Biggest companies pay the least tax, shows new research - <AUTHOR> https://theconversation.com/biggest-companies-pay-the-least-tax-leaving-society-more-vulnerable-to-pandemic-new-research-132143 <comment><USER2> The simple solution is presented here:

[https://cepr.net/book/rigged-how-globalization-and-the- rules...](https://cepr.net/book/rigged-how-globalization-and-the-rules-of-the- modern-economy-were-structured-to-make-the-rich-richer/)

Select a corporate tax rate and require nonvoting shares given to a government fund equivalent to the tax rate percentage of the company. If you buy back shares, you buy back the same percent in government shares. If you give a dividend, it goes to the government fund in the same proportion. If you issue new shares to your executives, the government participates at its rate. For companies like Abbott which return a lot of profits, the people benefit the same way. For companies like amazon, the people continue to own shares in a company that investors think will eventually return those profits.

A large part of trying to hide profits will go away because the shareholders will be incentivized to have proper accounting and the public will benefit.

<comment><USER3> I don't know how this solves anything. Governments can't do everything so companies have incentives to create jobs and produce goods. To solve the issues, you need to incentivize the companies to do what you want. Even if you pass a law like this, companies will offshore their profit making entities which makes this worthless even if it could be passed.

Today, we want stock market growth above all else and that is what we have. People complain Amazon pays no taxes (corporate) but they pay lots of payroll and property taxes and employ tons of others and enable other companies to thrive. This isn't strictly good or bad. We want our 401k going up 20% a year but also want companies to not make profits. These things are interconnected.

<comment><USER4> Amazon's absolute tax burden ain't the only problem.

Every other retailer, employer also pays payroll, property, sales taxes too.

Superior tax avoidance as a competitive advantage is a serious problem. Would Amazon be so dominant today if they had had to play by the same rules as everyone else?

<comment><USER5> There would be some monstrosity anyway. Just like there's just one Google-like search engine, one Facebook-like social network, one LinkedIn-like job- network, etc. Network effects lead to having a very steep distribution between market participants in each sector.

Taxes or no taxes Amazon got big because they relentlessly pursued these effects, and after reaching critical mass, there was not much anyone else could have done.

Now, of course these advantages should be taxed.

<comment><USER6> At least some portion of those network effects are to do with economies of scale as relates to tax avoidance and creative accounting. Levelling the playing field can only increase competition in the marketplace.

<comment><USER5> Just competition is not enough on the long term, some technological change is needed too to push prices down. (If there are a lot of small vendors all just on the verge of bankruptcy that doesn't really help anyone.)

The typical case is small shops in all the cities around the world that are in very efficient markets. For example here anyone can start a hairdressing salon and can employ anyone. No qualifications needed at all. Only the venue has to pass some basic cleanness inspection. Consequently there is no big hairdressing chain, there's not much going on in hairdressing for the past decades. There's not an Amazon of hairdressing, and no one is investing billions into hairdressing R&D to become more profitable. It might change if automation reaches that level.

<comment><USER6> I'm not sure that's true though, If large hairdressing technological advancement was indeed possible then why hasn't somebody done it yet?

It's not like there is any shortage of people pivoting to entirely disrupt new industries when technology allows.

As for whether competition in that market is effective, I find that hairdressing is a great healthy market. No price gouging, plenty of options for the consumer. The price reflects the amount of time of individual attention spent by a trained professional with little to nothing on top. (Don't like your barber? literally just go for a walk and you can probably find a new one)

<comment><USER5> Of course it's possible. You can always do something better, faster, cheaper, with more accuracy, precision, style, etc.

There is R&D in the tools used for hairdressing (scissors, chemicals, hairdriers, chairs, hairwasher chair), just as there is R&D in shaving tools (even if it's just adding one more blade, or using a better battery for electric ones).

Automation will eventually eat the world, why would hairdressing and shaving be the exceptions? Maybe that doesn't count as technological advancement strictly in those fields, but it'll certainly have an effect on those markets.

> If large hairdressing technological advancement was indeed possible then why > hasn't somebody done it yet?

There's always a first. And likely it will come from some unexpected place, enabled by either some very general change (automation) or from some obscure thing.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER7> Imho "companies" should not pay income tax (they can pay sales taxes, asset taxes like property tax, payroll taxes). Companies should be able to retain profits to either reinvest in their business or to save for a downturn. Taxes should be paid by the recipient (shareholders, management) on distributed profits.

I suspect the only reason we have corporate income tax at all is because clever financial engineers find ways to make what is really personal income to shareholders and management look like retained corporate income.

(I would add "windfall taxes" to the set of ok corporate taxes since those aim to redress a monopoly profit situation).

<comment><USER8> "Companies should be able to retain profits to either reinvest in their business or to save for a downturn."

Sure except profits end up as dividends or stock buy back. Companies end up with limited cash and will still need a bail out.

<comment><USER9> Sure, if you eliminate corporate income taxes you'd need to increase capital gains taxes as well. But I am having a hard time seeing the disadvantage of that (although I'm not an expert by any means).

</comment></comment></comment><comment><USER10> Consolidation of our economy has been disastrous. Is this a good argument for a straight revenue tax on companies over a certain market cap? Incentivize then to break themselves up?

E.g. companies over $100b pay a 5% revenue tax. Over $500b pay a 10% revenue tax.

<comment><USER11> "Consolidation of our economy has been disastrous."

Disastrous? Were we better off in the days of Sears and Barnes and Noble? Companies like Walmart with $500 billion in revenue have margins of about 3%. A 10% revenue tax must increase prices, or Walmart would lose money on each transaction.

What you're promoting is a tariff on goods bought from big companies.

Tariffs are bad. They are regressive and anti-consumer

<comment><USER12> Walmart's margins are low, but their employees aren't in great shape. They usually live off of state benefits and presumably have worse education and health outcomes than the average American. What kind of society do we want to be?

<comment><USER11> Walmart pays a minimum of $11 an hour. It's impossible to be on benefits making $11 hour full time unless you are a single mother or disabled. If you tax companies extra for each employee on public benefits, they'll just stop hiring single mothers and disabled people. What kind of society is that where short sighted government policies force the disabled and single mothers into a life poverty?

</comment></comment></comment></comment><comment><USER13> Big companies have more levers to pull.

I'm not sure why everyone gets hung up on the tax number.

Employing people, providing service, all contribute. And if a state sees a deal where they can keep X citizens busy, contributing and Y services for their people, that's part of the aggregate result.

"Taxes" is one of many chips on the table for the deal making.

If there's not a net gain, then don't take the deal.

<comment><USER14> Being _able_ to negotiate (or lobby, or coerce, or bribe -- pick your term) lower taxes does not _justify_ lower taxes.

Economies of scale create value when leveraged to, say, produce more goods with less effort, but they do not create value when they are leveraged in zero sum games against customers, workers, or society.

> If there's not a net gain, then don't take the deal.

The thing about deals is that what happens between deals is always more important than the deal itself. Focusing on the value flow exclusively at the point of exchange is a terrible mistake. Otherwise highway robbery would be a value-creating activity: "Hey, I'm offering you your life in exchange for everything you own, that's a great deal! If you don't like the deal, don't take the deal!"

<comment><USER13> >Being able to negotiate (or lobby, or coerce, or bribe -- pick your term) lower taxes does not justify lower taxes

Agree.

>Economies of scale create value when leveraged to, say, produce more goods with less effort, but they do not create value when they are leveraged in zero sum games against customers, workers, or society.

Both sides have to arrive at a value where it makes sense for them to move forward. Subjective value judgements have to occur.

>"Hey, I'm offering you your life in exchange for everything you own"

Sounds like a bad deal. Don't take it.

</comment></comment></comment><comment><USER15> It's getting tiresome how such seemingly banal headlines are pushing a narrative. Compare this alternative headline: "Small companies pay the most taxes, shows new research." See how that subtle change creates a whole different implication? Written this new way, the feeling is we need to solve the problem of high taxes on small business.

<comment><USER16> Except we don't need to "solve the problem of high taxes on small business". We need to solve the problem of low taxes on big business.

<comment><USER17> More than low taxes the problem should be tax avoidance.

The most simple reason why a big business could pay little taxes would be to be at loss. The intention should be to accurately and reasonably determine a correct measure for loss/income.

</comment></comment></comment><comment><USER18> Amazon pays little tax because of all the losses it posts. One potential explanation for this might be that small cap companies have higher profits than large caps. If that was true they would pay more tax collectively. I have heard before that small caps tend to grow more but are higher-risk, and since there is a selection bias against companies that collapsed last year, I imagine you would find that of the companies paying tax this season small caps would be showing more growth. So, the causal chain I'm proposing would be:

Small caps have higher variance than large caps + Companies that go out of business aren't included in statistics -> Year-end statistics show small caps doing better than large caps.

Then,

Companies that do better on paper pay more tax + Small-caps do better on paper at year end -> small caps pay more tax than large caps.

</comment><comment><USER19> Why is this a surprise to anyone? The bigger the company, the more incentive it has to create a tax-avoidance strategy, and the more resources it has to do so successfully.

Avoiding taxes by legal means, is neither illegal nor immoral.

<comment><USER20> Legality doesn't imply morality, as in this case where avoiding taxes is legal but immoral.

<comment> kube-system I'm just about ready to file my taxes -- which deductions are the immoral ones?

<comment><USER21> Move (on paper) to a country that doesn't tax offshore, then base your company on some island. Have offices in every major city, then send all net income to your offshore company. Make max tax reduction in the countries you operate and get financial aid from the tax money others pay.

<comment> kube-system Avoiding taxes by relocating is not just for big businesses. It's super easy to do today in the golden age of remote work.

Plenty of people have left CA for UT/NV to do the same.

<comment><USER22> But then that's a physical move. Plenty of companies have their executives/leadership in a location that is different from the taxable entity. If all the headquarters and executives physically resided in Caiman islands or Ireland or even Delaware, it would be different.

<comment> kube-system Yes, it's easier for businesses to relocate than people. This is an issue of physicality, not morality. If we drive into the specifics, it's not hard to illustrate that businesses are fundamentally different in nature than people. My point is that tax avoidance is commonplace for individual returns as well.

The solution to all of this is to fix the tax code to represent what we actually intended, not blame those who are following the rules.

Tax is simply math, calling tax avoidance immoral is as silly as calling encryption immoral.

<comment><USER21> It's not like the law makers are unaware of the loop-holes, but by making the rules more complicated you increase the cost of doing business, to the degree that you benefit from economy of scale, meaning the big companies still wins.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER23> This reminds me of the blaring headlines a few years ago that claimed 40% of US corporations paid no income tax. The headlines were true, but not mentioned was that 40% of US corporations lost money that year.

Income tax is based on profits, not gross revenue, not market cap.

<comment><USER24> As a private citizen, I took would like to only pay "income tax" on my profits—the amount of cash I have left over at the end of the year.

Corporations are people too!

/sarc, but only slightly...

<comment><USER25> The secret is that you should incorporate yourself as a business.

</comment></comment></comment><comment><USER26> Aren't there different type of Tax-avoidance? I am not extremely familiar with Amazon, but AFAIK, Amazon invest most of their profits, if not more ( which can be deducted the following year ) into investment for the company. That could be R&D, benefits its employees, etc. And since they made little to no profits, they paid very little tax.

That is perfectly fine to me, especially when Interest rate is ridiculously low it is simpler to borrow than to sit on cash.

Buying Back Stock in order to avoid tax is wrong to me. Especially if they are borrowing money in doing so. Since its incentive is only to its shareholder ( and its executive ) at the expense of Tax. And as far as I know it was illegal pre 1982.

Correct me if I am wrong, but it seems people often mixed up the two.

</comment><comment><USER27> Perhaps the difference is not in the "donations to politicians" that the cynical like to say, but in the "ability to afford expensive tax consultants."

Small companies pay what the government tells them to pay. Big companies hire someone who figures they can save 5% on their taxes by having their factory in Tennessee instead of Kentucky.

It's just the ability (and scale) to afford to employ any advanced tax strategies.

I have friends who live in Hawaii. A high tax state. Another friend moved to Puerto Rico, a low tax one. You don't have to be big to save on taxes.

<comment><USER28> I think that one issue is that there is a significant difference in the ability of a corporation to shop around for favorable differences compared to an individual or small business.

<comment><USER27> Yeah absolutely.

We rarely think that countries are "competitive" with each other when it comes to tax deals and tax rates. But they are.

Just like people shopping around for the best deal on a car, why do we expect companies to NOT shop around for the best deal on taxes?

</comment></comment></comment><comment><USER29> Companies. Don't. Exist.

We made these things up because they are a convenient and useful abstraction, but let's not forget that they are a legal fiction. So guess what you call a company that pays taxes? Fiction! Companies can't pay taxes because they don't exist, only people can pay taxes. So when you tax a company, it ultimately comes from the pocket either of an owner, an employee, a supplier or a customer.

If we were honest about this and not just looking for a boogeyman that we can pretend to stick the bill to, then we'd switch to a conversation about capital gains, income and consumption taxes.

<comment><USER30> Which is all well and good but a group of people organized in a company create an entity that is separate from that of any member or subset of the group. It has its own finances, a collective will, assets, debts, income.

I see no contradiction in taxing companies in a manner generally consistent with that of a person and treating employees of the company as a type of laborer paid by this entity.

Families. Don't. Exist. apparently either. The only fiction is that we anthropomorphize the group like it's singular. That doesn't mean that the group isn't a thing unto itself.

I would hope you don't think of yourself as just a mound of cells.

</comment></comment><comment><USER31> In other news, sky is blue, grass is green, and everything you do online is monitored.

</comment><comment><USER32> The same is true for rich people: you can afford to buy in bulk, to take advantage of special promotions. And sometimes, even when spending more money on products one gets to have better quality on the long run.

<comment><USER33> These aren't remotely related.

Bulk have risks like spoilage or require additional resources like real estate. Or that a quality product isn't really quality.

Taxes are immaterial.

</comment></comment><comment><USER16> No, really? I would've never guessed.

</comment><comment><USER34> their employees are paying plenty though.</comment>


Google phone reboots while making a call - <AUTHOR> http://code.google.com/p/android/issues/detail?id=37485

<comment><USER2> Slightly off topic, but can anyone recommend an android phone that the vendor actually supports properly, isn't chock full of bugs, lasts an entire a day on battery doesn't have some crappy UI on it (like touchwiz) and is built like a Nokia 3310?

I've got a 5 year old Symbian Nokia that is on its last legs and I really don't want to pick a lemon.

<comment><USER3> I doubt you'll find anything built like a 3310 outside of ruggedized phones for construction workers that survive being run over with a bulldozer, and I don't think those are cheap.

<comment><USER2> Something that doesn't die when I drop it once a day would be good enough (even if it is a 3rd party case for something else).

</comment></comment></comment><comment><USER4> Oh the things my Android phone didn't do when calling or receiving a call... it rebooted, froze, missed calls because UI was unresponsive for 2 minutes and you couldn't answer the call...

</comment><comment><USER5> My iPhone has the same problem :(

</comment><comment><USER6> I have a Galaxy Nexus and have never had this issue.

<comment><USER7> My Galaxy Nexus reboots during phone calls about 3 times per month. When it happens, it will usually happen 2-3 times in a row, so it seems to be tickled by something environmental like a network problem.

</comment></comment><comment><USER8> Interesting that nearly all the affected phones seem to have been purchased and used in either Germany or Italy---that may point to a problem with a particular production run. (Also interesting, though unsurprising, that Google has not weighed in on this month-old thread.)

<comment><USER9> why is this unsurprising? (isn't Google usually pretty responsive?)

</comment></comment><comment><USER10> I had this same problem with my Galaxy Nexus. My sim card was really old and after the change and 4.0.4 update now it works great.</comment>


Cybersecurity Firm Finds Way to Alter WhatsApp Messages - <AUTHOR> https://www.nytimes.com/2018/08/07/technology/whatsapp-security-concern.html <comment><USER2> This is because messages can be repudiated, which is definitely intentional and definitely a feature. This author of this article makes it sound like some lame defense and goes into the idea of this being used in the wild like some kind of an attack, but repudiation is an important feature, not a bug.

Even more annoying are these so-called cybersecurity researchers--"Check Point Software"\--claiming "The public relies on the integrity of the message, WhatsApp needs to adjust to prevent this simple manipulation." It definitely makes me embarrassed for my field :/.

<comment><USER3> Check Point is the people who bought Zone Alarm, right?

</comment></comment><comment><USER4> To be clearer, as I understand it you can only manipulate the displayed content of a message you are 'replying' to, not literally the original message.

If you click on the replied to message, it takes you back to the original, so this kind of manipulation is very simple to verify in cases where doing so would be important.

Doesn't seem like a very useful exploit in practice.

<comment><USER5> Yes, it's like editing the quoted text in an email except 1) even easier to check if it was done to you and 2) can't be done with the standard client.

<comment><USER6> In that case calling it an exploit and the author a security researcher is laughter inducing at best! :)

</comment></comment></comment><comment><USER7> Oh! So, whatsapp takes everything from a sender including the previous text. Can't it have as some kind of reference (hash or uuid) since the receiving party already has the original text?

<comment><USER2> Actually, the receiving party might not have the original text, as you might be replying to a message sent before they joined the group.

<comment><USER7> > the receiving party might not have the original text

Sadly, that's why I wouldn't build such a feature (or whatsapp) and remain poor whole of my life.

<comment><USER2> LOL ;P. It just occurred to me there is another even simpler case: the other user also might have cleared their message history since the message was sent. FWIW, I entirely believe you would have discovered these corner cases early in the testing process (were you to have gone ahead and started to build WhatsApp ;P).

</comment></comment></comment></comment><comment><USER8> The article isn't so bad but the headline and "lede" are very misleading, and the journalist presents it as "two sides of the story" instead of trying to understand the level of exaggeration in the "security" researchers' claim.</comment>


LZHAM – Lossless compression with faster decompression than LZMA - <AUTHOR> https://code.google.com/p/lzham/ <comment><USER2> It's strange that they intend for the decompressor to be fast on embedded devices and handhelds, yet give no benchmarks for ARM processors. Instead, they only talk about i7 performance, a chip that you won't find in the target environments.

Does the algorithm run well on ARM?

<comment><USER3> For that matter, does it run well on a modern x64 processor? I'm confused by people who do optimization at this level, but don't distinguish between the different generations of processors. Core i7 is a marketing term corresponding to Intel's positioning of the CPU within the market, but says little about the performance characteristics of the processor.

He mentions later that he's using a "Core i7 970", which is from the Westmere generation that came out in 2010. The decompression speed on the more modern Sandy Bridge, Ivy Bridge, Haswell, or Broadwell chips could be anywhere from the same to 8x better depending on how amenable the algorithm is SIMD improvements.

Without testing it's hard to know, but my guess would be that since it was not consciously designed to take advantage of the newer processor features, it probably will be at the low end of this, and could be beaten handily by an approach that targets only new instruction sets.

</comment></comment><comment><USER4> If you are looking for a fast/realtime lossless compression algorithm, you should prefer lz4 [1] or lzo [2].

Nevertheless, an article comparing the speed and compression efficiency of these algorithms could be interesting.

[1] [https://code.google.com/p/lz4/](https://code.google.com/p/lz4/)

[2] [http://en.wikipedia.org/wiki/Lempel%E2%80%93Ziv%E2%80%93Ober...](http://en.wikipedia.org/wiki/Lempel%E2%80%93Ziv%E2%80%93Oberhumer)

<comment><USER5> There's a link to a table of benchmarks in the description ([http://mattmahoney.net/dc/text.html](http://mattmahoney.net/dc/text.html)). LZ4 still looks a little more compelling than LZHAM in terms of compress/decompress time. It doesn't mention the specific application though (CPU/Disk/etc...).

<comment><USER6> Are you sure it doesn't compare favorably to LZ4? For a small (1.5x) slower decompression speed, the compression factor appears to be substantially better. LZHAM managed to compress the enwiki8 set to 23.80 MiB, and the enwiki9 set to 196.83 MiB.

LZ4, by comparison, had compressed sizes of 40.88 MiB and 362.40 MiB. A database or a Linux distribution using zswap/zram/etc. would be able to store 84% more data in the same amount of memory. For caches, that's huge.

Here are the table rows:

        lzham alpha 3 x64 -m4 -d29                    24,954,329  206,393,809    155,282 x  206,549,091    595     9 4800 LZ77 45
        lz4 v1.2          -c2                         42,870,164  379,999,522     49,128 x  380,048,650     91     6   20 LZ77 26

One trade-off appears to be that lzham often requires a larger dictionary in memory, but it appears that even with smaller dictionary sizes it is appreciably more compact than lz4.

<comment><USER5> That was also one of the things I noticed at a quick glance. It would probably be a fairly big win for anything I/O constrained. I didn't take a look at the data being compressed or the algorithm in detail though.

</comment></comment></comment></comment><comment><USER7> One of the LZMA variants should be added to Chrome/Firefox and others as an optional compression format. Gzip compression ratio is brutally bad compared to the LZMA variants for text and binary compression. It would make a big difference to the web, especially for static but commonly downloaded data.

<comment><USER8> "It would make a big difference to the web, especially for static but commonly downloaded data."

Static but commonly downloaded data is already cached. For downloading software packages, or differential sofware updates (e.g. initializing the dictionary with previously downloaded elements), it would make a lot of sense (basically, the things that are already being done with LZMA getting extra speed).

It will take time to get LZHAM as stable as LZMA. It looks promising, anyway.

<comment><USER7> > Static but commonly downloaded data is already cached.

I was trying to refer to things that are downloaded by a lot of people (such as our 3D scenes here: [https://clara.io/library](https://clara.io/library)), rather than something that is repeatedly downloaded by a single person.

Downloading the data to these 3D scenes is by far the slowest thing and we know that LZMA variants lead to nearly 2x reduction in data transfer.

</comment></comment></comment><comment><USER9> Given that LZMA is the algorithm with the highest compression ratio and lowest speed of all commonly used algorithms, this isn't particularly impressive.

Why is it better than bzip2, or gzip? Both of these are 2-3x faster than LZMA (much more so for gzip --fast) but have lower compression ratios.

LZ4 would be the extreme example of an algorithm even faster than gzip (but with still lower compression ratio).

<comment><USER10> FWIW, from the "Large Text Compression Benchmark" linked from that page:

                    Compression     Compressed size      Decompresser Total size   Time (ns/byte)
      Program           Options      enwik8      enwik9     size (zip)    enwik9+prog  Comp Decomp  Mem Alg Note

      lzham alpha 3 x64 -m4 -d29   24,954,329  206,393,809  155,282 x  206,549,091    595     9 4800 LZ77 45
      gzip 1.3.5        -9         36,445,248  322,591,995   38,801 x  322,630,796    101    17  1.6 LZ77
      bzip2 1.0.2       -9         29,008,736  253,977,839   30,036 x  254,007,875    379   129    8 BWT

Salient point is the decompression time (ns/byte), which is 129 for bzip2, 17 for gzip, and... 9 (!) for lzham. So on that point it blows them out of the water, while still achieving higher compression rate on this type of input. As the original webpage implies, this is perfect for stuff like video games.

<comment><USER11> Is the "Mem" column saying that lzham used 4800 megabytes vs gzip using 1.6 megabytes? If that's so, it makes lzham much less attractive for console and mobile games. If that could be reduced to 8 while still being faster than gzip, then it would be very interesting.

For anyone publishing compression benchmarks: Please, please include memory usage in the report! Very few reports bother to do so at the moment. Meanwhile, many compressors take the assumption that since 16 gigs of RAM is cheap these days, that means using a few extra gigs to get a speedup is totally reasonable. It may be reasonable for you, but it makes the algo useless for me.

<comment><USER12> The mem column is memory used for compression.

</comment></comment></comment></comment><comment><USER13> Would be a good fit for UPX.

<comment><USER14> Isn't UPX pretty fast the way it is right now?

<comment><USER8> Not, if your executable has embeded elements and it takes e.g. 500MB.

<comment><USER14> Out of curiosity, what kind of executable is this? Something generated by HPHPc?

</comment></comment></comment></comment><comment><USER15> How does it compare to LZ4

<comment><USER16> [http://richg42.blogspot.ca/](http://richg42.blogspot.ca/)

Disclosure: I'm probably the only person to release a game that uses LZHAM other than Rich… I chose it because because I needed an LZMA-like compression ratio with a faster decompressor. Performed up to expectations.

<comment><USER17> What is your opinion on this LZ scheme: [http://zola.di.unipi.it/rossano/wp- content/papercite-data/pd...](http://zola.di.unipi.it/rossano/wp- content/papercite-data/pdf/soda14.pdf) which seems to have very good compression effectiveness and decompression time.

<comment><USER18> There's a review of that work here: [http://encode.ru/threads/1903-quot-bi- criteria-quot-data-com...](http://encode.ru/threads/1903-quot-bi-criteria- quot-data-compression?p=41614&viewfull=1#post41614)

</comment></comment></comment></comment><comment><USER19> Let's cut to the chase here... what's the Weissman score?

<comment><USER20> And how does it perform on the 3D video benchmarks?

</comment></comment><comment><USER21> compression 1-3MB/sec

decompresion ~100MB/s

color me unimpressed :(

<comment><USER22> How is a 3x improvement over LZMA not impressive?

</comment></comment><comment><USER23> Glad to see the Pied Piper team's work come to fruition.</comment>


Keurig and InBev move forward with at-home cocktail maker - <AUTHOR> https://www.cnbc.com/2019/03/19/budweisers-parent-and-keurig-move-forward-with-at-home-cocktail-maker.html <comment><AUTHOR> Is it just me or doesn't this seem like a terrible idea? It's wasteful, expensive, limiting, and overly complicated. The pods will only contain tiny amounts of alcohol, too.</comment>


K3c – Classic Docker for a Kubernetes World - <AUTHOR> https://github.com/ibuildthecloud/k3c <comment><USER2> > Fundamentally k3c is a built on the Container Runtime Interface (CRI). In > fact it's really like a nicer version of of cri-tool. CRI doesn't cover > image building and some other small image tasks like tag and push. For image > building Moby's buildkit is used internally, and for other things OCI's > containerd is used.

I have to admit that in the container world I can't keep up with the different standards, what they each cover, and the different implementations of them. I think a non-docker K8s is already possible, this just reuses that stack while reimplementing part of it in order to make the cli more like the docker cli? Maybe despite the description this is actually intended to be used outside of K8s?

<comment><USER3> This tool is intended to be used outside of Kubernetes. Before you can deploy something on Kubernetes you first need to build a container. Docker is the primary tool used for building and developing containers. The intention of k3c is to replace Docker with a smaller tool that has the required parts of Docker that people use for development. And to make that tool more complimentary to the larger k8s ecosystem.

<comment><USER4> I wonder - why `k3c` and not revive `rkt` instead?

<comment><USER3> rkt is really a fundamentally different architecture and approach than Docker, but more importantly a large unmaintained code base. k3c is really a fairly light layer on top of CRI, containerd and buildkit. So the maintenance burden is very low and quality should be high given it's using the same technology as production Kubernetes clusters.

</comment></comment></comment></comment><comment><USER5> It should probably be noted that the "native" experience that Docker Desktop gives MacOS users is a bit of a trickery - Docker needs Linux and so does containerd (used by both k3c and Docker). Needing Linux means needing a VM as a MacOS or Windows user.

Today MacOS users need to revert back to vagrant or to adopt a newer VM- management tool like [https://multipass.run](https://multipass.run) and create a full Linux VM to enjoy tooling k3c from a Mac.

I also ran into this developing a containerd backend for OpenFaaS called faasd - [https://github.com/alexellis/faasd](https://github.com/alexellis/faasd)

We need an experience like Docker Desktop, but for containerd, or for Linux in general on MacOS. Any ideas here Darren?

</comment><comment><USER6> How does this compare with podman, that does work in rootless mode?</comment>


Couldn't sleep. Wrote some code to displays live feed of latest twitpics. - <AUTHOR> http://www.pingwire.com As usual, when your mind races at night, it's tough to sleep. Instead of tossing and turning, I decided to quickly bang out some code using twitter's search API that displays the latest images posted to twitpic.<p>There's probably so many places I could go with this - so, any ideas for enhancements? <comment><USER2> I know it would take away from the "liveness" of it but it would be neat if you could wait for an entire rows worth of images to appear and have a smooth animation that pushed everything down to make room for that new row.

The way each image is added currently is a little "jarring" visually...

Cool though :-)

<comment><USER3> I suggest they fall in groups of four, join together, and disappear :)

<comment><USER4> It's probably pretty difficult to filter but there were some serious NSFW pics coming across my screen there. Just a heads up for anyone else who's still at their office.

<comment><USER5> Speaking of which, my idea was to use the current tech in detecting nude images to create a site like this that ONLY displays the NSFW pics from twitpic.

Lost interest in it though.

<comment><USER6> what tech is that ? I'm very interested in that!

<comment><USER5> There are a lot of academic papers on detecting things like skin-tones, common shapes etc in photos.

Sorry I don't have any links off-hand but search for nude image detector or porn detector etc and you should run into some PDFs.

I remember reading one by google guys about how they implemented the safe search filter for image search. It all comes down to identifying some features of the photo and running in through a trained ANN or SVM.

<comment><USER7> This sounds like a job for Mechanical Turk.

<comment><USER8> Too expensive. Make it a game instead.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER9> I can't see the site (getting 403), but I wrote a live TwitPic viewer for TweetGrid several months ago at <http://tweetgrid.com/twitpicgrid> \- you can filter by search term or hashtag or whatever, or you can just watch the full stream come in.

</comment><comment><USER10> Heh, as I was watching the images go by TwitPic went down. 502 Bad Gateway.

Hope that wasn't your fault ;)

<comment><AUTHOR> I think it was. Twitpic emailed me asking to start caching. I may have killed twitpic.

</comment></comment><comment><USER11> Man, you're crazy ... I can't stop watching. Now I also can't sleep.

</comment><comment><USER12> How much have you made off the ads thus far?

<comment><USER13> Which ads?

<comment><USER14> I had to view the source to figure out what he was talking about. There are Google Ads; I didn't see them either (are you using Adblock Plus, also?).

<comment><USER13> I'm not using Adblock or anything similar (I'm on Safari 4.0.2 on Mac, btw).

I see some code related to google ads in the source but they're not showing on the page.

Maybe the code is just a placeholder.

<comment><USER15> It shows up for me. (OS X 10.5.7, FF 3.5)

<comment><USER13> Now I see them too.

<comment><USER16> It usually takes a view or two for the ad network to "learn" you. This usually happens with smaller networks though, google should know who you are by now (assuming you have been to other adsense enabled sites.)

</comment></comment></comment></comment></comment></comment></comment><comment><USER17> looks like twitpic has shut out requests from pingwire's ip?

<comment><USER6> I think it has to do with a referer check, if you copy the links without referring to pingwire it still works.

Pingwire really is mostly javascript, the site is a simple container to deliver that javascript to your browser which will then do the rest of the work all by itself.

It also seems the block isn't perfect, if you let it run long enough some pictures will make it through.

<comment> brown9-2 Don't think it's referrer based - copying and pasting the URL into a completely seperate browser instance still results in 403s for me.

<comment><USER6> that's weird, it works for me.

(not the image source but the link)

Btw, it's working again.

</comment></comment></comment></comment><comment><USER18> This would be really useful if you could filter by subject (search term or hash tag). It'd be a great way to see pictures of a live conference or news event as it was unfolding (to go along with <http://almost.at/>)

</comment><comment><USER19> Would be nice to have a customizable update timer or a way to slow down the stream.

It appears that some users do not fully grasp the fact that twitter (and related apps) is much more "open" than facebook. Some of the pictures seem pretty private.

</comment><comment><USER20> check out <http://picfog.com>. The 1st of many of this type of thing.

</comment><comment><USER21> Neat -- watch out though, can be NSFW depending on what people are posting.

<comment><USER22> Woah I don't know what I expected when I clicked this link, but definitely not upskirts.

</comment></comment><comment><USER23> Would you mind posting the source code (or emailing it to me)? I'm interested in seeing how you coded it (not to mention structured it). My background in developing web applications is relatively weak.

But if you'd like to keep it to yourself, I can understand...no pressure.

</comment><comment><USER24> Try <http://twitcaps.com> \- More like 3 sleepless nights of work. But, it does support all major Twitter image hosts and allows searches / filters / captures / location aware, etc.

</comment><comment><USER25> That's pretty neat.

However, I can't help asking myself if this real adds any real value to the world. Not that it has to. It's like mental candy. Pleasing, but ultimately lacking in substance.

<comment><USER26> Does everything have to "add real value"?

Anyway, this did add value to the guy who wrote it: He had fun doing it.

I've been thinking a lot about how one can differentiate between art and random shit. Once possibile filter I thought of was: 'Did it make the creator or the audience happy?' But even this doesn't work. Tolstoy disagrees with me on his very first point. <http://www.csulb.edu/~jvancamp/361r14.html>

</comment></comment><comment><USER27> I've just seen Stephen Fry tweet this, and he has 650k~ followers, looks like its gone viral.. not bad for a nights work.

</comment><comment><USER28> Nice! Reminds me of one my friend Ian did: <http://gimmeshiny.com/>

</comment><comment><USER29> In one word - addictive ;<)

</comment><comment><USER30> Looks like twitpic.com is having some problems...

"502 Bad Gateway nginx/0.6.35"

<comment> brown9-2 I'm getting 403 Forbidden's on all requests at this point

</comment></comment><comment><USER31> You guys must not be in North America, because it is 4:25 p.m here.

<comment><AUTHOR> I'm in New York, but I posted it this afternoon from work. There are no guys, it's just me and a little bit of code I wrote in 30 minutes, or 40 minutes tops. I had never seen picfog or any other service - this was just something I wrote because I couldn't sleep.

<comment><USER32> care to teach others the process from start to finish? A tutorial based on something similar would be oh so helpful.

</comment></comment></comment><comment><USER15> I'm seeing the same pics over and over; any idea what that's from?

<comment> a-priori Retweets?

</comment></comment><comment><USER33> Really nice to see a modern (kind of) foundphotos.net

</comment><comment><USER34> release the code!

</comment><comment><USER6> another suggestion, hash on the image, keep a list of the last 100 images, if an image re-appears drop it.

</comment><comment><USER35> It is addictive. Simple, but addictive.

</comment><comment><USER15> What language did you write it in?

</comment><comment><USER36> Nice job.</comment>


Companies Use Borrowed Billions to Buy Back Stock, Not to Invest - <AUTHOR> https://www.bloomberg.com/news/articles/2019-08-08/companies-use-borrowed-billions-to-buy-back-stock-not-to-invest <comment><USER2> > "What's all but vanished is the correlation between how much companies > borrow and how much they invest."

I think the better question is: Under what condition(s) would not investing be a wise and sustainable business decision.

The first answer that comes to mind is: a monopoly. If you dominate your market you have little fear of competition over taking you. You don't need to invest.

The second answer that comes to mind: being a member of a cartel; where competition is feigned for appearances. Again, the need to invest is minimal as normal market forces have been subverted.

<comment><USER3> It seems C-level execs across industries believe buying back stock with profit/debt to unlock performance bonuses is a win-win.

This kind of stupidity is why I'm bearish on Apple. Companies should never prioritize financial engineering over R&D imo.

The company & shareholders will eat the disastrous consequences of this asinine thinking when the market next adjusts 30-60% and everyone realizes they were wasting money buying back stock at all time highs.

<comment><USER4> \- Apple is spending more than ever on research and development.

\- R&D account for 7.9% for its revenue this part quarter.

\- Apple is now on pace to spend $16 billion in R&D in 2019 as it preps for life after iPhone dominance.

[https://www.imore.com/apple-spending-record-amount- research-...](https://www.imore.com/apple-spending-record-amount-research-and- development-it-searches-next-thing)

<comment><USER5> It's actually pretty impressive that they're spending that much on R&D and still manage to make the next product worse than the previous one.

<comment> cuban-frisbee Most of it is likely going to unannounced products like the rumored Apple car and and the rumored AR product.

<comment><USER6> I really don't understand how Apple hasn't used it's cash pile to buy Tesla. It seems like a pretty dam good fit.

<comment><USER7> > I really don't understand how Apple hasn't used it's cash pile to buy Tesla.

All you need to understand is that they haven't. Assuming Apple is still a sound and rational company pursuing a similar line of business, that should speak volumes to you.

<comment><USER8> Apple raising prices on their phones so 1k was probably an irrational choice. It's amazing how they are repeating history of the first time jobs was ejected from apple and they reduced innovation and were on the way to death until he came back and saved them with nextstep.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER9> Capital has been cheap for some time now, since the economic crash in 2008. It has only been since ~2016 that the Federal Funds Rate has lifted above half a percent [0]. And although the rates have recently been increased (Rate recently fell 1/4 of a percent but is still just above 2%), we are still seeing very low rates. Because capital has been relatively easy to acquire for this time I wonder if this is a more a consequence of the obvious but high cost investments already drying up.

Executives have always wanted to drive up metrics as it allows them to move forward in their work, so I would find it doubtful that they wouldn't want to build out their business further if they are able to (More sales is a sure way to make more profits in most cases). If the capital is there, and we know it is, then these business must not see enough demand to expand.

Many would say that buy-backs are a result of a company having excess capital and no sure investments [1]. With the us inflation rate hovering between 1.5 and 3 percent [2], a loan at ~2.25 percent is close to free money.

I personally worry for the economy because of buy-backs. Not because I believe there is anything wrong with the practice, but because I think it indicates that business is general not going well enough to invest back into it.

-0, [https://tradingeconomics.com/united-states/interest-rate](https://tradingeconomics.com/united-states/interest-rate)

-1, [https://www.investopedia.com/ask/answers/040815/what-situati...](https://www.investopedia.com/ask/answers/040815/what-situations-does-it-benefit-company-buy-back-outstanding-shares.asp)

-2, [https://www.usinflationcalculator.com/inflation/current-infl...](https://www.usinflationcalculator.com/inflation/current-inflation-rates/)

<comment><USER10> It sounds like a self-fulfilling prophecy. Businesses return value to shareholders, because they see limited or no opportunity to expand demand. However, 70% of GDP is consumer spending. The benefit of buybacks is largely lost on the middle class, as the top 10% holds 80% of the total market capitalization. [0]

Stock buybacks further reduce the economy's capacity for increasing consumer spending, since the wealthy need roughly the same number of dress shirts and food and washing machines as the rest of us. A marginal dollar isn't meaningful to someone who's already wealthy; they'll save that dollar. But give your average middle class American a dollar and it will lead to increased consumption. Large companies are facing an ever-diminishing base of consumer spending.

[0] [https://www.washingtonpost.com/posteverything/wp/2017/03/02/...](https://www.washingtonpost.com/posteverything/wp/2017/03/02/perspective- on-the-stock-market-rally-80-of-stock-value-held-by-top-10/)

<comment><USER11> Its not in any one businesses self interest to be philanthropic by paying their workers more or slashing their prices to drive up the available consumption of the working class.

It would be the governments responsibility to right the ship, but considering whose lobbyists that have the pen of legislature and ear of congress good luck with that. Too many seats are non-competitive, the propaganda and distraction machines too effective, and the people too ignorant to collectivize.

Eventually the consequences of the constant shaving of productivity away from the workers into the Wall Street black magic money hole will destabilize the country. Not in a French Revolution kind of way, just the slow rotting death that leads to the bottom falling out a la the Soviet Union's collapse. Eventually the thread is drawn taught enough that bread stops showing up in the stores and nobody knows where it went because all the bread companies stopped manufacturing because the marginal returns from the poor by feeding them didn't justify the capital expenditure over playing books and offshoring profits.

Its not even some hypothetical far future happening. The water is already undrinkably contaminated with lead and nobody has the capital to fix it. Shops supplying the lifeblood food of towns just stop getting deliveries. The houses are just left abandoned, the roads rotting, the people just leave with no idea where they are going. Its not uniform, but no collapse ever is, but nobody accounts for it or really even seems to care.

<comment><USER10> > Its not in any one businesses self interest to be philanthropic by paying > their workers more or slashing their prices to drive up the available > consumption of the working class.

Tragedy of the commons, I suppose. All large business want a slice of consumer spending, but if they don't support consumers, there is no consumer spending to capture.

> Eventually the thread is drawn taught enough that bread stops showing up in > the stores and nobody knows where it went because all the bread companies > stopped manufacturing because the marginal returns from the poor by feeding > them didn't justify the capital expenditure over playing books and > offshoring profits.

I hope things don't get that bad. I'm all for the idea of motivating people with money. Some inequality is a good thing. But too much inequality is a disservice to everybody: widespread food instability in the country with the highest number of guns per capita would be a national security crisis that even the wealthy could not ignore. I hope we act with some foresight. We have plenty of distance between here and that point. But I do wonder what level of inequality this country will sustain before things become slightly more egalitarian.

</comment></comment></comment></comment><comment><USER12> So many comments here along the lines of "So what, they're making an efficient use of capital." That's missing the point. So much of the argument behind the 2017 tax cuts and the Fed's low interest rates was that they would spur _real_ investment (that is, investment which increases productive capacity or improves productivity) that would benefit everyone, mainly through jobs. If all this extra money is just resulting in a more tax-efficient way for companies to give money to their shareholders, which in reality is a small slice of the populace, highly skewed towards the wealthy, it's certainly worth it to call bullshit that these governmental moves that everyone ends up paying for only end up benefiting the wealthy.

<comment><USER13> > So much of the argument behind the 2017 tax cuts and the Fed's low interest > rates was that they would spur real investment (that is, investment which > increases productive capacity or improves productivity) that would benefit > everyone, mainly through jobs.

Sure. Do we have any reason to think that's not working? When an investor makes a successful investment, and the company becomes very profitable and has spare cash they can't find a productive use for, and give it back to the original investors...

...what do you think the investor is going to do with it?

1) Look for another good investment (something they have a track record for doing)

2) Pile the money up in a big pile and have a bonfire, as they literally have no other ideas for what to do with the money.

3) Something else?

1 is the obvious answer, yet you seem to be the answer must be 2 and can't possibly be 1, but you provide no reason to think so, the linked article provides no reason to think so, and you don't even seem to have realised 1 is a possible outcome.

Further, you seem to be implicitly assuming that a company management who are not professional investors and who don't think they can find a good use for the money will still do a better job of making investments than the firm's investors, who are. Is there a reason for this?

<comment><USER14> Much of the money isn't going to other investments. It goes to savings. The top 1% save ~40% of their income. The bottom 90% save 4% of their income. The problem with giving money to the wealthy is that it doesn't go to startups, it leaves the economy and increases a number on someone's terminal. The best way to spur economic growth is to give money to people who will spend it quickly whether rich or poor. In general, it turns out most very wealthy people have little incentive to spend money quickly. Instead, they save to hedge against and profit from recessions. Your option 2) isn't some foolish strategy, it's literally what is happening. Some of the money goes to investments and the rest seeks to hedge against the risk of those investments.

I really don't understand how people still push some version of trickle-down economics. Corporate buybacks are exactly this. Using taxpayer money to fund it only hurts the long term value of the economy.

<comment><USER15> > Much of the money isn't going to other investments. It goes to savings.

This is nonsense. Saving in a bank expands the bank's ability to lend. Saving in treasury bonds finances government operations. Saving in the stock market provides the incentive for VCs to invest in startups. Saving in municipal or corporate bonds finances the leveraged operations of those entities, contributing to better long-term planning. Saving in gold at least turns the money over to someone else who will probably spend it on something more useful than gold. For the most part, saving _is_ investment. Only in niche scenarios does saved money leave the money supply.

<comment><USER16> While investment and savings aren't opposites, they also aren't guaranteed to be linked, at least if by investment you mean "increase in productive capacity" rather than an accounting identity in some macroeconomic models.

Increasing a bank's ability to lend doesn't mean they will necessarily do it; the reserve ratio is an upper bound.

Also, even when they do make a loan, it also doesn't mean it will necessarily go towards building or improving productive assets. Sometimes loans go towards buying existing assets (such as houses) in a way that might just result in asset inflation. (As in, for example, stock buybacks.)

The idea of a "global savings glut" is somewhat controversial but not obviously nonsense. We can't learn anything by defining it away.

<comment><USER17> Buying existing assets only results in asset inflation if you lack a free market.

Otherwise, buying existing assets (such as houses) will increase the price which will trigger increased production of that asset.

</comment></comment></comment></comment></comment></comment><comment><USER18> Yeah, we know.

Good arguments for taxing dividends, stock buybacks, and interest paid at the same rate. They're all paying for capital. The tax preference of debt creates a debt-heavy financial system.

Some countries prohibit stock buybacks. How's that working out?

To prohibit buybacks and make it stick, you also have to prohibit cross- ownership. The US used to do that, but only for utility companies. The Utility Holding Company Act (1935-2005) limited utility ownership structure to a tree depth of 3 with no backlinks. This allowed regulators to track where the money and ownership were.

<comment><USER19> Yes the key is to stop taxing capital gains and dividends at different rates. Interestingly here in Australia any company tax paid is passed through to the shareholders as a tax credit. This not only encourages companies to pay tax, but it encourages companies to pay dividends rather than buy back shares.

The price of gold suggests even buy backs are coming to an end of their effectiveness. There is so much money now sloshing around that nobody has any idea what to do with it.

<comment><USER20> In the US, long term capital gains and qualified dividends (which is most of them) are _already_ taxed at the same rate.

<comment><USER18> Interest paid, though, is not. Which gives debt a tax edge over equity.

<comment><USER21> But banks are taxed on their net interest margin at the corporate tax rate. Its the same argument as for the 'dividend tax credit' system which Australia has and the UK had 20+ years ago (which used to be called 'Advance Corporation Tax'), ie tax capital returns only once and in the hands of the investor not the payer where possible.

</comment></comment></comment></comment></comment><comment><USER22> And? The investors receive these billions in cash for the stock they sell, and they'll invest in other companies directly, instead of having that megaholding company do acquisitions.

<comment><USER23> > _The investors receive these billions in cash for the stock they sell, and > they 'll invest in other companies directly, instead of having that > megaholding company do acquisitions._

That's a really appealing supposition (seriously), in part because the inherent diversification spreads the risk. And there's also the factor that more cash in the shareholders' pockets could mean more job-producing economic demand generally, even if the shareholders just spent the money on yachts and mansions.

But there's an empirical question: Is that what actually happens in the real world — or do the shareholders just hoard the money, taking it out of circulation without either investing it or using it to create more demand?

<comment><USER15> > or do the shareholders just hoard the money, taking it out of circulation > without either investing it or using it to create more demand?

Hoard as in like, under a mattress? No. Investors keep pretty much all of their money invested pretty much all of the time, or the banks that they store their money in do by proxy.

<comment><USER23> > _Investors keep pretty much all of their money invested pretty much all of > the time, or the banks that they store their money in do by proxy._

That's only true when banks actually lend. In the wake of the Great Recession, however, many banks drastically cut back on their lending — and to that extent they were no more than giant virtual mattresses into which their depositors' money was stuffed. As a Federal Reserve official said in 2015 about the Great Recession's aftermath: "... the sharper decline in outstanding bank loans to businesses that I mentioned earlier was likely a contributing factor to the slower economic recovery we have observed this time around." [0]

[0] [https://www.bis.org/review/r150417b.pdf](https://www.bis.org/review/r150417b.pdf)

</comment></comment></comment></comment><comment><USER24> In the 21st century, I am increasingly convinced one of the biggest problems with capitalism is that entities with large amounts of cash (corporations or individuals) are just sloshing it around pointlessly instead of investing it in actually beneficial things. Maybe central banks should try the forbidden "helicopter money". I'm sure the average person would actually spend money they get on improving their lives.

<comment><USER25> Don't be deceived by the appearence of cash. IT is not paper money that makes goods and services exist: burning a bill of paper does not impoverish society, and neither does putting it under the mattress.

</comment></comment><comment><USER26> Buying your own stock is like returning money to shareholders. It's effectively a dividend, by raising the stock price by the same amount they use to buy back stock.

Like if they use $1 billion to buy back stock, the aggregate value of the outstanding stock should go up by $1 billion. Doesn't matter if they borrowed the money, the company retains the value.

Having a high company value must have some benefits to them in other ways. Perhaps even less negative news articles in the press, and an easier time hiring good employees, just to name two.

<comment><USER27> _the aggregate value of the outstanding stock should go up by $1 billion_

This isn't quite right. Look at it this way:

There is a company that has the following assets

      1) $100 in cash
      2) $100 in other assets

There are 200 outstanding shares, so each share is worth $1.

The company spends its $100 in cash to buy back 100 shares. So now its asset list is:

      1) $100 in other assets

But there are now only 100 shares outstanding so each one is still worth $1.

So why do a buyback if it doesn't raise the share price? Two reasons:

      1) it returns cash to the shareholders who want it (those that sell the stock)
      2) future gains in value will now accrue to fewer shares of outstanding stock

<comment><USER28> Love your example, but to throw this aspect in, the market doesn't always "value" companies the same way.

Therefore, in your above example if the shares were actually being sold at $2 each, then the company is doing a disservice to the investors by buying the stock back.

However, if the stock is under pressure (below its "fair" price), say 50 cents in the above example, then by buying the stock back, you are creating true value for your investors.

Problem of course is that rarely do people running the company think this way.

<comment><USER29> > However, if the stock is under pressure (below its "fair" price), say 50 > cents in the above example, then by buying the stock back, you are creating > true value for your investors.

Which means that your company just gambles its money at the stock market by betting on its own price.

</comment></comment></comment></comment><comment> 1e-9 The central theme of this article does not appear to be well supported by the data presented. I interpret the scatter plot a bit differently they did:

1) The average amount of corporate borrowing as a share of total assets appears remarkably consistent over the last 66 years.

2) The average amount of capital expenditures as a share of total assets appears to be have been declining at a roughly consistent rate for 66 years.

3) The data does not appear to support any firm conclusions regarding changes to the correlation between capital expenditures and borrowing, which was the main topic of the article. The slopes of those regression lines are highly suspect given the amount of data and the outliers in later years. Certainly, there is nothing in the presented data suggesting a change over the last 17 years, much less the last 2 years.

It would have been nice to see some of the raw data or the statistical analysis, but clearly that is for a different audience than what they were targeting.

</comment><comment><USER30> I always find it interesting when the same story (not link, but actual story) makes the front page of both Hackernews and Zerohedge. Here is the version from the latter: [1]. It doesn't happen very often, but when it does it's usually something of consequence, so I think there may be some signal here.

[1] [https://www.zerohedge.com/news/2019-08-10/do-investors- reali...](https://www.zerohedge.com/news/2019-08-10/do-investors-realize-how- much-risk-theyre-taking)

Edit: I entirely concur with the concerns about ZH, but the observation that buybacks are being used to juice EPS is a good and informative one.

<comment><USER31> I used to read zero hedge a lot, but then they started getting a bit extreme with the "down with the establishment" theme and I stopped reading which is a bit of a shame cause they do have some good analysis. You sublimaly get influenced by all the propaganda-esque rhetoric until you can't distinguish the good analysis from conspiracy and consequently miss the entire bull market

</comment></comment><comment><USER32> Good discussion. Buybacks are also investments. The problem is that all the low interest printed money and tax breaks are circulating among the same people/families that own assets in the first place.

The trickle down isn't happening because every single printed dollar and every single tax break is making more money circulate among the rich/asset owners.

That's also the reason yields are low. That's also the reason Softbank can raise so much. That's also the reason nurses and teachers and firefighters and factory workers aren't making enough. Whatever trickles down to them is spent back as income for corporations. They don't have assets.

</comment><comment><USER33> Most people miss that this is a way to move money without paying taxes. If you pay to onshore profits, you can avoid taxes until another tax holiday by taking out a loan, paying minimal interest, and avoiding having to onshore money for a long time.

</comment><comment><USER34> If a company is very good at making X, it may not be very good at making anything else. Hence, returning the money via stock buybacks to investors is likely a better strategy than doing a crummy job doing something outside their core competency.

<comment><USER35> Tell that to the slide rule companies...

</comment></comment><comment><USER36> Based Outlays of U.S. Corporations, we can see their at an all time high. But, the chart, as far as i know is not inflation adjusted, so it's likely not as steep as indicated.

honest question: does anyone have a reading on how sustainable this practice is? Surely, there must be some calculation you can do. Take the aggregate amount of capital (cash holdings) of all the companies and graph it, along with their ability to borrow more funds. If that graph is going super down and the cash outlay is going super up, then surely it means we're heading for a crash, right?

</comment><comment><USER37> I'd rather receive profits from my investments in capital gains than in dividends. I pay more in taxes on dividends, and lose the opportunity to time my profits.

Since I'm buy-and-hold, the dividends get reinvested anyway, but can creating more paperwork as each reinvestment is another purchase.

As a non-American with US-stock holdings, the IRS withholds taxes on dividends (15% for me), while I owe no local taxes because the holdings are in a tax- free account.

<comment><USER8> There's also no reason cap gains should be taxed less. It's just another way that wealthy have screwed the tax system. It's little different than allowing stock buybacks. Those actually used to be illegal - until 1982. [https://www.forbes.com/sites/aalsin/2017/02/28/shareholders-...](https://www.forbes.com/sites/aalsin/2017/02/28/shareholders- should-be-required-to-vote-on-stock-buybacks/#7c9518ea6b1e)

</comment></comment><comment><USER38> Honest question, why do (some) public companies distribute dividends? Why instead of increasing the wages or investing in the future of the company you just burn cash in a way that may or may not help the stock price of the company (which is just pure massive speculation of the market players to begin with)?

<comment><USER39> Suppose you follow your argument to the conclusion, and no companies issue dividends. What is the point of owning a share of a company then?

<comment><USER38> People happily own Amazon/FB/Alphabet stock with no dividend payments.

<comment><USER39> They don't (currently) issue dividends because the expectation is they will buy back their stock or will issue dividends in the future.

If a company never issued dividends and never bought back their own stock, then there would be no reason for investors to buy stocks in the first place. Most investors don't invest out of the goodness of their hearts, they invest to get a return on capital.

<comment><USER40> Berkshire Hathaway doesn't pay dividends and most probably never will.

<comment><USER41> But they have bought their own stock back and they are even considering a whopping $100 billion dollar buyback [0].

[0]: [https://qz.com/1611997/warren-buffett-hints-on-timing-of- big...](https://qz.com/1611997/warren-buffett-hints-on-timing-of-big- berkshire-hathaway-buyback/)

</comment></comment></comment></comment></comment></comment><comment><USER42> I'm curious. Isn't buyback a kind of investment in yourself?

If you think that stock of your company is undervalued in the market, wouldn't it be reasonable that you would buyback your own stock? This can be seen as correct allocation of capital. Am I not seeing something?

<comment><USER43> Well the main argument is that the politicians want companies to invest from the tax cuts into more jobs.

Where as companies, in reality, are just doing buy back which reward shareholders.

Whether buy back is an investment or not is up to whoever definition's and I guess can be up for debate. But I think it derail the main point which is tax cuts and low federal rates aren't incentivizing companies into investing but instead buyback.

</comment></comment><comment><USER44> Money is fungible. When a company buys back shares owned by an equity mutual fund, the fund uses the cash to buy shares of other companies, including the shares of IPOs, if the manager thinks they are good investments.

</comment><comment><USER45> I was under the impression that purchasing stocks was an investment (i.e. an investment into your own company). Seems like there can be instances in which that can be favorable to everyone involved.

<comment><USER45> I am not sure why this was down-voted. Am I in error? If so, please explain how.

</comment></comment><comment><USER46> If it's a good thing to own stocks for a person, why would it be bad for a corporation?

</comment><comment><USER47> This is old news. Actually, it is very old signal that is lost in the noise that is generated to distract. Company execs and Wall St. do this to enrich themselves at the expense of pretty much everyone else. It's the same old socialism for the rich, transference of gains to the few (now), risks and costs (later) to the many. Just distract the masses with politics. Seems to work better very year. Will never change until the red and blue little stop fighting and realize they are both being played. Come together, people. Or at least open your eyes, think for yourselves, stop parroting the talking points coming from your side, instead question them. Do that for the talking points from the other side. What do you see? Sorry, little buzzed and ranting incoherently unless you are on the same wavelength. What's the frequency, Kenneth?

</comment><comment><USER48> Have P/E ratios been rising?

Stock prices have likely risen thanks to the buy backs. Have earnings increased proportionally?

</comment><comment><USER49> So what. Use whatever money you have to put yourself into a more favourable position. Isnt that the whole way weve set this up?

<comment><USER50> The argument isn't that the companies are necessarily doing the wrong thing for shareholders, but that cheap money is not spurring investment in capital equipment, R&D, etc., which is a change from what historically happened. The opinion of some people quoted in the article (not all) is that this lack of investment is bad for the economy long-term.

</comment></comment><comment><USER51> Another distortion and subversion of capitalism by central banks. They are either stupid and naive, or colluding in the channeling of newly printed money directly into executives' pockets.

Sometimes before, and inevitably after, their stint at the Fed/BoE/BoJ/ECB, they will be executives at those same companies, or the banks that take a cut of the transaction (print, repo, bond, equity, option - rinse, repeat).

If those same CBs lose control and rates rise, and/or business turns down and margins decrease, those bonds will still be due, even when the shares they replaced would have fallen without any obligation. The company credit rating decreases. As they pass the BBB event horizon to a junk black hole, most fiduciary holders of those bonds will have to sell, thus accelerating the crash in corporate bonds as they all turn to junk and spreads blow out.

So CBs turn robust capitalism into brittle cronyism.

</comment><comment><USER52> Very strange that this article comes from bloomberg, you would think they would understand business a bit better.

<comment><USER53> " _Please don 't post shallow dismissals, especially of other people's work. A good critical comment teaches us something._"

[https://news.ycombinator.com/newsguidelines.html](https://news.ycombinator.com/newsguidelines.html)

</comment></comment><comment><USER54> We just need for that wealth to trickle down. Any day now..

<comment><USER55> [https://www.nytimes.com/2019/05/02/business/economy/wage- gro...](https://www.nytimes.com/2019/05/02/business/economy/wage-growth- economy.html)

</comment></comment><comment> rv-de the interesting question is why did the government cut taxes promoting investments despite knowing companies would but back stocks. this was an obvious outcome.

<comment><USER56> >why did the government cut taxes

What do you think?

</comment></comment><comment><USER57> Stock buy backs lead to higher market concentrations. That's the biggest economic impact of the past 5-7 years from cheap money afforded to large AND profitable corporations.

<comment><USER58> > Stock buy backs lead to higher market concentrations.

Compared to what? If Apple, for example, had not spent billions in buybacks and had done something else with that money its market cap would be higher today so the market would be more concentrated.

</comment></comment><comment><USER59> Yet they need more tax breaks so the wealth trickles down to the... shareholders? No. We need to invest in infrastructure and research so that companies have places to invest in. Share buybacks are just propping the economy up until assets blow up.

<comment><USER60> Who exactly is calling for tax breaks for the wealthy?

The fact they do it doesn't mean the people were calling for it. A "Trickle down" tax system isn't in any economics textbook or taught/debated in economics courses.

<comment><USER59> Somehow it seems to have happened in a huge way every time a republican is in office though. It's not like politicians respond to the people, they respond to their donors.

<comment><USER60> Even then it's rarely the actual goal of the policy either. It's usually a side effect that gets packed in to wider reductions. "Trickle down" as a concept is a political invention.

The disconnect between real-life economics and policy isn't limited to just that either. Just like how all the private equity businesses were the first to be brought in front of congress immediately after the 2008 financial crisis because everyone wanted to blame them (they wanted to blame "neo" Gordon Gekko corporate raiders for all the problems, but quickly discovered all the LBO firms out-performed the market and had invested in companies which would have stagnated or died otherwise). Yet they ended up being the few firms who could had the LBO capital market not existed). In the end much of the capital for the bailouts the Obama administration used came from the same group they wanted to blame.

Then a bunch of new rules got put in place which only solidifier the stranglehold the top-5 banks had as the smaller banks could never have survived had they met the capital and oversight requirements.

</comment></comment></comment></comment><comment><USER61> HN is probably the only place I regularly visit on the internet where a large portion of the regular user base will passionately defend these kind of practices. It makes sense, a lot of people here have vested interest in these kind of corporations.

<comment><USER62> It's kind of amazing, really. Maybe because I'm middle class in a third world country, but I'm always dumfounded with the argument that "actually, rich people having _more_ money is good for everyone".

</comment></comment><comment><USER63> This trend of borrowing money to buy your own stock reeks of market manipulation.

Corporate debt to gdp is at a record high, and they're funneling the money into stock buybacks and dividends. I don't know why this isn't of interest to the other commentors here.

The stock market has been eerily predictable and calm for the last few years, and I think this is why. The game is to lull investors into a false sense of confidence that the market _never_ falls beyond the scope of a few weeks or so.

To the low information investor, everything looks great, and also when there are a lot of low information investors in the market, stock buybacks tend to increase the price.

<comment><USER16> Suppose there are two profitable companies. One returns profits to investors with a regular dividend. The other spends a similar amount of money on share buybacks.

Fundamentally, they are both good companies to buy for similar reasons. Unless something changes to make the company unprofitable, both could continue doing this indefinitely.

They both make the stock price harder to interpret, but for different reasons. In theory the price of a stock that pays a good dividend should be a sawtooth curve - it drops when the dividend happens. Chartists have it hard. What else is new?

The low-information investor probably shouldn't be watching the price at all. They should either buy an index fund or be doing buy-and-hold. So this doesn't affect them.

<comment><USER63> We're not talking about profits here. Companies are _borrowing_ money to buy back their own shares. And this trend continues to accelerate. Debt to GDP is at an all time high right now.

An index fund, or someone who is buying-and-holding would have the exact same effect.

The company makes a bid on it's own shares, and regardless if you are doing a buy-and-hold, or investing in an index fund, or a low information investor, you are not selling, even if the share price passes their inherit value.

The point I'm making is this gives corporations an easy way to keep their stock prices stable and rising, without having to perform. This attracts more investors, which raises the price even further until it's way past what is should be valued at.

If it keeps going like this, eventually the whole stock market will become way overpriced (a bubble) and crash like we've never seen before.

<comment><USER16> It's true that if they keep borrowing, eventually they will borrow too much.

But I would guess CFO's know that. They may not be _right_ about what's a sustainable level of debt, but they probably think there is a limit and not go past that.

I speculated more about this here: [https://news.ycombinator.com/item?id=20666217](https://news.ycombinator.com/item?id=20666217)

<comment><USER63> You can call it a "service to bondholders" but just because a company does something doesn't mean its profitable and there isn't much profit in this, as far as I can see.

It's like if you had 6 people who owned a pizza restaurant and one of them was the CEO. One day he calls a meeting and says, "Great news! I went to the bank to take out a loan, and paid Bob and Fred to buy their shares out. Now, as long as we continue to make a profit, we'll each make 50% more on our investment, the only catch is we have this debt hanging over our heads, and have to pay interest on that. Of course, if we start to lose money, your investment will lose out 50% quicker, but we won't talk about that. Also, I had to pay Bob and Fred enough that, in their opinion, it was more profitable to take the cash than own the company."

The only thing this does for the investor is make their investment more volatile. It's the same effect as if you opened an account at a brokerage, bought one stock, and took out margin so you could own more shares. Only the company is basically forcing you to take on margin in this way.

It's possible that it may make sense in some situations to do this, but given that it's so popular, I think the real reason is slight of hand.

The EPS goes up and the stock price goes up to a premium compared to the rest of the market. Take anybody that's not doing their DD, by either using a system, such as "dogs of the dow", or buying an index fund or simply choosing stocks at random. If you can sell your stock at a higher price, you make more money per share sold, and since these investors basically can't tell shit from shinola, you might as well sell them at the shittiest price you can manage.

If what I'm thinking is true, its somewhat hilarious that common wisdom is index funds and systems like "dogs of the dow" are commonly espoused as the best investments for new investors.

</comment></comment></comment></comment></comment><comment><USER64> Corporate raiders have been doing this for years. They have also forced companies to increase the dividend. It's an easy way to make it seem like profits are rising so the stock goes up. They don't care because they will exit the stock as soon as they can make a profit.

The problem is that the companies never progress and eventually they lose their ability to compete. If it's a tech company it will eventually get beaten by another more nimble company. We have seen this over and over again. A good example is IBM. They've lost their ability to compete and have had to settle on servicing the customers that are still using older technologies like mainframes. Their niche is still profitable but don't expect IBM to be a powerhouse again.

Buying stock is financial engineering that's used to goose the stock price short term but does nothing to keep the company competitive over time.</comment>


Like Sports, Startups Have Leagues - <AUTHOR> http://scalablestartup.berkeley.edu/2013/10/01/like-sports-startups-have-leagues/

<comment><USER2> This question presents a very false dichotomy: "Is the startup world a meritocracy, or are there leagues in startups?"

If we are making a sports analogy, then having different leagues does NOT imply that it is not a meritocracy. The very best (judged from merit) end up in the top leagues. Sports is the ULTIMATE meritocracy, in fact, because there is a simple and fair way to judge who is better.

Leagues just form so that that similarly talented people face each other in fair competition.

<comment><AUTHOR> Perhaps the BCS is a great analogy: there is a seemingly fair competition but luck, tradition and money sure help you get into the championship game.

<comment><USER2> Ah yes, the most unsporting system in sports!

</comment></comment></comment><comment><USER3> I have to at least somewhat agree with the article. I'm on the outside looking in, and to me it looks almost like working in the Federal Government, how once you're in then "you're in" for life with the Big League Startups.

Startups love to talk about their work as extremely technically challenging when in reality the developers I know who work at startups are generally no better or working on no harder problems than people not working at startups or working at startups that aren't very well known or 'in the big leagues'.

I think it really has to deal with the mentors the startups end up with and the funding, and together these help the "Big League" startups continuously be successful. Also, startups that are invested in by places like YCombinator naturally get more press and their business will have a higher chance for success (when combined with excellent mentors)....

You're free to disagree or correct me if I have any obvious misconceptions...Like I said..I'm on the outside looking in.

</comment><comment><USER4> Hard to argue with this post. It really breaks out the "everyone can start a company" myth into something I've been trying to explain for a while.

The analogy I've been working with is comparing startups to the mid 2000s Poker boom - once the internet made it easier for anyone to play competitive poker, more and more people started doing it. Once one "regular guy" \- Chris Moneymaker - won the WSOP and ESPN televised the hell out of it, poker rooms were flooded.

But who did you see still sitting back there taking in this new money? The same old guys who had been grinding out livings on the card table for years. The same guys you see regularly placing in the top 20 at WSOP events around the occasional flash in the pan newbies who get a hot streak.

<comment><AUTHOR> It is really odd to think of the skill development it takes to be in the top 20 of poker, or your niche league. Does this have anything to do with 10k hours of development time or being built as a 6'9" athlete (or the intellectual, or drive equivalent).

</comment></comment><comment><USER5> You don't know what league you're in until you try. With sports, it's relatively easy to see why someone isn't a pro player - startup founders are harder to judge. In fact, judging the potential league of a startup is such a hard problem that even VCs, who are in the business of making such judgements, have to make a lot of rather unsafe bets.

How's a person to know they're not good enough? Should everyone who doesn't come into the game already rich and well-connected just stay away?

<comment><USER3> I don't think you're right. Even in professional sports, bad scouting reports happen just like when VCs make the wrong call.

Sometimes a persons particular skill-set scales really well at the next level and scouts and VCs may not expect that (Tom Brady 6th round pick versus a VC who says wow I wish I invested in ____).

Sometimes a persons particular skill-set looks like they will play really well in the big leagues but they never really do, or a well-funded startup never really gets traction for whatever reason.

I think the sports to startup analogy might actually be quite good.

<comment><USER5> Okay, so while you disagree with me and the article about the sports analogy, you seemingly still agree with me about startups (which was the central point of my post).

</comment></comment></comment><comment><USER6> The saddest thing about the little tech world we live in, the one only WE care about, is that somehow seemingly smart people have managed to convince themselves that 1)this is a zero sum game, 2) you need rock star _any /everything_ (what ever that means).

<comment><USER7> It is a zero-sum game if you're hiring.

</comment></comment><comment><USER8> I can't stand reading posts like this anymore on HN. The title is literally the entire article.

Who knew the harder you work the more successful you are? I wish there were some sort of hypothesis. Grouping startups together, identifying what's unique/different, talking about founders, etc.

<comment><AUTHOR> The point of the article is the notion that you might not be able to graduate to another league by effort.

<comment><USER8> So this article introduced me to the concept of luck? Ok..

<comment><USER9> Not necessarily luck. Innate skill is another option.</comment></comment></comment></comment>


How Mexican heroin cartels are targeting small-town America - <AUTHOR> http://www.washingtonpost.com/sf/national/2015/09/24/pellets-planes-and-the-new-frontier <comment><USER3> I read the Washington Post comments and am discouraged. I read the HN comments - here where I see evidence of higher than average reason and compassion - <USER2> am depressed.

First, if you believe that the crack down on prescription narcotics have first and foremost hurt addicts, you're very mistaken. Addicts easily moved on to heroin, as this piece shows. People with cancer and debilitating nerve disorders like chronic shingles, CPRS, trigeminal neuralgia, and some kinds of neuropathy, who total over a million in the U.S. alone, are the ones who have suffered greatly even though opiate painkillers are safe and effective when used correctly. These are the kinds of diseases than make grown men cry in pain and bring on suicidal thoughts in previously happy, non-depressed individuals (I know, I've seen it up close).

Second, if you believe that the US can some how magically win the drug war by cracking down on the southern border, I have a bridge to sell you. Drug smugglers come in by boat to Washington State, by plane across Canada to Montana, and by submarine into the Florida coast. Wasting billions building some "impregnable" fence across our southern border will only increase the number of smugglers coming in from our other borders. And then what? We shut down all our borders?

Seriously, when I read these comments coming from HN, bastion of rational thought, I just want to curl up in a corner and cry.

<comment><USER4> As a physician, I find comments like this disturbing. Barring special circumstances (cancer related pain), there is almost no need for chronic opiates. In fact, the body rapidly becomes accustomed to opiates and will require higher and higher doses that can become dangerous. The united states uses orders of magnitude more opiates than all other countries, and that often comes from potentially a cultural aversion to pain, but also many patients specifically seek out and ask for pain meds.

In fact, the scenarios you mention, of post herpetic neuralgia, trigeminal neuralgia, and neuropathy should NEVER be treated with opiates. There are highly effective neuroleptics and medications like carbamazepine, gabapentin, and TCAs that are first line and highly effective for these syndromes. While painful, given that it is neuropathic pain, often with rapid onset and offset, opiates, even PRN medication, is not appropriate management and does not help with its treatment. Adjuvant therapy including topical creams like capsaicin as well as minor procedures like nerve blocks and injections are pursued if first line treatments do not work. Often I see people in clinic who were aggressive about opiates and got opiates for these syndromes and spiral into addiction and problems while the underlying problem is untreated.

Opiates are not a panacea for all pain, and its troubling with patients see it that way, and often insist on opiate medications.

<comment><USER3> > The united states uses orders of magnitude more opiates than all other > countries,

[https://en.wikipedia.org/wiki/List_of_countries_by_prevalenc...](https://en.wikipedia.org/wiki/List_of_countries_by_prevalence_of_opiates_use)

</comment></comment></comment><comment><USER5> I can see no reason why heroin and opioid maintenance clinics can't exist in every decent sized city in the USA.

People go in, receive a clean injection of unadulterated drug from a medical professional, have access to counselors and job recruiters, etc.

Requiring a payment for the dose to make the clinic self-sustaining can still create availability that far undercuts the cartels. Or, through donors, it can be provided for free.

People who are seriously addicted will no longer need to steal to feed their habits. The cartels will lose their best source of income. And very, very few people are going to go to a heroin clinic to use heroin for the first time.

"Hey man, what do you want to do this weekend?"

"Well, I was thinking of going to the clinic and claiming to be a heroin addict. I've always wanted to try that."

<comment><USER6> Ugh, I'll just continue to buy drugs on the black market and use them at home. No one wants to go lay in a hospital bed after shooting up. Addicts can safely manage their own addictions, if they are provided consistent doses and clean needles.

Legalize it, tax it, and use the proceeds of the taxation for needle exchanges and rehab clinics.

<comment><USER7> Legalizing will undoubtedly increase usage, unless you can find another way to keep on the pressure. The reason why usage levels are what they are right now is because there is pressure against using it.

<comment><USER8> People who use drugs do not factor in potential punitive measures when using/beginning to use let alone addicts. "Pressure" doesn't matter one bit.

<comment><USER7> Yes they will factor in. That's disingenuous. Forget whose side of the debate you and I are in. Let's analyze the fundamental consequence of your assertion here.

If I held a gun to a drug addict's head, you think that will not pressure them to stop, even if just for that moment when the pressure is applied?

If your assertion is true, with any degree of correctness, then we've found a perfect way to destroy information! Simply convert data into a signal fed to a drug addict. Because you're asserting that drug addicts can destroy such information since regardless of what signal they're fed, they will destroy the information.

<comment><USER8> Well I did say "potential punitive measures" which I thought would make it obvious I meant legal punitive measures. Last time I checked holding a gun to a drug addict's head to achieve a change in that addict is not only illegal but highly unethical.

Pressure, as I took it, meant legal methods of affecting change. And even so, widespread violence against addict's and their families certainly didn't eradicate the problem for China. Today there are around 4-5 million drug users in China and yet that country has laws allowing for the death penalty for trafficking and very stringent use laws.

And certainly putting a gun to someone's head is definitely not a long term solution to addiction but rather a very cruel way of incentivizing treatment.

</comment></comment></comment></comment></comment></comment><comment><USER9> This is a really sad story of how America is failing the middle class. Ohio used to be a major manufacturing hub - no longer. Now there are more deaths from heroin overdose in Ohio than car crashes. It started with the widespread accessibility of Oxycontin, then after the reformulation, heroin.

Chicago is the major importing hub for drugs - hence all the violence - and it fans out from there. We have no border security in the south, and people wonder how the drugs get in. The US is not powerless to stop any of this, but we need to admit we have a serious problem and start implementing solutions.

<comment><USER10> The downfall of American industry and manufacturing didn't start with "the widespread accessibility of Oxycontin". It started with the Globalization movement, where poorly-paid foreign labor was combined with then-decreasing costs of global shipping.

Since when is Chicago a major hub for importing drugs? What's your source? From where are they imported and how - air? Why do you tangent to border security?

<comment><USER9> El Chapo is the head of the sinaloa cartel:

"Chicago, home of the Mercantile Exchange, has always been a hub from which legitimate goods fan out across the country, and it's no different for black- market commodities. Chapo has used the city as a clearinghouse since the early 1990s; he once described it as his "home port.""

[http://www.nytimes.com/2012/06/17/magazine/how-a-mexican- dru...](http://www.nytimes.com/2012/06/17/magazine/how-a-mexican-drug-cartel- makes-its-billions.html?_r=0)

"Chicago is a major trafficking route for Mexican cartels and has become a hub for the distribution of heroin across the Midwest. The dangerous result has been an increase in heroin overdose deaths in Illinois."

[http://www.wbez.org/news/heroin-its-cheap-its-available- and-...](http://www.wbez.org/news/heroin-its-cheap-its-available-and-its- dangerous-business-109304)

It's a border security issue because the drugs are coming from the south, by gangs that can operate across the border almost unchallenged.

</comment></comment></comment><comment><USER11> The article uses terms like "epidemic," but the map graphic suggests a national mortality rate of around 2.5 per 100,000. That's 0.0025%, or 7,500 people per year.

<comment><USER12> NIH/NIDA supports that number: [https://d14rmgtrwzf5a.cloudfront.net/sites/default/files/cdc...](https://d14rmgtrwzf5a.cloudfront.net/sites/default/files/cdcwonder2015_5.jpg)

From 2001 to 2013 there was a 5-fold increase in the total number of deaths from heroin overdose.

Edit: I believe a 500% increase in overdose deaths qualifies under the 'epidemic' definition of "a sudden, widespread occurrence of a particular undesirable phenomenon."

<comment><USER3> So if there a rare disease increases 500% from a few to a few dozen, does that count as an outbreak?

</comment></comment></comment><comment><USER13> This is a symptom of a bigger problem. Plain and simple. Lack of opportunity and sense of purpose in modern society, combined with a person who has had a few bad rolls of the dice (And statistically someone will roll bad) along with a genetic predisposition for it. You may not care about that 100iq drug additive, but what about the potential genius offspring--where one can change the world.

</comment><comment><USER14> Heroin is fueled by gateway drugs, particularly oxycodone and vikodin. This story just shows how the market will evolve to overcome barriers to sell a profitable product in a restricted market.

<comment><USER15> It's sad the DEA would rather watch people die in the street from heroin overdoses than just ease up on the prescription opiates.

Surely it's preferable to enable junkies than kill them and feed the cartels?

<comment><USER16> people die in large numbers from overdoses from prescription opiates too - easing access to prescription opiates is a terrible solution

<comment><USER17> >people die in large numbers from overdoses from prescription opiates too

What's your evidence for this?

<comment><USER18> "Prescription drug abuse and addiction kill far more people in the U.S. every year than all illegal drugs combined."

[https://www.psychologytoday.com/blog/wicked- deeds/201404/pre...](https://www.psychologytoday.com/blog/wicked- deeds/201404/prescription-drugs-are-more-deadly-street-drugs)

<comment><USER15> This is a meaningless argument if you don't normalize for usage rates. Many times more people are on legal drugs than illegal drugs. I doubt OxyContin kills a higher _percentage_ of its users than heroin.

<comment><USER3> Also surveillance bias is a problem in these data.

Also, these data include things like acetaminophen overdoses (estimates run from 100 to 1000 deaths per year).

<comment><USER19> Those overdoses could still be secondary to opioid addiction; there are lots of APAP/hydrocodone and APAP/oxycodone out there.</comment></comment></comment></comment></comment></comment></comment></comment>