Genius doctors who actually do get paid 20X the fair price for procedures

by philg

Loyal readers may recall my previous posts on the subject of how health care providers in the U.S. are able to bill 10-15X the fair price to patients, accept the fair price from insurers, and chase after the uninsured for the absurd price. The latest: $1559 of lab work for $103. See also Recent health care scams.

The New York Times took a rare break from its “Bad Things about Donald Trump” coverage to write about some doctors who manage to collect at absurd multiples of the fair price, but from the insurance companies. “A $440,000 Breast Reduction: How Doctors Cashed In on a Consumer Protection Law” (NYT, April 22, 2026):

Dr. Norman Rowe, a plastic surgeon with offices in New York and Florida, advertises on his website that breast reduction surgery usually costs between $15,000 and $25,000.

But these days, his practice sometimes earns $440,000 for the procedure.

Dr. Rowe has taken full advantage of a new arbitration system, part of a major consumer protection law Congress passed in 2020 with bipartisan majorities. The No Surprises Act was designed to eliminate surprise medical bills, for patients who showed up in the emergency room and were treated by a doctor who didn’t take their insurance.

It bars those out-of-network doctors from billing patients directly. Instead, they can plead their case to a government-approved arbitrator. If they win, the patient’s insurer has to pay their desired amount.

By all accounts, the law is successfully protecting patients against bills from doctors they never chose. But it has also generated an expensive unanticipated consequence: Doctors have flooded the arbitration system with millions of claims. Most are winning, often collecting fees hundreds of times higher than what they could negotiate with insurers directly or what they could have earned from patients before the law passed.

When the law passed, government officials estimated that about 17,000 cases would go to arbitration a year. Instead, doctors brought 1.2 million such cases in the first half of last year, and won around 88 percent of them.

The arbitrators are doing well too. The fees they earn for deciding cases, which range from $425 to $1,150 per case, have added up. They earned $885 million from 2022 to 2024.

The chart shows that doctors get smarter every year:

How does it function in practice?

In arbitration, doctors and insurers each propose a price for the care, along with arguments for why it is appropriate. An arbitrator must pick one of the two numbers, and there is no opportunity to appeal the decision.

A neurosurgery practice outside of Philadelphia went to arbitration after the health plan Highmark offered its standard payment of $2,660 for a diagnostic procedure to measure blood flow to the brain. An arbitrator awarded it $333,000 instead.

(Let’s say that the “diagnostic procedure” is done with an MRI machine, which I think is the most expensive machine used in medicine. So the single procedure, which takes less than one hour, paid 100% of the cost of a refurbished machine or about one third of the cost of a new machine.)

Some practices are using the law to obtain high payments for routine medical care, including gynecologists who have won fees 600 times higher than usual rates for placing intrauterine contraceptive devices, or I.U.D.s.

Health policy experts have been surprised to see such lopsided results that favor doctors. Some argue that because the arbitrators are paid per case, they may have an incentive to render decisions that keep doctors coming back.

Just like Family Court! Divorce litigation that keeps everyone busy and highly paid is rare in jurisdictions where divorce litigation isn’t lucrative.

The first doctor profiled seems to have a lot of fun:

Dr. Rowe has practiced for decades on New York City’s Park Avenue and in New Jersey. Last winter, he opened an office in Palm Beach, a few miles from President Trump’s Mar-a-Lago resort. Just before the inauguration, he told The New York Post the office had been overrun with clients who wanted to look good when they “have face time with the leader of the free world.”

Dr. Rowe did not respond to multiple requests for comment from The Times.

On social media, he flaunts a lavish lifestyle. An Instagram post in February detailing his 60th birthday party featured a performance from the rapper 50 Cent and a custom-cake recreation of his 1950s vintage Porsche.

Sometimes the best paperwork is no paperwork:

Before the No Surprises Act, Dr. Rowe’s practice was out of network with EmblemHealth, but he accepted fees $30,000 or lower for hundreds of breast reduction surgeries, the lawsuit claims.

In 2024, the lawsuit says, he started routinely performing surgeries on EmblemHealth patients in hospitals that accepted the insurer’s in-network payments, though he still did not.

Under the No Surprises Act, doctors in such situations can provide patients with a waiver that warns of additional costs. If patients sign that form, the doctor has permission to bill them directly.

Dr. Rowe does not hand out that waiver. That allows him to take his payment disputes to arbitration.

He and his practice have filed more than 6,000 arbitration claims, according to an analysis of public filings from the Georgetown University Center on Health Insurance Reforms. He has won more than 85 percent of his cases.

What do our esteemed politicians have to say about this massive siphoning of GDP?

“My focus is on ensuring everyone can get the care they need without worrying about the cost,” said Patty Murray, Democrat of Washington, who helped craft the bill.

What’s incredible to me is that the U.S. economy survives our health care system!

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How were race-based congressional districts supposed to work in our open-borders age?

by philg

The Supreme Court recently ruled against a race-based congressional district in Louisiana. It was developed under the Voting Rights Act of 1965 (VRA) in order to give Black voters a chance to elect a candidate of their choice. 1965 was the same year that we opened our borders via Hart-Celler. I’m curious to know how the laws were ever supposed to work together. It seems that the VRA envisioned a majority-minority split between just two groups: white and Black. After Hart-Celler, though, a state could easily have the following:

  • a white minority (under 50%)
  • an Asian-American minority (we’re informed that all varieties of Asians, including Indians and Samoans, can be lumped together under AANHPI, Asian American and Native Hawaiians/Pacific Islander) that wants to elect a fellow Asian-American, such as the noble Ted Lieu (proof that not everyone from Taiwan believes in a government that spends only 18% of GDP, including state/local)
  • a Black minority that wants to elect someone like Kamala Harris
  • a Hispanic minority that wants to elect someone Hispanic
  • an Arab minority that wants to elect a fellow Muslim Arab (BBC: “This month, the Midwestern city of 28,000 has reached a milestone. Hamtramck has elected an all-Muslim City Council and a Muslim mayor, becoming the first in the US to have a Muslim-American government. Once faced with discrimination, Muslim residents have become integral to this multicultural city, and now make up more than half its population.”)

If the VRA isn’t specifically limited to one racial group, which it doesn’t seem to be, who decides which of the above minorities will get its own district and which will see its votes diluted and its dreams denied?

Loosely related, in the Department of Diversity is Our Strength:

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Is it bad that Florida is no longer affordable for the middle class?

by philg

Recent Wall Street Journal article, “Florida’s Population Boom Fizzles as High Costs Drive Away Middle Class”:

Florida’s migration patterns are changing dramatically. Residents in their prime working years are heading to other states, often citing affordability concerns. At the same time, the stream of people arriving from other states is shrinking.

Meanwhile, an influx of wealthy people from other states—turbocharged during the pandemic—has helped drive up home prices. Inflation in parts of Florida outpaced the national average over the past decade and home-insurance rates soared.

These side-by-side trends could spell trouble for a state whose economy relies on continued population growth and real-estate development.

“The affordability picture has changed in Florida almost more than anywhere else in the country,” said Eric Finnigan, vice president of demographics research at John Burns Research & Consulting.

First, note the assumption that underlies almost all American politics: infinite growth should be the goal. (Never mind that growth without limit in an organism, and without regard to available resources, is known as “cancer”.)

Second, the WSJ implicitly assumes that a place that is affordable is better than a place that is unaffordable for median-income residents.

Third, the WSJ lumps all of “Florida” together. Florida is about the same size as all of New England. The WSJ wouldn’t lump together Boston and western Maskachusetts, much less Bridgeport, Connecticut and Houlton, Maine. (It’s still possible to get a brand-new single-family house in central Florida for less than $300,000, though the same can’t be said for coastal Florida; the house will be about 1500 square feet, which is the size of the house I grew up in (family of five) and with the added advantage that Floridians don’t need as much indoor space.) The most convenient housing for a SpaceX or Blue Origin engineer is in Titusville, where a decent (not new) house can be purchased for $300,000 (relocation guide).

Fourth, the WSJ assumes that the market is full of stupid people who bid up the prices of houses in places that aren’t desirable. Single-family home prices are $10.15 million in Palm Beach and $212,000 in Dearborn Heights, Michigan, where Ayman Ghazali mostly peacefully lived. From this we can infer that living among Iraqi and Lebanese immigrants in Dearborn Heights is better than living among Manhattan immigrants in Palm Beach (perhaps not an unreasonable inference!).

Maybe in a country with a shared language and culture it would make sense to try to find an inexpensive place to live. However, in a country that is jammed with low-skill migrants from all of the world’s most violent and dysfunctional societies (our asylum-based immigration system ensures that someone from Switzerland or Japan goes to the back of the line), isn’t it actually an advantage from a typical native-born perspective that a place is out of reach for the median present-day American? Google AI: “Newport Beach has lower racial diversity and worse racial disparity across various indicators compared to the average for California cities.” Given the stratospheric real estate prices, it seems that a lot of people are willing to pay for low racial diversity and “worse racial disparity”. As of 2021, the town was supposedly 85 percent white (source):

The Dallas metro area is more affordable than most parts of the US with jobs, which has enabled a mostly-immigrant community of 130,000 Muslims to set up more than 60 mosques and lay out EPIC City, “a master-planned Islamic community-centered residential development project”. Non-Muslim Americans who don’t want to hear the muezzin calling five times per day might prefer to spend more on a house that is in an area that is “unaffordable” to immigrants from Syria, Egypt, Afghanistan, and Somalia.

We could take this to an extreme. Aspen, Colorado is absurdly unaffordable for the median worker. My friend doesn’t like Aspen (see An actual skier goes to Aspen to ski), but apparently a lot of people do like it. Would we say that Dearborn Heights, Michigan is a better place to live than Aspen? That Aspen is bad because the population isn’t growing 3% per year like Gaza’s or Somalia’s? (Maybe Gaza and the West Bank are the ultimate examples of affordability. US and EU taxpayers pay for all of the basics, e.g., shelter, food, health care, education, etc. Nobody needs to work. Hamas-ruled Gaza is a model society by Ivy League standards, but wouldn’t the typical American rather be in St. Barts, Aspen, or Nantucket (all of which rank near the bottom for affordability on a median income)?) We could also consider a massive public housing project in Chicago or New York City. They’re “affordable” by definition since no tenant is charged more than 30% of his/her/zir/their income (often 30% of $0 since the tenants aren’t stupid!). Would a typical American prefer to live in the 6000-person Queensbridge Houses (“well known for its contributions to hip hop and rap music”; “a problem with drug dealers and drug users”) or in Atherton, California (population 7,000; home to Larry Ellison before he spent $450 million to escape to Florida)?

In short, given the continued flood of low-skill migrants (70 million since 1976) maybe “affordability” shouldn’t be the goal for any city or state that seeks to maintain a pleasant environment.

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Fifth anniversary of our first family trip to Jupiter, Florida

by philg

Flash back to April 2021, Meet next week in Jupiter, Florida?:

We’re escaping to the Florida Free State for the Maskachusetts school vacation week (April 18-25). A journey of 1,000+ miles is the best way for the kids to get a “mask break” (under what would be the “law” if it had been passed by the legislature instead of merely ordered by the governor, walking outside one’s yard, even at midnight in a low-density exurb, is illegal without a mask).

The post cited an NBC article on the continuation of the #Science-driver outdoor mask order in Massachusetts and referenced Relocation to Florida for a family with school-age children (explains the rationale for Jupiter).

We stopped in Savannah, Georgia on our way to Jupiter. They were still under an outdoor mask order:

The kids learned about fishing from unmasked folks at Juno Beach Pier (Florida):

Having left the wet cold masked Boston spring, we encounter a crowd of unmasked people in shorts eating dinner outdoors in downtown Abacoa:

While folks in Massachusetts continue social distancing, a crowd gathers at the bow:

On the return trip, we stopped in Asheville, North Carolina, where they were solidly in masks-required territory more than a year after coronapanic began:

Biltmore tour group:

Back home to Hanscom Field, one part of the Boston area that I miss. Inequality in white:

Also in masketology, this photo is supposedly from 2020, but where was it taken? Google Image Search finds some examples of it from 2020 so it wasn’t done with AI and the date is correct, but does anyone recognize the city?

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New York Times searching for a motive

by philg

Like OJ searching for the real killer, the New York Times is trying to figure out what could have motivated a patriot to try to kill a person whom the New York Times characterized as literal Hitler. The front page right now:

In case you too are searching for a motive, the New York Post published “Cole Allen’s full anti-Trump manifesto”:

And I am no longer willing to permit a pedophile, rapist, and traitor to coat my hands with his crimes.

(Well, to be completely honest, I was no longer willing a long time ago, but this is the first real opportunity I’ve had to do something about it.)

I would still go through most everyone here to get to the targets if it were absolutely necessary (on the basis that most people chose to attend a speech by a pedophile, rapist, and traitor, and are thus complicit) but I really hope it doesn’t come to that.

Objection 1: As a Christian, you should turn the other cheek.

Rebuttal: Turning the other cheek is for when you yourself are oppressed. I’m not the person raped in a detention camp. I’m not the fisherman executed without trial. I’m not a schoolkid blown up or a child starved or a teenage girl abused by the many criminals in this administration.

Turning the other cheek when someone else is oppressed is not Christian behavior; it is complicity in the oppressor’s crimes.

Objection 4: As a half-black, half-white person, you shouldn’t be the one doing this.

Rebuttal: I don’t see anyone else picking up the slack

Related:

From the above, a New York Times reminder that the righteous might want to eliminate a “danger”:

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New York Times: Family disintegration leads to military disintegration

by philg

The New York Times’s latest explanation for why we can’t win wars… “You Can’t Defend a Nation When Soldiers Don’t Have Child Care”:

After the draft ended in 1973, the composition of the armed services began to change. More women, people of color and lower-income Americans joined up. A steady paycheck became “the principal rationale to induce persons to join the all-volunteer force,” according to testimony given before a 1978 Senate subcommittee hearing on the Army. One unanticipated consequence was the growing number of families with young children living on Army bases. “At times of alert,” Representative Robin Beard, a Tennessee Republican who had written a report on the Army, told the subcommittee, “the battalion headquarters and company headquarters would be filled with children.” Soldiers with children had “no place to take” them.

The child care problem wasn’t limited to emergencies. As costs rose relative to incomes, more military spouses had to enter the work force, and child care gaps became constant.

From 1985 to 2022, the number of active-duty single parents in the military increased 67 percent…

We supposedly have a fertility collapse among native-born Americans in the aggregate, but a baby boom for unmarried (“single parents”) members of the military. Maybe this is because women who are deployed are highly likely to become pregnant? “Active duty servicewomen have high rates of unintended pregnancy” says this 2013 paper, which cites “difficulties faced by deployed women”:

I’m still waiting for our lavishly funded military to disable Iran’s oil production and electric power generation so that the country can’t rebuild and restart its weapons factories. Maybe the military is waiting for me to go to the nearest base and take care of a toddler?

Loosely related, a U.S. senator from Connecticut roots for the Islamic Republic of Iran:

He/she/ze/they previously said that the war was “illegal” (which means that anyone in the U.S. military can refuse orders to participate?) and said our military effort was “destined to end in failure” (due to lack of child care?):

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Lionel Shriver on why an American or European might oppose immigration on nonfinancial grounds

by philg

We’re informed that low-skill migrants make a country rich. If this is true, could there be any rational basis for opposing open borders? From Lionel Shriver’s A Better Life, a conversation between a Honduran and the 27-year-old son in her Brooklyn host family (“Big Apple, Big Heart” program):

“America is rich.”

“America is broke—thirty-three trillion dollars in debt, and a couple trill more every year.”

“Los inmigrantes take small money.”

“Small money adds up.”

“You is crowded? This house, three bedroom with nobody. In Honduras, thirty, forty people live here, no hay problema.”

“Okay, no, I’m not personally crowded.”

“You no pay. You no crowded. Why big feeling?”

“The ‘big feeling’ has to do with home. Home isn’t only a place; home is a big feeling. That you belong. That you can understand the people around you, and they can understand you, because you’re mostly the same.” Nico was struggling for a definition that didn’t stray into the tar pit of race. He resorted to Google’s conversation mode. “It’s about feeling comfortable and welcome and not having to try very hard. It’s a place where people laugh at your jokes, and you laugh at their jokes. You can sing some of the same songs. You watch some of the same TV programs. You know you can trust most people, and you know how to recognize the people you can’t trust. When your home fills up with people from somewhere else. Who speak different languages so you can’t understand each other. Who think different things. Who have no deep connection to your home, no ‘big feelings’ for your home. No history there. Who often . . .” Here he hesitated; this was awkward face-to-face, but he remembered Palermo’s unflattering characterization of her brother as only braving negative sentiments about people behind their backs. “Who often come to your home to take advantage, to see how much they can take. Well, then your home doesn’t seem like a home anymore. It seems like anywhere. It makes you sad.”

Of course, rich people in the U.S. can escape the above by moving, e.g., to an all-white ski town in the winter and an all-white beach town in the summer. The only migrants they’ll encounter are deferential service workers (i.e., servants). It is the middle-class resident of Dearborn, Michigan who might be forced by economics to stay in a neighborhood that has become almost entirely Arab-Muslim. It is the middle-class resident of Elmhurst, Queens who doesn’t have the resources to move away when every other family on the block speaks primarily Mandarin.

(I recently met a reasonably-rich-via-trust-fund older lady who’d moved after decades in Key Biscayne, Florida. It was mostly non-Hispanic white when she moved there. It’s now over 70 percent Latinx. Despite being a lifelong Democrat, she unashamedly said that she’d moved to Florida’s Treasure Coast because she was tired of hearing Spanish spoken all the time and not being able to communicate with everyone she encountered in a shared language (she hadn’t learned significant Spanish). ChatGPT: “Key Biscayne went from almost entirely non-Hispanic in 1960 to a Hispanic-majority community by ~2000, and today is roughly two-thirds Hispanic.”)

Loosely related, a visualization of migration into Europe. It would be interesting to see one for the 70+ million migrants who’ve entered the U.S. since 1976 (Pew).

It is possible to see a visualization of “illegal immigrants” (the undocumented, in other words), but only since 2020. And the people who’ve transformed the U.S. in the most profound ways have been legal immigrants.

Related, legal immigrants admitted by qualified government experts under laws passed by our wisest citizens (Congress):

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Good news for gold bugs: houses are cheap

by philg

Happy National Fair Housing Month (“A Fundamental Right, Year-Round”; for Americans dumb enough to work: the “fundamental right” is to pay taxes so that others can relax in public housing) to those who celebrate.

Recent message from a friend who was smart enough to sell everything in Maskachusetts and buy in Texas in early 2009:

My contrarian view: Real Estate prices are at an all time low….. if measured in gold

Given that peasants can’t afford to buy at current prices/mortgage rates, my first reaction was “this is dumb”. On the other hand, I think my friend is closing in on billionaire status due to his previous real estate investments so maybe it is me who is dumb.

There is some support for his theory from this chart (source):

Does this make sense, though? Gold can be purchased by anyone in the world as an investment or for decoration. It is easy to transport. Residential real estate is impossible to transport and most of it has to be purchased by or rented by someone who lives where the real estate is. Rich people in Switzerland, India, San Francisco, Miami, and Singapore might buy up all of the world’s gold, but they’re not going to pay anything for a house in Detroit.

We’re now at a point where it takes 40-45% of a median household income to pay the mortgage on a median-priced house (source), i.e., back to the situation circa 2006 at the peak of the real estate bubble that burst in 2008:

This reflects the prevalance of two-income households since it looks at median household income. In the old days, the man worked and the woman stayed home (those days were so old we could tell the difference between a man and a woman!). Now everyone is in the workforce, except those smart enough to live in public housing, and the monetary fruits of all that extra toil are scooped up by real property owners. Median household income is a mixture of single-income and dual-income households. Houses are priced right now to be a stretch for the median household, which I guess means that they’re affordable for median two-income households and entirely unaffordable for a median one-income household. I asked ChatGPT “What’s the difference in median household income for one-income vs. two-income households?” and it came back with $70,137 for one-earner “family” and $127,256 for two-earner families from Census ACS data, cautioning that “Family is narrower than household. A household can be one person, roommates, an unmarried couple, etc., while a family is related people living together.” It added “For context, the overall 2024 median household income was $83,730.”

So… I’m pretty sure that my friend is wrong, which makes me+Google+ChatGPT smarter than a billionaire! There’s a first time for everything.

Also from my friend, bad news for people who love open borders and/or high birthrates, both of which necessitate new housing construction:

on the construction side, prices went crazy during [coronapanic] and never came down. It is now about 50% more expensive to build anything as compared to 2019.

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Predicting the effects of AI on labor markets by looking at container shipping (a book about the Box called The Box)

by philg

I hope that everyone who celebrates is having a meaningful National Supply Chain Integrity Month.

I recently listened to The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson, against whom I was somewhat prejudiced because he has worked as an editor for The Economist, a magazine written and edited by experts who never met a human.

It’s a suprisingly interesting book on an uninteresting subject. The author is an economist so he is expecially weak on the engineering challenges of building ever-larger container ships and cranes. Nonetheless, we do learn about some of the engineering that went into designing the containers themselves, e.g., the corner connectors and figuring out how to support the weight of additional containers piled on top.

Like AI today, container shipping was perceived in its early days (1960s) as potentially saving a huge amount of human labor, especially dockside. Breakbulk shipping required large crews of longshoremen working for days to pack items into cargo holds, thus giving the mariners a relaxed week in port. Because longshoremen were usually unionized and had the power to shut down ports completely, they were able to negotiate the transfer of a massive share of the expected profits from container shipping to their members, either for not working at all or for working part-time. Non-unionized workers in the breakbulk shipping industry were completely out of luck. Future workers were also out of luck. As members of longshoremen unions died, the benefits of the union contract flowed only to those who were still alive and/or working. Crane operators in Los Angeles can make over $300,000 per year, but there aren’t many of them.

Practical advice for young people: Get a union job now and in a union that can shut down something important to the rest of the economy and/or the public. If containerization is any guide, unionized schoolteachers will be able to keep their wages even if Optimus can teach better. It would be ideal if one could think of a union that can shut down all AI data centers, but I am not sure there is one. Maybe the people who handle cooling? Even then, however, the data centers theoretically have the right to hire replacement workers during a strike. (School districts have this right too and it would be trivial to hire some adults to take over teaching/daycare responsibilities, but they don’t do it because, I guess, the union and the people who run the city are part of the same political party.)

Container shipping caused a massive shift in employment. Docks and their associated jobs in Manhattan and Brooklyn disappeared. So did factories that had been close to the docks in order to faciliate shipping to Europe. The replacement was Port Elizabeth in New Jersey, set up in 1963 to handle containers for Malcom McLean‘s Sea-Land. The factories moved to Upstate New York, Pennsylvania, Connecticut because with container shipping they just needed to be able to put a box on a railroad car headed for Port Elizabeth.

The advent of container shipping did not highlight the merits of technocratic government or credentialed experts. Governments, armed with expert advice and forecasts, were investing huge quantities of tax dollars in wharves for breakbulk ships just as the container boom was becoming established. Experts predicted minimal savings and disruption from containerization, perhaps partly due to government regulations that stifled the growth of the industry. Until President Gerald Ford kicked off the deregulation trend in the U.S., rates for shipping via rail and truck were set by a central planning agency (the ICC). International shipping rates over water were similarly regulated by a combination of bilateral agreements, cartels among shipping lines, etc. The rate to ship a load of refrigerators, for example, might not be different whether they were in a container or not. It wasn’t until the 1980s that the full benefits of containerization began to be experienced by shippers and consumers. In other words, government intervention in the market delayed the benefits of the technology by 15-20 years.

As with AI, which has made receptionists at NVIDIA richer than 99% of the people who live in Michigan (Detroit was once the richest city in the US and maybe the world!), the benefits of container shipping haven’t been equally distributed. A privately-owned non-union (at the time) port in Felixstowe took away thousands of jobs from unionized government-owned ports in other parts of the UK. Intelligent and efficient countries got dramatically richer, e.g., Singapore and the Netherlands, while countries that couldn’t get organized were left much farther behind than in the breakbulk days, where everyone was inefficient. It’s almost free to ship cargo among the world’s leading container ports and expensive/slow to ship cargo to places that aren’t regularly visited by big ships. The cycle tends to be a virtuous one. Because Panama has a busy container port that’s also the logical place to put factories that divide up and repackage pharmaceuticals for re-export to other Latin American countries. Being a landlocked country was already bad, but the penalty increased with containerization. (Our family experienced this with roofing tile. We got $30,000 of clay tiles from Spain, including container shipping and a truck ride up from Miami. It was going to cost $16,000 for tiles from Ohio…. just for the shipping.)

Consider Haiti, one of the world’s most violent and dysfunctional societies (which is why the U.S. is eager to import as many people from this society as possible?). It also has a violent and dysfunctional container port. UNICEF:

Armed groups breached the city’s main port a week ago, severing one of the capital’s last remaining lifelines for food and supplies as the country edges closer to collapse. Currently, over 260 humanitarian-owned containers are controlled by armed groups at the port.

Even if the rest of Haiti weren’t violent and dysfunctional, no factory could be set up profitably given the violent and dysfunctional nature of the port.

Moving over to the most functional country in Sub-Saharan Africa… “South African ports still rank among worst in the world” (BusinessTech 2025):

State-owned Transnet Port Terminals is pouring investment into cranes and new equipment after years of corruption and mismanagement that eroded the quality of its operations. The Container Port Performance Index from 2020 to 2024 took note of the upgrades and measures, including better weather forecasting at two local facilities. … Still, Cape Town was 400th in the survey, with Coega and Durban the penultimate and last of the 403 ports ranked.

The countries with high-ranked container ports are likely to be more advantageous spots for factories, at least the parts of those countries connected by good rail links to the efficient ports. Note that even today it can cost more to ship a container a few hundred miles by rail than thousands of miles by ship.

Also interesting from the above-cited report, what happens when you compare the best that Americans can do, considering all union and cultural factors, to our brothers, sisters, and binary-resisters in Asia?

(Note that some of this inferior performance might be robot vs. human. American unions have had a lot of success in obstructing the installation of automation at our ports.)

So… if the AI revolution turns out to have dramatic economic effects, as predicted, the benefits will be radically unequal. Maybe Californians won’t complain so much about inequality if it turns out that nearly all of the wealth of the U.S. ends up in California as a result of the AI economy? Will they be eager for federal tax policy that plucks wealth from California AI Achievers and pays it out to Left-Behind Mainers and Michiganders?

Can we predict the people and places that the AI boom will enrich the most? I hope that SE Florida will be fine, even if money is earned elsewhere in the U.S., thanks to the spectacular mismanagement and consequent high taxes of a lot of other parts of the U.S. (Maybe Jensen Huang will eventually retire and bring his personal $trillions to tax-free Florida?) California is an obvious candidate for a place where a lot of individuals will keep getting richer, but mostly the rich AI nerds will leave the other 40 million Californians in the dust.

Maybe the answer is that AI is most useful to the smartest humans and, therefore, the big winners from AI will be the smartest humans and places where smart humans cluster. This was the core point of the book The Bell Curve, improperly characterized as a book about IQ as a function of race. In fact, the main point is that, unlike in medieval times, the modern industrial economy delivers enormous rewards to the smartest people. A potato-picking peasant in 1500 who happened to have an IQ of 130 wasn’t going to earn a lot more than his counterpart with an IQ of 100. If AI accelerates the trend identified by The Bell Curve then maybe Korea, China, Japan, Singapore, and Taiwan will be the ultimate winners. (Average IQ in the U.S. started to fall shortly after our post-1965 opening of our borders to immigrants from countries with lower-than-100 IQs.)

Containerization was invented by an American. The first purpose-built container ships were built in U.S. shipyards. All of the early leaders in container shipping were American companies. One of the biggest early adopters of container shipping was the U.S. military (to support our ultimately futile efforts in South Vietnam). Today, however, the U.S. is insignificant in building and operating container ships. Merely because the world’s current AI leaders are in the U.S. we shouldn’t be complacent!

Readers: Who wants to make some predictions?

Fresh on X today, from the Financial Times, about how AI makes the cognitive elite more elite (i.e., another reason why the majority of Americans will eventually vote for everything that Bernie Sanders, Elizabeth Warren, and AOC propose):

(Photos from Panama, 2023)

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Instead of free public transit, how about congestion rebate public transit?

by philg

Happy Earth Day to those who used to celebrate before they moved on to Queers for Palestine, etc.! And what better way to celebrate Earth Day than to get on a clean soot-spewing diesel-powered bus? “It’s where America’s poor and very poor can meet,” a friend pointed out.

Ayatollah Mamdani wants to bring free bus service to the Manhattan Caliphate, though it seems as if the dream is deferred (“Zohran Mamdani backs down on cornerstone campaign promise of free NYC buses” (NY Post)). A Republican in the NYC woodpile objects because “free busses will inevitably turn into rolling homeless shelters and drug dens, and become miserable and dangerous for the people who actually need to utilize them”:

(Wokipedia on the horrors of this Deplorable harpy: “Paladino has openly expressed Islamophobic and homophobic views. She has also opposed pro-Palestinian protests during the Gaza War, squatter houses, Drag Queen Story Hour, congestion pricing, and COVID-19 vaccine mandates.”)

As someone who loves Zohran and hates sitting in traffic jams, I’m a believer that public transit should be free and, actually, negatively priced during peak traffic congestion. On the other hand, maybe Vickie Paladino is right that “free” in a filthy city such as New York doesn’t attract the best people.

How about if people pay the usual fare when boarding, but via a smartphone app become eligible for a monthly rebate that is paid via Zelle. The unhoused New Yorkers and drug-dealing New Yorkers whom Paladino doesn’t want to encounter aren’t likely to have bank accounts and, therefore, aren’t likely to be able to get rebates via Zelle.

The rebate would vary by the ride and time of day and be linked to congestion on the roads. Someone who rode the bus during rush hour (that’s 8 am to 8 pm in NYC?) would get a rebate larger than whatever the fare is cranked up to. Someone who rode the bus at midnight wouldn’t get a rebate, which aligns pretty well with transit system costs because it is expensive per rider to maintain a schedule at night when ridership is low.

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