Perspective on the protests in Turkey

June 18, 2013 by Jordan McGillis

1) Some background on the Turkish regime. Although the Turkish government has cultivated the reputation for being pro-Western, the trend has in fact been one of dwindling freedom. For a decade now, Recep Tayyip Erdogan’s Justice and Development Party—the country’s Islamist party—has been consolidating power. In the most recent national elections, the party garnered over 49% of the vote, the highest percentage any party has earned in more than three decades. Turkey’s GDP has tripled since Erdogan was first elected—and that certainly contributes to his degree of popularity—but the economic gains have been accompanied by an insidious assault on the liberty of Turkish citizens. As I mentioned on this blog earlier this year, Erdogan has been methodically incorporating his party’s Islamic philosophy into the erstwhile secular state. The results have not been pretty, with one of the most noticeable casualties being the freedom of the press, as documented here and here by Human Rights Watch. Considering the character of the regime and developments so far, the protesters against Erdogan’s regime have demonstrated real courage.

2) The myriad protesters in Istanbul, Ankara, and elsewhere in the country have disparate grievances and interests. While it’s encouraging to see the people of Turkey standing up to Erdogan and his Islamist partners, it isn’t at all clear that they have defined objectives. The proximate spark for this spate of protests was actually a dispute between local residents and the government over a construction project. And, to further muddy the waters, environmentalists and leftists have been among the most prominent protesters. Social media, which Erdogan has called a plague, has proven an effective mass communication tool for protesters and gives us a window into what is happening on the ground in Turkey. Due in large part to its rapid dissemination through social media, this story of one Turk’s silent protest has captured global attention. This video revealing the tactics of the Istanbul police force has as well.

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Genetically Modified Monday (#GMOMonday)

June 17, 2013 by Amanda Maxham

TomatoesOn the steps of the Salem, New Jersey, courthouse in 1830, legend has it that a daredevil named Robert Johnson elicited gasps from the crowd when he announced his next trick. Some remarked that he would be dead before morning; others simply watched in horror as he held aloft a small red object.

His stunt? He was about to eat a raw tomato.

Today this stunt would be laughable, but there’s a reason why it would have excited the crowd back then. At that time, people understood that wild plants are frequently dangerous to those who consume them—they are chock full of toxins and allergens that pose a real threat.

People probably still stand on the steps of the New Jersey courthouse and enjoy raw tomatoes, perhaps in a salad. But everything in that salad would be practically unrecognizable to our stone-age counterparts.

The foods we enjoy today are the product of thousands of years of human-influenced changes. Thankfully, they have been radically altered from their natural states; but the journey is not over for them. Up until recently, these improvements were done using the painstaking and relatively imprecise method of selective breeding, grafting and crossbreeding. Now scientists have found ways to improve plant and animal cells on the genetic level. They have searched for and found genes responsible for both desirable and undesirable traits and then unlocked the DNA—adding, eliminating or turning down the expression of these genes.

In researching these genetically modified plants and animals, I was struck by the wide variety of ways scientists have engineered food to solve health problems, improve taste, increase nutrition, alleviate allergies, on and on. From serious to fun, these foods have potential worth talking about.

So, I am excited to unveil “Genetically Modified Monday.” Each Monday, I will write about one of the new genetic improvements to the food we eat. You can chime into the discussion by tweeting, using the hashtag #GMOMonday (“GMO” stands for “genetically modified organism”). What are some of the improved foods you are thinking about or enjoying today?

pixies:into the whiteToday, I’m thinking about golden rice.

Vitamin A deficiency isn’t something we worry about too much in the United States, thanks to plentiful nutritious food. But vitamin A deficiency is a big problem in poor nations. The World Health Organization estimates that between a quarter and a half million children go blind each year for want of vitamin A. Even more unfortunate is that about half of those children will be dead within twelve months.

Many of those children have access to rice, but rice on its own doesn’t supply all of the necessary nutrients for a long and healthy life—one crucial deficiency in rice is a lack of beta carotene. When we eat beta carotene, our bodies convert it into the vitamin A we need. Beta carotene is found naturally in carrots and some other fruits and vegetables, but not in rice. Even though all the required genes to produce beta-carotene are present in rice, some of them are turned off during development of the rice grain itself.

The inventors of golden rice, Ingo Potrykus and Peter Beyer, discovered first that the genetic pathway needed was already inside each grain of rice. Then they figured out how to “turn on” this pathway with the addition of a single borrowed daffodil gene.

The result was golden rice. It is the beta carotene that gives it its characteristic golden color. It can cheaply combat blindness and malnutrition in children in the poorest of nations. Simply plant and eat.

A final note: Curiously, golden rice has sparked major controversy. Do you have concerns about the safety of genetically modified foods? I’ll be writing about the supposed dangers soon. Meanwhile, enjoy #GMOMonday.

(By the way, not to worry: Robert Johnson survived after eating that raw tomato.)

Update: This post’s title and text were updated to change the Twitter hashtag to “GMOMonday” and to clarify that “GMO” stands for “genetically modified organism.”

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The financial threat of antitrust

June 14, 2013 by Tom Bowden

As part of my mission to raise awareness of antitrust’s impact on American business, I thought I’d take a minute to list some of the more significant legal penalties imposed in recent years. They are not chump change:

  • Earlier this year, a jury awarded damages of $400 million against Dow Chemical in a price-fixing case. Pursuant to statute, the judge trebled the damages. Dow is appealing the resulting $1.2 billion judgment.
  • In March, the European Union fined Microsoft $732 million for omitting from Windows a screen that offers users a choice of browsers.
  • Over the past several months, the Department of Justice and state attorneys general have imposed penalties on five publishers totaling $170 million (see also here and here) to settle charges of price-fixing in the e-book market.
  • A Taiwanese company, AU Optronics, was recently fined $500 million after losing at trial to the Department of Justice, which can’t help bragging: “The $500 million fine matches the largest fine imposed against a company for violating the U.S. antitrust laws.”
  • Back in 2009, Intel was hit with a $1.45 billion fine by the European union for “anticompetitive practices.”
  • Oh yes, let’s not forget the $1.1 billion fine levied against Microsoft by the EU in 2008, and upheld on appeal in 2012, for failing to provide competitors with computer programming codes to interface with Microsoft’s server software.

I could go on, but you get the point. Of course, the real issue is whether such penalties are justified as punishments for actual wrongdoing by the businesses affected. I say no (see here, here and here, for example), but even those who disagree cannot deny the magnitude of the threat.

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Calorie display mandates threaten business health

June 13, 2013 by Doug Altner

pizza2My colleague Rituparna Basu recently mentioned another one of the destructive business regulations buried in the Affordable Care Act: the calorie display mandate, which forces all restaurants, bakeries and other food sellers to display the calorie content of their food. This is another restriction on the freedom of businessmen in these sectors, as it bans selling food without also carefully researching its caloric content and prominently displaying the findings on menus.

Providing information that is accurate and complete is not cheap. Sarah Kliff at The Washington Post’s Wonkblog spoke with a representative from the supermarket chain Kroger about this mandate, and here is how she summarizes what the chain must do to comply with it:

… Krogers would need to spend $20 million to come into compliance with the new regulations. And it’s not just about buying poster board and listing calorie counts. It’s about figuring out how many calories each item has to begin with.

She continues, adding that the representative himself elaborated on the wide-ranging impact that this mandate will have for his business:

… We might have thousands of SKUs for birthday cakes and thousands of types of prepared pizza. The problem is it forces us to label all of that, down to the olive bars and salad bars.

Restaurant owners too must bear a significant burden from this mandate. Melissa Cummings, a representative of the nationwide pizza chain Domino’s, estimated that putting calorie counts on menu boards would cost as much as $4,800 a year per store. Problem is, according to Cummings, this cost is 10 percent of Domino’s profits.

If enough consumers truly value knowing the precise number of calories in the items that they order at restaurants, then businessmen have an incentive to find a cost-effective manner to provide such information to consumers. This is why today there are numerous Apps offering detailed calorie information on popular fast food restaurants and why many restaurants advertise low-calorie menu options. If the government did not get involved, businessmen would be free to choose to display information when they calculate that it is in their interest to do so, and they would be free to not display such information when they estimate that it is not worth the cost.

But the calorie display mandate disregards the rights and interests of such businessmen, and instead orders restaurants and supermarkets to bend over backwards to provide detailed caloric information. This is yet another measure in which lawmakers tell businessmen “my wish is your command,” and businessmen are treated as if they have no right to say no.

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Apple’s antitrust trial: a good backgrounder

June 12, 2013 by Tom Bowden

small-Apple-logoRoger Parloff, senior editor for legal affairs at Fortune magazine, has written the best summary I’ve seen of the factual and legal issues in Apple’s antitrust trial, currently underway in Manhattan federal court. Parloff’s explanation goes into some detail but remains accessible to those not familiar with antitrust or the economics of book publishing. He also addresses a number of questions that I’ve been waiting for a journalist to answer, such as how Amazon’s pricing strategy for e-books figures into the case.

From Parloff’s article:

The following basic facts appear to be fairly undisputed. In November 2009, just two months before Steve Jobs made his historic unveiling of the first iPad tablet on January 27, 2010, Apple’s head of content, Eddy Cue, convinced Jobs to give the iPad e-reader functionality and use the opportunity to launch a digital bookstore, comparable to Apple’s already successful iTunes and Apps Store. Jobs greenlighted the project. But while the new iBookstore would launch on April 3, 2010, Jobs wanted the key contracts with publishers signed by the time of his January iPad unveiling, so he could include it in his presentation. (In his opening, Apple lead lawyer Orin Snyder, of Gibson, Dunn & Crutcher, included a video excerpt from Jobs’s masterful iPad launch. While it was a moving and bitter-sweet moment for many of the journalists and business people present, U.S. District Judge Denise Cote, who is hearing the case without a jury, seemed ominously cold during the clip.)

Cue began meeting the CEOs of the six major publishers in mid-December 2009, sent out proposed term sheets in early January, and finally reached signed contracts with five of the publishers over the final three days preceding his January 27 presentation.

Cue knew next to nothing about the book industry when he undertook his task in December, according to Snyder, the attorney for Apple. But one thing everyone knew by then—because it had been the subject of major articles in the Wall Street Journal and New York Times during the summer of 2009—was that the publishing companies were, by this time, furious with Amazon about the rock-bottom $9.99 price at which it was selling the ebook versions of most of their new-releases and New York Times bestsellers.

I’ll be writing about the case from my own perspective soon, but for now, Parloff’s article neatly summarizes the facts as they stood at the trial’s start on June 5. Spoiler alert: In my view, the whole story is an example of creative profit-seeking that unjustly ends in a legal nightmare.

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Altner on Politix.topix.com: Why delivering beer isn’t easy

June 11, 2013 by Doug Altner

I have a new op-ed on Politix.topix.com on the three-tier alcohol distribution regulations, a Prohibition-era system of controls that make it harder for big and small brewers alike to deliver better beer at lower prices.

How absurd is it that in many states a microbrewer is forced to use a third-party distributor to take a few cases of beer to a convenience store down the street from his brewery?

Read the whole thing.

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Why shouldn’t Walmart be free to keep out a union proxy?

June 11, 2013 by Doug Altner

WalmartWalmart has been receiving negative publicity for discouraging employees from supporting the small but vocal activist group OUR Walmart (Organization United for Respect at Walmart)—a union-backed organization that advocates higher wages and more benefits for Walmart associates. Are Walmart managers who do this guilty of any wrongdoing?

It is extremely relevant that OUR Walmart has organized protests to intentionally disrupt Walmart stores, including during Black Friday—one of the largest shopping days of the year. It is also extremely relevant that OUR Walmart is backed by the United Food and Commercial Workers. This group has unsuccessfully tried to unionize Walmart stores for over a decade and is infamous for orchestrating the 2003-04 Southern California supermarket strikes, in which 59,000 employees picketed in front of hundreds of stores urging shoppers to go elsewhere. These strikes lasted 145 days, left shelves understocked with basic staples such as meat, produce, and dairy products, and cost supermarkets $2 billion in sales. The UFCW also nearly launched another 60,000-employee supermarket strike in 2011.

Given the UFCW’s history, why shouldn’t Walmart managers be free to actively discourage employees from supporting a UFCW proxy like OUR Walmart? And why shouldn’t they have the freedom to dismiss employees who actively canvass for this group? Shouldn’t Walmart managers have the freedom to choose their own employees?

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How controls are bred from controls

June 10, 2013 by Doug Altner

ARColumnIn an interesting Forbes.com piece, Competitive Enterprise Institute adjunct scholar Jessica Melugin posits that Amazon.com supported the Marketplace Fairness Act—the bill that forces shoppers to pay a sales tax on online purchases—because they believe that the law will do more damage to their competitors than to them.

Businessmen are often accused of lobbying for government intervention on such grounds. Many commentators on a previous blog post of mine suggested that the Costco CEO expressed support for a higher minimum wage simply because he already pays most of his employees well above minimum wage, whereas many of his competitors do not. Columnist Tim Carney insinuates that Walmart deliberately endorsed forcing all large employers to provide health insurance for full-time employees for similar, “crony” reasons.

It is not always obvious what motivates business leaders to endorse such interventions—I question whether such endorsements are usually calculated, nefarious attempts to cripple competitors. But I think it happens sometimes, and these situations remind me of a rather apt analogy from Ayn Rand on how controls can breed controls.

In a 1962 Los Angeles Times column titled “The Cold Civil War,” Ayn Rand analogized this phenomenon to a runner forced to wear chains during a race:

A man who is tied cannot run a race against men who are free: he must either demand that his bonds be removed or that all the other contestants be tied as well. If men choose the second, the economic race slows down to a walk, then to a stagger, then to a crawl—and then they all collapse at the goal posts of a Very Old Frontier*: the totalitarian state. No one is the winner but the government.

Like the runners in the analogy, today’s business leaders face an alternative. They can challenge the premise that the government should be imposing controls that make it illegal to hire anyone for less than $9 per hour or without providing health insurance. Or they can lobby for more economic controls when they think these interventions will largely injure their competitors, and thereby perpetuate the system in which others can lobby for additional controls on them. What do you think will happen if businessmen keep on choosing the latter?

* Here, Rand was making reference to President John F. Kennedy’s “New Frontier,” a phrase that was commonly used to refer to his policy programs.

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The Arab-Israel Conflict and the Palestinian Refugees [podcast episode #06]

June 7, 2013 by Elan Journo

SIXTY-THREE years ago, a 13-year-old Palestinian boy was forced to leave his home in the Galilean city of Safed and flee with his family to Syria. He took up shelter in a canvas tent provided to all the arriving refugees. Though he and his family wished for decades to return to their home and homeland, they were denied that most basic of human rights. That child’s story, like that of so many other Palestinians, is mine.

So wrote Mahmoud Abbas, leader of the Palestinian Authority, in a 2011 New York Times op-ed. That vignette may seem a strange way to motivate an article—the story of refugees from what’s now 65 years ago?—but for Palestinians and their allies, it remains a live issue. For them, any meaningful discussion of the Arab-Israel conflict must address the fate of refugees. Unless Palestinian refugees are granted their alleged “right of return,” they insist, there can be no peace.

In the intricate, sometimes convoluted history of the Arab-Israel conflict, the “right of return”/refugee issue is just one thread. But it is a particularly revealing one. Explore it, and you can learn a great deal about the nature of the broader conflict and some of the reasons it has come to seem irresolvable.

A terrific resource on the subject is Efraim Karsh’s most recent book, Palestine Betrayed. In the latest episode of the podcast, I interviewed Prof. Karsh about his book.

We cover a lot of historical ground, and listeners keen to understand the Arab-Israel conflict will learn a lot about the backstory of the refugee crisis, what gave rise to it, and how the refugees’ plight has figured in the continuing conflict. We move from that backstory to more recent developments such as the notorious Oslo “peace process,” rolled out in 1993 and memorialized in an iconic photo-op on the White House lawn. That incongruous tableau featured Israeli prime minister Yitzhak Rabin shaking hands with arch terrorist Yasser Arafat, with President Clinton looking on with delight.

Yitzhak Rabin, Bill Clinton, Yasser Arafat, September 13, 1993

One point I found particularly arresting in the interview has to do with that famous handshake and the ennobling of Arafat as some sort of statesman. Many at the time wanted to believe that Arafat, a pioneer of international terrorism, had abandoned the violent goal of subverting Israel and become a peace-maker. To Western audiences—notably at that ceremony on the White House lawn—Arafat portrayed himself a lover of peace. But Prof. Karsh has documented that Arafat was playing a double game. One example: He had pre-recorded a speech, broadcast that same day on Jordanian radio for Palestinian listeners, in which he explains the peace accord as a new, incrementalist tactic serving the same long-held goal that terrorism had served: not to achieve peaceful co-existence, but to conquer and supplant Israel.

A sample of some other illuminating points that come out in the interview:

  • The timeline of key developments from the British Mandate in Palestine to the UN partition plan of 1947, and the ensuing war
  • The improved standard of living and economic development of Palestine following the arrival of Jewish settlers, especially benefiting Arab inhabitants of the area
  • How the invasion by nearby Arab regimes of the nascent Israeli state in the 1947-8 war had little to do with aiding Palestinians—and a lot to do with the regimes’ self-aggrandizing lust for conquest.
  • Why the “right of return”/refugee problem persists, how it is magnified by Arab regimes, and how the “right of return” is understood by some as a means of dissolving the state of Israel.

You can find Prof. Karsh’s book, Palestine Betrayed, on Amazon.com, and a bibliography of his other writings here.

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Leading Obamacare proponents: health law doesn’t improve quality of health care, but so what?

June 6, 2013 by Rituparna Basu

5110246671_8571e142e1_bSome time ago I wrote on this blog that proponents of greater government intrusion in health care are not motivated by improving the quality of health care Americans enjoy. A recent comment from two leading proponents of Obamacare serves as an example of this.

Here’s the background for their comment: One major provision of Obamacare is the expansion of Medicaid, the government’s health care program for low-income individuals, to cover 21 million Americans who were previously ineligible. But a major study, known as the Oregon Health Insurance Experiment, recently suggested that being on Medicaid does not make people any physically healthier than if they are uninsured. Being on Medicaid, according to the study’s authors, “generated no significant improvement in measured physical health outcomes,” such as cholesterol and blood pressure levels.

[Let’s leave aside the validity of the study’s results and assumptions. Your cholesterol and blood pressure levels are obviously affected by many factors other than your means of paying for health care, such as lifestyle choice, family history, etc., so the causal link between coverage and health is dubious.]

In response to commentators who argued that the results of this study suggested Medicaid expansion is a bad idea, Aaron Carroll and Austin Frakt, leading liberal health policy analysts, had this to say: “We have never claimed that quality would go up just because of the ACA [Obamacare]. Access will improve.”

Note that Carroll and Frakt aren’t limiting their evaluation to the Medicaid provision of Obamacare but are speaking of the entire law. That’s 20,000 pages (and counting) of regulations they see as having nothing to do with improving the quality of health care in America today.

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