Tag: regulation

Federal Reserve Open Market Committee Issues Report

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 A brief summary of their statement is, “Sh%$ is f%$#ed up, and we have to do something.”

Federal Reserve officials expect to leave interest rates near zero for years — through at least 2023 — and will tolerate periods of higher inflation as they try to revive the labor market and economy, based on their September policy statement and economic projections released Wednesday.

The announcement codifies that the Fed chair, Jerome H. Powell, and his colleagues plan to be extraordinarily patient as they try to cushion the economy in the months and years ahead.

The policy-setting Federal Open Market Committee “expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the committee’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time,” officials said in their statement.

………

The Fed updated its Summary of Economic Projections, a set of estimates for how the economy and interest rates will develop in coming years. Officials saw unemployment ending 2020 at a lower rate than it previously forecast: The median official expects the rate to average 7.6 percent over the final three months of the year, compared with 9.3 percent when the Fed released its last set of projections in June.

It’s not a bad policy, but it comes from a horrible reality.

Boeing Still Can’t Make Airplanes

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It now appears that issues at Boeing’s union-busting plant in South Carolina are bad enough for the FAA to take notice:

Production problems at a Boeing Co. 787 Dreamliner factory have prompted air-safety regulators to review quality-control lapses potentially stretching back almost a decade, according to an internal government memo and people familiar with the matter.

The plane maker has told U.S. aviation regulators that it produced certain parts at its South Carolina facilities that failed to meet its own design and manufacturing standards, according to an Aug. 31 internal Federal Aviation Administration memo reviewed by The Wall Street Journal.

As a result of “nonconforming” sections of the rear fuselage, or body of the plane, that fell short of engineering standards, according to the memo and these people, a high-level FAA review is considering mandating enhanced or accelerated inspections that could cover hundreds of jets.

………

But that slip-up combined with another recently discovered assembly-line defect prompted Boeing to take the unusual step in late August to voluntarily tell airlines to ground eight of their 787s for immediate repairs. Since then, Boeing has publicly confirmed the eight planes weren’t safe to remain in service.

………

The manufacturing slip-ups mark the latest production problems for the troubled plane maker and present a test for Chief Executive David Calhoun and a revamped safety-review process after two fatal accidents of its narrow-body 737 MAX. The crashes took 346 lives.

THIS is what happens when you let finance guys run things.

This is Batsh%$ Insane

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As you may, or may not, be aware, there is a segment of fan-fiction called “The Omegaverse”, which is one part Supernatural fandom, and two (or maybe three) parts bad wolf science.

What you may not be aware of, unless you read the rather incomplete New York Times story, which tended to focus on a genre of literature that features, estrus, involuntary impregnation, involuntary sex, male pregnancy, and a lot of other stuff that makes Furries look like Mike Pence.

I understand why the Times focused on this, it’s salacious, and salacious sells.

It’s also kind of dull, unless it’s your thing, at least to me.

I am a cat person, thank you very much.*

What I find interesting is the use, and in this case abuse, of the DMCA (Digital Millenium Copyright Act) take-down provisions for a clearly unlawful purpose.

Well, that, and one the principals in the dispute committing perjury and lying to her fans, but again that is simply salacious, and does not address the larger issues here.

As many of you (OK, both of you) are are aware, the DMCA contains a safe harbor provision which says that so long as a platform responds promptly in response to a take down notice to material posted by a user, they cannot be held liable, much in the same way that you cannot sue a bookstore for a book that is defamatory, just the author and publisher.

What the process means is that there is very little upside for platforms to investigate whether or not an actual copyright violation occurs.  They will simply take the material down when a DMCA complaint, and if the complaint is in error, or maliciously wrong, it is no skin off of their nose.

What this has resulted in is DMCA take down notices being issued to coverup evidence of anti-union activity, corrupt politicians covering up their behavior, to extort YouTube channels, for profit academic journals moving against professors who posting their own research, and, of course, Dr. Who fan Ood Knitters.

What happened in this case was that the author, whose innovation appears to be bringing heterosexual relationships into the Omgaverse, and her publisher, went after another author for literary features of the genre, rather than any actual plagiarism, and sent out dozens of DMCA take-down notices to attack a rival in the genre.

It’s a classic case of misusing the DMCA for non-IP purposes.

Well, Lindsay Ellis gives a hysterically funny description of what went down here, and why what happened was wrong, and why the DMCA needs to be fixed.

It’s an hour long, but it’s well worth the watch.

*No, not THAT sort of cat person, NOT THAT THERE’S ANYTHING WRONG WITH THAT, at least not from a literary perspective.

Only Took 43 Years

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The Federal Reserve has been required to place equal weight on full employment and prices stability since the passage of the Humphrey-Hawkins act in the late 1970s.
It hasn’t. Instead, it has gone for real unemployment while fighting imaginary inflation.

It only took a few decades, but now the Fed has decided to change its policy, and so will no longer engage in monetary tightening just because unemployment is low, they will wait for actual inflation to show up:

In a historic break with decades of policy, the Federal Reserve announced Thursday that it will no longer deliberately keep millions of Americans unemployed at all times.

America’s central bank has a dual mandate — to promote full employment and price stability. These two aims were long presumed to be in tension: If unemployment fell too low — such that there was no slack in the labor market (i.e., no reserve of jobless workers for employers to draw on) — then workers would gain the upper hand on their bosses and demand wage gains in excess of their own productivity, which would force companies to raise the prices of their goods to keep up with their labor costs, which would then cause workers to demand still-higher wages to keep up with prices, in a vicious inflationary cycle.

For this reason, the Fed defined “full employment” as an unemployment rate significantly above the level one would expect from mere job-switching frictions. And when the labor market tightened beyond the level the Fed deemed conducive with price stability, it would start raising interest rates — to choke off credit creation, slow growth in the money supply, and thus, deliberately keep Americans out of work — even if inflation had not yet exceeded its official target.

………

In the aftermath of the Great Recession, the inequity of the central bank’s longtime prioritization of avoiding theoretical inflation — over the certain unemployment of millions of workers — became more conspicuous. The Fed’s official inflation target is 2 percent. But for a variety of reasons — among them, the tepid pace of the recovery and the weak bargaining power of American workers in an age of trade-union decline — price growth remained stubbornly below those levels, even as the central bank kept interest rates near zero. Nevertheless, despite the absence of any hint of excessive inflation, the Fed began raising interest rates in 2015, on the grounds that the U.S. could not sustain an official unemployment rate of below 5 percent without triggering a wage-price spiral.
………

Progressive (and a few growth-oriented conservative) economic-policy wonks pushed back on this move. Then, when a Republican president with a penchant for easy money came to power — and the GOP’s inflation hawks went dutifully silent — Trump’s appointed Fed chair, Jerome Powell, adopted a more accommodative stance. And America proceeded to learn that its economy could not only abide a 3.6 percent unemployment rate without suffering runaway inflation, but that such a rate wasn’t even sufficient to bring inflation to its target level of 2 percent. The theorized hard trade-off between unemployment and price stability did not appear to exist, which meant that America’s finest economic minds had been slowing growth and killing jobs for no good reason.

………

(1) The Fed will no longer presume that it knows what the maximum level of employment in the U.S. economy is, and will therefore refrain from raising interest rates until there are clear signs of excessive inflation.

(2) The Fed will not treat its 2 percent inflation target as a maximum, but rather as the average rate it wishes to promote over an extended period of time. Which is to say: If inflation runs a bit below that target for years on end, then the Fed will tolerate inflation a bit above that target for a few years after.

I am not surprised that the Fed Chair who did this is not an economist.

Of Course They Would Say That

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Yes, they are lying

AT&T and T-Mobile are objecting to the proposed FCC requirement that they actually test out their cellular coverage maps with tests.

They claim that it is too expensive, and too difficult, but the reality is that they have been marketing on a plausible lie, and good data will make those lies implausible:

AT&T and T-Mobile are fighting a Federal Communications Commission plan to require drive tests that would verify whether the mobile carriers’ coverage claims are accurate.

The carriers’ objections came in response to the FCC seeking comment on a plan to improve the nation’s inadequate broadband maps. Besides submitting more accurate coverage maps, the FCC plan would require carriers to do a statistically significant amount of drive testing.

………

This could prevent repeats of cases in which carriers exaggerated their coverage in FCC filings, which can result in government broadband funding not going to the areas where it is needed most. Small carriers that compete against the big three in rural areas previously had to conduct drive tests at their own expense in order to prove that the large carriers didn’t serve the areas they claimed to serve.

FCC Chairman Ajit Pai did not punish Verizon, T-Mobile, and US Cellular after finding that the carriers exaggerated their 4G coverage in official filings. But Pai is moving ahead with plans to require more accurate maps as mandated by Congress.

………

AT&T objected to the proposed drive-testing requirement in a filing to the FCC on Tuesday this week, saying that annual “drive testing is not the proper solution for verifying nationwide coverage maps” and that there is “potential difficulty in determining how to formulate a statistically valid sample for areas given the terrain variability nationwide.”

Also, they want the bad data, because it prevents subsidies going to small independent carriers in rural areas, and more than anything else, they want their oligopolies to remain intact.

F%$# the phone carriers, mobile and land line both.

Mandy Rice-Davies Applies*

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Of course they are.  They are opposed to anything that would make it harder for them to monetize our privacy:

The trade group representing many of the largest technological security companies is urging regulators not to overreach on facial recognition restrictions even as U.S. lawmakers push to rein in police use of the software.

The Security Industry Association, which represents NEC Corp., France’s Idemia Group, Japan’s Ayonix Corp. and others, will release on Tuesday day a 10-point framework urging policy-makers, companies and governments to embrace the benefits of the technology, while upholding certain ethical principles.

SIA is defending government use of facial recognition at a time when some civil rights advocates, companies, and lawmakers are calling for police departments to stop using the technology. Critics want better guardrails to ensure facial recognition doesn’t promote racial biases in the criminal justice system.

Calls to curb law enforcement’s use of the technology grew louder during widespread public outrage over racial inequities following the death of George Floyd, an unarmed Black man, in Minneapolis police custody in May.

SIA’s policy principles, obtained by Bloomberg News, caution lawmakers not to adopt a “one-size-fits-all legislative framework.”

Here is a quick rule of thumb:  When businesses start proposing regulatory forbearance, or suggesting that, “One Size Fits All,” legislation (mark your bullsh%$ bingo card) would be a bad thing, and that they are proposing, “Policy Principles,” it means that they want business as usual to continue, typically by sucking the marrow out of the public space.

These folks want to make money by being evil, and they don’t care if they sell to corrupt and brutal cops in the USA, or Chinese authorities enforcing a genocide against the Uighurs. 

*Well, he would say that, wouldn’t he? Seriously, know your history.

The Single Best Point about Cancel Culture

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In all the back and forth about Cancel Culture, a central issue is that as-will employment makes the effects of publish shaming far more dire than they should be.

Being an asshole on Twitter should not be a firing offense, no matter how much it might justify shame and approbrium:

You know what should be canceled? The legal right of most bosses to fire you for a “good cause, bad cause, or no cause.”

That status quo is so widely accepted that some progressives don’t think twice about appealing to the authoritarian power of bosses in the pursuit of social justice: Many high profile social media campaigns have been employed to get people who are caught on video committing racist acts in their everyday lives fired from their jobs. But the desire to hold racists and sexists accountable—or the related struggles against sexism, homophobia and fascism—need not be in conflict with the principles of workplace rights.

So-called “cancel culture” is not well-defined, but its critics frequently use the moniker to refer to an activist program of making individuals who harm their neighbors or coworkers with acts of racism, sexism (and worse) accountable through exposure and de-platforming—including attempts to get them fired. Liberal critics have been more likely to raise free speech concerns than any about workers’ rights, while leftists are likelier to argue that free speech doesn’t mean freedom from the consequences of speech.

………

Three years ago, we published an op-ed in the New York Times explaining how U.S. workers lack a basic right to their jobs that many workers in other countries enjoy as a legal standard. As a solution, we proposed a just cause “right to your job” law as a badly needed labor law reform. Since then, we’ve been encouraged to see the issue turn up on many progressives’ agenda.

In the debate between a right to your job and the need to de-platform bigots, some have raised concerns that without the boss’s right to fire an employee for any reason, racists and sexists would get more of a free pass at work. But this argument misses what “just cause” means. It doesn’t mean that employees cannot be fired, it means they can’t be fired for a reason that’s not related to work. Racism, sexism, harassment and other forms of conduct in and out of the workplace that make other employees feel unsafe and violate policies around respect and equity are grounds for discipline and termination—but are also subject to due process. When you look at how “just cause” plays out in areas where it exists—in the public sector, under many union contracts, or in other countries—it’s clear that racists, sexists and harassers are, in fact, disciplined.

Indeed.

Drip, Drip, Drip

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This means that the Gypsy cab companies may have to start paying for yet another societal cost that they foist on the rest of us.

The order is directed at the New York unemployment office, but it appears that it will likely force these companies to report earnings, and (eventually) pay the unemployment insurance premiums that they have been evading:

A federal judge has ordered the state of New York to quickly pay unemployment benefits to four Uber and Lyft drivers who have been waiting for the payments since March or April. The New York Taxi Workers Alliance, which filed a lawsuit over the issue back in May, says that the ruling could ultimately help thousands of drivers in similar situations.

Uber and Lyft have long argued that its drivers are independent contractors, not employees. That stance has come under increasing pressure. Since 2016, the New York Department of Labor has held that ride-hail drivers were employees for purposes of unemployment insurance. But Uber and Lyft have dragged their feet, failing to provide wage data that would enable the agency to calculate unemployment payments for each worker.

As a result, when Uber and Lyft drivers forced out of work by the pandemic applied for unemployment benefits, some were told that they weren’t eligible because state data showed them with zero earnings. Workers continued to be denied benefits even after they submitted 1099 tax forms showing their earnings.

………

In her Tuesday ruling, Judge LaShann DeArcy Hall sided squarely with the drivers. She acknowledged that Uber and Lyft bore some of the blame for failing to supply the state with necessary data. But she said the state still had an obligation to pay benefits promptly—using data supplied by workers themselves if necessary.

Assuming that Andrew “Rat Faced Andy” Cuomo is not in the gig companies’ pockets, (a big if) collecting wage data, along with pursuing payment of premiums, should occur as a matter of basic bureaucratic imperative.

This is No Surprise

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The European Court of Justice has ruled that servers in the US are insufficiently secure to comply with EU privacy regulations.

This is no surprise. The deal with the US has largely been a fig-leaf created as a result of brow-beating of European regulators by the US State Security Apparatus:

The European Union’s top court on Thursday threw a large portion of transatlantic digital commerce into disarray, ruling that data of E.U. residents is not sufficiently protected from government surveillance when it is transferred to the United States.

The ruling was likely to increase transatlantic tensions at a moment when President Trump has already been threatening tariffs and retaliation against the E.U. for what he says are unfair business practices. It was a victory for privacy advocates, who said that E.U. citizens are not as protected when their information is transferred to U.S. servers as when that information stays inside Europe.

The European Court of Justice ruled that a commonly used data protection agreement known as Privacy Shield did not adequately uphold E.U. privacy law.

………

The court said that it was unacceptable for E.U. citizens not to have “actionable rights” to question U.S. surveillance practices.

European data privacy advocates celebrated the decision.

It’s a good thing that the US State Security apparatus is finally getting some push-back internationally.

I Am Legitimately Pleased by This News

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I had figured that the rat-bastards had won, but a Federal Judge has just shut down the Dakota Access Pipeline.

I did not see this coming.

The regulatory rollbacks of the Trump administration are subsidies, and it’s good that the courts are pushing back:

A number of recent legal defeats and business decisions have stymied three multibillion-dollar pipeline projects around the country, setting back President Trump’s 3½-year effort to expand oil and gas development in the United States.

………

In a surprise decision Monday, a federal judge ruled that the Dakota Access pipeline — which Trump approved within a month of taking office — must be shut down by Aug. 5, saying federal officials failed to carry out a complete analysis of its environmental impacts. The day before, two energy companies behind the controversial, 600-mile Atlantic Coast Pipeline abandoned their six-year bid to build it, saying the $8 billion project has become too expensive and faces an uncertain regulatory environment. And an April decision by a federal judge in Montana dealt a blow to the Keystone XL pipeline and raised questions about whether the U.S. Army Corps of Engineers will have to conduct more extensive environmental reviews for other projects.

………

American Petroleum Institute President Mike Sommers said in a statement Monday that his trade group was “deeply troubled by these setbacks for U.S. energy leadership.”

Their tears are sauce for my lamb chops.

………

In several instances, long-standing statutes such as the National Environmental Policy Act, which requires federal agencies to assess and disclose how their decisions might harm the environment, have tripped up the administration. In his ruling regarding the Dakota Access pipeline, U.S. District Judge James E. Boasberg wrote that the federal government had not met all the requirements of the 50-year-old-law, which the administration is seeking to rewrite.

………

Several tribes, including the Standing Rock Sioux and Cheyenne River Sioux, first challenged the pipeline in 2016. While the Obama administration slowed the pipeline’s development as it consulted with the tribes, Trump expedited its construction immediately after taking office.

“Today is a historic day for the Standing Rock Sioux Tribe and the many people who have supported us in the fight against the pipeline,” said the tribe’s chairman, Mike Faith, in a statement. “This pipeline should have never been built here. We told them that from the beginning.”

I am happy.

Nature Cannot Be Fooled

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The good little Neoliberals in Chile decided to increase forestation and offset carbon emissions by paying loggers to plant forests.

This program achieved none of its goals:

A multi-decade state program to subsidize tree planting in one of South America’s wealthiest nations led to a loss of biodiversity and did little to increase the forests’ capacity to capture greenhouse gases.

Chile’s plantation forests more than doubled between 1986 and 2011, while native forests shrunk by 13%, according to a new report by U.S. and Chilean academics. The country subsidized tree planting while its forestry sector boomed over that period.

Yet the environmental benefits are not as clear. Subsidies accelerated biodiversity losses in Chile as plantations often focus on one or two profitable tree species, the report said. While forest area expanded by more than 100% between 1986 and 2011, the carbon stored in vegetation increased by just 1.98% during that period.

“Our simulations indicate that plantation subsidies accelerated biodiversity losses in Chile by encouraging the expansion of plantations into more biodiverse forests,” researchers said in the paper published inNature Susainability on Monday. Chile’s case “provides several cautionary lessons,” according to Robert Heilmayr at the University of California Santa Barbara, Cristian Echeverria at Universidad de Concepcion in Chile and Eric F. Lambin at Stanford University.

This has happened time and time again:  Attempts to enlist the profit motives to achieve a public good generate profits, but little in the way of public good.

The title is taken from Nobel Prize winning physicist Richard Feynman’s comment in the appendix that he authored for the report on the space shuttle Challenger destruction:

For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled.

Welcome to the Brotherhood of Sh%$-Hole Nations

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As a result of an abysmally managed pandemic response, it is looking increasingly likely that the EU is giving serious consideration to banning travelers from the United States.

This is some definition of, “Making America Great Again,” that I was previously unaware of:

European Union countries rushing to revive their economies and reopen their borders after months of coronavirus restrictions are prepared to block Americans from entering because the United States has failed to control the scourge, according to draft lists of acceptable travelers reviewed by The New York Times.

 That prospect, which would lump American visitors in with Russians and Brazilians as unwelcome, is a stinging blow to American prestige in the world and a repudiation of President Trump’s handling of the virus in the United States, which has more than 2.3 million cases and upward of 120,000 deaths, more than any other country.

 European nations are currently haggling over two potential lists of acceptable visitors based on how countries are faring with the coronavirus pandemic. Both lists include China, as well as developing nations like Uganda, Cuba and Vietnam. Both also exclude the United States and other countries that were deemed too risky because of the spread of the virus.

Welcome to the 3rd world, folks.

Payback is a Bitch

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Remember when Florida required anyone coming there from New York to quarantine for 14 days?

Well now New York, New Jersey and Connecticut are requiring a 14 day quarantine for travelers from Florida, Alabama, Arizona, Arkansas, North Carolina, South Carolina, Texas and Utah.

Oh to be a fly on the wall the meeting between Governors Cuomo, Murphy, and Lamont:

Hey, remember those hicks down south getting in our face?

It’s Payback Time

(Disclaimer: This is not an actual dialogue.  It’s the product of my imagination.)

I am amused.

Doing the Right Thing for the Basest of Reason

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This is driven by bigotry and politics, with Covid-19 being used as a pretext, but it is the right thing to do.

The visas in question, H-1B, L-1A, etc. are intended to bring in people who with skills that are unavailable in the United States.

In reality, it’s primarily about getting cheap foreign workers into the country, with foreign body shops like Infosys and Tata being the largest users of the program.

The tech companies are screaming that the sky is falling, but they will be able to get what they need, they will just need to pay a few bucks more an hour:

President Trump issued a proclamation Monday barring many categories of foreign workers and curbing immigration visas through the end of the year, moves the White House said will protect U.S. workers reeling from job losses amid the coronavirus pandemic.

The ban expands earlier restrictions, adding work visas that many companies use, especially in the technology sector, landscaping services and the forestry industry. It excludes agricultural laborers, health-care professionals supporting the pandemic response and food-service employees, along with some other temporary workers.

The restrictions will prevent foreign workers from filling 525,000 jobs, according to the administration’s estimates. The measures will apply only to applicants seeking to come to the United States, not workers who already are on U.S. soil.

“American workers compete against foreign nationals for jobs in every sector of our economy, including against millions of aliens who enter the United States to perform temporary work,” the proclamation states. “Under ordinary circumstances, properly administered temporary worker programs can provide benefits to the economy. But under the extraordinary circumstances of the economic contraction resulting from the COVID-19 outbreak, certain nonimmigrant visa programs authorizing such employment pose an unusual threat to the employment of American workers.”

In fact, these problems have always posed a threat to American workers and American workers’ wages.

The real goal of these programs has been to supply cheap tech labor since before I graduated from college. (I literally had someone in an unemployment office in 1982 tell me not to bother, because H-1B job postings were not a real job opening.)

I expect this to be reversed shortly after the election, but this moratorium will provide an opportunity to show that there is no real STEM shortage, and this is a good thing.

Bummer of a Birthmark, Uber

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The California PUC has just made it official, ruling that the drivers for Uber and Lyft are employees, not independent contractors.

I guess that the “Ride Sharing” companies are going to have to find a new way to f%$# over their drivers to justify the obscene money that they pay their senior executives.

Oh, the humanity.

Think of the venture capitalists!

The California Public Utilities Commission, which regulates private transport companies including Uber and Lyft, has ruled that the two upstarts’ drivers should be recognized as employees instead of contractors.

The issue over the status of drivers for ride-hailing companies has been controversial for a while. Cali Governor Gavin Newsom signed Assembly Bill 5, known as AB5, that classifies gig economy workers, such as Uber and Lyft drivers, as employees in the US state.

The law came into force in January this year, though Uber and Lyft have resisted the change. Both companies were sued by the state’s Attorney General Xavier Becerra last month for failing to recognize its drivers as employees. Now, the California Public Utilities Commission has weighed in.

About f%$#ing time.

A Good Start

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Fresh off his statement that he saw no police hitting people with nightsticks, Andrew Cuomo as said that he will sign legislation speeding through the New York State legislature enacting major police reform:

Rep. Alexandria Ocasio-Cortez on Monday urged Americans to stay the course in the massive protests which have been held in cities and towns across the U.S. for the past two weeks, pointing to New York State lawmakers passing long-awaited legislation to classify chokeholds as a felony as evidence the pressure is working.

The Eric Garner Anti-Chokehold Act passed in the New York State Assembly with a vote of 140-3. The bill now heads to Gov. Andrew Cuomo, who is expected to sign it into law.

“Stay in the streets,” tweeted Ocasio-Cortez. “It’s working.”

Stay in the streets. It’s working ⬇️ https://t.co/XoDiQ0dLJK

— Alexandria Ocasio-Cortez (@AOC) June 8, 2020

The bill was passed two weeks into a nationwide uprising over police brutality and racial injustice sparked by the killings of George Floyd, Breonna Taylor, Ahmaud Arbery, and countless other black Americans.

Additionally, the state legislature has passed a bill repealing New York Civil Rights Law section 50-A, which made police disciplinary records secret, makes the state Attorney General a special prosecutor in the event of possible police misconduct, require police departments to report statistics on the ethnicity of people arrested, requiring officers to immediately report when they have discharged their weapons in the line of duty, repealing the requirement that police disciplinary proceedings be run by police, and other reforms.

As I noted in the hed, it’s a good start.

Round Up the Usual Suspects

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What a surprise. The Trump administration official running the bailout is directing aid to his family’s business:

Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin have become the public faces of the $3 trillion federal coronavirus bailout. Behind the scenes, however, the Treasury’s responsibilities have fallen largely to the 42-year-old deputy secretary, Justin Muzinich.

A major beneficiary of that bailout so far: Muzinich & Co., the asset manager founded by his father where Justin served as president before joining the administration. He reported owning a stake worth at least $60 million when he entered government in 2017.

Today, Muzinich retains financial ties to the firm through an opaque transaction in which he transferred his shares in the privately held company to his father. Ethics experts say the arrangement is troubling because his father received the shares for no money up front, and it appears possible that Muzinich can simply get his stake back after leaving government.

Corruption in the Treasury Department is nothing new.

Timothy Geithner got a VERY comfortable sinecure (I use this word a lot) as a back-end payoff for his “foaming the runway” for banks on the backs of homeowners.

Still, this does seem to be a bit brazen.

When Ajit Pai Seizes the Moral High Ground………

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Of course, when your competition is Elon Musk, it’s a low bar to clear.

Pai just called out Musk’s play for government subsidies by labeling his Starlink satellite network high latency:

The Federal Communications Commission is not convinced that SpaceX’s Starlink broadband network will be able to deliver the low latencies promised by CEO Elon Musk. As a result, FCC Chairman Ajit Pai is proposing limits on SpaceX’s ability to apply for funding from a $16 billion rural-broadband program.

While traditional satellite broadband generally suffers from latency of about 600ms, Musk says that Starlink will offer “latency below 20 milliseconds, so somebody could play a fast-response video game at a competitive level.”

Everyone expects Starlink to offer much lower latency than traditional satellites because SpaceX satellites are being launched in low Earth orbits ranging from 540km to 570km. By contrast, geostationary satellites used for broadband orbit at about 35,000km.

“SpaceX claims that because its low-Earth orbit satellite system operates at ‘an altitude of 550 kilometers,’ it can deliver roundtrip latency at less than 50ms,” according to a public draft of Pai’s proposed rules for the $16 billion Rural Digital Opportunity Fund distribution. But the FCC plans to classify SpaceX and all other satellite operators as high-latency providers for purposes of the funding distribution, saying the providers haven’t proven they can deliver low-latency broadband.

………

SpaceX and other satellite operators are also being ruled ineligible for a gigabit tier. Both the latency and gigabit decisions would put SpaceX at a disadvantage. As Pai said in an announcement, his plan “prioritizes bids offering to provide even faster speeds (up to a gigabit) and lower latency by giving those bids greater weight in the auction and awarding support to the bidder offering the best combination of speed and latency in each area.”

SpaceX has made demonstrations, but they are breadboards conducted under optimum conditions.

Once Starlink is in service, and is serving customers in the real world, that decision can be revisited, but my guess is that the claims of high bandwidth and low latency will be as much of an illusion as Tesla’s claims of self driving cars being just around the corner.