Congressional Committee Sizes

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In today’s New York Times, Tom Friedman writes:

Our Congress today is a forum for legalized bribery. One consumer group using information from Opensecrets.org calculates that the financial services industry, including real estate, spent $2.3 billion on federal campaign contributions from 1990 to 2010, which was more than the health care, energy, defense, agriculture and transportation industries combined. Why are there 61 members on the House Committee on Financial Services? So many congressmen want to be in a position to sell votes to Wall Street.

What an interesting proposition: The size of a Congressional committee will be directly related to the availability of campaign contributions and lobbyists. Growing (shrinking) committees are related to increased (decreased) campaign contributions and lobbyists.

This same logic suggests that: The total number of committees and committee memberships will likewise be directly related to the availability of outside funding. As total spending on contributions and lobbyists goes up (down) the number of committees and committee memberships with increase (decrease).

To follow the money, simply follow the ebb and flow of Congressional committees over time. Taken together the propositions above suggest that Congress functions like a market, and not a ballot box.

Numbering the Discontent

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The graphic accompanying a recent New York Times article seems to capture in numbers the sentiments so many have been trying to express lately. Among 31 OECD countries ranked on social justice, the United States is among the bottom 5 overall (just ahead of Greece, Chile, Mexico and Turkey), and in the bottom 5 or 10 countries on 7 out of the 8 indicators ranked. For those of us who were (a) once children, (b) enjoy remaining healthy, or (c) hope to grow old someday, the news is a sobering reality check.

Source: http://www.nytimes.com/2011/10/29/opinion/blow-americas-exploding-pipe-dream.html

Climategate Anniversary

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It’s been nearly two years since the “Climategate” scandal, an episode I have analyzed in-depth with Raghu Garud.

On the heels of the controversy, Richard Muller, a Berkeley physicist and self-proclaimed climate skeptic, launched the Berkeley Earth Surface Temperature (BEST) project to review for himself the temperature data underpinning climate change concerns. A major sponsor of Muller’s study was the Charles G. Koch Foundation (of California Prop 23 fame).

This week Muller announced the results of his project in an op-ed in a Wall Street Journal article entitled: “The Case Against Global-Warming Skepticism.” The piece is subtitled: “There were good reasons to doubt, until now.” As part of the announcement, Muller’s research group released four papers, which collectively corroborate the climate consensus:

The group estimates that over the past 50 years the land surface warmed by 0.911°C: a mere 2% less than NOAA’s estimate.

Although Muller’s study is one more vindication of the science, it is hardly good news for humanity. Moreover, as Jon Stewart points out, Muller’s study isn’t getting nearly the coverage that Climategate did. Perhaps it’s because when it comes to policy decisions facts are so, well, unnecessary.

For further coverage, see the Economist.

Strategic Social Responsibility

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Some interesting sound bites in a recent New York Times article on a large desalination project in China. Although the $4 billion Beijiang Power and Desalination Plant is “a technical marvel,” “the desalted water costs twice as much to produce as it sells for.”

“Someone has to lose money,” Guo Qigang, the plant’s general manager, said in a recent interview. “We’re a state-owned corporation, and it’s our social responsibility.” In some places, this would be economic lunacy. In China, it is economic strategy.

For more in-depth coverage, see Water World’s report on the Chinese desalination market.

Washington Initiative 1183

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I find the stark differences between the distribution and retailing of alcohol on the one hand, and almost any other consumer product on the other hand, to offer a fascinating commentary about US society. No doubt the contemporary wine and spirits industry remains a potentially interesting, if unwritten, chapter in the history of the Protestant ethic and the spirit of capitalism.

In a previous post, I discussed the bizarre shipping prohibitions that still encumber many wine buyers. Today, my attention was drawn to a Wall Street Journal article on a ballot initiative in Washington state aimed at replacing “hundreds of state-run liquor stores with private retail outlets” while also allowing “retailers to buy liquor directly from distillers and negotiate volume discounts.”

To add to the intrigue, rather than an instance of grassroots mobilization, the initiative is being sponsored primarily by corporate interests. Costco has funded almost the entire “Yes” effort, while the Wine and Spirits Wholesalers of America have funded almost the entire “No” effort. The State is involved too, seeing privatization as a chance to generate more revenue. As a result, “[i]t isn’t clear whether a consumer buying a bottle of whiskey would see prices go down.”

In other words, no matter who wins the initiative, consumers may not come out ahead, even though their “interests” are allegedly at the heart of the matter. Instead, what appears to be at stake is simply how the liquor pie gets divided. Costco and Washington state want a bigger piece, while the existing wholesalers and retailers are reluctant to give up what they have had since the end of prohibition. How’s that for reform?

Importing Large Stata Files

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Recently I encountered a problem when trying to use a large Stata file (nearly 10 gb). The file contained data for the period 1981 to 2011, but I only needed data for the period 1991 to 2009. To complicate matters, initially, I didn’t even know the names of the variables in the file, a problem that can be resolved with: 

type "filename"

In this case, it turns out that knowing the variable names proved unimportant. Instead, after a bit of trial and error, I ended up importing batches of observations (1 million observations at a time). Below is the code for several such batches.

*STEP 1
clear
use "1980-2011.dta" in 8000001 / 9000000
gen pct = round((shares / outstanding),.01)
keep if pct >= .05 & pct != .
compress
save blockholders , replace

*STEP 2
clear
use "1980-2011.dta" in 9000001 / 10000000
gen pct = round((shares / outstanding),.01)
keep if pct >= .05 & pct != .
compress
append using blockholders
save blockholders , replace

*STEP N

Step 1 imports a chunk of 1 million observations, and keeps only those in which an investor owns 5% or more of a particular company. About 22,000 out of one million observations meet this criterion. These ~22,000 observations are saved. In Step 2, the procedure is repeated, at which point another ~22,000 qualifying observations are appended to the blockholders file, and the file is saved again. Finally, the procedure is repeated N times until all the observations have been evaluated and only those relevant to my research project have been retained.

Second Top 10 for Sustainability Paper

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This week I received an email from SSRN informing me that my paper with Raghu Garud entitled “Metatheoretical Perspectives on Sustainability Journeys: Evolutionary, Relational and Durational“ was a top ten download for the second month in a row. This time in the Corporate Strategy & Business Policy Network, within the Strategy & Social Policies eJournal.