Piketty's inherited-wealth dystopia: private capital millionaires multiply


Thomas Piketty's much-discussed economics bestseller Capital in the Twenty First Century prophesies a future where inherited wealth dominates the world, because the rate of return on capital outstrips the rate of growth in the economy, meaning the money your ancestors earned will always outstrip what you could earn. A new Boston Consulting Group report confirms Piketty's hypothesis, concluding that the share of wealth due to capital increased by 14% last year

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London property bubble entombs a thousand digger-machines


London's property bubble has got people energetically expanding their property, digging out sub-basements -- and the insane bubblenomics of London housebuilding are such that it's cheaper to just bury the digger and abandon it than to retrieve it. London's accumulating a substrate of entombed earthmoving machinery.

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Turn on your data for one minute, AT&T sticks you with a $750 international roaming charge


Jeff writes, "I learned this week that it's possible to run up a $750 international data roaming bill in one minute on AT&T. I managed to convince AT&T to forgive the charges after two days and 40 minutes of phone calls but the best guess at how this happened is kind of alarming. It seems that AT&T's billing system sometimes bundles US traffic with international traffic." Jeff was driving in the Pacific northwest, near the Canadian border.

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Kickstarting a Skull-a-Day book

Noah Scalin writes "At long last I'm finally publishing all 365 of my original Skull-A-Day creations in a single book! I've partnered with Chop Suey Books, an amazing local independent bookseller here in Richmond, Virginia to finally create the ultimate volume of my yearlong skull art making project. The store is even launching a new imprint, Chop Suey Books Books, just to make and distribute this beautiful hardcover volume (if I do say so myself, since I'm the one that designed it!). I'm most excited about sharing a new model for artists and local businesses to work together to create something outside of the old systems, that can benefit us both, as well as our community. To kick things off we've decided to pre-sell the book on Kickstarter with some unique thank you gifts, including some of the actual original pieces of the project! I hope you'll check it out."

$24 gets you an early-bird book. Noah is a guy who ships what he starts, too.

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Picketty vs politics: where does the rate of profit come from?


Suresh Naidu analyzes Thomas Piketty's groundbreaking economics book Capital in the 21st Century (previously), disagreeing with one of Piketty's core assumptions: that the rate of profit is a given, not the product of things like trade union law, global treaties, and other political decisions. This is wonkier than last night's post about Piketty, but a lot more interesting, in my view.

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Matt Taibbi's The Divide: incandescent indictment of the American justice-gap

Matt Taibbi’s
The Divide: American Injustice in the Age of the Wealth Gap
is a scorching, brilliant, incandescent indictment of the widening gap in how American justice treats the rich and the poor. Taibbi’s spectacular financial reporting for Rolling Stone set him out as the best running commentator on the financial crisis and its crimes, and The Divide — beautifully illustrated by Molly Crabapple — shows that at full length, he’s even better. Cory Doctorow reviews The Divide.

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What's the story with the Makerbot patent?

The 3D printing world is all a-seethe with the story that Makerbot supposedly filed a patent on a design from its Thingiverse community. As Cory Doctorow discovered, the reality is a little more complicated: if Makerbot has committed a sin, it is not the sin of which it stands accused.

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Sexagintuple Vanilla Bean Mocha Frappuccino: a $55 Starbucks drink


The Sexagintuple Vanilla Bean Mocha Frappuccino now holds the record for most expensive on-menu Starbucks beverage, coming in at a whopping $54; the 128 oz drink had 55 shots of espresso, with an estimated caffeine dose of 4.5g. Its owner, Andrew Chifari, spent about five days consuming it. He ordered it as his free bonus drink on the Starbucks loyalty card scheme, which gets him one free drink for every 12 (my own joke about this, worn as thin as onion-paper, goes like this: every tenth drink, I ask the folks at Giddy Up to give me "one of everything in a bucket with a piece of banana bread stuck in the top"). Andrew set out to break previous most-expensive-Starbucks-beverage record by enlisting the assistance of the baristas, as he explained to Consumerist:

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Tor founder Tom Doherty on publishing without DRM


Two years ago, Tor Books, the largest sf publisher in the world (and publisher of my own books) went DRM-free; yesterday, Tor's founder and publisher Tom Doherty took to the stage to explain why he dropped DRM from his books. Doherty spent some time talking about the business outcomes of life without DRM (in short, there's no new piracy of Tor books as a result of publishing without it), but really focused his talk on the community of readers and writers, and their conversation, and the role Tor plays there. Doherty's philosophy is that books get sold by being part of a wider context in readers' lives -- being something they talk and think about and share, and that DRM just gets in the way of that.

Meanwhile, Hachette -- publishing's most ardent DRM advocate -- and Amazon continue to duke it out in a ghastly and abusive public spat in which Amazon is attempting to extort deeper discounts from Hachette by de-listing, delaying and obfuscating its titles. If Hachette books were DRM free, the company could announce an "Amazon-refugee discount" of 10% of all its ebook titles at Google Play, Ibooks, and Barnes and Noble, and offer a tool to convert your Kindle library to work on one of those other players. But because Hachette allowed -- insisted! -- that Amazon put its own DRM on Hachette books, the only company that can authorize converting Amazon Kindle titles to work with other readers is Amazon.

Good luck with that.

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Privacy vs network effects


Respected cryptographer and security researcher Ross Anderson has a fascinating new paper, Privacy versus government surveillance: where network effects meet public choice [PDF], which explores the "privacy economics" of mass surveillance, pointing out the largely overlooked impact of "network effects" on the reality of who spies, who is spied upon, and under what circumstances.

My first big point is that all the three factors which lead to monopoly – network effects, low marginal costs and technical lock-in – are present and growing in the national-intelligence nexus itself. The Snowden papers show that neutrals like Sweden and India are heavily involved in information sharing with the NSA, even though they have tried for years to pretend otherwise. A non-aligned country such as India used to be happy to buy warplanes from Russia; nowadays it still does, but it shares intelligence with the NSA rather then the FSB. If you have a choice of joining a big spy network like America's or a small one like Russia's then it's like choosing whether to write software for the PC or the Mac back in the 1990s. It may be partly an ideological choice, but the economics can often be stronger than the ideology.

Second, modern warfare, like the software industry, has seen the bulk of its costs turn from variable costs into fixed costs. In medieval times, warfare was almost entirely a matter of manpower, and society was organised appropriately; as well as rent or produce, tenants owed their feudal lord forty days’ service in peacetime, and sixty days during a war. Barons held their land from the king in return for an oath of fealty, and a duty to provide a certain size of force on demand; priests and scholars paid a tax in lieu of service, so that a mercenary could be hired in their place. But advancing technology brought steady industrialisation. When the UK and the USA attacked Germany in 1944, we did not send millions of men to Europe, as in the first world war, but a combat force of a couple of hundred thousand troops – though with thousands of tanks and backed by larger numbers of men in support roles in tens of thousands of aircraft and ships. Nowadays the transition from labour to capital has gone still further: to kill a foreign leader, we could get a drone fire a missile that costs $30,000. But that's backed by colossal investment – the firms whose data are tapped by PRISM have a combined market capitalisation of over $1 trillion.

Third is the technical lock-in, which operates at a number of levels. First, there are lock-in effects in the underlying industries, where (for example) Cisco dominates the router market: those countries that have tried to build US-free information infrastructures (China) or even just government information infrastructures (Russia, Germany) find it’s expensive. China went to the trouble of sponsoring an indigenous vendor, Huawei, but it’s unclear how much separation that buys them because of the common code shared by router vendors: a vulnerability discovered in one firm’s products may affect another. Thus the UK government lets BT buy Huawei routers for all but its network’s most sensitive parts (the backbone and the lawful-intercept functions). Second, technical lock-in affects the equipment used by the intelligence agencies themselves, and is in fact promoted by the agencies via ETSI standards for functions such as lawful intercept.

Just as these three factors led to the IBM network dominating the mainframe age, the Intel/Microsoft network dominating the PC age, and Facebook dominating the social networking scene, so they push strongly towards global surveillance becoming a single connected ecosystem.

Privacy versus government surveillance: where network effects meet public choice (via Schneier)

(Image: Friendwheel, Steve Jurvetson, CC-BY)

The Internet With a Human Face: Maciej Cegłowski on the things we need to fix


Maciej Cegłowski's latest talk, The Internet With A Human Face, is a perfect companion to both his Our Comrade the Electron and Peter Watts's Scorched Earth Society: A Suicide Bomber's Guide to Online Privacy: a narrative that explains how the Internet of liberation became the Internet of inhuman and total surveillance. Increasingly, I'm heartened by the people who understand that the right debate to have is "How do we make the Internet a better place for human habitation?" and not "Is the Internet good or bad for us?" I'm also heartened to see the growth of the view that aggregated personal data is a kind of immortal toxic waste and that the best way to prevent spills is to not collect it in the first place.

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Feminism and tech: an overdue and welcome manifesto


Alan writes, "A group of nine women involved in the tech industry have posted a manifesto listing some of the awful sexist things that have happened in tech during the past few months. The women frame this as a simple statement: 'we really just want to work on what we love.' But the reality of the industry and the societies in which we do our tech work make this far from simple."

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Brandalists replace 365 outdoor ads in 10 UK cities with hand-printed works of art

Last week, in a coordinated attack by guerrilla artists across the UK, 365 outdoor ads were replaced by hand-printed works of art. It was a project of Brandalism, and they hit 10 cities, using hi-viz vests and steely nerves as camouflage while they did their work.

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Steve Wozniak explains Net Neutrality to the FCC

Steve Wozniak, the co-founder of Apple, has published an open letter to the FCC in support of Net Neutrality; Woz explains his view of traditional American fairness and the role of good government, and decries regulatory capture, and warns the FCC that it will lose its "white hat" if it helps corporate America break the Internet.

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A tough second in the markets


A whack of (presumed) fat-fingered orders caused a massive, one-second drop in stock-trading yesterday; the trades fell through the cracks in the anti-flash-crash stuff that's supposed to keep the high-frequency traders from destroying the planet.

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