Sunday, February 17, 2008
Honesty from a Corporation
by Ken Houghton
Slaughtering cows that cannot otherwise stand increases the risk of BSE ("mad cow disease") in the food supply. Which is just one reason that bad treatment is also Bad Business Practice.
Another bad business practice is quoted at USFP:
I feel much better about domestic, let alone international, food processing standards now. In the nine months since Paul Krugman wrote "Yesterday I did something risky: I ate a salad," the stakes have only gotten higher.
It had been a while since I looked at U.S. Food Policy, but the largest beef recall in U.S. history reminded me I might be missing something. Indeed, Parke Wilde first discussed animal abuse captured on video which, at its best, would be cruel, only a week ago.
Slaughtering cows that cannot otherwise stand increases the risk of BSE ("mad cow disease") in the food supply. Which is just one reason that bad treatment is also Bad Business Practice.
Another bad business practice is quoted at USFP:
The most ridiculous sentence in today's article comes from the Hallmark official who had the unpleasant job of reconciling the company's earlier untrue claims with the facts:
"We certainly wouldn't have failed to disclose that if we knew it was in the public record," he said.
I feel much better about domestic, let alone international, food processing standards now. In the nine months since Paul Krugman wrote "Yesterday I did something risky: I ate a salad," the stakes have only gotten higher.
Labels: governance, Health Care, principal/agent problems
Thursday, February 14, 2008
I Won't, But Hank Paulson Will
by Ken Houghton
UPDATE: My Loyal Reader suggests that the caption should have read "praise" not "raise." Certainly that makes intuitive sense give the opening statement, which uses neither word but does declare, the evidence notwithstanding:
There are a lot of words there, so the chance of there being more lies than words is near zero. But it is likely that the caption should have read "praise."
Anyone have a screen shot?
Biggest lie of the day, as printed by CNBC "Breaking News":
PAULSON: Congress deserves raise for passing the stimulus package.
UPDATE: My Loyal Reader suggests that the caption should have read "praise" not "raise." Certainly that makes intuitive sense give the opening statement, which uses neither word but does declare, the evidence notwithstanding:
Four weeks ago, recognizing the downside risks to our economy and that the short-term cost of doing nothing was too high, President Bush called for an economic growth package to provide a temporary boost to our economy as we weather the housing correction.
The Congress responded with bipartisanship, cooperation and speed to pass an economic growth package that is temporary, broad-based and will assist our economy quickly. We have demonstrated to the nation and the world that we can come together to address the needs of the American people as we weather the housing downturn.
Yesterday, the President signed the economic package into law and Treasury is already working to send payments out to more than 130 million American households.
The IRS will manage the current tax filing season and simultaneously prepare to issue these additional payments starting in early May. Payments will be largely completed this summer, putting cash in the hands of millions of Americans at a time when our economy is experiencing slower growth. Together, the payments to individuals and the investment incentives for businesses will help create more than half a million jobs by the end of this year. [emphasis mine]
There are a lot of words there, so the chance of there being more lies than words is near zero. But it is likely that the caption should have read "praise."
Anyone have a screen shot?
Labels: Economics, governance, principal/agent problems
Tuesday, February 12, 2008
Marshall Jevons confirms part of my suspicion
by Ken Houghton
(For context, it was common belief among my cohorts in the Government Practice at PwC that government employment would decline by about 30% in the next 20 years. Since that was ca. 2001, we're more than 1/3 of the way there.)
Fortunately, Marshall Jevons presents the evidence graphically. What might have been expected to be a 7-10% decline is nowhere to be found.
So not only are they pouring sand in the gas tank, they are adding to the weight of the car. And heavier cars, as any physicist or Stata user can tell you, get lower performance.
If I weren't still buried in health data, with a side trip to MLB, one of the things I wanted to work out was whether the current "Small Government Republican" administration would have positive job growth without its additions of government jobs.
(For context, it was common belief among my cohorts in the Government Practice at PwC that government employment would decline by about 30% in the next 20 years. Since that was ca. 2001, we're more than 1/3 of the way there.)
Fortunately, Marshall Jevons presents the evidence graphically. What might have been expected to be a 7-10% decline is nowhere to be found.
So not only are they pouring sand in the gas tank, they are adding to the weight of the car. And heavier cars, as any physicist or Stata user can tell you, get lower performance.
Labels: full employment, governance, Republicans, Statistics
Tuesday, October 16, 2007
Firms Rise to their BoD's Level of Incompetence
by Ken Houghton
One of my B-School professors, Jeff Netter, recently wrote a Working Paper in which he found that Directors are being compensated more generously in the post-SOX world. Unfortunately, this doesn't mean that their demonstrated governance abilities have improved.
Via Felix, a piece in New York magazine on Citigroup Chair Chuck Prince gives us this gem:
As for the board, well, it will support Prince, as they say, until it doesn’t. It’s a board, it should be noted, that gave Prince a 13 percent pay raise, to $26 million, in 2006, a year during which Citi’s profits fell 12 percent and the company lost market share on several fronts. Says one former executive, “A different board would have thrown Sandy out. So it’s kind of strange to expect it would do something with Chuck. And many of them have faced the same issues as Chuck. Dick Parsons [of Time Warner] had Carl Icahn. Alain Belda [of Alcoa] has been criticized. And everybody knows what Mike Armstrong did to AT&T. With the exception of George David [of United Technologies], who is a rock star, none of them have distinguished themselves of late. It’s hard to imagine this group will take any action.”
One of my B-School professors, Jeff Netter, recently wrote a Working Paper in which he found that Directors are being compensated more generously in the post-SOX world. Unfortunately, this doesn't mean that their demonstrated governance abilities have improved.
Labels: Economics, governance, Regulation
Sunday, October 14, 2007
That Swedish Economics Prize
by Ken Houghton
Via Dani Rodrik (because I'm catching up on blogs in alphabetical order), Greg Mankiw does what he does best: plays politics, this time with the "Nobel" in Economics.
And even here, he's more of a politician than an economist:
Yep, that's Andrei Shleifer, about whom alone David Warsh is worth reading. (Start here or here.) And in honor of Janet Reno's new album, I want quote the final paragraphs of the second piece cited above:
That's what it takes to make it in Mankiw world these days, apparently: the willingness to undermine countries, as long as you have always had great connections.*
It has been over a decade since Mankiw reviewed Peddling Prosperity in JEL (JSTOR link). Mankiw recommends the book still (rather more strongly, I might suggest, than his original review indicated), while Krugman's reputation has, if anything, risen in the past decade.
One wonder if the same will be true of Shleifer.
*It would be callow of me to note that Shleifer's citations often come in the he edited, and where the editor may be said to have influenced the citations. It will be interesting to see if the rate of citations declines.
UPDATE: The game is played. The citations lose.
Via Dani Rodrik (because I'm catching up on blogs in alphabetical order), Greg Mankiw does what he does best: plays politics, this time with the "Nobel" in Economics.
And even here, he's more of a politician than an economist:
Based on citations, who is in line to get the prize? In that old ranking, the top two on the list who have not yet won the prize are [Eugene] Fama and [Martin] Feldstein. In this somewhat more recent citation ranking, the top two economists are Fama and [Robert] Barro. In this most recent ranking, the top two are Barro and [Andrei] Shleifer.
Thus, if I had to bet a dollar on this year's prize, I would put it on Fama, Feldstein, or Barro. Andrei, who is still in his 40s, will have to wait a few more years. But as long as he lives long enough, he is a sure thing.
Yep, that's Andrei Shleifer, about whom alone David Warsh is worth reading. (Start here or here.) And in honor of Janet Reno's new album, I want quote the final paragraphs of the second piece cited above:
Very little is known about whatever representations and back-channel communications took place among Harvard, the Justice Department and the US attorney's office in Boston during those three years, much less what went on in the government itself, among the Treasury, Justice and State departments (beyond simply staring daggers at one another, that is). The US attorney in Boston finally filed his suit near the end of September 2000 -- barely a month before the presidential election. Stern and Bloom have maintained principle silence throughout.
What is known is that the attorney general in those days was Janet Reno. Whatever appeals were made to her, she declined to interfere. The suit went forward, resulting in a jury verdict against Harvard and a finding of fraud against Shleifer.
Without that finding, the rise of Vladimir Putin and his high favorability ratings would be harder to comprehend. Commentators routinely note that among ordinary Russians, the sense of having been taken to the cleaners by the Americans is widespread. Then, too, ordinary Americans wouldn't understand that the Russians' grievance was genuine, if Stern and Reno hadn't stood their ground.
Instead, citizens of both nations received a vivid illustration of the meaning of the rule of law -- not even Harvard, for all its friends in high places, could break it with impunity. The first female Attorney General of the United States set a high standard, by which her successors will be judged.
That's what it takes to make it in Mankiw world these days, apparently: the willingness to undermine countries, as long as you have always had great connections.*
It has been over a decade since Mankiw reviewed Peddling Prosperity in JEL (JSTOR link). Mankiw recommends the book still (rather more strongly, I might suggest, than his original review indicated), while Krugman's reputation has, if anything, risen in the past decade.
One wonder if the same will be true of Shleifer.
*It would be callow of me to note that Shleifer's citations often come in the he edited, and where the editor may be said to have influenced the citations. It will be interesting to see if the rate of citations declines.
Labels: Economics, governance, Politics
Thursday, August 02, 2007
Celine Came in Seventh
by Ken Houghton
Can we really be talking about Worst Canadians?
Just as a reminder:
And the vegetarian dentist-turned-actor doesn't make the Top Ten.
Can we really be talking about Worst Canadians?
Former prime minister Pierre Trudeau has ranked as the worst Canadian according to an online poll, beating out notorious killers Paul Bernardo, Karla Homolka and Clifford Olsen.
Nearly 15,000 votes were cast in the poll, conducted by The Beaver, a history magazine. Chris Hannah of the punk rock group Propagandhi, who had waged a campaign to top the list, came in a close second.
Just as a reminder:
Labels: governance, pop music
Sunday, February 25, 2007
Spam, Spam, Spam...Management
by Ken Houghton
Pass it on. Do it. The only way to produce data-driven results is to present data.
From the comments to a post at Making Light, platedlizard notes:
Whenever I get suspicious email supposedly from ebay or Paypal I always report them to those companies. spoof@ebay.com and spoof@paypal.com. Spam in general should be reported to spam@uce.gov
Pass it on. Do it. The only way to produce data-driven results is to present data.
Labels: governance, phishing
