Posted by Tom at 5:27 AM | Comments (0) |

August 11, 2010

Too many laws, too many prisoners

The troubling overcriminalization of American life has been a frequent topic on this blog, so this excellent Economist article on the subject caught my eye.

After beginning with the example of the absurdly over-the-top local federal criminal case against local orchid importer George Norris, the article hammers home the stark statistics:

Justice is harsher in America than in any other rich country. Between 2.3m and 2.4m Americans are behind bars, roughly one in every 100 adults. If those on parole or probation are included, one adult in 31 is under correctional supervision. As a proportion of its total population, America incarcerates five times more people than Britain, nine times more than Germany and 12 times more than Japan. Overcrowding is the norm. Federal prisons house 60% more inmates than they were designed for. State lock-ups are only slightly less stuffed.

The system has three big flaws, say criminologists. First, it puts too many people away for too long. Second, it criminalises acts that need not be criminalised. Third, it is unpredictable. Many laws, especially federal ones, are so vaguely written that people cannot easily tell whether they have broken them.

In 1970 the proportion of Americans behind bars was below one in 400, compared with today's one in 100. Since then, the voters, alarmed at a surge in violent crime, have demanded fiercer sentences. Politicians have obliged. New laws have removed from judges much of their discretion to set a sentence that takes full account of the circumstances of the offence. Since no politician wants to be tarred as soft on crime, such laws, mandating minimum sentences, are seldom softened. On the contrary, they tend to get harder.

Of course, America's dubious drug prohibition policy fuels a substantial part of the prison industrial complex. Check out how supposedly enlightened Massachusetts handles certain drugs:

Massachusetts is a liberal state, but its drug laws are anything but. It treats opium-derived painkillers such as Percocet like hard drugs, if illicitly sold. Possession of a tiny amount (14-28 grams, or ½-1 ounce) yields a minimum sentence of three years. For 200 grams, it is 15 years, more than the minimum for armed rape. And the weight of the other substances with which a dealer mixes his drugs is included in the total, so 10 grams of opiates mixed with 190 grams of flour gets you 15 years.

And don't think for a moment that the ubiquitous law of unexpected consequences isn't at play with regard to this mess:

Severe drug laws have unintended consequences. Less than half of American cancer patients receive adequate painkillers, according to the American Pain Foundation, another pressure-group. One reason is that doctors are terrified of being accused of drug-trafficking if they over-prescribe. In 2004 William Hurwitz, a doctor specialising in the control of pain, was sentenced to 25 years in prison for prescribing pills that a few patients then resold on the black market. Virginia's board of medicine ruled that he had acted in good faith, but he still served nearly four years.

Here are previous posts dealing with the sad case of Dr. Hurwitz. And it gets worse:

There are over 4,000 federal crimes, and many times that number of regulations that carry criminal penalties. When analysts at the Congressional Research Service tried to count the number of separate offences on the books, they were forced to give up, exhausted. Rules concerning corporate governance or the environment are often impossible to understand, yet breaking them can land you in prison. In many criminal cases, the common-law requirement that a defendant must have a mens rea (ie, he must or should know that he is doing wrong) has been weakened or erased. [. . .]

"You're (probably) a federal criminal," declares Alex Kozinski, an appeals-court judge, in a provocative essay of that title. Making a false statement to a federal official is an offence. So is lying to someone who then repeats your lie to a federal official. Failing to prevent your employees from breaking regulations you have never heard of can be a crime. A boss got six months in prison because one of his workers accidentally broke a pipe, causing oil to spill into a river. "It didn't matter that he had no reason to learn about the [Clean Water Act's] labyrinth of regulations, since he was merely a railroad-construction supervisor," laments Judge Kozinski.

One of the most encouraging moments in the most recent presidential campaign was then-candidate Obama's willingness to address the overcriminalization problem by considering reform of America's abhorrent drug prohibition policy.

One of the most disappointing aspects of Obama's Presidency is his abandonment of that issue.

So it goes.

Posted by Tom at 12:01 AM | Comments (0) |

August 10, 2010

Matt Simmons, R.I.P.

The Houston business community is in mourning this week over the sudden death this past Sunday of Matt Simmons, the 67 year-old investment banker, author and pundit whose views were a common topic on this blog over the years.

Matt founded Simmons & Company in Houston in the mid-1970's with his brother L.E. as one of the first investment banks focusing on the increasingly important oil field service sector of the oil and gas industry. Simmons & Company eventually expanded into other areas of the energy industry and, by the late 1990's, became one of the top energy mergers and acquisitions investment banks in the country.

Around 1983 or so, Matt's firm and my law firm were on two of the floors near the top of the 700 Louisiana building in downtown Houston, so we developed a cordial friendship over the years by taking innumerable elevator rides together. I've always been involved in a fair amount of oil and gas litigation, so Matt was always interested in that part of my practice. And during the depression in the energy industry in Texas during the 1980's, Matt was arguably the most insightful businessperson in Houston at the time on the direction of the industry and how it's recovery should be structured.

Matt was a joy to talk with -- witty, intelligent and interesting. That's one of the reasons why, over the past decade or so, he became a media favorite for providing his provocative opinions about the energy industry. Matt enjoyed his new role as one of the media's energy industry pundits, but that wasn't the best fit for the chairman of a company that was often advising companies that could be affected by his controversial opinions.

Matt retired from day-to-day management of his company in 2005 about the time his peak-oil treatise was published, but he continued on as executive chairman to help the company maintain client relationships. Matt and the company formally split ties earlier this year when he made his utterly unsurprising public comments in Fortune magazine about the probability of a British Petroleum bankruptcy.

Sadly, I didn't see Matt again after the split, so I was never able to ask him about it. But my sense is that it was probably not that big a deal for him. He was working hard on his Ocean Energy Institute and I really think that is where his heart was as he segued into elder statesman status in the energy industry.

So, the local energy industry has lost a big part of its personality with the death of Matt Simmons. Many folks in the industry did not agree with some of Matt's often controversial views, but that never stopped him from expressing those views and forcing energy businesspeople to think about the issues and formulate alternative viewpoints toward them. That is a resource that is vitally important to all industries, particularly one that is facing the current challenges of the U.S. energy industry.

Yes, Matt Simmons will be missed. Rest in peace, friend.

Posted by Tom at 12:01 AM | Comments (0) |

August 9, 2010

An Inspirational Story to Begin the Week

Clear Thinkers favorite Tom V. Morris and his family experienced a nightmare last week, one that would stop us all in our tracks.

However, as Tom relates here, this particular nightmare turned into a remarkably inspirational tale about courage, grace and humanity.

As Tom observes:

As a philosopher, it's my job to study human nature. And it's not always a pretty picture. But on days when things go horribly wrong, we sometimes see ordinary people take extraordinary actions for no reason except that they're necessary. This is a simple and powerful reassurance of the basic goodness that can still be found in people. Airline agents, waiters, and regular people who see a need can sometimes do great things. I know only one of these recent heroes-on-the-scene by name. But I'm grateful to them all,  .   .  .

Amen!

Posted by Tom at 12:01 AM | Comments (0) |

August 8, 2010

The demise of Mark Hurd

The big news in the business world over the weekend is the resignation of Hewlett-Packard CEO Mark Hurd. Remember when he was viewed as the savior from another high-profile CEO?

Jeff Matthews thinks that Hurd's improprieties are not all that surprising given the type of accounting tricks he used to maintain H-P's market momentum.

And Bob Sutton passes along insight into the arrogance that may have been at the core of Hurd's demise.

Man, H-P sure must have been one interesting place to work over the past several years.

Posted by Tom at 12:01 AM | Comments (0) |

August 7, 2010

Where are all the villains?

Could it be that folks are finally realizing that old-fashioned greediness really should not be a crime?

Of course, the rationalization for the lack of villains now as compared to earlier crises has never been particularly compelling.

Business prosecutions over merely questionable business judgment obscure the true nature of risk and fuel the myth that investment loss results primarily from criminal misconduct. Taking business risk is what leads to valuable innovation and wealth creation. Throwing creative and productive business executives such as Michael Milken and Jeff Skilling in prison does nothing to educate investors about the true nature of risk and the importance of diversification.

Ignorance about business risk has led in part to the criminalization of business lottery. Such a lottery breeds cynicism and disrespect for the rule of law. Isn't it about time that dubious policy be put to permanent rest?

Posted by Tom at 12:01 AM | Comments (0) |

August 6, 2010

The Tiger Mike Memos

The oil and gas business in Houston has generated its share of characters over the past century. But few have been as colorful as Edward "Tiger Mike" Davis.

Tiger Mike owned an independent exploration and production company in Houston during the boom days of the late 1970's and early 80's, and then directed his company through a volatile chapter 11 case during the depression in the oil and gas industry in the mid-80's. I have always thought that one of the most impressive credentials of Fifth Circuit Court of Appeals Chief Judge Edith Jones is that she represented Tiger Mike during his company's chapter 11 case. Based on her representation of Tiger Mike alone, Edith definitely understands the challenge of representing a difficult client.

Legend has it that Tiger Mike was born in Lebanon, had no formal education and eventually emigrated to the US, where he was a cabbie in Denver. He was hired by wealthy Helen Bonfils' husband and remained her chauffeur after his death, which eventually led to his marriage with the 70 year-old widow. After her death, Tiger Mike inherited a part of her fortune, which he invested in several drilling rigs that he later sold at a substantial profit. That was his stake into the exploration and production business, where he proceeded to drill 50-odd dry holes and spiraled into bankruptcy.

The stories of Tiger Mike resonate in Houston oil and gas circles to this day. At one point, Tiger Mike was allegedly carrying on a torrid affair with one of the McGuire sisters (a popular singing group from the 1960's) at the same time as Ms McGuire was the mistress of Sam Giancana, the notorious Chicago Mafia boss. No one was ever quite sure whether Tiger Mike had Sam's consent to that arrangement.

Another time, during a particularly difficult work-out negotiations over a botched drilling project, Tiger Mike waltzed into a conference room filled with creditors and their lawyers in his trademark one-piece khaki polyester leisure suit with white shoes and belt. He proceeded to throw his briefcase on the conference room table, grabbed a 45 caliber pistol out of the briefcase and slammed it on the table to the astonishment of everyone in the room.

"Now,"� exclaimed Tiger Mike. "It's time to deal!"�

All of which is a prelude to the the always-observant Letters of Note's posting of the hilarious Tiger Mike Memos,� a series of 22 interoffice memos that the "incredibly amusing, painfully tactless, and seemingly constantly angry"� Tiger Mike sent to his employees over the years.�

To those of us in Houston who remember Tiger Mike, none of them are surprising in the slightest. But they are fun. Enjoy!  

Posted by Tom at 12:01 AM | Comments (0) |

August 5, 2010

Jeff Skilling requests his release from prison

During my unexpected absence from the blogosphere last week, the Seventh Circuit Court of Appeals released Conrad Black from prison pending his re-trial on various business fraud charges.

That got me to thinking about what was going on in Jeff Skilling's case on the same issue, so I checked in at the Fifth Circuit and found that Skilling has also requested his release from prison. That motion -- as well as Skilling's memorandum of law on why all remaining counts against him should be reversed and the entire case remanded for retrial -- are below.

These two documents arguably provide the best description yet of the unjust nature of the criminal case against Skilling. In short, the government knew that it had a flimsy case against Skilling on conventional securities fraud (he simply believed in and touted his company like any other CEO) and wire fraud charges (he didn't steal a dime from Enron).

So, the government relied on the defective honest services wire-fraud theory to convict Skilling of crimes based on amorphous, non-criminal acts such as not acting in the best interests of the company or promoting an unhealthy culture at Enron. Having relied heavily on the now-discredited honest services wire-fraud theory in obtaining convictions against Skilling on the more conventional charges, the government simply cannot prove beyond a reasonable doubt (it's burden on remand under such circumstances) that the jury did not rely on the acts relating to the honest services wire-fraud charges in convicting Skilling on the other charges.

It looks to me as if this case should be going back to the District Court for re-trial on all charges. Skilling and the government have agreed to an expedited briefing schedule on the issues and Skilling has requested that the Fifth Circuit review the matter on an expedited basis. Thus, look for a decision sometime next month.

Jeff Skilling's Motion to the Fifth Circuit Court of Appeals for Release Pending Retrial

Jeff Skilling Opening Merits Brief on Remand

Posted by Tom at 12:01 AM | Comments (0) |

August 4, 2010

I'm back

No, I really didn't intend to take almost a week off from blogging without letting you know.

But as I noted on Twitter a few days ago, when you think it's about time to change the company that hosts your blog, it's already too late. But more on that later.

The good news is that with the help of the trusty and multi-talented Deji Osinulu, HCT is back up and running. Some of the old images won't show for awhile and we'll be making some technical tweeks over the next few days. But the new host company (Arvixe) appears to be quite capable and responsive, so I do not anticipate any further problems.

Thank you for all the emails and social media messages during my brief absence from blogging. And thanks most of all for reading HCT.

Posted by Tom at 6:41 AM | Comments (0) |

July 29, 2010

The Extra Man

Posted by Tom at 12:00 AM | Comments (0) |

July 28, 2010

Those darn unintended consequences

Yesterday's post touches on the enormous direct costs attributable to the federal government's questionable policy of regulating business through criminalization of bad or simply incorrect business judgments.

However, as enormous as those direct costs are, the indirect costs of criminalizing bad business judgments dwarfs the direct ones.

Whether management makes such judgments correctly is a fundamental risk of business ownership. Criminalizing that risk -- through the prism of hindsight bias -- will simply make executives in the future less likely to take the risks necessary to build wealth and create jobs while not deterring in the slightest the Bernie Madoffs of the world from embezzling money.

Business owners deserve protection from theft, but not from risk taking, and it's not clear that government prosecutors know -- or even care about -- the difference.

Those indirect costs came to mind again as I read this Wall Street Journal article (H/T Russ Roberts) on the unintended consequences arising from the government?s new regulations concerning rating agencies:

Ford Motor Co.'s financing arm pulled plans to issue new debt, the first casualty of a bond market thrown into turmoil by the financial overhaul signed into law Wednesday.

Market participants said the auto maker pulled a recent deal, backed by packages of auto loans, because it was unable to use credit ratings in its offering documents, a legal requirement for such sales. The company declined to comment.

The nation's dominant ratings firms have in recent days refused to allow their ratings to be used in bond registration statements. The firms, including Moody's Investors Service, Standard & Poor's and Fitch Ratings, fear they will be exposed to new liability created by the Dodd-Frank law.

The law says that the ratings firms can be held legally liable for the quality of their ratings. In response, the firms yanked their consent to use the ratings, hoping for a reprieve from the Securities and Exchange Commission or Congress. The trouble is that asset-backed bonds are required by law to include ratings in official documents.

The result has been a shutdown of the market for asset-backed securities, a $1.4 trillion market that only recently clawed its way back to health after being nearly shuttered by the financial crisis.

Professor Roberts sums it up in his post by quoting Hayek:

"The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design."

Posted by Tom at 11:00 AM | Comments (1) |

The changing face of internal medicine

As noted here and here, my internist converted his practice to a successful concierge practice three years ago. In this recent KevinMD.com post, Dr. Steve Knope speculates that soon patients who are not a part of a concierge practice will not know their doctor if they have to go into the hospital:

What are the consequences for patients? What happens to the average person in Tucson, Arizona when he or she gets chest pain, develops pneumonia or has a seizure? Can they reach their internist or family practitioner for a medical emergency? Most patients who call their primary care doctor for a medical emergency can't even reach his staff during normal office hours. Instead, they will hear a recording on an answering machine, directing them to go to call "911" for any medical emergency.

Once in the ER, the doctorless patient will be admitted to a hospital physician, who is unknown to them. This so-called hospitalist, who is a salaried shift-worker, will put in his 12 hours, and then go home. He is a doctor who knows nothing about the patient's medical history. He has never met the patient. There will be no call from the hospital doctor to the primary care doctor in the office to get a thorough medical history. There will be no medical records transferred to the hospitalist. The hospitalist will attempt to get the best medical history he can from the patient, make some quick medical decisions, and then pass the patient off to one of his colleagues when his shift ends. And so it goes. No continuity of care, no understanding of the patient; the sick person now becomes a "case of pneumonia" or "the stroke in bed 3" to a group of unknown, rotating professionals.

Knope goes on to predict that as doctors flee from primary care (see earlier post here and here), the vacuum will be filled by nurse practitioners and medical assistants, who are far less trained in diagnostic procedures.

I don't know about you, but I'm making sure that my payments on my concierge practice account are current.

Posted by Tom at 10:50 AM | Comments (1) |

July 27, 2010

Ungagged.net: The Other Side of the Enron Story

A common topic on this blog has been the power of anti-business myths within American society.

Take Enron, for example. The anti-business myth contended that that Enron ? at one time one of the largest publicly-owned companies in the U.S. -- was really just an elaborate financial house of cards that a massive conspiracy hid from innocent and unsuspecting investors and employees.

The Enron Myth is so widely accepted that otherwise intelligent people reject any notion of ambiguity or fair-minded analysis in addressing facts and issues that call the morality play into question. The primary dynamics by which the myth is perpetuated are scapegoating and resentment, which are common themes of almost every mainstream media report on Enron.

The mainstream media -- always quick to embrace a simple morality play with innocent victims and dastardly villains -- was not about to complicate the story by pointing out that the investors in Enron could have hedged their risk of loss by buying insurance quite similar to that which Enron developed in creating their wealth in the first place.

Instead of attempting to examine and tell the nuanced story about what really happened at Enron, much of the mainstream media simply became a part of the mob that ultimately contributed to the death of Ken Lay and hailed the barbaric 24 year sentence of Jeff Skilling. Ambitious prosecutors, given wide latitude to obtain convictions of key Enron executives regardless of the evidence, gladly took advantage of the firestorm of anti-Enron public opinion to lead the mob.

As noted originally here and in many subsequent posts over the years, it is far more likely that the truth about Enron is that no massive conspiracy existed, that Skilling and Lay were not intending to mislead anyone and that the company was simply a highly-leveraged, trust-based business with a relatively low credit rating and a booming trading operation.

Although there is nothing inherently wrong with such a business model, it turned out it to be the wrong one to survive amidst choppy post-bubble, post-9/11 market conditions when the markets were spooked by revelations of the embezzlement of millions of dollars by Enron CFO Andy Fastow and a relative few of his minions.

The carnage of the Enron Myth is now piled high -- the destruction of Arthur Andersen, the death of Lay, the outrageous prosecutorial misconduct involved in the case against Lay and Skilling, the senseless prosecution and imprisonment of the four Merrill Lynch executives in the Nigerian Barge case, Richard Causey, Chris Calger, Kevin Howard, Joe Hirko and the other Enron Broadband defendants -- the list goes on and on.

In the wake of such destruction of careers and lives, the public is even less willing to confront the vacuity of the myth and the destructive dynamics by which it is perpetrated. indeed, even though what happened to Enron has now happened to Bear Stearns, Freddie and Fannie, Merrill Lynch, Lehman Brothers, AIG and any number of other trust-based businesses over the past two years, much of the public and the mainstream media still cling to the Enron Myth.

Attempting to challenge this enduring myth is a wonderful new resource -- Ungagged.net: The Other Side of the Enron Story.

Created, funded and filmed by Beth Stier -- who was the subject of prosecutorial misconduct as a non-party witness in the trial of the Enron Broadband case -- Ungagged.net is a "webumentary." That is, a website comprised of short modules of documentary-style content, organized into two main categories: "What It Was Like to Be on The Other Side of the Enron Story," and "Behind the Scenes of The Other Side of the Enron Story."

Ungagged.net currently features over a dozen relatives of defendants, attorneys, former Enron executives and employees telling their stories about what they experienced personally in dealing with the overwhelming governmental power and societal forces at work in the Enron saga. Moreover, six experts in economics, political science, finance, UK law and civil liberties -- including Clear Thinkers favorites William Anderson and Harvey Silverglate -- provide their views on the ominous implications that the government's handling of the Enron case have on us all.

Ms. Stier continues to add new information to the site, the latest of which are dozens of snippets from fascinating interviews of David Bermingham and Gary Mulgrew, two of the NatWest Three bankers from England who were caught up in an international firestorm in connection with the Enron Task Force's effort to turn Fastow and his right-hand man, Michael Kopper, into witnesses for the Task Force against Skilling and Lay. This series of interview modules paints an absolutely fascinating tale of three regular fellows from the U.K. having their lives, families and careers turned utterly upside down by governmental forces that viewed them as mere pawns in a much larger game.

Apart from the its egregious human toll and the serious abuse of state power that its promoters ignore, the Enron Myth?s devastating impact is that it obscures the true nature of investment risk and fuels the notion that investment loss results primarily from someone else's misconduct. As Larry Ribstein has been asking for years, do we really want to be sending a message to investors that risk is bad when it often leads to valuable innovation and wealth creation?

For example, self-settled derivative prepay transactions are not particularly intuitive (no product actually changes hands) and are not well-understood outside the trading business. Nevertheless, such transactions provide the valuable benefit of hedging risk for companies, who pass along that benefit to consumers in the form of lower prices for their products and services.

Do we really want to allow prosecutors and regulators to paint such beneficial transactions as frauds and then manipulate the public's ignorance to demonize innovative risk-takers who are attempting to create wealth? How does throwing creative and productive business executives such as Michael Milken and Jeff Skilling in prison do anything to educate investors about the true nature of risk and the importance of diversification and hedging?

Ungagged.net is currently a voice in the wilderness advocating against such governmental overreach. Here?s hoping that voice grows louder as those of us who are concerned by the pernicious growth of abusive governmental power listen to the stories and observations contained in this valuable resource.

The trailer for the webumentary is below.

Posted by Tom at 12:01 AM | Comments (4) |

July 26, 2010

Will Tiger catch Jack?

Charles Murray reasons (H/T Steve Sailer) that it is becoming statistically less probable that Tiger Woods will catch or exceed Jack Nicklaus' record of 18 major golf championships:

The combination of qualities that enabled Nicklaus to win 18 majors and has enabled Woods to win 14 is freakish.  .   .   .

The role of those psychological strengths is why so much of the commentary about Woods's play since he returned is beside the point. The commentators focus on whether his component skills are returning to their pre-scandal levels. He can return to precisely the same place on the bell curves of the component skills that he occupied before the meltdown in his personal life, but the package will not be the same. Tiger Woods has experienced a sort of concussion to that Chinese puzzle of psychological strengths, and there must be some residual damage that won't ever go away.

The long-term effects can be quite small. When we are talking about the extremes of human accomplishment, there is no wiggle room. The package changed at all is no longer at the one-in-many-millions extreme that is required. Woods will still be a sensational golfer, winning a lot of tournaments and probably a few more majors. But to predict that Woods can win five majors between now and the end of his career - something that only 17 other golfers have done in their entire careers - assumes that nothing in the last year has significantly degraded the freakish combination required for extreme accomplishment. I find that assumption untenable.

Murray may be right. As I noted after his last major championship in mid-2008, Woods' poorly-designed and excessive exercise regimen has damaged his body needlessly. Moreover, his swing has problems and his remarkable putting skills have eroded since his comeback, although that may simply be attributable to concentration problems stemming from the scandal and his pending divorce.

Add to those problems the fact that a half-dozen young, world-class players have emerged over the past two years to challenge for major championships and that only Ben Hogan (8) and Nicklaus (6) have won a large number of majors after the age of 35 (Woods will turn 35 later this year). 

Thus, what once looked like a sure thing isn't such a lock anymore. My sense is that Woods still can beat Nicklaus' record, but not unless he makes big changes in his training. And as noted earlier here, does Woods really have any true friends who can help him get pointed in the right direction?

Posted by Tom at 12:01 AM | Comments (0) |

July 25, 2010

Why is Timothy Geithner still Treasury Secretary?

I�ve been asking that question for almost a year now (see also here).

Craig Pirrong is asking the same question after Geithner�s comments about American business to a group of reporters at breakfast this past week.

Meanwhile, Larry Ribstein reviews the politics of supposedly �objective� governmental regulation.

Frankly, given abysmal leadership provided by both the Bush and Obama Administrations, it�s a testament to the resilience of American business that the economy hasn�t tanked worse than it has.

Posted by Tom at 12:01 AM | Comments (2) |

July 24, 2010

Mr. Robinson's Neighborhood

From a time when Eddie Murphy was very clever.

Posted by Tom at 12:00 AM | Comments (1) |

July 23, 2010

Cassano wins the lottery

Larry Ribstein notes that AIG scapegoat Joseph Cassano appears to have won in his turn enduring the criminalization-of-business lottery.

Meanwhile, Conrad Black was released from prison this week pending a re-trial of the charges against him, but he is ruined financially by his turn at the lottery.

And Jeff Skilling remains in prison and James Brown awaits another trial in his seven-year ordeal.

So, does the decision not to prosecute Cassano indicate a government move away from the lottery policy of regulating business?

I�ll believe it when I see it.

Posted by Tom at 12:01 AM | Comments (0) |

July 22, 2010

On Turning 40

Sounds as if Louis CK has a wise doctor.

Posted by Tom at 12:00 AM | Comments (0) |

July 21, 2010

Five myths about the death penalty

David Garland of New York University has a new book coming out later this year on a common topic on this blog, Peculiar Institution: America's Death Penalty in an Age of Abolition (Belknap 2010). He previews the book in this WaPo op-ed in which he addresses the following five myths of the death penalty:

1. The United States is a death-penalty nation.

2. The United States is out of step with Europe and the rest of the Western world.

3. This country has the death penalty because the public supports it.

4. The death penalty works.

5. The death penalty doesn't work.

Check out the entire article.

Posted by Tom at 12:01 AM | Comments (1) |

July 20, 2010

And you thought the TSA was bad?

The silliness of the federal government�s security theater policy has long been a common topic on this blog. But if you thought that the government�s security theater jobs program is bad, check out this first installment of the Dana Priest-William Arkin/Washington Post series on the explosion in the hiring of government contractors and employees doing top-secret work for the government�s intelligence agencies and programs:

After nine years of unprecedented spending and growth, the result is that the system put in place to keep the United States safe is so massive that its effectiveness is impossible to determine.  .   .   . Analysts who make sense of documents and conversations obtained by foreign and domestic spying share their judgment by publishing 50,000 intelligence reports each year � a volume so large that many are routinely ignored.  .  .  . Every day, collection systems at the National Security Agency intercept and store 1.7 billion e-mails, phone calls and other types of communications. The NSA sorts a fraction of those into 70 separate databases. The same problem bedevils every other intelligence agency, none of which have enough analysts and translators for all this work.

The first Post installment goes to detail the utter failure of the matrix of government intelligence resources to generate the quantity or quality of intelligence that would justify the billions of dollars being spent on them, while telling the all-too-familiar tale of Congress failing to require any meaningful accountability from the intelligence agencies.

All of which prompts one to wonder. We already know what happens when Wall Street crashes.

But with the explosive growth in the intelligence and security theater bureaucracies, as well as the growth in government that is just beginning in regard to Obamacare and the 2,000-plus page Dodd-Frank financial regulation reform legislation -- and not to overlook the bloated bureaucracy that already exists to enforce the federal government�s absurdly-complex tax laws � what happens when out-of-control government growth crashes?

Posted by Tom at 12:01 AM | Comments (0) |

July 19, 2010

The SEC’s strike suit against Goldman

As noted in April when the Securities and Exchange Commission brought its lawsuit against Goldman Sachs, the case was destined to settle with Goldman paying a hefty settlement, which the SEC announced last week. But Larry Ribstein expands on that thought in this timely post on what the proposed settlement means to the folly of the current reform movement regarding governmental regulation of financial firms:

The SEC is heralding the $550 million settlement in its suit against Goldman as �the largest penalty ever assessed against a financial services firm in the history of the SEC,� and �a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing.� Surely the agency had a strong incentive to try to use the Goldman settlement to obscure the memory of Madoff, Stanford and the Bank of America settlement. Meanwhile,today�s NYT concludes its Goldman story with a quote suggesting Goldman got off lightly.

The truth is far more disturbing: the SEC got a big payday in what would have been seen as a strike suit had it been a private securities class action lawyer. [.  .  .]

What clues on all this can be gleaned from a settlement that involves a huge amount of money but only an admission of a �mistake�?

The bottom line is that this suit has proved to be no more than a common �strike� suit, no better than the sort of private securities class actions that triggered Congressional reform 15 years ago. Instead of attorneys� fees, the SEC�s objective appears to have been purely political. In the end it extracted a ransom payment from Goldman so the firm could reclaim its reputation and get back to business.

The court must now review the settlement. It should take a cue from the dissenting Commissioners and reject it because of the puzzling and troubling inconsistency between the amount of the settlement and Goldman�s meaningless admissions. The SEC should have to prove exactly what Goldman did wrong. This will force Goldman to either litigate or make a meaningful settlement. Goldman is hardly an object of pity at this point. In any event, the issues here go far beyond Goldman to, among other things, the proper role and function of the SEC.

It is sad that the SEC not only cannot be trusted to find fraud, but that it can no longer be trusted to litigate and settle cases involving the supposed frauds that it finds. But this is where we find ourselves in the days following �financial reform.�

Expecting the SEC to regulate a firm as sophisticated as Goldman Sachs effectively is about as rational as investing one�s entire nest egg with Bernie Madoff or Allen Stanford.

Posted by Tom at 12:01 AM | Comments (0) |

July 18, 2010

Restrepo

I caught this remarkable documentary on Friday night at the Angelika. Anyone interested in the issues addressed in this earlier post will not want to miss it.

Posted by Tom at 12:00 AM | Comments (0) |

July 17, 2010

Fiddling with the Road Hole

Geoff Shackelford provides a good overview of how the R&A's fiddling with St. Andrews' iconic 17th hole is likely to have unintended consequences during this weekend's Open Championship.

Posted by Tom at 12:00 AM | Comments (0) |

July 16, 2010

On the future of education

Jesse Schell, who teaches game theory at Carnegie Mellon, provides his spot-on observations regarding the future of teaching and education. (H/T Jon Taplin).

Posted by Tom at 12:00 AM | Comments (0) |

July 15, 2010

The Rational Optimist

Following on this recent post, here is Matt Ridley's TED lecture:

Posted by Tom at 12:00 AM | Comments (0) |

July 14, 2010

Boomtown D.A.

After Le Affaire Rosenthal and the ensuing change at the top levels of the Harris County District Attorneys Office over the past couple of years, it's easy to forget that the local D.A's office was a model of stability and excellence during the previous generation.

Johnny B. Holmes, who ran the D.A.'s office for 21 years before retiring in 2001, is still relatively well-known to many Houstonians. But less well-known is that Holmes inherited a well-organized D.A.'s office from Carol Vance, who was D.A. from 1966-1979 and literally transformed the local office from a small-town outpost into one that other major cities copied.

I pass this along because I just finished reading Vance's autobiography, Boomtown D.A. (White Caps Media 2010) (it's not available through Amazon at this time, so I bought my copy through the publisher's site). For any long-time resident of Houston, it is a thoroughly enjoyable read. And for any attorney practicing in Houston, it is an essential read.

Vance was involved in his share of juicy cases, so the chapters on those cases are the meat of the book. Vance's big cases include the John Hill case of Blood and Money fame, the cases arising from the TSU race riot of 1967, the prosecution of two corrupt judges (District Judge Garth Bates and Supreme Court Justice Don Yarbrough), the amazing transformation of former UH professor Gerry Phelps, and the prosecutions of Elmer Wayne Henley and David Brooks, who were the sidekicks to the worst serial killer in Houston history.

Moreover, just as interesting to me as the big cases is Vance's explanation of how the D.A.'s office grew from a relatively small office that was easily overwhelmed by a big case into one that could take on virtually anything that was thrown at it. Vance had many people helping him with this task and he is effusive in his praise of those folks, many of whom went on to become successful judges and attorneys in Houston after leaving the D.A.'s office. And Vance has a field day describing his interactions with Houston's formidable criminal defense bar, including such legends as Percy Foreman and Richard "Racehorse" Haynes.

But most impressive is Vance's description of his efforts after leaving the D.A.'s office in becoming one of the leaders of prison care and reform in Texas. The Carol Vance Prison Unit in Sugar Land is named for him and has one of the lowest recidivism rates of any prison in the U.S., a result of that unit's robust Christian ministries that Vance nurtured and promoted.

Carol Vance is a remarkable man who became Harris County District Attorney at a key time in Houston's history. We are all the better for that. Check out his book and learn why. You won't be disappointed.

Update: The book's editor, Kit Sublett, passes along that Carol Vance will have a book signing at Brazos Bookstore on July 22nd, and that the book signing scheduled for July 31st at Murder by the Book has been postponed. Mr. Sublett also advises that the book is available at all Houston-area Barnes and Noble stores and the Barnes and Noble website.

Posted by Tom at 12:01 AM | Comments (3) |

July 13, 2010

James Brown's Hell

Does the end of convicting a business executive of a crime justify the means by which government prosecutors accomplish it?

James Brown, the former Merrill Lynch executive and one of the defendants in the Enron-related criminal case known as the Nigerian Barge case, has to be asking himself that question as he continues to endure what is now his seventh year of prosecutorial hell.

Even in the littered landscape of failed Enron-related prosecutions, the Nigerian Barge prosecution stands out for its sheer brazen nature.

As noted in this post from almost five years ago (!), the Nigerian Barge prosecution was baseless from the start and, as later developments revealed, trumped-up to boot.

But as Brown's Supplemental Memorandum below filed this past Friday explains, "trumped-up" is too kind a term to describe what the prosecutors did to Brown and his fellow Merrill co-defendants.

A quick history of the case is helpful. After prosecuting Arthur Andersen out of business in the intensely anti-business post-Enron climate of Houston in 2004, the Enron Task Force threatened to do the same to Merrill Lynch unless the firm served up some sacrificial lambs, which the firm did by offering up Brown and fellow Merrill executives Dan Bayly, Robert Furst, and William Fuhs.

Through a deferred prosecution agreement with Merrill, the Task Force hamstrung the Merrill defendants' defense by limiting access to other Merrill Lynch executives who were involved in the barge transaction and who would have testified favorably for the defendants. To make matters worse, the Task Force then intimidated other potentially exculpatory witnesses by threatening to indict them if they cooperated with the Merrill defendants' defense.

Thus, after bludgeoning a couple of plea deals from former Enron executives Ben Glisan and Michael Kopper, the Task Force proceeded to put on a paper-thin case against the Merrill defendants, which was good enough to obtain convictions in Houston's deeply-hostile environment in 2005 toward anyone having anything to do with Enron.

Of course, most of the convictions were vacated on appeal (and in Fuhs' case, thrown out completely). However, each of the Merrill defendants served over a year in prison during their appeal while their families endured the substantial human cost of this and other misguided Enron-related prosecution.

Even after the convictions of the Merrill defendants were vacated, the Department of Justice initially threatened to pursue a retrial of the three remaining Merrill executives. But then the DOJ recently dismissed all charges against Bayly, while Furst cut a favorable plea deal that will lead to a dismissal of the remaining charges against him.

So, logic dictates that the DOJ would dismiss its charges against Brown, the only remaining defendant. Right?

Well, not so fast.

The DOJ has inexplicably teed up another trial of Brown, who was the only one of the Merrill defendants who was convicted on additional charges of perjury and obstruction of justice for having the temerity of protesting his innocence to the grand jury that originally investigated the Nigerian Barge deal. Brown's new trial is currently scheduled to begin on September 20.

But in the meantime, Brown's legal team has been leafing through enormous amounts of exculpatory evidence that the Enron Task Force withheld from the Merrill defendants in connection with the first trial back in 2005, but which the DOJ has recently been forced to disclose.

The result of the Brown team's effort is set forth below in the Supplemental Memorandum in support of a motion for a new trial for Brown on the perjury and obstruction charges (the downloaded version of the memo is bookmarked in Adobe Acrobat to facilitate ease of review). The memorandum details the appalling length that the Enron Task Force went during the first trial in suppressing exculpatory evidence in favor of Brown and his co-defendants and generally disregarding the rule of law in order to obtain convictions. As the memorandum concludes:

The conclusion is now inescapable that the ETF engaged in a calculated, multi-step process to deprive Brown of his constitutional right to Due Process. (1) They repeatedly denied the existence of Brady material, told this court they had met their Brady obligations and fought vehemently against producing anything [exhibit reference and footnote omitted]. They highlighted only selected material in a veritable garden of Brady evidence -- much of their selections being vague, tangential or marginal -- while working around clear, declarative, relevant exculpatory material even in the same page, paragraph or document. (3) When ordered by the Court to produce summaries to the defense, they further redacted even the Brady material they had themselves highlighted and withheld the crucial facts that they had highlighted as Brady. (4) They egregiously capitalized on their misconduct at trial by making assertions that were directly belied by the exculpatory evidence they withheld.  .  .  .

The memorandum goes on to set out dozens of Brady violations, including charts that compare the exculpatory statements that the Enron Task Force withheld prior to the first trial with the incriminating statements that the Enron Task Force extracted from witnesses during that trial.

Folks, this is really bad stuff. But as bad as it is, I have not seen any mention of it in the mainstream media.

When is the mainstream media going to realize that the scandalous behavior of government prosecutors in prosecuting business executives in connection with the Enron case dwarfs the true crimes that were committed at Enron?

Or is the media's obdurate refusal to challenge the Enron narrative an even bigger scandal than the prosecution's misconduct?

James Brown Supplemental Memorandum in Support of Motion for a New Trial

Posted by Tom at 12:00 AM | Comments (1) |

July 12, 2010

The largest psychiatric hospital - America's prisons

An insightful Fault Lines segment examines how prison systems have become America's largest psychiatric hospitals, with a substantial focus on the Harris County and Texas prison systems.

Posted by Tom at 12:00 AM | Comments (1) |

July 11, 2010

The Most Dangerous Man in America

From First Run Features (H/T Rhetorics and Heretics).

Posted by Tom at 12:00 AM | Comments (0) |

July 10, 2010

A tough adversary

Posted by Tom at 8:21 AM | Comments (0) |

July 9, 2010

The Politics of Ignorance

If you tire of the seemingly endless demagogic blather that governmental officials and pundits often pass off as discussion of key societal issues, then be sure to read this insightful Will Wilkinson post on the politics of ignorance:

The problem [of ideologues elevating doctrine over wisdom] is heightened by the fact that the reading public generally enjoys ideologues more than three-handed scholars, and so the more ideological among ideologues find themselves with larger audiences and more numerous and remunerative opportunities to publicly opine.

What results is not so much an exercise in public reason as a smash-em-up reputation derby, where elites vie to increase their pull with the public and policymakers by disparaging ideological competitors. Moves in the reputation game take many forms, from sniffs of imperious condescension, to bald �stupidest man alive� name-calling, to self-congratulatory above-the-fray comments like this one. There is no reason to trust that this is a process through which truth unfolds.

In the absence of institutions that limit the scope of democratic authority over intractably complex policy questions, the best we can hope for is perhaps a tad more self-awareness among opinion elites about their tendencies toward dogmatism and for the rise of norms that do more to reward the honestly judicious and penalize highly-regarded doctrinaire assholes.

As noted earlier here and here, the instinct of most politicians and much of the mainstream media is to embrace simple �villain and victim� morality plays when attempting to explain a particular trouble.

Take, for example, investment loss. The more nuanced story about the financial decisions that underlie a failed investment strategy doesn't garner sufficient votes or sell enough newspapers to generate much interest from the demagogues or muckrakers. That's why we periodically endure witch hunts, such as the recent one demonizing speculators. That�s also why it's important that our leaders who are ignorant about the function of speculation in markets take a moment to understand its beneficial purpose.

Morality plays are comforting because they make it easy to identify and demonize the villains who are supposedly responsible for trouble. The truth is usually far more nuanced and complicated, but ultimately more rewarding to embrace.

Posted by Tom at 12:01 AM | Comments (1) |

July 8, 2010

Chippendales

An SNL classic.

Posted by Tom at 12:00 AM | Comments (0) |

July 7, 2010

At least tell him that he is a sacrificial lamb

Regular readers of this blog are familiar with the technique that federal prosecutors used in the post-Enron era to score easy convictions against businesspeople.

Threaten to go Arthur Andersen on a company, offer to let the company off the hook under a deferred prosecution agreement in return for offering up an executive or two as sacrificial lambs to be prosecuted, and then bludgeon the individual�s career, life and family into bits under the sledgehammer of the DOJ�s prosecutorial power.

Jamie Olis was arguably the first of those sacrificial lambs, and there were plenty in connection with the Enron-related prosecutions. Heck, the DOJ is even getting ready to tee up a re-trial of one such case this September.

But check out this example of DOJ brazenness that Ellen Podgor passes along. The DOJ enters into a deferred prosecution agreement with American Express and, as a part of the deal, has AE enter into a side-letter agreement that, absent the DOJ�s prior consent, prohibited AE executive Sergio Masvidal from obtaining employment with an AE unit or any company that bought the AE unit.

Given the DOJ�s heavy-handed approach in such matters, that part of the deferred prosecution agreement is not all that unusual. But one aspect of this particular deal was.

The DOJ didn�t bother to disclose the side-letter to either Masvidal or the District Court that approved the deferred prosecution agreement.

Masvidal eventually found out about it when he was denied employment by the company that bought the AE unit. So, he sued the DOJ, which eventually led to the DOJ�s issuance of the letter below, which admits that the DOJ did not disclose the side-letter to the District Court on purpose and that the DOJ�s investigation �did not reveal any evidence that Mr. Masvidal had committed any criminal offenses or violated any banking regulations.�

Now, do you still have any doubts that the same bunch was capable of this and this?

 

 

DOJ's Clearing Letter in Sergio Masvidal Case

Posted by Tom at 12:00 AM | Comments (3) |

July 6, 2010

"People are actually now sicker as they die"

As noted in earlier posts here and here -- as well as in connection with the final years of Dr. Michael DeBakey -- one of the thorniest issues facing reformers of the U.S. health care and health care finance systems is the extraordinary allocation of health care resources to end-of-life care.

This recent Marilynn Marchione/AP article frames the issues well:

Americans increasingly are treated to death, spending more time in hospitals in their final days, trying last-ditch treatments that often buy only weeks of time, and racking up bills that have made medical care a leading cause of bankruptcies.

More than 80 percent of people who die in the United States have a long, progressive illness such as cancer, heart failure or Alzheimer's disease.

More than 80 percent of such patients say they want to avoid hospitalization and intensive care when they are dying, according to the Dartmouth Atlas Project, which tracks health care trends.

Yet the numbers show that's not what is happening:

-- The average time spent in hospice and palliative care, which stresses comfort and quality of life once an illness is incurable, is falling because people are starting it too late. In 2008, one-third of people who received hospice care had it for a week or less, says the National Hospice and Palliative Care Organization.

-- Hospitalizations during the last six months of life are rising: from 1,302 per 1,000 Medicare recipients in 1996 to 1,441 in 2005, Dartmouth reports. Treating chronic illness in the last two years of life gobbles up nearly one-third of all Medicare dollars.

--People are actually now sicker as they die, and some find that treatments become a greater burden than the illness was, said Dr. Ira Byock, director of palliative care at Dartmouth-Hitchcock Medical Center. "Families may push for treatment, but there are worse things than having someone you love die," he said.

But if your family is facing the prospect of caring for elderly parents in their waning years, don't miss this extraordinary Katy Butler/NY Times Magazine article on the negative impact that an effective pacemaker had on the quality of her father's life in the final years of his life:

Until 2001, my two brothers and I -- all living in California -- assumed that our parents would enjoy long, robust old ages capped by some brief, undefined final illness. Thanks to their own healthful habits and a panoply of medical advances -- vaccines, antibiotics, airport defibrillators, 911 networks and the like -- they weren't likely to die prematurely of the pneumonias, influenzas and heart attacks that decimated previous generations. They walked every day. My mother practiced yoga. My father was writing a history of his birthplace, a small South African town.

In short, they were seemingly among the lucky ones for whom the American medical system, despite its fragmentation, inequity and waste, works quite well. Medicare and supplemental insurance paid for their specialists and their trusted Middletown internist, the lean, bespectacled Robert Fales, who, like them, was skeptical of medical overdoing. "I bonded with your parents, and you don't bond with everybody," he once told me. "It's easier to understand someone if they just tell it like it is from their heart and their soul."

They were also stoics and religious agnostics. They signed living wills and durable power-of-attorney documents for health care. My mother, who watched friends die slowly of cancer, had an underlined copy of the Hemlock Society's "Final Exit" in her bookcase. Even so, I watched them lose control of their lives to a set of perverse financial incentives -- for cardiologists, hospitals and especially the manufacturers of advanced medical devices -- skewed to promote maximum treatment. At a point hard to precisely define, they stopped being beneficiaries of the war on sudden death and became its victims.

My family and I have experienced both a sudden death of a still-vibrant parent and a slow one under the painful grip of dementia. There is no question that my mother, a former nurse, did not want to die in the manner that she did. But she did not have that choice.

And that lack of choice is at the root of this vexing problem facing us all.

Posted by Tom at 12:01 AM | Comments (2) |

July 5, 2010

Yankee Doodle and Bob Hope

Around the 4th of July, most everyone has seen James Cagney�s magnificent dancing performance in television re-runs of Yankee Doodle Dandy (1942). But Bob Hope could cut a mean lick on the dance floor, too, as reflected in this dance routine from The Seven Little Foys, in which Cagney reprises his Yankee Doodle role of George M. Cohan. Enjoy!

Posted by Tom at 12:00 AM | Comments (0) |

July 4, 2010

Is this the worst Stros team ever?

At the midway point of the 2010 season, this Stros club is making a strong case for that dubious distinction.

The Stros ballclub has had its share of bad teams over the years (1962-2010), but six teams stand out. The first four teams in the club's history --1962 (64-96), 1963 (66-96), 1964 (66-96) and 1965 (65-97) -- the 1991 team (65-97) and this season's club (32-49 through Friday night's game). No Stros team has lost more than 97 games in a season.

We knew before the season that this was going to be a bad season. But a review of the club's statistics relative to an average National League team reveals just how bad it has been and how bad it will probably be by the end of the season.

As regular readers of this blog know, I like to use the RCAA ("runs created against average") and RSAA ("runs saved against average") statistics, developed by Lee Sinins for his Sabermetric Baseball Encyclopedia, to provide a simple but revealing benchmark of how an MLB club or player is performing relative to other teams or players in its league.

RCAA reflects how many more (or fewer) runs that a team (or player) generates relative to a league-average team (or player). An exactly league-average team's (or player's) RCAA is zero.

Similarly, RSAA measures how many more (or fewer) runs that a pitching staff (or an individual pitcher) saves relative to a league-average pitching staff (or pitcher). As with RCAA, an exactly league-average pitcher's (or team's) RSAA is zero.

Moreover, RCAA and RSAA are particularly useful because they provide a useful benchmark comparison across eras because it shows how much better (or worse) a team's hitters and pitchers stacked up against an average team of hitters or pitcher staff during a season. That's really the best way to compare teams from different eras because comparing other hitting and pitching statistics -- such as on-base average, slugging percentage, OPS, earned run average, wins and hitting statistics against -- is often skewed between teams of hitter-friendly eras (i.e., up until this season, the past 20 seasons or so) versus pitchers of pitcher-friendly eras (i.e., such as the late 1960's and early 70's).

Comparing aggregate RCAA/RSAA scores of the six really bad Stros teams, the 2010 edition is already third worst in Stros history:

1. 1963 (-107/-68) = -175

2. 1964 (-138/ -4) =  -142

3. 2010 (-94/-46) = -140

4. 1962 (-101/-24) = -125

5. 1991 ( -39/ -74) = -113

6. 1965 (    3/-109) = -106

Through 81 games, the Stros hitters have created a mind-numbing 94 fewer runs than an average NL club of hitters would have created using the same number of outs. That's by far the worst in Major League Baseball (the Orioles are the next worst at -77) and -- with still 50% of the season to go -- already the fourth worst performance in Stros franchise history:

1    1964     -138  
2    1963     -107  
3    1962     -101  
4    2010       -94  
5    1989       -64  
6    1982       -63  
7    1968       -51  
8    1990       -49  
9    2006       -47  
10  2008      -46

Not one Stros regular player has a positive RCAA, which means that the Stros are comprised entirely of hitters who are generating fewer runs at various levels than what an average National League hitter would create. LF Carlos Lee (-13), SS Tommy Manzella (-16) (before going on the DL) and 3B Pedro Feliz (before he was benched) were among the worst performing regular players in the National League this season. In 81 games this season, the Stros have created an astounding 2 fewer runs on average per game than MLB's best-hitting club, the Yankees (71 RCAA).

Meanwhile, after muddling around league for the first quarter of the season, the Stros pitching staff has deteriorated to -46 during the second quarter of the season to the point that the staff is now 25th among the 30 MLB pitching staffs this season and is already the 15th worst RSAA in Stros history with half a season to go:

1    1967     -130  
2    1965     -109  
3    1975     -100  
4    1976       -89  
5    2007       -79  
6    2009       -77  
7    1996       -76  
8    1992       -75  
9    1991       -74  
10  1970       -71  
11  2000       -69  
12  1963       -68  
13  1995       -52  
14   1973      -51  
15   2010      -46  
16   1968      -43  
T17 1978      -42  
T17 1966      -42  
19    1988      -36  
20    1985      -35  

Only Roy Oswalt (8), Brett Myers (5), Matt Lindstrom (4) and Brandon Lyon (2) have positive RSAA's among regular Stros hurlers. Wandy Rodriguez (-13) and Bud Norris (-15) are among the worst performing starters in the National League

Inasmuch as the Stros are actively peddling assets such as Oswalt, Myers and 1B Lance Berkman (they would love to trade Lee, but no one in their right mind would take on his contract), there is a real chance that the club's RCAA and RSAA numbers could deteriorate even more during the second half of the season. If that occurs, breaking the club record of 97 losses in a season is a definite possibility.

By the way, one of the most distressing aspects of the Stros' demise has been the decline in hitting performance. Check out the Stros RCAA hitting performance for the club's final decade in the Astrodome, which was not a hitter-friendly ballpark:

1    1998      154  
2    1995      129  
3    1994      107  
4    1997      101  
5    1996        52  
6    1999        43  
7    1993        41  
8    1992        25  
9    1991       -39  
10  1990       -49

Now, compare that to the club's RCAA hitting performance during its first decade in Minute Maid Park, which is perceived as a hitter-friendly ballpark, but is really a neutral ballpark -- it favors neither hitters nor pitchers:

1    2000       88  
2    2001       64  
3    2004       50  
4    2002       13  
5    2003       10  
6    2007        -7  
7    2005      -26  
8    2009      -34  
9    2008      -46  
10  2006      -47

And this season's club is already at a --94 RCAA. Talk about a downward spiral! But that's what you get for a decade of lackluster drafts.

The Stros are playing out the string this season, but the remainder of the season doesn't have to be a waste of time. For example, view giving at bats to players such as Feliz and Geoff Blum as an utter waste of time. Instead, give young players in the system an opportunity to show what they can do at the MLB level. If the right deal comes along, then peddle the club's valuable assets for some solid hitting prospects. The lower levels of the farm system are starting to show some signs of life, so there is already hope even during what just might be the worst season in the history of the Houston Astros.

Posted by Tom at 12:01 AM | Comments (0) |

July 3, 2010

Cottonfields

Posted by Tom at 12:00 AM | Comments (0) |

July 2, 2010

Rational Optimism

Matt Ridley supplies a dose of good end-of-the-week vibes with this article based on his new book, The Rational Optimist (Harper 2010):

When I set out to write a book about the material progress of the human race, now published at The Rational Optimist, I was only dimly aware of how much better my life is now than it would have been if I had been born 50 years before. I knew that I have novel technologies at my disposal from synthetic fleeces and discount airlines to Facebook and satellite navigation. I knew that I could rely on advances in vaccines, transplants and sleeping pills. I knew that I could experience cleaner air and cleaner water at least in my own country. I knew that for Chinese and Japanese people life had grown much more wealthy. But I did not know the numbers.

Do you know the numbers? In 2005, compared with 1955, the average human being on Planet Earth earned nearly three times as much money (corrected for inflation), ate one-third more calories of food, buried one-third as many of her children and could expect to live one-third longer. All this during a half-century when the world population has more than doubled, so that far from being rationed by population pressure, the goods and services available to the people of the world have expanded. It is, by any standard, an astonishing human achievement.

We invent new technologies that decrease the amount of time that it takes to supply each other�s needs. The great theme of human history is that we increasingly work for each other. We exchange our own specialised and highly efficient fragments of production for everybody else�s. The �division of labour� Adam Smith called it, and it is still spreading. When a self-sufficient peasant moves to town and gets a job, supplying his own needs by buying them from others with the wages from his job, he can raise his standard of living and those he supplies with what he produces. [.  .  .]

So ask yourself this: with so much improvement behind us, why are we to expect only deterioration before us? I am quoting from an essay by Thomas Macaulay written in 1830, when pessimists were already promising doom:

�They were wrong then, and I think they are wrong now.�

Posted by Tom at 12:00 AM | Comments (0) |

July 1, 2010

A fork in the road for Dell?

Remember back when Micheal Dell and Austin-based Dell, Inc. were among the early beneficiaries of what Larry Ribstein brilliantly coined as the Apple Rule of the criminalization-of-business lottery?

Well, as Dell�s stock closed down yet again yesterday at $12.06 a share � far from the lofty $40 a share price of five years ago � this 24/7 Wall Street post makes clear that Dell was quite fortunate to have the benefit of the Apple Rule:

Some of the troubling behavior at Dell, which added up is an extraordinary amount for any large company, occurred when Michael Dell was CEO. All of it happened when he was the firm�s chairman. Dell can argue that his is a huge company. He cannot know what all 94,000 of his workers are doing at any one time. That is almost certainly true. But a company�s values are established at the top and that behavior is s a by-product of corporate culture.

I submit that there is no rational basis for criminalizing Jeff Skilling�s conduct as chief executive officer of Enron and not doing the same in regard to Michael Dell�s. Or Tim Geithner�s for that matter.

Michael Dell is not a criminal. But neither is Jeff Skilling and he remains locked up in a Colorado prison.

Posted by Tom at 12:01 AM | Comments (0) |

June 30, 2010

Financial Ed 101

It�s good to see that James Surowiecki has come around to my way of thinking that better investor education is far more likely to hedge the risk of future financial scandals than throwing a few business executives in prison:

The government�s new consumer-protection agency has the authority to �review and streamline� financial literacy programs, but that�s not enough. We really need something more like a financial equivalent of drivers� ed. There�s evidence that just improving basic calculation skills and inculcating a few key concepts could make a significant difference. One study of the few states that have mandated financial education in schools found that it had a surprisingly large impact on savings rates.   .   .   .The point isn�t to turn the average American into Warren Buffett but to help people avoid disasters and day-to-day choices that eat away at their bank accounts. The difference between knowing a little about your finances and knowing nothing can amount to hundreds of thousands of dollars over a lifetime. And, as the past ten years have shown us, the cost to society can be far greater than that.

Surowiecki is spot-on with his observation (as is this TGR post on Surowiecki's article), but the promoters of the Greed Narrative continue to protest -- what about the innocent victims who lost their nest eggs as a result of the collapse of a company such as Enron?

Well, one of the main reasons that those victims' nest eggs ever had value in the first place was because innovative executives such as Jeff Skilling and Ken Lay transformed Enron into the world's leading energy risk management company through the creative use of futures and options contracts to hedge price risk for natural gas producers and industrial consumers.

Although it�s fine to feel sorry for someone who loses money on an investment, the Greed Narrative ignores the fact that most of those "victims" who lost their nest eggs were imprudent in their investment strategy. Taking Enron as an example, those investors should have diversified their Enron holdings or bought a put on their Enron shares that would have allowed them to enjoy the rise in Enron's stock price while being protected by a floor in that share price if it fell below a certain value. Those are the type of precautions that a prudent � and well-educated � investor would take in regard investing in a trust-based business.

Incongruously, while virtually all of those Enron "victims" hedged the risk of their investment in their homes by purchasing homeowner's insurance, few of them hedged the risk of their investment in Enron stock. Most of them simply did not understand how Enron's risk management services created their nest egg in the first place. Thus, when those nest eggs evaporated during the bank run on Enron, those investors didn't even try to understand what truly had occurred. They simply embraced the easy-to-understand Greed Narrative.

The Greed Narrative's devastating impact is that it obscures the true nature of investment risk and fuels the myth that investment loss results primarily from someone else's misconduct. As Larry Ribstein has been asking for years, do we really want to be sending a message to investors that risk is bad when it often leads to valuable innovation and wealth creation?

Do we really want to allow prosecutors and regulators to paint such beneficial transactions as frauds and then manipulate the public's ignorance to demonize innovative risk-takers?

At a time when America desperately needs innovators and entrepreneurs to create jobs and wealth, better education for investors makes much more sense than the paths we have been taking.

Posted by Tom at 12:01 AM | Comments (3) |

June 29, 2010

To File or Not to File, That is BP’s Question

Ever since the Deepwater Horizon oil well blowout in late April, friends in my line of work and I have been debating whether British Petroleum is going to file a chapter 11 case to reorganize while dealing with the huge and still-to-be determined liabilities arising from the catastrophe.

As the spill spiraled out of control, my sense was that the question about a BP bankruptcy filing was not whether the company would file, but rather �when� and �where.� Just dealing with the tens of thousands of claims that will be asserted against BP in hundreds of courts across the U.S. cries out for centralized bankruptcy processing from a logistical standpoint, if nothing else.

But from a purely financial standpoint, the question of whether BP will need to file is a closer call. As Joe Schaefer outlines here, BP is a hugely profitable, hard-asset based company that is � at least on paper -- capable of weathering this financial firestorm outside of bankruptcy protection, particularly if the relief well is successful and restores investor confidence in BP�s capacity to deal with the liabilities. 

On the other hand, as Craig Pirrong reminds us (related NY Times article here), BP�s financial situation is perilous and could deteriorate with Enronesque speed if the markets lose trust in BP�s capacity to perform on its contractual obligations. Those CDS spreads are indeed ominous.

Stay tuned.

Posted by Tom at 12:01 AM | Comments (0) |

June 27, 2010

Late-Season Hawaii Surfin'

Posted by Tom at 12:00 AM | Comments (0) |

June 26, 2010

The Wall Street Journal’s inadequate apology

It's as if the nation's leading business newspaper doesn't want to face the ugly reality of what it helped create.

This Wall Street Journal editorial applauds the U.S. Supreme Court's opinion reversing Jeff Skilling's conviction on honest services wire fraud charges. But when it comes to the WSJ's role in fanning the flames of public disdain toward business executives that helped to allow this injustice to occur, the WSJ apologizes only to Conrad Black:

The Black and Skilling cases are precisely the kind involving high-profile, unsympathetic defendants in which willful prosecutors like Mr. Fitzgerald are inclined to abuse the honest services law. They know the media won't write about the legal complexities, and they know juries are often inclined to find a rich CEO guilty of something. We regret that in the case of Mr. Black, that failure of media oversight included us.

But what about an apology to Mr. Skilling? Take it from me WSJ, that lack of media oversight also included you in regard to the Skilling and other Enron-related criminal cases.

Indeed, four years ago the WSJ editorial board was patting the Enron Task Force on the back despite the fact that it was clear at the time that the Task Force had improperly applied the honest services wire fraud statute and engaged in massive prosecutorial misconduct in regard to the Skilling prosecution and numerous other Enron-related criminal prosecutions.

The WSJ's failure to admit its egregious failures in its coverage of Enron reminds me of a point that John Carney raised several years ago in regard to Eliot Spitzer's odious tenure as New York Attorney General:

Why didn't [the mainstream media covering Spitzer's investigation of Grasso] reveal the slimy tactics of the Spitzer squad? We suspect part of the problem was the fear of being "cut off" of access. Reporters compete for scoops, and often those scoops depend on sources who will leak information to them. In the NYSE case, reporters assigned to the story were largely at the mercy of the investigators, who could cut-off uncooperative reporters, leaving them without copy to bring to their editors while their competitors filed stories with the newest dirt. They probably felt - not unrealistically - that their very jobs were on the line.

This reveals an unfortunate state of affairs. Playing bugle boy while government officials call the tunes from behind a veil of anonymity is not investigative journalism - it's hardly journalism at all. It's closer to propaganda. It would have been far better had the journalists turned their backs on the Spitzer squad, or even revealed these tactics to the public. Sure they may have lost some "good" stories but they could have painted a truer picture of what was going on. But that's probably too much to hope for.

The same type of mainstream media dissonance went on in regard to the Enron-related prosecutions.

In point of fact, this Ayn Rand Institute press release that was issued in 2006 just a couple of months after the WSJ patted the Enron Task Force on the back is remarkably prescient in regard to the mainstream media's abysmal coverage of Enron in general and Skilling's trial, in particular:

The Media's Mistreatment of Jeff Skilling

Upon hearing the news that former Enron CEO Jeffrey Skilling was sentenced to 24 years, most Americans, trusting the newspaper articles and books they have read on Enron, think that justice has been served. But, said Alex Epstein, a junior fellow at the Ayn Rand Institute, "Jeff Skilling has not gotten justice, and the media bear a major portion of the blame.

"Few Americans know that during Skilling's trial, the prosecution came nowhere near proving its central allegation that Jeff Skilling engineered a conspiracy to defraud investors. Few know that Skilling, upon leaving Enron five months before its collapse, destroyed no documents, nor did anything else resembling a criminal cover-up. Few know that the prosecution, unable to prove a conspiracy, spent huge swaths of the trial taking pot-shots at Skilling with issues not even mentioned in the indictment, such as the failure of Skilling, a multi-millionaire many times over, to disclose a failed $50,000 investment to Enron's board.

"The media's mis-portrayal of the case against Skilling long predates the trial. Ever since the fall of Enron, most of the media have treated as fact every conceivable smear against Skilling made by ax-grinding prosecutors or ex-Enron employees, while treating as absurd Skilling's claim that he neither engineered a conspiracy nor lied to investors.

"There can be no doubt that the media's treatment of Skilling contributed to his conviction for a phantom conspiracy--and to the outrageous 24-year sentence that he has now received. And the mistreatment of Skilling is part of a broader trend: the trend of treating businessmen as guilty until proven innocent. Our journalists and intellectuals, accepting the idea that the pursuit of profit is morally tainted, assume that whenever anything goes wrong in business, it is the result of crooked behavior by greedy, rich CEOs--and slant their coverage accordingly. This practice is putting numerous innocent men in jail, and instilling terror throughout corporate America.

"During Skilling's appeal, let us call for the media to start treating Skilling--and all businessmen--fairly."

The WSJ was right to apologize to Lord Black. But it also owes one to Jeff Skilling, as well as to its readers.

Posted by Tom at 12:01 AM | Comments (3) |

June 25, 2010

Skilling wins at the Supreme Court

The U.S. Supreme Court vacated Jeff Skilling's criminal conviction yesterday on the charge of conspiracy to commit wire fraud under 18 U.S.C. 1346 ("Section 1346"), throwing his entire conviction on nineteen counts into question.

The Supreme Court also reversed Conrad Black's conviction on the same issue, as well as Bruce Weyhrauch's. Lyle Dennison has this excellent summary of the Court's opinion, while Larry Ribstein and Stephen Bainbridge provide their usual spot-on analysis of the opinion from a public policy standpoint.

Interestingly, most of the 114 page opinion deals with an issue on which the Court ruled against Skilling - i.e., that the trial should have been moved out of Houston because inflammatory media coverage made it impossible for Skilling to receive a fair trial.

Nonetheless, the Court's opinion was a resounding victory for Skilling as all nine justices agreed that Skilling did not commit honest services wire fraud. The only difference is that Justices Scalia, Thomas and Kennedy would have struck down Section 1346 entirely, while the majority simply restricted it's application to bribery and kickback cases.

The Court remanded the case to the Fifth Circuit Court of Appeals for further disposition consistent with the Court's opinion, primarily to determine whether the Skilling's conviction on the honest services wire fraud charge should lead to a reversal of most or all of the other counts of his conviction. As the Court notes in footnote 47 on page 50, the Fifth Circuit has already indicated that Skilling's conviction should be set aside in its entirety if any of its three bases ((1) honest services wire fraud, (2) money-or-property wire fraud and (3) securities fraud) is reversed, but the Supreme Court ordered the Fifth Circuit to review that issue again. In view of the fact that the Enron Task Force prosecution heavily relied on the honest services wire fraud charge in presenting its case to the jury against Skilling, my sense is that the Skilling team has the decidedly better argument that the prosecution's mistake in prosecuting him on that charge was not harmless error and that most or all of the rest of his conviction must be reversed.

Moreover, even though a majority of the Court ruled against Skilling on the issue of whether the trial court erred in not moving the trial away from Houston, Justice Sotomayor's lively dissent on that issue is the best part of the decision. Justice Sotomayor -- who is the most experienced trial judge on the Supreme Court at this time -- is clearly appalled at the trial court's screening of prospective jurors in the face of the overwhelmingly adverse media treatment of Skilling. Here are a few snippets [all citations to the record deleted]:

In concluding that the voir dire "adequately detect[ed]and defuse[d] juror bias," the Court downplays the extent of the community's antipathy toward Skilling and exaggerates the rigor of the jury selection process. The devastating impact of Enron's collapse and the relentless media coverage demanded exceptional care on the part of the District Court to ensure the seating of an impartial jury. While the procedures employed by the District Court might have been adequate in the typical high profile case, they did not suffice in the extraordinary circumstances of this case to safeguard Skilling's constitutional right to a fair trial before an impartial jury.[ .  .  .]

These deficiencies in the form and content of the voir dire questions contributed to a deeper problem: The District Court failed to make a sufficiently critical assessment of prospective jurors' assurances of impartiality. Although the Court insists otherwise, ante, at 26, the voir dire transcript indicates that the District Court essentially took jurors at their word when they promised to be fair. Indeed, the court declined to dismiss for cause any prospective juror who ultimately gave a clear assurance of impartiality, no matter how much equivocation preceded it.

Juror 29, for instance, wrote on her questionnaire that Skilling was "not an honest man." During questioning, she acknowledged having previously thought the defendants were guilty, and she disclosed that she lost $50,000 - $60,000 in her 401(k) as a result of Enron's collapse. But she ultimately agreed that she would be able to presume innocence. Noting that she "blame[d] Enron for the loss of her money" and appeared to have "unshakeable bias," Skilling's counsel challenged her for cause. The court, however, declined to remove her, stating that "she answered candidly she's going to have an open mind now" and "agree[ing] with the Government's assertion that we have to take her at her word/" As this Court has made plain, jurors' assurances of impartiality simply are not entitled to this sort of talismanic significance.   .   .  [.  .  .]

Indeed, the District Court's anemic questioning did little to dispel similar doubts about the impartiality of numerous other seated jurors and alternates. In my estimation, more than half of those seated made written and oral comments suggesting active antipathy toward the defendants. The majority thus misses the mark when it asserts that "Skilling's seated jurors . . . exhibited nothing like the display of bias shown in Irvin." 

Juror 10, for instance, reported on his written questionnaire that he knew several co-workers who owned Enron stock; that he personally may have owned Enron stock through a mutual fund; that he heard and read about the Enron cases from the "Houston Chronicle, all three Houston news channels, Fox news, talking with friends [and] co-workers, [and]Texas Lawyer Magazine"; that he believed Enron's collapse "was due to greed and mismanagement"; that "[i]f[Lay] did not know what was going on in his company, he was really a poor manager/leader"; and that the defendants were "suspect." During questioning, he said he "th[ought]" he could presume innocence and "believe[d]" he could put the Government to its proof, but he also acknowledged that he might have "some hesitancy" in telling people the government didn't prove its case.

[Footnote 21] The majority also notes that about two-thirds of the seated jurors and alternates (11 of 16) had no personal Enron connection. This means, of course, that five of the seated jurors and alternates did have connections to friends or colleagues who had lost jobs or money as a result of Enron's collapse -- a fact that does not strike me as particularly reassuring.

Meanwhile, the government's case against Skilling continues to look shaky in other respects. Largely overshadowed by the Supreme Court's decision is the fact that the Fifth Circuit's previous opinion invited Skilling to file a motion for new trial in the District Court based on issues of prosecutorial misconduct that Skilling raised after discovering the evidence after the trial. Specifically, the Fifth Circuit was particularly concerned about the failure of the Enron Task Force to comply with federal rules requiring the disclosure of exculpatory evidence to the defense from the Task Force's pre-trial interviews with main Skilling accuser and admitted felon, former Enron CFO Andrew Fastow.

Fastow testified at trial that he told Skilling about the Global Galactic agreement, which purportedly documented a series of illegal "side deals" between Fastow and former Enron chief accountant Richard Causey that guaranteed Fastow would not lose money on certain special purpose entities that he was managing. Skilling denied any knowledge of the purported agreement.

After Skilling's conviction, the Skilling defense team discovered Fastow interview notes that the Enron Task Force had failed to disclose to the Skilling team prior to trial. Among other things, those notes revealed that Fastow had told the Task Force lawyers that he didn't think he had told Skilling about the Global Galactic agreement. The Fifth Circuit characterized the Task Force's non-disclosure as "troubling" in inviting Skilling to file a motion for new trial with the District Court.

So, despite his resounding Supreme Court victory, Skilling's legal battles are not over. But slowly the truth about Enron and Skilling's role there is emerging from the cloud of prejudice under which he was tried, both in court and in the mainstream media.

The truth about Enron is that no massive conspiracy existed. In reality, Skilling and the late Ken Lay were not intending to mislead anyone and that the company was simply a highly-leveraged, trust-based business with a relatively low credit rating and a booming trading operation. Although there is nothing inherently wrong with such a business model, it turned out it to be the wrong one to survive amidst choppy post-bubble, post-9/11 conditions when the markets were spooked by revelations of the embezzlement of millions of dollars by Fastow and a few of his minions.

That Jeff Skilling did not predict that Enron would fail under those conditions does not make him a criminal. Unlike his main accusers Fastow and Ben Glisan, Skilling didn't embezzle a dime from Enron. Did he tirelessly advocate this highly-leveraged but innovative company that was dealing with difficult market conditions during 2001? You bet. But since when is it a crime for a CEO to be optimistic -- even overly-optimistic -- about his company?

Beyond the shattered lives and families, the real tragedy here is that the mainstream media's demonization of Skilling has distracted us from examining the tougher issues of what really caused Enron's demise and understanding the how such a company can be structured to survive in even the worst market conditions. It's a lot easier just to throw a good and decent man such as Jeff Skilling in jail and simply conclude that it was all his fault. But examining objectively what really occurred at Enron is far more likely to result in real justice.

Who knows? Such an approach might have even prepared us better to deal with this.

Posted by Tom at 12:01 AM | Comments (6) |

June 24, 2010

Hank Haney talks about Tiger Woods

Following on this post from last month on the truly interesting question about Tiger Woods, dont� miss this Guy Yocum/Golf Digest interview of Woods� former swing coach, Hank Haney (H/T Geoff Shackelford).

The entire interview is fascinating, but a couple of points stood out. First, Haney confirmed my suspicion that Woods� swing problems derive mainly from deteriorating confidence in his longer clubs:

Tiger has an overall lack of trust with his driver that manifests itself in different ways. One, he obviously swings extremely hard, and sometimes too fast. He feels like he isn't in the right place in his swing, or that he isn't going to hit the right shot, and the anxiety of that tends to make people speed up. The quest was to get him to make the same swing with his driver he did with his irons in terms of effort, speed, his head not tilting, rocking and dropping. He was like, "I need to fix that, I'm going to work on it, I'm working on it, I'm going to work on it, I understand," and so on, but I didn't see it to the extent I felt he needed.

The other observation that stood out to me are ones that Haney makes at the end of the interview regarding a topic that I noted during the immediate aftermath of his infamous car crash:

You've said that Tiger needs friends at such a difficult time in his life. Is it hard for such a high-profile individual to find friends?

Yes. Very hard. Especially true friends.

Is your friendship with Tiger on a peer level, or is there a big-brother quality to it?

I think some of my messages to Tiger were along the lines of a big brother, but I don't know if he ever viewed me that way. Remember, I'm 54 and he's 34. So I'm sure age is a factor with that.

How does he respond when you try to be close to him? Does he draw lines in the friendship?

Tiger's different. I'm sure that's why he's the golfer he is. I don't take that personally. It's not for me to judge how he should be.

At the end of the day, how well do you feel like you really know Tiger Woods?

I always felt like I knew Tiger from observing him. I did not feel like I knew him from knowing him.

Posted by Tom at 12:01 AM | Comments (1) |

June 23, 2010

What motivates us

Dan Pink presents thoughts on how to motivate people (H/T Political Calculations).

Posted by Tom at 12:00 AM | Comments (1) |

June 22, 2010

How important is knowing your Father?

Maybe pretty darn important, according to University of Texas researchers Karen Clark, Elizabeth Marquardt and Norval D. Glenn:

Each year, an estimated 30,000-60,000 children are born in this country via artificial insemination, but the number is only an educated guess. Neither the fertility industry nor any other entity is required to report on these statistics. The practice is not regulated, and the children�s health and well-being are not tracked.

In adoption, prospective parents go through a painstaking, systematic review, including home visits and detailed questions about their relationship, finances, even their sex life. With donor conception, the state requires absolutely none of that, and the effects of such a system on the people conceived this way have been largely unknown.

We set out to change that. We teamed up .   .   . to design and field a survey with a sample drawn from more than 1 million American households.

Our study, released this month by the Commission on Parenthood�s Future, focused on how young-adult donor offspring � and comparison samples of young adults who were raised by adoptive or biological parents � make sense of their identities and family experiences, how they approach reproductive technologies more generally and how they are faring on key outcomes. The study of 18- to 45-year-olds includes 485 who were conceived via sperm donation, 562 adopted as infants and 563 raised by their biological parents.

The results are surprising. While adoption is often the center of controversy, it turns out that sperm donation raises a host of different but equally complex issues.

Two-thirds of adult donor offspring agree with the statement �My sperm donor is half of who I am.� Nearly half are disturbed that money was involved in their conception. About two-thirds affirm the right of donor offspring to know the truth about their origins.

Regardless of socioeconomic status, donor offspring are twice as likely as those raised by biological parents to report problems with the law before age 25. They are more than twice as likely to report having struggled with substance abuse. And they are about 1.5 times as likely to report depression or other mental health problems.

As a group, the donor offspring in our study are suffering more than those who were adopted: hurting more, feeling more confused and feeling more isolated from their families. (And our study found that the adoptees on average are struggling more than those raised by their biological parents.)

Some feel like a �freak of nature� or a �lab experiment.� Others speak of the searching for their biological father in crowds, wondering if a man who resembles them could be �the one.� Still others speak of complicated emotional journeys and lost or damaged relationships with their families when they grow up.

Life is complicated.

Posted by Tom at 12:01 AM | Comments (0) |

June 21, 2010

Visiting a prison cell

The troubling U.S. incarceration rate and the dubious governmental policy of overcriminalization have been frequent topics on this blog. The toll of the overcriminalization policy on citizens and their families is incalculable.

Part of the problem in modifying this destructive policy is that the constituency of current and former prisoners and their families is not powerful politically. But another aspect of the problem is that most well-meaning citizens who could make a difference on this issue politically have never experienced the hell that is most prisons in the United States. It�s human nature to avoid addressing even an important issue that one has never had to confront personally.

That�s why this A Public Defender post is important � it provides penetrating insight into the destructive nature of our government�s overcriminalization policy:

I sat in a prison cell yesterday.  .   .   .

There was a bed � a small bed � that was the length of the room. At the foot of the bed a metal toilet, with no cover. Just beyond that the heavy metal door, with a slit for a window. The door was maybe 3 feet wide, if that. At the head of the bed, if you were laying on your right side, you�d be about half a foot away from an ugly metal desk with holes that pretended to be drawers. This could not have been more than a foot long. The bed was flush with one wall. The desk with the opposite.

The bed looked hard, cold and dirty. And that�s it. This particular cell happened to have a window at the head of the bed. A window looking out onto nothing. Any future inhabitant of this particular cell would have it good. It was a single. Across the narrow passageway from this cell was another, identical in every respect except two: it was a double cell and there was no window. (Here�s a post I wrote a while ago about a different take on prisons in a foreign country.) [.  .  .]

I willed myself to stand there, though, for a minute. To look around at the bare walls, the bare desk, the dirty toilet and imagine someone �living� there.

I even briefly closed my eyes and tried to picture myself there, day in and day out, for months, which turned into years, which turned into decades.

Would I survive? How does anyone? Would I give up and stop bathing, shaving, eating? Would I maintain my sanity or would I quickly decompensate? How long would it be before I�d want to kill myself? [.  .  .]

People in cells are lucky, though. The next portion of the tour took me to the dorm-style housing. Which is nothing like any dorm you�ve ever lived in. Imagine instead the makeshift MASH hospitals, or perhaps the busiest train station in your neighborhood at rush hour, except instead of standing, people are milling about a hundred bunk beds on that tiny platform.

There is no privacy, there is no solitude, there is no being left alone. You are part of a large crowd. You are in someone�s face and they are in yours. You are a collective. Day in and day out. You share your bedroom with 125 other people.

Leaving the prison, I asked my colleague: cell or dorm? There�s no debate. Cell. I�d rather lose my sanity by myself.

A truly civilized society would find a better way.

Posted by Tom at 12:01 AM | Comments (3) |

June 20, 2010

Amazing Ukulele

The remarkable Jake Shimabukuro: "One of the things I love about being a ukulele player is that no matter where I go in the world to play, the audience has such low expectations. [This is] a huge plus for sure."

Posted by Tom at 12:00 AM | Comments (0) |

June 19, 2010

Stand By Your Man

Posted by Tom at 12:01 AM | Comments (0) |

June 18, 2010

What could possibly go wrong?

Earlier in the week, Steve Malanga wrote about the municipal debt racquet in this WSJ op-ed. Not surprisingly, a good part of the article examined dubious decisions that local governments have made in financing sports palaces:

State and local borrowing as a percentage of the country�s GDP has risen to an all-time high of 22% in 2010 from 15%, with projections that it will reach 24% by 2012.

Even more disconcerting is what the borrowing now often finances. One favorite scheme for muni debt is giant and risky development projects.

California�s redevelopment regime is an object lesson. Starting in the 1950s, the state gave localities the right to create public agencies, funded by increases in property taxes, which can issue debt to finance redevelopment. A whopping 380 such entities now exist. They collect 10% of all property taxes�nearly $6 billion annually�and they have amassed $29 billion in debt never approved by voters for projects ranging from sports facilities to concert venues to retail malls, museums and convention centers.

Critics, including taxpayer groups, say most such agency projects add little economic value. Sometimes the outcome is much worse.

In 1999, Fresno conceived plans to revive its downtown area with various projects, including a baseball stadium for the minor-league Grizzlies, which it had lured from Phoenix. The city�s redevelopment agency floated some $46 million in bonds to build the stadium. But the Grizzlies fizzled in their new home, demanded a break on rent, threatening to skip town and stick taxpayers with the entire $3.4 million annual bond payment on the facility. The team is now receiving $700,000 in annual subsidies to stay in the city.

Adding to the city�s woes: Last June, another development project, the Fresno Metropolitan Museum, went bust, leaving the city�s taxpayers on the hook for three-quarters of a million dollars in annual debt payments.

Cities now also use taxpayer-financed debt to engage in fierce bidding wars that benefit private enterprises. Charlotte, N.C., for instance, won the bidding for the new Nascar all of Fame with a $154 million offer, funded by a new hotel tax dedicated to servicing bonds for constructing the hall. But the venue employs only about 115 people�and an economic development study estimated the increased annual tourism from the venture won�t even equal what a single Nascar race generates.

Why did politicians offer the deal? For the dubious and hard-to-quantify purpose of �branding� the city with a major attraction, according to the Charlotte Observer.

Yeah, we in Houston know all about financing those minor league stadiums. Anyone taking into consideration what we are going to do with that thing if the Dynamo and/or the MLS doesn�t make it?

If that weren�t bad enough, the WSJ�s Chris Rhoads chimed in yesterday with this article on the wasting, publicly-financed �assets� that Greece built for the 2004 Olympic Games:

Georges Kalaras used to view with pride the sports hall built near his home here for the 2004 Olympic competition in rhythmic gymnastics and ping pong. Now, he gets mad every time he jogs by.

"Look, it's locked!" shouted the 38-year-old Mr. Kalaras, who works for the Athens city water company. Two stray dogs tangling with each other behind a padlocked metal fence accounted for the only activity in the complex, which seats 5,200 people.

Mr. Kalaras figured the steel and glass hall, costing taxpayers $62 million, would provide recreational space in his neighborhood. Officials envisioned concerts or shops.

Instead, when the Olympic torch went out after the Athens Summer Games six years ago, the doors closed here, as well as at many of the 30-odd other sites built or renovated for the Olympics that summer.

The vacant venues, several of which dominate parts of the city's renovated Aegean coastline, have become some of the most visible reminders of Greece's age of excessive spending. Sites range from a softball stadium and kayaking facility to a beach volleyball stadium and a sailing marina. [.  .   .]

Even boosters of the Olympics are having second thoughts.

George Tziralis, a technology investor, in 2007 co-authored a glowing report declaring the venues as "greatly improving the quality of life of the inhabitants of these areas, providing valuable resources to the community and the economy."

On a recent afternoon, staring at a pile of bricks on the unfinished entrance behind a locked metal fence encircling the Olympic sailing marina, he was less upbeat.

"I hope you're calling this article 'The Nonsense of the Olympics,'" he said. Boats filled about a third of the 120 slips at the marina, which remains closed to people who aren't boat owners.

Later, Mr. Tziralis, 28, gestured out the window of his Opel Corsa at a huge, locked complex of mostly vacant Olympic properties, located on the former site of the city's old airport.

"There's no way there shouldn't be a park here six years after the Games!" he shouted.

That complex, which cost taxpayers $213 million, includes stadiums for field hockey, softball and baseball�sports with little or no following in Greece. The facility for canoeing and kayaking slalom at the site was to become a water amusement park. It didn't.

In light of the foregoing and last week�s lessons on governmental decision-making, what could possibly go wrong with this?

Posted by Tom at 12:01 AM | Comments (0) |

June 17, 2010

Michael Shermer on Self-Deception

Stick with this interesting lecture to the end.

Posted by Tom at 12:01 AM | Comments (0) |

June 16, 2010

The state of cancer research

Following on these recent posts on the state of cancer research, John Goodman provides this timely and lucid post on the problems with � as well as the direction of - cancer research:

Why so little progress [in cancer research despite the large amount of money spent on  it]?

Some researchers believe we have been using the wrong model. We�ve been trying to combat cancer the way we fight an infection initiated by the common cold. But cancer is very different from ordinary infections and colds.

Suppose you have strep throat. Your doctor prescribes an antibiotic and the drug immediately goes to work fighting it. Let�s say the antibiotic manages to kill 95% of the germs. That�s enough damage to allow your body�s natural defenses (white corpuscles) to take over and complete the clean-up job.

Now suppose we try to fight a cancerous tumor the same way. Let�s say that through chemotherapy and/or radiation therapy, doctors manage to kill 95% of the cancer cells. In this case, the white corpuscles won�t be able to pull off the clean-up, however. Once cancer cells multiply and become lethal, it�s an all-or-nothing proposition. As long as even a single cancer cell remains, it will eventually multiply again. And it will continue multiplying until the fight must be initiated all over again. Eventually the cancer will metastasize (spread all over your whole body), which is a virtual death sentence.

Unlike ordinary germs, therefore, in fighting a carcinogenic tumor you have to kill (or remove) every single cell. If even one cell survives, the cancer will return and become lethal again.

Strange as it may seem, cancer appears to disable the human immune system in much the same way as a fertilized egg in a woman�s womb. Why doesn�t the body�s immune system treat a fertilized egg as a foreign invader and try to attack and kill it? Because somehow the immune system is turned off. Cancer cells are able to do much the same thing. Although the ability of women to carry a fertilized egg is pro-life and cancer is anti-life, it seems likely that both phenomena act in the same biochemical way.

Somehow, cancer turns off our body�s natural defenses. Many researchers believe the most promising response, therefore, is to find a way to turn those defenses back on. By way of encouragement, consider that �nearly everyone by middle-age or older is riddled with�cancer cells and precancerous cells� that do not develop into large tumors. Somehow our body�s natural defenses are keeping them at bay. Could those same defenses be employed to take on more challenging tasks?

That is a good way of thinking about the two new drugs that were announced last week. Rather than fight cancer the way we fight ordinary infections, fighting cancer by liberating the body�s natural immune system seems to have much greater promise.

By the way, in case you missed it, U.S. News & World Report�s annual survey of U.S. hospitals recently ranked the University of Texas M.D. Anderson Cancer Center in Houston�s Texas Medical Center as the no. 1 cancer hospital in the country. Texas Children�s Hospital, which is literally across the street from M.D. Anderson in the Medical Center, is ranked as the no. 5 pediatric cancer hospital in the nation.

Posted by Tom at 12:01 AM | Comments (0) |

June 15, 2010

On Leadership

If you read just one article this week, make it this one (H/T Mike at Crime & Federalism)  � William Deresiewicz�s lecture to the plebe class at the United States Military Academy at West Point last year. A snippet:

That�s really the great mystery about bureaucracies. Why is it so often that the best people are stuck in the middle and the people who are running things�the leaders�are the mediocrities?

Because excellence isn�t usually what gets you up the greasy pole. What gets you up is a talent for maneuvering. Kissing up to the people above you, kicking down to the people below you. Pleasing your teachers, pleasing your superiors, picking a powerful mentor and riding his coattails until it�s time to stab him in the back. Jumping through hoops. Getting along by going along. Being whatever other people want you to be, so that it finally comes to seem that, like the manager of the Central Station, you have nothing inside you at all. Not taking stupid risks like trying to change how things are done or question why they�re done. Just keeping the routine going.

I tell you this to forewarn you, because I promise you that you will meet these people and you will find yourself in environments where what is rewarded above all is conformity. I tell you so you can decide to be a different kind of leader. And I tell you for one other reason.

As I thought about these things and put all these pieces together�the kind of students I had, the kind of leadership they were being trained for, the kind of leaders I saw in my own institution�I realized that this is a national problem. We have a crisis of leadership in this country, in every institution. Not just in government. Look at what happened to American corporations in recent decades, as all the old dinosaurs like General Motors or TWA or U.S. Steel fell apart. Look at what happened to Wall Street in just the last couple of years. [.  .   .]

We have a crisis of leadership in America because our overwhelming power and wealth, earned under earlier generations of leaders, made us complacent, and for too long we have been training leaders who only know how to keep the routine going. Who can answer questions, but don�t know how to ask them. Who can fulfill goals, but don�t know how to set them. Who think about how to get things done, but not whether they�re worth doing in the first place. What we have now are the greatest technocrats the world has ever seen, people who have been trained to be incredibly good at one specific thing, but who have no interest in anything beyond their area of expertise. What we don�t have are leaders.

What we don�t have, in other words, are thinkers. People who can think for themselves. People who can formulate a new direction: for the country, for a corporation or a college, for the Army�a new way of doing things, a new way of looking at things. People, in other words, with vision.

Posted by Tom at 12:01 AM | Comments (1) |

June 14, 2010

Stuff happens

In this NY Times op-ed, Richard Thaler picks up on a theme that Ken Rogoff and James Hamilton raised last week � the similarity between the miscalculation of risks relating to the Gulf of Mexico oil spill and the Wall Street financial crisis:

AS the oil spill in the Gulf of Mexico follows on the heels of the financial crisis, we can discern a toxic recipe for catastrophe. The ingredients include risks that are erroneously thought to be vanishingly small, complex technology that isn�t fully grasped by either top management or regulators, and tricky relationships among companies that are not sure how much they can count on their partners.

For the financial crisis, it has become clear that many chief executives and corporate directors were not aware of the risks taken by their trading desks and partners. Recent accusations against Goldman Sachs suggest the potential for conflicts of interest among banks, investors, hedge funds and rating agencies. And it is clear that regulators like the Securities and Exchange Commission, an agency staffed primarily with lawyers, are not well positioned to monitor the arcane trading strategies that helped produce the crisis.

The story of the oil crisis is still being written, but it seems clear that BP underestimated the risk of an accident. Tony Hayward, its C.E.O., called this kind of event a �one-in-a-million chance.� And while there is no way to know for sure, of course, whether BP was just extraordinarily unlucky, there is much evidence that people in general are not good at estimating the true chances of rare events, especially when human error may be involved. [.  .  .]

How can government reduce the frequency and the severity of future catastrophes? Companies that have the potential to create significant harm must be required to pay for the costs they inflict, either before or after the fact. Economists agree on this general approach. The problem is in putting such a policy into effect.

Suppose we try to tax companies in advance for activities that have the potential to harm society. First, we have to have some basis for estimating the costs they may inflict. But before the recent disasters, companies in both the financial and oil drilling sectors would have claimed that the events we are now trying to clean up were, well, one-in-a-million risks, suggesting a very low tax.

Alternatively, an offending party could be made to pay after the fact, by holding it responsible for the costs it imposes. BP has volunteered that it will pay for all damages it considers �legitimate,� but we can expect a fight over how to define that word.

.   .    .  Suppose a company worth only $1 billion was responsible for this accident. It would go bankrupt and we would be unable to collect. And if we aren�t careful, we will encourage companies that have enough money for collection to leave the drilling to those that don�t. [.  .  .]

We are left in a difficult place. Neither the private nor the public sector seems up to handling these kinds of problems. And we can�t simply wait for the next disaster, because, as people might say if they had to use G-rated language, stuff happens.

Professor Hamilton zeros in on the group dynamic that leads to the underestimation of risk:

I think part of the answer, for both toxic assets and toxic oil, has to do with a kind of groupthink that can take over among the smart folks who are supposed to be evaluating these risks.

It's so hard to be the one raising the possibility that real estate prices could decline nationally by 25% when it's never happened before and all the guys who say it won't are making money hand over fist.

And this interacts with the forces mentioned above. When the probability of spectacular failure appears remote, and moreover it hasn't happened yet, it's hard to set up incentives, whether you're talking about a corporation or a regulatory body, in which the person who makes sure that the risks stay contained is the person who gets rewarded. When everyone around you starts thinking that nothing can go wrong, it's hard for you not to do the same. It can become awfully lonely in those environments to try to be the voice of prudence.

Finally, Cato's Gerald O'Driscoll, Jr. notes the futility of reacting to the oil spill by implementing even more regulation:

What is the missed lesson from all this? When President George W. Bush had his Katrina moment, the federal government's bumbling response was blamed on him, on the Republicans, and on conservatives. Now it is President Obama's turn. His administration's faltering response to the disaster in the Gulf is attributed to his personal failings, staff ineptitude, communication failures, etc. And, of course, the two administrations have shared responsibility for the poor handling of the financial crisis.

A big-government conservative administration failed in crisis, as has a big-government liberal administration. The regulatory state did not prevent excessive risk taking whether in financial services, nor perhaps in offshore oil drilling. Government response to crises once they occur is slow and inept. All this is not because either Republicans or Democrats are in power, but because big government doesn't work. It can't deliver on its promises. Big government overpromises and underdelivers. In reaching to do more, big government accomplishes less. That is not an ideological statement, but an empirical observation.

In the case of financial services, virtually all the proposed regulatory reform offers more of the same. Additional regulations will be added to existing ones without addressing why existing ones failed to prevent the crisis. The same process will likely happen with respect to offshore drilling.

The oil spill has triggered an important debate about the value of off-shore drilling, and that debate might conclude that off-shore drilling generates more harm than benefit.

But despite the nightly photos and videos of the oil spill on television, it�s important to remember that drilling produces benefits in addition to its costs. Deep-sea drilling has been ongoing for decades with relatively few incidents that even come close to the current spill.

So, while this spill may reveal that deep-sea drilling is too risky, it�s also quite possible that this incident was simply the result of poor decision-making combined with bad luck, and that there is a nominal chance that it will reoccur.

And it is very difficult to regulate bad decision-making and bad luck.

Stuff happens, indeed.

Posted by Tom at 12:01 AM | Comments (3) |

June 13, 2010

"You've lost. You just don't know it."

Posted by Tom at 7:40 AM | Comments (0) |

June 12, 2010

"This is your time!"

I�m not an avid hockey fan, but I always enjoy watching the Stanley Cup finals each year. The incredible effort and passion of hockey of playoff hockey is endearing even for the casual observer. I was a bit disappointed that the Flyers lost the Cup to the Blackhawks in Game Six the other night because I envisioned their coach giving a pre-Game Seven speech similar to the one below that Kurt Russell delivered as Herb Brooks in �Miracle,� the fine 2004 movie about the 1980 U.S. Olympic Hockey team. Russell should have garnered an Academy Award nomination for his performance. Enjoy.

Posted by Tom at 12:01 AM | Comments (1) |

June 11, 2010

Lessons on governmental decision-making

This blog started in February 2004 and the first post about what to do with the Astrodome was in September 2004.

Over the intervening six years, there have been a couple of dozen posts about the various boondoggles that have been proposed for the Dome. To date, no one has put up a penny to redevelop the Dome.

Despite this dismal track record, Harris County officials are still dithering over what to do with the Dome.

At least the current proposals are similar to the one that I made a couple of years ago. That is really the only one that makes much sense for the facility. Typical to Harris County�s handling of this situation, there is no mention in the Chronicle article that Harris County officials have had any discussions with Texas Medical Center officials about development and financing of such a venture. Thus, at this point, it would appear that the only financing for such a project would be on the County's dole.

And in an amazing display of blindness, County officials are planning not to convert the land that the Dome sits on into badly needed additional parking for the Reliant Park area if the decision is made to raze the facility. Why not generate some revenue from the land to help pay off the $35 million in bond debt that still exists on the Dome?

Oh well. There are many lessons to be drawn from this experience, but two in particular:

1. If you can�t figure out what to do with something in six years, then it�s probably time to get rid of it; and

2. Don�t ever rely on governmental officials to make sound decisions.

Posted by Tom at 12:01 AM | Comments (1) |

June 10, 2010

Are you an Asker or a Guesser?

According to Andrea Donderi, as described here by The Guardian�s Oliver Burkeman, it depends on the culture in which you were raised:

We are raised, the theory runs, in one of two cultures.

In Ask culture, people grow up believing they can ask for anything � a favour, a pay rise� fully realising the answer may be no.

In Guess culture, by contrast, you avoid "putting a request into words unless you're pretty sure the answer will be yes� A key skill is putting out delicate feelers. If you do this with enough subtlety, you won't have to make the request directly; you'll get an offer. Even then, the offer may be genuine or pro forma; it takes yet more skill and delicacy to discern whether you should accept."

Neither's "wrong", but when an Asker meets a Guesser, unpleasantness results. An Asker won't think it's rude to request two weeks in your spare room, but a Guess culture person will hear it as presumptuous and resent the agony involved in saying no.  .   .   .

This is a spectrum, not a dichotomy, and it explains cross-cultural awkwardnesses, too. Brits and Americans get discombobulated doing business in Japan, because it's a Guess culture, yet experience Russians as rude, because they're diehard Askers.

Applying this to legal education, my sense is that law schools try to develop Askers into trial lawyers, while the die-hard Guessers among law students probably gravitate toward non-litigation areas. Off hand, I cannot recall in my experience a particularly effective litigator who was anything other than an Asker. On the other hand, I know a number of good deal lawyers who are Guessers. What do you think?

Posted by Tom at 12:01 AM | Comments (1) |

June 9, 2010

The futility of regulating failure

David Warren makes a remarkably lucid point about the dubious notion that governmental action is the proper remedy to any wrong:

Politicians try to pass laws against it; to create rules and regulations so complex and cumbersome that (as we saw in the BP disaster) an easily-corrupted "judgement call" bureaucracy must grant exemptions from them, in order for anything to function at all. When disaster strikes, they add more rules and regulations.

But more profoundly, the rules and regulations -- once they pass a point of irreducible complexity -- create a mindset in which those who should be thinking about safety are instead focused on rules and regulations. To those who see danger, the glib answer comes, citing all the safety standards that have been diligently observed.

From what we already know, this appears to be exactly what happened aboard Deepwater Horizon, and will not be rectified by the U.S. government's latest, very political decision, to use means both fair and foul to prosecute British Petroleum, and punish the rest of the oil industry for its mistakes.

Let me mention in passing that President Barack Obama was in no way responsible for the catastrophe, and that there is nothing he can do about it. He is being held to blame for "inaction," as wrongly as his predecessor was held to blame over Hurricane Katrina, by media and public unable to cope with the proposition that, "Stuff happens."

In a sense, Obama is hoist on his own petard. The man who blames Bush for everything now finds there are some things presidents cannot do. More deeply, the opposition party that persuades the public government can solve all their problems, discovers once in power there are problems their government cannot solve.

Alas, it will take more time than they have to learn the next lesson: that governments which try to solve the insoluble, more or less invariably, make each problem worse.

I like to dwell on the wisdom of our ancestors. It took us millennia to emerge from the primitive notion that a malignant agency must lie behind every unfortunate experience. Indeed, the Catholic Church spent centuries fighting folk pagan beliefs in things like evil fairies, and the whole notion the Devil can compel any person to act against his will -- only to watch an explosion of witch-hunting and related popular hysterias at the time of the Reformation.

In so many ways, the trend of post-Christian society today is back to pagan superstitions: to the belief that malice lies behind every misfortune, and to the related idea that various, essentially pagan charms can be used to ward off that to which all flesh is heir. The belief that, for instance, laws can be passed, that change the entire order of nature, is among the most irrational of these.

Sheer human stupidity is the cause of any number of human catastrophes -- including the stupidity of superstition itself. We need to re-embrace this concept; to hug the native incompetence within ourselves, and begin forgiving it in others.

Amen.

Posted by Tom at 12:01 AM | Comments (3) |

June 8, 2010

So, what have you done for me lately?

What on earth is University of Houston Athletic Director Mack Rhoades thinking?

With UH already being an afterthought in the ongoing negotiations over the reorganization of big-time college athletics, Rhoades this past Friday fired the best coach that UH has had over the past 20 years, baseball coach Rayner Noble.

Not exactly the way to inspire confidence in the alumni base, Mr. Rhoades. 

Only in his late-40's, Noble is already an institution at the University of Houston, where he has spent most of the past 30 years.

Noble initially came to UH in 1980 as an exceptional player from Houston's Spring Woods High School, where he was the ace of a pitching staff than included Roger Clemens. He became the first freshman in Southwest Conference history to start as a pitcher and in centerfield. In 1983, he won 12 games and posted a 1.32 ERA while becoming the first UH pitcher to be named a consensus All-American and the first UH player to win Southwest Conference Player of the Year honors.

Noble was drafted by the Astros in the 1983 Major League Baseball Draft and quickly moved up the Astros farm system. But after developing chronic tendonitis in his pitching elbow at the Triple-A level, Noble decided to go into coaching, initially as an assistant for long-time UH baseball coach Bragg Stockton and then helping Rice coach Wayne Graham in the early 1990's lay the foundation of the ultra-successful Rice program. During an era in which UH administrators were not making very good decisions, UH unexpectedly made the good decision to hire Noble as head baseball coach in 1994.

UH has been richly rewarded for that decision. Over the past 16 seasons, Noble guided the UH baseball program to three NCAA Super Regional berths over a four year period from 1999-2003, eight NCAA Regional appearances, three Conference USA regular-season titles and three C-USA Tournament championships. In so doing, he chalked up a 551-420 record, including a record-breaking 48 wins in both the 2000 and 2002 seasons.

With the exception of Leroy Burrell's elite UH track program, no other UH coach comes even close to Noble's accomplishments during that period.

But what made Rayner Noble truly special at UH was that he loved and understood his alma mater. Playing in an inferior conference and without comparable financial resources, UH could rarely compete with programs such as Texas, Texas A&M, Baylor or local powerhouse Rice for elite players coming out of high school. Consequently, Noble specialized in recruiting players who he could develop into solid college players.

In so doing, he developed a large number of excellent players, such as pitchers Ryan Wagner and Brad Sullivan, who in 2003 were the first UH players selected in the first-round of the MLB Draft.

Moreover, given his experience as a professional player, Noble understood the vagaries of fashioning a successful college career into a spot on an MLB roster. Thus, Noble always emphasized to his players the importance of completing their college education. Noble's players were true student-athletes - if a player didn't attend class, he didn't play for Rayner Noble. Several UH professors confided to me over the years that Noble was by for the easiest coach that they ever worked with in regard to an academic problem of a student-athlete. Not surprisingly, Noble was highly-respected and well-liked by most UH faculty members and administrators.

So, what was that performance, integrity, loyalty and wisdom worth when Noble's teams suffered back-to-back losing seasons over the past two seasons?

Apparently, not much.

Make no mistake about it, the firing of Rayner Noble is a sad commentary on the state of intercollegiate athletics. Rather than looking at the big picture and the enormous contributions that Noble has made to student-athletes and the school, AD Rhoades and UH made a decision based narrowly on short-term results at a time when UH athletics desperately needs to be thinking for the long term.

Without the financial resources of the other major Texas universities, the University of Houston used to stand for unusual commitment to its coaches. Bill Yeoman, Guy V. Lewis, and the late Dave Williams were examples of the long-term excellence that UH used to achieve in intercollegiate athletics as a result of that commitment.

The firing of Rayner Noble reminds us that UH dispensed with that wise policy long ago.

As a result, the University of Houston has just lost much more than a baseball coach. The university lost a part of its soul.

UH will find another baseball coach.

But that lost part of UH's soul will be much harder to replace.

Posted by Tom at 12:01 AM | Comments (3) |

June 7, 2010

University of Texas Golf Club, Austin, TX

Posted by Tom at 12:01 AM | Comments (0) |

June 6, 2010

The wisdom of John Wooden

Posted by Tom at 12:01 AM | Comments (2) |

June 5, 2010

Lake Austin Spa Resort

Posted by Tom at 12:10 AM | Comments (0) |

June 4, 2010

More Kiri

Last week, it was West Side Story. This week, the incomparable Tiri Te Kanawa sings O mio babbino caro.

Posted by Tom at 12:01 AM | Comments (0) |

June 3, 2010

The inner life of a cell

Posted by Tom at 12:00 AM | Comments (0) |

June 2, 2010

Obfuscation is government’s secret weapon

Over the past couple of years, Bill King has done a great job (and see generally here) of explaining how Houston�s unfunded public pension obligation represents a horrific burden on the city government�s financial condition.

Given that such obligations are clearly unsustainable, why does the city government continue to provide them?

Edward L. Glaeser provides the following particularly lucid explanation of the dynamic that leads to such profligacy:

On Friday, The New York Times ran a front-page article about pensions that took note of a 44-year-old retired police officer who receives an annual pension of $101,333 despite never having earned more than $74,000 a year in base pay. The article reported that in Yonkers alone �more than 100 retired police officers and firefighters are collecting pensions greater than their pay when they were working� and that �about 3,700 retired public workers in New York are now getting pensions of more than $100,000 a year, exempt from state and local taxes.�

The emotional response of many people is to vilify the retirees, but that�s a mistake. The individual police officers and firefighters were following the rules. They have jobs that require them to risk their lives in service of their communities, and large pensions are one payoff for accepting those risks and accepting relatively lower wages up front. I�m sure many of them are no less impatient than the rest of us and would have preferred to get more money in their 20s and less in their 50s.

The fault lies in the political process that makes their negotiating partners � state and local governments � more impatient than their employees. State and local governments don�t want to face the short-term consequences of paying higher wages, so they structure compensation in ways that defer the costs of each new deal for years.

Politics doesn�t just favor delayed compensation; it also favors forms of compensation that are particularly hard for people to evaluate. Governments almost always love obfuscation. The appeal of Fannie Mae and Freddie Mac was that they could subsidize homeownership without appearing to cost the taxpayers anything. Of course, they ended costing us plenty, just like hard-to-evaluate pension promises.

The rest of Glaeser�s post is here.

Sort of reminds one of this, this and this, eh?

Posted by Tom at 12:01 AM | Comments (1) |

June 1, 2010

Can psychiatry be a science?

Louis Menand�s New Yorker article earlier this year that reviewed a couple of new books on psychiatry in the context of the confusing state of psychiatric literature posed the compelling question that is the title of this post:

You go see a doctor. The doctor hears your story and prescribes an antidepressant. Do you take it?

However you go about making this decision, do not read the psychiatric literature. Everything in it, from the science (do the meds really work?) to the metaphysics (is depression really a disease?), will confuse you. There is little agreement about what causes depression and no consensus about what cures it. Virtually no scientist subscribes to the man-in-the-waiting-room theory, which is that depression is caused by a lack of serotonin, but many people report that they feel better when they take drugs that affect serotonin and other brain chemicals. [.  .  .]

.  .  . As a branch of medicine, depression seems to be a mess. Business, however, is extremely good. Between 1988, the year after Prozac was approved by the F.D.A., and 2000, adult use of antidepressants almost tripled. By 2005, one out of every ten Americans had a prescription for an antidepressant. IMS Health, a company that gathers data on health care, reports that in the United States in 2008 a hundred and sixty-four million prescriptions were written for antidepressants, and sales totalled $9.6 billion.

As a depressed person might ask, What does it all mean?

Following on that provocative article, Russ Roberts' essential EconTalk series this week presents this fascinating interview of Menand on the state of psychiatric knowledge and the scientific basis for making conclusions about current therapeutic approaches of battling it.

Although hard and fast conclusions are few, Menand is asking the right questions about a subject that desperately needs better societal understanding. His article and interview are valuable contributions to improving that understanding.

Posted by Tom at 12:01 AM | Comments (3) |

May 31, 2010

I Feel Pretty

Kiri Te Kanawa does Leonard Bernstein's classic from West Side Story.

Posted by Tom at 12:00 AM | Comments (0) |

May 30, 2010

The Music of the Night

Posted by Tom at 12:00 AM | Comments (0) |

May 29, 2010

Carnac the Magnificent

Posted by Tom at 12:00 AM | Comments (0) |

May 28, 2010

This just might make your day

Another Paul Potts? Self-developed talent is truly inspiring.

Posted by Tom at 12:00 AM | Comments (0) |

May 27, 2010

Children of the Taliban

Another fascinating TED video.

Posted by Tom at 12:00 AM | Comments (0) |

May 26, 2010

Fallon does Seinfeld

Pretty darn impressive.

Posted by Tom at 12:00 AM | Comments (0) |

May 25, 2010

Is the wild ride of Landry’s investors finally over?

Owning an interest in Houston-based Landry�s Restaurants, Inc. over the past several years has not been for the faint-hearted.

But maybe � just maybe � the patience of long-term holders of Landry�s stock is finally going to be rewarded.

This story began back in July of 2007 when Landry�s announced that it was delinquent in its regulatory filings with the SEC and that it was in need of refinancing over $400 million in debt in a rapidly deteriorating debt market. Shortly thereafter, the company sued some of its bondholders for declaring the company in technical default under their bonds, but the company quickly settled that litigation on not particularly good terms.

A few months later, Landry's announced in January 2008 that its CEO and major shareholder (39%), Tilman Fertitta, had made an offer to take the company private by buying the other 61% of the company's stock for $23.50 share, which worked to be a $1.3 billion deal, including debt.

Given the circumstances, that offer sounded pretty good, particularly given that the proposed purchase price was a 40% premium over the $16.67 share price at the time of the offer.

Unfortunately, a flurry of shareholder lawsuits followed Fertitta's bid. By early March, 2008, it was apparent that Fertitta's bid was so speculative that he hadn't even lined up financing for it.

So, in April of 2008, Fertitta lowered his offer to $21 per share because of "tighter credit markets", and Landry's board announced in June of that year that it had accepted that price.

But by the fall of 2008, the financial crisis on Wall Street had roiled credit markets even further and Hurricane Ike caused considerable damage to several Landry's properties.

So, in October of 2008, Fertitta lowered his offer to $13.50 per share.

Then, in mid January of 2009, Landry's announced that it was terminating the proposed deal with Fertitta. The reason was a bit convoluted, but the gist of it was that Landry's contended that the SEC was requiring the company to issue a proxy statement disclosing information about a confidential commitment letter from the lead lenders on the buyout deal.

Amidst all this, Landry's stock was tanking, closing at under $5 per share.

Meanwhile, while the take-private bids languished and the company's stock plummeted to historic lows, Fertitta continued to buy more Landry's stock so that he now controls somewhere in the neighborhood of 55% of the company's shares.

Yes, that's right. Despite Fertitta�s series of unsuccessful take-private offers over the previous couple of years, Landry's board failed to obtain a standstill agreement from Fertitta that would have prevented him from taking a majority equity position while Landry's stock price was tanking.

So, given all that, could Fertitta and the Landry's directors screw things up any worse?

How about proposing yet another deal in which Fertitta would buyout Landry's other shareholders in return for giving them an equity stake in a publicly-owned spin-off (Saltgrass Steakhouse) in a brutally competitive niche of the restaurant market?

After shareholders and the markets widely panned that spinoff proposal, Landry's board tentatively approved an offer from Fertitta to buy the balance of Landry's shares for $14.75 per share. Compared to the spinoff proposal, Fertitta's cash offer looked relatively good.

There was just one small problem with Fertitta's proposal. Under Delaware corporate law, Fertitta had to agree that his proposal was subject to a requirement that a majority of the Landry's shares that Fertitta did not control have to approve the deal.

Enter William Ackman and his Pershing Square Capital Management hedge fund. Pershing Square bought up a bunch of Landry's shares and announced that it opposed Fertitta's buyout offer.

So, assuming your head isn�t still spinning from all that, what�s the latest with Landry�s?

Yesterday, the Landry�s board accepted a $24-a-share takeover offer by Fertitta ($.50 more than his January 2008 offer back when he owned only 39% of the company), which makes for about $1.4 billion deal.

In addition, Landry�s has the right to shop Fertitta�s offer for 45-days in an effort to obtain a higher offer and doesn�t have to pay Fertitta a break-up fee if such a higher offer is obtained. Of course, no one other than Fertitta has shown any interest in acquiring Landry�s, but that�s a nice touch, anyway.

The deal has a couple of contingencies, including court approval of a partial settlement of Delaware class action litigation against Fertitta and certain company directors.

Likewise, the deal must be approved by a majority of shareholders not affiliated with Fertitta, namely Ackman and Pershing Capital. But given the pricing of the deal � and the profit that Pershing Capital looks to make on its investment � such approval would appear to have been lined up already. So, Landry�s investors may finally receive a decent payoff for their wild ride over the past three years.

As the past three years have shown, Landry�s investors shouldn�t count their chickens before this deal hatches. But if it does, you can count on one thing about Landry�s.

The days of Landry�s as a publicly-owned company are over. For good.

Update: Steve Davidoff doesn't think that Pershing Capital will necessarily play ball with Fertitta's bid. With the paucity of bidders for Landry's, it seems unlikely to me that Pershing Capital would take the risk of opposing the deal. But you never know in the wild world of Landry's.

Posted by Tom at 12:01 AM | Comments (0) |

May 24, 2010

The human cost of the criminalization of business

In the news and public relations business, Friday afternoon is a good time to float news that someone involved doesn't want many folks to notice. News tends to die over the weekend. Monday brings new news. Friday's news is already old.

This past Friday's news along those lines was that Joseph Cassano and other former American International Group executives involved in the AIG meltdown that almost brought the world's financial system to its knees would not be subjected to criminal prosecution.

Inasmuch as the same thing that happened to Enron in late 2001 happened to AIG in late 2008 (as I predicted it could happen in 2005), it's not particularly surprising that the federal government would like the news that it has elected not to pursue criminal charges against former AIG executives to die over the weekend news cycle. I mean, really. Other than acknowledging the randomness of the criminalization of business lottery, how could anyone rationalize the government's decision not to prosecute AIG executives, on one hand, with the government's brutal treatment of business executives involved in Enron-related business, on the other?

Well, some would say at least the government finally got the decision right in regard to the AIG executives. Better late than never, right? Cassano and the other AIG executives are still subject to multiple civil class action lawsuits in which the responsibility for AIG's meltdown will be allocated among all of the multiple parties involved. That's the way this type of thing should be handled, right?

Well, yes, except that all of the mainstream media reports that I read about the government's decision not to prosecute the AIG executives failed to mention that multiple business executives who did nothing other than be involved in transactions with AIG have already had their careers ruined and their lives uprooted by dubious criminal prosecutions.

Why weren't these men and their families spared the trauma of facing the brute force of a federal criminal prosecution and a prolonged prison sentence? Likewise, why were these men forced to endure the incalculable human cost of the government's criminalization-of-business policy?

Meanwhile, the human cost or that dubious policy continues to mount.

This past week, Joe Hirko, the former Enron Broadband executive who copped a plea bargain in the face of a draconian trial penalty, was visited by his wife Kathleen in the California prison where he is serving his sentence. During her visit, Mrs. Hirko was stricken by either a heart attack or stroke and died, leaving her husband, three children and four grandchildren to pick up the pieces of their lives. Unlike the news about the government's decision not to prosecute the AIG executives, Kathleen Hirko's tragic death did not even register a blip on the mainstream media's radar screen.

I wonder how much the past seven years of prosecutorial hell that the Hirko family endured contributed to Kathleen Hirko's death? And what beneficial public purpose did the infliction of that hell achieve?

A truly civil society would find a better way.

Posted by Tom at 12:01 AM | Comments (9) |

May 23, 2010

Getting ready to grill steaks?

Get some pointers on grilling those Memorial Day Weekend steaks from Epicurious.com�s Elizabeth Karmel.

Posted by Tom at 12:00 AM | Comments (0) |

May 22, 2010

Au revoir, Roy O

Inasmuch as the Stros have been one of the worst teams in Major League Baseball in three of the past four seasons, it�s understandable that longtime Stros ace Roy Oswalt has asked the club to trade him to a contender.

Although it almost happened one time before, I was hoping that Stros management would somehow pull a rabbit out its hat and cobble together a club that was good enough to entice Roy O to muddle through for a couple more seasons until the Stros� youth movement in the lower minors progressed to the big league club.

Alas, this season�s club is on track to be one of the worst � and quite possibly the worst � in Stros� history. So, that hope didn�t pan out.

But I will always appreciate Oswalt. As a lifetime follower of baseball and a 40-year follower of the Stros (and a season ticket holder for the past 25 seasons), Oswalt is the best pitcher that I�ve had the pleasure of watching live on a regular basis. He is likely the best pitcher that any of us Houstonians will ever watch live on a regular basis.

Drafted by the Stros in 1996 and developed within the Stros' heralded (at the time) minor league pitching program, Oswalt jumped from AA ball to the Stros in 2001 and quickly became one of the best pitchers in the National League. Remarkably durable throughout his career to date, Oswalt pitched the key win that vaulted the Stros into their first World Series in 2005 and has developed into one of the best pitchers in MLB history at this stage of his career.

As regular readers of this blog know, I think the statistic of runs saved against average (�RSAA�) provides the best measure to evaluate a pitcher during his career and against pitchers from other eras. RSAA measures how many more (or fewer) runs that a pitcher saves relative to a league-average pitcher during each season of his career (an exactly league-average pitcher RSAA is zero).

Thus, not only does it provide a good indication of how a pitcher compares to an average MLB pitcher during his career, RSAA provides a useful comparison across eras because it shows how much better (or worse) a pitcher stacked up against an average pitcher during his era. That's really the best way to compare pitchers from different eras because comparing other pitching statistics -- such as earned run average, wins and hitting statistics against -- is often skewed between pitchers of hitter-friendly eras (i.e., the era in which Oswalt has pitched) versus pitchers of pitcher-friendly eras (i.e., such as the late 1960's and early 70's).

Oswalt is 32 years old and has saved 229 more runs than an average NL pitcher would have saved in the same number of innings during his career. In the history of Major League Baseball, that�s the 32nd best performance for a pitcher 32 years and under. To give you an idea of the pitchers comparable to Oswalt at this stage of his career, Dodger great Don Drysdale is tied with Oswalt at 32nd and both Sandy Koufax (36th) and Bob Gibson (37th) are behind Oswalt. Within his next few starts, Oswalt will probably pass Ferguson Jenkins, who is 31st.

Since his debut in the 2001 season, Oswalt is 3rd in RSAA among MLB pitchers:

1    Roy Halladay                304  
2    Johan Santana             263  
3    Roy Oswalt                   229  
4    Brandon Webb             199  
5    Tim Hudson                  194  
6    Randy Johnson             193  
7    Mark Buehrle                181  
8    Curt Schilling                178  
9    Mariano Rivera             177  
10   C.C. Sabathia               172

And it really isn�t even close that Oswalt�s stellar RSAA makes him the best pitcher in Stros history:

1    Roy Oswalt                  229  
2    Roger Clemens            114  
3    Billy Wagner                  99  
4    Dave Smith                    75  
5    Octavio Dotel                67  
T6   Mike Hampton              60  
T6   Nolan Ryan                   60  
T8   Andy Pettitte              56  
T8   Wade Miller                  56  
10   Don Wilson                   55  
11   Joe Sambito                 53  
12   Brad Lidge                    46  
13   Larry Andersen             45  
14   Shane Reynolds            43  
T15  Mike Cuellar                 40  
T15  Mike Scott                   40  
17   Ken Forsch                    39  
18   Larry Dierker                 36  
19   J.R. Richard                  34  
20   Joe Niekro                    33

But beyond the statistics, the things that I most appreciate about Oswalt are the intangibles. His teammates and spectators love to watch him pitch because he wastes minimal time in between pitches. My sons and I over the years have coined games in which Oswalt pitched as �Roy O Specials� because they often last less than two and a half hours, which has become a rarity in Major League Baseball.

Moreover, Oswalt is the quintessential gamer. He continues to challenge hitters with the inside fastball and he has no problem throwing his wicked curve at any point in in the count. As they say in baseball parlance, Roy O �has a little turd in him.�

I am going to miss Roy O.

Posted by Tom at 12:01 AM | Comments (1) |

May 21, 2010

Iceland volcano time lapse

Check out Sean Stiegemeier's phenomenal piece of time-lapse photography.

Iceland, Eyjafjallaj�kull - May 1st and 2nd, 2010 from Sean Stiegemeier on Vimeo.

Posted by Tom at 12:00 AM | Comments (2) |

May 20, 2010

Is freedom possible without wealth?

From the fine HBO John Adams mini-series, Thomas Jefferson and Alexander Hamilton debate the relative importance of the creation of wealth to American society. Amazingly, the debate lives on today.

Posted by Tom at 12:00 AM | Comments (0) |

May 19, 2010

So much for the presumption of innocence

This post from late last year noted this self-righteous NY Times Magazine piece  in which Andrew Meier decried the Russian government's unjust prosecution and treatment of former Yukos chairman, Mikhail Khodorkovsky.

Meanwhile, the Times and most of the rest of the mainstream media have largely ignored the United States Government's unconscionable treatment of R. Allen Stanford, who is still awaiting trial in downtown Houston's Federal Detention Center. Stanford's current legal team -- which includes Harvard Law professor Alan Dershowitz -- has filed another motion seeking Stanford's release, this time on Constitutional grounds.

The deprivation of due process and other Constitutional arguments contained in Stanford's latest motion are interesting, but what is even more compelling is the description of what the government has done to Stanford while he is presumed to be innocent of the charges asserted against him:

Mr. Stanford, a man who is presumed to be innocent, is being, and has been, subjected to substantial and undeniable punishment long before the trial of his case has even begun. He has been physically assaulted; he has suffered significant medical injury and psychological debilitation; he was held in solitary confinement two separate times for a total of 40 days; he has been subjected to 335 days of pretrial incarceration as of May 18, 2010; and before his scheduled trial concludes, he will predictably serve another nonspeculative 439 days.

Pivotally, he has, and will continue to have his constitutional rights compromised, including his fundamental right to assist counsel in the preparation of his defense, to personally review even a small fraction of the evidence that is material to his prosecution, to locate exculpatory evidence, and to have his core cognitive faculties undiminished by unnecessary conditions of confinement in a high-security prison which, in a myriad of ways .   .  . have prevented and will prevent him from preparing for trial.  .  .  . [T]he conditions of confinement to which Mr. Stanford has been subjected have been and continue to be manifestly punitive. [.  .  .]

On June 18, 2009, when Mr. Stanford surrendered to authorities, he was a healthy 59 year-old man, with no substantial physical or mental health issues. Now, nearly one year in detention later, Mr. Stanford's pretrial incarceration has reduced him to a wreck of a man: he has suffered potentially life-impairing illnesses; he has been so savagely beaten that he has lost all feeling in the right side of his face and has lost near field vision in his right eye. The major injuries from his assault while in prison required reconstructive surgery under general anesthesia and was performed while he was under restraint.

Rather than placed in medical isolation or the general population to recover, immediately post-operation, Mr. Stanford was placed in the maximum security Special Housing Unit ("SHU") area of the prison where he remained detained in solitary confinement for roughly 23 days, and denied all outside human contact with the exception of his attorneys; extreme measures which are generally reserved for only the most violent of convicted criminals.

Mr. Stanford has experienced, according to the Declarations attached hereto, a precipitate, severe, and ongoing deterioration of his mental and emotional health caused by the conditions of his confinement. Mr. Stanford has, moreover, been denied his Sixth Amendment right to counsel, to assist counsel in the preparation of his defense, and has been for the entire 335 days of his ongoing critical pretrial period deprived of the requisite confidentiality of his discussions with his attorneys by enforced institutional review of every document which his attorneys wished to discuss with him during their meetings.

Trial of this case is not scheduled to begin until January 24, 2011, and is expected to last six months, bringing the total, non-speculative, duration of pretrial detention to a minimum of 774 days; well over two full years without a determination that he is guilty of any crime.

And just to make sure that Stanford will never be of any meaningful assistance to his defense counsel, get a load of the routine that Stanford faces each day of his expected six-month trial if he continues to be incarcerated during the trial:

Mr. Stanford's inability to assist counsel during trial will be magnified by the reality of the system for bringing detained defendants to court, which forces defendants to undergo procedures which result in elapsed time of 14-17 hours between wake-up in the morning and return to cell in the evening. The physically and mentally exhausting and degrading procedures which Mr. Stanford would be forced to endure day in and day out during the six month trial if he remains incarcerated -- procedures which leave insufficient time for sleep and virtually no time for additional preparation -- are roughly as follows:

The inmates are awakened at around 4:00 to 4:30 AM. A body search is done before leaving the cell.

They are then taken to a receiving area where they have to strip naked, go through another body search, and then given a set of green clothes.

The inmates are then placed in a concrete holding cell where they may sit for 2 to 3 hours. GEO guards come into the holding cell where they shackle the inmates' hands to a chain around their waist and shackle the ankles.

After they are shackled, the inmates are taken down to the first floor and placed in a van. After about a 30 minute wait, they are driven to the U.S. Marshal's office at the Federal Courthouse.

The inmates are then searched by the U.S. Marshals and placed in a steel cell where they wait until they are called and taken to their hearing. Mr. Stanford stated that he goes to the hearing with his shackles in place.

After the hearing, the inmates are taken back to the steel holding cell and they remain there until everyone is done with their hearing.

By the time all the hearings are done it can be anywhere from 5:00 to 7:00 PM. At that time, the inmates are taken to the van and driven back to the FDC.

At the FDC, the inmates strip naked, undergo a body search, and change back into their regular jail garb.

The inmates remain in the holding cell while a counselor spends 5 minutes with each inmate asking what happened at their hearing, whether they feel suicidal, etc. After everyone is interviewed, the inmates are taken back to their cells somewhere around 7:00 to 9:30 PM.

For years, we watched as an out-of-control federal task force - egged on by a vacuous media members - rode roughshod over local citizens' Constitutional protections. Now, before our eyes, the presumption of innocence has been eviscerated in the Stanford case with nary a peep of protest other than from Stanford's attorneys and a few bloggers.

"When the last law was down, and the Devil turned 'round on you, where would you hide, the laws all being flat? .  .  .[D]o you really thing you could stand upright in the winds that would blow then?"

Posted by Tom at 12:01 AM | Comments (4) |

May 18, 2010

I like Chris Christie's style

Posted by Tom at 12:00 AM | Comments (1) |

May 17, 2010

The shameful state of the Incarceration Nation

The troubling U.S. incarceration rate � a direct result of the governmental policy of overcriminalization � has been a frequent topic on this blog (here, here, here, here, here,here, here, here, here, here and here).

In this post from last fall, Scott Henson notes that Kings College in London now has available here its latest "World Prison Population List" that reflects that the United States remains a world leader in incarceration rate by a large margin:

The United States has the highest prison population rate in the world, 756 per 100,000 of the national population, followed by Russia (629), Rwanda (604), St Kitts & Nevis (588), Cuba (c.531), U.S. Virgin Is. (512), British Virgin Is. (488), Palau (478), Belarus (468), Belize (455), Bahamas (422), Georgia (415), American Samoa (410), Grenada (408) and Anguilla (401).

America�s dubious drug prohibition policy is one of the reasons for the high incarceration rate. However, as this Houston Politics/Chronicle blog post notes, this National Sheriffs� Association survey (H/T Doug Berman) reports that the United States imprisons many more mentally ill citizens than treating them in hospitals. This press release on the survey summarizes the sad story:

Americans with severe mental illnesses are three times more likely to be in jail or prison than in a psychiatric hospital, according to "More Mentally Ill Persons Are in Jails and Prisons Than Hospitals: A Survey of the States," a new report by the Treatment Advocacy Center and the National Sheriffs' Association.

"America's jails and prisons have once again become our mental hospitals," said James Pavle, executive director of the Treatment Advocacy Center, a nonprofit dedicated to removing barriers to timely and effective treatment of severe mental illnesses. "With minimal exception, incarceration has replaced hospitalization for thousands of individuals in every single state."

The odds of a seriously mentally ill individual being imprisoned rather than hospitalized are 3.2 to 1, state data shows. The report compares statistics from the U.S. Department of Health and Human Services and the Bureau of Justice Statistics collected during 2004 and 2005, respectively. The report also found a very strong correlation between those states that have more mentally ill persons in jails and prisons and those states that are spending less money on mental health services.

Severely mentally ill individuals suffering from diseases of the brain, such as schizophrenia and bipolar disorder, often do not receive the treatment they need in a hospital or outpatient setting. The consequences can be devastating � homelessness, victimization, incarceration, repeated hospitalization, and death.

"The present situation, whereby individuals with serious mental illnesses are being put into jails and prisons rather than into hospitals, is a disgrace to American medicine and to common decency and fairness," said study author E. Fuller Torrey, M.D., a research psychiatrist and founder of the Treatment Advocacy Center. "If societies are judged by how they treat their most disabled members, our society will be judged harshly indeed."

Recent studies suggest that at least 16 percent of inmates in jails and prisons have a serious mental illness. According to author and National Sheriffs' Association Executive Director Aaron Kennard, "Jails and prisons are not designed for treating patients, and law enforcement officials are not trained to be mental health professionals."

Ratios of imprisonment versus hospitalization vary from state to state, as the report indicates. On the low end, North Dakota has an equal number of mentally ill individuals in hospitals as in jails or prisons. By contrast, Arizona and Nevada have 10 times as many mentally ill individuals in prisons and jails than in hospitals.

Among the study's recommended solutions are for states to adopt effective assisted outpatient treatment laws to keep individuals with untreated brain disorders out of the criminal justice system and in treatment. Assisted outpatient treatment is a viable alternative to inpatient hospitalization because it allows courts to order certain individuals with brain disorders to comply with treatment while living in the community. Studies show assisted outpatient treatment drastically reduces hospitalization, homelessness, arrest, and incarceration among people with severe psychiatric disorders, while increasing adherence to treatment and overall quality of life.  .   .   .

More evidence of the myth of American exceptionalism?

Posted by Tom at 12:01 AM | Comments (4) |

May 16, 2010

What would Mao Zedong say?

Posted by Tom at 12:00 AM | Comments (1) |

May 15, 2010

Robert Furst's nightmare ends

So, after seven years, the Department of Justice finally rolled over with nary a whimper and agreed to end the absurdly unjust prosecution of former Merrill Lynch banker Robert Furst. As usual, the deal to dismiss all charges against Furst will receive a small fraction of the publicity that the mainstream media trumpeted for his tainted conviction. The deferred prosecution agreement is below.

Although surely a relief, the agreement must be bittersweet for Furst. His business career is badly damaged and has been effectively put on hold for the better part of a decade. And for what purpose?

That�s the question that we should be asking as we get ready for yet another round of the same type of senseless prosecutions than ensnared Furst.

UH Law Professor Geraldine Szott Moohr reminded us this week in the context of Jeff Skilling's pending Supreme Court appeal of the foreboding nature of the government's overwhelming prosecutorial power. As Sir Thomas More teaches us, "when the last law was down, and the Devil turned 'round on you, where would you hide, the laws all being flat? . . . do you really thing you could stand upright in the winds that would blow then?"

A truly civil society would find a better way.

Robert Furst Deferred Prosecution Deal

Posted by Tom at 12:00 AM | Comments (7) |

May 14, 2010

The War on Drugs goes viral

The perverse damage that federal and state drug prohibition policies impose on American citizens and our neighbors has been a frequent topic on this blog over the years.

In this must-read Reason.com article, Radley Balko reviews how America�s drug prohibition policies are increasingly being used as a basis for conducting Gestapo-like raids on American citizens:

Last week, a Columbia, Missouri, drug raid captured on video went viral. As of this morning, the video had garnered 950,000 views on YouTube. It has lit up message boards, blogs, and discussion groups around the Web, unleashing anger, resentment and even, regrettably, calls for violence against the police officers who conducted the raid.

I've been writing about and researching these raids for about five years, including raids that claimed the lives of innocent children, grandmothers, college students, and bystanders. Innocent families have been terrorized by cops who raided on bad information, or who raided the wrong home due to some careless mistake. There's never been a reaction like this one.

But despite all the anger the raid has inspired, the only thing unusual thing here is that the raid was captured on video, and that the video was subsequently released to the press. Everything else was routine. Save for the outrage coming from Columbia residents themselves, therefore, the mass anger directed at the Columbia Police Department over the last week is misdirected.

Raids just like the one captured in the video happen 100-150 times every day in America. Those angered by that video should probably look to their own communities. Odds are pretty good that your local police department is doing the same thing.

Meanwhile, after suggesting on the campaign trail that drug prohibition policies needed to be changed, President Obama has cynically and hypocritically retreated and now supports the federal government�s drug prohibition policy. Meanwhile, the enormous costs of the dubious policy continue to pile up.

America�s War on Drugs is lost. It is way past time that we require our leaders to acknowledge that and end it. Their war has now become a war on us.

Update: Scott Henson has more.

Posted by Tom at 12:01 AM | Comments (3) |

May 13, 2010

The truly interesting question about Tiger Woods

Is not how and when he is going to settle up with Elin. Or even when he is going to play again.

No, the most interesting question about Tiger is this -- What has happened to his golf swing?

As noted earlier here, I haven't been comfortable with the public flogging that Woods has taken and continues to take as a result of his personal indiscretions. Seemingly without any true friends and receiving more than his fair share of bad advice, I find it quite easy to have compassion for Woods.

But putting the less interesting personal issues aside. The swing -- what has happened?

Because Woods is the best golfer of our time, his swing has been heavily scrutinized over the years. Butch Harmon successfully refined the young Woods' upright stance and steep swing plane during Woods' early years on the PGA Tour. But Woods eventually grew tired of the outspoken Harmon and ended up with Hank Haney at the recommendation of Woods' pal, Mark O'Meara.

Haney teaches a one-plane swing, so Woods' swing became flatter and more around his body under Haney. Although Woods never has been the ball-striker of a Ben Hogan, after some initial questions (see also here), the Woods-Haney partnership took off when Woods won the Masters in 2005. Woods went on to win an incredible 51% of his PGA Tour starts from July 2006 through last year (32 wins total).

Woods captured six majors over that span, including the 2008 U.S. Open over Rocco Mediate that he somehow won playing on a broken leg and torn ACL. Even though I expressed concern about Woods' misguided training regimen at the time, it appeared that it was only a matter of time before Woods would break Jack Nicklaus' record of 18 major championships.

Haney then helped Woods return from reconstructive knee surgery in 2009 to win seven times, but none of them were major championships. Nevertheless, this season looked to be a good one for Woods as Pebble Beach and St. Andrews were in the rotation for major championships.

But then Woods personal life blew up and everything changed. Woods put his golf game on ice and missed the first three months of the season. Woods somehow tied for fourth at the Masters in his first start of the season, but he was clearly not sharp in doing so.

The last couple of weeks have been pretty ugly, what with the missed cut at Quail Hollow and a withdrawal at the Players Championship because of a sore neck. In the meantime, Woods had lost so much confidence in his swing that he was at the bottom of the both tournaments in terms of driving distance and accuracy.

To add insult to injury, Woods main competitor -- Masters champion Phil Mickelson -- is poised to overtake Woods as No. 1 in the World Rankings soon.

And now Haney is gone. So, what's going on?

Well, there certainly is no poverty of opinions. As a student of the golf swing, my sense is that Woods has lost confidence in his swing of the longer clubs, such as his driver, 3-metal and hybrids. He seems much more comfortable swinging his "control" clubs (mid and short irons). But for whatever reason, Woods' arms have become disconnected from his upper body during his swings with the longer clubs, which has resulted in a large number of mishits. As the mishits mounted and Woods' confidence waned, he also lost distance off the tee, which only aggravated Woods' frustration.

Jeff Ritter -- who is one of America's top young golf instructors -- does a very good job below of analyzing Woods' swing with the driver while comparing it to the swing of one of the best ball-strikers of all-time, Sam Snead.

Woods will probably rebound to the top levels of the game once he sorts out his personal life and straightens out his swing. But Woods' body is increasingly breaking down under the strain of high-level golf and a needlessly brutal training regimen, so regaining his physical health may be an even bigger problem than regaining some sense of emotional stability in his quest to top Nicklaus' record.

Posted by Tom at 12:00 AM | Comments (2) |

May 12, 2010

The Medicaid Contagion

This earlier post decried the failure of the Obama Administration�s reform of the U.S. health care finance system to address one of the fundamental problems with the system � the over-reliance on third-party payor of health care expenses.

Take Medicaid, which is the foundation of Obamacare�s insurance-for-all principle. As the Happy Hospitalist explains, Medicaid is a particularly shaky foundation:

Not accepting Medicaid used to be the in thing for primary care.  Only one internist out of thirty in Happy's town accepts new Medicaid patients.  That's nothing new.

However, this Medicaid contagion has now spread to subspecialty care. In a first of its kind for Happy's community, I learned that some subspecialty surgeons are no longer accepting Medicaid for outpatient evaluations.    Cash is king.  If they are forced to care for a Medicaid patient during ER call, they don't even bill Medicaid for the care.  The hassle factor outweighs the payment received.

Going to the ER does not guarantee you'll get a hospital admission which would mandate the physician to see you.  If you aren't sick enough to get admitted, you may get referred back to the subspecialist doctor  from the ER for an outpatient evaluation.  And the  front desk at the office will tell you  they don't accept Medicaid and will ask for a cash payment up front for a clinic evaluation.  They may be required to see you.  They aren't required to accept your insurance.

If a Medicaid patient shows up in the clinic as an outpatient referral from a primary care doctor's office, the patient is told they do not accept Medicaid and cash is necessary for an evaluation.  There is no where for the patient to go, except to the University Hospital 60 miles away.  The surgical clinic doesn't  offer cab vouchers like Happy's hospital does.  This is the current reality of Medicaid.  This is ObamaCare's cure to health care finance reform. 

Medicaid is not a solution. It's pollution.  Medicaid is an insult to physicians everywhere. [.  .  .]

A nation of disgruntled patients with all the insurance in the world, and no where to go.  Take it up with your Congressman I would say.  They are the ones that destroyed it.

Yes, but everyone will still have health insurance.

For whatever that�s worth.

Posted by Tom at 12:01 AM | Comments (0) |

May 11, 2010

My favorite Mayor

Is unquestionably Las Vegas� Oscar Goodman:

Q: Prior to politics, you represented accused organized crime figures. What�s the biggest difference between politics and the mob?

A: My clients gave me their word, and their word was their bond. They always paid me. They always thanked me at the end of the day.

In the political world, none of that happens. A politician�s word usually doesn�t mean a damn. His word is for the moment.

Posted by Tom at 12:01 AM | Comments (0) |

May 10, 2010

The MD Anderson – Anticancer Research Venture

This David Agus/TEDlecture from awhile back emphasized the need for new ideas and approaches in cancer research.

Along those lines, David Servan-Schreiber in the video below announces that he has teamed up with Houston�s MD Anderson Cancer Center in a new research project aimed at enhancing and bolstering cancer research and care. Dr. Servan-Schreiber�s website about the project is here.

Dr. Servan-Schreiber is the author of the best-selling book, Anticancer, A New Way of Life (Viking 2009). While serving as a clinical professor of psychiatry at the University of Pittsburgh School of Medicine, Servan-Schreiber underwent chemotherapy and surgery twice for brain cancer. After the second bout, Servan-Schreiber spent years researching a mass of scientific data on natural defenses against cancer. His book is the result of this experience and research.

As this Abigal Zuger/NY Times review notes, there is skepticism in the clinical research community regarding Servan-Schreiber�s conclusions and recommendations. So, M.D. Anderson�s interest in Servan-Schreiber�s approach is somewhat surprising.

Nevertheless, as Dr. Agus notes in his TED lecture, perhaps Servan-Schreiber�s ideas are the type that are needed to spur clinical research into better treatment protocols and innovative care procedures for cancer patients.

Posted by Tom at 12:01 AM | Comments (1) |

May 9, 2010

Passenger Side

One of the all-time great road songs, Passenger Side by Wilco.

Posted by Tom at 12:01 AM | Comments (0) |

May 8, 2010

Dylan 1966

Posted by Tom at 12:01 AM | Comments (2) |

May 7, 2010

Hayes Carll “Beaumont”

Posted by Tom at 12:01 AM | Comments (0) |

May 6, 2010

Truth in soccer stadium advertising

Why is it that the Chronicle ignores principles of truth-in-advertising (not to mention common sense) in each of its articles regarding the proposed downtown minor-league soccer stadium?

In this most recent Chron puff piece, Chronicle reporter Jose De Jesus Ortiz suggests that, based on the anecdotal observations of several stadium supporters, the new stadium will be an economic boon for the area near the stadium.

Of course, Ortiz doesn�t even mention the bountiful economic research that shows scant evidence of large increases in income or employment associated with professional sports or the construction of new stadiums.

If the Chronicle admitted that the economic benefits of the minor-league soccer stadium are questionable, but that the intangible benefits to the community override the financial risk of the deal, then at least the Chron�s support of the deal would be based upon an honest presentation of the issues.

Is that too much to expect?

Posted by Tom at 12:01 AM | Comments (1) |

May 5, 2010

The beneficial nature of derivatives

I don't watch much television news. But when I catch a glimpse these days, it always seems as if some politician is loudly declaring the need for more governmental financial regulation.

Mostly, the politicos contend that financial derivatives are dangerous instruments that are contrary to sound public policy. We have to protect those poor souls who bet against John Paulson, don't you see?

But the proponents of this view simply do not want to understand the nature of derivatives, just as most of the same ones didn't want to understand the valuable nature of the risk management of natural gas prices that Ken Lay and Jeff Skilling contributed to markets 20 years ago.

Derivatives are simply a way for an investor to warn by trading - that is, by putting his money where his mouth is - that he has information about an upcoming shift in the markets. That facilitates a transparent and well-informed marketplace.

However, heavily regulating traders from taking advantage of that valuable source of information only makes it more difficult for valuable information about market shifts to reach the marketplace. How is that good for investors seeking as transparent and well-informed marketplace as possible?

An underappreciated cause of the Wall Street crisis was the underlying information failure. As opposed to restricting trading, we ought to be finding ways to bring more information to the market faster so that prices can be adjusted promptly. Rather than demonizing folks who bet their money in bringing information to the marketplace, we ought to be encouraging them.

I won't hold my breath waiting for that to happen.

Posted by Tom at 12:01 AM | Comments (2) |

May 4, 2010

Gladwell on Operation Mincemeat and the vagaries of espionage

Don�t miss this clever Malcolm Gladwell/New Yorker review of �British journalist Ben Macintyre�s brilliant and almost absurdly entertaining Operation Mincemeat, the espionage caper that threw the Nazis off of the Allied invasion of Sicily:

On April 30, 1943, a fisherman came across a badly decomposed corpse floating in the water off the coast of Huelva, in southwestern Spain. The body was of an adult male dressed in a trenchcoat, a uniform, and boots, with a black attach� case chained to his waist. His wallet identified him as Major William Martin, of the Royal Marines. [.  .  .]

It did not take long for word of the downed officer to make its way to German intelligence agents in the region. Spain was a neutral country, but much of its military was pro-German, and the Nazis found an officer in the Spanish general staff who was willing to help. A thin metal rod was inserted into the envelope; the documents were then wound around it and slid out through a gap, without disturbing the envelope�s seals. What the officer discovered was astounding.

Major Martin was a courier, carrying a personal letter from Lieutenant General Archibald Nye, the vice-chief of the Imperial General Staff, in London, to General Harold Alexander, the senior British officer under Eisenhower in Tunisia. Nye�s letter spelled out what Allied intentions were in southern Europe. American and British forces planned to cross the Mediterranean from their positions in North Africa, and launch an attack on German-held Greece and Sardinia. Hitler transferred a Panzer division from France to the Peloponnese, in Greece, and the German military command sent an urgent message to the head of its forces in the region: �The measures to be taken in Sardinia and the Peloponnese have priority over any others.�

The Germans did not realize�until it was too late�that �William Martin� was a fiction. The man they took to be a high-level courier was a mentally ill vagrant who had eaten rat poison; his body had been liberated from a London morgue and dressed up in officer�s clothing. The letter was a fake, and the frantic messages between London and Madrid a carefully choreographed act. When a hundred and sixty thousand Allied troops invaded Sicily on July 10, 1943, it became clear that the Germans had fallen victim to one of the most remarkable deceptions in modern military history.

Gladwell goes on to summarize the tale of how the Nazis fell for the caper, but then ponders whether espionage is really worth the trouble:

In the case of Operation Mincemeat, Germany�s spies told their superiors that something false was actually true (even though, secretly, some of those spies might have known better), and Germany acted on it. In the case of Cicero, Germany�s spies told their superiors that something was true that may indeed have been true, though maybe wasn�t, or maybe was true for a while and not true for a while, depending on whether you believe the word of someone two decades after the war was over�and in this case Germany didn�t really act on it at all. Looking at that track record, you have to wonder if Germany would have been better off not having any spies at all.

And the money quote:

Translation: the proper function of spies is to remind those who rely on spies that the kinds of thing found out by spies can't be trusted.

Read the entire review.

Posted by Tom at 12:01 AM | Comments (0) |

May 3, 2010

The next victim of the criminalization-of-business lottery?

Although it really shouldn't have surprised anyone, the big business news at the end of last week was the the Department of Justice had opened up a criminal probe of Goldman Sachs well before the filing of the SEC's lawsuit a couple of weeks ago.

Craig Pirrong provides his typically lucid perspective toward the news, while the Epicurean Dealmaker insightfully notes a dynamic involved in the growing cascade against Goldman Sachs that should concern us all. Interestingly, that dynamic is the same one that was involved in the prosecution to death of former Enron chairman, Ken Lay.

Frankly, after almost a decade of misdirected prosecutions of businesspeople, it's confounding that many citizens believe that a prosecution of Goldman Sachs would serve any useful public interest.

It is indisputable that government cannot possibly discover or prosecute all business fraud. But government policies that purport to prevent fraud by prosecuting simply prompt private parties to be less careful in detecting or avoiding fraud in the first place.

Moreover, the utter randomness of the criminalization-of-business policy undermines the public's respect for the rule of law. For example, who can possibly keep up with all the rules that government has invoked in determining whether an important businessperson gets prosecuted for a supposed business crime?

First, there was the Apple Rule, which was quickly followed by the Dell Rule.

Then there was the Buffett Rule, closely followed by the GM Rule.

And who could forget the Geithner Rule?

Frankly, the rule of law has been replaced by what Larry Ribstein has coined the criminalization-of-business lottery where winning or losing becomes random.

For instance, the owners of Long Term Capital Management may have been the earliest winners in the most recent era. On the other hand, Jamie Olis may have been the earliest big loser.

Martha Stewart lost, but at least never lost her business enterprise. Frank Quattrone also lost, but then he won, although I suspect that he believes that he lost overall.

Subsequently, Theodore Sihpol won while Bill Fuhs and his family lost a year of his life before he won, too. But he and his family will never get that year back.

And no one lost bigger than Jeff Skilling.

Meanwhile, although mainstream media darlings Steve Jobs and Warren Buffett won, several of Buffett's associates did not fare as well. Neither did Greg Reyes.

And who knows about those Lehman Brothers executives -- they may be winners, after all? I mean, everyone was doing it, right? But you never know for sure.

Finally, who possibly can justify what Bill Furst has been through?

Just as with a gambling lottery, there is no rhyme or reason as to who wins or loses in the criminalization-of-business lottery. But in this lottery -- which does little or nothing to deter the true business criminals of the world -- the losers and their families give up much more than merely money.

A truly civil society would find a better way.

Posted by Tom at 12:01 AM | Comments (1) |

May 2, 2010

An historically bad team of Stros hitters

It�s not a surprise that the Stros (8-15; five straight losses) are bad this season. But this is looking to be one of the worst hitting teams in the history of the Stros� franchise.

As regular readers of this blog know, the RCAA ("runs created against average") and RSAA ("runs saved against average") statistics, developed by Lee Sinins for his Sabermetric Baseball Encyclopedia, provide a simple but revealing benchmark of how an MLB player or club is performing during the long MLB season.

RCAA reflects how many more (or fewer) runs that a player (or team) generates relative to a league-average player (or team). An exactly league-average player's (or team�s) RCAA is zero.

Similarly, RSAA measures how many more (or fewer) runs that a pitcher (or pitching staff) saves relative to a league-average pitcher (or pitching staff). As with RCAA, an exactly league-average pitcher�s (or team�s) RSAA is zero.

After a rough start to the season, the Stros� pitching staff has come around to a 3 RSAA (through Friday�s game), which means it�s a slightly above-average NL pitching staff.

But the hitters? Well, that�s another story.

Through 23 games (a bit over 14% of the season), the Stros hitters have created an astounding 42 fewer runs than an average NL club of hitters would have created using the same number of outs. That�s by far the worst in Major League Baseball (the Orioles are the next worst at �26) and � with still over 80% of the season to go � already the 10th worst performance in Stros franchise history:

1    Colt 45�s                1964     -138  
2    Colt 45�s                1963     -107  
3    Colt 45�s                1962     -101  
4    Astros                   1989      -64  
5    Astros                   1982      -63  
6    Astros                   1968      -51  
7    Astros                   1990      -49  
8    Astros                   2006      -47  
9    Astros                   2008      -46  
10   Astros                   2010      -42

11   Astros                   1991      -39   
12   Astros                   2009      -34  
13   Astros                   2005      -26  
14   Astros                   1971      -16  
15   Astros                   1979      -13

To make matters worse, the Stros hitters do not appear poised to improve over the balance of the season. The club�s best hitter � 1B Lance Berkman � is gimpy with a balky knee and other assorted injuries. The club�s only other consistently good hitter � LF Carlos Lee � has fallen off a cliff to the point where he is one of the worst hitting regular NL players (-11 RCAA).

In fact, the only regular Stros player with a positive RCAA is CF Michael Bourn and he is barely above-average (3 RCAA). With the exception of RF Hunter Pence, there is not another regular Stros player who appears capable of generating a positive RCAA over the rest of the season.

Similarly, there is no player in the upper levels of the Stros� farm system who appears capable of generating a positive RCAA for the big-league club.

Thus, it appears almost certain that this will be the worst hitting Stros team in club history. Even the club-record worst performances of the three Colt 45 teams from 1962-64 are within reach of this season�s team.

And if the pitching staff falls apart in the second-half of the season as it did last year, this season could get really ugly.

Posted by Tom at 12:01 AM | Comments (0) |

April 30, 2010

The CIT lesson

Remember C.I.T. Group?

That was the company that Treasury Secretary Timothy Geithner orchestrated a $2.3 billion bailout for without requiring debtor-in-possession financing protection. Of course, after that federal bailout, CIT promptly filed for reorganization under chapter 11.

Well, as this WSJ editorial explains, there is a reasonably happy ending to the CIT saga -- �Not only did CIT's filing not cause the end of the world for its counterparties or customers, but the company quickly emerged from bankruptcy and has embarked on an aggressive turnaround.�

Allocating risk of loss properly is really not rocket science.

Posted by Tom at 8:02 PM | Comments (1) |

Cleese on how to irritate people

You think the TSA is irritating? John Cleese provides a lesson on how to really irritate people.

Posted by Tom at 12:01 AM | Comments (0) |

April 29, 2010

Why do we do this to ourselves?

As we ponder how one governmental agency -- which couldn't uncover Bernie Madoff or Stanford Financial's sketchy affairs despite being told about them -- is going to make a fraud case against Goldman Sachs on a transaction between sophisticated investors who knew what was going on, let's check out another government agency's bumbling decision-making:

More than thirty organizations across the political spectrum have filed a formal petition with the Department of Homeland Security, urging the federal agency to suspend the airport body scanner program.

Leading security expert Bruce Schneier stated, "Body scanners are one more example of security theater.

Last year, the organizations asked Secretary Janet Napolitano to give the public an opportunity to comment on the proposal to expand the body scanner program. Secretary Napolitano rejected the request. Since that time, evidence has emerged that the privacy safeguards do not work and that the devices are not very effective.

"At this point, there is no question that the body scanner program should be shut down. This is the worst type of government boondoggle -- expensive, ineffective, and offensive to Constitutional rights and deeply held religious beliefs," said Marc Rotenberg, President of EPIC.

And if Bruce Schneier's opinion isn't good enough for you, take heed of what a leading security expert who is constantly on the front lines says about the scanners:

A leading Israeli airport security expert says the Canadian government has wasted millions of dollars to install "useless" imaging machines at airports across the country.

"I don't know why everybody is running to buy these expensive and useless machines. I can overcome the body scanners with enough explosives to bring down a Boeing 747," Rafi Sela told parliamentarians probing the state of aviation safety in Canada.

"That's why we haven't put them in our airport," Sela said, referring to Tel Aviv's Ben Gurion International Airport, which has some of the toughest security in the world.

Sela, former chief security officer of the Israel Airport Authority and a 30-year veteran in airport security and defence technology, helped design the security at Ben Gurion.

Despite what the experts say, he wasteful airport security process that we have allowed the Transportation Security Administration to impose on us continues unabated at a substantial direct cost and an even greater indirect one.

It's bad enough that the TSA's procedures do virtually nothing to discourage serious terrorist threats. What's worse is that the inspection process is really just "security theater" that makes only a few naive travelers feel safer about airline travel.

And if all that weren't bad enough, the worst news is that once a governmental "safeguard" such as the TSA procedures are adopted, Congress has no interest in dismantling it even when it's clear that process is ineffective, expensive and obtrusive to citizens. Stated simply, the TSA has become a jobs program for thousands of registered voters.

James Fallows sums up the absurdity of the situation well:

TSA + defense contractor + security theater vs Israeli expert + Schneier + common sense.

Hmmm, I don't know what to believe.

Posted by Tom at 12:01 AM | Comments (4) |

April 28, 2010

Time for a quick trip around the art museum

Posted by Tom at 12:01 AM | Comments (0) |

April 27, 2010

The Chronicle and the NFL Draft go in opposite directions

Although I continue not to understand the attraction, the National Football League's annual draft of players over this past weekend garnered record television ratings.

Meanwhile, Kevin Whited notes that the Houston Chronicle continues to bleed badly in terms of circulation. The local daily posted a staggering 13.77% decline in daily circulation, and a 9.76% decline in Sunday circulation in the latest numbers.

Frankly, the Chronicle's coverage of the NFL draft is a good case study on why it is losing readers rapidly.

Despite the growing popularity of the draft, the Chronicle's main sportswriters -- John McClain and Richard Justice -- serve up cheerleading glop about the Texans' draft each year even though the local club has been arguably the least successful expansion franchise in NFL history. But for Chron bloggers such as Steph Stradley and Lance Zierlein, there really wouldn't be anything of substance about the draft to read in the Chronicle. Heck, this breathless Justice column from the other day piece is practically the same as his equally fatuous article about the Texans' 2007 draft at the time.

As the always-insightful Alan Burge points out, it is silly to evaluate an NFL team's draft until at least three seasons later because of the nebulous nature of selecting prospects who will turn out to be productive NFL players. And as I noted at the time -- the Texans' 2007 draft was not as impressive as Justice's flowery evaluation at the time. While Burge is charitable in giving the Texans' effort a C-minus grade, Justice has yet to realize that his glowing report of Texans management's performance in the 2007 draft was flat wrong.

Thus, while the Chron continues to run the mailed-in work on popular events, bloggers such as Burge are filling the void with substantive analysis. Consumers eventually notice and gravitate toward the substance and away from the blather.

I wonder whether Chronicle management will notice before it's too late?

Posted by Tom at 12:01 AM | Comments (0) |

April 26, 2010

A real bad mix

Regular readers of this blog know about the human carnage that results from abuse of the government�s prosecutorial power.

Also, the immense damage that overly-broad application of child predator laws is inflicting on many citizens has been a frequent topic on this blog.

But, as Bill Anderson has been chronicling over the past month in regard to the Tonya Craft case, when both of these dynamics are involved in a particular case, the results are so troubling that they seem surreal.

We like to think that we have evolved to a point at which witch hunts are no longer possible. But the truth is that we are still quite capable of mounting them.

As Ayn Rand observed about those who abuse state power to further their supposedly altruistic goals:

"[T]he truth about their souls is worse than the obscene excuse you have allowed them, the excuse that the end justifies the means and that the horrors they practice are means to nobler ends."

"The truth is that those horrors are their ends."

Posted by Tom at 12:01 AM | Comments (0) |

April 25, 2010

Top Ten Goldman Sachs Excuses

Posted by Tom at 12:01 AM | Comments (1) |

April 24, 2010

Touring the world in 80 seconds

Posted by Tom at 12:01 AM | Comments (0) |

April 23, 2010

How about an NFL auction?

The most mind-numbing time of the year from a professional sports perspective is clearly the NFL pre-season, but a close second is the NFL Draft, even though some of the reactions that it generates are rather humorous.

But as this Reed Albertotti/WSJ article points out, all this fuss is being made about something that is really obsolescent:

The draft was once an innovative solution for distributing college talent to pro teams, but that was 75 years ago. The economics of pro football have gradually made it less effective, and as the college game becomes increasingly different from the NFL, players have become even more difficult to scout.

What's surprising is that the NFL, a league with a long history of making sweeping rules changes, hasn't much changed its draft format since the draft was first held in 1936. Since then, an entire academic-research area known as "market design," a spinoff of the Nobel Prize-winning concept of game theory, has grown exponentially to serve just this purpose�helping markets operate more efficiently by creating better rules and procedures to govern them.

And the best alternative would actually make the draft much more fun to watch � an old-fashioned auction of players:

Three researchers at Harvard Business School�who studied under Alvin Roth, a Harvard professor and a pioneer in market-design theory�have proposed an alternative to the NFL draft.

Under their plan, all 32 teams would be given seven picks. They would have to abide by a spending cap that would go higher to lower�with the worst team (based on its record the previous season) having the most money to spend. When the bidding opened, the most sought-after players would draw multiple bids. Teams could then raise their bid as high as they'd like for a player they coveted.

Theoretically, a team could get any player it wanted�so long as it was prepared to pinch pennies on everyone else. Meanwhile, a team that didn't want to break the bank on any particular player could pick up lots of useful parts by spreading its money around evenly. Teams could also thrive by focusing on the bidding and looking for bargains.

Management of NFL teams would probably resist an auction because it would complicate the development of their drafting strategy. But it�s not as if most teams do all that well drafting players under the current system. And it would sure make it more entertaining for the fans.

Posted by Tom at 12:01 AM | Comments (0) |

April 22, 2010

It wasn’t Lidge’s fault after all

I always thought that it was Brad Lidge�s fault that Albert Pujols in Game Six of the 2005 NLCS caused Houstonians to endure memories of these sporting disasters again.

But now, former Stros 3B Morgan Ensberg reveals that it was all really the fault of an optical illusion at Minute Maid Park (H/T John Royal).

Who knew?

By the way, check out the 2005 list of the Stros top ten prospects.

No wonder the local club is struggling.

Posted by Tom at 12:01 AM | Comments (1) |

April 21, 2010

Representing society’s new lepers

The increasingly draconian application of child predator and pornography laws has been a frequent topic on this blog.

Norm Pattis does a good job of summarizing the ominous information that defense counsel should provide to defendants and their families face when ensnared in such a prosecution. The bottom line is that the prosecution itself and the usual resulting prison sentence is only the beginning of the defendant�s troubles. The aftermath is often even worse.

No one objects to putting away true child predators. But when the tough criminal laws that are used to imprison the child predators are turned against young people who made a mistake in an underage relationship or in viewing pornography, the stark penalties cause needless damage to lives, careers and families.

Organizations such as Texas Voices are informing the public of this tragic waste and the need for reform. It is a worthy cause for a constituency that has no political leverage. Consider lending them your support. 

Posted by Tom at 12:01 AM | Comments (1) |

April 20, 2010

Houston Metro in a few years

Houston�s Metropolitan Transit Authority has been on the receiving end of well-deserved criticism lately regarding its dubious finances (see here, here and here).

But it�s always nice to realize that things could be worse. For example, we could be dealing with the San Francisco Bay Area�s Metropolitan Transportation Commission, which actually is one of the models that Metro has used in establishing its absurdly inefficient light rail system. Check this out:

The 2009 annual report from the Metropolitan Transportation Commission (MTC) is a bombshell, a wake up call, a Klaxon - choose whatever metaphor you like - if you care about public transit in the Bay Area, this report is probably going to affect your life.

It shows, more clearly than any of the reports of budget woes coming from the individual transit agencies, that the entire system is unsustainable.

Think the fare hikes and service cuts are bad now? Just wait. The MTC added up the projected budgets of the agencies and found that operating costs would exceed revenues by $8 billion over the next 25 years (emphasis supplied), while planned improvements (like new buses, and the Warm Springs BART station) will require someone to dig up an additional $17 billion in spare change from under the couch.

And that�s not even the worst of it:

In the last decade [Bay Area residents] almost doubled the amount of money [they] put toward transit, while increasing service only 16 percent and ridership only 7 percent.

Meanwhile, Houston Metro is currently proposing to sell $866 in general obligation bonds, yet it does not have non-tax revenue that is even close to covering debt service on that level of debt. Metro has not even floated what credit enhancement it proposes to provide in order to sell those bonds.

Hopefully, Houston�s leaders will nip this type of lunacy in the bud. If they need any incentive, then the Bay Area MTC is a useful reminder of the even bigger mess that Metro could be.

Posted by Tom at 12:01 AM | Comments (0) |

April 19, 2010

Goldman in the crosshairs

The inevitable SEC action against Goldman Sachs took the financial system by storm on Friday, so the weekend has been a feast of blogosphere analysis on the implications of the lawsuit. The best way to follow daily developments in the case is over at Clusterstock where Joe Weisenthal and Henry Blodget have their fingers on the blogosphere�s pulse in regard to the SEC lawsuit.

The best analysis of the lawsuit that I�ve read in the blogosphere to date comes from Larry Ribstein, Erik Gerding and UH�s Craig Pirrong. Read their posts and you will have a good understanding of the issues involved in the case.

Frankly, the SEC action against Goldman looks a lot more about public relations than effective regulation. As Blodget pointed out on Friday morning, the timing of the filing pushed the highly embarrassing SEC Inspector�s report on the SEC�s bungling of the investigation into Stanford Financial off the public�s radar screen. One would hope that the SEC�s due diligence in regard to its action against Goldman is better than its research into Stanford Financial, which was widely known in Houston financial and legal circles to be a sketchy outfit for over a decade before it blew up last year.

The key to the SEC's case is that Goldman apparently did not disclose to ACA nor IKB and ABN knew that uber-mortgage short specialist John Paulson was placing bets against the underlying securities upon which the synthetic CDO was based at the same time as Paulson was helping Goldman and ACA choose the underlying securities.

Thus, the theory goes, Paulson presumably had an incentive to enhance the failure of the securities. Accordingly, the SEC contends that Goldman and Paulson structured the deal to lose, that Goldman knew the investors wouldn't buy if they knew that, and that Goldman didn't disclose those details because it was making fees all over the place.

My sense is that the case is far from a slam dunk (see also here and here) for the SEC, but it probably doesn't make any difference. If Goldman defends itself and loses, then the trial penalty is that private civil lawsuits by other investors will use the judgment in favor of the SEC to establish liability against Goldman (interestingly, Goldman elected not to disclose its receipt of the Wells Notices related to the SEC lawsuit). Although Goldman could manage the payment of an SEC fine, damages in those civil lawsuits could seriously harm the firm.

Thus, my sense is that Goldman has to settle with the SEC, and probably for a good chunk of change to make the SEC look good. That will likely suit Goldman just fine because it would continue to distract the public from the far larger travesty, which was the way in which the federal government bailed Goldman out from its massive risk of loss in regard to AIG.

From a policy standpoint, the SEC action is a part of the Obama Administration's public relations campaign to promote federal regulation of the derivatives markets, a point that Professor Ribstein makes in this post:

In other words, the SEC, under pressure to come up with something on the eve of Congress's final push toward financial regulation comes with a case that the complaint makes clear is much more about the creation of systemic risk than about securities fraud.

This reflects, in part, the new Wall Street, more than three quarters of a century after the securities laws were enacted. Financial regulation is now much more about sophisticated market intermediaries than about individual investors who need somebody to ensure they have the truth about securities.

This is not to say that securities fraud is irrelevant. However, the SEC has struggled on that front � the Bank of America settlement, Madoff, Stanford.

And so now we are left with . . . Goldman.

Inasmuch as such regulation will allow federal regulators to exercise the same judgment in regard to derivatives regulation that it applied to regulating the likes of Stanford Financial and Bernie Madoff, count me as decidedly unconvinced that this development constitutes progress.

However, one positive aspect about the SEC�s complaint is that it provides a stark reminder to investors of the risk of doing business with the likes of Goldman. As Arnold Kling has been saying for years, perhaps it wouldn�t be such a bad thing if investors didn�t rely so much on the chauffered investment bankers of Wall Street and their friends in government.

Posted by Tom at 12:01 AM | Comments (1) |

April 18, 2010

Our troubling tax system

Another first rate Cato Institute video on the horrific cost of our overly complicated taxation system.

Posted by Tom at 12:01 AM | Comments (0) |

April 17, 2010

Rickles roasts Governor Reagan

When Don Rickles got on a roll, he was very, very funny.

Posted by Tom at 12:01 AM | Comments (0) |

April 16, 2010

That health care overhead

Following on this post from earlier in the week on the adverse impact that the third party payer system of health care finance has had on controlling health care costs, check out this Catherine Rampell post that passes along the graph on the left and the following startling observation:

�For every doctor, there are five people performing health care administrative support.�

And we are about to implement changes in the health care finance system that increases the third party payer element that requires much of this administrative support? While dramatically increasing the number of people covered under such a third party payment scheme with no provision for increased supply of medical services to meet that additonal demand?

What possibly could go wrong?

Posted by Tom at 12:01 AM | Comments (1) |

April 15, 2010

Milton Friedman on poverty

Posted by Tom at 12:01 AM | Comments (3) |

April 14, 2010

How we pay for health care

What is the most efficient way to pay for health care?

Proponents of a single-payer governmental system content that patients should not have to pay the cost of their health care decisions and that the government can effectively control costs through top-down mandates.

On the other hand, opponents of such a system maintain that the most effective way to curb costs is to have patients bear a portion of their health care costs -- such as routine expenses -- and that the government can�t efficiently control costs without rationing care.

In a recent JAMA op-ed, Dr. John Ford provided this graph (H/T Jeff Miron) to reflect the increase in third-party payment of health care expenses over the past half-century and the decrease in patient payment of expenses over the same span. Health care costs have skyrocketed over the same period.

Why should anyone believe that reform that continues the trend toward more third party payment of health care expenditures is going to result in meaningful reduction of health care costs?

Posted by Tom at 12:01 AM | Comments (4) |

April 13, 2010

Two best videos from The Masters

It takes awhile, but Adam Scott gets an eagle:

Good thing that Phil Mickelson won and didn�t have to endure losing by a stroke. He might have never recovered from this:

Posted by Tom at 12:01 AM | Comments (0) |

April 12, 2010

The Death of American Virtue

I just finished Ken Gormley�s The Death of American Virtue: Clinton v. Starr (Crown 2010) and recommend it highly to anyone who is interested in a thorough examination of the dynamics and circumstances that lead to the abuse of the government�s enormous prosecutorial power.

What started out as an investigation into Bill and Hillary Clinton�s small investment in a failed real estate deal (Whitewater) turned into a tsunami of litigation that practically paralyzed the executive and legislative branches of the federal government for months. Essentially, when the attorneys involved in the investigation couldn�t pin anything of substance on the Clintons in regard to Whitewater, they jumped at the opportunity to set President Clinton up to lie in a civil deposition and before a grand jury in regard to his relationship with former White House intern, Monica Lewinsky.

Although few of the attorneys involved in either side of this battle come out looking good, this scrupulously even-handed book places most of the blame at the hands of Ken Starr and his Office of Independent Council prosecutorial team. The fact that Starr and his team thought they could get away with intimidating Lewinsky in a hotel room for over 12 hours without allowing her to contact her counsel speaks volumes of how out of touch they were with the pursuit of justice, not to mention legal ethics. That type of reasoning is why, on balance, Starr and his prosecutorial team come out looking worse than President Clinton and his defenders despite the fact that Clinton lied about his relationship with Lewinsky under oath on two occasions.

One of the most interesting of the dozens of fascinating anecdotes in the book involves Starr�s dubious decision to de-emphasize the Whitewater investigation in favor of the Clinton-Lewinsky investigation. Hickman Ewing, who was Starr�s deputy running the Whitewater investigation in Little Rock at the time the Lewinsky investigation exploded in Washington, had concluded that Hillary Clinton had committed crimes in regard to her involvement in Whitewater. I�m not as sure as Ewing that she did commit any crime � most of what Hillary did appeared to me to be the actions of a lawyer who was simply over her head in dealing with a faltering real estate development and a failing S&L.

At any rate, "[i]n Ewing's eyes, Mrs. Clinton had lied to the [Office of Independent Council], had lied to the grand jury, and would keep lying until the cows came home if she was not brought to justice," writes Gormley. Ewing went so far as to draft an indictment of Hillary for conspiracy to conceal her true relationship with the Madison Guaranty S&L in order to �avoid and evade political, criminal and civil liability, fraudulently secure additional income for the Rose Law Firm and safeguard the political campaigns of William Jefferson Clinton.� But because the focus of the investigation had turned toward President Clinton�s relationship with Lewinsky, Starr and the other prosecutors outvoted Ewing and elected not to dilute their investigation with a prosecution of Hillary.

Thus, with more than a touch of irony, Ewing observed, "Monica saved Hillary."

Posted by Tom at 12:01 AM | Comments (0) |

April 11, 2010

The Pope and the NY Times

It all seems so clear, doesn�t it?

As this Laurie Goodstein/Michael Luo/NY Times article presents, Pope Benedict XVI and a chronically corrupt Roman Catholic Church have been complicit in the protection of child-abusing priests.

But as this William McGurn/WSJ op-ed notes, the Times� reporters undisclosed feeding of information from plaintiff�s lawyers who have made a cottage industry out of suing the Catholic Church raises as many questions as the ones the Times raises about the church�s handling of the sex-abuse cases. As McGurn notes:

The man who is now pope reopened cases that had been closed; did more than anyone to process cases and hold abusers accountable; and became the first pope to meet with victims. Isn't the more reasonable interpretation of all these events that Cardinal Ratzinger's experience with cases like Murphy's helped lead him to promote reforms that gave the church more effective tools for handling priestly abuse?

Yeah, but reporting that would not sell as many newspapers. And also not comply with the objectives of undisclosed agendas.

Morality plays are comforting because they make it easy to identify and demonize the villains. The truth is usually more nuanced and complicated, but ultimately more fulfilling to understand and less likely to generate witch hunts.

Update: Father Raymond J. De Souza provides more insight into the Kiesle case.

Posted by Tom at 12:01 AM | Comments (5) |

April 10, 2010

Shawshank Tiger

What was Nike thinking?

Posted by Tom at 12:01 AM | Comments (6) |

April 9, 2010

Another absurd cost of security theater

How much wasteful spending on security theater is enough?

Bruce Schneier links to U.S. Representative John Duncan�s Congressional observation about the Federal Air Marshals Service:

Actually, there have been many more arrests of Federal air marshals than that story reported, quite a few for felony offenses. In fact, more air marshals have been arrested than the number of people arrested by air marshals.

We now have approximately 4,000 in the Federal Air Marshals Service, yet they have made an average of just 4.2 arrests a year since 2001. This comes out to an average of about one arrest a year per 1,000 employees.

Now, let me make that clear. Their thousands of employees are not making one arrest per year each. They are averaging slightly over four arrests each year by the entire agency.

In other words, we are spending approximately $200 million per arrest.

Let me repeat that: we are spending approximately $200 million per arrest.

One could quibble that spending per arrest is not an entirely fair measure of effectiveness. A good deterrent effect means fewer arrests, right?

Nevertheless, it�s a pretty good indication of misdirected resources if a law enforcement agency�s officers are more likely to be arrested than to make arrests.

Posted by Tom at 12:01 AM | Comments (2) |

April 8, 2010

Good bye and good riddance

Do New York Times reporters even bother to research the subject of their articles at all?

Take this A.G Sulzberger/NY Times puff piece on the departure of current U.S. Attorney for the Southern District of New York, Benton J. Campbell.

You may remember Campbell. He was the lead prosecutor on the Enron-related criminal trial known in these parts as the first Enron Broadband trial, which ended in an embarrassing loss for Enron Task Force after the prosecution was caught threatening defense witnesses (see also here) and propounding false testimony from one of its key witnesses. Sort of what you would expect from a trial in which the Task Force advocated an unwarranted expansion of a criminal law intended to punish kickbacks and bribes against business executives who didn�t take any.

Then, as if that wasn�t enough, Campbell proceeded to lead the prosecution (unsuccessfully, thank goodness) that attempted to make refusing to throw in the towel a crime. Given that he decided to become a prosecutor while watching Rudolph W. Guiliani, who could be surprised by such appalling lack of judgment?

Sort of makes one wonder just how much unwarranted destruction of lives one has to be involved in before the Times notices?

Posted by Tom at 12:01 AM | Comments (1) |

April 7, 2010

How will Obamacare ration care?

During the latter stages of the debate over reform of the American health finance system, one of the key issues that seemed to fade amidst the rhetoric was the question of how the revamped health finance system will ration care (see also here). Inasmuch as it is still not clear to me how care will be rationed under Obamacare, this recent Happy Hospitalist post caught my eye:

I'm down in the ER the other day when I see a chief complaint fly by on the radar.  What is that chief complaint you ask? �Refused by Detox.�

The patient was so drunk, even the community detox center refused them.  So how did this play out?  The patient was taken by ambulance from his home to a small town community ER for altered mental status.  There, he was  booked into the ER and seen by a small town community ER physician family practice resident or PA or NP.  Diagnosis you ask? �Acute alcohol intoxication. Plan:  Discharge to community detox center.�

The patient was then transported to detox  by a cop where he was promptly refused by detox for being too drunk. Too drunk for detox.  How sad is that.  At this point another ambulance was called and the small town hospital refused to accept him back because he was "too drunk" for them to handle if he became comatose and critically ill.

So the ambulance drove him 75 miles to Happy's hospital which has to accept him, where he was promptly booked into the emergency department in front of the 28 year old with heart burn, the 19 year old looking to get a pregnancy test and the 14 year old who's mother brought her in because she just had her first period.  What happened with our drunk?  He was promptly placed in a room where stat lab confirmed what everyone else had suspected.  He was drunk.  The big city ER doctor billing $500 an hour proudly made his diagnosis and disposition plans known to the world: �Acute alcohol intoxication. Plan: Discharge to community detox.�

By now, the patient's alcohol level was down to 320 and he was awake, responsive and asking for a samich as the cops show up to take him away. Let's conservatively add it up:

• Two ambulance rides $1,000
• Two ER visits $3,000
• Two ER physician visits $500

Almost $5,000 to take care of a drunk in which doing nothing would have given you the same result.  And you wonder why Medicaid is going bankrupt.

The Hospitalist goes on to point out how expenses such as the foregoing is eventually going to lead to failure of many inner-city hospitalists. But an equally troubling issue is whether anything will change in regard to future opportunities for misallocation of expenses under an increasingly subsidized health care system?

Frankly, I doubt it.

Posted by Tom at 12:01 AM | Comments (4) |

April 6, 2010

The NFL’s big risk

This post from awhile back noted the high risks that NFL football players take relative to their compensation.

Well, it looks as if that risk may be coming home to roost:

California�s workers� compensation system provides a unique, and relatively unknown, haven for retired professional athletes among the 50 states, allowing hundreds of long-retired veterans each year to file claims for injuries sustained decades before. Players need not have played for California teams or be residents of the state; they had to participate in just one game in the state to be eligible to receive lifetime medical care for their injuries from the teams and their insurance carriers.

About 700 former N.F.L. players are pursuing cases in California, according to state records, with most of them in line to receive routine lump-sum settlements of about $100,000 to $200,000. This virtual assembly line has until now focused on orthopedic injuries, with torn shoulders and ravaged knees obvious casualties of the players� former workplace.

Given the dozens and perhaps hundreds of players who could file similar claims, experts in the California system said N.F.L. teams and their insurers could be facing liability of $100 million or more. They identified a wide spectrum of possible effects: these costs could merely represent a financial nuisance for a league that recorded $8.5 billion in revenue last year, or, if insurance costs rise drastically because of such claims, the N.F.L. could be forced to alter its rules to reduce head trauma. Officials already are considering decreased contact in practice and forbidding linemen from using the three-point stance.

Perhaps the NFL�s undervaluing of this risk is a product of a false sense of security that the NFL owners have nurtured from a collective bargaining process that has shielded the league from most anti-trust liabilities over the years. But the NFL owners better pay attention to this development. Plaintiffs� lawyers will have a field day against that group.

Posted by Tom at 12:01 AM | Comments (1) |

April 5, 2010

Batter up! Stros 2010 Season Preview

With the opening of Major League Baseball�s season, this is the seventh (!) HCT preview  (previous ones here) of the Stros� upcoming season. But with the continued development of the blogosphere over the past seven years, it�s time to change the way in which HCT covers the Stros and MLB.

The reason for the change is simple. When this blog started in early 2004, coverage of the Stros was limited pretty much to the local mainstream media�s coverage, which has been mostly bad. However, over the past 6+ years, the blogosphere has exploded and now a large number of bloggers and Twitterers cover the Stros on a daily basis better than either the mainstream media or this blog:

Astros County/http://twitter.com/Astroscounty

Crawfish Boxes/http://twitter.com/crawfishboxes

Zac Levine�s Unofficial Scorer/http://twitter.com/thescorer

Alyson�s Footnotes/https://twitter.com/alysonfooter

Tag�s Lines

Kiss My Astros

AstrosDaily.com

A Misplaced Astros Fan (quite good, but not updated recently)

Also, the following sites come in handy while following the Stros and MLB:

Stats MLB site

Coolstandings.com site (continually updated playoff odds)

Baseball Reference.com

Stros Sortable Stats

Stros Active Roster

Stros 40-man Roster

With all this coverage, I�m no longer going to cover the Stros in the depth or regularity that I have in previous seasons. I will continue to post occasional observations about the Stros and baseball, particularly when the mainstream media passes along myths and misconceptions. But check out the resources above for really good and comprehensive coverage of the Stros.

With regard to the Stros, not much has changed since last year�s dismal 74-88 season. That club failed to make the playoffs for the fourth straight season since the Stros 2005 World Series appearance. This season's club is arguably weaker than last season's club, so it would appear that playoff contention remains a pipe dream.

As I�ve been saying for years now, the Stros have been a team in decline for a long time even though generally superior pitching during the 2002-2006 seasons masked that downturn. Owner Drayton McLane cleaned house toward the end of the disastrous 72-90 2007 season and the club is now firmly in the process of rebuilding its farm system, which had deteriorated into one of MLB's worst over the latter stages of the Biggio-Bagwell era. 

Last season, the Stros were muddling around with a .500 record based on slightly above-average hitting and slightly below-average pitching as of All-Star break when the pitching staff fell apart during third quarter, saving an astounding 43 fewer runs during that 40-game stretch than a National League-average pitching staff would have saved over those games. The pitching continued to go south during the final quarter of the season while the hitting fell apart completely down the stretch, which left the Stros with a 74-88 record, a �77 RSAA and a �34 RCAA. 

Frankly, this performance level was easily predictable given what Baseball Prospectus has dubbed the "stars-and-scrubs" Stros roster. The Stros continue to play out a weak hand of a few above-average stars and below-average balance of the roster while attempting to deal with the long-overdue rebuilding program that has became necessary -- but was generally ignored -- during the final years of the Biggio-Bagwell era. GM Ed Wade and Scouting Director Bobby Heck have completed their third straight strong draft in terms of numbers, so the rebuilding program is in full swing. But it's going to take another year or two before any appreciable amount of that investment begins to payoff at the MLB level.

This season, expect the Stros� pitching staff to improve somewhat (could it really get worse than last season�s?), although it�s not a good sign that Roy Oswalt (-1 RSAA/4.12 ERA/8-6 W-L) has already had to have a cortisone shot to treat a deteriorating disc condition that contributed to his worst MLB season last year. Moreover, it�s quite probable that the hitting will be worse this season given that the Stros best hitter � 1B Lance Berkman � is coming off his least productive MLB season (31 RCAA/.399 OBA/.509 SLG/.907 OPS/25 HR/80 RBI in 136 games) since his 2000 rookie season and will start the season on the disabled list for a few games with a balky knee.

Thankfully, the rest of the National League Central is not overwhelming. The Cardinals and the Cubs appear to be the class of the division and my sense is that the Reds are the most likely club to make a jump up the standings this season. It appears that the Stros will be fighting it out to avoid the cellar with the Brewers and the Pirates. As a result, an over/under of 73 wins for the Stros seems about right.

Nevertheless, despite the Stros� woes, I continue to enjoy watching Major League Baseball. This will be the 25th straight season that I�ve had season tickets to the Stros games. I�ve seen some really good teams during that span and some really bad ones, too. But my curiosity about the game has never wavered. It won�t this season, either.

Play ball!

Posted by Tom at 12:01 AM | Comments (1) |

April 4, 2010

Underwater astonishments

David Gallo�s remarkable footage during his 2008 TED lecture.

Posted by Tom at 12:01 AM | Comments (0) |

April 3, 2010

Could this persuade the Aggies to consider female cheerleaders?

The yell leaders could have some fun with this.

Update: Turns out that A&M does have female cheerleaders, albeit "competitive cheer" only. The squad is called the Texas A&M Competition Squad (http://competitionsquad.tamu.edu/).

Posted by Tom at 12:01 AM | Comments (0) |

April 2, 2010

Austin’s Carpie

Posted by Tom at 12:01 AM | Comments (0) |

April 1, 2010

De Vany on PED’s, Diet and Exercise

When you have a free hour, don�t miss Russ Roberts� fascinating EconTalk interview of Clear Thinkers favorite Art De Vany.

Performance enhancing drugs resulted in new records in baseball? Pure conjecture. More likely the records are simply the result of outliers.

The more exercise, the better? Nope. Intensity and randomness is the key to an effective exercise regimen. Forget the jogging.

We�re healthier than our ancestors? Not really, unless you�re watching your diet and controlling your insulin levels.

Provocative stuff.

Posted by Tom at 12:01 AM | Comments (0) |

March 31, 2010

The genius of Southwest Airlines

Southwest Airlines has been a favorite of this blog over the years because of the company�s intelligent approach to business, often while running counter to the prevailing airline industry �wisdom.�

Thus, as other airlines discourage customers from checking baggage by charging baggage fees, Southwest encourages customers to check baggage by not charging any such fees. The reason? Because, as Eric Joiner explains, it helps Southwest make money:

Southwest Airlines flies a network within the United States that uses basically one airplane. The Boeing 737. For this reason, baggage capacity is fairly consistent with passenger load. Also anyone making a connection is likely to make a connection to another SWA 737, so baggage load factor remains fairly consistent across the network. This has major advantages.

By inspiring customers to check bags, aircraft can be loaded and unloaded much faster than if passengers carry bags onto the main deck and put them in the overhead bin. Anyone who has been on a fully loaded jet recently knows it can take 15-20 minutes just to get the passengers off the plane. The bigger the jet, the longer this takes. Time spent on the ground means time not in the air. Airlines only make money when the jet is flying. By encouraging passengers to check bags and by operating a homogeneous network, SWA can turn flights faster and thus create more profit for the airline.  

What you are actually witnessing is an extension of Southwest�s fuel strategy. SWA has always done a brilliant job of fuel cost hedging.  That is buying futures in jet fuel against probable market cost at time of consumption.  Turning aircraft faster means more revenue for the fuel already purchased. Consider this a post hedge leverage on the gas in the tank.

Isn�t it interesting that Congress periodically attempts to stifle precisely this type of innovative wealth and job creation?

Posted by Tom at 12:01 AM | Comments (3) |

March 30, 2010

The criminalization-of-business lottery continues

So, after having been tried and convicted once in 2007, and having that conviction subsequently overturned because of prosecutorial misconduct, former Brocade Communications CEO executive Greg Reyes was convicted again last week on nine counts of securities fraud and making false statements in connection with his involvement in backdating stock options.

Alas, the criminalization-of-business lottery continues in regard to another business practice that simply should not be a crime. Frankly, Reyes� real crime appears to be that he is not Steve Jobs.

Unfortunately, the publicity surrounding this recent disclosure � which took place during Reyes� trial � probably didn�t help Reyes much.

It probably won�t help Robert Furst, either, who is the next unlucky executive who will be put on the merry-go-round of an utterly baseless and random prosecution.

Meanwhile, the different trajectories of these two lives really makes one wonder about the purpose of all this?

Back in 2006, Larry Ribstein was the first blogger to challenge the backdating prosecutions. The utter vacuity of those prosecutions proved that his skepticism was correct. I cannot improve upon Professor Ribstein�s characterization of the true scandal relating to the backdating of stock options:

�The real backdating scandal is not the one that has been generally reported. It is, instead, the woeful inadequacy of mainstream business reporting compounded by prosecutorial misconduct.�

A truly civil society would find a better way.

Posted by Tom at 12:01 AM | Comments (0) |

March 29, 2010

It’s Shell Houston Open week

The PGA Tour makes its annual trek to Texas this week for the Shell Houston Open at the Tournament Course at Redstone Golf Club. It�s always a fun event and well worth attending.

After a rocky divorce from The Woodlands and its popular TPC Course, as well as a difficult transition period in which most of the best PGA Tour players avoided the event, the 2009 tournament attracted the best field in the history of the event. The 2010 tournament has followed that up with an arguably an even stronger field as six of the the top 10 players in the World Rankings are playing. As a result, the field is as good as any of the non-major, non-World Golf Championship events on the Tour.

Phil Mickelson (3), Lee Westwood (4), defending SHO champ Paul Casey (5), Martin Kaymer (8), Ernie Els (9) and Padraig Harrington (10) lead the field, while Rory McIlroy (12), Geoff Ogilvy (14), Luke Donald (20), Hunter Mahan (21), Lucas Glover (25), Charl Schwartzel (26), Anthony Kim (27), PGA champ Y.E. Yang (29), Masters champ Angel Cabrera (32) and Vijay Singh (34) are other well-known Tour members in the field. In addition, local fan favorites such as past SHO winners Fred Couples, Adam Scott and Stuart Appleby are playing.

The first Houston Open was in 1922 and the tournament is tied with the Texas Open as the third oldest non-major championship on the PGA Tour behind only only the Western Open (1899) and the Canadian Open (1904). This is the fifth Houston Open to be played on the Tournament Course and the eighth event overall at Redstone, which hosted its first three Houston Opens on the club's Jacobson-Hardy Course while the Tournament Course was being built.

This is the SHO's fourth year of being played the week before The Masters and the strong field is further confirmation that the tournament�s move to the week-before-The Masters-date was the right one. The Houston Golf Association continues to do a good job of promoting the tournament with Tour players by grooming the Tournament Course in a manner similar to Augusta National. However, the course is actually a flat-land course that bears little resemblance to the hilly venues of Augusta.

Even with its superior conditioning, the Tournament Course is a not a favorite of either players or spectators. Although is has a decent variety of interesting holes, the routing of the course is an unmitigated disaster, with 16 of the holes separated by a long walk and a drainage ditch from the 1st and 18th holes, the driving range and the clubhouse.

Unfortunately, there is not much the Houston Golf Association can do about that routing problem, so let's just hope that the course's superior conditioning and the SHO's attractive tune-up date for The Masters keeps prompting the top players to overlook the routing problem. Here are a few tips on watching the tournament at Redstone.

Although I've had my doubts that the HGA would be able to turnaround the SHO at Redstone, I'm happy to be wrong on that score. Houston has a rich golfing tradition and the HGA is a fine charitable organization. It's going to be another great week at Redstone, so sit back and enjoy the SHO!

Posted by Tom at 12:01 AM | Comments (0) |

March 28, 2010

A stroke of insight

This is one of the most fascinating TED lectures. Brain researcher Jill Bolte Taylor describes the experience of having a stroke.

Update: Interestingly, a number of neuroscientists believe that Bolte Taylor's lecture is misleading. See here and here.

Posted by Tom at 12:01 AM | Comments (0) |

March 27, 2010

Don’t play this guy

Posted by Tom at 12:01 AM | Comments (0) |

March 26, 2010

The epic story of technology

Publisher of the Whole Earth Review and former Wired executive editor Kevin Kelly weaves the fascinating tale.

Posted by Tom at 12:01 AM | Comments (0) |

March 25, 2010

Help for Elk

PGA Tour member and long-time Houstonian Steve Elkington is a Clear Thinkers favorite, so I took notice of this Golf.com article reporting that PGA Tour commissioner Tim Finchem had raised the ire of several Tour pros by helping Elk gain entry into several PGA Tour events this season. Elk had been fully exempt on the PGA Tour for 23 consecutive years until he finished 183rd on the money list last year and lost his exempt status.

Of course, none of the pros complaining about Finchem�s favor to Elk are on this key list voted on by �wide-ranging survey� of golf�s �elite�:

WHO'S THE BEST JOKE-TELLER ON TOUR?

Todd Hamilton: 17%
Steve Elkington: 13%
Harrison Frazar: 8%
Neal Lancaster: 8%
Others receiving votes: Paul Azinger, Rich Beem, Tim Clark, Carlos Franco, Paul Goydos, Peter Jacobsen, Peter Lonard, Nick Price, Chris Riley, Boo Weekley

Given the decidedly unfunny cloud following the PGA Tour around this year, it looks to me as if Finchem has a darn good reason for recommending Elk to tournament sponsors.

Posted by Tom at 12:01 AM | Comments (0) |

March 24, 2010

Longhorns Inc.

More than a few tongues are wagging around Texas Longhorn athletic circles this week over this blistering Texas Observer op-ed on the UT football program authored by UT professor Tom Palaima, who just happens to serve on the UT Faculty Advisory Committee on Budgets and is UT�s representative on the Big 12 steering committee of the Coalition on Intercollegiate Athletics. Here�s a flavor of the article:

The NCAA program at the University of Texas at Austin generated $138 million in revenue last year, $87 million from football. Yet its profit margin is less than $2 million. The program�s cumulative debt and debt service are in the high-risk neighborhood.

Longhorns Inc. has wrapped its tentacles around the now-hemorrhaging academic budget. The athletics department gave a $2 million raise to head football coach Mack Brown as colleges across the university are laying off staff. In foreign languages alone, $1.6 million was cut. The head of the student union recently announced the closure of the Cactus Caf�, a historic music venue, to save just $66,000 over two years.

Worse, the university has ceded trademark and royalty revenues. Longhorns Inc. keeps 90 percent of this income, roughly $10.6 million last year. The yearly debt payment on building bonds for the nearly $300 million in stadium expansions since 1998 is $15 million. The debt run up by the athletics department has risen from $64.4 million in 2004-05 to a staggering $222.5 million in 2008-09.

Unfortunately, Palaima main criticism is how well the UT athletic department and its personnel are doing financially in comparison to the UT academics, whose average salary has increased by �only� 30 percent over the past 20 years or so.

Somehow, however, Palaima utterly misses the most corrupt aspect of big-time intercollegiate athletics. That is, the perverse and discriminatory regulatory scheme that restricts compensation to the players � mostly young black men � whose talent actually generates most of the wealth for the athletic departments.

As I�ve noted many times, big-time college football and basketball is an entertaining form of corruption. Too bad that someone as bright as Professor Palaima fails to understand the true nature of that corruption.

By the way, below is a video of a lively debate between Professor Palaima and longtime UT Law professor Lino Graglia over college football in which Palaima is actually the defender of the entreprise (a colleague asked Palaima �DeLoss Dodds must have given you priority seating at [Darrell K. Royal-Memorial Stadium]�. The transcript of the debate is here.

Posted by Tom at 12:01 AM | Comments (2) |

March 23, 2010

Thoughts on health care finance reform

Inasmuch as America�s fractured health care finance system has been a common topic on this blog since early 2004, many friends and readers have asked my thoughts about the health care reform legislation that was passed yesterday. So here goes.

The legislation is fundamentally flawed because it imprudently foists a top-down reorganization plan on something as complex and disparate as financing health care. But frankly, I have no idea whether it will result in a worse finance system than the current one, which is pretty bad.

My biggest criticism with both the current system and the one contemplated by Obamacare is that the patient is not the customer, at least as it relates to non-catastrophic illness and injury. Without cost control � and customer decision-making is the most efficient one available - neither the current system nor Obamacare will be able to maintain delivery of high-quality care to an increasingly aging population.

However, the reality is that we now have two solid generations of Americans now who enjoy having someone else pay for their health care. So, it�s unrealistic to think that such a societal shift is going to change anytime soon. But it�s still important to understand how we got to this point.

Employer-based health insurance became popular during World War II because it was initially exempted from gross income as a way to circumvent wartime wage and price controls. After the war, marginal income tax rates were high and individual medical expenses were tax deductible, so at least some rational incentives were returned to the medical marketplace.

But all this changed in 1986 when the Reagan Administration made concessions to achieve bipartisan tax reform. Individual medical expenses were no longer deductible until they reached 7.5% of gross income, which virtually eliminated individual incentives in the medical marketplace. Not surprisingly, everyone was incentivized after tax reform to move all medical expenses to third-party-payor health insurance. As a result, individual out-of-pocket expenses in the health care market dropped from 22% in 1985 to less than than 10% of the market now.

So, in essence, the Reagan Administration horse-traded personal tax deductibility of medical expenses away, but figured that was acceptable because at least employer health insurance remained tax-free benefit. I�m sure if we could ask him now, President Reagan would tell you that he expected a future Congress would fix such perverse incentives after the dust settled on the benefits of tax reform. But alas, that never happened.

What happens now? The only certainly is that special interests will be descending upon Washington in droves to do their bidding over the transfers of wealth that will occur under the new legislation. At least it will be entertaining to watch who wins and loses.

But there are two big points that everyone should remember as we embark on this new world of health care finance.

First, the Obama Administration�s rationalization of future cuts in Medicare spending as a funding source for the health care legislation is utterly disingenuous, as Arnold Kling artfully explains:

Imagine that your crazy uncle Fred had bought a dozen cars on credit. As a result, he faces car payments far in excess of what he can afford. He comes to you and says he has a plan that in a couple of years will reduce his car payments by a few thousand dollars. "Now I have the money for a down payment on a boat!" he exclaims, as he runs off to the boat dealer.

The equivalent is for Congress to treat future cuts in Medicare as if they were a newfound source of wealth to be tapped. Once they adopt this precedent, they can increase spending on whatever they want, in unlimited amounts, while claiming deficit neutrality. Future Medicare spending is so high that you can always come up with cuts, as long as they deferred.

Second, as Greg Mankiw notes, projected Medicare cuts in payment rates for physician services portend the rationing of medical services that the promoters of the current legislation contend won�t occur. Because few consumers actually pay for their health care, most folks don�t realize that Medicare and Medicaid payment rates for physician services have already been cut by around 30% since the late 1990�s. That has led many doctors to limit substantially the number of Medicare and Medicaid patients who they are willing to treat in their practices. In my view, that trend is likely to continue under the new legislation. Who will tend to the medical needs of consumers who elect to rely on such insurance in the future?

Supporters of Obamacare generally argue that the legislation offers more equality through expanded insurance and redistribution of benefits. But the wealthy will always find ways to get around the rationing and other restrictions of a government-run health care system. On the other hand, the poor will have no choice but to accept the government health care, which is unlikely to be as high a quality as what the rich folks obtain from their private doctors. Accordingly, although the distribution of health care may be a bit more equal in the short term, I'm not sure that means more equality in health care in the long run.

Which leads me to this question: How long will it be before the federal government requires physicians, as a condition to being allowed to engage in private practice, to accept a certain number of patients under government-sponsored insurance plans that limit payments to the physicians far below what the physicians would otherwise accept?

Posted by Tom at 12:01 AM | Comments (12) |

March 22, 2010

The bad Metro bet

Following on this post from last week, there were a couple of good pieces from over weekend on the cascading boondoggle that is Houston�s Metropolitan Transit Authority.

In this post, the always-insightful Tory Gattis comments on Randal O�Toole�s Wall Street Journal op-ed from over the weekend in which O�Toole focuses on the short-sighted nature of huge investment in light rail systems. At a time of fast technological innovation, why should a community place a substantial amount of its chips on an increasingly obsolescent form of mass transit such as light rail?

Meanwhile, Bill King followed his fine blog post from last week with this devastating Sunday Chronicle op-ed in which he disassembles each of the primary myths that Metro supporters use when defending the light rail system. In particular, King explains why the 2003 referendum is not a reasonable justification for what Metro is proposing now with regard to its light rail system:

The 2003 referendum had three elements: (1) a $1.2 billion LRT system; (2) a roughly 50 percent increase in bus service; and (3) initiating a plan for commuter rail.

Metro has completely abandoned the bus expansion: We have fewer buses and bus riders today than we did in 2003. It also has done absolutely nothing to further the development of any commuter rail lines and has instead gotten in the way of other groups like Harris County when they have tried to initiate some action. The voters in 2003 did not approve just a light rail plan; they approved a comprehensive, multimodal system. Metro, for its own reasons, has abandoned what the voters approved in favor of its own grandiose vision.

Additionally, it should be noted that the voters specifically restricted Metro to borrowing $640 million to build the light rail system. Metro now plans to subvert that limitation by entering into a sale/lease-back arrangement with a separate subsidiary and actually borrow more than four times what the voters approved. Metro is always quick to invoke the moral authority of the 2003 referendum but casually ignores its inconvenient restrictions.

Meanwhile, the Chronicle editorial board continues to live in a rather odd state of denial with regard to Metro. In this vacuous op-ed, the Chron attempts to put a cheery face on Mayor Parker�s appointment of several new members to the Metro board (one is actually �a regular Metro rider� � how about that?!) and her negotiations with federal officials regarding funding of further light rail lines.

Without any financial analysis whatsoever, the Chron asserts that Mayor Parker is moving forward with a �full build-out of light rail in a fiscally responsible manner.� But even a cursory review of the data proves just the opposite.

As Peter Gordon has long maintained, citizens should require their leaders to answer the following basic questions before allowing them to obligate citizens to funding boondoggles such as light rail: 1) At what cost?, 2) Compared to what? and 3) How do you know?

The Chronicle editorial board is taking a pass on asking Metro�s leaders those questions. Thankfully, Bill King and Tory Gattis are not.

Posted by Tom at 12:01 AM | Comments (0) |

March 21, 2010

Anna Netrebko - O mio babbino caro

Posted by Tom at 12:01 AM | Comments (1) |

March 20, 2010

I’d like one of these

Posted by Tom at 12:01 AM | Comments (0) |

March 19, 2010

Who’s better? Kobe or Clyde the Glide?

Clear Thinkers� favorite basketball stathead Dave Berri knows. The answer may surprise you:

Drexler�s career averages top Kobe�s marks with respect to shooting efficiency, rebounds, steals, blocked shots, and assists.  And yet Kobe is considered by many to be the better player.

There appear to be three explanations for why Kobe is thought to be the better player.  First .  .  . Kobe is the more prolific scorer.  Of course, this is because Kobe leads Drexler in field goal attempts.

Another issue is that Kobe spent his career with the Lakers while Drexler played for Portland and Houston.  In general, players for teams located in LA and New York tend to get more media exposure and therefore are thought of as better players.

And then there is the issue of championships won.  People tend to think players on championship teams are better than those who toil for teams that tend to lose in the playoffs.  It�s easy to point out the absurdity of such logic.  Teams win championships and one can pick up a ring just because you happen to have the right teammates.  After all, does anyone think Luc Longley (three titles) was a better center than Patrick Ewing (0 titles)? Or that Robert Horry (seven titles) was a better forward than Dominique Wilkins or Karl Malone (0 titles)?  Despite such obvious arguments, people will note that Kobe�s four titles must mean he�s a better guard than Drexler (1 title).

Berri goes on to provide a fascinating analysis of the Olajuwon-Drexler-Barkley Rockets team of the mid-1990�s and explains how close that team came to being really good.

I attended the first game that Clyde the Glide played at the University of Houston as a freshman in the early 1980�s. I was amazed at his all-around talent from that first game and that was well before Drexler developed an outside shot, which he learned to do after he entered the NBA.

Drexler was an outstanding in all phases of the game. It�s pleasing that smart folks such as Berri are teaching us that such a well-rounded player is more valuable than the narrow scorers that NBA teams and their fans have traditionally coveted.

Posted by Tom at 12:01 AM | Comments (1) |

March 18, 2010

Two fun how-to videos

 

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March 17, 2010

The Metro Train Wreck

The Metropolitan Transit Authority has been in the news recently mostly because of a good, old-fashioned document-shredding scandal and yet another spectacular crash.

But the more important issue facing Houstonians is that Metro is preparing to force large swaths of the community � including the key Uptown area near the Galleria -- to incur the enormous cost of enduring construction of its inefficient and impractical rail lines.

Bill King has spent a considerable amount of his time over the past several years studying Metro and Houston�s transit problems. In this devastating post, King finds that Metro is close to barreling completely out of any semblance of fiscal control:

There could hardly be a more fitting image for the close of the current Metro administration than the recent photographs for a wrecked Metro buses in front of Metro's headquarters after having been broad-sided by Metro's Main Street light rail. The last six years are likely to be remembered as the most ruinous time for public transportation in Houston's history as Metro has pursued a single-minded obsession to build its version of an at-grade rail system regardless of the cost, both in financial terms and in the degradation of the bus system on which over 100,000 Houstonians rely daily. Fortunately, Mayor Parker has ordered top-to-bottom review of the agency. Here is what that review is likely to find.

Decline in Ridership. Since 2004, Houston population has grown by over 10% from just over 2 million to 2.25 million. At the same time gas prices rose 47% from $1.81 per gallon to $2.67 per gallon. These two factors should have virtually guaranteed an increase in transit. However, exactly the opposite has occurred as bus boardings dropped almost 24% from 88 million in 2004 to 67 million in 2009. Instead of increasing bus service by 50% as it promised the voters in the 2003 referendum, Metro has slashed bus routes and increased fares by over 50%. Today Metro actually operates 225 fewer buses than it did in 2003. An outside performance audit in 2008 found that on-time performance fell by 29% from 2004 to 2008.

Financial Disaster. Since 2003, Metro's sales tax revenues have increased by 43%, rising from $357 million to $512 million. At the same time, its fare revenue increased by 41% from $42 million to $60 million by charging an ever dwindling ridership more. Yet, Metro is in the worst financial shape in recent history. At year end 2003 Metro's current assets exceeded its current liabilities by $125 million. The budget just adopted by the Metro board projects that it will have current accounts deficit of $165 million by the end of this fiscal year, a stunning loss of nearly $300 million in just five years. Over the same period, Metro's debt has swelled by nearly 50% from $546 million to $816 million. [.  .  .]

In the meantime, the cost of the [Metro�s Light Rail Transit lines] has risen from the $1.2 billion originally estimated to something well in excess of $3 billion. Metro is seeking to borrow $2.6 billion to build the LRT, over four times what it promised the voters would be the limit in the 2003 referendum. Originally, Metro assured voters that it could build the LRT without tapping the mobility payments that are so critical to the Houston and the other member cities. Metro's projections now show that it can only afford the LRT if those payments are terminated in 2014. [.  .  .]

In 2003, after a spirited public debate, this community approved, by a narrow margin, a consensus plan to enhance public transportation with a multi-modal approach. Part of that bargain was a limited experiment with a light rail system. The voters specifically limited the resources that Metro could devote to the light rail for fear that the cost might undermine the solid, dependable bus service that existed at that time. Metro's leadership has shredded that contract with the voters in favor of its own grandiose vision of transit that has little to do actually solving Houston's mobility problems. In the meantime, traffic congestion continues to get worse and working families that rely on public transportation to get their jobs everyday find riding Metro a more difficult and more expensive proposition.

Read King�s entire post. Metro�s defenders typically rely on the 2003 referendum as the primary basis for their continued support of such wasteful spending. But the problem with such referendums is that they ask voters to approve large public ventures such as Metro in a vacuum while ignoring Peter Gordon's three elegantly simple questions regarding economic choices:

1) At what cost?

2) Compared to what? and

3) How do you know?

For example, assume for a moment that voters were informed of the fact that the average urban freeway lane costs about $10 million per mile and that the average light rail line costs over $50 million per mile while carrying less than one-fifth as many people as the freeway lane. And these are only average figures.

Moreover, let's assume that voters were informed that the expenditure of a billion or so of public money on expanding a lightly-used light rail system has real consequences, such as leaving inadequate funds to make improvements to Houston's infrastructure that would dramatically decrease the risk of death and property damage from flooding. Or whether the billion or so being flushed down the light rail drain would be better used to fix various area traffic "hotspots" where accidents or bottlenecks occur with high frequency.

No one knows for sure, but my bet is that voting results would be dramatically different if the foregoing costs and alternatives were included as a part of the referendum.

Unfortunately, the relatively small groups that benefit from these urban boondoggles have a vested interest in keeping that threshold issue from ever being re-examined. The economic benefit of light rail is highly concentrated in only a few interest groups, such as political representatives of minority communities who tout the political accomplishment of shiny toy rail lines while ignoring their constituents need for more effective mass transit; environmental groups striving for political influence; construction-related firms that feed at the trough of Metro's poor investment decisions; and private real estate developers who enrich themselves through the increase in their property values along the rail line. As Professor Gordon wryly-noted in another post: "It adds up to a winning coalition."

Unfortunately, once such coalitions are successful in establishing a governmental policy subsidizing such boondoggles, it is much more difficult to end the public subsidy of the boondoggle than to start it in the first place.

None of these above-stated reasons for mass transit appeal to the vast majority of the electorate, so this amalgamation of interest groups continues to disguise their true interests behind amorphous claims that the uneconomic rail lines reduce traffic congestion (they do not), curb air pollution (they do not), or improve the quality of life (at least debatable).

How do these interest groups get away with this? The costs of such systems are widely dispersed among the local population of an area such as Houston, so the many who stand to lose will lose only a little while the few who stand to gain will gain a lot. As a result, these small interest groups recognize that it is usually not worth the relatively small cost per taxpayer for most citizens to spend any substantial amount of time or money lobbying or simply taking the time to vote against an uneconomic rail system.

Metro's rail system is a bad virus that has infected Houston. The cost of treating this civic virus is growing larger each month. Without immediate re-examination of Metro's light rail plan, the increasing costs of this plan risk turning this currently manageable problem into a major civic fiscal crisis that could negatively affect the Houston area's growth and prosperity.

As Bill King exhibits, real leadership involves recognizing that risk and addressing it, not indulging it.

Posted by Tom at 12:01 AM | Comments (2) |

March 16, 2010

My Lehman Bullshit

Mike over at the Crime and Federalism blog (a good blog, by the way) thinks my explanation yesterday of Lehman Brothers� controversial repo 105 transactions is bullshit.

Well, I�m as full of bullshit as anyone, but my sense is that Mike�s analysis is flawed. That�s not to say that the folks involved in reporting Lehman�s earnings to the marketplace after those repo 105 transactions didn�t commit fraud. I don�t know enough about the facts to know one way or the other.

The main point of my post is that a whole bunch of of executives, accountants, auditors, counterparties and governmental officials were swirling around Lehman at the time of these repo 105 transactions. As a result, the responsibility for any fraud is better allocated among the responsible parties in the civil justice system than in the criminal justice system, where guilt is adjudicated with a sledgehammer when a scalpel is more appropriate.

But one of the interesting aspects about Mike�s post is that he is very sure that he understands that Lehman committed fraud. So, let�s take a look at his example of what he thinks happened with regard to Lehman and the repo 105 transactions (my observations are in italics below each of his statements):

I ask you to invest $100,000 in my new business. You ask me how much money I have in my business account. I only have $5,000, but do not tell you this.

Okay, as my prior post noted, I concede that Lehman may have misrepresented its true liquidity position through the repo 105 deals.

I can sell everything the business owns (including all of our inventory) to a pawn shop for $100,000.

If Mike can sell all the assets of the business to a pawn shop for $100,000, then the business owns much more than $100,000 in assets. Pawn shops - much like the financial institutions with whom Lehman was dealing � do not engage in repo 105 transactions unless they are darn sure that they can liquidate the assets that they purchase for more than they paid if the seller breaches his obligation to repurchase the assets.

The pawn shop will sell me everything back for $105,000 if I come up with the money within 48 hours.  They won't even take possession of the property if I pay them within 48 hours.

I do not know of any pawn shop � or financial institution for that matter � that would be willing to leave property that they purchased in the hands of a financially-troubled seller, even for just 48 hours. Moreover, my understanding of the repo 105 transactions is that Lehman was not obligated to repurchase the asset for the sale price plus 5%. My understanding is that the �105� in repo 105 relates to the fact that financial institutions require property at least worth 105% of the purchase price that the financial institution pays the seller for the asset. I�m sure that Lehman�s counterparties required a steep fee for engaging in the repo 105 sales, but not 5% of the purchase price.

I make the "sale" to the pawn shop. I show you a copy of my bank statement. You can see that I have $105,000 cash in my bank account. I'm, in other words, liquid 100 grand. You loan me $100,000.

Here is where Mike is confused. Prior to taking the $100,000 loan, his company�s balance sheet actually looks a bit worse because of his sale to the pawn shop. The company has sold assets worth more than $100,000 in order to increase its liquidity to $105,000. No rational investor would make a $100,000 unsecured loan to a company with assets of only $105,000 cash that the investor would not have been willing to make when the company had $5,000 cash and over a $100,000 in non-liquid assets. But , let�s play along with Mike to get to his main point. After the loan, his company now has $205,000 in cash with a $100,000 liability.

I buy my stuff back for $105,000. I now have, thanks to you and some quick accounting fraud, $95,000.

No, that�s only part of it. The company now has repurchased its assets that are worth over $100,000, it has cash of $100,000 and a $100,000 liability. So, the company�s balance sheet is pretty much the same had the investor made his loan when the company only had $5,000 cash and over $100,000 of non-liquid assets. The only difference is that the investor feels deceived because he would not have made the loan under those circumstances.

So, maybe Mike�s investor in the example above has a good fraud case against the company (I�m not sure that�s the best way for the investor to recover his loan, but that�s another issue). But maybe not, too. And the situation that Lehman faced was far more complex than Mike�s hypothetical and involved a large number of well-intentioned people who were attempting to find any loophole available to save Lehman.

And that�s no bullshit.

Posted by Tom at 12:01 AM | Comments (0) |

March 15, 2010

The Enronization of Lehman Brothers

The big news in the business world at the end of last week and over the weekend was the publication of the examiner's report in the Lehman Brothers bankruptcy case.

The mainstream media jumped all over the report as a precursor to criminal indictments of former Lehman executives because of allegations in the report (that's all they are at this point) that Lehman used repo 105 transactions at the end of several quarters to make its balance sheet look more attractive than it really was. Fancy that, executives trying to stem a run on a trust-based business!

Despite the gathering MSM lynch mob, the truth is that the examiner's report is shaky grounds, at best, for criminal indictments against former Lehman executives. As folks who are experienced in bankruptcy realize -- but those who aren't don't -- an examiner's report is hardly an objective analysis of a debtor's affairs. Bankruptcy examiners are highly incentivized to recommend as many legal actions against the debtor's insiders and counterparties as possible. The fruits of those legal actions inure to the benefit of the bankruptcy debtor's creditors, which is really the only constituency in most bankruptcy cases that really can effectively challenge an examiner's compensation. As a result, feather nesting is not an unusual tactic of bankruptcy examiners.

Moreover, examiner's reports in bankruptcy cases are far from dispositive. I haven't read the Lehman examiner's report yet, but I'm skeptical of the MSM's initial rave reviews. The Enron examiner's report met with similar early favorable reaction, but it turned out to be chock full of plain factual errors and dubious conclusions based on those errors.

For example, the MSM's reporting of the examiner's conclusions regarding the timing of the repo 105 transactions doesn't make sense to me. As I understand those transactions, they improved Lehman's balance sheet by increasing its liquidity position at the end of several quarters through converting non-liquid assets to cash. When Lehman repurchased the assets after the date of the financial statement, the balance sheet didn't change much except for showing less liquidity because the repurchased asset - which went back on the balance sheet after the repurchase - was probably worth more than the liquidity used to repurchase it (I seriously doubt that the sharpies who were dealing with Lehman as it was going down in flames were consenting to using Lehman's trash assets in the repo deals).

At any rate, Peter Henning and Larry Ribstein have both done a good job of analyzing the main problem facing the Lehman insiders from a criminal standpoint. It is different and potentially more troublesome than the honest services wire fraud theory that was the basis of most Enron-related prosecutions. That is, the Lehman executives are subject to the provisions in the Sarbanes-Oxley legislation enacted after Enron's bankruptcy that impose criminal liability on executives who falsely certify the (i) accuracy of the financial statements and (ii) absence of deficiencies in internal controls regarding the preparation of the financial statements.

By the way, although Henning's analysis is quite good, his analogy of the repo 105 transactions to the Nigerian Barge transaction in the Enron-related criminal prosecutions is a stretch. The Nigerian Barge transaction was a relatively small deal in which Enron -- about an $80 billion market cap company at the time -- sold its interest in the Nigerian barges to Merrill Lynch to make a $12 million profit at the end of the particular quarter. On the other hand, the examiner alleges that Lehman was using repo 105 transactions to raise $35 - $50 billion of liquidity at the end of several quarters. Big difference.

Also, flying beneath the radar (as usual) is current Treasury Secretary Timothy Geithner and former Treasury Secretary Hank Paulson's role in all of this. As closely as Geithner (as head of the New York Federal Reserve) and Paulson (as Treasury Secretary) were monitoring Lehman during much of this time, it strains credulity that Geithner and Paulson didn't have at least some idea of what Lehman was doing to make its balance sheet as attractive as possible. Both Geithner and Paulson were intimately involved in attempting to broker a Bear Stearns-type bailout of Lehman.

So, if Geithner and Paulson knew what was going on, then how on earth is the federal government going to single out Richard Fuld and other former Lehman executives for criminal conduct?

Which brings us to the real lesson of all this -- that is, the inherently fragile nature of a trust-based business (related posts here) and the misguided nature of the notion that more governmental regulation will somehow protect investors from the next bust of such a business.

Larry Ribstein has been insightfully pointing out for years that more regulation of those businesses will not prevent the next meltdown, just as the more stringent regulations added under Sarbanes-Oxley after Enron's collapse did not prevent Lehman Brothers from failing. More responsive forms of business ownership certainly are a hedge to the inherent risk of investment in a trust-based business. But also helpful would be better investor understanding of the wisdom of hedging that risk and the importance of short sellers in providing information on troubled companies to the marketplace.

And as for criminal prosecutions? Unless there is evidence beyond a reasonable doubt of a crime, far better to allow the civil justice system allocate responsibility for Lehman's failure among the multitude of potentially responsible parties. Professor Ribstein nails this point in the final paragraph of his post:

The lesson here is that pursuing high-profile criminal prosecutions in Lehman after the problems with such prosecutions in these situations proved so manifest in Enron would prove that after a decade of hugely costly trials and a massive new law that was supposed to change everything, we still haven't learned a thing about the unsuitability of criminal liability for these kinds of cases.

Finally, Lawrence Kudlow and John Carney have an excellent seven-minute discussion below of the failure of governmental regulation in regard to Lehman:

Posted by Tom at 12:01 AM | Comments (4) |

March 14, 2010

50 Impressions in 50 Seconds

Posted by Tom at 12:01 AM | Comments (0) |

March 13, 2010

Dragonfly escape

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March 12, 2010

Exposing the myth of American exceptionalism

Conrad Black�s prison routine allows him time to think and write, which is a good thing in view of the enormous waste that results from his dubious imprisonment.

This week Lord Black takes aim at the myth of American exceptionalism promoted in this recent Richard Lowry and Ramesh Ponnurus essay (Walter McDougall has examined the origins of this myth in detail in the first two books of his fine three-part series on American history). In challenging the myth, Lord Black takes dead aim at a common topic on this blog � the overcriminalization of American life:

The wages of this [Cold War] victory have included the stale-dating of the authors� claim that America �is freer, more individualistic, more democratic, and more open and dynamic than any other nation on earth.� It is more dynamic because of its size, the torpor of Europe and Japan, and the shambles of Russia.

But Americans do not do themselves a favor by not recognizing the terrible erosion of their country�s education, justice, and political systems, the shortcomings of U.S. health care, the collapse of its financial industry, the flight of most of its manufacturing, and the steep and generally unlamented decline of its prestige.

.   .    .   Rampaging and often lawless prosecutors win 95 percent of their cases (compared to 55 percent in Canada), by softening the pursuit of some in exchange for inculpatory perjury against others, in the plea-bargain system. The U.S. has six to fourteen times as many imprisoned people as other advanced prosperous democracies, and they languish in a corrupt carceral system that retains as many people as possible for as long as possible. There are an astounding 47 million Americans with a �record,� and the country glories with unseemly glee in the joys of the death penalty. Due process and the other guarantees of individual rights of the Fifth, Sixth, and Eighth Amendments (such as the grand jury as any sort of assurance against capricious prosecution) scarcely exist in practice.

Most of the Congress is an infestation of paid-for legislators from rotten boroughs, representing the interests that finance their elections and exchanging earmarks with their colleagues like casbah hucksters.  .   .   .

Lord Black can sure still turn a phrase -- �casbah hucksters.� Ha!

Posted by Tom at 12:01 AM | Comments (9) |

March 11, 2010

Richard Justice’s confusion about David Carr

So, the Houston Chronicle�s Richard Justice is now writing in the San Francisco Chronicle that it was the fault of former Texans GM Charley Casserly and former head coach Dom Capers that former Texans QB David Carr did not develop into a decent NFL quarterback.

Of course, Justice extolled the virtues of that same Texans� management team immediately before their disastrous 2-14 season in Year Four of the franchise (2004):

The Texans have made good use of their honeymoon. They've drafted wisely and spent shrewdly on free agents. They've assembled a front office admired around the NFL. Their players seem to be quality people. [. . .]

The danger for them is that their greatest strength could become their greatest weakness. They've done so many things right and have built such a model operation that it's impossible not to put expectations on a fast track. [. . .]

So far, it's impossible not to be impressed with what the Texans have done. They are run as efficiently as any sports franchise I've ever been around.

Just before the start of training camp, Casserly gathered his employees and thanked them for all their hard work. Then he went down the list of different departments and explained some little thing each had done that made the team - and the organization - better.

That's the kind of thing the people who run sports franchises almost never do, and it left every person who was mentioned proud to be associated with the Texans.[. . .]

Capers believes it's vital to emphasize doing things right because "if you ever slip, you can never get it back."

So far, the Texans haven't slipped in any significant way.

In fact, look at what Justice was saying about the Casserly-Capers-Carr regime even after it had put up a horrid 1-8 record through nine games of the 2004 season:

The Texans are respectable. They're coming close. They've got four 2-7 teams left on their schedule. They almost won in Jacksonville, and they made a run at the Indianapolis Colts before losing 31-17 Sunday. [.   .  .]

The Texans are a better offensive team since [offensive coordinator Joe] Pendry took over [for the fired Chris Palmer]. David Carr looks like he's on his way to becoming a first-rate quarterback. He's quicker and more accurate in his throws, less likely to take a sack.

But then a couple of months later, after Carr and the Texans had cemented a perfectly awful 2-14 season, Justice had changed his tune to something similar to the one he sings now:

What we'll never know is what would have happened if Carr had gotten with an organization that knew what it was doing. The Texans never protected him or coached him, never put enough talent around him. Shame on you, Charley Casserly. Shame on you, too, Bob McNair. Maybe you guys were wrong about what David Carr could have been, but you never gave him a chance to find out.

Uh, Richard. Five seasons is long enough. Yes, the Texans� offensive line wasn�t all that good during that span. But Carr wasn�t very good, either, and that didn�t help the offensive line�s performance.

The bottom line is that David Carr was a poor NFL quarterback in Houston. Nothing that he has done with two other teams (with decent offensive lines) since his time here has changed that evaluation. The Texans made a big mistake in selecting him as the team�s first draft choice.

It really is that simple, Richard.

If you are interested in really first-rate analysis of the Texans, then check out local bloggers such as Stepanie Stradley, Lance Zerlein and Alan Burge. Their work beats the Chron sportswriters product hands down.

Posted by Tom at 12:01 AM | Comments (2) |

March 10, 2010

Smartphone Etiquette

I�m routinely amazed at how oblivious some people are regarding their rude cell phone manners. So, the 5Across video conversation below on smartphone etiquette interested me.

However, what starts as a discussion about smartphone etiquette turns into a more engaging conversation on the various ways in which different people are processing information in their daily interactions with friends and co-workers.

Proper etiquette is pretty simple. But the way in which people of different social and work groups communicate with each other is not. Watch this fascinating discussion and discover why.

Posted by Tom at 12:01 AM | Comments (2) |

March 9, 2010

The National Enquirer one ups the MSM

The Washington Post�s Paul Farhi makes the interesting point in this American Journalism Review op-ed that the biggest scandal in regard to the Tiger Woods affair may be that the National Enquirer tabloid newspaper did a better job of following proper journalistic procedures in breaking the scandal than much of the mainstream media did in follow-up reporting on it:

[National Enquirer Editor] Barry Levine finds himself surprised, appalled and somewhat amused by the way much of the mainstream media handled the Woods scandal. The Enquirer's original story, he notes, took months of reporting. It involved many hours of interviews, polygraph tests, stakeouts, document dives and travel. It was checked and re-checked.

But many members of the MSM, he notes, exercised no such care in reporting subsequent aspects of the story. "It would have taken us a couple of years to properly investigate each of these women's claims as thoroughly as we did the first" woman's, Levine says. "The stories were all over the place. There was just some outrageous coverage."

That's right. The editor of the National Enquirer doesn't think much of the way the "respectable" media covered Tiger Woods. Anyone paying close attention would concur that he has a point. It might be that the biggest scandal to come out of the Woods affair wasn't the one about a golfer. It was the one about the news media.

Meanwhile, The New York Times � that paragon of the mainstream media � is currently taking it on the chin around the blogosphere because one of its leading business reporters essentially doesn�t know what she is talking about in this article from over the weekend.

The blogosphere exposed the vacuous nature of how much of the mainstream media addressed complex issues. Now the tabloids are doing a better quality of reporting than many MSM publications on certain major stories. Will the mainstream media have any credibility or meaningful stature left when the reformation of how we process information is complete?

Posted by Tom at 12:01 AM | Comments (0) |

March 8, 2010

Making good on Baylor Med’s bad bet

The Chronicle�s Todd Ackerman and Loren Steffy did a good job in this weekend article of chronicling the series of bad bets that Baylor College of Medicine�s Board of Trustee�s made in the wake of the school�s unfortunate 2004 divorce from The Methodist Hospital. Baylor Med�s travails have been a regular topic on this blog, most recently here.

The elephant in the parlor of Baylor' Med�s financial problems is the $600 million in bond debt that Baylor Med incurred in connection with its currently mothballed hospital project. Indeed, the difference between the total bond debt and the value of the underlying collateral would gobble up a large chunk of Baylor�s endowment, which is currently a tad under a billion dollars. That was enough to scare off Rice University, although I question whether that was the right long-term decision for Rice.

So, the future is bit cloudy for Baylor. But what I�m wondering is whether there is a local partnership that could bail Baylor out of most of current problems while providing an essential benefit for the Houston community?

The last time I look into the issue, estimates in the Houston metro area has one of the largest percentages of uninsured residents in the U.S. (over 30% versus a national average of about 16%). The Harris County Hospital District ultimately ends up with the issues involved with financing indigent care as well as ensuring that adequate medical facilities exist for local citizens.

Given the HCHD�s projected need for facilities to keep up with the growth of the Houston area, it makes sense for the HCHD to engage Baylor in discussions over a partnership in which HCHD would make an investment in the hospital in return for Baylor�s agreement to staff the institution as its primary teaching facility.

Baylor and the HCHD already work closely in connection with the staffing of the Ben Taub Hospital trauma unit in the Texas Medical Center. A pure teaching hospital for Baylor would provide a quasi-public, low-cost alternative to the Med Center�s impressive but expensive array of private hospitals.

Sure, the details would have to be worked out, such as management of the facility. But doesn�t such an investment by the county make sense, particularly when compared to ones such as this?

Posted by Tom at 12:01 AM | Comments (2) |

March 7, 2010

The Last Four Minutes of Air France Flight 447

I've been meaning to pass along for awhile  this superb Gearld Traufette/Spiegel Online article on the continuing investigation into last summer's horrific crash of Air France 447 into the Atlantic Ocean (earlier post here).

Although the black box still has not been recovered (and quite likely won't be), investigators are becoming more confident that they understand what happened, including the following interesting theory:

According to this scenario, the pilots would have been forced to watch helplessly as their plane lost its lift. That theory is supported by the fact that the airplane remained intact to the very end. Given all the turbulence, it is therefore possible that the passengers remained oblivious to what was happening. After all, the oxygen masks that have been recovered had not dropped down from the ceiling because of a loss of pressure. What's more, the stewardesses weren't sitting on their emergency seats, and the lifejackets remained untouched. "There is no evidence whatsoever that the passengers in the cabin had been prepared for an emergency landing," says BEA boss Jean-Paul Troadec.

Read the entire article, including this informative graphic.

Posted by Tom at 12:01 AM | Comments (0) |

March 6, 2010

Colbert’s interview of Shaun White at the Olympics

"How much of your hair is Red Bull?"

The Colbert Report	Mon - Thurs 11:30pm / 10:30c
Shaun White
www.colbertnation.com
Colbert Report Full Episodes Political Humor Skate Expectations

Posted by Tom at 12:01 AM | Comments (0) |

March 5, 2010

The NBA Bubble

Looking for the next bubble to burst?

How about the National Basketball Association, where the local Houston Rockets play in what has been nicknamed �The Library on LaBranch� because of the lack of fan interest at their home games.

ESPN�s Bill Simmons dissects and then sums up the league�s dilemma well:

.  .  . The current system doesn't fly. The salary cap and luxury threshold ebb and flow with yearly revenue -- so if revenue drops, teams have less to spend -- only there's no ebb and flow with the salaries. When the revenue dips like it did these past two seasons, the owners are screwed.

They arrived at this specific point after salaries ballooned over the past 15 years -- not for superstars, but for complementary players who don't sell tickets, can't carry a franchise, and, in a worst-case scenario, operate as a sunk cost. These players get overpaid for one reason: Most teams throw money around like drunken sailors at a strip joint. When David Stern says, "We're losing $400 million this season," he really means, "We stupidly kept overpaying guys who weren't worth it, and then the economy turned, and now we're screwed."

This isn't about improving the revenue split between players and owners. It's about Andre Iguodala, Emeka Okafor, Elton Brand, Andrei Kirilenko, Tyson Chandler, Larry Hughes, Michael Redd, Corey Maggette and Luol Deng making eight figures a year but being unable to sell tickets, create local buzz or lead a team to anything better than 35 wins.

It's about Jermaine O'Neal making more money this season than Kevin Durant, Russell Westbrook, James Harden, Serge Ibaka, Eric Maynor, Thabo Sefolosha and Jeff Green combined.

It's about Rasheed Wallace -- a guy who quit on his team last season, then showed up for this one with 34Cs and love handles -- roping the Celtics into a $20 million, three-year deal that will cost Boston twice that money in luxury tax penalties.

With at least a dozen or so NBA teams facing serious financial problems, my sense is that the league is facing a radical restructuring whether the players like it or not. Of course, a substantial component of those teams� financial problems is attributable to the transfer of capital that many teams made to players as a result of not needing to rat-hole capital for arenas that local governments naively financed instead.

Sort of makes one re-think this boondoggle, eh?

Posted by Tom at 12:01 AM | Comments (1) |

March 4, 2010

Mel Gibson in Wiggly Piggly

Posted by Tom at 12:01 AM | Comments (0) |

March 3, 2010

An interesting health care finance contrast

This Sean P. Murphy/Boston Globe article details how local government-subsidized health insulation �insurance� plans are crippling municipal budgets throughout Massachusetts.

On the other hand, this WSJ op-ed by Indiana Governor Mitch Daniels explains how the state is saving $20 million of health care expenses in 2010 through the introduction of a highly-popular state employee health finance plan based upon Heath Savings Accounts.

This is not surprising. The most efficient way to spend less on health care is to consume less of it. As a result, someone � be it the consumer, an insurer or the government � at some point has to say no to the consumption of more health care. As Steve Lansburg recently pointed out, that eating more cake diet just doesn�t work. The WSJ's Holman Jenkins agrees.

Unfortunately, the present U.S. employer and government-based, third-party payor health care finance system provides powerful incentives to consume more health care. And, as Milton Friedman was fond of saying, consumers will consume as much health care as they can so long as someone else is paying for it.

Until we change the reliance on such consumer insulation from health care decisions, the dynamic of rising costs is unlikely to cease.

Posted by Tom at 12:01 AM | Comments (5) |

March 2, 2010

Jeff Skilling Day at SCOTUS

Got to love the response of Sri Srinivasan -- who handled yesterday's oral argument for Jeff Skilling in his appeal to the U.S. Supreme Court -- to the government's contention that a five-hour voir dire of the jury was sufficient in Skilling's trial to rebut the presumption of community prejudice against Skilling.

According to Lyle Denniston, whose account of the argument is the most comprehensive that I've seen, Srinivasan pointed out that the far less complicated criminal trial of Martha Stewart involved six days of juror selection in a case where there was no evidence of "deep-seated passion and prejudice" among jurors.

As Denniston notes, the SCOTUS Justices are usually hard to read during oral argument and the Skilling argument was no different. As Jeffrey Toobin notes in his recent book on the Supreme Court, Supreme Court decisions are often more the product of coalition-building between the Justices than the legal theories.

From reading Denniston's account and from talking with a couple of friends who attended the argument, I'm guessing that the Justices have already decided either to invalidate or dramatically limit the honest-services wire fraud statute (18 U.S.C. 1346), and that much or all of Skilling's conviction will be overturned on that basis. If I'm right on that, then the Justices are now only deciding whether to knock out Skilling's conviction entirely on the District Court's refusal to change venue from Houston or to conduct a thorough voir dire of jurors and leave the honest services issues for the other two pending cases involving the same issue.

But ignored among all the media reports on the Skilling SCOTUS argument is that the Skilling case is far from over even if SCOTUS were to uphold Skilling's conviction. Put on hold pending the outcome of the SCOTUS appeal is the Fifth Circuit's order to U.S. District Judge Sim Lake to re-sentence Skilling because of errors in the calculation of the length of the sentence.

But even more importantly, the Skilling team is awaiting the outcome of the Supreme Court appeal before filing what will certainly be a scalding motion for new trial in the District Court based on pervasive prosecutorial misconduct involved in the Enron Task Force's prosecution of Skilling.

And that could well be more revealing than any Supreme Court argument.

Posted by Tom at 12:01 AM | Comments (1) |

March 1, 2010

The Code

If this Larry Getlen/NY Post review of Jason Turbow and Michael Duca's new book The Baseball Codes: Beanballs, Sign Stealing, and Bench-Clearing Brawls: The Unwritten Rules of America's Pastime (Pantheon March 9, 2010) doesn�t get you in the mood for Major League Spring Training and the upcoming MLB season, then nothing will:

Unbeknownst to most outsiders, all aspects of baseball � from hitting, pitching, and baserunning to dealing with management and the media � are governed by the Code, a complex series of unwritten rules that have evolved since baseball's earliest days.

This Code, which the authors describe as "less strategic than moral," includes behavioral rules for common baseball situations; the punishment for flouting those rules; and the "omerta" that ballplayers must never, ever, discuss the rules of the Code outside the clubhouse. [.   .   .]

* Cardinal great Bob Gibson believed that the Code entitled him to knock down any batter who bested him with a grand slam. So when the Chicago Cubs Pete LaCock did just that, Gibson felt he owed him one � unfortunately, the homer came during Gibson's final game. Gibson finally took his revenge 15 years later, plugging LaCock in the back during an Old Timers Game.

* When the Yankees took on the Angels in 1987, the announcers discussed how Angels pitcher Don Sutton was scuffing the ball. Yankee owner George Steinbrenner, hearing this on TV, called Yankee manager Lou Piniella in a rage, demanding that the umpires inspect Sutton's glove. Piniella had to explain to the Boss, "The guy who taught Don everything he knows about cheating is pitching for us tonight. Want me to get Tommy John thrown out too?"

Posted by Tom at 12:01 AM | Comments (0) |

February 28, 2010

Cutting up at the Mayo Clinic

I never knew that the lobby of the Mayo Clinic could be such an entertaining place.

Posted by Tom at 12:01 AM | Comments (0) |

February 27, 2010

Crazy good ukulele

The amazing Jake Shimabukuro.

Posted by Tom at 12:01 AM | Comments (0) |

February 26, 2010

David Agus on the state of cancer research

University of Southern California University professor David Agus provides a particularly lucid 24-minute lecture for the TED conference on the state of cancer research.

Posted by Tom at 12:01 AM | Comments (0) |

February 25, 2010

The future of the death penalty

University of Houston Law Professor David Dow�s book -- The Autobiography of an Execution (Twelve 2010) � prompted Time to ask Dow several questions about the death penalty. A couple of his answers are particularly interesting:

.  .  . I tell people that if you're going to commit murder, you want to be white, and you want to be wealthy � so that you can hire a first-class lawyer � and you want to kill a black person. And if [you are], the odds of your being sentenced to death are basically zero. It's one thing to say that rich people should be able to drive Ferraris and poor people should have to take the bus. It's very different to say that rich people should get treated one way by the state's criminal-justice system and poor people should get treated another way. But that is the system that we have.

And what about the future of the death penalty?

My prediction is that we're going to get rid of it for economic reasons. We spend at least a million dollars more on a death penalty case than on a non-death-penalty case. In the U.S., where we've executed 1,200 people since the death penalty [was reinstated in 1976], that's $1.2 billion. I just think, gosh, with $1.2 billion, you could hire a lot of policemen. You could have a lot of educational programs inside of prisons so that when people come out of prison they know how to do something besides rob convenience stores and sell drugs. There are already counties in Texas, of all places, that have said, this is just not worth it: let's fix the schools and fill the potholes in the streets instead of squandering this money on a death-penalty case. You don't need to be a bleeding heart to make that argument.

Supporters of the death penalty reason that there is nothing morally wrong about the state killing a person as punishment for murder where that person was lawfully convicted in a fair and accurate criminal justice process. But in making that moral justification the central tenet of their support, death penalty supporters are ignoring the glaring defects in the process that undermine their moral justification.

Posted by Tom at 12:01 AM | Comments (3) |

February 24, 2010

No way to fight a war

Here we go again. U.S. military forces are put on the defensive because of what might be an unfortunate mistake in prosecuting the war against the Taliban.

When are we going to learn that fighting wars under unrealistic rules of engagement is a waste of time and precious resources?

A reasonable case can be made that the U.S. should not be conducting military operations in Iraq and Afghanistan. Similarly, a reasonable case can be made that such operations are necessary for the defense of the U.S.

But once the decision is made to commit military forces, no reasonable case can be made -- particularly given the enormous difficulties faced-- that U.S. Armed Forces should be constrained from winning the war by unrealistic rules of engagement.

If we are unwilling to stomach to do the dirty business that is necessary to win such wars, then we have no business getting involved in them in the first place. The defense summation in Breaker Morant brilliantly frames the issue in the context of Britain's involvement in the Boer War:

Posted by Tom at 12:01 AM | Comments (1) |

February 23, 2010

Gearing up for the Skilling SCOTUS argument

Oral argument on Jeff Skilling's appeal of his criminal conviction to the United States Supreme Court is next Monday afternoon, so the Skilling legal team warmed up for the occasion by filing the brief below in response to the Department of Justice's brief on the merits.

If you want to read the entire brief, then I recommend downloading it so that you will be have the version bookmarked in Adobe Acrobat that facilitates review.

As noted in the previous post on the DOJ's brief, the DOJ's case against Skilling has shrunk considerably, which is highlighted by the following Skilling reply brief passage on the DOJ's tepid defense of Skilling's conviction for honest services wire fraud under 18 U.S.C. 1346:

The Government's application of its proposed self-dealing category to Skilling's case demonstrates the continued manipulability of the statute under the Government's approach. In Black and Weyhrauch, the Government expressed the view that 1346 prohibits only bribes/kickbacks and self dealing, and that the latter category is implicated only when conflicting financial interests are "undisclosed." [references omitted]. That statement suggested that the Government would concede that Skilling did not commit honest-services fraud, because Skilling's only alleged personal financial interests arose from Enron's linking of his compensation to Enron's stock value, an interest that was fully disclosed.

But the Government nevertheless argues that Skilling committed honest-services fraud. To bring Skilling's case within the statute's compass, the Government creates a third category of honest services fraud, one that involves disclosed personal financial interests. The Government's cursory explanation of Skilling's honest-services liability (GB50) is hardly clear, but it appears to contend that while Skilling's "personal financial interests" were disclosed and generally aligned with Enron's interests, he put those interests in conflict when he took actions pursuant to his own disclosed compensation interest that were allegedly contrary to Enron's.

Accordingly, in this new category, what the defendant apparently fails to disclose is his scheme to put his own compensation interests ahead of his employer's distinct interests. Not only is that standard itself vague on its own terms, but the Government's repeated acknowledgement that Skilling's case has no precedent in pre-McNally case law (GB17, 49) confirms that this special crime is its own new category, created for the first time in the Government's brief in this Court.

It is time for prosecutors to stop making up crimes under this statute. If 1346 is not invalidated altogether, it should be limited to the single category of conduct universally recognized in the case law and hence largely immune from manipulation quid pro quo bribes and kickbacks.

Stated simply, the Enron Task Force prosecuted Skilling for business judgments that he made that turned out badly for Enron viewed through the clarity of hindsight bias. But Skilling didn't steal a dime from Enron and never took a kickback or a bribe. Those latter acts are crimes. Taking business risks that turn out badly is not.

At a time in which the U.S. economy desperately needs risk-takers to generate jobs and create wealth, here's hoping that the Supreme Court understands the difference.

Jeff Skilling's Reply Brief to the DOJ's Brief in his Supreme Court Appeal

Posted by Tom at 12:01 AM | Comments (3) |

February 22, 2010

A culture of abuse

The big legal news over the weekend is the Department of Justice�s decision not to recommend disciplinary proceedings against Cal-Berkeley law professor John C. Yoo and federal appellate Judge Jay S. Bybee for their participation in a series of DOJ memos that provided the dubious legal basis for the use of torture against enemy prisoners after the attacks of September 11, 2001. John Steele has done a great job of cataloging the blogosphere�s reaction to the DOJ�s decision.

The DOJ�s report outraged Jack Balkin, who opined that �the standard for attorney misconduct is set pretty damn low, and is only violated by lawyers who (here I put it colloquially) are the scum of the earth. Lawyers barely above the scum of the earth are therefore excused.� On the other hand, the Wall Street Journal contends that the report vindicates Yoo and Bybee. Yoo provides his own defense here.

Although the DOJ�s report paints a fairly clear case of Yoo and Bybee providing a colorable legal cover for what the interrogation tactics that the Bush Administration wanted to pursue come hell or high water, that conduct is utterly unsurprising. The DOJ has been engaging in torture-like treatment over the past year of Allen Stanford, who is still awaiting trial. Similarly, the DOJ has regularly engaged in other astonishing abuses of power in connection with the prosecutions of Jeff Skilling, Jamie Olis and many others.

Our failure to hold governmental officials responsible for abuse of power toward our fellow citizens helped create the culture in which the leap to sanction torture against enemy combatants was a small one. That culture will be very difficult to change.

Posted by Tom at 12:01 AM | Comments (2) |

February 21, 2010

Not in this weather

Mercedes-Benz contributes to the ongoing series of posts on creative commercials. Enjoy.

Posted by Tom at 12:01 AM | Comments (0) |

February 20, 2010

Rice rejects Hitler

Uh, oh. Hitler isn�t pleased that Rice University rejected his application for graduate school in philosophy. As Brian Leiter notes, the rejection must have been a result of that Stalin recommendation.

Posted by Tom at 12:01 AM | Comments (0) |

February 19, 2010

Dan Jenkins on Tiger

It was only a matter of time before the best (and crustiest) golf reporter of our time laid the wood to Tiger Woods:

I'll tell you what Hogan, Palmer and Nicklaus were at their peak.

They were every bit as popular as Tiger, they endured similar demands on their time, but they handled it courteously, often with ease and enjoyment.

They were accessible, likable, knowable, conversant, as gracious in loss as they were in victory, and, above all, amazingly helpful to those of us in the print lodge who covered them.

That was their brand. All the things Tiger never was.

As for Tiger's brand, boy, did that take a hit.

For all of the Tiger idolaters out there, it must have been like finding out that ice cream sundaes give you gonorrhea. [.  .  .]

I covered Tiger winning his 14 professional majors, but I can't say I know him. I knew the smile he put on for TV. I knew the orchestrated remarks he granted us in his press-room interviews. I knew the air he punched when another outrageous putt went in the cup. That's it.

I once made an effort to get to know the old silicone collector. Tried to arrange dinners with him for a little Q&A, on or off the record, his choice. But the closest I ever got was this word from his agent: "We have nothing to gain."

Now it's too late.

I'm busy.

It�s a shame that Woods never got around to getting to know Jenkins. He just might have found one of the real friends he needs.

Meanwhile, Golf Digest's Jaime Diaz -- the golf writer who has known Woods the longest and best -- provides this more in-depth article on Woods' life, as well as the expectations and pressures that may have contributed to his secret life.

Posted by Tom at 12:01 AM | Comments (3) |

February 18, 2010

Jamie Oliver’s TED Nutrition Talk

Jamie Oliver eloquently discusses the dire impact of our abysmal teaching about nutrition in the U.S. Check out also this lengthy Byran Appleyard/TimesOnline article on Art DeVany�s continuing research on the integration of good nutrition with sound exercise protocols. Good information for increasing the chances of enjoying a healthy life.

Posted by Tom at 12:01 AM | Comments (2) |

February 17, 2010

Greece and the Enron narrative

The New York Times� Floyd Norris is still having a hard time giving up the tired and largely debunked Enron narrative.

This time, Norris applies the Enron narrative to Greece, which supposedly hid its true financial condition from honest investors through engaging in complex derivative transactions with the ever-present and greedy investment bankers.

There is only big problem with Norris� morality tale. It�s not true.

As University of Houston finance professor Craig Pirrong points out in this blog post that runs rings around Norris and the Times� dubious analysis, what Greece was doing in using swaps engineered by the investment banks to finance its way into the European Monetary Union has been well known since the early part of this decade. Thus, as Professor Pirrong points out, �nobody  .   .   . has any more reason to be shocked about these transactions than Captain Reynaud had to be shocked about gambling going on at Rick�s.�

That includes Floyd Norris and the New York Times.

Posted by Tom at 12:01 AM | Comments (0) |

February 16, 2010

How much is “affordable” health care?

Uwe Reinhardt posted this insightful Economix post last week in which he bores in on the key issue to be resolved in reforming the U.S. health care finance system:

I could easily offer every American family a health insurance policy it could afford, simply by varying judiciously the annual deductible, the coinsurance rate, upper limits on items ostensibly covered by the policy and exclusions from coverage of sundry services or products � for example, mental health services or certain specialty drugs.

The policy might be a sham; but it sure would be cheap.

Health insurance is just a means by which needed health care can be made �affordable� to Americans when they fall ill. Therefore the proper target of health policy should be the family�s total outlay on health care, including out-of-pocket spending. That total outlay on �needed health care� should be made �affordable.�

Which requires us to define concretely, for practical purposes, what we mean by �health care� and �affordable,� pedantic as that may sound. Politicians should be forced to be utterly clear about it. [.  .  .]

President Obama could make this idea practical by using a visual device such as the table [above]. In that table �disposable income� is defined as all personal income from whatever source minus all personal income tax payments and other government deductions. The numbers are annual.  .   .   .

Professor Reinhardt makes a good point about the disingenuous nature of health insurance. As I noted here, most forms of health insurance � particularly the employer-based kind -- insulate consumers from understanding the truce cost of their health care choices. As a result, most consumers � and virtually all legislators in Washington � have no idea on what amount of health care costs are �affordable.� Most insureds are pleased that someone else is footing the bill and simply don�t want to lose that perk.

Health insurance is largely the product of bad governmental policy (wage controls during World War II) and, as is often the case with such policies, there are unintended consequences that are even worse than the misdirected governmental policy. In this case, we have two generations of Americans who have been largely insulated from needing to know the true cost of some of their most fundamental choices and needs in life.

Such ignorance is now hindering reform of the fractured U.S. health care finance system.  But any health care finance reform that does not rely at least in part on reigniting a consumer market to control costs will likely be even more expensive and less satisfying than the current system.

Posted by Tom at 12:01 AM | Comments (5) |

February 15, 2010

The common sense of civil unions

This WaPo article from last week on a recent WaPo/ABC News poll was interesting:

.  .  . opinions nationwide remain closely divided, but two-thirds of all Americans now say gay and lesbian couples should be able to have the same rights as heterosexual couples through civil unions.

In a new Washington Post-ABC News poll, 47 percent say gay marriages should be legal, with 31 percent saying they feel that way "strongly." Intensity is stronger among opponents, however: overall, half say such marriages should be illegal, including 42 percent who say so strongly.

Civil unions draw broader support. Two-thirds now say they favor allowing gay and lesbian couples to form civil unions that would give them many of the same legal rights as married couples.

Frankly, this is one of those contentious political issues for which there appears to be a simple solution. But implementing the solution will take some clear thinking, which is in short supply these days in our legislative circles.

The bottom line is that the state has no business being involved in the �marriage business.� That should be left to churches, some of which will approve gay marriages and some of which will not.

On the other hand, the state should provide for civil unions between same-sex and opposite-sex couples to promote societal stability through conferring the same rights relating to property, family, inheritance, etc. that are presently conferred through the institution of civil marriage.

For practical and legal purposes, such civil unions would be the same as civil marriages. And, as the poll numbers above reflect, most folks don�t have a problem with providing the same contractual and legal rights to gay couples through civil unions as opposite-sex couples presently enjoy through civil marriage. However, because most states presently only provide for civil marriage, the use of the term �marriage� becomes a hot button issue that provokes needless opposition to the implementation of the civil union concept in regard to same-sex couples to promote legitimate societal interests.

Thus, the solution is to have the state get out of the marriage business entirely and provide civil unions to opposite-sex and and same-sex couples. Many couples would still choose to get married in religious ceremonies, which is fine. But a couple that does not have access to marriage in a church would no longer be deprived of the legal and contractual rights that most states presently confer upon only married couples.

It sure seems as if this solution would solve the primary legal issues relating to continued state bans on gay marriages. Moreover, it would relegate the debate on marriage between same-sex couples to the churches and extract it from the political arena.

What�s not to like about that?

Posted by Tom at 12:01 AM | Comments (1) |

February 14, 2010

Happy Valentine’s Day

The lads sure did exude charisma, don�t you think?

Posted by Tom at 12:01 AM | Comments (2) |

February 13, 2010

Roberts on the bailout

Don't miss George Mason University economic professor Russ Roberts' lucid, four minute statement to a House Committee condemning the federal government's bailout of large financial institutions. The written statement is here. As I've been saying all along, it's not rocket science.

Posted by Tom at 12:00 AM | Comments (0) |

February 12, 2010

Milton Friedman on freedom, capitalism and colonialism

Got to love the way Friedman ignores the contentious introduction to the questions and maintains the integrity of intellectual discourse. H/T Almost Chosen People.

Posted by Tom at 12:01 AM | Comments (0) |

February 11, 2010

Lifestyle Nutritionists

In this clever sketch, That Mitchell and Webb Look channel the mentality behind the legislation discussed in yesterday�s post.

Posted by Tom at 12:01 AM | Comments (0) |

February 10, 2010

More misdirected Nanny energy

Does anyone really think for a moment that this legislation is going to have any meaningful impact on its intended purpose:

The Obama administration will begin a drive this week to expel Pepsi, French fries and Snickers bars from the nation�s schools in hopes of reducing the number of children who get fat during their school years.

In legislation, soon to be introduced, candy and sugary beverages would be banned and many schools would be required to offer more nutritious fare. [.   .   .]

The legislation would reauthorize the government�s school breakfast and lunch programs. It aims to transform the eating habits of many of the nation�s children and teenagers,  .   .   . 

No word yet on whether the legislation is also going to attempt to bar students from going to the neighborhood grocery or burger stand after school and buy the Pepsi, French fries and Snickers that the do-gooders won�t let them buy during school.

On the other hand, an initiative that really might generate some beneficial health changes � such as providing each student�s family lower health insurance premiums in return for family members maintaining a non-obese weight � remains illegal under applicable governmental regulatory schemes.

We really do find creative ways to waste time and energy, don�t we?

Posted by Tom at 12:01 AM | Comments (7) |

February 9, 2010

Final QB Ratings

Dave Berri just posted his final NFL quarterback ratings for the 2009 season, which are always interesting.

Schaub moved up into the top quarter of NFL QB�s, but he has a ways to go before he is playing on the level that Rivers and Brees played on this past season. Interestingly, there is a big drop off in production between Schaub at no. 8 to  Roethlisberger at no. 9.

Except for the truly great ones, QB�s are notoriously inconsistent from season to season, especially in comparison to basketball players and hitters in baseball. For example, Favre went from the 27th ranked QB last season to no. 4 this past season! That�s due primarily to the more complementary nature of football. Stated another way, it�s hard to be a productive QB when laying on one�s back or running for one�s life.

Thus, statistics really don�t tell us much about NFL QB�s (except when that QB is as bad as David Carr) other than the fact that a particular QB performed well this season does not necessarily mean that he will do so again next season.

Are you listening, Chron cheerleaders? 

Posted by Tom at 12:01 AM | Comments (1) |

February 8, 2010

The wisdom of Will

Tax simplification has been a frequent topic on this blog. So, I was enthused to see George Will knock the ball out of the park in describing the U.S. income tax system while addressing the issue in his WaPo Sunday column:

�Today's tax system was shaped by sadists who were trying to be nice: Every wrinkle in the code was put there to benefit this or that interest.�

The proposals that Will addresses would do more for the American economy than virtually any other proposal on the table at this point. Unfortunately, the proposals have virtually no chance of being implemented.

So it goes.

Posted by Tom at 12:01 AM | Comments (0) |

February 7, 2010

Super Bowl XLIV Primer

Too much is written about the Super Bowl each year, so it is increasingly difficult to separate the wheat from the chaff. The following are a few pieces that will provide a good primer for this year�s contest:

This Hank Gola/NY Daily News article provides a wonderful overview of the colorful history of the New Orleans Saints, including the eminently forgettable Charlton Heston flick, Number One.

I tend toward being a stathead, so this Football Outsiders post provided the requisite statistical analysis of the matchup between the Saints and the Colts. The bottom line � it�s a pretty darn even matchup.

If reading that post chloroformed you, Larry Ribstein lucidly explains why he doesn�t even watch the Super Bowl.

I�ve noted before that we tend not to appreciate the fact that Colts QB Peyton Manning may be the all-time greatest NFL quarterback and certainly is one of the top three. This Judy Batista/NY Times article updates Manning�s superb legacy while noting that his excellence is more a product of preparation, discipline and insight than physical tools. Also, check out this cool graphic on how Manning makes a split second read of the defense.

Finally, this equally interesting Greg Bishop/NY Times piece notes the not well-known fact that under-sized Saints QB Drew Brees � who has had one of the best four-season runs of any QB in NFL history � is actually one of the best athletes in the NFL. Brees explains in the video below how his San Diego-based personal trainer put together a fitness protocol that helped Brees recover from a devastating shoulder injury and prepares him for the grueling NFL season:

Posted by Tom at 12:01 AM | Comments (0) |

February 6, 2010

Kuroshio Sea

Kuroshio Sea - 2nd largest aquarium tank in the world - (song is Please don't go by Barcelona) from Jon Rawlinson on Vimeo.

Posted by Tom at 12:01 AM | Comments (0) |

February 5, 2010

Justice Kennedy notices a couple of troubling issues

Overcriminalization of life and the appalling condition of our country�s prison facilities have been frequent subjects on this blog over the years. At least one member of the U.S. Supreme Court has taken notice:

U.S. Supreme Court Justice Anthony M. Kennedy criticized California sentencing policies and crowded prisons Wednesday night, calling the influence that unionized prison guards had in passing the three-strikes law "sick."

In an otherwise courtly and humorous address to the Los Angeles legal community, Kennedy expressed obvious dismay over the state of corrections and rehabilitation in the country. He said U.S. sentences are eight times longer than those issued by European courts.

"California now has 185,000 people in prison at $32,500 a year" each, he said. He then urged voters and officials to compare that expense to what taxpayers spend per pupil in elementary schools.

"The three-strikes law sponsor is the correctional officers' union and that is sick!" Kennedy said of the measure mandating life sentences for third-time criminal offenders.

As Doug Berman points out, perhaps Justice Kennedy�s remarks are a prelude to the Supreme Court�s consideration of several important sentencing cases in its upcoming term. At some point, we need to ask ourselves the question � why are we doing this to ourselves?

Posted by Tom at 12:01 AM | Comments (2) |

February 4, 2010

Different eras, similar swings

Ben Hogan and Anthony Kim.

Posted by Tom at 12:01 AM | Comments (0) |

February 3, 2010

How to complete a census

2010 is a census year, so it�s a good time to recall one of the best Saturday Night Live skits ever, Christopher Walken answering a census taker�s questions. Enjoy.

Posted by Tom at 12:01 AM | Comments (0) |

February 2, 2010

Running into the abyss

17th century philosopher Blaise Pascal observed in his Penses that we run heedlessly into the abyss after putting something in front of us to stop us seeing it.

Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program, observed something similar in his quarterly report regarding the troubled TARP program:

The government's bailout of financial institutions deemed "too big to fail" has created a risk that the United States could face a worse fiscal meltdown in the future, an independent watchdog assigned to review the program told Congress on Sunday.

The Troubled Assets Relief Program, known as TARP, has not addressed the problems that led to the last crisis and in some case those problems have festered and are a bigger threat than before, warned Neil Barofsky, the special inspector general at the Treasury Department.

"Even if TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car," Barofsky wrote.

Barofsky wrote the $700 billion financial bailout has encouraged more risk-taking because bank executives, who are still receiving massive bonuses, figure the government will come to the rescue the next time they steer their ships nearly aground.  .   .   .

None of what Barofsky reports is a surprise to regular readers of this blog. It was not rocket science.

Posted by Tom at 12:01 AM | Comments (0) |

February 1, 2010

The Thrilla in Manila

As we prepare for the media tedium this Super Bowl week, it is a good time to appreciate the SI Vault, Sports Illustrated�s wonderful web archive of outstanding sports stories from the past.

For example, check out this article by Mark Kram chronicling 1975�s Thrilla in Manila, the epic heavyweight championship fight between Muhammad Ali and his arch-nemesis, Joe Frazier. The following is his conclusion:

In his suite the next morning [the victorious Ali] talked quietly.

"I heard some-thin' once," he said. "When somebody asked a marathon runner what goes through his mind in the last mile or two, he said that you ask yourself, Why am I doin' this? You get so tired. It takes so much out of you mentally. It changes you. It makes you go a little insane. I was thinkin' that at the end. Why am I doin' this? What am I doin' in here against this beast of a man? It's so painful. I must be crazy.�

�I always bring out the best in the men I fight, but Joe Frazier, I'll tell the world right now, brings out the best in me. I'm gonna tell ya, that's one helluva man, and God bless him."

Posted by Tom at 12:01 AM | Comments (0) |

January 31, 2010

Lone Survivor

I recently finished reading Lone Survivor: The Eyewitness Account of Operation Redwing and the Lost Heroes of SEAL Team 10 (Little, Brown and Company 2009), Marcus Luttrell's engrossing story of his experience in surviving a vicious battle against the Taliban in Afghanistan. I recommend the book highly to anyone who is interested in United States foreign policy.

Lone Survivor is not a great book. A substantial part of it - particularly the parts of Luttrell's Navy SEAL training - are repetitive and unnecessary. Likewise, Luttrell's political views are somewhat simplistic and do not add much to the story.

But Luttrell's story is spot on in portraying the troubling problem that the U.S. Armed Forces face in fighting wars under rules of engagement that constrain doing what is necessary to accomplish the purpose of the war. During their mission, Luttrell and his squad mates had to make a key decision under the rules of engagement -- and it was not even a clearly wrong one -- that ultimately resulted in a disaster for the squad.

Luttrell's story is also insightful from a cultural standpoint. After fending off over a hundred Taliban attackers in battle, Luttrell was ultimately saved by members of an Afghan community who decided to resist the Taliban. The cultural dynamics at play are as confusing as they are fascinating.

Should the United States be sending true American heroes such as Luttrell and his comrades into such a complicated cultural conflict under rules that hinder them from accomplishing the mission?

It is a question that should be much more difficult for our government's leaders than it appears to be.

Posted by Tom at 12:01 AM | Comments (2) |

January 30, 2010

At one time, the NY Times was an interesting place to work

From Big Think, Guy Talese wonders how on earth he and his co-workers at the New York Times ever got the paper to publication:

Posted by Tom at 12:00 AM | Comments (2) |

January 29, 2010

Tales of Two Lives

Wednesday�s Congressional testimony of Treasury Secretary Timothy Geithner and the Department of Justice�s incredible shrinking case against former Enron CEO Jeff Skilling got me to thinking.

Geithner has made his share of dubious decisions over the past several years. I think he was wrong not to allow the markets to allocate the risk that many financial institutions took, particularly in regard to American Insurance Group. As a result of these decisions, I don�t think he should be the Secretary of the Treasury.

But I do not think it is fair to question that Geithner honestly believed that the actions he took were necessary to save the U.S. and world financial systems from chaos. You, like me, may not believe he was right about that, but there is little question that he honestly believed that he was mitigating the risk of a financial tsunami.

Turning to Skilling, the DOJ�s case against Skilling now boils down to several alleged misrepresentations that Skilling approved regarding a couple of financially-troubled divisions of Enron. But the overwhelming evidence at trial was that Skilling truly believed that the statements he approved regarding those divisions were accurate.

For example, one of those divisions � Enron Broadband � was attempting to develop and deliver the video-on-demand service that is now a popular and profitable product of digital television and such gadgets as Apple's iPod. These systems are a creative accommodation to copyrighted music and video programming that has generated enormous wealth for artists and shareholders of companies in the business.

Skilling testified at trial about his optimism regarding Broadband:

�And one last thing -- I'll make the last one argument for Broadband because people criticize me about Broadband, and I will take the criticism. We -- certainly, we made a mistake. But it wasn't big. I mean, it was a billion dollars. We invested a billion dollars in the Broadband business. If it had worked, it could have been worth $30 billion. It didn't work. We lost a billion dollars, but if you can make those kinds of bets, that's the kind of the risk you [should be taking] as a corporation. And if you do a lot of [deals with a] downside of a billion and upside of 30 [billion], you're doing a good job for your shareholders in the long run, in my opinion. This one didn't work.�

Given the current value of video-on-demand technology, Skilling's valuation of Enron's Broadband business opportunity was probably low. But regardless of the wisdom of Enron�s timing in investing in that technology, there is little question that Skilling honestly believed that Enron Broadband could generate enormous wealth for Enron�s shareholders.

Geithner will probably leave the Treasury soon and return to a Wall Street firm to make his fortune. Skilling lost his fortune and remains in a Colorado prison, where he is enduring a 24-year prison sentence.

I submit that no rational basis exists for the radically different futures of these two men.

Posted by Tom at 12:01 AM | Comments (2) |

January 28, 2010

The DOJ’s Merits Brief in the Skilling Appeal

On the heels of last month�s filing with the U.S. Supreme Court of Jeff Skilling�s brief on the merits of his appeal to the U.S. Supreme Court, the Department of Justice filed its brief on the merits of Skilling�s appeal earlier this week.

A copy of the brief is below, but I recommend downloading it so that you will have the version bookmarked in Adobe Acrobat that facilitates review of the brief.

The DOJ�s brief is surprising in a couple of key respects.

First, the DOJ�s case against Skilling has shrunk dramatically. The DOJ now bases its entire case on Skilling�s involvement in alleged misrepresentations that were made to the market regarding two Enron divisions, Enron Broadband Services and Enron Energy Services. Nothing in regard to the dubious Nigerian Barge transaction. No mention of the theory that Enron�s earnings were lagging in 1999 and that�s why the reason why Skilling supposedly had former CFO Andrew Fastow engineer the allegedly corrupt LJM special purpose entity. Heck, there is not even a mention of the supposedly key Global Galactic Agreement. I mean really � is the DOJ even talking about the same case that it tried?

Stated simply, has the DOJ�s entire case against Skilling now been reduced to his optimistic statements about those two divisions?

The other surprising aspect of the brief is the DOJ�s apparent surrender on the lack of private gain issue in regard to Skilling�s conviction on honest services wire fraud. Check out this reasoning from p. 50 of the brief:

Petitioner had, and acted upon, his personal financial interests, which conflicted with those of the shareholders to whom he owed a fiduciary duty. The company and its shareholders attempted to align their long-term interests with petitioner�s by linking his compensation to stock price. But the obvious premise of that arrangement was that petitioner would act to maximize shareholder wealth. Petitioner subverted that premise, and placed his interests in conflict with that of the shareholders,when, for his own financial benefit, he engaged in an undisclosed scheme to artificially inflate the stock�s price by deceiving the shareholders and others about the company�s true financial condition. That conduct constituted fraud. The only question here is whether the public nature of petitioner�s compensation scheme prevents his conduct from constituting honest services fraud. It does not. Although petitioner�s basic compensation scheme was public, his scheme to artificially inflate the company�s stock price by misrepresenting its financial condition, in order to derive additional personal benefits at the expense of shareholders, was not. Petitioner�s deception deprived shareholders of the information they needed to make informed decisions and thereby defrauded them of his honest services.

So, what about the shareholders who sold stock at the allegedly inflated price resulting from Skilling�s supposed deceptions? Did Skilling defraud them, too? If so, I can think of quite a few investors who wouldn�t mind being defrauded like that.

And what about Skilling himself, who continued to acquire large amounts of Enron stock right up to the time he resigned from the company several months before its collapse. Did Skilling�s alleged �deception deprive [Skilling] of the information [he] needed to make informed decisions and thereby defrauded [himself] of his honest services.�

I�ll bet that reasoning will raise a few questions during oral argument, which is currently scheduled for the afternoon of March 1st.

DOJ Merits Brief in Skilling Appeal

Posted by Tom at 12:01 AM | Comments (1) |

January 27, 2010

Positively 4th Street

Posted by Tom at 12:01 AM | Comments (0) |

January 26, 2010

Checking in on the Rockets at the halfway point

The football season still has two weeks to go and the NBA season is already at the halfway point?

The always interesting Dave Berri posted his wins produced/productivity stats for each NBA player through mid-season yesterday. As usual, the statistics reveal some interesting developments:

• Unsurprisingly, LeBron James is the most productive NBA player so far this season. Surprisingly, Gerald Wallace of Charlotte is the second-most productive player.
• So far this season, there are no super teams, but a bunch of really good ones. The top teams in the NBA in terms of Wins Produced and efficiency differential are the Lakers, Cavaliers, Celtics, Hawks, and Spurs, each of which posted a Wins Produced mark of more than 27.5, which means that each such team is halfway to 55 wins.  Denver, Orlando, Portland, and Utah are halfway to 50 wins.
•  The Rockets are over-achieving a bit, having generated 23 wins out of a Wins Produced and efficiency differential score of 21. Blue-collar PF Luis Scola is the most productive Rocket at 5 Wins Produced, while flashy PG Aaron Brooks � who the Chronicle sports page christened the new Rockets star last week � is the least productive Rocket player in the regular rotation at 0.9 Wins Produced.
• The most productive player at each position so far this season are as follows: SF James (13.8 Wins Produced); PF: Marcus Camby (11.8 Wins Produced), C: Dwight Howard (10.0 Wins Produced), PG: Chris Paul (9.8 Wins Produced), and SG: the 76er�s Andre Iguodala (8.0 Wins Produced).

This season�s edition of the Rockets is an entertaining mix of good complementary players who move the ball very well offensively and generally play hard-nosed defense.

But they don�t shoot particularly well as a team and the lack of an inside presence defensively hurts the Rockets. Barring a major injury, the Rockets might make it to 45 wins, but my sense is that breaking even (i.e., 41 wins) would be a good performance by this club given its personnel limitations at this point in time.

With the Tracy McGrady contract expiring after this season, look for the Rockets GM Daryl Morey to make a deal for a go-to player either at some point during the remainder of this season or in the off-season. Thus, despite their gritty play so far this season, I would not be surprised if the Rockets� nucleus looks substantially different going into next season.

Posted by Tom at 12:01 AM | Comments (0) |

January 25, 2010

Visiting Florence

Regular readers of this blog know that I've been traveling to Florence, Italy frequently over the past year to visit my son Andy, who is attending the Angel Academy of Art there. Here is slideshow of photos from that beautiful city with musical accompaniment from Alison Krauss and Robert Plant. Enjoy!

Posted by Tom at 12:00 AM | Comments (0) |

January 24, 2010

Winter Golf in The Woodlands

The following are recent photos of the Tournament Course at The Woodlands that I recently took during a brilliant Texas morning in January with my buddies, Jerry Sagehorn and John Stevenson.

The Tournament Course is still known to most Houstonians as "the TPC" from the days when the course was known as the Tournament Players Course at The Woodlands. Opened as The Woodlands East Course in 1978, the TPC is a wonderful design from the collaboration of Robert Von Hagge and Bruce Devlin from their time together in the late 70's and early 80's.

In the mid-1980's, the Houston Golf Association and the PGA Tour arranged a licensing arrangement with The Woodlands Corporation and The Woodlands Country Club in which the East Course was transformed into a Tournament Players Course with the typical spectator mounds found on such courses. After that, the HGA moved the Houston Open golf tournament to the TPC and, for the following 18 years, the tournament enjoyed its most successful run in its long history. As a result, Shell Oil Corporation decided to become the tournament's title sponsor, which solidified the Houston Open as one of the top second-tier tournaments on the PGA Tour.

When the HGA decided to move the Houston Open to Redstone in 2002, the license deal with the PGA Tour was terminated and the TPC reverted to The Woodlands Country Club, where it is now one of that club's three courses and one of the seven courses in The Woodlands (two others are here and here). A couple of years ago, the Champions Tour moved its Houston tournament to the TPC, a move that has catapulted that tournament into one of the top Champions Tour events because of the popularity of the TPC among the senior players.

The TPC is a joy to play and one of the best courses in the Houston area. From the men's tees, it's a pleasant 6600 yards (131 slope rating; 7000 yards and 138 slope from the tips) and is a great course to walk.  It has a wonderful variety of holes, punctuated by the final two holes -- 17 (nicknamed "the Devil's Bathtub") and 18 - a long par 4 over water - are two of the two finest finishing holes that you will find anywhere.

The photos below are presented in two formats, the first of which is a video with musical accompaniment from Alison Krauss and Robert Plant and the second of which is a Google Picasa slideshow with my comments on each photo. You can download a high resolution copy of the video playable on Quicktime Player here.

I love the contrast in the photos between the light brown of the dormant Bermuda grass with the various shades of greens of the trees, winter rye-seeded tee areas and the lightly overseeded greens. Enjoy!

Update: Another slideshow of the course, this time on a cool Autumn morning with the course in full bloom, is here..

Posted by Tom at 12:01 AM | Comments (1) |

January 23, 2010

There’s a Light Beyond These Woods

The incomparable Nanci Griffith.

Posted by Tom at 12:01 AM | Comments (0) |

January 22, 2010

Sharp cheddar

In our continuing series of splendidly creative commercials, check out this one for Norm�s Cheddar (H/T Bill Hesson):

Posted by Tom at 12:01 AM | Comments (1) |

January 21, 2010

We sure have progressed, haven’t we?

Larry Ribstein points us to the abstract of a new Peter Leeson paper, Ordeals:

For 400 years the most sophisticated persons in Europe decided difficult criminal cases by asking the defendant to thrust his arm into a cauldron of boiling water and fish out a ring. If his arm was unharmed, he was exonerated. If not, he was convicted. Alternatively, a priest dunked the defendant in a pool. Sinking proved his innocence; floating proved his guilt. People called these trials ordeals.

No one alive today believes ordeals were a good way to decide defendants' guilt. But maybe they should. This paper investigates the law and economics of ordeals. I argue that ordeals accurately assigned accused criminals' guilt and innocence. They did this by leveraging a medieval superstition called iudicium Dei. According to this superstition, God condemned the guilty and exonerated the innocent through clergy conducted physical tests.

It sure is comforting to know that we sophisticated modern folk no longer believe that such ordeals are a good way to decide the guilt of a defendant.

On the other hand .   .   .

Posted by Tom at 12:01 AM | Comments (0) |

January 20, 2010

The growing threat of prosecutorial power

A frequent topic on this blog is the overcriminalization of American life, particularly in regard to taking business risks that create jobs for communities and wealth for citizens.

One of the most lucid writers on this disturbing trend is William Anderson (prior posts here), an economics professor at Frostburg State in Maryland. In this recent Regulation magazine article for the Cato Institute, Professor Anderson provides an excellent overview of how the federal government has gradually imposed police state-type laws on us that allow prosecutors to target citizens for a criminal case and then rationalize a crime from any number of vague criminal statutes:

The numbers tell a harsh story. In 1980, there were about 1,500 federal prosecutors and approximately 20,000 federal prisoners. Today, there are more than 7,500 U.S. attorneys and more than 200,000 federal prisoners, according to an October 2009 count. About 52 percent of federal prisoners are drug offenders, reflecting the emphasis of the �War on Drugs,� and while there is no specific �white collar� crime category, one estimates, using Federal Bureau of Prisons statistics, that about 5 to 10 percent of the federal prison population consists of people convicted of white collar crimes.

The federal criminal code is growing. In the early days of the republic, there were three federal crimes: piracy, treason, and counterfeiting. Today, there are more than 4,000 federal criminal laws and more than 10,000 regulations that prosecutors easily can fold into the criminal statutes.  .   .  .

In surveying this sad state of affairs, Anderson notes one of the perverse incentives driving these dubious prosecutions:

The resulting near-free reign that prosecutors have in federal court is an open invitation to abuse of the law and the legal system. To make matters worse, federal prosecutors enjoy almost total legal immunity and are unlikely to face any sanctions no matter how dishonest or abusive their behavior might be; the rules that apply to everyone else do not apply to U.S. attorneys. [.  .  .]

The only thing that stands between almost any American and doing a stretch in federal prison is the choice of whom prosecutors will target. This is a serious problem that shows no signs of disappearing.

The fact that one such prosecutor in Massachusetts was even seriously considered by many in that state for a position in the U.S. Senate reflects that citizens still have not grasped the extent of this awful trend in American society.

It makes one wonder what it�s going to take for Americans to stand up and put a stop to this?

Posted by Tom at 12:01 AM | Comments (0) |

January 19, 2010

Did Rice blow it?

So, Rice University last week finally decided to pass on the proposed merger with Baylor College of Medicine.

In theory, the deal makes sense. Both are top-notch academic institutions with campuses within a stone�s throw of each other. Each institution would have given the other something that it needs. Baylor would have gotten the financial support of Rice�s multi-billion dollar endowment, while Rice would have landed a strong scientific research and clinical care center in one of the nation�s leading medical institutions, the Texas Medical Center.

Although Rice President David Leebron supported the merger, large segments of the Rice faculty and alumni opposed the deal, primarily on financial and cultural grounds. Indeed, my sense is that Leebron quit pushing the Rice Board of Trustees to approve the deal when it became apparent that a consensus of Rice constituencies were opposed to the marriage.

And Baylor clearly finds itself in precarious financial condition, not completely of its own doing. After its 54-year teaching hospital relationship with Methodist Hospital soured in 2004, and a subsequent deal with St. Luke�s Episcopal Hospital did not work out, BCM decided on a plan to go it alone and build its own teaching hospital.

However, the ambitious deal has been pretty much a disaster from the start. After floating almost $900 million in bonds to finance construction of the hospital, Baylor announced last year that it was temporarily suspending construction of the hospital�s interior as it works through its financial problems.

Meanwhile, BCM has lost over $300 million since the split with Methodist. Inasmuch as Baylor�s endowment is less than a billion, those kinds of losses have placed BCM�s financial condition at risk. Already in in technical default on multiple bond covenants, BCM is now facing the prospect of hiring a bondholder-required �chief implementation officer� to oversee an overall financial reorganization. That would have been avoided if the Rice merger had succeeded.

Thus, Rice certainly had understandable reasons for passing on the deal.

Nevertheless, I wonder � did Rice make the right decision?

Despite its financial woes, BCM remains one of the elite medical and research institutions in the U.S. The merger would have undoubtedly brought a substantial increase in research funds in such fields as bioengineering, neurobiology, nano-biotechnology, stem cell biology and gene therapy. Although Rice would have been subsidizing BCM�s financial problems in the short term, my sense is that the increase in research resources flowing to Rice over the years would ultimately make that bailout well worth it.

But even more importantly, Rice passed on an opportunity to take a calculated risk that could well have elevated Rice, BCM, the Texas Medical Center and Houston to the forefront of medical and scientific research in the world.

Despite the risks, that kind of upside doesn�t come around very often. Failing to realize that is one of the key reasons why Texas has lagged badly behind states such as California and New York in the development of Tier 1 research institutions and all the benefits that such institutions provide to the state and its communities.

Thus, Rice is keeping its chips and betting that it can develop its scientific research just fine without BCM. But if I were to place a bet on which institution is closer to the cutting edge of such research after the next 25 years, I�m still putting my chips on Baylor.

Posted by Tom at 12:01 AM | Comments (4) |

January 18, 2010

So, you want to be a big-firm deal lawyer?

Continuing to fly well beneath the radar screen -- probably because lawyers don't want to talk about it except in hushed tones -- is the seven-year prison sentence that former Mayer Brown partner Joseph P. Collins was handed late last week.

As this earlier post explains in detail, Collins was the former outside deal lawyer for Refco, Inc., which unraveled back in 2005 under the weight of public disclosure of a series of insider transactions that were apparently designed to hide millions in liabilities from customers and investors.

As the earlier post notes and as the Memorandum of Law in support of a new trial for Collins explains, whether Collins even knew about the allegedly fraudulent nature of the transactions is highly questionable and whether he hid those transactions from anyone is even more dubious. But that hardly matters in this era of "let's hammer the white-collar defendant."

Meanwhile, Collins' family will be deprived of the presence of their father for seven years.

What is it going to take for this madness to stop? A truly civilized society would find a better way.

Memorandum of Law in Support of New Trial for former Refco, Inc outside counsel, Joseph P. Collins

Posted by Tom at 12:01 AM | Comments (0) |

January 17, 2010

Tech update

Sorry about the problems accessing the blog over the past couple of days. The blog�s host server went down, so everything had to be migrated to a new server. It looks as if things are working reasonably well now.

Be sure to check out Friday�s post on the developments in the Enron-related Nigerian Barge case. What a strange, wild ride it has been.

Thanks for the patience and for reading HCT.

Posted by Tom at 3:16 PM | Comments (0) |

January 15, 2010

One step forward, a big step back

Well, so finally the Department of Justice did the right thing and dismissed the remaining criminal charges against former Merrill Lynch banker, Dan Bayly, in connection with the shameful Enron-related Nigerian Barge prosecution.

Even in the heavily-littered landscape of failed Enron-related prosecutions, the Nigerian Barge prosecution stood out for its sheer brazen nature. As noted in this post from over five years ago (!), the Nigerian Barge prosecution was baseless from the start and, as later developments revealed, trumped-up to boot.

After prosecuting Arthur Andersen out of business in the intensely anti-business post-Enron climate of Houston in 2004, the Enron Task Force threatened to do the same to Merrill Lynch unless the firm served up some sacrificial lambs, which it did by offering Mr. Bayly, Robert Furst, James Brown and William Fuhs.

Through a deferred prosecution agreement with Merrill, the Task Force then proceeded to hamstring the Merrill defendants' defense by limiting access to other Merrill Lynch executives who were involved in the barge transaction. To make matters worse, the Task Force then intimidated other potentially exculpatory witnesses by threatening to indict them if they cooperated with the Merrill defendants� defense.

Thus, after bludgeoning a couple of plea deals from former key witnesses Ben Glisan and Michael Kopper, the Task Force proceeded to put on a paper-thin case against the defendants, which was good enough to obtain convictions.

Of course, most of the convictions were vacated on appeal (and in Fuhs' case, thrown out completely), but not before each of the Merrill defendants had served over a year in prison and their families had incurred the incalculable human cost of these misguided prosecutions.

Incredibly, over the past couple of years, the Department of Justice (the Enron Task Force has, mercifully, been disbanded) actually has been threatening to pursue a re-trial of the Merrill defendants. Accordingly, the dismissal of the remaining charges against Mr. Bayly was good news. A similar dismissal of charges against his remaining co-defendants - Messrs. Furst and Brown � would certainly follow, right?

Apparently not, at least for the time being. Inexplicably, the DOJ announced yesterday that it is continuing to pursue charges against Mr. Furst.

So, Mr. Furst unloaded on the DOJ yesterday with the filing of this motion to dismiss on the grounds of pervasive and egregious prosecutorial misconduct. You can review the motion here, but if you go ahead and download it, then you can review a version of the motion that is bookmarked in Adobe Acrobat to facilitate ease of review. Inasmuch as the 45 page motion includes about 350 pages of exhibits, bookmarks are helpful.

The summary of the motion gets right to the shocking point:

The American criminal justice system is built upon the principle that the government�s interest �is not that it shall win a case, but that justice shall be done.� Berger v. United States, 295 U.S. 78, 88 (1935). The Enron Task Force (the �ETF�)�a team of prosecutors and investigators formed in 2002 to address the public demand for individual accountability in the aftermath of Enron�s collapse�investigated, indicted, and prosecuted Defendant Robert Furst and his co-defendants with the goal to win at all costs. And the ETF �won��Mr. Furst spent almost a year in prison before his conviction was overturned on appeal.

But to secure victory, the ETF engaged in a campaign of misconduct which violated Mr. Furst�s constitutional rights to due process and a fair trial. This misconduct was necessary because the case the ETF indicted and hoped to prosecute, which would involve a sordid tale of a well-organized conspiracy to defraud Enron and its shareholders, was not supported by the facts.

The ETF could not prove that Enron or its shareholders lost any money in the barge transaction, because they did not. The form and mechanics of the transaction were thoroughly vetted through hundreds of hours of negotiation by dozens of highly-competent attorneys. Witnesses interviewed by the ETF undercut its theory of the case. In short, the barge transaction had all the markings of a legitimate business transaction, because it was.

But legitimate business transactions do not generate convictions, and the ETF needed convictions. So, in order to ensure victory, the ETF:

? withheld volumes of exculpatory, case-dispositive evidence which nullified its theory of criminal liability;

? manipulated and misstated exculpatory testimony in pretrial disclosures to make it appear inculpatory;

? silenced witnesses by indiscriminately designating nearly all material witnesses as unindicted co-conspirators; and

? sponsored inculpatory testimony that it knew was false.

The ETF�s conduct did not end with the return of the verdict. After trial, but before sentencing, the ETF received additional case-dispositive, exculpatory evidence from one of the key witnesses in the case. This evidence further nullified the ETF�s theory of criminal liability, and exculpated Mr. Furst.

Rather than disclosing this evidence to the Court, the ETF instead withheld the evidence and brazenly asked this Court to enhance Mr. Furst�s sentence for conduct which was negated by this and other evidence in the ETF�s possession. This misconduct eliminates all faith in the integrity of the jury�s verdict and warrants dismissal of the Indictment.  .   .   .

The mess that is the Nigerian Barge prosecution is a quintessential example of what happens when government is given the leeway to bastardize charges to criminalize a merely questionable business transaction and then appeal to juror resentment against wealthy businesspeople to procure politically popular convictions.

The damage to the defendants, their careers and their families that this abuse of power has caused is bad enough. But the carnage to justice and respect for the rule of law is even more ominous. Does anyone really think that they could stand upright in the winds of such abusive governmental power if that gale turned toward them?

The remaining charges against Messrs. Furst and Brown should be dismissed. Not only for their protection, but for ours, too.

Posted by Tom at 12:01 AM | Comments (0) |

January 14, 2010

Why bother?

After enduring another holiday season of mostly bad college football bowl games, I�ve been thinking about Houston�s own Texas Bowl.

Frankly, why bother with it?

As this recent University of Missouri release notes, Mizzou not only got its collective ass kicked by a feisty Navy team in the game, but the university also lost money in participating in the game even after cutting corners.

That Missouri lost money is not surprising given that the Texas Bowl�s payout is among the most paltry of any of college football�s post-season bowl games.

The Texas Bowl pays out a total of $1.250 million, which puts the bowl game in the bottom third among the 34 bowl games in terms of payout (�Tier 3� in bowl genre). That compares to the $2.2 million and $3 million payouts that Tier 2 bowls such as the Alamo and Cotton Bowls pay to its participants and the $17 million that each of the BCS Bowl games pays to its participants.

Due to its limited payout, the Texas Bowl has no negotiating leverage in attempting to persuade conferences to send one of their better teams. Accordingly, they usually get the sixth or seventh best team from one of the major conferences.

Houston�s bowl game has always struggled for funding. Even back during the days of the Astro-Bluebonnet Bowl in the Astrodome, the folks running the bowl game have never been able to snare the big-fish title sponsor necessary to elevate the bowl�s stature. The Houston Open golf tournament found itself in a similar position for years until it persuaded Shell to become the tournament�s title sponsor. Despite a few blips, the Shell Houston Open has become a solid second tier tournament on the PGA Tour schedule.

What�s too bad about the Texas Bowl�s problems is that it really could be a good bowl experience, at least on par with San Antonio�s Alamo Bowl or Dallas� Cotton Bowl.

My old friend Dan McCarney, who currently is one of Urban Meyer�s top assistants at Florida, coached Iowa State in the Texas Bowl several years ago. He said that the Reliant Park facilities were as good as any bowl game that he had ever seen � the teams used one locker room the entire week for their practices and the game. The teams loved not having to practice at a different site and then move to the stadium on gameday.

Moreover, the Houston business community routinely buys large blocks of tickets to the game (even if most of those tickets go unused). Finally, with the Johnson Space Center, the Medical Center, the Museum District, the Theater District and many fine restaurants and clubs, Houston certainly fits the bill of a place that would be a fun destination for a bowl game.

But what�s the purpose of promoting a bowl game that has mostly second-rate participants who view the game as a booby prize?

If the Texas Bowl can�t find a title sponsor that would elevate the game at least to the second tier of bowl games, then it�s time to pack it in.

There is nothing wrong with declining to waste time on being an afterthought. 

Update: Kevin Whited passes along this Chronicle article from several years ago on Houston�s bowl history.

Posted by Tom at 12:01 AM | Comments (0) |

January 13, 2010

Game, Set, Match -- Houston

O.K., so the Cowboys are doing alright so far in this season�s NFL playoffs and the Texans, as usual, are in their annual �wait until next season� mode.

But there are other areas in which Houston simply throttles Dallas, hands down.

For example, in connection with its mandate to promote Houston, the Greater Houston Convention and Visitor�s Bureau released the video below late last year. Featuring the edgy local band The TonTons, the video does a very nice job of providing an attractive introduction to Houston:

But I didn�t realize just how good the GHCVB�s video was until I came across the abominable video below that the City of Dallas recently produced for the Professional Convention Management Association:

Key tip to Dallas � you are trying way too hard.

Posted by Tom at 12:01 AM | Comments (2) |

January 12, 2010

Girl from the North Country

From the Johnny Cash Show of May 1, 1969, Bob Dylan and Johnny Cash.

Posted by Tom at 12:01 AM | Comments (0) |

January 11, 2010

2009 Weekly local football review

(Previous weekly reviews for this season are here).

Alabama 37 Texas Longhorns 21

Unless you have been living under a rock, you already know that the Horns (13-1) lost the national championship game to Alabama (14-0) after losing star QB Colt McCoy to what looked like a severe pinched nerve in the first five minutes of the game.

It�s really a shame McCoy wasn�t able to play because, as I thought going into the game, the Tide looked as if it could have been had. The Horns could only parley two turnovers in Bama�s first two possessions into six points and, frankly, neither backup QB Garrett Gilbert nor the Horns� coaching staff was ready when Gilbert was called upon to play in the first half (Gilbert had on thrown .

As a result, the second quarter was a disaster for the Horns, as Bama used short fields to ring up 17 points and then punctuated its dominance with a gift defensive TD off of an ill-advised shovel pass on the last play of the first half.

The Horns staff and Gilbert re-grouped at halftime and gamely made a game of it in the second half, pulling to within three with six minutes left to go using a well-designed short passing offense that did not give Bama�s ubiquitous blitz packages time to confuse and pummel Gilbert. 

But forced to take risks late in the game to get back in scoring position, the Horns coughed up the ball a couple of times in the closing minutes to give Bama a two cheap, but clinching, TD�s.

The disappointing finish detracted from an another otherwise successful season for the Horns. Moreover, the future is bright. Although Texas loses such stars as QB McCoy, WR Jordan Shipley and Safety Earl Thomas, Garrett and several other young Longhorns look to be ready to step up so that there will not be a big drop-off in performance next season. In particular, the defense this season became the dominant unit that has been the missing element of consistent national championship contention during Mack Brown�s tenure.

However, not all is well in the Longhorn Nation. Stated simply, this season has established with certainty that Texas has lost the capacity to pound the rock.

With increasing reliance on the spread offense, the Horns no long have an effective power running game that they can turn to when defenses put 7 and 8 players in coverage and allow their safeties to forget about run support. That deficiency was painfully apparent in the Horns� three biggest games this season, this one, the OU game, and the Big 12 Championship game that they should have lost to Nebraska.

There are many reasons for the demise of UT�s rushing attack, but the primary cause has been a steep decline in the performance of the offensive line. Although Texas routinely has its pick of the litter of Texas high school football prospects, offensive linemen are notoriously difficult to project from high school to big-time college football. Thus, sound development in that particular area is essential to a well-balanced offensive attack. For whatever reason, it appears that UT�s coaching staff is having problems in that key development area.

With the better defenses making it increasingly difficult for spread offenses to throw the ball down the field, Coach Brown is going to have to figure out a way to re-establish a power rushing game or the Horns are at high risk of falling off from the top tier of big-time college football (see LSU). It�s going to be difficult at first and there are going to be some hiccups along the way. But the chances of the Horns returning to the BCS National Championship game in the near future are far higher with a balanced offense than the current version.

Posted by Tom at 12:01 AM | Comments (1) |

January 10, 2010

Homer Simpson’s Top Ten List

Posted by Tom at 12:01 AM | Comments (0) |

January 9, 2010

John Oliver visits Las Vegas

The Daily Show's crack British correspondent, John Oliver, tells Jimmy Fallon about his first visit to Las Vegas and his first time shooting a rifle. And below that is an hilarious and surprisingly insightful recent report by Oliver from The Daily Show. Enjoy.

The Daily Show With Jon Stewart	Mon - Thurs 11p / 10c
Even Better Than the Real Thing
www.thedailyshow.com
Daily Show Full Episodes Political Humor Health Care Crisis

Posted by Tom at 12:00 AM | Comments (2) |

January 8, 2010

A better kind of security theater

The Reason.tv video below puts the Transportation Security Administration's silly security theater policies in perspective, while Bruce Schneier provides another excellent post on the kind of security (including some security theater) that makes much more sense.

Is anyone in Washington, D.C. even listening?

Posted by Tom at 12:01 AM | Comments (0) |

January 7, 2010

What killed F.D.R.?

This interesting Lawrence Altman/NY Times article examines the theory that that an undiagnosed melanoma contributed to the death of President Franklin Delano Roosevent in 1945.

Of course, regular readers of this blog know that another killer disease -- the dire implications of which were not well-known in 1945 -- was probably the main cause of FDR's death.

But despite the historical curiosity, the most important point to glean from FDR's demise is the importance of continued investment in clinical and scientific research.

We sometimes forget that it was the generation of doctors and researchers who came of age after World War II who embraced the optimistic view of therapeutic intervention in the practice of medicine, which was a fundamental change from the sense of therapeutic powerlessness that was taught to these men by their pre-WWII professors. In short, it has not been that long since medical science has understood that it could cure disease and prolong life.

For example, if FDR's doctors had known in 1945 what specialists in hypertension discovered in the two following decades, then those doctors would never have allowed FDR to be subjected to the stress of the Yalta Conference that doomed Eastern Europe to almost 50 years of totalitarianism and economic deprivation.

Stated simply, earlier discovery of the research into the implications of hypertension could well have changed the course of human history.

In fact, we all tend to under-appreciate the advancements in medicine since World War II. For male babies born in the U.S. in 1960, the life expectancy was about 66.5 years and for female babies a tad over 73 years. By 2005, the live expectancies had increased to over 75 and 80 years respectively. Although medical advances don't account for all of those gains, newly-discovered drugs and medical devices -- as well as enhanced understanding of disease -- have had an enormous impact on improving the quality of life of most Americans.

Thus, as Congress considers reforming the U.S. health care finance system, it is important for citizens to understand that American medical care and research remains the hope of the world. The current health care finance system has generated enormous investment in that medical innovation, which has been a crucial and treasured export of America to the rest of the world.

Let's think hard before radically changing a system that generated the investment that produced those benefits for us and the rest of the world.

Posted by Tom at 12:01 AM | Comments (1) |

January 6, 2010

Why do these guys write about football?

As if on cue, Houston Chronicle sportswriters Richard Justice and John McClain are all jolly about the Texans first winning season and Texans owner Bob McNair's decision to retain head coach Gary Kubiak for at least another season.

Of course, Justice is utterly oblivious to the fact that he was calling for McNair to fire Kubiak a little over a month ago. Does he not read his own posts?

Both Justice and McClain change their view of the Texans based on the vagaries of each game rather than any meaningful analysis of the team's personnel and management relative to their competition. Apparently, that latter task takes to much work.

Just another of the increasing number of reasons to ignore the Chronicle and rely on the far superior analysis on the Texans that bloggers such as such as Stepanie Stradley, Lance Zerlein and Alan Burge provide.

Posted by Tom at 12:01 AM | Comments (0) |

January 5, 2010

Understanding Adoption

One of the most discouraging aspects of the societal tide of resentment and scapegoating that has permeated the corporate criminal prosecutions since the demise of Enron has been the utter lack of perspective regarding the horrendous human cost of those prosecutions.

Even the horrendous financial cost of those prosecutions seems easier to confront.

A stark example of the human cost is what happened to Ken Lay's family, who endured the decline of a loving father and grandfather as he defended himself against dubious charges that in a less-heated climate would likely never have been pursued.

Equally barbaric is the reprehensible 24-year prison sentence assessed to former Enron CEO Jeff Skilling, whose family has been deprived of their father for over three years now and is threatened to be without him for most of the rest of his life.

But the family that arguably paid the steepest cost from the wave of unjust corporate prosecutions was the family of Jamie Olis, the former mid-level Dynegy executive who was thrown to the prosecutorial wolves by his employer and then sentenced to a ludicrously excessive 24 plus-year prison term for his involvement in a structured finance transaction for which he profited not one dime.

The Fifth Circuit Court of Appeals ultimately threw out that sentence, which resulted in a still-too-harsh six-year re-sentencing. Olis was finally paroled last year and reunited with his wife and young daughter, who literally grew up visiting her father in prison.

But even in the face of such inhumanity, the human spirit perseveres.

Throughout the Olis family's ordeal, Jamie's father -- Bill Olis -- stood out as a rock of stability and common sense.

Whether it was attending the myriad of hearings in Jamie's case in Houston, or escorting Jamie's wife and daughter the hundreds of miles to visit Jamie in far-off prisons, or lending moral support to other families who were enduring similar injustices, Bill Olis projected a sense of calm perspective that was contagious to all who came in contact with him.

He had much to be bitter about in regard to what the federal government did to his son and family, but Bill Olis never gave in to bitterness. He was a quintessential Christian gentleman and nothing that the government did to his family could change that.

Throughout his son's darkest times, Bill remained confident that he and his family would ultimately be reunited with Jamie. Yeah, the government is powerful, but no earthly force was going to destroy Bill Olis' family.

As a result, Ellen Podgor of the White Collar Crime Prof Blog re-named her "Collar for the Best Parent Award" to the "Bill Olis Best Parent Award" because -- in the category of a parent supporting an imprisoned child -- "no one comes close to Bill Olis."

What was not well known through all of this was that Bill Olis was slowly fading away physically during his son's imprisonment. Bill had an oxygen unit with him almost constantly as he tended to his family's needs throughout their ordeal. No big deal for Bill. Mere failing health was not going to stop Bill Olis from being present when his son was released from prison last year. He was there embracing Jamie with the rest of the family, oxygen tank and all.

With the work of reuniting his son with his family done, Bill Olis died over this past weekend. I understand from a family friend that Jamie was able to spend most of Bill's final two weeks with him, which I know Bill enjoyed immensely. He adored his son.

The Olis family story is a remarkable one and frankly far more interesting than the government's dishonest case against Jamie. Years ago, Bill Olis married a single Korean mother and adopted her young son. He provided his wife and son a stable and loving home, and the family flourished. His son excelled in school, obtained advanced degrees in both business and law, and embarked upon a successful career in corporate finance. And when the government targeted the son as a sacrificial lamb for the anti-business mob, Bill Olis spent his last days in this world supporting his son every step of the way and making sure that he returned to his wife and daughter.

Then he passed away.

A Christian minister friend once observed to me that a good way to embrace what is good about the Christian spirit is through understanding the nature of adoption.

Bill Olis was living proof of the truth of that observation.

Posted by Tom at 12:01 AM | Comments (0) |

January 4, 2010

2009 Weekly local football review

(AP Photo/Dave Einsel; previous weekly reviews for this season are here).

Texans 34 Patriots 27

The Texans (9-7) finished off their eighth season in grand style by beating the mostly-trying Patriots (10-6) with an impressive 21 point 4th quarter comeback.

The win wasn't enough to propel the Texans into the playoffs, but it was enough to give the franchise it's first winning record. In Texansland, that's a major accomplishment.

There was much to like about the Texans' performance in this game. WR Jacoby Jones showed heretofore unexhibited resilience by making several key plays down the stretch after muffing a pass that was returned by the Patriots for a TD. The Texans' defense forced the interception that set up the go ahead TD by applying pressure on Brady and scored another TD on a Patriots' fumble in the end zone after the Texans offense failed to score in close. The Texans' nascent rushing attack again looked good as previously fourth-team RB Arian Foster reeled off 120 yds on 20 carries and 2 TD's. And QB Matt Schaub completed his first injury-free season in three seasons with the Texans by emerging as one of the most productive passers in the NFL.

Texans' owner Bob McNair will almost certainly retain head coach Gary Kubiak, although he is the only coach in the NFL who has not made the playoffs or been fired during the four seasons he has served as head coach of the Texans. Nevertheless, the Texans have steadily improved under Kubiak and the players clearly play hard for him, as Sunday's 21-point comeback reflected.

Moreover, McNair is unlikely to break the bank to hire one of the "free agent" coaches in waiting, particularly given the uncertain nature of the stalled collective bargaining negotiations between the NFL owners and the NFL Players Association.

So, expect more of the same from the Texans. Although major improvement is unlikely in 2010, improvement on the level of what occurred between last season and this one would likely propel the Texans into the AFC playoffs. At this juncture, that seems reasonably likely to occur.

But a suggestion for Coach Kubiak -- bring in a few more placekickers for training camp next season.

Air Force 47 Houston Cougars 20

The Air Force (8-5) version of Paul Johnson's triple-option offense ground Houston (10-4) into the turf at the Bell Helicopter Armed Services Bowl at Ft. Worth on New Year's Eve afternoon, while the Falcons' defense harassed Cougars QB Case Keenum into an uncharacteristic 6 interceptions (Keenum only had 9 interceptions against 42 TD's in 450 attempts coming into the game).

That, plus the damp mid-30's temperature and windy weather, was enough to make this bowl experience a particularly forgettable one for the Cougars.

However, I can't really blame the Cougars for their uninspired play. They were at a psychological disadvantage playing in the same bowl game against the same team that it had beaten in last year's game. That Houston had to do so is a travesty of the current bowl system and the inequitable current demarcation between the BCS and non-BCS conferences in big-time college football.

The Cougars were one of the best non-BCS conference teams in the country this past season. They beat three BCS conference teams, two of which (Texas Tech and Oklahoma State) went on to play in more prestigious bowls than the Cougars despite not having as good a record. Given Conference USA's anemic bowl alliances, even had the Cougars won the conference championship game, the best they could have hoped for was a trip to Memphis to play in the Liberty Bowl.

No offense to either Memphis or Ft. Worth, but no one ever mistook them for Pasadena, Miami, New Orleans, Phoenix or even San Antonio during college football bowl season.

So, UH is clearly at a crossroads. Head Coach Kevin Sumlin, his coaching staff, Keenum, and most of the offensive and defensive personnel return next season. Moreover, another solid recruiting class is on deck that emphasizes the defensive players that the previous coaching staff ignored. Accordingly, the Cougars appear on course for another stellar season in 2010.

But Houston clearly aspires for success in a BCS Conference membership, not the outback of a non-BCS conference such as Conference USA. Such a membership will require a major financial investment in upgrading or rebuilding the UH football stadium, plus securing Sumlin and his coaching staff with BCS conference-level compensation.

The University of Houston has received the lowest amount of financial subsidy from the state of any major university in Texas, so UH cannot expect much funding help from the state in its effort to move into a BCS conference. Will the Houston community and UH alumni pitch in what it will take to make the Cougars an attractive candidate for a BCS conference membership?

We will soon find out.

Georgia 44 Texas Aggies 20

The Bulldogs (8-5) broke open a close game early in the fourth quarter and cruised to an easy victory over the Aggies (6-7) in Shreveport's Independence Bowl last week.

The game was basically a replay of many of the Aggies' losses this past season. The offense was generally productive, but was forced into taking too many risks by the Aggies' porous defense and poor special teams play. Thus, even though the Aggies had a sizable advantage in total offense, Georgia controlled the ball and the second half with over a hundred more yards rushing than the Aggies.

As with UH, the Aggies find themselves at a crossroads leading into next season. The potent offensive personnel returns virtually intact next season, but young and mostly horrible defense loses both its best player (DE Von Miller) and its coordinator, the retiring Joe Kines. The Aggies are lining up another solid recruiting class, but it will mean very little unless head coach Mike Sherman hires a new defensive coordinator who can generate rapid improvement in the defensive unit.

As a result, Sherman's decision on a new defensive coordinator is very likely to make or break his tenure as head coach of the Aggies.

I have no idea who Sherman is considering as candidates for the Aggies defensive coordinator position. But if I were in his shoes, I'd take a look at hard look at Air Force's Tim DeRuyter, whose Air Force unit was one of the top defenses in the nation this past season and was magnificent in the Falcons' bowl victory over Houston.

Posted by Tom at 12:01 AM | Comments (0) |

January 3, 2010

Is it time for hoops yet?

After all the mediocre bowl games over the past several days, it's time to turn to the basketball season. A good way to start is with one of the best hoops scenes in the history of cinema, Jimmy's winning shot from Hoosiers. Enjoy.

Posted by Tom at 12:00 AM | Comments (0) |

January 2, 2010

The Duke

A good way to start the new year -- Duke Ellington and Take the "A" Train.

Posted by Tom at 12:01 AM | Comments (0) |

January 1, 2010

The Dude abides in academia

Somehow, it's comforting to know as we move into 2010 that analysis of The Big Lebowski has moved into academic circles.

Of course, these emerging academic treatments have a ways to go before they can rival Rob Ager's work on the film, the first installment of which can be viewed here.

Meanwhile, if you don't mind some pretty salty language, enjoy the clip below of the Dude and his friends discussing what to do about his rug.

Happy New Year!

Posted by Tom at 12:01 AM | Comments (0) |