Month: March 2011

Felix Salmon wonders why some restaurants don't take reservations:

In theory, a no-reservations policy creates, in economic terms, a huge price hike for the restaurant's customers: The cost of their wasted time and increased inconvenience has to be added to the amount at the bottom of the check. Such a policy should therefore result in less business for the eatery in question. In practice, however, things seem to work the other way: The more that a restaurant makes its customers wait, the more popular it becomes.

If we're not talking about luxury Veblen goods here — and, clearly, we aren't — then what explains this phenomenon?

Part of his answer: "once you've waited an hour and half just to be seated in a restaurant, you're going to be more excited to eat its food".

Vivienne Walt explains:

One crucial error by Western leaders, says [Mustafa Fetouri, director of the M.B.A. program at the Academy of Graduate Studies in Tripoli], has been to downplay Libya's complex web of tribal loyalties, which has helped to keep Gaddafi in power for more than four decades — an impressive achievement, given several assassination attempts and years of Libya being an international pariah under stiff economic sanctions.

Some tribal alliances date back decades to the bloody rebellions against the Italian colonial forces before World War II, and even some tribal leaders who hold grudges against Gaddafi, for having failed to deliver services or cutting them out of certain privileges, rushed to his defense once the antigovernment demonstrations in Benghazi became an armed rebellion. For those people, says Fetouri, "they will die for Gaddafi, because he belongs to their tribe."

Greg Ip ponders them: 

Buttonwood notes that in the past markets have tended to overreact to disasters, whereas in this case, the response may be justified given the prevailing uncertainty. My own observation is that uncertainty is always high in the wake of disasters with little or no precedent.

A classic example would be the 9/11 terrorist attacks.

The cost of destroyed physical capital was quantifiable; what was unknowable was whether more terrorist attacks were coming and how much increased security precautions would disrupt historical business patterns. Relatively tiny events in the wake of 9/11—the anthrax attacks that fall and the sniper attacks around Washington, DC—extracted an economic cost far beyond that related to the initial attacks because no one knew if they were the tip of a much deadlier iceberg.

(Photo: A businessman is reflected on a share prices board as he watches the sharply dropped figure of the Tokyo Stock Exchange in Tokyo on March 15, 2011. Japan's share prices dropped 620.76 points to close at 8999.73 points at the morning session at the Tokyo Stock Exchange, a day after their lowest close in two years following Japan's devastating natural disasters and nuclear emergency. By AFP/Getty Images)

Scott Morgan thinks through the recent raids:

The big problem here seems to be that Montana's medical marijuana law doesn't explicitly authorize dispensaries. Claiming (as some have) that these businesses are perfectly legal under state law isn't exactly accurate, and thus DEA could argue that their actions are consistent with the Attorney General's pledge to intervene only when state laws are violated. …

But let's get one thing straight: DEA intervention is unnecessary and intolerable regardless of whether or not violations of state law are taking place.

DEA is a federal agency and has no business interpreting local laws that they don't even have authority to enforce. States have all the tools they need to address violations of their own laws. It's absurd to even pretend as though DEA is merely assisting in that process, since questions surrounding state law are irrelevant in federal court either way. There exists no logical role for federal enforcement at any stage in the process, the potential for abuse is dramatic, and no recourse exists in the event that a lawful business is targeted erroneously.

The bottom line is that few, if any, among us really understand what constitutes a fair raid under the current federal guidelines.

Nick Kristof's dispatch from Bahrain is a must-read on the botched opportunities of the monarchy, mistakes by the opposition and descent into sectarian Sunni-Shiite darkness. Money quote:

I wrote a few weeks ago about a distinguished plastic surgeon, Sadiq al-Ekri, who had been bludgeoned by security forces. At the time, I couldn’t interview Dr. Ekri because he was unconscious. But I later returned and was able to talk to him, and his story offers a glimpse into Bahrain’s tragedy.

Dr. Ekri is a moderate Shiite who said his best friend is a Sunni. Indeed, Dr. Ekri recently took several weeks off work to escort this friend to Houston for medical treatment. When Bahrain’s security forces attacked protesters, Dr. Ekri tried to help the injured. He said he was trying to rescue a baby abandoned in the melee when police handcuffed him. Even after they knew his identity, he said they clubbed him so hard that they broke his nose. Then, he said, they pulled down his pants and threatened to rape him — all while cursing Shiites.

This sectarian hatred is lethal and contagious. It could seriously destabilize Iraq. Just look at the faces above.

(Photo: Iraqi Shiite Muslims hold up the Bahraini flag and an image of Shiite radical leader Moqtada Sadr as they protest in Sadr City in eastern Baghdad on March 16, 2011, in support of the Shiite protesters in Bahrain and against the violent crackdown by the ruling Sunni Muslim dynasty in the Bahraini capital Manama. By Ali-Al-Saadi/AFP/Getty Images.)

Today on the Dish, Andrew urged the right to give precedence its Oakeshottian tendencies, and backed up Michael Cohen on Afghanistan's bunk PR cycle, and Haley Barbour deviated from the party line. Al Qaeda tried to woo Libya, Max Boot and the rest of the armchair generals got a chubby for war, and Douthat compared US intervention to adopting Libya as a child. Graphic and shocking videos arrived from Bahrain, and Syria heated up.

Conor considered the victims as global neighbors, readers reflected on architecture after the earthquake, the Wikileaks trove held info on Japan's nuclear plants that weren't earthquake-safe, we examined the economics of nuclear power, and Gregg Easterbrook feared an anti-nuclear backlash. Readers explained why the Japanese don't loot, Eamonn Fingleton worried about economic reverberations, and the cold could kill more than the quake. GiveWell advised on the best ways to aid Japan, and Andrew saluted the Japanese workers trying to save the day.

Andrew kept his guard up on Palin's enthusiastic base, Bernstein trailed the GOP death spiral, and Limbaugh led the Tea Party delusion train. Some people abused disability pay, readers called their bluff, Kathy Ruffing explored the limits of means-testing social security, and Ezra Klein kept on Evan Bayh's ass for his performance art on Fox. Victims fought back against their bullies, Balko wanted to shield forensics from bias, and Reihan learned long division from his sister. Avent and Meghan battled over NYC's density, an architect enlightened us on Portland's earthquake prep,  divorce could literally kill you, celebrities tweeted their suicide attempts, and Gilbert Gottfried made tasteless jokes.

Chutzpah watch here, VFYW here, MHB here, FOTD here, Sergio encore here, quotes for the day here and here, and dissents of the day here.

–Z.P.

Scott Lucas says the above video is a "reminder of the demonstrations in Syria yesterday, the largest since the wave of protest began in the Arab world in mid-December." Al Jazeera reports on the "rare" display of dissent today:

Anti-government protesters have taken to the streets of the Syrian capital Damascus for a second day running but their demonstration was quickly quashed by security forces, witnesses said. Around 100 people, mainly relatives of political prisoners, gathered in Marjeh Square on Wednesday calling for the release of their loved ones and an end to emergency laws. …  On Tuesday some 40 to 50 people gathered after midday prayers in the Al Hamidiya area near the city's Umayyad Mosque in a rare show of dissent against Bashar al-Assad's regime. …

A Facebook page in favour of a "Syrian revolution" has amassed about 42,000 fans, promoting demonstrations "in all Syrian cities".

A reader writes:

Your reader's story about two undeserving men receiving Social Security disability sounds like bullshit to me. There is no way anyone could collect a SS disability check if they had a spouse worth millions, as your reader states, unless there was fraud involved. Also, it is very hard to believe that anyone could receive a monthly check in the amount of $2500. I have a friend who lives in New York, and she has Cerebral Palsy. She receives a monthly check of roughly $750.

I have no doubt that there are plenty of people on SS disability who could work. However, let's not kid ourselves into thinking thinking that they are making a small fortune off the system.

Another reader is also "suspicious":

I suspect that even if what your reader saying about the condition of the people and amount of monthly benefits is true, that the people in question had private disability insurance in addition to Social Security.  Social Security Disability just isn't that generous.  There's a Social Security calculator here.  Go play with it. 

You'll see that in order to get a Social Security Disability payment of $2500 a month at age 55, you'll have had to have been making somewhere north of $100k for a substantial length of time – probably the last ten years of your working life.  Which a high school graduate is rather unlikely to make in this society, and even less so in North Carolina, where salaries are lower than say, New York or LA.  If they did, good for them.  But it's implausible.   

(As an example, if you take a person born in 1960, and give him $50,000 a year from 1978 to 1989, $75,000 a year from 1990 to 1999 and then $100,000 a year from 2000 to the present, all, you would agree, amounts *way* above the average for someone with just a high school degree, you'd get $2442 a month in benefits, or just over $29,000 a year in benefits – a substantial amount of money, sure, but a 70% cut in money from pre-disability pay, which most people wouldn't do willingly without some measure of desperation.)

Another:

I'm the disability lawyer who wrote to you recently. Re: your latest reader, who knows "two people right now who are on Social Security disability and could work. Both are overweight men in their mid to late 50s…Both are only high school educated and would have trouble finding a job in eastern NC."

(a) It is not clear to me why your reader objects to disability for somebody with documented health problems, insufficient education to do office work, and no realistic job prospects, especially in competition with much younger workers.

(b) Social Security's rule is that if you can't work on a “on a regular and continuing basis…8 hours a day, for 5 days a week, or an equivalent work schedule,” then you're disabled. I suspect these mens' doctors are better judges than your reader of whether they can work a full 40-hour week on a regular, continuing basis.

(c) The Social Security Act requires Social Security to consider, when deciding disability, "age, education, and work experience" (see here, and scroll down to subsection (d)(2).) To implement this Congressional mandate, Social Security has the following rules:

(i) If your impairments prevent you from doing your own past work, you have no transferable skills or education, and you are limited to "sedentary" work (mostly sitting, about 2 hours/day walking), then you are disabled at age 50.

(ii) If your impairments prevent you from doing your own past work, you have no transferable skills or education, and you are limited to "light" work (mostly standing and walking, but not much lifting), then you're disabled at age 55.

In the Social Security terminology used by the rules, age 55-59 is "advanced age," age 50-54 is "closely approaching advanced age," and "ditto" is "Do."

As your reader describes these men, it appears Social Security has correctly applied the rules. Is your reader willing to pay higher taxes to fund retraining programs, so people like this could do office work? Is your reader willing to pay higher taxes to fund government stimulus, to create jobs people like this might actually be able to get? Does your reader want Social Security benefits means-tested, and is he willing to have that means test applied to himself? If not, then your reader needs to quit complaining about the rules.

A reader builds off our Seattle post:

I was in architecture school in Oregon (M.Arch, University of Oregon, Eugene)  in the mid-1990s, not long after the SF Loma Prieta quake and at the time of the LA Northridge quake.   I clearly remember our Structures professors stressing a few simple facts (it's been 15+ years, so please excuse my relative-layman's paraphrasing):

1) The recent California quakes had had durations of 15-20 seconds, at a level of Richter 6.7-6.9; we had all seen the devastation they caused.

2) The 'recent' (i.e.: the past 3000 years or so) geological record in Oregon and the Pacific NW registered quakes at high 8-to-low-9 magnitudes, sometimes lasting 30 seconds or more.  

3) Long quake durations in loose soils set up the kind of vibrations and rolling harmonic shock waves which can lead to soil liquefaction (where everything holding the buildings up, however sound the buildings themselves may be, turns to soup – try shaking seemingly solid wet sand in a plastic cup).

4) Oregon's seismic codes were quite new, many strengthened or even initiated in response to Loma Prieta.  For most of the development of the state and until well after WWII there had been essentially no seismic codes and buildings were built to the same standards as their eastern counterparts.

5)  If any of us moved to Portland upon graduating (as most did – it was and is a great city), we needed to know that the city had risen on the richest alluvial agricultural soils in the Willamette valley (go figure), and was thus at a risk for soil liquefaction in a sustained quake that would make what happened to the SF Marina District (mostly lowrise housing on similarly loose manmade fill) pale by comparison. 

6) Their practical advice, as I recall it: Live on top of a solid hill or other bedrock, away from the river, in a wood-frame house or in a brand-new steel-framed building, built to Oregon's then-new seismic codes.  This wasn't going to prevent those buildings being effectively destroyed in a serious quake, but might well save our lives for the relative elasticity of wood and steel construction and the more modern code measures taken to prevent actual building collapse.  As one of your earlier commenters noted, the American tradition in seismic engineering, unlike the Japanese, is geared to prevent loss of life but not property loss. 

7) All those incredibly cool old brick loft buildings down along the river and up into the lower parts of NW Portland were built long before WWII with largely unreinforced loadbearing masonry exterior walls and interior framing of timber or reinforced concrete not designed to any seismic standards.  Not the place to be in  a quake.  Retrofits were only just beginning at the time in response to the CA quakes and the new codes, and generally only when mandated by significant renovations.  Even then, given the risk of soil liquefaction, it was debatable how effective such measures would be in a really big quake.

Here in New England, we have quakes (again, a pretty big one in the 18th c.), but they tend to be short, sharp shocks running through bedrock – nowhere near the long-duration rolling killers of the Pacific Rim.  Our codes are also getting to the point of being as responsive as those prevailing in the Northwest, including requiring retrofits to historic buildings when they're renovated.  I don't worry overmuch about an earthquake in Boston, though it has the potential of doing some serious property damage, particularly to loadbearing unreinforced masonry buildings.  At the likely magnitudes and durations here, however, the secondary effects such as water and gas main leaks are more worrisome than direct quake effects.  That's not the case in the Pacific NW, which shares a violent seismic history with the rest of the Pacific Rim.

By the way, those earthquake buttons, if working properly, can be a big help: they're meant to save you from harm from the elevator itself and/or being trapped in it, by getting it to the nearest floor, opening the doors, and shutting the thing down/stopping it in place.  Now, there's not much they can do for the rest of the building, but that's not nothing.

There's little point in living in fear of all this or screaming for instantaneous fixes.  What measures can be taken can only happen gradually, given the staggering costs and competing pressures.  Disasters like the Japan quakes strike with little warning and may come tomorrow or in 300 years, but it does help to be aware that they DO happen, and educated on the best methods to react, as it could save one's life in the moment.

(Photo by Flickr user Ian Sane)

A reader writes:

Hold on, you mean for my own case, I've been paying the maximum into SS for 20 years now, and now you want to whack it because I had the foresight to make additional investments that will provide income in my old age? I think this is dangerous territory and could have negative consequences. Extending retirement age, ok. Maybe a phase out for net assets in the top 1-2 %, ok, but be careful hitting the middle class, that could be zero sum if people figure they might as well spend it now instead of trying to save it. 

I'm more in favor of eliminating the max contribution, making SS tax less regressive.

The question of penalizing thrift by means-testing social security is a serious one (it's why Thatcher rejected it). I'm pathologically thrifty – but that's because I see social security as insurance against poverty in my old age (if I have any), not a guarantee of permanent welfare. If that's your ethic, not getting government support becomes an element of pride, rather than unfairness. But I can see how eliminating the maximum contribution makes sense and would be open to it as an alternative or as an additional element of fiscal realism. Social security is not in as bad a shape as Medicare, so these changes should be a no-brainer in a functioning democracy. Which, of course, the US often isn't. Another writes:

Your support of means testing as currently envisaged for the various government programs is misguided. It will encourage avoidance. If you get your benefits capped if you earn more than $40k/year, people will start to move their assets around so that they don't break that. While this doesn't mean it won't work, I do think it makes it less effective than many people predict.

This goes doubly so for asset testing. If you have a nice house free and clear, it would make a lot of sense to sell it to your kids, rent it from them for a dollar a month, and suddenly you're net worth is down by $300k.