Link: Trump’s Tariff Plan Leaves Blue-Collar Winners and Losers

“The mills and smelters that supply the raw material, and that would directly benefit from the tariffs, have been shrinking for years. Today, those industries employ fewer than 200,000 people. The companies that buy steel and aluminum, to make everything from trucks to chicken coops, employ more than 6.5 million workers, according to a Heritage Foundation analysis of Commerce Department data.”

Trade is hard.
Original source: Trump’s Tariff Plan Leaves Blue-Collar Winners and Losers

Link: Federal Reserve chair says ‘Amazon effect’ could be responsible for low inflation

‘The “Amazon effect” refers to the decline in traditional retail employment despite expansion in the overall retail sector. That paradox is occurring because of the explosion of online retail, driven in part by Amazon. As online shopping becomes more efficient and widely-used, fewer traditional retail workers are needed. The Amazon theory purports that lower demand for retail labor keeps wages low and holds down the price of consumer goods. But economists are split on the extent to which this phenomenon actually impacts inflation.’
Original source: Federal Reserve chair says ‘Amazon effect’ could be responsible for low inflation

The Bathroom Bill, Texas SB6 – Notebook

As you can imagine, things like the so-called “bathroom bill” drive me crazy. It also makes me sad for whatever happened to my fellow Texans, who support it, that they’d be this cruel, uninformed, and ignorant. And, of course, there’s the people effected.

Stealing some of Matt Ray’s notes for our Software Defined Talk recording, here’s a notebook and highlights on the topic.

  • The Hillbillies are obsessed with bathrooms
    • It’s really depressing how aggressively stupid Texas is sometimes. I don’t blame anyone avoiding it.
    • “The consequences of this bill are beyond severe. Not only can transgender people be arrested and jailed for using the bathroom, but they will be assumed to be pedophiles, and be put on the Texas sexual predator watch list. So not only is there the possibility of being hauled off to jail during a conference, the arrest will ruin the rest of your life. Just because you need to pass some water.”
  • Current status: The bill is having trouble in the Senate, however, part of it is about removing a requirement to provide multi-user bathrooms in schools.
    • More: “The differences on the bathroom bill are substantial. The Senate would require transgender Texans to use the restrooms in publicly owned buildings that match their biological sex and would bar local governments from adopting or maintaining their own laws on the subject. The House version would apply only to elementary and secondary schools; after it passed last weekend, Patrick and others criticized it as a change that does very little.”

How’d it go in North Carolina?

  • AP analysis of economic effect in North Carolina, from March 2017:
    Losses of $313m a year – “$3.76 billion in lost business over a dozen years.”
    Some examples, not just bleeding-heart tech companies: “Those include PayPal canceling a 400-job project in Charlotte, CoStar backing out of negotiations to bring 700-plus jobs to the same area, and Deutsche Bank scuttling a plan for 250 jobs in the Raleigh area. Other companies that backed out include Adidas, which is building its first U.S. sports shoe factory employing 160 near Atlanta rather than a High Point site, and Voxpro, which opted to hire hundreds of customer support workers in Athens, Georgia, rather than the Raleigh area.”
    Most of it is from businesses like Paypal and Deutsche Bank pulling out – good for them!

    • “Bank of America CEO Brian Moynihan — who leads the largest company based in North Carolina — said he’s spoken privately to business leaders who went elsewhere with projects or events because of the controversy, and he fears more decisions like that are being made quietly.”
  • For context, The North Carolina economy: “In 2010 North Carolina’s total gross state product was $424.9 billion. In 2011 the civilian labor force was at around 4.5 million with employment near 4.1 million. The working population is employed across the major employment sectors.”
  • So, rough estimate of economic impact is: a decrease of 0.07%/year (this is a bad number since it’s based on 2010 GDP and other forward looking estimates, however, it gives you a ball-park sense.) However, see scenario for larger impact for the future below (I mean, not to mention being a dick-heads and treating people as subhuman for no good reason other than being fucking social-idiots):

Money and jobs prospects for Texas

  • Back to Texas, the next 10 years are critical for North Texas. Many large, international enterprises are setting up big campuses up there in DFW.
    For example, Toyota relocated their NA headquarters there.

    • For Toyota, this means something on the order of 1,000 new jobs in Texas, with an estimated 2,800 existing employees who’ll move to Texas. That’s a lot of new HEB customers, home buyers, and taxpayers.
  • Now, think of other G2000 companies that would want to move to Texas, or beef up their existing presence. The companies will be deciding what to do in the next 2-3 years, and if they skip on Texas, that will be decades of lost cash, not to mention new Texans.
  • Also, from Texas Association of Business: “The business group released a study last month warning that legislation like the transgender bathroom bill could cost the state economy up to $8.5 billion a year and threaten 185,000 jobs.” (Meanwhile, that organization has “remained neutral.”)

Why in the first place?

  • So, what’s the big deal for those in favor of it in the first place? Well, obviously, the idea that there’s “wide-stances” going on is bunk (more).
  • One can only conclude that supporters are confused (and, thus, afraid): there’s a fundamental disagreement about gender and sexuality. But, also, there’s just downright discriminatory. We’ve lived through this before with the gay marriage movement int he past 20 years and know how to spot veiled discrimination.
  • As one ACLU person put it: “that fundamentally [supporters of bathroom bills] just don’t think of transgender people as humans, and they try to erase trans people from existence.””
  • The Economist describes the people effected: ‘The heart of the bill is its concept of “biological sex”; lawmakers define it as “the physical condition of being male or female, which is stated on a person’s birth certificate”. This definition is fraught for several reasons. First, as many as 1 in 1,500 babies are born with ambiguous genitalia that qualify them as “intersex”, though that designation was only used for the first time last week, when a Brooklyn-born, 55-year-old California resident received a revised birth certificate from New York City in the mail. Second, thousands of the 1.4m transgender Americans have had sex-reassignment surgery, which means that many people who were designated as male or female at birth now have “the physical condition” of being another gender. And for transgender people who retain the biological markers of their original gender identification (because they choose not to undergo surgery or cannot afford it), the fact of their sense of themselves remains. Many transgender women and men feel not only uncomfortable but endangered when being forced to use a bathroom that does not mesh with their identity. In a 2013 paper, Jody Herman, a scholar at the UCLA law school’s Williams Institute, discussed a survey finding that 70% of transgender people “reported being denied access, verbally harassed, or physically assaulted in public restrooms”.’ (More from CNN.)
  • Is there anything to actually worry about? The article continues: “No similar research bears out the theory that opening bathrooms to transgender people spurs sexual predators to put on lipstick and a dress to target women and young girls in public facilities. Last year, a coalition of organisations dedicated to preventing the abuse of women issued a letter addressing Mr Patrick’s worry. “As rape crisis centers, shelters, and other service providers who work each and every day to meet the needs of all survivors and reduce sexual assault and domestic violence throughout society”, they wrote, “we speak from experience and expertise when we state that these claims are false”. Texas Republicans say that strict gender segregation in public bathrooms is “common sense”, but their appeal to conventional wisdom is not borne out by the evidence. A police department official in Des Moines, Iowa, said he doubts that bathroom tolerance for trans people would “encourage” illicit behaviour. Sex offenders, he said, will find victims “no matter what the laws are”.”
  • Meanwhile, bathroom bill thinking shows a misunderstanding of the realities of sexual assault: ‘[Laura Palumbo, communications director at the National Sexual Violence Resource Center] said she believes people “must understand the facts about sexual assault,” adding that in 8 out of 10 cases the victim already knows the person who sexually assaulted them, citing Justice Department statistics. However, 64 percent of transgender people will experience sexual assault in their lifetime, she said, citing a study by the National Gay and Lesbian Task Force and National Center for Transgender Equality.’
  • All of this said, other than “there is no evidence,” it’s surprisingly hard to find any numbers and reports on the topic of “is this actually a problem,” based on past crime and incidents. This is true for both sides of the issues!
  • That said, the conclusion would, thus, be that there’s no evidence based on historics that there’s anything close to a material, actual problem (sexual assault) going on here. This is not only intellectually (and socially) frustrating, but it also means that all the effort spent on bathroom bills is wasted and should have been spent on fixing real problems that could prevent actual sexual assault.

More on “grim” automation – Notebook

A few weeks back my book review of two “the robots are taking over” came out over on The New Stack. Here’s some responses, and also some highlights from a McKinsey piece on automation.

Don’t call it “automation”

From John Allspaw:

There is much more to this topic. Nick Carr’s book, The Glass Cage, has a different perspective. The ramifications of new technology (don’t call it automation) are notoriously difficult to predict, and what we think are forgone conclusions (unemployment of truck drivers even though the tech for self-driving cars needs to see much more diversity of conditions before it can get to the 99%+ accuracy) are not.

Lisanne Bainbridge in her seminal 1983 paper outlines what is still true today.

From that paper:

This paper suggests that the increased interest in human factors among engineers reflects the irony that the more advanced a control system is, so the more crucial may be the contribution of the human operator.

When things go wrong, humans are needed:

To take over and stabilize the process requires manual control skills, to diagnose the fault as a basis for shut down or recovery requires cognitive skills.

But their skills may have deteriorated:

Unfortunately, physical skills deteriorate when they are not used, particularly the refinements of gain and timing. This means that a formerly experienced operator who has been monitoring an automated process may now be an inexperienced one. If he takes over he may set the process into oscillation. He may have to wait for feedback, rather than controlling by open-loop, and it will be difficult for him to interpret whether the feedback shows that there is something wrong with the system or more simply that he has misjudged his control action.

There’s a good case made for not only the need for humans, but to keep humans fully trained and involved in the process to handle errors states.

Hiring not abating

Vinnie, the author of one of the books I reviewed, left a comment on the review, noting:

For the book, I interviewed practitioners in 50 different work settings – accounting, advertising, manufacturing, garbage collection, wineries etc. Each one of them told me where automation is maturing, where it is not, how expensive it is etc. The litmus test to me is are they stopping the hiring of human talent – and I heard NO over and over again even for jobs for which automation tech has been available for decades – UPC scanners in groceries, ATMs in banking, kiosks and bunch of other tech in postal service. So, instead of panicking about catastrophic job losses we should be taking a more gradualist approach and moving people who do repeated tasks all day long and move them into more creative, dexterous work or moving them to other jobs.

I think Avent’s worry is that the approach won’t be gradual and that, as a society, we won’t be able to change norms, laws, and “work” over fast enough.

McKinsey

As more context, check out this overview of their own study and analysis from a 2015 McKinsey Quarterly article:

The jobs don’t disappear, they change:

Our results to date suggest, first and foremost, that a focus on occupations is misleading. Very few occupations will be automated in their entirety in the near or medium term. Rather, certain activities are more likely to be automated, requiring entire business processes to be transformed, and jobs performed by people to be redefined, much like the bank teller’s job was redefined with the advent of ATMs.

Further:

our research suggests that as many as 45 percent of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies… fewer than 5 percent of occupations can be entirely automated using current technology. However, about 60 percent of occupations could have 30 percent or more of their constituent activities automated.

Most work is boring:

Capabilities such as creativity and sensing emotions are core to the human experience and also difficult to automate. The amount of time that workers spend on activities requiring these capabilities, though, appears to be surprisingly low. Just 4 percent of the work activities across the US economy require creativity at a median human level of performance. Similarly, only 29 percent of work activities require a median human level of performance in sensing emotion.

So, as Vinnie also suggests, you can automate all that stuff and have people focus on the “creative” things, e.g.:

Financial advisors, for example, might spend less time analyzing clients’ financial situations, and more time understanding their needs and explaining creative options. Interior designers could spend less time taking measurements, developing illustrations, and ordering materials, and more time developing innovative design concepts based on clients’ desires.

TrumpTech – survey on Joe Six Pack’s sentiment, telco predictions

I didn’t check the legit’ness of the survey, but:

When it comes to tech priorities for the next four years, the general public doesn’t have the same agenda as tech leaders. For example, only 8% of the general public cares about the Internet of Things and only 5% sees 5G development as a priority. STEM education is only a priority for 13%.

What they do care about is security and hacking, particularly of government data (43%) and consumer data (38%). So if Trump’s administration does come into conflict with the social media and cloud giants, he’s going in with the public’s backing.

There’s no majority belief among either the tech elites or the general public that Trump will make the tech industry more innovative than before (42% and 39% respectively). Among the general public, the largest percentage believes that no change is the most likely option (40%), while more tech elites than Joe Six Packs fear stagnation (28% v 21%).

And, labor-wise:

Some 37% of the general public sees technology as a job destroyer for the average American. The sector is accused of bringing in foreign workers to the US by 70% of the general public and of shipping jobs overseas by 60%. (To be fair, the tech elites go along with these two conclusions!) Over half of the general public (56%) believe that US citizens should be given preference for tech jobs.

Meanwhile, one of the outgoing administrators says there’s plenty of tech jobs, just not qualified candidates:

These efforts will founder if there isn’t a continuing supply of qualified recruits, so next up is to increase access to high-quality science, technology, engineering and mathematics (STEM) education. Underlying the importance of education, the OST noted that more than 600,000 high-paying tech jobs went unfilled in the U.S. in 2015, and the number has only grown since.

See also another outgoing letter that encourages continuing programs that ease IT procurement and shared, cloud services like cloud.gov. Seeing how the Truml administrators treat those programs will be a key litmus test. As I alluded to yesterday, these types of programs seem like ideal “do more with less”/”copy the private sector” programs that fit into Trump’s campaign rhetoric. But, hey: hypocracy ¯_(ツ)_/¯

Telco M&A and regulations

Also, see this extensive net-neutrality/telco prediction piece from Caroline Craig.  With more from 451, if you have access

Despite a very activist FCC under President Barack Obama and Wheeler – resulting in stringent net-neutrality and privacy rules, and a pro-competitive view of mergers and acquisitions – US telecom operators recently have been more than willing to push the envelope. Multiple operators have experimented aggressively with zero-rating. Verizon, in particular, has explored the edges of consumer privacy – from its so-called (and abandoned) ‘super cookie’ effort to its ongoing emphasis on mobile advertising, including customer-data-driven ad targeting. While some industry M&A has stalled, AT&T’s surprising bid for Time Warner pushed the boundaries of vertical integration. A Trump administration looks to be much more hands-off, likely accelerating industry M&A and encouraging telecom providers to experiment freely, with the forces of the competitive market (rather than regulators) reining in anti-consumer oversteps. As the mobile market is now constituted – with four highly competitive wireless operators and a slew of cable operators and other disruptors (e.g., Google and new IoT upstarts) ready to leap in – we’re okay with that. No one wants an anti-competitive industry structure or to see consumer privacy exploited, but overly harsh limits can be destructive, too. It’s up to mobile and broadband operators to not abuse their likely new freedoms, and up to their customers (and regulators) to punish them if they do.

Bonus! check out the huge uptick in digital advertising spend this cycle:

As a matter of fact, digital media spending for 2016 political campaigns was projected to top $1 billion, contributing 9.8 percent of media spend. Comparatively, digital spending during the last presidential election season in 2012 was $160 million. 

Link

Keeping money at the top

Given that the wealthiest 10% of Americans own 81% of all stocks and mutual funds, these uses of corporate cash are a direct transfer of corporate profits away from creating jobs and capital investment, increasing income inequality. And the repurchase trend has accelerated radically. Stock buybacks as a percent of capital spending have risen to an all-time high of 113% in the last five years, compared to 60% in 2000 and 38% in 1990.

The $520 billion that companies spent on 2015 stock repurchases alone is enough to pay the average U.S. wage to 11 million workers — considerably more than our 7.8 million citizens who are currently unemployed. To put this in a different perspective, the amount corporations spent on stock repurchases in 2015 that went to the wealthiest 10% of the population was $60 billion more than the total federal government spending on all safety net programs combined.

From How Big Business Created the Politics of Anger, March 2016.

Better get a referral

Referrals account for between 30 and 50% of hires in the US. In a paper published earlier this year, researchers from the Federal Reserve Bank of New York and MIT studied data from a financial services company, and found that while referrals only made up about 6% of total applications, they resulted in more than a quarter of hires. That’s more than the number hired via online job boards, even though those job hunters accounted for 60% of applications and 40% of interviews.
In fact, a referral who gets an interview has a 40% better chance of getting hired than other candidates.

See here.
Better get a referral