Librarian big wig hates blogs, Google

This is my WAFM (What-A-F***ing-Moron) post of the day, a screed from the prez of the ALA.

Romania adopts flat tax

From IWPR.net:

The cornerstone of the restructured tax system is a flat-rate of 16 per cent, replacing three income tax bands ranging between 18 and 40 per cent, and a corporate tax previously at 25 per cent.

Tax on share dividends has risen from five to ten per cent, while turnover tax on small businesses has doubled from 1.5 to three per cent.

The changes have two main aims: to simplify a currently Byzantine fiscal system, and to lower the overall tax level so that tax-dodgers have more of an incentive to pay up.

Since tax evasion is almost a national sport, with the underground economy estimated at close to 50 per cent of the whole, tackling it is a major issue for government.

The shake-up also sends a message to the world that Romania is serious about competing for foreign investment. It is taking place in the context of a general regional trend towards lower flat tax rates in Eastern Europe. Now Romania is joining the bandwagon, and at a very competitive level.

Togolese protesters

On Friday, there was a group of protesters identifying itself as the "Demonstration of Togolese Diaspora" in front of the South Loop Post Office. They were singing and carrying signs asking President Bush to help them. I guess they're dissatisfied with the present regime in Togo and are looking for some sort of support from Washington.

UPDATE: Well, I guess they got it. The State Department has cut off all military assistance to Togo and is endorsing sanctions in response to the illegal coup.

What's driving the space race?

I'm wondering to what extent the private space race is actually being driven by demand from private citizens, as most media reports assume. Despite all the starry-eyed dreamers out there, private space tourism is an unlikely market and a very unsafe/risky venture. I am assuming that Paul Allen, Richard Branson, and their kind are doing what they're doing because they expect some kind of return on their investments. The X-Prize was a nice way to recoup some of the development costs for SpaceShipOne, but it is not an end in itself. I suspect the real reasons behind developing manned suborbital/orbital vehicles have more to do with supplying the government with private space services:

1. The Space Shuttle is expensive and unsafe. When it is retired, it will leave a huge void in the US space program (currently being filled by the Russian Soyuz).
2. In 10-15 years, NASA will attempt to make good on the new space vision outlined by Bush. A return to the Moon, especially with construction of a self-sustaining base, will be unlike the Apollo program: no giant rocket blasting the whole project to the moon. The process will be more iterative, requiring many low earth orbit flights.

The space entrepreneurs are sensing the coming privatization of manned spaceflight. Why should the government take on all the political risk and development cost of such a complex program? It's much more efficient to outsource it.

Not so worried about the blog mobs

I've been reading/listening to various reactions to the blog storms over Jordan/Gannon/Rather and I realized something: the blogosphere is not in danger of becoming a lynch mob, simply because it is too self-aware. The blogosphere is insanely introspective - it digests, analyzes, and reacts to any changes in its environment, including itself. I may be anthropomorphizing beyond what is necessary here, but it really is amazing how this mass of blogs acts like a real organism. This network is essentially a self-correction mechanism. This does not mean it won't continue its rampage through MSM-land. But it is aware of it is doing and is somewhat humbled by the realization of its own power. It also realizes that it is not an invincible juggernaut, but will someday be co-opted by the very media it criticises today.

"Great, kid. Don't get cocky!"

The blogosphere got itself another trophy head this week with the resignation of Eason Jordan, head of CNN. Here's the CNN version and the Instapundit version. Now, as jubilant as I am that another liberal media guy just got wiped out, I can't help wondering to where the blogosphere's newfound confidence is leading. I have a bad feeling about some of the triumphalism in blogs (more often, blog comments) after the resignation. I don't think the blogosphere will get burned, in the sense of falling into a trap, since it is too competitive to allow untruths to grow (unlike, say, CBS). I'm worried more about the us vs. them attitude that's developing here, which may lead to hunting down scandals where there aren't any or picking on insignificant, no-name professors. Yes, there are stories of those types that are worth investigating, or even reporting, but it's a matter of focus. As any creature that reponds to pleasure-pain stimulus, the blogosphere will tend to focus on things that give it a pleasant buzz of self-validation. I just hope the blogosphere doesn't become a politics tabloid.

"This deal is getting worse all the time"

Bush is not exactly Lando Calrissian, and Social Security "privatization" will not be exactly private. People will not be able to do what they wish with the money in their "private accounts." They will be limited to a very few "safe" index funds and only be able to rebalance once or twice a year. They will also not be able to withdraw any of it until they retire and then only as annuity payments. So, what's "private" about this?

Not much. But it's still better than the current system. The net change here will be a couple of things:

1. The money is out of the politicians' hands. That people will have a legal right to their social security savings is a huge step. This will force spending restraint in the long term.
2. People can pass on their social security savings to their heirs. Social Security was originally founded as an insurance system, not a savings system. However, as contributions have been forced higher, the government has kept the remainder of Social Security payouts once people die. The new system finally admits what it is: a forced savings program.

It also looks as if taxes may be raised to fund the transition, in the form of higher caps on payroll taxes. There's still a lot of wheeling and dealing going on in Washington over this, so the final form is not set yet. But the fundamental change that Bush wants, that has to happen to save the system from collapsing, is to get the Social Security money out of the politicians' hands. This is the sticking point. It will be interesting to see what kinds of compromises are made to make this happen.

Of course, even though the present reform may not be perfect, nothing prevents better reforms from happening in the future. In fact, the passage of Bush's reforms may finally move Social Security out of "third rail" territory and open it up to further discussion in the future. There are politically strategic considerations here that the critics at Mises, for example, don't seem to appreciate.

A blog about Google

I've started a blog with news and commentary about Google, appropriately called A Blog About Google. Check it out.

Your government at work

From WorldNetDaily (via Business Opportunities):

A Washington state family is about to lose their home after the Department of Labor and Industries hit the father with thousands of dollars in fines for having his underage sons work alongside him in the family business – doing things the state believes are dangerous for young boys.

In 2003, Jude Doty was fined $34,000 by the agency for "employing" his then 11-year-old and 13-year-old sons even though both boys did not fit what Doty says are the criteria for official employment. Later, he was assessed $20,000 for unpaid workers' compensation insurance for his children and other workers, along with $87,000 in penalties.

"Since 1992, I had been moving houses as a general contractor, and as common for self-employed fathers, I found the opportunity to take my boys, and thought nothing strange of it," explains Doty on his website, FamiliesThatWork.org. "I was involved in teaching our children, especially in the faith, and they would accompany me occasionally, from the time they were weaned. We believe that children are a gift from the Lord to the parents, and that we, not the state, have been given the responsibility to train them."

Another problem with Google's model

Tom Foremski at Silicon Valley Watcher finds a potential problem with Google's AdWords model.

Google reports quarterly profits

GOOG gapped up early in the day but sold off considerably as the day wore on. An intraday chart shows two high-volume time periods which pushed the stock down, one early in the day and one later:



I was reading through Google's 10-Q and made some observations:

• Google's rate of revenue growth is declining as it matures: "However, although our revenue growth rate increased in the third quarter of 2004 compared to the second quarter of 2004, our revenue growth rate has generally declined, and we expect it will continue to do so as a result of increasing competition and the inevitable decline in growth rates as our revenues increase to higher levels."
• AdSense accounts for a greater portion of ad revenue in nine months ended 09/30/04 (50%) than in nine months ended 09/30/03 (40%).
• Google expects AdSense revenue growth to be outpaced by AdWords revenue growth: "Although we entered into a significant new AdSense for search agreement in October 2004, the growth in advertising revenues from our Google Network members' web sites is expected to be less than the growth in revenues from our web sites for the foreseeable future."

The key question to how click-fraud will impact Google is where AdSense revenue is heading compared to total revenue. As it stands now, AdSense accounts for an increasing share of total revenue that is levelling off. We'll have to wait and see if this trend continues.

Good click fraud article

Mike Grehan writes (via Battelle):

It has to be said, there are many people in the industry who hold a very cynical view about the amount of time and technology search engines are likely to employ for this type of monitoring.

Let's face it, click fraud is bad news for the advertiser, but it’s still pouring millions into search engine bank accounts.

So, is it feasible that they really would want to put such a concerted effort into something, which effectively, helps them make less money?

In Jake’s case, he presented them with refined data which he’d pulled together himself. Once Google had analysed the data, they got back to him (within five days) and agreed that it was fraudulent activity and agreed to a refund.

I have to say, in my further conversations with both Jessie and Jake, we were all agreed that, as Jake put it "there’s an insane number of PPC advertisers who don’t bother tracking. They don’t bother using unique URLs for monitoring and ROI purposes."

Your overconfidence is your weakness

People usually refer to entrepreneurs as "risk-takers", likening them to gamblers. However, a doctoral student at Wharton says his research shows that entrepreneurs' real motivation is their ego. While they may be as risk-averse (or more so) as the norm, their overconfidence in their abilities leads them to take unconscious risks. I guess Ayn Rand was right, sort of. (From BusinessWeek, via Business Opportunities Weblog),

Lindsey Graham inadvertently stumps Al Gonzales

From the confirmation hearings transcript:

SEN. GRAHAM: Okay. Comment, if you could: Do you believe that a professional military lawyer's opinion that this memo may put our troops in jeopardy under the Uniform Code of Military Justice was a correct opinion? (Pause.)

MR. GONZALES: Would you like me to try to answer that now, Senator, Mr. Chairman?

SEN. SPECTER: Yes, Judge Gonzales, the question is pending.

MR. GONZALES: And the question is do I believe that the military lawyers' judgment that --

SEN. GRAHAM: -- the techniques being espoused in the memo may put our troops at jeopardy under the Uniform Code of Military Justice. (Pause.) And if you don't have -- if you want to look at -- take some time, that's fine.

MR. GONZALES: Thank you, Senator.

SEN. GRAHAM: I mean, that's a very -- I want sometime later for you to answer that question, but you don't have to do it right now.

SEN. SPECTER: If you want to think it over, Judge Gonzales, and respond later --

MR. GONZALES: I do. Thank you, Mr. Chairman.

SEN. SPECTER: -- later during the hearing, that's fine. Senator Feingold.