I'm From Wall Street and I've Got a Deal for You

ProPublica studies the tobacco bonds.  Last century (1998) the state attorneys general and the tobacco companies reached a settlement, which gave states money over a number of years with the amount dependent on how much people smoked: the more they smoked, the more money since the logic was to cover the costs/externalities of smoking.

Wall Street came along and persuaded states to securitize the settlement, to sell bonds based on the stream of anticipated income from the tobacco settlement.  States would get more cash upfront (to be used as the politicians desired).  That's not a new idea but surprise, surprise, the deal is turning out to be better for Wall Street firms than for the states.

There were a lot of fancy deals made during the 90's and 00's; I hope someday there's an overview study which shows how many turned out okay and how many were snake oil.  The KISS rule also applies to finance.

SNAP and the USe of Time

Don't remember where I got this from.

Note the significant difference in time usage. What it says to me is that SNAP recipients, specifically mothers with kids, are time-constrained so they buy food which can be microwaved or is otherwise ready to go.  Individuals who receive SNAP benefits have time to cook.  Extrapolating, it means that SNAP  mothers are feeding their kids more fast foods.  My guess is that's less a "food desert" problem than a time scarcity problem.

Rights, We Have Rights

Two interesting bits on the rights front today: 

• A district court judge in Alabama issued a decision comparing regulation of abortion clinics to regulation of gun shops.  Both relate to constitutional rights, so shouldn't the balance between restrictive regulation and protecting rights be similar in both cases?
• And Missouri appears to have incorporated the "right to farm" into its constitution by referendum.

GMO's and Drugs

Buried in an article on the experimental drug cocktail given to the Ebola patients is the information that the contents of the cocktail derive from genetically modified tobacco plants.  Tobacco has attracted a lot of research interest, partly to find an alternate use instead of cigarettes and partly because it has characteristics which make it adaptable to producing proteins in its leaves (my memory of the science--likely to be inaccurate).

This raises a question for those foodies who diss GMO food: will you also diss GMO drugs?  Seems to me the arguments against both are the same. The possibility of harm to humans from something new.

A Blast From the Past--Price-Gouging on Rail Cars

Back in the 1800's farmers complained bitterly about freight rates charged by the railroads.  There was some justice to the rails' pattern, but because farmers depended so much on the rails to get harvests to market, any exploitation was too much. The result was our first independent regulatory commission, the ICC (Interstate Commerce Commission) and a strong impulse to the populist movement.

Fast forward to today, and this excerpt from Farm Policy:

What’s more, rail car rates than ran $300 to $400 a car a year ago have ballooned to $3,000 to $3,500 now, he says [Jerry Lehnert]. Eventually, those excess costs get passed on in bids, eroding farm incomes in the process.”

Not a Good Morning for Farmers in the Post

Two articles in the Washington Post: the toxic algae bloom in Lake Erie is blamed on runoffs of fertilizer and manure; the increase in "intersexed fish" in the Chesapeake over the years is blamed on runoffs of fertilizer and manure.  (An interseced

Is This Really True? Football

"Nowadays if you're 6' 3" and 280 pounds, you're too big for most skill positions and too small to play line."  Via Marginal Revolution, from a graphic showing changes in weight and height over the years.

Duplicative Payments and Management's Use of People and Money

GAO has a report on duplicative payments by USDA farm agencies. Basically, they found a lot of overlap (producers getting benefits from multiple programs) but not a whole lot of duplication (producers getting benefits from multiple programs for the identical cause, such as loss of production). They did recommend data matching in cases where duplication is possible, but RMA and FSA pushed back, arguing lack of resources. 

Bottom line: even though the taxpayer would gain if they identified the duplication (because the cost would be less than the money to be refunded, assuming there was 100 percent collection) it doesn't make sense to managers.  Assuming managers are good and rational, they see a bigger bang for the personnel and IR bucks in other areas.  The answer is to allow the agencies to keep  part of their collections, but that's not something likely to happen.

Harshaw's Corollary of Parkinson's Law

According to Parkinson's Law:

"work expands so as to fill the time available for its completion"

Or, as generalized since Mr. Parkinson first described it,

"The demand upon a resource tends to expand to match the supply of the resource"

In this light, I've Harshaw's corollary: 

 "books expand to overfill available bookshelves"

Of course, this is time-limited--books are a vanishing breed. 

Harshaw's Rule of Appropriations

Based on earmarks, block grants, and general experience, I venture to say:

"the more general the appropriation, the more likely to be; the more specific the appropriation the safer from cuts"*

* unless and until the sole Congressional sponsor leaves Congress.

For example, if Congress inserts a particular line item to buy a weapon, a plane or tank, that's pretty immune from being cut; if they appropriate $10 billion for training, that's going to be cut.