Mobile carrier SMS pricing created the messaging lottery - and WhatsApp won it

If mobile carriers priced MMS/SMS messaging as a dumb pipe data service, there'd be no WhatsApp. But mobile carriers wanted short term revenues, and lack of competition and contract lock-in (inflated switching costs) meant individual carriers could generate enormous margins on simple texting. Network effects and Prisoners Dilemma (game theory) meant that if a significant number of carriers could make money that way many could do it.

Which in turn drove the creation of a data-only messaging service industry, and made WhatsApp the winner of the alt-MMS lottery (feels very late 90s, which ends in tears).

Markets are weird.

I wonder when Facebook's Messaging service will interoperate with WhatsApp's service - and if iMessage would ever play along. I've always assumed Apple used the threat of iMessage Unleashed to keep its mobile partners in line, but that may be less useful now.

Vanguard and Fidelity: When did civilization collapse again?

I must have been asleep when civilization collapsed. Anyone know the date?

I say this because I haven't done much with our mutual funds for a few years -- just tweaked 'em periodically. Most of the purchases have been through my employer -- 401K, ESPP, and so on. 

Recently though I decided to do some realignment and cleanup at Vanguard and Fidelity. The results were ... interesting.

At Fidelity I discovered two of our larger funds were now in some kind of semi-frozen legacy mode. Sometime in the past few years Fidelity switched from managing mutual funds to managing only brokerage funds. Our mutual funds can be sold and we can do exchanges, but I don't think we can buy new shares (or at least it's not obvious). We have to move them into new brokerage accounts -- presumably without a tax event.

I'm sure Fidelity sent us some kind of notification, and I'm sure it was intentionally obscure. Why did they do this? I presume to avoid regulation or increase fees. I'm very sure they didn't do it for our benefit.

Ok, over to Vanguard. I'll see if I can get some olf-fashioned deposit slips ... 

The page you're trying to reach is currently unavailable

Oookaayyy. I better report that ....

... hang....

Hmm, let's see what happens when I try to deposit ...

Ahh, yes. The world financial collapse and the Zero Lower Bound. Vanguard (and Fidelity) don't earn any interest on US Treasuries, so they don't want me to buy any more. The "protection" is to prevent them losing so much money they have to "break the buck" and return less than $1/share.  That's probably what induced the non-reportable bug with deposit slips.

Between them Vanguard and Fidelity manage $3-4 trillion. A trillion isn't what it used to be, but it's still a fair amount of money. Enough money that our family investments are just noise. The megafunds don't work for us any more.

I guess we'll just have to wait for hackers to use our stolen credentials to empty our accounts. At least then we won't have to beg Vanguard and Fidelity for some attention.

Update: 

Thinking about this, I think it's a tiny artifact of the huge wealth concentration of the past thirty years.

When Emily and I first started putting money in mutual funds there was a market of self-managed investors. I'm guessing 5-10% of the population could put non-retirement money into mutual funds and wasn't wealthy enough to hire a full time professional money manager.

Flash forward to 2014. 0.5% of the population now holds most of our wealth -- and they almost all have professional money managers. About 98% is going to have money in home and retirement and cash. The fraction of the population that manages its own non-retirement mutual fund money is very small -- too small to be a market.

Supplement:

It's not the focus of this post, but for reference here's Fidelity's response on their reorg. Their response is not inconsistent with the hypothesis that ending their mutual fund accounts let them raise more fees (trading is a bad way to invest, but a good way to pay fees) and perhaps dodge regulations.

Fidelity started offering brokerage accounts, so customers can trade Fidelity and non-Fidelity mutual funds, stocks/ETFs, precious metals, CDs, and other fixed income products within the same account. In a mutual fund only account you can only trade Fidelity mutual funds.

You will not lose any benefits by moving your assets into a brokerage account, there are no fees to do that. There are also no account maintenance fees for brokerage accounts. Moving your assets in-kind from a mutual fund only account to a brokerage account is not a taxable event. We will continue to keep the cost basis of your positions.

FWIW, we decided to move the Fidelity US Treasury MM funds to a Vanguard Prime MM account -- mostly for sake of simplification and because the Treasury MM accounts look like they won't come back. We'll either move the S&P or liquidate and pay taxes. Overall we're continuing to slowly shift to Vanguard as the (slightly) lesser of the two evils.

21st century market failure: what the rise and fall of Guitar Hero teaches about gamification

My oldest wants to learn to play drums. Learning is difficult for him, and the Smart Music program his school uses is obviously too sophisticated. We need something simpler, something more accessible, more like a game ...

Something like the Guitar Hero music education program I remember from a few years back. Fun, teach the basics, work with our Wii ... perfect!

Ok, I'll just Google that ....

Right.

Guitar Hero is gone. There is nothing like it any more.

Why Guitar Hero died News • News • Eurogamer.net (Feb 2011)

As the dust settles on Activision's decision to put an end to its world-famous peripheral-based music franchise Guitar Hero and the difficult work of sacking those who helped create it begins, one question remains: where did it all go wrong?

Only three years ago Guitar Hero shot through the $1 billion revenue mark – in the US alone.

Now, in what can only be described as a spectacular fall from grace, Guitar Hero is no more. Why? Why did Guitar Hero die?...

... "Guitar Hero was a victim of its success," said Wedbush Securities' Michael Pachter. "The game was incredibly well-conceived, the peripherals were great, and the music offering was deep and broad. All of those factors led to unprecedented success, and each contributed to its demise."

For Pachter, the fact gamers could play new Guitar Hero games with the peripherals they already owned proved to be the killer blow.

"Once people bought the band kit, for example, they didn't feel compelled to upgrade, as the one they bought was high quality and did the job well," he said. "Once people bought a game, they had 60 - 80 songs to master, and few mastered all of the songs offered...

... "There is absolutely nothing Activision nor anyone could have done to save the music genre. We should remember Guitar Hero for what it was, not where it's at now."...

... "It is possible that Guitar Hero will return, but a re-launch would have to be managed on a far smaller scale. Production costs would have to be minimized to enable profits on unit sales in the hundreds of thousands rather than in the millions."

Pachter's conclusion? "The franchise can support sales at the $200 million level annually, so it will still generate profits, but with license fees and manufacturing costs, margins are not that great, and certainly not enough to keep 200 - 250 people employed working on a new version each year."

So to recap - about 5-6 years ago we had a mini-cultural phenom -- a low cost high fun solution for music education. The Wikipedia article on gamification is written in 2010, around the peak of the Guitar Hero story. A few years later and it's all gone - the game, the console, the hardware, everything. In 2014 some replacements may slowly emerge on the iPad, but we're basically starting over again.

What's going on here -- besides our 21st century penchant for rapid cycles of creation, destruction, and recreation?

Maybe the root problem with gamification is that education doesn't have the economics, or the life cycle, of entertainment. Entertainment has visciously short lifecycles with massive floods of money. That can bring great products out quickly, but this amphetamine fueled growth has a cost. The entertainment products wipe out the weaker educational market -- and when Guitar Hero burns out there's nothing left to replace it. The education market has to be slowly grow back -- only to be wiped out again by the next cycle of the entertainment market.

Ultimately, the entertainment bubble is destructive, and the end result is a peculiar form of market failure.

PS. Garage Band is an interesting exception. It was clearly driven by Steve Jobs passion rather than any kind of business logic. It endures as a monument to Jobs, and because Apple doesn't have to put much money into it. It works, it's done, and the Mac platform is far more stable than entertainment-oriented consoles.

See also:

• Technology in Music Education: There are very few blogs on this topic, this was my introduction to the domain. (Google largely failed, that happens often now.) iOS Garage Band has some traction, I'm trying that.
• Music Education 2.0 | Resources and Reflections on Music Education in the Digital Era
• Teaching Music through iPads: last updated 5/2013.
• App.net thread on this blog post: Great comments. Rock Band 3 had similar course to Guitar Hero (same originators) but Harmonix stuck with its customers. Rocksmith is interesting example of an education (not entertainment) product. Garage Band, esp. for iOS, seems to have potential as a teaching platform.

Bad backs: not necessarily hopeless

I set a Crossfit deadlift "PR" (personal record) today.

My best is not a big deal for anyone else. I'm among the weakest of the men; many of the non-competitive women are in a similar range (the competitive women are in a different universe).

The interesting bit, and the reason I put this in a blog post, is that six years ago I was rigging up a back support so I could be driven home on the bottom of a van. I'd had a pretty bad back since a body surfing accident in 1980 [1], but after 30 years it was getting worse. I definitely wasn't doing any deadlifts.

Until then, based on what I'd read and seen in my own patients, I was a therapeutic nihilist. Manage the acute pain, get back to work and activity asap. Nothing much to be done otherwise. By 2008 though, nihilism wasn't looking so good. I could see a bad future.

So I saw a doctor, a burned out dude with an attitude who'd helped create an aggressive evidence-based back therapy program in the Twin Cities. He wasn't the comforting sort, but I kind of like bad attitudes. Worked for me, I did the program, I got better. Five years later I do the stretches before I get out of bed. Every morning, without fail. And I work out ...

I'm now 8 months into crazy Crossfit stuff, which, were I my doctor, I'd say was stupid. Guaranteed to blow that back and put me back where it was. I didn't say I was smart.

I'm just one data point, but Intensive monitored exercise programs can work. Insurance companies should pay for 'em -- mine was a hell of a lot cheaper than surgery (which I never considered, that rarely works for more than 1-2 years except for atypical problems).

Back backs aren't hopeless -- at least not for everyone. 

After the Smart TV debacle: what we really want

Years after everyone else, I reluctantly retired our 25yo SONY Trinitron CRT and it's (free, subsidized) A/D converter box and naively bought a Samsung Smart TV (Wirecutter, you are dead to me.)

The crapware infested box and usability were bad enough, but an app.net thread on intrusive ads overlayed on an Apple TV input brought the full horror home.

My Samsung experience, and the strange death of rabbit ear (OTA, "over the air") media recording in America [1] made me think more about what kind of TV we really want. I think it would be a set of modules like this:

• Plain display with simple speakers, single HDMI input, no tuner, no remote.
• Separate Tuner/DVR and switch control. 4-5 HDMI in, single HDMI out, digital audio and analog audio out, speaker connections, antenna connections.
• Apple TV

I can imagine some permutations, but I think this is the right setup. Given the subsidies that support Smart TV prices [2] the way to build that today is to buy a Smart TV, don't connect it to the network, set the input to HDMI 1 and hide the remote. Then buy something like the (overpriced) $250 Channel Master DVR+ and an Apple TV.

Sure, Samsung could change their Smart TV so an internet connection was essential, but they won't. There aren't enough geek customers to bother with the customer complaints; we will get subsidized by Smart TV's victims.

- fn -

[1] After a 5-7 year hiatus solutions for recording OTA digital broadasts are reemerging -- albeit at $250 price points instead of the $80 one would expect given parts costs. Why is this? I think some mixture of bad patent law, DMCA, and probably illegal conspiracy and price fixing between cable companies and content owners.

[2] Revenue comes from the things that the Smart TV delivers.

Valerie Plame Wilson on the NSA, Keith Alexander, and Edward Snowden

Ten years ago Karl Rove, Richard Armitage and Lewis Libby took revenge on a man who'd exposed some of Bush/Cheney's Iraq lies. Their revenge was to blow the operational cover of his wife, Valerie Plame, a CIA covert agent. Scooter Libby was convicted of lying to investigators and sentenced to prison. Bush commuted his sentence.

Yeah, the Bush/Cheney years were like that.

Today I heard Valerie Plame speaking on the NSA, Keith Alexander ... and Edward Snowden. If you have any doubt that Snowden is a heroic figure in American history you should listen to the speech.

Plame's description of Keith Alexander is particularly memorable -- and chilling. There are always people like Alexander lurking in the shadows of American history, waiting for their main chance. Most miss out, but 2001 was a very good year for Alexander. He is now a terribly powerful man, and a much greater threat to American democracy than Bin Laden ever was.

We're all living in his shadow now, and he's not gone yet.

Why do corporations do lifestyle "wellness" programs?

Even with rather generous tax breaks, wellness programs cost corporations money. So why pay companies like South Africa's Vitality Group to run them?

It's not because they save money on health care expenses. A Rand study of long tenure employees found that over 7 years PepsiCo got 48 cents in savings for every dollar in expenses. Other recent studies have had similar results; better results with older studies may reflect higher smoking rates back in the 80s.

So why do it?

One reason is that current implementations do a great deal of cost shifting from the young and/or healthy to the older and/or sicker. With Vitality programs a low cholesterol healthy slender non-smoker pays less each month for health insurance than the average employee. (A "3000 point" gap -- enough to qualify for @$1000+ yearly insurance cost reductions.)

These programs follow the same logic as a briefly infamous 2005 Walmart healthcare memo. They shift costs to employees with family or personal health risks....

Wellness programs don’t save money | The Incidental Economist

Horwitz, Kelly et al ....Our evidence suggests that savings to employers may come from cost shifting, with the most vulnerable employees—those from lower socioeconomic strata with the most health risks—probably bearing greater costs that in effect subsidize their healthier colleagues. ..

Is that enough of a shift to make wellness programs covertly cost-effective? Or are corporations just being irrational? I suspect a bit of both, but we gotta remember that Walmart memo. At the very least, they shift costs from the blessed to the unblessed.

The Incidental Economist has covered this topic in some detail ...

• The Feel-Good Promise of Wellness Programs - Bloomberg
• Wellness programs aren’t ready for prime time | The Incidental Economist 9/13 - link to white paper on Penn State program
• Wellness programs don’t save money | The Incidental Economist 5/13 - previous studies on
• On wellness programs: Part 1 | The Incidental Economist 9/13 - earlier RAND study
• On wellness programs: Part 2 | The Incidental Economist 9/13

See also

• Hey Republicans: If you want to cut ObamaCare, try wellness programs 11/2012
• Corporate wellness programs: Not quite the cost savers Wonkblog 3/13

Beware fees and interest payments if you use credit card to wire money

Due to a family emergency I had to send money to a relative twice in two months. Each time I used MoneyGram and paid for the transaction with my VISA card.

I'd done that years ago and it worked well, but it's a bad idea now. VISA treats this transaction as a cash advance, and attaches a fee (roughly 5%) and an immediate interest charge (no grace period). Since I never pay fees or interest to credit card companies this was easy to spot on my statement.

I called VISA and, keeping my temper of course, asked if there was anything that could be done. They reversed the fees but kept the smaller interest charge.

If I had a Debit card I could have used that; there are no fees with Debit cards. I may need to get one.

Of course there are alternatives to MoneyGram (PayPal, sigh) but they require a digitally capable recipient. In this case that's not an option.

Update: If your recipient can manage email, app.net's danielgenser recomments https://square.com/cash

How to evaluate a publicly traded corporate employer

There are many articles on how to judge employees, and many on how to manage typical employee interviews. What I don't see are blog posts or articles on how to judge a corporate employer (The "fear economy" may explain that deficit.)

Since I have lived most of my professional life in a what I think of as a representative 21st century publicly traded behemoth, I have some ideas on what one should look for when considering corporate employment. Remember, I'm not talking about Apple, Google, or Facebook -- not the cutting edge PTC. I'm also not writing about a privately held corporation, much less a startup. This is pure PTC.

Recently I took a look at another position in a different behemoth PTC. That led me to quickly write down some of the things I could look for -- though many are difficult to uncover without inside information. (OTOH, large PTCs employ thousands, so odds are there's an insider friend you can interview).

In no particular order and with minimal editing, here's my list for an IT corporation, but most of it applies to any PTC.

Indirect measures

• Bicycle parking/showers
• WiFi and personal device support
• Offices, privacy -> what is the workspace like for developers/analysts?
• Are there places to meet, chat, interact? Is the kitchen/eating area popular and comfortable? 
• Surveillance strategy
• All employee access to email, calendar mobile vs. executive-only
• Exec vs. non-exec privilege and support: do Execs enter expenses? Do they track time? Do they do the same idiotic training programs non-execs do?
• Yammer or equivalent social business use
• Quality of systems for entering time and expenses. Beware SAP.
• Travel expense procedures 
• Investment in corporate IT infrastructure
• Anything but SharePoint
• Is IT outsourced? What is policy for local machine/productivity support?
• Do workers have admin rights on machines
• What kinds of phones and machines? iPads? Macs?
• Any open source contributions
• Standards activity and participation
• Community participation
• Flex time, remote worker, how maximize productivity of distributed teams
• Telepresence implementation (ex: google hangout vs. Cisco telepresence)
• Balance of employee productivity vs. corporate security
• Can employees fast forward through training videos? (tells you a lot)
• Local division/BU autonomy
• Energy, desire to change/improve vs. wish to keep current state
• How people dress
• Employee retention vs. new employee addition
• Employee morale
• How many shakers/disruptors can corporation tolerate?

Direct measures

• profitability
• growth
• value chain health
• customer-centric vs. vision centric
• market: penetration, competition, business lines
• divisional vs. functional -- where is the P&L
• collaboration vs. competition between divisions and product lines
• quality of the leadership -- esp CEO's reports and one level down (which tells you quality of CEO)
• measurement of product metrics and product lifecycle management
• cost management approaches
• travel and travel restrictions, telepresence
• how is responsibility tracked and managed
• technology innovation: mobile strategy, AI strategy
• training and development how innovative? MOOC? 
• recruitment and diversity including age distribution
• accounting methods: how are business units evaluated and measured, how are teams and employees measured
• PTO and holiday
• development methodology (Agile, other ...) approach to quality, defect management, timelines

Silver bear snow scoop: The Net is still good

When we lived in Michigan's Upper Peninsula snow scoops were sold at the local hardware store. Snow scoops is how snow was moved before snow blowers; they're still great for moving snow where blowers don't work. Or aren't wanted.

Our scoop lasted 20 years, but it finally split along a seam. This distressed #3; snow scoops are essential for creating a solid back yard mound for dog and child play. Alas, we couldn't find any in the Twin Cities. Not enough snow I guess.

Once we'd have been stuck, but Google found a supplier - Silver Bear Manufacturing of scenic Atlantic Mine Michigan -- just a bit southwest of Houghton MIchigan -- where they had 105" of snow in 2004. Oops, that was in one month of 2004. Last winter they had 225" of snow. Yeah, about 20 feet.

(That's Lake Superior on either side of this peninsula).

Silver Bear has a charmingly ancient web site. I paid my $78 and the 22" snow scoop showed up a few days later. It's so solid it makes our 20yo scoop look like a child's toy. Of course the bolt holes didn't quite line up -- that's how I knew it was authentic. Nothing a bit of screwdrive hole stretching and hammer banging couldn't fix. This thing is definitely from the UP.

Here it is ready for action. Let it snow.

Android's curious advantage: lawbreaking made easy

Remember when Apple made ads about ripping CDs? iTunes and the iPod made it elegantly easy [1]. The ads were coy but clear -- wink, wink steal that music. Used CD stores made good money loaning out CDs for extraction. This was after Napster launched digital music, but before legal DRM-free tunes crushed CDs.

Now, of course, Apple is again virtuous, and iOS is a hard target. There's still no iOS 7 iPhone 5s jailbreak. Not only is IOS more secure, there's also less interest in iOS jailbreaking. The hacker community has moved to Android. 

With good reason, because Android is oddly easy to jailbreak. Almost as though bypassing DRM were to Google and Samsung's competitive advantage. Which, of course, it is.

That's interesting, albeit unsurprising, but it gets better. Not only does Google keep Android rootable, the Google Play store sells apps that require rooting to work. Wink one.

It gets better still. WiFi Tethering, one of those root-requiring apps, exists only to bypass carrier restrictions on tethering. So Google sells an app that's designed to at least violate contract terms. Wink two.

That shouldn't be a big deal to carriers who charge for data [3], but for 'unlimited data' [4] carriers like Sprint and TMobile it's money out the door. A single LTE connection can support quite a bit of traffic.

Story done? Not quite. There's one more interesting bit. Nobody writes about this [5]. It's a de facto conspiracy -- because we all hate carriers [6]. Wink 3.

I suspect Google will clean up its act soon. With 80% of the retail market this is a good time to go straight. Android will become harder to root, Google will make more money from DRM, and the Play store will stop selling apps that bypass tethering restrictions.

The wild days will become a passing memory. Who remembers now when Apple was rad?

- fn -

[1] iTunes was a LOT simpler in those days.

[2] Really, that is remarkable.

[3] I dislike AT&T as much as the next geek. Go get 'em!

[4] Of course carriers play games here -- data rates can get pretty slow after first few GBs and unlimited data plans have become pretty expensive in the US. So the real advantage is people who are holding on to low cost legacy unlimited plans. I am so jealous of these (mostly) guys -- they have the equivalent of a rent controlled apartment in Manhattan.

[5] Yes, of course there are a zillion articles about how to bypass tethering restrictions. I mean nobody writes about Google/Samsung's business strategy. By contrast when Apple made ripping CDs easy there was a lot of coverage. Fortunately i'm not giving anything away here -- my readership is very small.

[6] Even people who work for them. Ok, maybe we don't hate Ting - notice they don't have unlimited data.

Future Stunned: Earlier reality flux in the post-material world

When I was a child, I read Alvin Toffler's 1970 book Future Shock...

... Toffler argued that society is undergoing an enormous structural change, a revolution from an industrial society to a "super-industrial society". This change overwhelms people. He believed the accelerated rate of technological and social change left people disconnected and suffering from "shattering stress and disorientation"—future shocked...

For Toffler Future Shock came from physical changes, like a store that moved, or disposable lighters. In the 1970s we went from owning things for decades to owning them for months. We were a long way from the world of possessing a photo for seconds.

Toffler is still alive. I wonder what he thinks of Beijing.

Of course Future Shock turned out to be a relatively mild ailment. Even in China, we seem able to adapt to rapid change. Of course one day we may have more trouble; we may yet fall off the exponential curve.

I had a small taste of the latest version of Future Shock when my daughter accidentally downloaded a 1.5 GB movie and ran up a $136 AT&T data charge (which they reversed).

No, I'm not yet that old. The Future Shock didn't come because iOS 7 changed the rules about the location of our movies. Sure it's mildly disorienting that one day they were all on the phone and could be safely viewed, the next they were in the Cloud and could be viewed anywhere -- for a price. Call that Future Ouch.

The shock came because one day there were no iOS cellular settings on my iPhone (picture is from Emily's screen this morning as she still doesn't have the option):

and 12 hours later there are (this is from my phone)...

Over at app.net some people have this option, some don't.  Our current theory is that my family is in the midst of an AT&T/Apple service transition. One or the other or both are newly enabling Video.app movie download to iOS 7 devices. As the feature rolls out, phones quietly gain a new setting - albeit with odd delays.

As a "happy accident" the setting defaults to On, so some AT&T customers are going to run up big data charges during the transition.

This, as you might have guessed, is Future Shock 2013. It's when people with 50 yo brains aren't sure whether they just missed seeing something, or whether it really wasn't there. It's a state of reality flux that used to start around age 80, but is steadily moving downwards. Call it Future Stunned, or less kindly, premature dementia.

It's going to get worse.

Resolution: tighten bike bolts AND the shoe bolts every 2 months

There are a lot of bolts on my bike and they're always yearning to be free. 

Last week it was a brake lever than went from a bit wiggly to all off in two rides. Tonight, during my the last scheduled commute for 2013 [1], my left shoe got locked into the pedal. Bit of a nuisance as I was trying to put that foot down; happily I could glide far enough to put the right shoe down. When I got home I undid the shoe, then took bike and shoe down for surgery.

Turns out a bolt had fallen out, so the shoe couldn't torque the cleat. I'm not quite sure how I wiggled the shoe off the remaining bolt, but the secret to removing a shoe-less cleat is to drop the pedal spring tension. It comes out easily by pliers.

Ok universe, I get it. I need to do something different. I've created a task for April 2014 to tighten bike AND shoe bolts, I'll do that every 8 weeks or so. 

You should too.

[1] In December I go to CrossFit 3/x week because non-slip roads are unpredictable through March. I used to commute year round, but that was pre-kids. 

1973 vs. 2013: Stagflation vs Stagbubbilation

Stagflation was a catchy way to describe the economics of the Vietnam war West:

Stagflation, a portmanteau of stagnation and inflation, is a term used in economics to describe a situation where an inflation rate is high, the economic growth rate slows down, and unemployment remains steadily high.... 

... In the version of Keynesian macroeconomic theory which was dominant between the end of WWII and the late-1970s, inflation and recession were regarded as mutually exclusive, the relationship between the two being described by the Phillips curve....

The end of this period, around the time of the Zero-sum Society [1], is conventionally ascribed to Volcker's US rate increases @1980 that increased unemployment and supposedly controlled inflation. [3]

We don't have stagflation in year 13 of the Forever War and year 16 of the Bubble era. Instead the US has "The Great Stagnation" (Cowen version) or "Secular Stagnation" [2] -- a time of low inflation/deflation, "free money" that's fueling corporate acquisitions and mega-growth, neo-Feudalism, recurrent Bubbles, and, of course, mass disability and the related return of the Basic Income movement. All, I personally believe, arising because our economic structures can't respond quickly enough to the rise of China, India and information technology. We've fallen off the exponential curve [3].

Now the people who have been mostly right over the past five years are saying we need to embrace the Bubble. Another analogy, one I prefer, is to that we can't get out of the whitewater, we have to shoot the rapids.

Which is kind of desperate advice, since there could be a waterfall down this river. It's easy to invent policy alternatives, but hard to imagine how today's democracies can implement them.

- fn -

[1] "... Thurow proposes that the American economy will not solve its most trenchant problems-inflation, slow economic growth, the environment-until the political economy can support, in theory and in practice, the idea that certain members of society will have to bear the brunt of taxation and other government-sponsored economic actions"

[2] Krugman - stagnation "of or relating to a long term of indefinite duration”

[3] Around the time the IT world began.

Lessons from healthcare.gov - we have the wrong Cabinet

This is the The Cabinet of the executive branch of the USA (slashes mine)

• Department of State
• Department of the Treasury
• Department of Defense
• Department of Justice
• Department of the Interior
• Department of Agriculture
• Department of Commerce
• Department of Labor
• Department of Health and Human Services
• Department of Housing and Urban Development
• Department of Transportation
• Department of Energy
• Department of Education
• Department of Veterans Affairs
• Department of Homeland Security
• Environmental Protection Agency
• Office of Management & Budget
• United States Trade Representative
• United States Mission to the United Nations
• Council of Economic Advisers
• Small Business Administration
• Council of Technology and Science Advisors

I'm looking forward to a Challenger-commission style review of what we should learn from healthcare.gov. I doubt we'll get one; I suspect neither party will let it happen.

If a real review happened I'd like them to look at the Cabinet offices. I've slashed the ones that no longer make sense, and added one that would have owned the healthcare.gov debacle.