Lyft lobbying to prevent Portland from regulating impact of ride-sharing - <AUTHOR> https://humantransit.org/2019/02/lyft-lobbying-to-keep-cities-from-governing-themselves.html <comment><USER2> Honestly, I would much prefer everything get regulated at state level.

I live in NJ. There are 565 municipalities here. Every single one has different regulations. For example, if one were to pick up a prearranged regular fare from Terminal A at EWR (Newark Liberty International), they might not know that this terminal is in the City of Elizabeth. The city sometimes has plainclothes detectives write $783 tickets. For prearranged pickups by non-airport taxi, not solicitation.

Uber and Lyft got regulated under a statewide 'rideshare' law here. Townships and cities can't ticket them for doing pickups. Taxis have to know all the regulation of every municipality they operate in. In the above example, Elizabeth wrote a ton of tickets for rideshare drivers before the statewide framework into effect.

I'm aware large cities provide unique challenges and can understand why NYC for instance should be allowed to regulate their own taxi/livery situation, but for the rest of the state it doesn't make sense to have every little town have different regulations.

Edit: Seems someone did write a petition that even covers the nuance of allowing some larger municipalities a little oversight [https://www.change.org/p/new-jersey-governor-help-the- taxi-i...](https://www.change.org/p/new-jersey-governor-help-the-taxi- industry-taxicab-crisis-in-new-jersey-legislation-needs-to-be-changed)

<comment><USER3> Echoing you concern and somehow related: in Germany it is almost impossible to get state of the art software infrastructure on the road for customers of public transit because of the fragmentation of transportation providers. Municipalities run their own systems and while not all of them are actively sabotaging attempts at increased coherence, none of them has any incentive to increase coherence either.

If it weren't for the state-run federal railway system, that runs also commuter railways in all German cities (and thus can enforce pressure) I reckon there would even be no software to calculate a ride from one end of the country to the other. And there would certainly be no product like the BahnCard, were you can use all of Germany's public transit for ~4.200 € / year.

<comment><USER4> Japan has bunch of different rail providers that run parts of the network. I wonder how the interoperability problems are solved over there.

<comment><USER5> Well, sure. But long distances are usually covered by Shinkansen, and shorter distances are often covered by one of the regional JRs. All of these are supported by JRS ([https://www.jrs.co.jp/english/](https://www.jrs.co.jp/english/)) which run IT and the railway information services. You only need to buy one ticket for a JR trip even though several companies may be operating the trains you use.

For more local service, there are also private railways and various metro systems. They sometimes have agreements to allow transfers between them, like the two Tokyo subways. So if you are going to use two different subway systems in Tokyo, you buy a transfer ticket and have to pass through a gate in the middle of your trip to transfer to the other system.

<comment><USER6> _They sometimes have agreements to allow transfers between them, like the two Tokyo subways._

That's a pretty gross understatement.

There are more than a dozen companies operating public transport systems in Tokyo alone and it's all interconnected. They don't only seemlessly interconnect (via PASMO or SWICA smart cards), but they also share common designators for their station labellings.

 _So if you are going to use two different subway systems in Tokyo, you buy a transfer ticket and have to pass through a gate in the middle of your trip to transfer to the other system._

I remeber exactly that. But that was around the year 2000, where it was really difficult to use public transport without a guide as a foreigner. Today, with a smart card, consistent and unique labelling of every station, regardless who operates it, and all ticket machines talking perfect English it's a breeze.

<comment><USER7> >There are more than a dozen companies operating public transport systems in Tokyo alone and it's all interconnected. They don't only seemlessly interconnect (via PASMO or SWICA smart cards), but they also share common designators for their station labellings.

Perhaps they are more culturally motivated to present customers with the best experience unlike trying to fleece customers for every dime in America. Just saying.

There's a chance if you don't integrate your transit with the other guy, they may pay more to use yours and spend 2 hours traveling. Win!

</comment></comment></comment></comment></comment></comment><comment><USER8> Of interest to HN.

 _Specifically, the bill Lyft has proposed and is attempting to pass would eliminate the ability of every Oregon city from taking the following common sense steps to protect TNC passengers:

       ...
       - Collecting local data, which is critical for understanding congestion and climate impacts.
       ...

_

TNC providers are not eager to reveal any more of their data than they have to, for reasons of proprietary advantage. Similarly they understandably don't want to take on the operational cost of having to comply with many local requirements. (I work in data at a tech company; I can sympathize with their point of view.)

Yet if urban mobility ultimately becomes a good provided by tech monopolies, we want to make sure local governments are in on the loop with respect to the knowledge and data those companies have, and have some leverage to enforce local requirements.

Applications to current issues regarding privacy regulation, antitrust and tech monopolies, and the potential rollout of autonomous vehicles are left as an exercise for the reader.

Also, recommended: "Inside the Transportation Data Tug of War" \- [https://www.move-forward.com/inside-the-transportation- data-...](https://www.move-forward.com/inside-the-transportation-data-tug-of- war/)

</comment><comment><USER9> I've complained about this here before after Uber and Lyft did the same thing in Texas ([https://www.austinchronicle.com/daily/news/2017-03-14/lege-f...](https://www.austinchronicle.com/daily/news/2017-03-14/lege- for-sale/)), states certainly have an interest in legislative preemption when there's a good and prevailing cause for it, I won't argue the legal merits there, but I think this warrants serious consideration beyond the surface when voters (as was the case in Austin) decide on municipal code and business effectively 'buy' preemption or else threaten to take their ball and go home ([https://www.austinchronicle.com/news/2016-05-13/our-city- our...](https://www.austinchronicle.com/news/2016-05-13/our-city-our- headache/)).

<comment><USER10> Shouldn't legislation be more reactive than preemptive? Isn't the Uber/Lyft worst case scenario that traffic gets a little worse?

<comment><USER11> The worst case scenario is also that fixed rate, lottery availability taxi is completely replaced by highest bidder availability.

Depending on your value system, this can be a good, or a bad thing.

<comment><USER12> That's only how it works in theory. No city actually has a blinded lottery system for equitable pickups. In practice, drivers just discriminate on who looks likely to tip more when demand is hot, and this is very hard to police.

Price controls rarely have this ideal outcome.

</comment></comment></comment></comment><comment><USER13> Calling Portland "dense" is hysterical.

As a Portlander, I can say we are a terrible example of what NIMBYism does to efforts to lower housing costs by adding density.

Our city has a decent public transit setup and if the focus was on adding usable density with improved transit options, rather than people trying to protect neighborhoods, we'd be much better off.

I am fine with Lyft wanting this regulated at the state level. It seems like a weird hill to die on for Portland.

<comment><USER12> "Less dense than than optimal" does not imply "density effects don't matter for city management as claimed in the letter [eg for scarcity of road capacity or pickup points]".

<comment><USER13> Well, the city has done very little to move density forward. They continue to approve buildings that are mostly overpriced, poorly built, studio apartments.

The other problem is that the commute pattern in Portland isn't into downtown only. There are people who commute from the east side of town, through downtown, through the tunnel (or one of the other limited transit options over the hills) to Beaverton or Hillsboro to work at Nike, Intel, etc. The efficient public transit options for that commute simply don't exist. It can take 1.5+ hours to do that via MAX and bus.

<comment><USER12> Which, I agree, are important issues, but don't obviate the mayor's reference to municipalities' need to manage the problems of density (rather than be overridden by voters that don't encounter such problems).

</comment></comment></comment></comment><comment><USER14> If America's urban areas were good at "geometry" they wouldn't have so much parking and such shitty transit.

</comment><comment><USER15> I feel like every state should mandate accessible data similar to Taiwan's approach ([https://data.cdc.gov.tw/en/](https://data.cdc.gov.tw/en/)). New York has a similar program but does not have the hackathon or incentives for people to use the data.

</comment><comment><USER16> Color me naive, but I'm always confused why those troubled by the lobbying criticize the influencers instead of the influenced. The influenced aren't some innocent party here. Surely it is more reasonable to act in the best interest of your company as a lobbyist than it is to act against your constituents as a politician. Where is the scathing letter directed towards the writers/signatories/supporters of the bill in question? The reason you see this one is simple PR as a city lobbies for their way at the state level just as Lyft lobbies and they know anti-big-company is an effective tactic.

If the city of Portland has a problem with the state of Oregon, then that's where the politicians need to hash out their issues.

> Specifically, the bill Lyft has proposed and is attempting to pass [...]

Lulz...what kind of terrible spin is that. I would be ashamed if I voted for this guy. Lyft doesn't pass laws.

<comment><USER17> > I'm always confused why those troubled by the lobbying criticize the > influencers instead of the influenced.

Bribery tends to be a crime because we haven't found a way to short circuit _en masse_ the human tendency to submit to influence.

> Lulz...what kind of terrible spin is that. I would be ashamed if I voted for > this guy. Lyft doesn't pass laws.

Considering your comment, I shouldn't be surprised that you would be dismissive of the idea that directing influence means exerting greater control over the legislative process; it's only the technicalities (i.e. Lyft is not a legislator) that differ. The statement holds, and I think many of us would appreciate a more dignified rebuttal to the article's point rather than "lulz."

<comment><USER18> > Bribery tends to be a crime because we haven't found a way to short circuit > en masse the human tendency to submit to influence

Contrary to popular belief, lobbying and bribery are in fact not the same thing.

<comment><USER10> What's the difference?

<comment><USER18> Seriously? Lobbyists are paid to talk to politicians. They represent interest groups, and make their case in DC and other places. They do make campaign contributions, but that does not represent anywhere near the same level of influence as an actual person to person, quid pro quo bribe. There are actual places in the world where bribery is rampant, and if you lived in one of those places, you really wouldn't need to ask this question.

<comment><USER19> Local level bribery might not take the same forms that it takes in other countries, but the top level bribery is easy to see. We have massively expensive elections that are used to direct money towards a massively expensive system of 'election contractors' all of whom were elected officials at some point that now receive dark money via this system.

Of course, compared to our lobbying system, where people like Joe Lieberman now work, taking money to inform other elected officials that if they play the game right, they'll also make millions from corporations 'lobbying' the government. They'll help to make sure that you have a long career with lots of attention by funding your campaigns.

Lobbying sounds great, but like many things, we've perverted it.

<comment><USER18> Don't get me wrong. I'm not saying lobbying is great. I'm merely trying to keep some perspective that lobbying, while not ideal, is still much better than actual bribery.

</comment></comment></comment></comment></comment></comment></comment><comment><USER20> Really odd comment sentiments here. I fail to see how this is a good thing as opposed to alarming.

</comment><comment><USER21> Many of the bullet points are somewhat vague, but one is strangely specific:

> Prohibiting companies from charging passengers with disabilities higher > prices during busy times.

First of all, what constitutes 'disability'?

How will passengers identify themselves as 'disabled' to the apps?

How would the companies store this highly private information? (think medical- info grade, not credit-card grade)

What will indemnify the companies from claims of discrimination, claims possible in light of the companies being aware of users' disabilities, information they never wanted to keep in the first place?

And finally, not to make it the main topic, but who would pay for this? That "surge pricing" you pay is, in turn, being paid to the drivers. The drivers are "chasing the surge'.

<comment><USER22> I would assume the definition of disabled at play here is related to the equipment of the car e.g. wheelchair lift, or service required e.g. driver getting out of the car to help someone in or out of the car.

<comment><USER21> So it's not a status but just a per ride assessment -- if you appear disabled when the driver comes to pick you up, he should ask not to receive surge pay for that particular ride?

</comment></comment></comment><comment><USER23> How is Lyft different from any taxi service?

<comment><USER24> Because its much better, and so attracts more people to the service.

Uber has a great potential to be used as public transport, with dynamic route pathing based on supply and demand. Something traditional public transport could never do.

<comment><USER25> Uber is a disaster as public transit. It's functionally little different than just having everyone drive themselves. Not needing parking is a big benefit, but it's still a bad idea.

<comment><USER24> It is functionally very different because:

-You dont have to drive around and find a park (less congestion and real estate)

-You can pool your trip with another user (Uber Pool)

</comment></comment></comment></comment><comment><USER26> It's worth noting: as much as a low-quality source like this frames their headline as if devolving control to local government is an unalloyed good, the interplay between the policy of nested polities (eg city, state, federal) is a much more complex issue, and one that people come down on the other side of fairly often (as a simple, dramatic example, the repeal of Roe v Wade is considered to be a nightmare scenario for many here, and yet it's precisely a case of federal law restricting the ability of local govts under the aegis of protecting individual rights[1]).

I'm not expressing approval or disapproval of Lyft's actions, but I think it's worth pointing out what a low-quality source this is, given its reliance on leaning into the reader's biases right from the headline. Low-effort advocacy like this is almost never the best way to understand a topic, just as a libertarian think tank's hypothetical "Lyft protects consumers from authoritarian local govt's" headline wouldn't be.

[1] I know this is a complicated issue and I'm really not interested in getting arguing it on its merits; it's just a convenient, widely-recognized example that takes the jurisdictional form I'm describing here.

<comment><USER6> What exactly is low quality about the source? Apart from the fact that Mr. Walker is without question an expert in public transport most of the blog post reprints a letter from the city of Portland outlining Lyft's dirty tacticts.

The actual blog entry simply outlines the different requirements between dense - and suburban city areas.

Your comment, smearing the original poster, seems to me vile and totally beyond the point.

<comment><USER27> Repeatedly stating that only city folk can understand a city is uh... rather divisive and insults the reader's intelligence.

<comment><USER28> But that's not what the author wrote in context. He is pointing out that representatives from rural and suburban areas propose regulations and laws that benefit those types of areas and are often directly opposite of what people in a dense area need or want.

That's not being insulting; that's the expected outcome. People should advocate for what is suitable for the area where they live. (What that happens to be and how to implement it is always up for debate.) But for a representative of a rural or suburban area to insist that a city have the same rules as--and no more than--a rural area is not feasible.

That's what the author was getting at within the context of those two paragraphs. It's also the push/pull dynamic of cities and rural/suburban areas that's been going on in state governments since time immemorial.

</comment></comment></comment></comment><comment><USER29> It seems like the tldr of Portland's objections is that rideshare services result in a net increase of cars on the road-- the rideshare cars-- because it makes taking a cab more convenient than mass transit. But it seems like an inverse effect might offset this issue: fewer people choosing to own & drive their personal vehicles because it's now more convenient to use rideshare services an not have to worry about finding & paying for parking.

<comment><USER30> burst traffic vs constant traffic, where burst can be defined as commute times.

you can see the affect in downtown Portland, where car traffic was mostly concentrated to burst hours with the rest of traffic being a relative trickle of vehicles that weren't delivery or transit vehicles. now, it's a constant stream of lyft/uber labeled cars at all hours, in addition the the burst hours. anecdotally, no passengers most of the time (around 70%), seeming to be between fares.

</comment></comment><comment><USER31> The HN crowd has always been hypocritical when bashing Uber but praising Lyft. They are the same kind of crooks.

</comment><comment><USER32> ITT there seems to be a lot of sentiment that city/county local governments shouldn't be able to implement policy on anything but the most trivial matters. As if politicians and corporations residing in other cities are better suited to make impactful local policy. I dont get it...

Then again I am still scathing from a similar case study in my home town of San Diego, with Airbnb. Our city council passed some policies to regulate whole-home short term vacation rentals in residential areas. It limited whole- home short-term Airbnb/VRBO rentals to 6-months per year (you could still rent out a spare room or granny flat on Airbnb as much as you want).

Airbnb wasn't having it. They hired a gazillion signature gatherers to brute force a public ballot measure. I'm talking about a signature gathering army; they were such a presence/nuisance it led to absurdities like Trader Joe's filing a lawsuit against Airbnb [1].

To be clear, Airbnb is killing San Diego's local renter market. Over the last 5 years, thousands of rental properties have been converted to short-term Airbnb rentals. These images speak for themselves: [https://imgur.com/a/UBJYbwr](https://imgur.com/a/UBJYbwr)

This is on the heels of an independent consulting firm warning that sd housing and rental prices are rising at an alarming rate, and F grade in new housing development (blame SANDAG?), and single-family home prices slipping out of reach of median income earners (further saturating the apartment rental market) [2].

The natural reaction was SD locals filling town-hall meetings for several solid months, demanding city council take action (it was a sight to behold, because, I mean, when do you ever hear your friends say 'I just got back from a town hall meeting?'). And they did. And everyone cheered.

And then a week later it was all over.

The funny thing is; it won't even be a ballot measure. Airbnb understood that if they got the minimum number of signatures, they could force san diego city council to either (1) rescind the policies they just passed and start over on new policy more favorable to Airbnb - it had to be since laws require resubmissions after a petition to be _substantially_ different; or (2) no policy whatsoever, until a formal ballot measure could be put in front of voters (i.e. 2+ years of no policy & airbnb propaganda).

TLDR; a silicon valley company has more sustained influence on san diego rental/housing policy than san diego elected officials

1\. [https://www.fastcompany.com/90231150/trader-joes-has- filed-a...](https://www.fastcompany.com/90231150/trader-joes-has-filed-a- restraining-order-against-airbnb)

2\. [http://londonmoeder.com/wp- content/uploads/2018/06/Regional-...](http://londonmoeder.com/wp- content/uploads/2018/06/Regional-Housing-Study-San-Diego-County-Final.pdf)

<comment><USER33> Or to put it another way, San Diego property-holders now have more control over what they do with their property than San Diego elected officials.

<comment><USER32> Right, if only that were true.

It's a bigger pain-in-the-ass to run a property as an STR compared to renting to some local on a yearly lease, since tenant turnover always requires a variety of owner/prop-manager/property interactions (cleaning, fixing stuff, finding the right seasonal listing price, interacting with people unfamiliar with the area, and a big issue of dealing with 'vacationer' collateral damage: trashed apartment, pissed-off neighbors, etc.).

That final hurdle (the 'pain-in-the-ass bottleneck') is almost completely mitigated in the current manifestation of Airbnb. We are at a tipping point where corporations buy dozens, hundreds, of residential properties and automate the entire STR process. Vacationers book online, they show up at the STR and punch-in a pin code to open the front door (no need to shake anyone's hand), vacationers stay for a few days, leave the STR in whatever state of affairs, later that day some contracted cleaning staff shows up and cleans the mess, washes the sheets etc, and resets the door-lock on the way out. Voilà, fully automated STR. Rinse, repeat. And the more STRs the corporation owns in a city, the lower the overhead cost per unit.

Here is one such company... Sonder.

[https://www.sonder.com/destinations/san_diego/search?ne=32.8...](https://www.sonder.com/destinations/san_diego/search?ne=32.87694%2C-117.08127&sw=32.674009%2C-117.285917)

If you take a look at the map of their San Diego offerings, you'll see a bunch of pins on the map with numbers like <9>, <12>, <14>, up to <27> it seems. But if you look closely, that doesn't mean they own 27 total apartments in San Diego, that number means they own 27 apartments/lofts under that single pin. Sonder is a Silicon Valley based company, waddayaknow.

</comment></comment></comment><comment><USER34> I've seen the effect of San Francisco "governing itself". In many respects, I would rather they didn't.

"Governing itself" isn't some magical good. The cost of incompatible laws in jurisdictions can be large and invisible. Since the legislature ignores the cost of laws, they are encouraged to complicate things as much as possible.

I'm on Lyft's side here.

<comment><USER35> You want corporate interests to rule a city? That's not even remotely democratic.

<comment><USER36> _" Governing itself" isn't some magical good_

I don't think one who holds this particular stance is particularly concerned with the merits of democracy. Call me on it, if I'm wrong, scarejunba.

<comment><USER27> The topic is city level democracy vs. county or state level democracy.

A lot of housing and transportation problems are caused by the regulation being too local.

<comment><USER25> a lot are caused by things like messed up state level property taxes.

California's housing problems are multiple levels of poor regulation.

</comment></comment></comment></comment></comment><comment><USER37> After reading the article (including the letter which was reproduced within), I feel an equally fair title could be:

"Mayor and Commissioner of Transportation lobby for the right to enforce their own rules, not just state laws, on Lyft"

<comment><USER38> How so? It seems like the mayor is reacting to lobbying by Lyft.

<comment><USER37> The state is considering a piece of legislation. The mayor:

\- wrote a letter and released it for publication by the press

\- gave interviews or quotations to journalists for publication

Both of these seek to influence state legislators, and the evidence is right there in the article.

Where is the evidence of Lyft's lobbying?

And does 'who started it' matter? (I mean, if X did the first lobbying act, does that automatically make them the party in the wrong?)

<comment><USER9> _Both of these seek to influence state legislators, and the evidence is right there in the article.

Where is the evidence of Lyft's lobbying?_

I'd like to counter your question with a question: why shouldn't a mayor be speaking up to influence state legislators if they believe legislative issues could have an impact on their city? This is literally one of the primary duties of being an elected leader at the city level.

<comment><USER27> > why shouldn't a mayor be

...but nobody said they shouldn't.

<comment><USER9> I'm sorry, taking into context the comment I quoted from the chain it resides in, from the way the person I'm responding to initially reacted to this post, it looked otherwise at a glance.</comment></comment></comment></comment></comment></comment>


Internet Freedom Wanes as Governments Target Messaging, Social Apps - happy-go-lucky http://www.npr.org/sections/alltechconsidered/2016/11/14/500214959/internet-freedom-wanes-as-governments-target-messaging-social-apps <comment><AUTHOR> How did the Snowden Disclosures get completely dismissed by this report? US intelligence has been backdooring social and messaging apps for mass surveillance and propaganda (e.g. Zunzuneo) for decades.

Internet freedom was only a short, small blip of possibility. It died decades ago when control was consolidated into regulated corporations, its companies were infiltrated by intelligence personnel, and when modern communications became a specific military target (with UK and US leading the charge).

This story doesn't offer solutions (I get that it's not trying to). Rather, it repudiates specific countries for specific decisions while giving others a free pass for their own unsavory behavior.

It's cute that their map shows the former Soviet Union as "not free" and the former American Cold War strategic assets as "free" \- but this cute glib approach to assessment is backed by a severe lack of security analysis and a severe lack of reasonable acknowledgement of basic facts.

Here's an approach: encourage technology whose transparency and control is centered in individuals & cede top-down influence over the networks of those individuals and their technology as much as is technically possible.

Don't like that solution? Well, you're in for a ride called "waning internet freedom". Color the map however you want. But appropriating the free software movement into some military geopolitical nonsense loses you credibility.

<comment><USER2> > It's cute that their map shows the former Soviet Union as "not free" and the > former American Cold War strategic assets as "free"

Very good point. I think anyone interested in how "Free" press is used and how un-free it usually is, should read Manufacturing Consent by Edward Herman and Noam Chomsky. Hate them or love them, they provide a very good examples that are documented of "free" media bias.

My favorite example is CNN recently. I think they at some point dropped the pretense and sunk to levels lower than what Fox has been considered. My favorite recent example is of course Chris Cuomo from CNN who said "...it is illegal to possess these stolen documents. It is different from the media. So everything you learn about this, you are learning from us." That is such a brilliant example of what is happening.

The only question there to ask is why be so blatant and desperate about censorship. And I think the answer is because they got desperate. They realized they lost control.

As you say, and Snowden showed US govt has been using Tweeter and other such thing to control and conduct various operations. I am guessing the Arab Spring is a good recent example.

<comment><USER3> That would be this CNN clip:

[https://www.youtube.com/watch?v=_X16_KzX1vE](https://www.youtube.com/watch?v=_X16_KzX1vE)

And this is the best explanation for why he was wrong:

[https://popehat.com/2016/10/17/no-it-is-not-illegal-to- read-...](https://popehat.com/2016/10/17/no-it-is-not-illegal-to-read- wikileaks/)

As for why they would do that, well, they leaked the debate questions to Donna Brazille. And then she lied about it, saying they were modified. Anyone on here can go check the DKIM headers, they're both valid and they cover the body of the message providing cryptographic non-repudiation.

<comment><USER2> Yes! that's the one. For some reason I just really remembered it and in my mind it summarizes what "media" has become.

It has always been this way, but I guess it has recently hit new lows.

</comment></comment></comment></comment><comment><USER4> Brazilian politicians are currently suggesting to create a new federal agency to regulate mobile apps because they "are unfair competition" to the services provided by the government-enforced oligopoly of four mobile carriers that basically share the market equally ([http://img.estadao.com.br/link/files/2012/01/operadoras- tele...](http://img.estadao.com.br/link/files/2012/01/operadoras-telefonia- jan12.jpg)), and because Whatsapp doesn't (can't) hand out encrypted conversation histories to the police ([http://adrenaline.uol.com.br/2016/11/09/46694/mp-defende- cri...](http://adrenaline.uol.com.br/2016/11/09/46694/mp-defende-criacao-de- agencia-para-regular-whatsapp-e-aumentar-o-controle-sobre-app/)).

<comment><USER5> Brazilians being Brazilians it is quite likely that this will create an incentive for people to start using illegal apps.

E.g.: in Brazil abortion is illegal but quite common, tax evasion is illegal but quite common, smuggling from Paraguay is illegal but quite common, gambling is illegal but quite common, ...

<comment><USER6> It's very hard to make those applications actually illegal (the Congress literally does not have the power for that).

More likely, the government will regulate any company distributing them out of existence, while foreign companies and software-only protocols will get the entire market.

</comment></comment></comment><comment><USER7> Network engineer here: the best crypto in the world won't save you when the government sends men with guns to your offices to tell you to null route certain IP blocks (google IPs, YouTube, Turkey) or forces all ASNs in the country to single home themselves to the government run ASN (DCI, Iran).

There are a lot of bottlenecks at layers 1-3 that autocratic regimes can use to mess with the internet long before layers 4-7 become important.

<comment><USER8> >>Network engineer here: the best crypto in the world won't save you when the government sends men with guns to your offices to tell you to null route certain IP blocks

Yep. This is _exactly_ why crypto is not the solution to government oppression. The only thing crypto does is make the government's snooping more difficult, which can definitely piss them off and/or flag your activities as suspicious. And that is generally NOT what you want when facing a government actor.

Look, I'm going to say something that's going to be very unpopular here since this forum is full of techies. Here it is: you can't solve social problems using technology, because at the end of the day it's humans who are the weakest link in any equation. Keeping your communications encrypted isn't very meaningful when the government can just torture whatever it needs out of you and your loved ones. Sure, that's illegal in much of the West today, but that is now. The future holds no such guarantees. In fact, I'd posit that the USA at least is just one major terrorist attack away from full-on tyranny. Another September 11 equivalent and we're all fucked, crypto or no crypto.

</comment></comment><comment><USER9> This is what we get for designing systems with a low number (typically one) privileged centralized controlling body.

The government gets to roll up and says "I'll have some of what they're having."

I'm not saying that there aren't advantages to centralized architectures, just that this is one of the inseparable tradeoffs that comes with those decisions.

<comment><USER10> I will admit I maybe missing the point of your comment. Are you referring to the infiltration of large telecommunications and social media providers? If you are referring to the underlying protocols themselves then it doesn't make much sense as packet based protocols were initially funded and built by the US Department of Defense.

<comment><USER11> He is referring to technologies like Facebook which are controlled 100% by 1 person. Verses technologies like email which are not fully controllable by a single entity.

<comment><USER12> How is Facebook a technology? It's a database-backed website, complete with PHP and MySQL. What innovation is intrinsic to anything about Facebook?

<comment><USER13> Wait a sec - you're getting caught up in the minutae. OP said

> This is what we get for designing _systems_ with a low number (typically > one) privileged centralized controlling body.

The successive replies morphed the word into _protocol_ and then _technology_ , and here we are arguing how Facebook is in any way innovative in order to qualify as a _technology_ \- an argument totally disconnected from the one upthread.

</comment></comment></comment></comment></comment><comment><USER14> ...Well, just stick to the web and the more underground sections of the internet, and avoid big silos. Don't log into facebook. Don't log into google. Hell, don't even use google, if DDG works for you now.

Overall internet freedom isn't waning as much as you think. Step outside the silos, and look at the net, not just your corner.

<comment><USER15> Sure. Same old story though, "the silos" are where "the masses" are. If you're doing Just Underground Thangs in "the more underground sections", "TPTB" will happily leave you alone because you're fringe (no leverage, no voice) and you're not engaging "the masses". If you aimed to, you'd have to play in the silos, by "silo rules". ;)

Back when we had the communist bloc or before the fascist axis, the above model seemed much more potently free-est-of-all because "autocrats would target and shut down underground channels, not here though"..

</comment></comment><comment> rm_-rf_slash Although perhaps politically impossible, I maintain that the only check against corruption and misuse of mass data collection is to make it freely available to the public.

Mass surveillance is not going away. If anything, it will accelerate. The only way to keep the powerful from misusing it is to put everybody on the same level playing field.

The alternative is to glue our crossed fingers together and hope that nobody will abuse a technology that can bring so much good to do many people.

<comment><USER16> You might be interested in this: [http://www.theatlantic.com/politics/archive/2014/08/this- man...](http://www.theatlantic.com/politics/archive/2014/08/this-man-has- nothing-to-hide/379041/)

> The only way to keep the powerful from misusing it is to put everybody on > the same level playing field.

I'm inclined to agree with you, but I have a few issues:

1) Nobody will ever be on the same playing field. There will always be someone who needs special closed-door meetings because "state-secrets" or "to catch the bad guys" or whatever. I think it is just too easy to abuse by those in power for them to let it slip by.

2) We'd need to stop treating criminals or outsiders as "bad" people first. Example: We need to treat violent offenders as people who don't fit in well with our non-violent society, rather than horrible people who need locked away and punished. We'd have to start recognizing that people who don't fit in well are often products of our culture, and we need to do more to support them.

3) I think the social changes would be _drastic_ , for good and bad. Example: We'd start to realize how, statistically, everyone watches porn from time to time, and what types they watch. There's way too much social stigma out there right now for me to think that would end well.

<comment><USER17> for a follow up to 3) I recommend investigating South Park's "TrollTrace" episodes where a town riots due to browsing/troll history lookup power given to the citizens.

</comment></comment></comment><comment><USER18> So Freedom wanes because governments are doing what internet monopolies(facebook and google) have been doing for years?

<comment><USER19> So far Google hasn't prosecuted me for spreading atheism.

<comment><USER17> "First they came for the neo-liberal Trump supporters, and I didn't speak up."

<comment><USER13> When did Google do that? I guess it's more romantic than "First they came for the link-spammers, and I didn't speak up."

</comment></comment></comment></comment><comment><USER20> We will witness the day when everyone is forced to have a unique internet ID and your full name and address are revealed when you visit a website. It will have a vast chilling effect on free speech. Everyone who uses non-backdoored encryption will be a prosecuted criminal. Uncontrolled free speech only harms government and prevents it from growing.

<comment><USER21> I hate to be the sheeple-ception guy, but :

> We will witness the day when everyone is forced to have a unique internet ID

FB and google can already fuly trace most people's web journeys

> your full name and address are revealed when you visit a website.

They also have your physical data.

> It will have a vast chilling effect on free speech.

Facebook and Youtube's comfort bubbles of information already regulate your ability to reach people, and filter your information sources.

> Everyone who uses non-backdoored encryption will be a prosecuted criminal.

Meanwhile, Whatsapp, the standard bearer of encryption, leaks your data to the parent company, for advertising purpose.

> Uncontrolled free speech only harms government and prevents it from growing.

You're already owned by people in power. Breaking free already entails becoming an outcast in your society. And maybe, just maybe, if you fear the government to take control, allowing such power to concentrate in a couple corporation is not a good idea, and you should drop your dichotomy between private and public entities.

<comment><USER22> The irony that most people agree about "around-the-corner" dystopian futures but when you provide fact that we are already living in one you start seeing "conspiracy nut/paranoid/shadow-people" replies.

Many don't step out of mainstream lifestyles and so they don't see the rigid boundaries. Think Allegory of the Cave.

<comment><USER23> Those who do not move do not notice their chains.

</comment></comment></comment></comment><comment><USER24> Better link (prefer original sources): [https://freedomhouse.org/report/freedom-net/freedom- net-2016](https://freedomhouse.org/report/freedom-net/freedom-net-2016)

The "what about Snowden's revelations" argument is partially missing the point. People in the 'green' countries don't experience network-wide blocks, or loosely-targeted, blanket arrests for merely participating in platforms, even in places where other chilling-effect factors exist, like in the US [1], and Hungary [2] (both of them conductors of mass surveillance [3][4]), which are documented in detail in the long-form reports. This lack of active, direct governmental harassment of ordinary citizens is a fairly observable difference in outcomes from those places where this occurs.

But in any case, their reports are more valuable than their map, which distills many disparate, sometimes orthogonal factors into one of four discrete colors. In my opinion, despite Freedom House's good content in their textual reports, the Reporters Without Borders 'World Press Freedom Index' [5] provides a ranking that more accurately represents chilling effects that are not due to direct governmental coercion.

[1] [https://freedomhouse.org/report/freedom-net/2016/united- stat...](https://freedomhouse.org/report/freedom-net/2016/united-states) [2] [https://freedomhouse.org/report/freedom- net/2016/hungary](https://freedomhouse.org/report/freedom-net/2016/hungary) [3] [http://arstechnica.co.uk/tech-policy/2016/01/top-european- co...](http://arstechnica.co.uk/tech-policy/2016/01/top-european-court-to- snooping-governments-mass-surveillance-needs-judicial-oversight/) [4] [http://fra.europa.eu/sites/default/files/fra_uploads/hungary...](http://fra.europa.eu/sites/default/files/fra_uploads/hungary- study-data-surveillance-hu.pdf) [5] [https://rsf.org/en/ranking](https://rsf.org/en/ranking)

</comment><comment><USER25> Considering the biased source, it'd be nice to hear first hand experience from HNers.

Let me start.

India:

Generally free. Sometimes random people are arrested because they happened to curse a politician, and some moron complained to the Police. It's more often comical, in contrast to say cases like Snowden/Assange, The IT dept. (like much else) are rather incompetent, and have at various points blocked Github and Vimeo in their puritanical zeal.

</comment><comment><USER26> How could germany be so free?

[https://en.wikipedia.org/wiki/Blocking_of_YouTube_videos_in_...](https://en.wikipedia.org/wiki/Blocking_of_YouTube_videos_in_Germany)

<comment><USER27> GEMA is not the German government as far as I can see...

</comment></comment><comment><USER28> Germany free?

Especially to those ones who criticize Merkel's immigration policy...

This report is a joke.

<comment><USER27> German police here, downvoting this comment. /s

Just stop. There are limits on free speech in Germany, but it's mostly for denying the Holocaust and yelling "sieg heil" in the street etc. I assume you're not referring to that?

<comment><USER29> Or satirizing Erdogan:

[https://boingboing.net/2016/04/23/german-political-leader- ar...](https://boingboing.net/2016/04/23/german-political-leader-arrest.html)

Or "hate speech", which will certainly have a chilling effect on the legitimate discussion of immigration policy:

[https://www.washingtonpost.com/world/europe/germany- springs-...](https://www.washingtonpost.com/world/europe/germany-springs-to- action-over-hate-speech-against- migrants/2016/01/06/6031218e-b315-11e5-8abc-d09392edc612_story.html)

[https://www.theguardian.com/world/2016/apr/19/head-of- german...](https://www.theguardian.com/world/2016/apr/19/head-of-german-anti- islam-group-pegida-trial-hate-lutz-bachmann)

<comment><USER30> While we are on the subject the UK has a law that states : "No extracts from parliamentary proceedings may be used in comedy shows or other light entertainment such as political satire"

So political satire shows like Jon Stewart and the Late show? Can't happen in UK. Guess thats why John Oliver, an englishman, is doing his show in the US.

[https://www.theguardian.com/commentisfree/2011/jul/31/jon- st...](https://www.theguardian.com/commentisfree/2011/jul/31/jon-stewart- parliament-broadcast-satire)</comment></comment></comment></comment>


Winklevii say they own one percent of all Bitcoins - <AUTHOR> http://arstechnica.com/tech-policy/2013/04/winklevii-say-they-own-1-percent-of-all-bitcoins

<comment><USER2> This was already submitted in some form in the form of a Verge article here: <https://news.ycombinator.com/item?id=5535664>

<comment><USER3> Yup, but it's better now because just a few articles before are submissions about bitcoin tanking and mtgox stepping away or having troubles or whatever.

</comment></comment><comment><USER4> ""We have elected to put our money and faith in a mathematical framework that is free of politics and human error," Tyler Winklevoss said."

He sounds like quite the expert on the matter.

<comment><USER5> "We are all, by any practical definition of the words, foolproof and incapable of error."</comment></comment>


Show HN: Red Hat/CentOS chroot installer - <AUTHOR> https://github.com/dozzie/yumbootstrap

<comment><USER2> I was seriously involved only in debian packaging, so could someone tell me - how did RH do consistent package building without this tool? I constantly see people making silly mistakes when they package without pbuilder.

<comment><USER3> A bit old but basically still valid for the most part: [http://opensource.com/life/11/7/free-sake-story- koji](http://opensource.com/life/11/7/free-sake-story-koji)

</comment></comment><comment><USER4> yum itself can already install to chroots, so a tool like this shouldn't be necessary on yum-based distributions.

[https://plus.google.com/+LennartPoetteringTheOneAndOnly/post...](https://plus.google.com/+LennartPoetteringTheOneAndOnly/posts/2HJAeRgtFBw)

[http://rwmj.wordpress.com/2009/03/05/fedora-equivalent-of- de...](http://rwmj.wordpress.com/2009/03/05/fedora-equivalent-of-debootstrap/)

<comment><USER5> Yup, this tool is completely unnecessary and overengineered. With yum it's a single command to install in a chroot (yum --installroot ...).

</comment></comment><comment><USER6> FYI: [https://github.com/libguestfs/febootstrap](https://github.com/libguestfs/febootstrap)

<comment><AUTHOR> Yes, I've seen it. In old version (2.x) it could only install Fedora, in never version (3+, called _supermin_ ) it doesn't install chroot environments.

<comment><USER5> Try supermin 5, which has chroot support. How to use it is documented on this page (search for "chroot"). supermin 5 is widely available in Linux distros.

[http://rwmj.wordpress.com/2014/03/08/supermin- version-5/#con...](http://rwmj.wordpress.com/2014/03/08/supermin- version-5/#content)

</comment></comment></comment><comment><USER7> Does this utility require you to actually install the base system (with yum and all) to the target, or can you install only the requested packages with their dependencies? This is fairly important distinction when making minimal containers.

<comment><AUTHOR> No, you don't need to install Yum, it's just defined in default suites. You'll also need to disable fix_rpmdb.py postinstall script, which is necessary to make Yum runnable from inside chroot.

On the other hand, almost anything you would want to install will pull glibc, which is big package. But I suppose you could prepare trimmed down alternative and put it in additional repository. Seems doable.

</comment></comment><comment><USER8> FWIW Rinse is still maintained, under new owners.

I stopped maintaining it myself, along with xen-tools, a couple of years ago, but both projects have new owners and are active.

<comment><AUTHOR> Thank you for comment. I need to update README to reflect reality.

</comment></comment><comment><USER9> There used to be an rpmbootstrap-like tool for using on Xen RPM-based guests, though it was never as reliable as debootstrap in my experience.

Nicely done, I'll have to try it.

<comment><USER8> I suspect you're talking about rinse, which I wrote alongside xen-tools.

It is still alive and well, under new maintainers:

[http://collab-maint.alioth.debian.org/rinse/](http://collab- maint.alioth.debian.org/rinse/)

</comment></comment><comment><USER10> how does this compare to 'rinse'?

<comment><AUTHOR> * Easier to add packages to installation list (no need to track dependencies manually).

* Allows multiple Yum repositories to be specified and used during bootstrapping.

* RPM signatures checking.

* Doesn't depend on repository mirror to list directory contents, so it makes less work with the mirror setup.

* RPM spec already included, so yumbootstrap installs under Red Hat/CentOS.</comment></comment>


A Couple of Meta-Interpreters in Prolog - <AUTHOR> https://www.metalevel.at/acomip/ <comment><USER2> Thank you very much for the publicity, I greatly appreciate it!

Prolog is rather unique in that it admits a meta-interpreter in roughly 3 lines of code. Contrast this with other languages, where writing an evaluator typically takes much more code, even for quite high-level languages.

This brevity is possible mainly because Prolog - like Lisp and assembly language - is a _homoiconic_ language, and in addition to that, Prolog has powerful built-in mechanisms that can be used in interpreters, and in addition to _that_ , Prolog variables on the object-level (the program to be interpreted) are also variables on the meta-level (the interpreter). As a consequence, Prolog's implicit mechanisms can be _absorbed_ in interpreters: They need not be encoded explicitly.

Enjoy!

<comment><USER3> Can you explain to me what you use Prolog for and why you chose it over something more popular? What are the pros/cons in your mind?

Everytime I get started, I eventually stop when I realize I'm not an alien named Spock :). In all seriousness, it is very challenging to me, so kudos to you. My bucket list has Forth, APL, Lisp, Smalltalk, and Prolog on it.

<comment><USER2> Learning Prolog was very challenging for me too! I was extremely lucky though in that I had one of the world's greatest Prolog experts as instructor, using the world's most sophisticated Prolog teaching environment:

[https://www.complang.tuwien.ac.at/ulrich/gupu/](https://www.complang.tuwien.ac.at/ulrich/gupu/)

You can take a short pictorial tour of GUPU:

[https://www.complang.tuwien.ac.at/ulrich/gupu/d-2-europastad...](https://www.complang.tuwien.ac.at/ulrich/gupu/d-2-europastadt- dax)

However, these pictures can at best give a small glimpse of what GUPU actually is, so I also recommend a longer paper:

[https://www.complang.tuwien.ac.at/ulrich/papers/PDF/gupu- wlp...](https://www.complang.tuwien.ac.at/ulrich/papers/PDF/gupu-wlpe2002.pdf)

For me, a major attraction of Prolog is the _balance_ it strikes between readability, versatility and convenience. I know languages that sometimes admit shorter programs, but they then are - at least in my experience - not as readable as a Prolog version, or not as versatile.

I am using Prolog for many different tasks, such as hosting web pages, prototyping showcases, and solving combinatorial optimization problems.

<comment><USER3> I have to make extensive use of Linear Programming & Mixed-Integer Linear Programming in my day job. This all runs on CPLEX. It would be really cool to do that sort of thing in Prolog, but I doubt it could handle massive models. Anyway you could explain what combinatorial optimization is for and how it differs from the things commonly seen in operations research?

<comment><USER2> For solving linear programs and mixed-integer linear programs with Prolog, I recommend the CLP(Q) and CLP(R) libraries of SICStus Prolog. See for example:

[https://sicstus.sics.se/sicstus/docs/3.7.1/html/sicstus_32.h...](https://sicstus.sics.se/sicstus/docs/3.7.1/html/sicstus_32.html)

For discrete optimization tasks, also check out the integer constraint solver that ships with SICStus Prolog. See especially the combinatorial constraints:

[https://sicstus.sics.se/sicstus/docs/4.1.0/html/sicstus/Comb...](https://sicstus.sics.se/sicstus/docs/4.1.0/html/sicstus/Combinatorial- Constraints.html#Combinatorial-Constraints)

As to the relation between Prolog and operations research: Prolog systems _internally_ use methods from operations research to efficiently solve optimization tasks; in addition to that, you can of course also implement every OR algorithm in Prolog.

For many commercial users of SICStus Prolog, the efficiency of its constraint solvers are an important reason for buying a licence.

</comment></comment></comment></comment></comment><comment><USER4> I know this is not the done thing, but a meta-interpreter is the best, easiest, simplest way I've found to explain resolution (for maximum impact, you can trace a program through the meta-interpeter so the other person gets to see what's going on).

And if I can be allowed a shamless plug of my research team's work, it's also possible to turn a meta-interpreter to an inductive learning procedure, so that you can generate a new program from examples of its inputs and outputs, even as you prove it. It's called Meta-Interpetive Learning:

[https://github.com/metagol/metagol](https://github.com/metagol/metagol)

<comment><USER5> Sorry to be rude, but could you ask/beg Prof Muggleton to write a book on ILP and/or meta-interpretive learning? Something like an expanded version of his outline webpage ([https://www.doc.ic.ac.uk/~shm/ilp_theory.html](https://www.doc.ic.ac.uk/~shm/ilp_theory.html)).

My go-to for trying to understand ILP theory is Nienhuys-Cheng and de Wolf, _Foundations of Inductive Logic Programming_ and De Raedt's _Logical and Relational Learning_ is a more up-to-date overview, but I feel like there's room for a more modern textbook. This new MIL stuff seems to be be an important unifying idea that also connects back to abductive logic programming, if I understand correctly.

Just a request; no offence intended!

<comment><USER4> Not rude at all! There are precious few textbooks on ILP, it's mostly a bunch of scattered papers published in various journals and conferences. Nienhuys- Cheng and de Wolf are an excellent first point of call. You can also try the following books:

Logical and Relational Learning - Luc de Raedt [[https://www.amazon.com/Logical-Relational-Learning- Cognitive...](https://www.amazon.com/Logical-Relational-Learning-Cognitive- Technologies/dp/3642057489)]

Probabilistic Inductive Logic Programming, Theory and applications - Luc de Raedt, Paolo Frasconi, Kristian Kersting, Stephen Muggleton [[https://www.amazon.com/Probabilistic-Inductive- Programming-L...](https://www.amazon.com/Probabilistic-Inductive-Programming- Lecture-Computer/dp/3540786511)]

And this book chapter (although it's probably nothing new compared to Foundations of ILP):

Inductive Logic Programming: Theory and Methods - Stephen Muggleton and Luc de Raedt [https://www.sciencedirect.com/science/article/pii/0743106694...](https://www.sciencedirect.com/science/article/pii/0743106694900353)

Unfortunately, there are, as of yet, no textbooks on Meta-Interpretive Learning and I don't expect there to be one for a few years still. MIL is a very new area of research. The first papers were published only in 2015 and we are basically still working on it furiously. It will take a while before there is enough material for a textbook. All the same, I am planning to do a few internet postings regarding MIL, at some point in the near future.

Please feel free to contact me via my profile email, if you would like some pointers to MIL and more general ILP resources other than the ones discussed above.

<comment><USER5> Thanks for the pointers! I look forward to your postings.</comment></comment></comment></comment>


Java Is TIOBE's Programming Language of 2015 - thomas-b http://www.tiobe.com/index.php/content/paperinfo/tpci/index.html?languageof2015=java <comment><AUTHOR> Yeah, right. And Groovy's risen from #82 to #17 in 12 months. Just how serious can you treat this stuff?</comment>


Ask HN: Startup shutting down; how should investors be treated? - <AUTHOR> A startup I advise is going to shut down soon. Their first investor, a friend of mine, is asking me a very good question. Call him Mr.X.
Mr.X was the first investor, and his convertible note is due in a couple of months. The startup raised about 1M in a first seed (of which he was first investor), and another 1M in another seed, at a higher valuation. The startup has approx. 0.5M left.
How should the startup treat him?
1) They should give each investor approx. 1/4 of the money they invested (2M invested, 0.5M left = 1/4).
2) They should consider the different valuations of the two seeds, and therefore give the investors in the first seed more than what they give to investors in the second seed.
3) They should consider how old the convertibles are, and do a weighted average.
4) None of the above: they should instead...
Any help (from past experiences, or just opinion), is much appreciated. I don't want to reveal what my inclination is to avoid adding bias to your comments.
I think this is a very interesting discussion that is not often covered on HN, and therefore useful even besides the specific advice for these guys. <comment><USER2> I am not a lawyer and I am not an accountant. But really the answer is more difficult than a multiple choice question. The real answer comes down to the terms of each investment and how that specific investment is laid out. It all comes down to how liquidation is spelled out in the terms of each specific investment and the investments as a cumulative.

<comment><AUTHOR> Besides the strictly legal aspect, what do you feel would be fair?

</comment></comment><comment><USER2> I can't answer that. There are too many variables involved and like I said it is not as simple as a multiple choice question. You have to consider the percentage of the company they own for their investment. If Mr. X owns 5% and Mr. Y owns 25% well Mr. Y is entitled to more money. However, if Mr. X has a liquidation preference in his investment he may end up getting more than Mr. Y.

The question has way too many variables and even more unknowns to give a simple answer to. It is strictly a legal question that should be handled between attorneys, investors, and the company.

</comment><comment><USER3> I don't think they would be any more happy getting back any less of what they invested. The average (good) investor cares about getting his money back or more. Anything else is a sub-optimal result. $500k is plenty of money to give a core team 1 year of runway to pivot and find something else interesting enough to purse (or to get at least to revenue and profitability). My $.2

<comment><AUTHOR> True, but in this specific case the CEO has decided it is not worth it.

</comment></comment><comment><USER4> With nontrivial amounts invested and remaining, this seems like a good time to consult an experienced lawyer, rather than asking some dudes on the internet.

</comment><comment><USER5> I would use a fully diluted approach giving back the $ each one had "as converted" with conversion price being the avg of the caps.</comment>


How Uber, AirBnB, and the Sharing Economy Avoid Sharing the Wealth - <AUTHOR> http://www.bloomberg.com/news/articles/2016-04-06/the-sharing-economy-doesn-t-share-the-wealth <comment><USER2> Honest question: If I create a website that someone uses to to facilitate commerce in Australia, why is it obvious that I should pay Australian tax? I'm not using the resources of the government and their government services did not facilitate the creation of my website.

Shouldn't taxes be at least marginally linked to services rendered by the government? If my business delivers products and I use public roads, I think its reasonable to contribute to that. Or if I consume a product that has been deemed safe by the regulatory body of that government, that seems reasonable to tax as well. But facilitating commerce through websites seems less obvious.

<comment><USER3> Mental exercise: Would any Uber or AirBnB transactions occur if Australia we currently as portrayed in the Mad Max movies? Why not?

<comment><USER2> I'm not sure that governments really have the best track record on securing human rights. But yes, peacefully mutually beneficial voluntary exchange of goods and services can exist without a coercive force.

</comment></comment></comment><comment><USER4> The Treasury Secretary, Jack Lew, just issued laws related to "inversion" where American firms buy out foreign and transfer their headquarters to the foreign firm to avoid taxes. Pfizer was about to execute such an inversion until the new laws came out.

I hope that Treasury similarly will issue laws that prevents services such as Airbnb and Uber from escaping taxes.

<comment><USER5> Don't just hope. Contact your representatives! Airbnb and Uber move offshore? Call Visa and Mastercard.

</comment></comment><comment><USER6> 'Gig/sharing jobs' are a way to circumvent the economic inefficiencies of minimum wages and regulation. If these gig jobs are so awful, workers can always look elsewhere, although good luck: on a 2011 national hiring day, McDonald's got 1 million applicants for only 50,000 job openings.

Some gig workers make a lot of money - more than they would with a regular job. The competitive and meritocratic nature of gig jobs reward efficiency and productivity, and this benefits customers and the economy.

Uber, Air BNB, Task Rabbit allow people to earn money when they may not have otherwise been able to .</comment>


Coverity Scan Update - <AUTHOR> https://community.synopsys.com/s/article/Coverity-Scan-Update <comment><USER7> Coverity Scan regularly goes down for hours or days.

In February of 2018 it was down for over a month with no word or ETA on when it would be fixed. I hadn't thought about it since then (we discontinued use), but researching it now they released a statement saying that it was hacked. There was not a single status update during the outage. [https://www.theregister.co.uk/2018/03/19/coverity_scan_crypt...](https://www.theregister.co.uk/2018/03/19/coverity_scan_cryptomining/)

</comment><comment><USER8> I wonder who the hosting provider was. I'm not seeing much in the news about one that "unexpectedly ceased operations", just the expected background news of scattered outages.

<comment><USER9> Based on DNS history for the domain it looks like it was [https://twitter.com/nephoscale](https://twitter.com/nephoscale) | [http://nephoscale.com/](http://nephoscale.com/)

<comment><USER8> Wild! I wonder why they picked a host that I'd literally never heard of before this moment? Not that I claim encyclopedic knowledge of virtual hosting providers, but still.

<comment><USER10> Coverity was an acquisition. The hosting company was probably ran by a friend of the founders (both seem to be based in the bay area).

</comment></comment></comment></comment><comment><USER11> Coverity is really good. It is a pity some of its advances, effective in practice but not really "publishable", will forever remain as proprietary secret.

Source: I worked on static code analysis product and we extensively black-box tested Coverity.

<comment><USER12> What kind of advances are you thinking of?

As best I can tell, most of the warnings are either things that can be figured out for a single translation unit and (some) compilers will eventually incorporate as warnings, or things that can only be figured out by analyzing / linking across many translation units - which a compiler can't do, but the actual "advance" is simple enough if you have all the function definitions to hand.

<comment><USER11> Most advances are about filtering false positives. If you do "simple" interprocedural analysis and dump the result you will find lots of bugs together with lots of false positives and you can't sell that.

In other words, all the advances are in warnings you don't see. Yes, all Coverity warnings you see, are simple. I agree.

Quoting from [https://cacm.acm.org/magazines/2010/2/69354-a-few-billion- li...](https://cacm.acm.org/magazines/2010/2/69354-a-few-billion-lines-of- code-later/fulltext)

> Since the analysis that suppresses false positives is invisible (it removes > error messages rather than generates them) its sophistication has scaled far > beyond what our research system did. On the other hand, the commercial > Coverity product, despite its improvements, lags behind the research system > in some ways because it had to drop checkers or techniques that demand too > much sophistication on the part of the user.

<comment><USER13> :) Cool that you recognize that.

This is correct. Coverity does a bunch of specific analyses designed to eliminate False positives. This includes analysis to determine which data states are not possible for a given code path, and doesn't report those specific issues. This also works using data across function calls.

For C/C++/C#, Coverity has by far the lowest false positive rates, which make it probably the best in class for those languages.

Disclosure: I used to work at Coverity.

<comment><USER11> Fascinating! The specific example you mentioned sounds publishable, any idea? I mean, I am just curious, I no longer work on this.

I now have quite different perspective wrt false positives; that false positive rate is not important. It's all about perspectives. Name the tool bug search engine instead of bug finding tool. You rarely look beyond the first page of search engine result. Develop a ranking algorithm such that all alarms in the first page is relevant. You can use any probabilistic voodoo to rank. Etc. I don't know whether this can work. But I think it's worth a try.

<comment><USER12> I think the takeaway here is that Coverity have just made a (clever) business decision to eliminate false positives, so that (nearly) 100% of their defects are "correct". It's quite possible that there are real defects that they _don 't_ show because their confidence is less than 100%.

<comment><USER11> No, not really. "false positives are the enemy" (or at least, in my alternative model, relevancy) becomes _glaringly obvious_ for anyone who tried this at scale. The question is how to reduce false positives (or improve relevancy). The part that "real defects not shown" exist is called unsoundness and pretty much everybody now agrees you should be unsound. (Or being sound is a different market.)

Of course, this is not obvious to people who haven't tried, so it is reported over and over and over. The most recently, from Google. Lessons from Building Static Analysis Tools at Google (2018). [https://cacm.acm.org/magazines/2018/4/226371-lessons-from- bu...](https://cacm.acm.org/magazines/2018/4/226371-lessons-from-building- static-analysis-tools-at-google/fulltext) I mean, I could have told them.

Select quotes:

> Unlike compile-time checks, analysis results shown during code review are > allowed to include up to 10% effective false positives.

IMPORTANT NOTE: 10% effective false positives means much less than 10% false positives! In above quote, Google defines true bugs marked as not-a-bug by a developer as effectively false positives. If what you say is true, but users misunderstand, it doesn't count.

</comment></comment></comment></comment></comment></comment></comment><comment><USER14> Has anyone tried LGTM / Semmle QL for automated code review? They claim 100K OSS projects are using the service. It's a bit hard to find technical information on the product, but they have found CVEs in mainstream products, including iOS.

[https://lgtm.com](https://lgtm.com) & [https://semmle.com/ql](https://semmle.com/ql)

<comment><USER15> I work on C/C++ analysis at Semmle, and am happy to answer any questions you might have. (We also support C#, Java, JavaScript, Python... and Cobol!)

We have a few high-profile projects using our automated code review (marketing people tell me I'm not allowed to call it 'PR integration' any more). One example is on the AMP Project, where we caught a regex injection vulnerability in a PR before a human looked at it: [https://github.com/ampproject/amphtml/pull/13060](https://github.com/ampproject/amphtml/pull/13060)

Our default analysis has found a few other vulnerabilities (remote buffer overflows due to misuse of snprintf in rsyslog and Icecast spring to mind) but, honestly, I think our strength lies in the fact that you can write custom queries that find bugs specific to a single codebase's foibles.

For example, my first ever CVE was for a vulnerability in ChakraCore. Google Project Zero found the original bug - type confusion caused by failure to check a flag indicating that the last element of a list should be cast to a different type - but we wrote a query to verify that code accessing that particular list always checked the flag. So when some new code got introduced with the same bug, we noticed as soon as we re-ran the query on the new commit.

<comment><USER14> _> We also support C#, Java, JavaScript, Python... and Cobol!)_

Where do these rank in chances of future support?

      - <USER2>
      - <USER3>
      - <USER4>
      - <USER5>
      - <USER6>

<comment><USER16> Go support is currently in development, so very likely :)

As for the other languages there, there are no plans currently on the roadmap for 2019 to add any of them. However if this is something that particularly interests you, we'd encourage you to apply for a job and note that you'd like to add support for a particular language :)

</comment></comment></comment></comment><comment><USER17> I honestly thought it is gone!

All links are dead, and synopsis.com's big Corp style website isn't helping one bit.

</comment><comment><USER18> > Coverity Scan is a free static code analysis tool for Java, C, C++, C# and > JavaScript. It analyzes every line of code and potential execution path and > produces a list of potential code defects.

There we go, I had no clue what this even was. Do a lot of people here use it?

<comment><USER19> Coverity have one of the best static analyzers for C++ and CSharp. Not a surprise considering they have had* ex-Microsoft compiler engineers such as Eric Lippert working for them.

I understand from speaking to C++ engineers who have extensive experience in embedded / industrial applications that Coverity is used extensively there.

Personally I've never seen the need to apply it to CSharp projects because the language is naturally safer than C++ and you get a lot of "bang for the buck" by using the tools built into Visual Studio and from JetBrains.

* He works at Facebook now :facepalm:

</comment></comment><comment><USER20> Wouldn't it be great if professional websites will someday get to the level of non-professional websites? E.g. by giving this announcement page a proper title: "Coverity Scan Outage".

Update is a change, this is an outage.</comment>


The Next Ten Billion Years (2013) - <AUTHOR> https://www.resilience.org/stories/2013-09-05/the-next-ten-billion-years/ <comment><USER2> Didn't need the existencial crisis but thanks for sharing.

Worth a read, even if I'm left feeling hopelessly insignificant and helplessly doomed, any disagreement with the author's vision notwithstanding.</comment>


London's Crossrail Is a $21B Test of Virtual Modeling - <AUTHOR> http://spectrum.ieee.org/transportation/mass-transit/londons-crossrail-is-a-21-billion-test-of-virtual-modeling <comment><USER2> I've been hearing more and more about BIM (building information modeling) recently. Seems like that their total commitment to BIM was a key component of this massive project. [https://en.wikipedia.org/wiki/Building_information_modeling](https://en.wikipedia.org/wiki/Building_information_modeling)

I'm wondering what might happen if the wealth of structured information within some of these mega-projects finds its way onto the internet. I recognise that a lot of the construction data must be proprietary but what if were possible to open up some of this construction data? Perhaps this is an area the Open knowledge Foundation (or someone like them) should be tracking, assuming they are not already. [https://okfn.org/](https://okfn.org/)

ps: Superb in-depth article. I love me some mega-project info, don't know why!

<comment><USER3> Given the current security climate I would be amazed if anyone succeeds in opening datasets like this for the public. Given that with full access to structural data anyone can find the best ways to do all sorts of things. I'm not saying that someone would use it for planning demolitions, virtually train for troop operations or to figure out the best way to flood the system with gas, but because the use cases are so obvious...

</comment></comment><comment><USER4> The numbers behind this project are quite amazing: [http://www.crossrail.co.uk/news/crossrail-in- numbers](http://www.crossrail.co.uk/news/crossrail-in-numbers)

</comment><comment><USER3> Does anyone have detailed information on the technology stack? What software are they using for the large scale modeling and model management? Is the AR solution referred to in the article custom? Whose bluetooth beacons are they using for indoor positioning?

</comment><comment><USER5> Literally in awe of the engineering it takes to build something like this, let alone metres beneath one of the world's largest cities

</comment><comment><USER6> Good example of doing something well, that probably shouldn't have been done at all. This will make London a better city to live in, causing even more people to move there. This will make it even bigger than it already is. This will make it an even more attractive target for terrorism. This will cause the UK to enact even more police state like laws on surveillance etc.

Why on earth don't they spend that money building a subway in some other UK city instead?

<comment><USER7> Making London (or any city) better to live in is a good idea if it's affordable, as is attracting more people to places that have a relative advantage in attracting investment and creating jobs. The terrorist argument doesn't make much sense - London must already be pretty high up on the list of "attractive" terrorist targets based on all kinds of factors and I can't see how a million or two more (or fewer) people is going to make much difference.

On the other hand, there's an excellent argument for creating infrastructure outside London, it would be great to see a much stronger second city (or metropolitan region) - this would be attractive to some businesses that may be put off the capital by cost, relieve pressure on London, and be great for people for a multitude of reasons.

Given how cheaply governments can borrow money right now, I don't understand why they're not doing both, or why developed countries in general currently spend so little on infrastructure.

<comment><USER8> It's not like the UK government isn't trying. The whole "Northern Powerhouse" and such.

The basic problem is that people, by and large, want to live and work in London rather than Manchester (which is I think the only credible competitor to London for mega-city status right now).

Building Crossrail isn't something where you can just sort of pick and choose where to drop it. London transport is horribly overcrowded already. If it doesn't keep up with demand then it's not like everyone will just say, oh well, we'll all just move en-masse to a different city. If that were going to happen it'd have happened already. Instead they'll just keep packing in like sardines and feel miserable.

The UK already borrows huge sums of money. It's only cheap because so many countries have been or are printing money to fund public spending, which means it's not really anywhere near as cheap as it looks.

<comment><USER7> I agree with all of the above but would love to see the "Northern Powerhouse" receive tens of billions (like London) rather than the tens of millions it seems [1] to be getting so far.

[1] [http://www.theguardian.com/uk-news/2016/mar/16/osborne- budge...](http://www.theguardian.com/uk-news/2016/mar/16/osborne-budget- chancellor-northern-powerhouse-manchester)</comment></comment></comment></comment>


Show HN: Escape the Brexit, find a place to move to now that UK left the EU - <AUTHOR> https://escapethebrexit.com <comment><USER2> This site is kinda silly because of the #brexit, but I like the city specific approach and think it would be fun for people to have debates about the "ratings" in a positive way. For example, Chattanooga, TN, USA is listed as 'red' for fun and I think it's great fun (I used to live near there, not so close these days). I like smallish cities with lots of walking, and good local food, beer, walking trails, rivers, mountains, music, and attractions. Anyways... for all the Brits looking for a break from #brexit come to the US and have some fun and stay if you'd like (and if we'll let you, that's a different topic unfortunately) or realize you like home and enjoy that too. Happy travels!

</comment><comment><USER3> How funny. If #frexit doesn't occur within one year, I'm considering seriously moving to UK (or Russia).

</comment><comment><USER4> Nice idea, but my city ranks in the mid-500's. Couldn't disagree more about its metrics.

</comment><comment><USER5> How does San Diego have poorer air quality than LA???

<comment><USER6> How come Paris has a "green" air quality at all!

</comment></comment><comment><USER7> Hey, why isn't my city listed there?

<comment><USER7> [https://en.wikipedia.org/wiki/Lagoa_Santa,_Minas_Gerais](https://en.wikipedia.org/wiki/Lagoa_Santa,_Minas_Gerais)</comment></comment>


How companies became addicted to debt - <AUTHOR> https://www.ft.com/content/c732fded-5252-4333-a3f8-80b767508bbc <comment><USER2> _> …has drawn attention to the relentless build-up in corporate debt in the US, where companies now owe a record $10tn — equivalent to 49 per cent of economic output. When other forms of business debt are added in, including to partnerships and small businesses, that already extraordinary figure increases to $17tn [83% of GDP, the highest ever].

> Even before the pandemic, the level of corporate leverage was beginning to > cause alarm. At the end of last year, the IMF issued a striking warning: as > much as $19tn of business debt in eight countries led by the US — or 40 per > cent of the total — could be vulnerable if there were a "material slowdown" > in the economy, a scenario that, if anything, now seems tame._

I like to think of it this way:

At present, a business that is barely-investment-grade (say, BBB-/Baa3) can borrow for a decade at just over 3%/year. A risky business that is rated as junk (i.e., below BBB-/Baa3) can borrow for a decade for as little as 6% to 7%/year. The interest payments are tax deductible, so the effective annual cost to borrow is around 2.5% for barely-investment-grade and around 5% for junk, give or take. As long as the executives think they can earn more than 2.5% to 5% per year on any money they borrow, why not borrow it? And if they can justify using borrowed money to buy back shares, keeping their stock options in-the-money, why not do it?

Many US companies in mature industries (think energy, hospitality, travel, transportation, etc.) have been doing exactly that, to the point that corporate debt is now the highest ever in relation to US GDP. And it has worked _beautifully_... that is, until a global pandemic suddenly cut their revenues by 10% to 20% or even more, instantly flipping those expected earnings into losses. People are no longer traveling as much, or going to restaurants as much, or going to the office as much, etc.

All of a sudden, all those businesses are losing money on all that borrowed money -- they are losing so much, in fact, that many have had to borrow _even more_ during the pandemic to be able to continue paying interest on prior borrowing and avoid going into bankruptcy.

<comment><USER3> Don't you think that companies are just reacting to the fed/bank of england etc keeping rates at 300 year lows?

[https://www.bankofengland.co.uk/-/media/boe/files/monetary-p...](https://www.bankofengland.co.uk/-/media/boe/files/monetary- policy/baserate.xls?la=en&hash=EEB8729ABFFF4B947B85C328340AE5155A99AD0F)

<comment><USER4> If central bank rates were too low, we would see inflation, but we don't. Rates are so low because savers want to save more than borrowers want to borrow. Corporations are just taking advantage of the large pool of savers that's already out there.

<comment><USER5> Rising asset prices don't count as inflation to you?

<comment><USER6> Not OP, but I don't see any data suggesting that assets are inflating. For real estate, inflation adjusted price per square foot hasn't changed for most of the US [0] (west coast admittedly has ballooned but that's because their cities are built in valleys with a fixed amount of land and restrictive zoning causing a fixed amount of housing and thus bidding up home prices; not a problem for most of the country though). As for equities, Annualized S&P 500 Return (Dividends Reinvested) from 2005-2020 are 6.738% [1] versus 7.690% for 1990-2005 [1].

Or are you talking about another asset?

[0]: [https://www.supermoney.com/inflation-adjusted-home- prices/](https://www.supermoney.com/inflation-adjusted-home-prices/)

[1]: [https://dqydj.com/sp-500-return- calculator/](https://dqydj.com/sp-500-return-calculator/)

</comment></comment></comment></comment></comment><comment><USER7> Something I have never seen a good answer to or explanation of: what is an "appropriate" debt or leverage ratio for a healthy company?

Obviously, a private company with hundreds of millions in stable recurring revenue shouldn't operate debt-free -- debt can be a useful tool, even if only as a rainy-day tool for situations such as the recent pandemic.

In other words, corporate debt -- and especially low-interest and covenant- free debt that is secured using recurring revenue -- seems like a capital allocation (corporate finance) tool with a set of trade-offs relative to cash and venture investment. But, how much debt is "too much"? I feel like those of us who work in software can sometimes forget that for most industries, venture capital isn't even an option, which means debt can be one of your only growth financing sources of capital -- and even for those in software, some companies are not venture-fundable but might still be debt-fundable.

It's clear that the PE firms that load up billion dollar companies with billions in debt are just playing a speculative finance and asset strip-mining game. But, it would be a shame if we invested all of this time, money, and regulation into a robust "financial capital banking sector", and we can't even rely on it for capital that businesses can use to create jobs, service customers, and smooth the rough patches in the economy.

<comment><USER8> > Obviously, a private company with hundreds of millions in stable recurring > revenue shouldn't operate debt-free -- debt can be a useful tool, even if > only as a rainy-day tool for situations such as the recent pandemic.

Why obviously? Seems to me when a crisis hits the last thing you want to have is debt you need to pay back. For example, should Apple, with their huge mountain of cash, have debt? Do they need debt?

I guess one can also ask the same about countries. Do they really have to maintain some level of debt in order to have a healthy economy? Why not just have a big bunch of cash put aside for a rainy day? How is this "obvious"?

<comment><USER7> Also, re: your question about Apple:

> For example, should Apple, with their huge mountain of cash, have debt? Do > they need debt?

Obviously not. Debt is for companies that have already utilized most of their cash, right? Or have future cash flows that they want to access now before the cash actually materializes. Apple, by contrast, should probably become an investor or lender, since it doesn't know what else to do with its excess cash. It certainly serves no purpose being hoarded on their balance sheet.

<comment><USER9> You can create debt in jurisdiction A collateralised with assets (even cash!) in jurisdiction B... potentially without any tax implications. I expect Apple can borrow money basically for free, so there's probably a bunch of financial- engineering type reasons that debt would be useful to them.

</comment></comment></comment></comment><comment> daniel-s That period in the 70s also corresponds with the moment that US dollars lost any ties to gold.

There is a natural rate of interest in an economy. When the central bank artificially lowers interest rates you get malinvestments. This is only possible with fiat currencies because you can't print gold.

None of this would be possible if interest rates were at (say) 5% which is about the historic average, or at early 90s (double digit) levels.

This ends dramatically. I'm guessing with a less dramatic version of Zimbabwe or the Weimar republic.

<comment><USER10> "There is a natural rate of interest in an economy."

Yes, and the base rate is zero. Since reserves are costless to produce and banks can't get rid of them in aggregate the base rate should always be zero.

It is rates above zero that are unnatural since by definition they are a market intervention that reduces the price of all other assets and drives up yields artificially.

The state shouldn't be paying a Basic Income to banks in the form of interest on reserves. Banks should earn their crust by lending productively.

Beyond that the rate of interest is the one estimated by the lender to be sufficient to cover the risk of discounting your collateral into the state's liquidity.

Banks are really just pawnbrokers with shinier suits and better PR.

<comment><USER11> The base rate is non-zero because capital has non-zero cost. Interest is just the limit of the cost of capital. If you don't have a fed, or if the fed does nothing then interest rates will converge on their own to a positive value.

<comment><USER10> Banks have a capital cost. The central bank does not. I was talking about base rates. Banks mark up on base rate to cover the risk to their capital

</comment></comment></comment></comment><comment><USER12> This is a very informative article, but it has one major deficiency.

I have a general rule that when we are looking at something going bad in our country, one of the things to do is look at how the issue is handled in other countries, like are they doing it better or worse, and what can we learn from that that might help us decide what to do here.

With that in mind, the article should have covered how this whole corporate debt issue is handled in other countries. Are they doing better or worse? Perhaps someone who has some knowledge here could make a comment.

<comment><USER13> Well, Japanese companies used to have a lot of debt in the 80s and when the crash came, a lot of them got hurt. Now, they're mortally afraid of debt and cant for the life of them ever expand their revenue. Japan is a cautionary tale of what happens when people save too much money, are too risk-adverse, and are unwilling to borrow.

The BOJ has been trying to get inflation up for decades with some of the lowest rates around and it hasn't worked. The country has been in a recession for a good 30 years and no amount of monetary policy manages to make things any better.

Debt is a really powerful force, both positive and negative. I think for some businesses, like real estate, it makes sense to have a lot of debt, and others, like brick and mortar retailers, where debt can very easily destroy your entire business.

<comment><USER12> Thank you, that's a very interesting comment.

</comment></comment></comment><comment><USER14> Perhaps an unorthodox way of looking at things, but it's very intersting take a step back to consider what 0 to low interest rates might accomplish for society:

\- Low interest rates mean it makes no sense to simply keep cash, it's better to invest in _something_ productive. For companies that's new projects/ideas which create jobs, for individuals that might be spending on goods to stimulate the economy or buying a house.

\- High interest rates are a considered a way to reduce "risky" investments. But in reality, interest is rent seeking on capital which benefits (1) lenders/banks (2) capital holders. Cheap capital enables more projects with positive ROI (above cost of capital) to be persued. And this is good for society as it drives innovation and allocates capital to innovators instead of locking it under stagnant rent seeking. Lest you worry, this doesn't hurt capital holders, as they can instead proactively invest in companies and make the same or larger returns, but now capital is allocated by merit of the project being invested in instead of by simply who can afford it because it meets some threshold. This unlocks the "long tail" of innovation. This is what is referenced in the article: 1970s Hertz took a risky bet using debt which paid off to record profits.

\- Higher interest really means higher long run inflation. If you can just let money sit in a bank, doing nothing directly productive for society, and there is suddenly more of it, prices will adjust accordingly. With low interest rates, money supply will adjust with GDP growth from innovation and prices might even be reduced by higher competition and discovery of efficiencies. As long as innovation (enabled by access to capital) stays on pace with money supply, inflation stays low.

This is of course a very optimistic way of looking at things which doesn't consider the effect of things like wage growth which has all but stopped. One could argue in a non-inflationary environment that might be ok, but this is a larger topic having to do with social mobility goals rather than just the economics.

<comment><USER15> > Higher interest really means higher long run inflation.

In orthodox macro, higher interest rates -> reduced investment -> reduced demand -> reduced inflation. This is pretty much empirically proven by how central banks have been able to control inflation in the West.

The way I see it is the "search for safety", especially where negative interest rates are concerned. There are two huge concentrations of safety- seeking money in the modern economy: pension funds and oligarchs. The pension funds more or less have to buy government bonds in a certain ratio, regardless of the price. Whereas the oligarchs have hundreds of billions they need to keep anonymously in a stable economy - ie dollars, pounds, and euros.

Things like the Apple "cash" pile of $245bn represent a lot of floating wealth too.

Ultimately, if we don't get real wealth taxes, interest rates will be forced negative simply by the market and the huge volume of safety-seeking money.

<comment><USER14> It's always strange to see the "orthodox" macro realtionship take precedent over emperical results (see article and figure 1 scatter plot: [https://www.stlouisfed.org/publications/regional- economist/j...](https://www.stlouisfed.org/publications/regional- economist/july-2016/neo-fisherism-a-radical-idea-or-the-most-obvious-solution- to-the-low-inflation-problem)). In the short term, the orthodox thinking might be correct and an effective lever for the economy, but long term, it's clear that high interest leads to higher inflation AND less innovation which are bad outcomes IMHO.

I agree with your observation for the demand to keep money "safe". We should define what that means. Historically, if you choose to keep wealth in a stable cash with real interest rate (nominal interest rate minus inflation rate) that is positive or zero, it's safe as it retains or grows its buying power. The "or zero" part is important as it allows for a zero interest environment if that also means low inflation.

Some may even argue that a reasonable negative interest rate is "safe" and it's just like a "wealth tax" which is the cost of service for keeping large sums of money at the bank. Shouid safety be free (no negative rates)? I would say maybe yes, but safety shouldn't also reward you... and positive interest rates do exactly that.

</comment></comment></comment><comment><USER16> The 'Elephant in the Room' here is the chart they did not show, and it's interest rates, which have been steadily declining. You can't fight the impetus for the system to want to give you free money because in the race to equilibrium, your competitor will do it, which leaves you with little choice.

Imagine that some industries are 'thin margin' and naturally going to be competitive, and a little prone to failing if there is a hiccup.

What 'low interest rates' do is exacerbate that quite a lot - so that only a little hiccup is needed to blow you up.

There is a really, really interesting national parallel between the fall of Spain in the 2008 crisis and this story. The 'accepted narrative' is that when the Euro came along, Spain acted 'irresponsibly' and borrowed too much. But a more careful analysis (from an FT interview no less!) showed that they actually acted rationally given the very cheap money flowing in from 'Rich Europe' at the time.

So the overarching issue is real: there's a lot of corporate debt. But it's a financing instrument like any other, it might actually make sense for companies to be leveraged to some extent. Credit runs the economy, this is a form of credit.

I think a much bigger 'meta' look at this from the FT Economists would be warranted - instead of looking at this as more of a 'corporate activity' kind of thing, look at it from an economic equilibrium perspective in terms of defining 'how much debt' is actually good, or bad, and why.

</comment><comment><USER12> From what I understand, the basic problem is this. The way things are supposed to work is corporations take their profits and divide them up in two ways. Part goes to paying the owners, like dividends to stockholders. Part goes in investing in the future, like research and building factories.

The problem is that for a long time a large proportion of companies have been paying out an increasing portion of their profits to pay off massive and ever increasing debts. They still keep paying profits to the owners, and so they have ever less left for investing in improving the company. That in turn means poor growth and being less competitive in world markets.

And even worse when the economy goes through a bad period, many thousands of companies can no longer pay their huge debts and go bankrupt, with great damage to the economy.

</comment><comment><USER17> Instead of free market finding the proper risk-adjusted yield for a bond, we are swinging between over-regulated squeeze (shut down non-blue chips companies from access to capital) and free-for-all central bank buying bonanza (carpet-buying of corp bonds). It is either very hard for business to get access to capital, or CB makes it excessively easy.

Somehow FT makes is look like it is some "financial engineering" fault that companies are "addicted to debt". How about letting willing debt buyers get into transaction with willing debt sellers? That simple.

</comment><comment><USER18> "Pension funds and insurance companies bought the debt in bulk"

Is it fair to say that pension funds are largely to blame for this? Corporations can't acquire debt if nobody offers them money. Insurance companies too, of course, but pension funds in particular are at least theoretically supposed to be protecting the workers. Hard to see how debt- funded corporations (I'll mention Uber as an egregious example) are in alignment with the interest of the workers.

<comment><USER19> > Is it fair to say that pension funds are largely to blame for this? > Corporations can't acquire debt if nobody offers them money.

About as fair as it is to say that people who wish to receive some income after retirement are to "blame" for this. Nobody can save without some other party (households, companies or the state) acquiring debt.

<comment><USER18> Junk bonds are hardly the only form of investment, and certainly not the safest, if your goal is to ensure someone's retirement. Moreover, corporate debt is at high risk of mass default in a market downturn such as the current one.

<comment><USER19> Any large pension fund has a large portfolio of bonds of all grades and yields. Most will still have the bulk allocated to investment grade government and corporate bonds. But the yields on safe investments have been so low for so long that they all see themselves forced to choose between riskier investments (leading to cheaper and cheaper debt as per article) or telling their participants that they need to save way more for their retirements.

<comment><USER18> That is true. But I'd say it's better for the funds to be honest with the participants than to try to pretend everything is fine and paper over lower returns with higher risk, because ultimately it won't be fine. Over-leveraging is a strategy that can bring short term results but is destined to fail in the long term — catastrophically.

<comment><USER19> Good luck telling your state workers that they all need to take a pay cut (which is what lower pension returns really are) and/or your local citizens that they'll face a tax hike (if you don't want the state workers to take the hit), because you read in the FT that "companies are addicted to debt", and that we have this hunch that all this debt will collapse at some unknown time in the future.

<comment><USER18> "because you read in the FT" is a not a fair response. The linked article is not breaking news, it's an analysis of a well known phenomenon.

With great power comes great responsibility. If someone can't be honest, they have no place managing other people's money.

</comment></comment></comment></comment></comment></comment></comment><comment><USER20> The economy has been based on credit for a loooong time. I learned about how it works from Ray Dalio's excellent video on how the economic machine works [https://m.youtube.com/watch?v=PHe0bXAIuk0](https://m.youtube.com/watch?v=PHe0bXAIuk0)

</comment><comment><USER21> No, not companies. Investors who rather get dividends or share buybacks than having the company pay down debt

</comment><comment><USER22> [https://archive.is/r1js6](https://archive.is/r1js6)

</comment><comment><USER23> Just print the money

</comment><comment><USER24> is it different from governments or individuals?

<comment><USER10> Depends which sort of government: sovereign or otherwise (US state, Scotland, Eurozone member). Sovereign government don't really have debt in the sense you would recognise as debt.

<comment><USER13> Government debt denominated in foreign currency looks pretty much identical to corporate or individual debt.

<comment><USER10> Indeed. That's part of the "otherwise" \- the reason why a Eurozone country struggles. They denominate in a currency issued by a foreign entity they don't control.</comment></comment></comment></comment>