Wednesday, October 22, 2008

Personal Note and Update

October 22, 2008, 7:25 a.m.

Personal Note and Update

For the past couple weeks, in addition to my regular teaching at the University of Iowa College of Law, I've been involved with preparation for and presentation at the "Carterfone and Open Access in the Digital Era" conference put on by the High Technology Law Institute of the Santa Clara University School of Law in California.

It's amazing how well the world was able to keep on turning without my daily blog entries during that time. Also rewarding is the extent to which the 500-plus entries in this blog have apparently now become a reference source for users with or without daily additions; the daily hits remained pretty solid.

And at least some progress can be reported with regard to a number of the issues we track that is at least consistent with this blog's recommendations.

Here, then, are mostly mini-entry updates about a range of subjects: Global economic collapse; Afghanistan/Pakistan; Bars, Booze and Binge Drinking; Corporate Welfare; Sexual Assaults; Carterfone; and the Dysfunctional Airline Industry.

Global economic collapse. Since first making the suggestions that the first Paulson plan (approved by Congress) was flawed, and that the taxpayers should be getting an equity interest for their money (following the Swedish example from 1992), both the U.S. and Brits have moved in that direction. Similarly, more attention has been given to helping mortgage-struggling homeowners rather than just greedy bankers, holding down the personal compensation paid to the CEOs of bailed banks, the need to get a jobs program ready to roll out (which could do double duty in the repair and building of the long-ignored infrastructure featured on PBS last evening), the need for more prosecutions of those responsible for our current plight, some long term fixes, and an awareness that we're heading into an unprecedented and unknowable global recession/depression involving far more than the financial sector.

No; I suffer no illusion that any of these movements have been affected in the slightest by anything I wrote. But it is always reassuring to see one's early instincts and writings sort of confirmed by subsequent events, or the comments of those who really do know what they're talking about.

Afghanistan/Pakistan. Similarly, the evidence continues to mount, as I have earlier written, that there is no "military solution" to the problems we confront in Afghanistan/Pakistan (or Iraq for that matter). Indeed, the presence of our troops is in many ways counter productive -- angering local civilians, turning off both "hearts and minds," destroying rather than building a sustainable local economy, and contributing to the recruitment of terrorists. Most recently, yesterday, over the protests of the Kabul government, our continued bombing resulted in the killing of nine more Afghans -- this time soldiers fighting alongside Americans. Meanwhile, our relations with Pakistan, and our military activities there, have contributed to the disintegration of Pakistan's government and economy -- to the point that Pakistan (a nation with nuclear weapons) is probably now, potentially, the single most dangerous country in the world so far as America's national security is concerned. Not because it's leadership is "anti-American," but because it is a country where joblessness and chaos means starvation, and eventually uncontrollable revolution.

Bars, Booze and Binge Drinking. The City Council is taking another look at the social and economic costs of alcohol abuse that its policies, and those of the University, have permitted to increase over the years. It remains to be seen how effective any ultimate proposals may be -- the Council refuses to even consider a proposal that those who cannot legally buy alcohol should be required to leave the bars at 10 p.m. (erroneously called "21-only") -- but I'd rather the Council at least be addressing the problems than continue the "see-no-evil-hear-no-evil" approach.

Corporate Welfare. Surprise, surprise, the Sheraton has just been given -- for free, so far as I can gather from the papers -- a 13-foot swath of formerly public street and land. This was described as a "license." That sounds an awful lot like Senator Ted Stevens' effort to draw a distinction between a "loan" and a "gift" of property (e.g., a $2500 chair, a generator) he received, and didn't report on the ethics forms. Iowa City's taxpayers, who once owned Dubuque Street, had retained a 25-foot swath of it under the Sheraton for a public walkway. The City Council has just told the hotel it can capture 13 feet of it to expand its lobby. And while I'm on this subject, what's the deal about turning over public sidewalks to restaurants to expand their seating capacity? Do they pay to use that public property, or is that more of the Council's generosity with our land?

Sexual Assaults. The Regents and their universities are moving ahead with the effort to come up with new organizational arrangements and procedures for handling sexual assaults. It remains to be seen what they'll come up with -- beyond the Stolar Report recommendations. One of the toughest issues involves respect for the alleged victim's wishes. If she ends up deciding not to file a complaint with the police the university (especially if athletes are involved as alleged perpetrators) is open to speculation that it played a role in encouraging her to do so. If they don't report it on their own they can be charged with a "cover up." If they do report it on their own they can be charged with interfering with the alleged victim's rights of privacy.

Carterfone. As an FCC commissioner, most of the some 400 opinions I personally wrote were dissents or concurrences, explaining why I thought some or all of what my fellow commissioners were doing was wrong. One of the most significant opinions I wrote, however, was a unanimous opinion for the majority -- much more far reaching in its effect than anyone could have known at the time, myself included. Sufficiently so that a conference was held at Santa Clara University last Friday to celebrate its 40th birthday. Sometime early next year there will be a book-length collection of the papers presented, so I can't summarize all of the issues here in a blog paragraph -- even those addressed in my own keynote address.

It was decided at a time when AT&T had as close to a complete monopoly as any company in America. It both manufactured and owned all the telephone handsets, the cable, the switching stations, the long distance lines -- all of it. And it had an FCC tariff to insure it stayed that way. Nothing could be attached to the telephone network that was not AT&T's -- up to and including even a plastic cover on a telephone book, also called a "foreign attachment."

Tom Carter, a Texas cattle rancher, wanted to be able to take and place phone calls while out riding fences. He invented a device that enabled him to do it. The Carterphone could receive radio communication from his transceiver, hold a telephone handset, and switch back and forth as the parties spoke.

AT&T fought it as a violation of its tariff. The FCC, through the opinion I wrote, found the tariff illegal. It took another 10 years to implement the decision (with "Part 68" regulations), but ultimately Americans could buy telephones in drug stores, and almost unnoticed began using "modems" resembling Tom Carter's device, with "acoustic cups" for a telephone handset, to connect their early desktop computers to what became "the Internet."

Among the issues we confront today, some 40 years later, are whether the principles (or even precedent) of the Carterfone decision are relevant to resolving some of the bottlenecks and impediments the major cell phone carriers are imposing on their customers, and the suppliers of new devices (that sometimes take the form of computer "software" rather than "hardware"), in an age when cell phone ("wireless") carriers are rapidly becoming the primary on ramps to the Internet.

You'll have to wait for the book (or movie) to get the whole story, but that will give you some idea of what I've been up to while away from the blog.

Dysfunctional airline industry. Meanwhile, getting to California and back was just a further reminder of how dysfunctional our airline industry has become. This is not a new observation for me, nor I suspect for you. So much so that when Mary and I were going to Denver last August we opted for the train.

What a treat! We actually had a roomette, but I'm not sure I'd bother next time. The coach seats on a train are better than the first class seats on a plane. They go back further, and with foot rests make sleeping possible. They and tray tables don't have to be "put in their full upright position" every time you enter a station. Large picture windows in every car -- not to mention the lovely "observation cars" -- let you see (rather than merely imagine) what the countryside looks like. You can walk around whenever you please (the full length of the train if you wish), rather than be buckled in. Get food whenever you want at reasonable prices. Read, write on your laptop, make cell phone calls, nap.

Airline travel never was a big thrill for me, but I never experienced any fear of flying, and found it generally pleasant enough during the latter half of the Twentieth Century. Going to Japan with some regularity, it was often possible to find six empty seats where you could stretch out. On domestic flights there were enough flight attendants on board to bring you food and drink and be otherwise pleasant and attentive without being stressed. The seats, and space between rows, were wider and more comfortable -- with often an empty seat beside you where you could spread out papers and such. My memory is the seats went back further, too. Flights were usually on time; baggage usually came through safely. There were few delays for last minute "maintenance" or otherwise cancelled flights. There was little concern about hijacking or terrorists. A flight was a time to relax, away from phones and other interruptions. On the rare occasions when a canceled flight required an overnight stay, the airlines would pay for your hotel and meals until you could leave the next day.

There was a time when I represented American Airlines as a lawyer. And I later became almost a United Airlines groupie -- buying a lifetime Red Carpet Club membership (during a very narrow window of time when it was an incredible bargain -- never then imagining that my own lifetime might end up lasting longer than that of United), carrying a United Visa card, piling up my Mileage Plus miles, and usually travelling often enough to build a nearly complete collection of each month's issue of Hemispheres magazine. I even bought a little stock (which rose rapidly in value and then, of course, became virtually worthless).

What a difference "deregulation" and a few bankruptcies can make.

Air travel never did make a lot of sense as a transportation system. (Can you imagine how Bob Newhart might have played the banker being pitched by the world's first airline for a loan?)

o Moving a multi-ton container off the Earth, into the atmosphere, takes an enormous amount of fuel -- not to mention the harm done to the ozone layer and greenhouse effect from the exhaust.

o Any transportation system that depends on favorable weather conditions is inherently unreliable -- especially when its marketed "advantage" is the "speed" represented by an on-time arrival that can so easily be affected by snow, sleet, ice storms, fog, dangerous winds, and other conditions that are mere inconveniences for travel by train, bus or automobile.

o Aside from the fact that "your seat cushion becomes a flotation device" when your plane falls into the drink, the container does not "become a boat" when that happens, nor is there any other "fail safe" option (as with a car simply going into a ditch) if the system fails.

o Part of the reason I pushed containerization when Maritime Administrator is that I early on discovered 90% of the cost of moving cargo was incurred within 10 miles of the port; the trip across the Pacific was virtually free. So it is with air travel. You need to allow a margin of error for (a) the time it takes to pack the car and leave the drive (or wait for the shuttle) and get within the vicinity of the airport (allowing for the possibility of traffic congestion, accidents, or a train parked on a railroad crossing), (b) find a place to park and drag your bag to the bag check, (c) the line at the check-in counter which can take anything between 2 and 45 minutes, (d) ditto for the security check that requires you to remove all metal along with your shoes and laptop, and then dress and repack, and (e) the walk to the gate. (f) This is on the assumption there is actually a plane at the gate. For any one of a long list of reasons it may not yet have arrived. Or, if it's arrived, there may not be a crew. (g) Then there's the sitting on the tarmac waiting for clearance to take off. (h) The delay, and possible cancellation, because of maintenance needs. (i) Any possible delays during the flight due to weather or other factors, and (j) congestion at the destination airport, or (k) the fact there is no gate to park at, or jet walkway at the gate. At which point there's a similar routine regarding (l) your connecting flight, or if your destination, (m) waiting for your bag (which may not have arrived), (n) getting ground transportation, and (o) the time of the trip to your ultimate destination. Not to mention the high prices for tickets, and the nickle-and-dime extra charges for checking a bag ($15), or avoiding starvation.

o On my flight to California there were four legs: a flight from the Eastern Iowa Airport (CID) to a regional hub, the flight to San Jose, the flight from San Jose to a regional hub, and the flight back to CID. On three of those four flights there were cancellations or delays (in one case the necessity of transferring to another airline) because of the last-minute discovery of necessary repairs. One involved a defective switch that controls the part of the plane that provides the lift necessary to get it off the runway. Another involved a defective brake -- necessary to keep the plane from going off the runway. And the third was something I've never encountered before: (a) the need to remove fuel because there was too much on board and (b) the necessity to balance up the fuel in the tanks because it was so much out of balance that the plane couldn't fly. Now I ask you, could none of these problems have been anticipated or discovered prior to the moment of take off?

o While I'm on this rant, here's one more. If you buy 100 head of cattle and only get 87, or a dozen bagels and there are only 10 in the bag, you -- and the person who sold them to you -- expect that you will ask for, and receive, either a refund or the additional goods. What are you buying with an airline ticket? Speed of travel; arrival at a fixed time. As a result of the maintenance work, and necessary change of airlines, I missed an event in California I was scheduled to attend -- and for which I had allowed plenty of extra time in the travel schedule. When you do not arrive at your destination at the scheduled time -- for whatever reason -- you are not getting what you purchased. There is a "loss" associated with that delay -- for everyone on the plane. We can argue about how we should go about calculating the economic value of that loss, but that there has been a loss is clear. The question is, how should it fall; who should bear it?

If it is important to you to have something constructed by a particular time you can build into a construction contract provision for a bonus if it is finished on time, or a penalty if it is not. But we don't have such a provision in our contracts with the airlines -- nor do we have the bargaining power to negotiate for it. So the entire loss falls on us, the customers, those who have the least responsibility for the delay.

In sum: The airlines have become dysfunctional. Just one more reason why, while we're about the business of rebuilding our disintegrating early-Twentieth Century infrastructure we need to give really serious consideration, and funding, to rebuilding our passenger rail transportation system.

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Anonymous said...

People have been watching your blog for some type of analysis of the conservation vote coming up, the one where you and your wife sit on the board? You know, an analysis of the budget, the business plan, etc. The detailed plans about what happens to the land after purchase and who pays for it...the answering of questions related to conflict of interest...why we are expected to give away $20,000,000 without no more information that a one-page flyer and the exact one-page website???

We have come to expect greater thought on matters pertaining to our tax dollars. We expect more of you, Nick. How would a banker analyze your request for tax dollars? How should the general public? How can one vote on something with no details? Is it a desert topping or what?

Anonymous said...

I hope this information is helpful:

What does the actual ballot say?
Shall the County of Johnson, State of Iowa, be authorized to acquire and develop lands with public access provided, to be managed by the Johnson County Conservation Board, in order to protect the water quality in rivers, lakes and streams; protect forests to improve air quality; protect natural areas and wildlife habitat from development, and provide for parks and trails, at a cost not exceeding $20,000,000 and issue its general obligation bonds in an amount not exceeding $20,000,000 for that purpose, to be repaid in not more than 20 years? All expenditures will be subject to an annual independent audit.

Is there a plan?
The County Conservation Board is creating an additional strategic plan (adding to their current plan) for conservation should this initiative pass. They have already had five public input sessions throughout the county and have had several planning sessions. The meetings are open to the public and input is welcome. They must vote on acquiring land and those land purchases also must be approved by the County Board of Supervisors, thereby creating several layers of transparency.
The public and conservation board are very concerned about water quality, watershed protections, and natural flood prevention. Wetlands, buffer strips, prairies have multiple beneficial qualities. There is also an interest in buffering existing parks, such as Kent Park, Hills Access, etc. Two trail corridors have already been identified -- Solon to Ely to tie into the Linn County Trails that connect to Cedar Falls (eventually tied to North Liberty and Iowa City) and Tiffin to Kent Park (which will eventually tie Coralville to the Amana Colonies).

Why don't they know specific lands that they will purchase?
They do know the two trail corridors that are already identified. The County doesn't know what lands will become available for sale in the coming year. Please remember that land will not be condemned. That means the land owner has to be willing to sell, sell below market value, or donate land. A previous ballot issue created Kent Park. But the County is unlikely to create a big park. Because big parks take an enormous amounts of money to develop and annual maintenance budgets. We can get a lot more beneficial water protection and natural areas if we acquire property in strategic areas. Any land along a river, lake or stream is of interest; any land abutting existent green space; any land that has unique natural features or original prairie remnants; any land that connects green areas. It is impossible to identify specific land when we just don't know what will become available over twenty years.
This is not dissimilar to school issues, when we know we are bonding to build schools, but we don't know the specific location. In this case we know we are voting to build more wetlands, prairies, woodlands and trails, but the specific locations will need to have some flexibility, but will be subject to public meetings and votes by the board.