333 (5 September 2018)

Welcome to week 333!  The articles below caught my attention this week.  What are intended to be relatively objective “briefs” are preceded by dashes (——–), whereas additional material or relatively subjective comments are preceded by asterisks (********).  Article titles preceded by [SR] require a subscription to be read in their entirety, although complete articles might be found by an Internet title search.

Please let me know if you have questions or comments.

(29 August 2018): Miami Will Be Underwater Soon.  Its Drinking Water Could Go FirstBloomberg Businessweek

——–“Barring a stupendous reversal in greenhouse gas emissions, the rising Atlantic will cover much of Miami by the end of this century.  The economic effects will be devastating: Zillow Inc. estimates that six feet of sea-level rise would put a quarter of Miami’s homes underwater, rendering $200 billion of real estate worthless.  But global warming poses a more immediate danger: The permeability that makes the aquifer so easily accessible also makes it vulnerable.  ‘It’s very easy to contaminate our aquifer,’ says Rachel Silverstein, executive director of Miami Waterkeeper, a local environmental protection group.  And the consequences could be sweeping. ‘Drinking water supply is always an existential question.’  County officials agree with her.”

********In my reading, I have tended to focus on (be impressed by) sea-level rise and its effect on land and dwellings.  What this article points out is that what happens below, e.g., to the aquifer, is important, more immediate, and perhaps more insidious because it is not easy to see.

********The article “Life Without Water: Sweaty, Smelly, and Furious in CaracasBloomberg.com provides a glimpse of what a life without water, most of the time, is like and makes a connects to the article immediately below.

(30 August 2018): Venezuela’s Neighbors Join Forces to Contain Crushing Flow of RefugeesBloomberg.com

——–“Venezuela’s accelerating slide toward mass starvation has become a continental disaster and South American governments this week began trying to manage it together.  With thousands of migrants pouring over the border—an outflow equal to the Mediterranean refugee crisis—government officials are meeting in Colombia, Peru and Ecuador to coordinate a response that so far has been haphazard.  On the agenda are measures to prevent epidemics, harmonize identification requirements and share the burden of relief. . . . In all, 2.3 million Venezuelans live outside the country, with more than 1.6 million fleeing the ravaged petrostate since 2015, according to the United Nations High Commissioner for Refugees.  That’s roughly equal to the flow of migrants to Europe in the same period.  The crisis looks likely to worsen as oil output plunges thanks to mismanagement, and hyperinflation defies attempts to rein it in.”  Bearing the brunt of the exodus is Colombia, “which has a 1,400-mile border with Venezuela.”

********I admit to being oblivious to the humanitarian crisis taking place in Venezuela and the region.  Here is a map of the region if you, like me, could use a refresher.  In searching for a little background, I found “How Venezuela’s crisis developed and drove out millions of peopleBBC.com, which is current (22 August 2018) and comprehensive.  Two statistics jump out: 95% of government revenue comes from oil exports and the 2018 inflation rate is predicted to be 1,000,000%.  In 2017, approximately 600,000 Venezuelans migrated to Colombia, 290,000 to the U.S., 208,000 to Spain, and 119,000 to Chile.  The projected inflation rate will likely continue to lead Venezuelans to conclude that they would be better off living someplace else.

(30 August 2018):Rawls rules: Three post-war liberals strove to establish the meaning of freedomThe Economist

********This brief is the fifth of six Philosophy Briefs on Liberal thinkers.  Here we encounter the ideas of: Isaiah Berlin, who distinguished between negative and positive liberty in “Two Concepts of Liberty” (1958); John Rawls, who wrote A Theory of Justice (1971), and Robert Nozick, the author of Anarchy, State, and Utopia (1974).  The connections among then, especially between Rawls and Nozick, are clearly laid out; the Stanford Encyclopedia of Philosophy has a scholarly entry on “Positive and Negative Liberty.”  I found the discussion relating to identity and freedom of expression to be thought provoking.

********Connected to this brief in an unexpected way is the interview by Kai Ryssdal, host of “Marketplace,” with Arthur C. Brooks, the outgoing president of the American Enterprise Institute who will soon teach at Harvard University.  The interview is titled “Outgoing AEI president wants a healthy ‘competition of ideas’.”  Ryssdal sought to get his perspective on some current matters in light of the AEI’s motto “a competition of ideas is fundamental to a free society.”  There are a number of things of interest in the article, but what really caught my attention—and will endure—is the response by Brooks to the following question by Ryssdal: “Do you think you’ve gotten traction on [some of your ideas] . . . in the past 10 years?  Or have you been shouting into the hurricane?

Brooks: Well, you know when you’re in the world of ideas it’s very easy to feel like you’re shouting into a hurricane. Why? Because you’re kind of a climate scientist in a world that’s more interested in weather reports. Politics is like the weather, and ideas are climate science. But in the end, in the long run, it’s ideas that matter the most.

(30 August 2018):The U.S.-Mexico Border Is Becoming a Banking DesertBloomberg Businessweek

——–“Sabrina Hallman’s seed business has operated out of warehouses [in Nogales] a short drive from the U.S.-Mexico border since 1989.  The Sierra Seed Co., which sells to commercial growers in Mexico, is well-known in her small Arizona town—as is Hallman, a former school principal who took over from her father as chief executive officer in 2007.  Three years later her bank was acquired, and its new owners cut off a line of credit her business had depended on for years.”  Regardless of the arguments Hallman made, they were to avail: “The company did business on both sides of the border and therefore posed a money laundering risk the bank wasn’t willing to take.  Rather than spend resources vetting and monitoring what it perceived to be a high-risk account—or face enormous fines for failing do so—Hallman’s company had to go.”  Enhanced scrutiny of banks “in high financial crime areas, particularly those near the border, has caused banks to retreat, unleashing a host of unintended consequences. . . . Businesses run by Mexican nationals, those that transact on both sides of the border, and those that deal primarily in cash were especially likely to get the boot.”

********An excellent example of the changes in the economic environment that can result from a particular historical event, in this case 9/11/2001.  As the article notes, “the real turning point for the Nogales border . . . Sept. 11.  The 2001 USA Patriot Act ramped up pressure on banks to detect and report suspicious activity and increased penalties on institutions that didn’t comply.  In 2012, HSBC got hit with a $1.9 billion fine for failing to stop the Norte del Valle and Sinaloa cartels from laundering more than $880 million of drug money.”

********The U.S. Government Accountability Office has written a report on the financial situation along the southwest border of the U.S.  You can learn more by the report’s website.

(31 August 2018):’It’s become a gold rush’: Inside the race to create smart shoes, custom razors and high-tech devices for the over-65 crowdThe Washington Post

——–For years Gillette mailed out free razors to “millions of men a year on their 18th birthdays.  Its ads focus on the experience passing from father to son (sometimes with the help of famous faces like quarterbacks Archie and Eli Manning).  But in recent years, executives have begun to see another milestone emerge in their customers’ lives: the moment when sons begin shaving their aging fathers.”  Recognizing this, Procter and Gamble, which owns Gillette, spent three years designing and testing what has become the Gillette Treo, which has features to address the requirements of those shaving others.  This is just once instance of reconceptualizing products in line with an aging population group, the baby boomers, who “still control 70 percent of the country’s disposable income.”  According to Danny Silverman of Clavis Insight, such rethinking of traditional products has “become a gold rush.”

********The article includes some of the research that was done on the Treo.  In a real-world test, traditional shaving materials in a nursing home took 12 minutes in contrast to 3 minutes for the Treo.  In addition, to the Treo resulted in a better experience for the person being shaved.  All this made me think of the principle involved in this redesign.  What changes to a product must be made when it is no longer used by “me” for me but instead used by someone else for me?  (I think I would call this recentering the user.)  As the Treo example shows, there is a lot to be learned from care givers.  Clearly these are opportunities that have been missed for far too long.  It is simply too easy to come up with a reason why that has been the case.  An example of how social and historical forces—the invisible handshake—enables us to not see, as well as see.

(3 September 2018):Will Judges Have the Last Word on Climate Change?Bloomberg Businessweek

********It depends, is the short answer to the question posed.  This is a nice summary of the use of the legal system as a means to slow climate change.  Approaches vary in the U.S. and in other countries, sometimes being aimed at national governments and agencies, sometimes at state and local governments, and sometimes at corporations.  In the U.S. environmentalists are “seeking their tobacco moment.”  Regarding tobacco, decades of litigation were unsuccessful before the tide turned.  When victory came, “settlements totaling $246 billion and permanent changes in the sale and marketing of cigarettes.  It’s a model that climate change activists would love to duplicate.”  The article concludes with The Reference Shelf, which provides access to six types of source materials.

(4 September 2018): [SR]Flood of Sand Points to Shakeout for Shale SuppliersThe Wall Street Journal

——–“Two years ago, many investors had the same idea: tapping the dunes of the West Texas desert to supply shale drillers with the sand they use in fracking.  Now, around 20 sand mines are set to be active in the Permian Basin, America’s most active oil field, by year’s end, and even some of those who put hundreds of millions of dollars between these startups predict they won’t all survive.”  The quality of sand in West Texas is an issue.  Typically frackers have favored “Northern White [Wisconsin sand] because of its superior ‘crush strength,’ or ability to withstand pressure deep underground . . . But when oil prices fell around 75% in 2014, companies were forced to seek savings in their supply chain and rethink using local sand.”  Oil producers using local sand can eliminate “the rail costs of Northern White, sometimes more that $60 per ton . . . But there are still doubts about local sand’s long-term performance.  So far, companies say it has not impacted initial production on wells, when they produce oil at their highest rates.  But it could limit production at later stages, experts say, as higher pressures expose the weaker crush strength of the local sand.”

********I continue to be fascinated by the relevance of sand quality for different uses.  This article has the additional complexity of short- and long-term production effects of different types of sand.  Presumably there are “crossover” levels of output and pricing differences that will make one quality of sand preferable to another.  So, something as seemingly prosaic as “sand” is full of complexity.

May you have a good week!

Bruce

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