Friday, August 2, 2013

Was West Virginia a Victim of the Free Market?

And now a rare first person commentary!

I have wrestled with the idea of the "robber baron" theory of West Virginia economic development since I was in college.  Historians such as John Alexander Williams taught for decades that a once pristine and functional society fell victim to greedy and rapacious seizers of land and resources.  They squeezed the land and people dry of wealth, then abandoned the state for greener pastures in the 20th century.  This left the state with little to show for the sacrifices made.

Taking another look at this time is vital.  Historians and the books they write almost uniformly blame the free market for all the evils that took place.  This mainly comes from the fact that many of them fail to see that a truly competitive free market defended by rule of law is not synonymous with doing business.  Many of the abuses done by business and described by historians are the opposite of the free market.

Williams grafted a colonial-periphery theory from studies of the Third World.  In his explanation, West Virginia was a "colony" of New York based business interests.  They recruited and used a comprador class of local lawyers and other professionals to advance their interests and to get the people behind them.  This theory, advanced by many, portrays a naïve population duped, used, and left behind.  They made little intellectual contribution, so they bear little responsibility.

Others, such as West Virginia University's Ron Lewis, have described more moderate ideas that do not reduce either the businessmen nor the state's people to caricatures.  Lewis' works focus as much on the environmental sacrifices as well as the social and economic ones.

One cannot argue away the fact that West Virginia's environment was drastically changed by industrialization.  Lewis in Transformation of the Appalachian Countryside describes how practices of getting timber to market caused eroded hillsides, made vast areas more vulnerable to both floods and fire, and annihilated river life.  He also points out that the clear cutting actually worked to the economic detriment of the logging companies because the land could not renew its forests quickly.

So there was environmental sacrifice on the same lines as the rest of a country untutored in best practices.  Interestingly, the example of West Virginia and other Appalachian states (clear cutting removed almost all of the virgin forest in the region) showed the resiliency of the environment instead of the fragility.  Forests and streams rebounded fairly quickly.

And the environmental impact did not start with the Industrial Revolution, either.  Traveling writer Anne Royall described  the stripping of forests around the Kanawha Valley salt works in the first decade of the 19th century.  She talked about the ugly, stump ridden hillsides and the black smoke hanging in the air.  Before the salt industry, Indians and frontier farmers used rather wasteful methods to remove trees, farm a plot until the land wore out, then move on. 

The crux of the economic argument discussed by historians (but rebutted by economists such as Russ Sobel) is that wealth was "stolen" from West Virginia.

Did greed and hatred for humanity cause businessmen to swindle the people from their land, then force them into unhealthy jobs that paid nothing?  And did the state get nothing in return?

The record is mixed.  Some focus on the amount of money paid to landowners for their property.  Owners received a pittance compared to the value of resources removed.  In many cases, this is true.  The true market value of land isolated from centers of transportation and unsuitable for farming was very low.  Company agents looking for coal lands offered market value.  Some recognized the eagerness in the eyes of the agents and negotiated for more.  Others savored the idea of getting more cash than they had likely ever seen in their lives for what they thought was worth very little and took the offer without question or counterproposal. 

But other owners refused to sell.  Companies then brought in the lawyers.  Land claims in the mountains of what was once Virginia were a tangled mess.  People established claims with boundaries marked by trees or moss covered rocks, laid out in paces.  Different land offices granted the same land to separate people.  Residents lived on the land they thought was theirs.  Companies in Philadelphia, New York, and elsewhere bought competing claims.

So naturally many cases ended up in court.  With no clear ownership of the land established, judges had to fall back on legal principle.  Here is yet another example where government meddling in the private sector creates social problems. Before the Industrial Revolution, courts in Western Virginia used natural rights and common law principles.  The rights of the individual were more important than those of collective society.  With all else equal, a court would usually use the maxim "possession is 9/10 of the law."  The person living on the land, all else being equal, gets to keep the land. 

After industrialism took hold, courts moved to a collectivist social justice approach.  The maxim now was to advance the common good.  In any era, the common good is usually defined by entities trying to take resources from the less powerful individual for some other purpose.  Collectivism was on the side of big business.  So instead of advising the companies to make better offers or go elsewhere, courts ruled in favor of the companies "for the common good."

The common good was also supposedly advanced by a law allowing railroads to be built without permission on private land if the owners did not notice the construction of the rail line. 

Common good arguments are just as nefarious when done in favor of modern causes as they were when done to advance crony capitalist interests.  Every time used, the common good argument hurts the common individual man. They are rarely appropriate in a free society, even if the common good is advanced.

And the common good did advance.  It could have advanced just as far, if not farther, had the rights of individuals remained respected. But advance, it did.  Railroads connected most towns and county seats.  Mind you, sometimes the county seats were moved by force to the rail lines in some cases.  But it happened.

Satellite industries grew up around timber and coal extraction.  Paper mills, coke ovens, glassware, and other products were churned out of towns and cities across the state.  Trains and river traffic carried products to domestic markets and port cities.  The free public school system advanced farther and faster after the Civil War than nearly anywhere else south of the Potomac and Ohio Rivers.

At the time of the industrial revolution, dredged rivers, expanding rail networks, and establishment of free schools were all marks of progress.  West Virginia got those and a government weather station.

The argument that naïve or greedy natives sold out to big city interests falls flat.  Henry Gassaway Davis of Piedmont was a mover in politics and business, not one who was moved.  Elkins, who politically advised presidents and would-be presidents, chose to move to the state.  Johnson Camden did sell out his oil and gas interests to John Rockefeller in a Godfather-like "offer you can't refuse." But that was under pressure of riches or ruin and was the aberration instead of the rule.

Employment of the people also created a mixed result.  Abuses did happen, particularly in the southern counties.  Some companies took advantage of the isolation, using debt and low wages to create near serfdom style conditions in company towns.  The company owned the houses, stores, schools, and even churches.  Running afoul of the company meant a blacklisting from almost any job in the region.

Again, government and business worked too closely in unison in these areas.  Many sheriff's deputies worked double duty as law enforcement and company guards.  Law enforcement broke up the free association of union organizers and workers while also intimidating journalists.  The stifling hand of government allied with business perpetuated these abuses.  It is a sin of business, but not one of the free market.

On the other hand, those now working for cash money had more access to the benefits of industrialism.  Historians bemoan the move from self-sufficiency to the market economy.  But they do not consider the price of items compared to the value of the time spent in making them oneself.  Factory made clothes could be bought for cash earned in less time than it took mom or grandma to make homespun.  Food was cheaper when considered in this way. People also had access to medicine, newspapers, and other products rarely seen in some areas prior to the coming of industrialization.  Standards of living rose for most people.

Of course the downside lay in the fact that a cash paying job provided less security.  What happened to people laid off, too old, or too injured to work was a real social problem.

Overall, it is hard to see how one could find that business as a collective whole abused or stole from the state and people of West Virginia.  Then, as before and later, individual malefactors took advantage of people and the laxity of the laws.  But they do as much or more harm now by lobbying to use the power of government to eliminate competitors, or infringe on the rights of the people. 

Revisiting the interpretation of industrial history in West Virginia is necessary.  The perceived sins of the past are used against those trying to develop for the future.  We have all been raised to wrongly blame the free market system when many of the real problems stemmed from government help.  Except for the environmental destruction, which a more educated society and legal system has addressed adequately, the free market ideal is just not responsible

The lesson of West Virginia's past is not that the free market failed, it is that the failure to maintain a free market hurt the people.

Thursday, August 1, 2013

How "Space Weather" Could Knock Out Services Here On Earth and What Can Be Done to Prevent It

"There is no dispute that electric grids worldwide are vulnerable to potentially catastrophic damage from solar-generated EMP."

So said former Maryland Republican congressman and Howard University professor Roscoe Bartlett in 2011.  According to Britain's Daily Mail, an electromagnetic pulse (EMP) expelled from the Sun nearly slammed into Earth.  Humanity missed calamity by a narrow two weeks.

EMPs are accelerated and highly charged streams of particles.  They can come naturally from the Sun, or artificially from nuclear weapons blasts.  Such an explosion in the atmosphere could create an electromagnetic field that could fry unprotected electronics and electrical systems. 

According to the Heritage Foundation, "effectively, the U.S. would be thrown back to the pre-industrial age following a widespread EMP attack."  Presumably a natural EMP blast could produce similar effects.  A one in eight chance exists that Earth may suffer such an event by 2020.

Heritage in 2010 laid out suggested preparations to protect against EMPs

Step No. 1: Require the Director of National Intelligence (DNI) to Produce a National Intelligence Estimate (NIE) Describing Which Countries Are Capable of Launching an EMP Strike. The NIE should review not only the weapons systems themselves but the delivery systems and platforms capable of carrying the weapons. Additionally, Congress should obtain from the NIE the intelligence community’s assessment of how EMP-capable countries are incorporating those weapons into their broader military strategies.
The latter assessment would permit the President and his advisors to determine how the U.S. could respond to EMP threats as they arise. Such planning is an essential part of providing an effective defense against these threats.
Step No. 2: Press the Obama Administration to Prepare to Protect the Nation’s Cyber Infrastructure Against the Effects of EMP. Congress should direct the Department of Defense and the Department of Homeland Security to manage this effort, which should incorporate the recommendations of the commissions. For instance, the commission has determined that preparedness measures must account for the fact that the cyber infrastructure is quite dependent on the power grid. Thus, contingency planning must explore ways to keep the cyber system functioning without primary power.
Further, it recommends identifying the most critical elements of the cyber system that must survive an EMP attack. Finally, the commission recommends that preparedness planning account for the interdependency between the nation’s cyber infrastructure and other elements of the broader infrastructure. Overall, the key to preparing to counter the effects of EMP is to put barriers in place to prevent cascading failures in the nation’s infrastructure.
Step No. 3: Require the Navy to Develop a Test Program for Sea-Based Interceptors with the Capability to Intercept and Destroy Ballistic Missiles Carrying EMP Weapons Prior to Detonation. It is clear that ballistic missiles offer an ideal delivery system for an EMP weapon. For instance, an enemy of America could launch a short-range missile carrying an EMP weapon from a cargo ship off the U.S. coast. Clearly, the terminal-phase ballistic missile defense systems currently in the field or entering the field, such as the Patriot system and the Terminal High Altitude Area Defense system, will not reliably intercept such ballistic missiles prior to the detonation of an EMP warhead. The Standard Missile-3 Block IA (SM-3 Block IA), as a midcourse defense system, may be able to do so.
What the U.S. really needs to address this threat, however, is a version of the SM-3 that will intercept these kinds of missiles in the boost or ascent phase of flight. The Independent Working Group has recommended developing and fielding what it calls an “East Coast Missile Defense” to address this emerging threat.[3]
Accordingly, Congress should require the Navy to demonstrate the capability to produce new versions of the SM-3 interceptor that are capable of destroying a short-range missile in the boost or ascent phase of flight, prior to its reaching the preferred detonation points for an EMP warhead. This will require that Congress also provide the Navy with the funds necessary to undertake this test program.
If it chooses to do so, Congress could also direct the Air Force to undertake a companion program that would permit operational use of the Airborne Laser system to defend against an attack from a short-range missile.

EMPs have caused disruption before.  In 1989 they knocked out parts of Quebec's telephone infrastructure.  130 years prior, they interfered with telegraph operations not long after the invention of the device.

Wednesday, July 31, 2013

Putting Too Much Trust In Flawed Science Can Bring Bad Consequences

Sometimes science based on incomplete knowledge causes no harm.  Not too long ago, the Mid-Atlantic braced for what experts predicted would be a massive and destructive storm of wind, heavy rain, hail, and dangerous lightning.  Some changed travel plans while others stocked up.  The front passed with less sound and little fury, but residents were relieved at the mistake.

Science will always suffer from errors because it springs from the mind of humanity.  Nothing worldy exists in a state of perfection and no human or collection of people cannot account for every variable.  Science at best is the most educated guess possible based upon years, decades, centuries, or even millenia of analysis, experience, and observation.  That being said, sometimes science proceeds with less tested and known ideas.

This Forbes piece describes what happens when agendas take over in science.  The pressure to not be wrong creates situations where even lives may be lost because of the reluctance to admit failure.  In this case, the head of a study on ways to protect the heart during non cardiac surgery screwed up the results and covered up the dangers.  Many lives were lost to standards and practices based on bad medicine.

Obviously the researchers had agendas above and beyond truth and patient safety.  That is the other variable in science.  People bring in worldviews and goals that have little to do with scientific fact.  Drug companies have an incentive to push pills, so their motives should always be examined.  Those benefiting from huge grants for studies have to answer for money that they get from advocacy groups.

The general public and the media optimally should examine variables and incentives for certain results that can skew science.  Also, one must look at the possible harm caused by making decisions based upon flawed studies.

In the case of the controversial research on climate change, too many scandals, agendas, and bad research have clouded the results.  Leftist politicians want people to accept new regulations that hurt jobs, productivity, and wealth production.  They want the US to accept even more economic disadvantages even while the future is threatened by accelerating debt and rising prices. 

Any war needs a solid cause, not a constant shifting of reasons.  The War on Coal was launched on the supposed certainty of global warming.  Now that the Earth has been shown to not be warming over the past 15 years, they switched to "climate change."  This absurdly ignores the fact that the main climactic constant is change, showed by the Little Ice Age of 1350-1750 (dates approximated), for example.

Science is not shamanism.  It relies on imperfect minds and sometimes imperfect motivations.  When shown to be beneficial, we should use it.  But when we have reason for skepticism, we must ask science to study further.

Tuesday, July 30, 2013

Is PRISM Harming America's Foreign Trade? And also, what exactly is PRISM?

Last month, Britain's The Guardian and the Washington Post, via the famous/infamous Edward Snowden, reported on a mysterious government information collection program called PRISM. 

PRISM is an ongoing government effort to collect information from the internet about both foreign and domestic targets. Concerns about the collection and use of this data have produced a backlash from people and businesses around the world.  Many fear the effects, use, and possible misuse of information.

The National Security Agency somehow (it is not known how) obtains information about certain targets (it is not known who or why or how they are selected) from major internet entities, such as Facebook, Google, Yahoo, and others. All three of these companies, among others, strongly deny that they have granted access to the federal government for any information collection.

According to a Washington Post summary of known information:

We know that PRISM is a system the NSA uses to gain access to the private communications of users of nine popular Internet services. We know that access is governed by Section 702 of the Foreign Intelligence Surveillance Act, which was enacted in 2008. Director of National Intelligence James Clapper tacitly admitted PRISM’s existence in a blog post last Thursday. A classified PowerPoint presentation leaked by Edward Snowden states that PRISM enables “collection directly from the servers” of Microsoft, Yahoo, Google, Facebook and other online companies.

 It goes on to say that

The (New York) Times says that major tech companies have systems that “involve access to data under individual FISA requests. And in some cases, the data is transmitted to the government electronically, using a company’s servers.”
Data is “shared after company lawyers have reviewed the FISA request according to company practice. It is not sent automatically or in bulk,” the Times reports. The scheme is “a more secure and efficient way to hand over the data.”
A source told CNet’s Declan McCullagh that PRISM is “a very formalized legal process that companies are obliged to do.” A source — perhaps the same one — says that “you can’t say everyone in Pakistan who searched for ‘X’ … It still has to be particularized.”

Additional reporting by Cato Institute writer Julian Sanchez raises more concerns.  The law which pertains to PRISM removed the constitutionally necessary provision that a warrant must be obtained if the main target was a non citizen.  However, information collected about a US citizen in the process is allowed to be stored until someone proves that it is worthless.

The NSA itself makes the determination on the worthiness of the information.

Furthermore, information under some circumstances can be obtained and kept even if the only people involved are US citizens.

The knowns, unknowns, and what is unknown that is unknown have introduced uncertainty into the equation.  As US and foreign media scurry to gain further insight on the scope and target of the program, other countries may be setting up what defenses they can.

Companies involved in data collection and security, along with their home countries, fear intrusion by American intelligence services. At a recent panel held by the Information Technology and Innovation Foundation, a guest speaker pointed out that some countries may follow Brazil in passing laws to protect digital information and commerce.  This measure passed by countries fearful of surveillance could backfire in restricting information to places with archaic security.

Furthermore, it is difficult to estimate how many foreign nationals may try to avoid doing business with American firms because of PRISM and the lack of understanding about it.

Most agree that speculation about PRISM is driven in part by fear of the unknown, as well as the potential for abuse.  It remains to be seen what the world's reaction will be, as well as what the full scope of the program actually is.  

Monday, July 29, 2013

Is the EPA's War on Coal Distracting It From Real Public Safety Threats?

The Environmental Protection Agency has pushed hard against West Virginia coal companies and farmers. It has pushed miners out of work over the questionable and controversial "climate change" agenda.  Power plants are slated to shut down in many areas due to draconian new regulations.  At the same time, EPA bureaucrats have, with mixed success, launched regulatory broadsides against family farms. But in their zeal to promote certain agendas, have they neglected proven threats to the environment and public safety?

Most people do not consider what happens when they discard electronics.  E-waste, as it is often called, contains deadly materials such as mercury and cadmium that can leach into the water supply.  Because disposal can be difficult, 70 percent of the world's electronic trash has ended up in China.  There, many make a dangerous living washing off old parts in hydrochloric acid, and working directly with mercury coated components.

Press coverage has forced the United Nations and others to watch the illegal traffic more closely, meaning that growing piles of material remain in the United States for legal disposal.  A major snag, however, lies in the fact that the EPA has not established guidelines for disposal.

A Washington Guardian report shows that in 2009, the US handled 1.77 million tons of material.  It was incinerated, or otherwise disposed of.  The EPA's inspector general, however, claimed that "EPA does not have adequate information to ensure effective E-waste management and enforcement to protect public health and conserve valuable resources."

Furthermore, the EPA has very little data on how waste is stored, or what is done with it. Even the cathode ray tube guidelines implemented under the Bush Administration have not been enforced well, due to declining budgets.

The EPA does its best work when it responds capably to proven threats to public safety.  Therein, it justifies its existence and budget.  Unfortunately, it appears that its zeal to adhere to the unproven theory of climate change may be putting public health at risk.