This Week in Ridiculous Regulations

Happy MLK Day, everyone. The Trump administration’s final full week was an eventful one. The president was impeached for a second time. The usual end-of-administration midnight rush resulted in 118 new regulations and 3,135 Federal Register pages. These are both roughly double the usual pace. The Trump administration’s final Federal Register will be published on Wednesday. Agencies issued new rules, ranging from airplane baggage to pecan promotion.

On to the data:

  • Agencies issued 118 final regulations last week, after 52 the previous week.
  • That’s the equivalent of a new regulation every one hour and 25 minutes.
  • With 170 final regulations so far in 2021, agencies are on pace to issue 4,250 final regulations this year. 2020’s total was 3,353 final regulations.
  • Agencies issued 50 proposed regulations in the Federal Register last week, after 24 the previous week.
  • With 74 proposed regulations so far in 2021, agencies are on pace to issue 1,850 proposed regulations this year. 2020’s total was 2,149 proposed regulations.
  • Agencies published 558 notices last week, after 403 notices the previous week.
  • With 961 notices so far in 2021, agencies are on pace to issue 24,025 notices this year. 2020’s total was 22,480.
  • Last week, 3,135 new pages were added to the Federal Register in a three-day week, after 1,733 pages the previous week.
  • With 4,873 pages so far, the 2021 Federal Register is on pace for119,575 pages in 2021. The 2020 total was 87,352 pages. The all-time record adjusted page count (subtracting skips, jumps, and blank pages) is 96,994, set in 2016.
  • Rules are called “economically significant” if they have costs of $100 million or more in a given year. There are two such rules so far in 2021. Agencies published five economically significant rules in 2020, and four in 2019.
  • The running cost tally for 2021’s economically significant rules ranges from $80.3 million to $293.5 million. The 2020 figure ranges from net savings of between $2.04 billion and $5.69 billion, mostly from estimated savings on federal spending. The exact numbers depend on discount rates and other assumptions.
  • Agencies have published five final rules meeting the broader definition of “significant” in 2020, with three in the last week. 2020’s total was 79 significant final rules.
  • In 2021, seven new rules affect small businesses. One is classified as significant. 2020’s totals were 668 rules affecting small businesses, 26 of them significant.

Highlights from last week’s new regulations:

For more data, see Ten Thousand Commandments and follow @10KC and @RegoftheDay on Twitter.

Book Review: Bill Bryson – The Body: A Guide for Occupants

Bill Bryson – The Body: A Guide for Occupants

A fun tour of the human body and all its combined miracles and foibles. As with A Short History of Nearly Everything, depth is sacrificed almost entirely to breadth. There is a sensationalist undertone throughout, especially in parts involving cancer, obesity, and growing resistance to antibiotics. Bryson lets his sense of humor shine quite a bit, adding some charm to what can be a dreary subject. This is good for novices or people who want a lighter touch on a complicated and intimidating subject. Experts will likely shake their head at Bryson’s frequent overhyping of scary but low-probability events and health conditions.

Book Review: Marc Levinson – The Great A&P and the Struggle for Small Business in America

Marc Levinson – The Great A&P and the Struggle for Small Business in America

This is an excellent history that is playing out again in today’s antitrust revival. A&P was the first nationwide grocery store chain. Though it barely exists today, in its prime it was the nation’s largest retailer. A&P inspired fear among its competitors and outrage among populists.

People made many of the same arguments against A&P in the popular press and in antitrust cases that people make today against Walmart, Amazon, and other big companies. The word choices, hyperbole, and breathless tone are almost identical. And yet, A&P was no match for consumer preferences, which eventually shifted elsewhere. The company chose not to adapt, and today exists on roughly the same scale as Blockbuster Video, which is down to a single store in Oregon.

Some of the very same charges, such as A&P’s selling self-branded products at lower prices than outside brands, are being revived today against Amazon. A&P-era arguments are even being repurposed to argue against Apple and Google’s app stores and search results. Not only were their business practices never anti-competitive, they clearly weren’t enough to save A&P from the competitive process. Nor will it be enough to save today’s big tech companies. Consumers are harsh sovereigns, and as soon as someone does it better, they’ll move on.

History does not repeat itself, but it often rhymes. Levinson digs up some of the lost stanzas of a poem being rebooted all over Washington today. There are lots of lessons here for people on both sides of the antitrust revival.

Federal Minimum Wage Hike to $15 an Hour Will Hurt Small Businesses, Lead to Lost Jobs

This news release was originally posted at cei.org.

President-elect Joe Biden today announced a $1.9 trillion COVID-19 recovery plan that includes not only $1,400 stimulus checks to many Americans but a federal minimum wage hike to “at least $15 an hour.” CEI economic and labor policy experts warned against the real-world impact that new mandate would have on businesses and jobs.

Ryan Young, Competitive Enterprise Institute senior fellow:

“Adding a $15 per hour minimum wage to the next COVID-19 relief bill would be a mistake because the timing is terrible and the tradeoffs are not worth it. Small businesses often have a hard time making payroll as it is, with bills and rent still piling up amid COVID-related slowdowns. A higher minimum wage would do no good for the workers who would be let go because of it.

“A $15 minimum wage would also give big businesses an unfair advantage. Many big companies such as Amazon, Target, and Costco already have $15 minimum wages for their employees. Other big companies can afford to automate some jobs and have the cash reserves to absorb extra payroll for the rest. Smaller competitors might not be able to keep up, especially during hard times like right now.”

Sean Higgins, Competitive Enterprise Institute research fellow:

“Ironically, it was only a few years ago that Neera Tanden, President-elect Joe Biden’s pick to be the next director of the Office of Management and Budget, was warning Democrats against a $15 minimum wage. Tanden, speaking as president of the Center for American Progress, told Hillary Clinton’s campaign in an April 15, 2015 email, ‘Substantively, we have not supported $15—you will get a fair number of liberal economists who will say it will lose jobs.’

“Tanden was right back then: setting the federal wage that high will result in employers cutting back in hiring and limiting workers’ hours to adjust to the higher labor costs. Ultimately, the workers will see little benefit. Consumers, on the other hand, will see higher prices across the board as companies turn to higher prices for their goods and services.”

Book Review: Marc J. Seifer – Wizard: The Life and Times of Nikola Tesla: Biography of a Genius

Marc J. Seifer – Wizard: The Life and Times of Nikola Tesla: Biography of a Genius

Seifer more than once goes into Freudian analysis of Tesla’s personality. I’m going to go ahead and guess that he is not a particularly rigorous biographer. I probably should have chosen a different volume, but this one was on sale. Seifer’s cringy Freudianism is enough to automatically make suspect his conjectures about Tesla’s more out-there research on things such as death rays, worldwide wireless transmissions, and his theories about faster-than light transmissions and extraterrestrial life.

These are better seen as products of Tesla’s time, similar to Isaac Newton’s forgotten works on alchemy and mysticism. In Tesla’s time, Einsteinian relativity wasn’t yet universally accepted or understood in the scientific community. Nor was its implication that light is an absolute speed limit well thought out. Reputable scientists were still searching for workarounds, and there was not yet the sheer preponderance of experimental evidence for the cosmic speed limit that we take for granted today.

Tesla’s scientific, business, and personal lives are stories worth telling. So is his rivalry with Edison. Seifer gives plenty of attention to all of these aspects of Tesla. And he is a good storyteller. But his Freudianism and other quirks hard to take him very seriously.

Book Review: Erik Brynjolfsson and Andrew McAfee – The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies

Erik Brynjolfsson and Andrew McAfee – The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies (New York: W.W. Norton, 2014)

This book from two MIT professors is part big-picture history, and art techno-optimism. McAfee is also the author of the excellent 2020 book More from Less, which is better-argued from a public policy perspective.

The opening chapter sets the historical stage. Living standards were poor and stagnant for nearly all of human history, from our birth as a species until about 1750 or so. If you put human well-being on a graph, it runs almost perfectly flat for thousands and thousands of years. Then it spikes sharply upwards starting around 1750-1800, like a hockey stick on its side. This giant wealth explosion is still happening today, and the authors believe it will continue for some time to come. This is one of the biggest changes in human history.

What caused it? Brynjolfsson and McAfee think it was technology. More specifically, it was the steam engine. Even more specifically, it was James Watt’s iteration of the steam engine. Steam power existed as early as ancient Rome, but it was mostly used for amusement purposes, and not industry. That changed in Watt’s lifetime. This was the start of Bynjolfsson and McAfee’s First Machine Age.

The Second Machine Age is the computer revolution. The First Machine Age revolutionized physical power. The Second Machine Age is revolutionizing mental power. Just as Watt’s steam engine took time to influence manufacturing, technological development, government, and culture, so too is the Second Machine Age. It is far enough along where they argue its fundamental difference from the First Machine Age is clear. But it is also early enough where its impact is only beginning to be felt. The future has almost limitless potential—and some tradeoffs.

The larger arc they draw is the right shape, though I don’t know that their need for two separate Machine Ages is much more than a useful gimmick for talking about technology. I would also submit that the true cause of both revolutions goes a level deeper than just technology. Yes, steam engines and computers are necessary for the two machine ages. Necessary, but not sufficient.

They need another ingredient in the mix: culture. Larger cultural values are difficult to quantify, which is why economists and many other social scientists do not use them. They are still significant, even if they are immune to regression analysis and other quantification. Statistically significant? No. Real-world significant? Very.

Culture shifted in the centuries leading up to Watt’s generation. People were gradually becoming a little more open to change, progress, and improvement. It showed in literature, trade patterns, philosophy, and a new prestige for science and its discoverers. That is why a technology that was already around now began to be used more differently—people allowed it, approved of it, and were willing to countenance large fortunes being made from it.

After setting up their two-machine-ages framework, Brynjolfsson and McAfee go on a tour of new and emerging technologies to see where the Second Machine Age might take us. They take a ride in one of Google’s self-driving cars, among other highlights, and draw encouraging pictures of some of the things new technologies could do for people over the next few decades.

One area where they fall short is their discussion of inequality. They are so focused on the mathematical ratio of the differences between rich and poor peoples’ incomes, that they forget to ask how people at the bottom are actually doing. They also focus almost solely on wage income, which is a significant mistake. This leaves out non-wage income such as employer-sponsored insurance, tuition assistance, free meals, company cars, and other perks that do not show up in income data.

More to the point for a book about technology, Brynjolfsson and McAfee should have asked a question similar to one Don Boudreaux likes to ask: would you rather have 1970-quality medical care at 1970 prices, or today’s health care at today’s prices?

Very few people would rather have 1970’s health care, even at its lower price. That means people view themselves as better off with today’s options. Most people would similarly answer related questions about televisions, computers, cars, appliances, and many other products that both rich and poor people consume.

In fact, society today has substantial consumption equality. Most low-income households have cars that drive at the same speeds on the same roads as wealthy people. They watch the same television shows and have similar Internet connections. More tellingly, rich people are not substantially taller or longer-lived than poor people. In the olden days, one could tell nobles and peasants apart at a glance by their height. Children of nobility got enough to eat, while peasant children were often so malnourished that their growth stunted. There were also substantial differences in infant mortality and life expectancy.

While the very wealthy have orders of magnitude more wealth than ordinary people do, they don’t consume very much of it. Nor do they keep it in a Scrooge McDuck-like vault. They invest it, in an unexpected type of income redistribution. When it’s invested, borrowers use that money to buy homes, go to college, and start businesses. The wealth doesn’t just sit there, people make use of it. It is a subjective question how much of this type of wealth is the “right” amount. But this positive use of wealth is something inequality scholars need to account for, and rarely do. In fact, invested wealth is where most of the capital that funds the amazing technologies Brynjolfsson and McAfee discuss in this book comes from.

They make another lapse in quoting a professional trade association for civil engineers in calling for more infrastructure spending. Of course civil engineers want more infrastructure spending, they have a vested interest in it! This is basic public choice theory. While they briefly acknowledge this conflict of interest, they also do not acknowledge the seriousness of the point, or look at data from less self-interested sources.

Their promotion of a Universal Basic Income (UBI) is similarly idealistic. This model, essentially a straight cash grant, is an objectively better system of poverty relief than the current welfare state. A UBI is easier to administer and more flexible for the recipients. A UBI also makes it more difficult for nanny statists to tell the poor what they shall eat, what things they may and may not buy, what types of health care they may receive, or where they shall educate their kids.

The trouble is politics. Again, a little public choice theory would go a long way in this discussion. Replacing the current welfare state with a UBI would be a fantastic tradeoff, both for the poor and for taxpayers. But the way politics works in practice, this would not happen. A UBI would be negotiated in a Congress led by people like Nancy Pelosi and Mitch McConnell, or whoever succeeds them in a few years. Real-world politicians are unlikely to enact a well-functioning UBI, nor will their constituents let them. Public sector unions whose members administer the current system will block any reform they possibly can.

Tis means any politically-possible UBI would be added on top of the current system, preserving the current system’s flaws and minimizing a UBI’s advantages. Unless this problem is addressed, a UBI risks causing more harm than benefit.

Brynjolfsson and McAfee are consistently a little too idealistic. Some of the technologies they explore in this 2014 book turned out to be flops, and others are still materializing. Similarly, they assume that their political reforms will actually work as they intend them to.

They are certainly right about the larger arc of progress and prosperity. And though I take their technological hyper-optimism with a grain of salt, it is also inspiring. Books like this one and by other thinkers such as Kevin Kelly give me confidence that my daughter’s life will be richer, longer, healthier, and frankly, cooler than mine. This is a source of happiness for me, and gives me inspiration to continue my work on improving economic policy and defending liberalism against populists who would tear it down for no good reason.

Economics Can Help Explain Conspiracy Theorists

There is a lot of conspiracy theory garbage floating around. On January 6, it took a violent turn. Five people died in a coup attempt at the U.S. Capitol, over obviously false claims of a stolen election. It is important to understand what causes this behavior in order to prevent future violence, and to prevent a future breakdown of liberal institutions. Over at Fortune, I explain that a little bit of basic price theory can improve our understanding:

If you think of irrationality as a consumer good, much like a car or a television, you can better understand why people sometimes say and do crazy things. Think of it like this: People buy more cars and televisions when they are cheap, and fewer when they are expensive. 

This logic applies to conspiracy theories.

Read the whole thing here. For readers interested in further exploring the economics and evolutionary psychology of conspiracy theories, I recommend Bryan Caplan’s book Myth of the Rational Voter and Michael Shermer’s book The Believing Brain.

Book Review: Arthur C. Clarke – A Fall of Moondust

Arthur C. Clarke – A Fall of Moondust

A good old-fashioned disaster story, set on the moon. A moon rover carrying a group of well-heeled tourists across the Sea of Thirst gets swallowed into a sinkhole. The passengers are unable to radio for help–the regolith (moon soil) blocks their transmissions. They have few provisions, since they were on a short trip. Worse, the heat buildup inside the vehicle, plus a limited oxygen supply, means that help needs to arrive fast. Fortunately, the passengers include a world-famous retired astronaut who was trying to take a low-key trip, among other people with unexpected talents. Some clever scientists back at the base and on Earth are also able to suss out what happened to the missing vehicle, and are able to finagle a dramatic rescue.

The plot is formulaic and the characters are cheesy. But the setting is remarkable, the science is enjoyable—though I don’t think the bits about the moon’s surface hold up very well—and it’s a lot of fun. Not as substantial as Clarke’s usual fare, but if you’re in the mood for something light, one could do worse.

Book Review: Tom Wolfe – The Right Stuff

Tom Wolfe – The Right Stuff

I saw the movie years ago without knowing it was based on a Tom Wolfe book. I’d never previously read any Wolfe, mainly owing to a lack of interest in 1960s counterculture beyond some of the music. This turns out to have been a mistake, at least regarding Wolfe. He was a fantastic writer, if a bit earthy. Much as I love the science and the spirit of discovery that many other writers have emphasized, Wolfe showed that it had a more visceral side. For the test pilots and astronauts, it was a thrill and an adrenaline rush. It took a certain kind of personality to want to fly to the moon and back. That, as much as the mission itself, is Wolfe’s topic, and he explores it about as compellingly as a writer can.

That said, Wolfe spends an inordinate amount of time writing about NASA’s bizarre anal fixation. They put the early astronauts through some bizarre probing tests that didn’t always have much to do with space or gravity, and Wolfe describes them in great detail.

Wolfe also does not shy away from the danger of test pilot culture, and how it influenced the early space program. It was thrilling and it was risky. But there were also funerals, and families. They were part of the story, too. The deaths of Gus Grissom and two other astronauts on the Apollo 1 launch pad were particularly jarring. Their capsule on top of a rocket caught fire, and a poor design to the hatch door left them unable to escape.

In the earlier days of test-piloting experimental aircrafts, pilots’ wives knew what happened every time they heard emergency sirens making their way towards the local Air Force base, which was often. It was a roll of the dice which one of them would receive a phone call, and another roll of the dice whether the news was a close call, or something much worse.

The book and the movie are both excellent. Wolfe especially excels at combining thrill, danger, and risk with levity and tragedy. The space race was multifaceted, and so should be the histories by which we remember it.

Book Review: Thucydides – The Peloponnesian War

Thucydides – The Peloponnesian War

Thucydides wrote the second volume in the unofficial trilogy of great Greek historians. He begins almost exactly where Herodotus’ Histories ends. Having defeated Persia, Athens now finds itself at war with Sparta. This time, Athens would lose. But Thucydides, who participated in the war, does not see it through to the end. No one is quite sure why. Fortunately, Xenophon would later pick up the baton and finish the war and the “trilogy” in his Hellenica.

Where Herodotus is filled with legends, exoticism, and fantastical creatures, Thucydides is more earthbound. The gods are absent, he never leaves the Pelopennese, his prose style is plain, he consciously sticks to the facts, and his organization is meticulously chronological. Each chapter covers exactly one year, and if important events and themes do not respect those boundaries, so be it. The contrast in historiography, or historical method, is as interesting as the actual history itself.

The Peloponnesian War also contains Pericles’ famous funeral oration, which is one of the heights of Greek literature. Many of the other speeches Thucydides recounts also have high literary value. He stands out in his attempt to humanize his opponents and to understand their points of view. Rather than smear Spartans with ad hominems the way many modern political writers do their opponents, Thucydides sought understanding and objectivity. He saw his task as leaving a reliable record, not making the case for his side events.

At the very least, Thucydides assumes good intentions and noble deeds among the enemy he fought and lost to. Thucydides understood that if one is going to lose, better that it be to a noble opponent than to a weak and immoral one. There are lessons here for today’s politicians as well as the crass Internet commenters who egg them on.