Why Warren Buffett Is Wrong About Whole Foods

May 4, 2015 at 8:57 pm

Warren Buffett's annual meeting comments criticizing Whole Foods and businesses that employ economists are the topic of my column this week. Please check the column out at the New York Sun (here), Reason (here), and Newsmax (here).

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Walmart Fixes Health Care

May 4, 2015 at 3:42 pm

Atul Gawande has an article in the New Yorker reporting on the lesson from Walmart's experiment with channeling spine, heart, or transplant procedures for employees to six "centers of excellence" — the Cleveland Clinic; the Mayo Clinic; Virginia Mason Medical Center, in Washington; Scott and White Memorial Hospital, in Texas; Geisinger Medical Center, in Pennsylvania; and Mercy Hospital Springfield, in Missouri:

Two years into the program, an unexpected pattern is emerging: the biggest savings and improvements in care are coming from avoiding procedures that shouldn't be done in the first place. Before the participating hospitals operate, their doctors conduct their own evaluation. And, according to Sally Welborn, the senior vice-president for benefits at Walmart, those doctors are finding that around thirty per cent of the spinal procedures that employees were told they needed are inappropriate.

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Wright Brothers Versus Government

May 4, 2015 at 10:09 am

Summing up the story of the Wright Brothers as told by David McCullough in his new book The Wright Brothers, New York Times reviewer Janet Maslin writes: "Relying on their imaginations, inexpensive materials, bicycle-related ideas about steering and modest sums they earned at the shop, they would ultimately embarrass the Smithsonian and its grandiose, government-funded flying experiments that were conducted on (and generally flopped right back into) the Potomac."

What a fascinating angle on the story of the invention of the airplane — that it shows a triumph of private ingenuity over big government.

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Donald Graham on For-Profit Education

May 4, 2015 at 9:59 am

Graham Holdings chairman and CEO Donald Graham, in an op-ed, does a really nice job of pushing back against a Miami Herald series attacking for-profit education. From the op-ed:

reporting on a story that has more than one side, the Herald's reporter wanted to know only one. Every word of his series reeks of this. Every charge — from plaintiffs' attorneys, former employees who were fired (though the Herald's readers were not permitted to know they were discharged) and lifelong critics of the industry — is treated reverently. The few scraps of evidence of another side are treated contemptuously. If a politician doesn't agree with the critics of the industry, it must be because he or she has received a microscopic percentage of his or her campaign contributions from those connected to us...

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Who Put Spitzer on the AIG Case?

May 1, 2015 at 2:42 pm

Toward the bottom of a fine James Stewart column in the New York Times about Maurice "Hank" Greenberg's 90th birthday and his legal battles comes this:

Mr. Spitzer told me this week the claim that the lawsuit was retaliation against Mr. Greenberg "is the most ridiculous assertion I've ever seen." He added, "The case is well documented and was brought to our office by established members of the business establishment."

Now that's interesting. The natural follow-up to Spitzer would be, who were those "established members of the business establishment"? Were they rival insurance companies or AIG's business competitors? Were they money managers who were shorting AIG stock? Mr. Spitzer makes the claim to defend himself from the charge of retaliation, but it's not entirely clear that the scenario he describes is much better than a retaliation scenario.

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Exit to Malta

May 1, 2015 at 2:19 pm

A New York Times dispatch from Malta reports on the high demand for citizenship there:

The tax system, in particular, has been a boon. Some foreign companies can be structured to pay 5 percent in corporate taxes. Malta also has double taxation treaties with 65 countries, allowing individuals and businesses to avoid being taxed in two places.

Significant tax advantages and a pro-business regulator have created a booming financial services industry. It now represents 12 to 15 percent of the country's G.D.P., up from 6.3 percent in 2004. Online gambling companies have flocked to the island, as have hedge funds.

With a strong corporate base, Malta sailed through the economic crisis relatively unscathed. The economy grew 3.5 percent in 2014. Unemployment is 5.8 percent, the fourth-lowest in Europe.

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Business Threatened With Violence

April 29, 2015 at 4:43 pm

A Twitter campaign urged "direct action" against a company, Protein World, whose advertisements were deemed offensive, Breitbart reports. As in Baltimore, the protesters don't help their cause with their own tactics.

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The Floating Kilogram

April 29, 2015 at 4:25 pm

Wall Street Journal editorial board member Mary Kissel interviews the editor of the New York Sun, Seth Lipsky, about his new book of monetary policy editorials, The Floating Kilogram, in the video embedded below

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Spend Less Time on the Internet

April 29, 2015 at 3:50 pm

Life advice from Sam Altman, who just turned 30.

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The GOP in Baltimore

April 29, 2015 at 3:38 pm

After President Obama failed to show up at the Paris "Je Suis Charlie" solidarity march, I suggested that a Republican presidential candidate might take advantage of the opportunity and get on a plane to France. It might risk appearing like ambulance chasing, but it would have made an important point.

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Correction of the Day

April 29, 2015 at 3:04 pm

From the New York Times, in connection with an article covered here the other day:

An article on Friday about Kleiner Perkins, the venture capital firm, which filed for reimbursement in a gender discrimination suit, misstated the fees paid to Paul Gompers, a professor at Harvard Business School who was a witness in the case. It was $131,400, not $92,700.

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Brookline Votes on a Tax Increase

April 28, 2015 at 8:36 am

A ballot referendum on a property tax increase in Brookline, Mass., is the topic of my column this week. Please check it out at Reason (here) and at Newsmax (here).

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The $92,700 Witness

April 24, 2015 at 9:12 am

The venture capital firm Kleiner Perkins is trying to get its former employee Ellen Pao to either agree not to appeal or to pay its expert witness fees after she unsuccessfully sued for sex discrimination. The New York Times reports: "The vast majority of the fees Kleiner is trying to recover are for witnesses. The fees for Paul Gompers, a professor at Harvard Business School, were $92,700, the filing says."

According to the memorandum of costs, in addition to the $92,700 fee to Professor Gompers, there was an additional $140,000 or so in fees to Cornerstone Research for "P. Gompers support," billed at a "50% discount."

Nice work if you can get it. It's not clear how much time Professor Gompers devoted to the case.

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Uber on Martha's Vineyard

April 23, 2015 at 11:36 am

The Vineyard Gazette has an article about the possibility that the ride-sharing app Uber will debut this summer on Martha's Vineyard. It concludes with a quote from the owner of a taxi company, a quote that does a wonderful job of encapsulating how incumbent companies try to use the power of the government to protect them from competition that lowers prices and improves service for consumers:

Mr. Baldwin and Mr. Hickey are looking to local government to keep Uber off the Island.

"It's new, it's trendy, it appeals to the Facebook generation," Mr. Hickey said. "I get that. I'm hoping selectmen will step up, or police will step up to stop it."

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Senator Franken Comcast Time-Warner Letter

April 23, 2015 at 11:27 am

Six senators — Al Franken, Bernard Sanders, Ed Markey, Ron Wyden, Elizabeth Warren, and Richard Blumenthal — have sent a letter to the FCC and the Justice Department asking them to block a proposed acquisition of Time Warner Cable by Comcast.

If some Republican senator sent a letter to the Justice Department on behalf of a campaign contributor asking for a merger or acquisition to be approved, doubtless it would be considered a scandalous interference. Even Democrats like Senator Menendez and Terry McAuliffe, Harry Reid, and Ed Rendell have gotten in trouble for advocating with the executive branch on behalf of businesses.

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