Bullying, the Corporate Veil, and the Smell of Raw Power

Stopbullying.gov defines bullying as aggressive behavior that includes "An Imbalance of Power: physical strength, access to embarrassing information, or popularity—to control or harm others." and "Repetition: behaviors that have the potential to happen more than once."

I'd add that more often than not, the the point of bullying is not merely for the stronger party to force the weaker party to do his or her physical bidding, but for the stronger party to exact social capitulation. It is about dominance, humilation, and – perhaps most importantly – demonstrating to others exactly who has the power and who does not.

http://online.wsj.com

[ the 7 foot square office is ] a long way from the Soho digs the 34-year-old used to occupy. Mr. Zucker is the former CEO of Maxfield & Oberton, the small company behind Buckyballs, an office toy that became an Internet sensation in 2009 and went on to sell millions of units before it was banned by the feds last year…

Nowadays Mr. Zucker spends most of his waking hours fighting off a vindictive U.S. Consumer Product Safety Commission that has set out to punish him for having challenged its regulatory overreach. The outcome of the battle has ramifications far beyond a magnetic toy designed for bored office workers. It implicates bedrock American notions of consumer choice, personal responsibility and limited liability…

"In March of 2009, we ordered 100 sets of magnets from China. We literally put our last $1,000 each in the business," Mr. Zucker says…

By 2010, the company had built a distribution network of 1,500 stores, including major retailers like Urban Outfitters and Brookstone… sales reached $10 million a year…

On July 10, 2012, the Consumer Product Safety Commission instructed Maxfield & Oberton to file a "corrective-action plan" within two weeks or face an administrative suit related to Buckyballs' alleged safety defects. Around the same time—and before Maxfield & Oberton had a chance to tell its side of the story—the commission sent letters to some of Maxfield & Oberton's retail partners, including Brookstone, warning of the "severity of the risk of injury and death possibly posed by" Buckyballs and requesting them to "voluntarily stop selling" the product.

It was an underhanded move, as Maxfield & Oberton and its lawyers saw it. "Very, very quickly those 5,000 retailers became zero," says Mr. Zucker…

Now, before you re-route power from your snark engine to reinforce your anti-libertarian shields, let me say that I'm not arguing that the government is lacking the the authority to regulate magnets. (For the record, I strongly believe that (a) the Constitution does not give Congress the legal power to regulate magnets, (b) the Constitution does not give Congress the legal power to delegate any such power to an un-elected, unaccountable bureaucracy, but I'm not arguing that right now.)

"How do I know I'm better than you? Because when I sign a piece of paper your life is destroyed, but you can't do the same to me."

Let's accept for the purposes of this blog post that the CPSC has the perfect legal and moral right to regulate magnets. Even if that's the case, I assert attempting to destroy a firm's hard-won retail network before the legal issue is settled is something worse than an unlawful taking. Worse, because robbing Peter to pay Paul at least (a) can theoretically be reversed later if a court holds that it was illegal, and (b) preserves some of the value of the item that is taken and redistributed. Destroying a retailer network is like tearing down a city's walls and salting its fields. After that the resource is of no use to the original owner, it's of no use to anyone else, and it can't be fixed. It's gone.

You might think that my argument is that there is a power imbalance, and hence bullying, when some government bureaucrat with a taxpayer-provided medical plan, a retirement plan guaranteed near-$200k/year salary, bonuses of up to 20% per year, 25 days of vacation per year (in addition to all government holidays), 11 months of sabbatical per decade (with travel, per diem, and salary covered), personal professional liability insurance, and so on destroys the business of a 34 year old entrepreneur and pushes him near bankruptcy.

But, no, that's not what I'm arguing.


I can fight with a handicap, so I'll give the other side this one – I'll stipulate for purposes of this argument that it is entirely reasonable and just and within the intentions of the Founders that various princes and potentates living on the public dime can destroy a self-made man's business by writing a memo.

Sure. Dandy. If ignoring the Constitution and the 9th amendment is what's required to make sure that no 13 year old ever sneaks into a childless yuppie's house and eats a $30 executive toy, then so be it. Let's do it for the children.

No, the point about bullying that I want to call out is this:

http://online.wsj.com

As for the corrective-action plan, it was submitted at 4 p.m. on the July 24 deadline. Yet the very next morning the commission filed an administrative lawsuit…

On July 27, just two days after the commission filed suit, the company launched a publicity campaign to rally customers and spotlight the commission's nanny-state excesses…

"It was a very successful campaign," says Mr. Zucker, "just not successful enough to keep us in business." On Dec. 27, 2012, the company filed a certificate of cancellation with the State of Delaware, where Maxfield & Oberton was incorporated, and the company was dissolved.

But in February the Buckyballs saga took a chilling turn: The commission filed a motion requesting that Mr. Zucker be held personally liable for the costs of the recall, which it estimated at $57 million…

Note that the CPSC isn't demanding that the corporation to pay a fine for damages done by magnets (magnets that it unilaterally, without any scientific evidence or court finding, declared to be unacceptably safe), because it did not identify or enumerate damages.

Note that the CPSC isn't demanding that the former owner of the corporation pay a fine for damages done ( an illegal and unconstitutional piercing of the corporate veil.)

No.

Because the owner had the temerity to back-talk his betters – and worse yet, do it in public – the CPSC is demanding that the former owner of the corporation pay the administrative cost of destroying his company.

Let me repeat something I said at the very start of this post: the the point of bullying is not merely for the stronger party to force the weaker party to do his or her physical bidding, but for the stronger party to exact social capitulation. It is about dominance, humilation, and – perhaps most importantly – demonstrating to others exactly who has the power and who does not.

(Side note: the utterly degrading ritual humilation of making someone pay for the cost of killing something they love is a classic maneuver, and there really should be a term for it.)

In defense of the commisars, though, you can almost hear them say "Don't take it personally, buddy. It's not about you – it's about letting everyone in your tribe understand who's calling the shots."

The incentives that they're laying down are clear: "If you roll over and obey your betters, we'll just destroy your company. …but if you dare to question us, we'll destroy your entire life.

"Yes, in a few years, we commissioners will retire on our our government pensions, and take advantage of the taxpayer funded program for Tier 3 Senior Government Executives that moves all of our furniture, cars, and possessions from our homes in DC to our new retirement houses in Vale.

"But you won't retire. You – as an individual – will be burdened with over $50 million of debt. Even after you sell your house, liquidate your investments, and auction off the coin collection you inherited from your grandfather, will never be out of debt."

P.S. While researching this post, I came across references to an academic paper: "When David Meets Goliath: Dealing With Power Differentials in Negotiation", published in the Spring 2000 issue of the Harvard Negotiation Law Review. I thought it might be interesting to download a copy and see what warnings it had about overbearing government.

It turns out I made a fundamental mistake. It's not a call-to-arms. It's a how-to manual. …written by one of the commissars of the Consumer Product Safety Commission.

When David Meets Goliath: Dealing With Power Differentials in Negotiation

The critical test of one’s effectiveness in a negotiation is what one has convinced an opponent that one can do

To have effective power, one must be willing to use it or be able to convince an opponent that one will use it

If the would-be robber-slight and unarmed-demands the wallet from a large, stout-hearted, and strong victim, the transaction may be marred for the robber by the victim’s refusal to hand over the wallet. If, however, the robber flashes a loaded pistol accompanied by sufficient threats to convince the victim of his willingness to use the weapon, he or she is much less likely to encounter resistance.

That's power. Can you smell it, serf?


Last 5 posts by Clark

Comments

  1. Tarrou says

    Just remember people, good intentions and establishing vast, unaccountable government agencies coupled with an ever-increasing stream of cash is the only thing that can solve the various ills that plague society. There is nothing better for a people, a country, a world than that unelected, un-fireable bureaucrats be given absolute power over tiny slices of our lives. All that remains to be done after that is to ensure that there are enough of these that their individual tiny slices cover every word, thought and deed ever envisioned or enacted by every human on the planet. And remember our creed: "Of course I support ("X" human right), but…."

  2. Illy says

    wow.

    I can't be the only one suprised to be agreeing with Clark. But you're spot-on the money with this one.

    Fun question: If you are part of a burocracy that has been built so that no-one is responsible for anything that it does, who do you blame for it's actions?

    The people/cops/soldiers "just doing thier jobs/following orders"?
    Management making the desicions based on recommendations from reports?
    The people who wrote the reports and made recomendations based on studies?
    The people who performed the studies that led to those reports and recomendations?
    The people who commissioned the studies in the first place?

    Every single one of them can blame someone else for the desicion.

    I guess the only thing to do is to say:
    "If I ever find myself in a position where what I am doing could be used as justification for something wrong, then I will refuse to do it."
    Because if I don't stand against it, then who will?

    (This is where I normally remind Americans that the founding fathers were traitors, terrorists, criminals and revolutionaries to a man. By definition)

    A nice example happened recently in the UK parliment:
    PM polls parliment about whether the UK should make a "strong humanitarian responce" to the Syria situation.
    PM has already got someone on the hook who will state that missile strikes are a humanitarian action.

    If Cameron hadn't been so obvious about what he actually wanted to do, parliment would probably have ok'd "humanitarian assistance", which would then have been translated into missile strikes.

    Of course, to be able to do this, you have to be able to spot loaded questions.

  3. Shane says

    I thought debtors prisons were illegal. Seems that this is an area that is eroded with glee by the government and their rent seeking buddies.

  4. Dan Weber says

    You aren't put in prison for being a debtor. You are just prevented from ever owning significant property. No cake walk at all, but it's not prison.

  5. Xenocles says

    The Constitution may not permit the regulation of magnets, but it pretty clearly permits the regulation of the selling of magnets in many circumstances. The delegation of that authority might be permitted by a good-faith reading of the necessary and proper clause. We may not like the results but living in a fantasy doesn't serve anyone.

  6. freedomfan says

    The CPSC has a history of solving problems that are of piddling statistical significance and/or which have already solved themselves. Regulatory agencies of this ilk are exemplars of why claimed good intentions should be irrelevant in determining policy decisions.

    BTW, it may be worth noting that the CPSC overreach goes beyond driving Maxfield & Oberton into the ground. It has out a proposal to ban all sales of sets of small, strong magnets. There is frequent talk on this site of laws and government rules that are supposed to be narrowly tailored to achieve a certain purpose. Perhaps the CPSC is instead adopting the "… and the horse you rode in on" approach.

    (In the above CPSC link, there are interesting weasel phrases like "[…]we have determined that an estimated 1,700 ingestions of magnets from magnet sets were treated in emergency departments[…]" Note that "determined" makes it sound like a solid conclusion has been reached, but it is really only saying is that there is an "estimate" of 1700 incidents over a 3 year period. If one reads further down to the Incident Data section, some sort of hocus pocus occurs where 72 incidents becomes 1700 incidents. Of course, that might just be a poorly written paragraph or a typo somewhere…)

  7. Dan Weber says

    The CPSC is "think of the children." Adults aren't allowed to sell and own buckyballs because they are dangerous to children.

  8. En Passant says

    "How do I know I'm better than you? Because when I sign a piece of paper your life is destroyed, but you can't do the same to me."

    It ain't just Buckyballs. Don't forget childrens' books, handcrafted childrens' clothing and toys too. And it ain't just businesses.

    From the link to CSPC Obergruppenführer Inez Moore Tenenbaum's bio provided above:

    Chairman Tenenbaum fulfilled a key promise to the Congress and consumers by working closely with agency staff to complete all of the major safety rules required by the Consumer Product Safety Improvement Act of 2008 (CPSIA), a law that reformed and empowered CPSC. In implementing the CPSIA, Chairman Tenenbaum advocated for and the Commission supported:

    the establishment of the strongest crib safety standards in the world;

    the lowest lead limits for children’s products in the world;

    limits on the use of certain phthalates in toys and child care articles;

    mandatory standards for toys, toxic metals, and juvenile products; and

    continuous testing of children’s products by independent, third-party laboratories.

    Sounds ever so reasonable and scientific, and well intentioned, doesn't it? Somebody's got to think of the children.

    Until you discover what it really means. Translated into ordinary terminology here: Seller, beware: Feds cracking down on garage sales.

  9. Max says

    Debtors prison is long gone, and no one need fear being sent to prison for their debts. Well unless they owe that debt to some branch of government, or some company in an industry with enough government regulatio that they are a de facto branch of goverment, those are able to get court judgements. When you don't pay money you don't have in the face of a judgement, you get thrown in prison – not for the debt, but for violating the court order to do the impossible.

  10. AlphaCentauri says

    AFAIK, there would be no problem with selling the magnets if they are labeled with a warning that they are not for children under 3. However, apparently older children were using them to make pretend tongue piercings and swallowing them accidentally. Since most people had magnets as children, most have no idea how dangerous it is to swallow multiple magnets.
    http://www.quantumday.com/2012/06/low-public-awareness-on-danger-of.html
    Calling it an "executive toy" doesn't keep parents from buying them out of the Brookstone catalog when it shows up before Christmas with all the other toy catalogs.

    I don't know the exact facts of this case, and it could be he the subject of retaliation. But it could also be that his company was instructed to conduct a recall based on inaccurate labeling based on multiple prior settled cases and that he decided to dissolve his corporation first so he could distribute the money and not pay for the recall. I'd have to know the other side.

  11. Scott Moore says

    Gettijng so sick and tired of the National Security and 'Someone think of the Children' lines of defense coming from the government all of the time.

  12. James Pollock says

    "Note that the CPSC isn't demanding that the former owner of the corporation pay a fine for damages done ( an illegal and unconstitutional piercing of the corporate veil.)"

    Out of curiosity, Clark, are you claiming that piercing the corporate veil is generally unconstitutional, or just this instance of piercing the corporate veil to be unconstitutional? (Either way, the case you link to doesn't support that conclusion.)

  13. David says

    "Calling it an "executive toy" doesn't keep parents from buying them out of the Brookstone catalog when it shows up before Christmas with all the other toy catalogs."

    So? According to the Wisconsin Poison Control Center, cosmetics are the #2 substance involved in poisoning of those aged 6-19. Does that mean we should ban cosmetics? I mean, cosmetics are by definition unnecessary, and they are apparently a greater risk than toys, which even lumped together with "foreign bodies" and "miscellaneous" only ranks as #4.

  14. Jason says

    @AlphaCentuari,

    Well, the container my buckyballs came in has this printed on it:

    WARNING Keep Away From All Children! Do not put in nose or mouth….

    And then it continues to explain the dangers of swallowed magnets.

    In their campaign to not have their product outlawed, the company pointed out how latex balloons result in far more mishaps, emergency room visits, and deaths than buckyballs do.

    I know that really doesn't fulfill the part where you ask for facts as to why the CSPC would do this, but it sure as hell adds credence to the suggestion that the only reason they're going after the CEO so aggressively is pure unadulterated revenge and abuse of power.

  15. Speed says

    Speaking of bullying …

    David Miranda, who lives with Glenn Greenwald, was returning from a trip to Berlin when he was stopped by officers at 8.05am and informed that he was to be questioned under schedule 7 of the Terrorism Act 2000

    The 28-year-old was held for nine hours, the maximum the law allows before officers must release or formally arrest the individual. According to official figures, most examinations under schedule 7 – over 97% – last less than an hour, and only one in 2,000 people detained are kept for more than six hours.

    Miranda was released, but officials confiscated electronics equipment including his mobile phone, laptop, camera, memory sticks, DVDs and games consoles.

    http://www.theguardian.com/world/2013/aug/18/glenn-greenwald-guardian-partner-detained-heathrow

  16. Mercury says

    Even worse the feds appear to be superseding the longstanding precedent of limited corporate liability and going after Zucker personally. It turns out that “hope and change” actually means social capitulation to the government in all areas of life.

    The CPSC has already made the “transmission” of books older than Brittany Spears illegal (without onerous and expensive certification that they are toxin-free) – this from a president (Bush II) whose wife was longtime children’s librarian.

  17. Renee Marie Jones says

    As a socialist, I am outraged that the government would waste its resources harrasing a seller of round magnets while people starve and freeze in the streets. Only a callous conservative – libertarian government would behave this way.

  18. Speed says

    Wouldn't it be great if the federal government had a finite amount of money to spend so that the dollars spent on witch hunts like this would punish not only the hunted but some other government program like maybe the CDC's Vaccines for Children Program.

  19. Matthew Cline says

    So? According to the Wisconsin Poison Control Center, cosmetics are the #2 substance involved in poisoning of those aged 6-19. Does that mean we should ban cosmetics?

    In their campaign to not have their product outlawed, the company pointed out how latex balloons result in far more mishaps, emergency room visits, and deaths than buckyballs do.

    I wouldn't be at all surprised if the folks at the Consumer Product Safety Commission wished they could ban cosmetics and latex balloons, and the only reason they don't is that they lack the political clout to do so.

  20. Steven H. says

    @Mcalex:

    "lol, but just try to stop the sale of assault rifles …"

    Noone's been trying to stop the sale of assault rifles – they're trying to stop the sale of semi-automatic rifles that LOOK LIKE assault rifles.

  21. Marconi Darwin says

    They did have warnings – multiple ones, and not for ages 3 and under, but for ages under 14.

    From Bloomberg BusinessWeek …

    Is Bloomberg BusinessWeek related to a Mayor Bloomberg who banned sodas in sizes larger than those that would fill a child's bladder?

  22. Shane says

    @Renee Marie Jones

    Only a callous conservative – libertarian government would behave this way.

    Don't you have a utopia that you are supposed to be building, so the adults can get on with their lives?

  23. azazel1024 says

    Its okay, congress allows/charters/requires CPSC to come down like a Goodwin winning internet conversation on anyone and everyone about "consumer" things, but congress won't allow or pass laws effectively regulating Monsanto and their ilk about what they put in food that our children eat.

    So, lets regulate what kids MIGHT put in their bodies, but lets NOT regulate what kids MUST put in their bodies.

    This isn't entirely an executive branch issue, this is promulgated by the legislature in large part.

  24. Dion starfire says

    I've got a great response to "think of the children" foolishness:
    "I am. Better to learn (xyz) now, when they've got all sorts of support for recovering from their mistakes, then let them grow up to become (universally acknowledged idiot (e.g. George W. Bush, the guests on Jerry Springer, etc.))."

  25. That Anonymous Coward says

    How about the next time someone wants to pass a 'think of the children' law we just point out that is the parents job. That interfering with how they chose to raise their children is a massive over-step on the part of the Government.

    Now if only we could get parents to actually take back the job.
    (Not all parents of those little mouth breathing toxin factories are bad, but we all have stories about someones precious little snowflake making everyone miserable because the parent refused to be in charge of their kid.)

  26. Castaigne says

    @Clark: Destroying a retailer network is like tearing down a city's walls and salting its fields. After that the resource is of no use to the original owner, it's of no use to anyone else, and it can't be fixed. It's gone.

    Strange. As I recall from when the Buckyball case first started up, Buckyball refused the recall that was put out and continued selling. Then later had to file a Certificate of Cancellation with the state, dissolving the company…due to the lawsuits from the 33 surgeries and 1 death that occurred from misuse of their products. They destroyed their own retailer network, first chopping out children's stores and selling only to office stores, and then by collapsing under the legal costs from the civil suits.

    Looks like they might should have adhered to the recall by the CPSC. Zen Magnets surely did.

    You might think that my argument is that there is a power imbalance, and hence bullying, when some government bureaucrat with a taxpayer-provided medical plan, a retirement plan guaranteed near-$200k/year salary, bonuses of up to 20% per year, 25 days of vacation per year (in addition to all government holidays), 11 months of sabbatical per decade (with travel, per diem, and salary covered), personal professional liability insurance, and so on destroys the business of a 34 year old entrepreneur and pushes him near bankruptcy. But, no, that's not what I'm arguing.

    No, you're just engaging in 'poisoning the well'. We understand that completely.

    Because the owner had the temerity to back-talk his betters – and worse yet, do it in public – the CPSC is demanding that the former owner of the corporation pay the administrative cost of destroying his company.

    It was actually because he engaged in shady legal tactics to avoid paying the civil lawsuits, but it's perfectly within the rules for the agency in question to do this. If it's legal, it's legit.

    The incentives that they're laying down are clear: "If you roll over and obey your betters, we'll just destroy your company. …but if you dare to question us, we'll destroy your entire life.

    Again, you're really wrong here. It's more of a message of "OK, Skeevemeister General, if you want to be a cheater slicks like that, we can level the playing field like that."

    I understand that it's par for the course for anarcho-capitalists to ignore the whole story and present very one-sided viewpoints that favor their theorems. I really do expect you to shill for CEOs. But I find it remarkably dishonest of you to ignore that Zucker is a shady character who deliberately sought to avoid liability for his product. You're free to be one-sided, I guess, but as a fellow Catholic, I would suggest you avoid it for the sake of your soul.

    Now, if the “responsible corporate officer” doctrine does NOT apply to Zucker, that will be determined the legal proceedings. I note that the Washington Legal Foundation has a good argument why it doesn't apply (http://www.wlf.org/publishing/publication_detail.asp?id=2391).

    But let's present all sides of the story, by all means.

  27. David says

    I'm always up for outrage against petty bureaucrats, but the WSJ article was pretty one-sided. Zucker's actions were not unimpeachable.

  28. says

    I've lived in SC long enough I have to claim it as a home, but sure enough, if SC is in the news, it'll be embarrassing. I lived here back when she was running pretty frequent political ads and she used to really play up the loving mom/school teacher angle for all it was worth. I always thought she was a pathetic hack, constantly boasting about improving the terrible schools here in SC (when you're as low as we are, it's almost impossible not to improve). Another embarrassment for my adopted home state.

  29. En Passant says

    David wrote Sep 3, 2013 @9:19 pm:

    I'm always up for outrage against petty bureaucrats, but the WSJ article was pretty one-sided.

    The bureaucrats are not petty in terms of the power they wield. They are petty in terms of their rationalizations for their actions, and in terms of their motivations for their actions.

    A one-sided article would require an event that hasn't happened. A one-sided article might be "Last night an American hero massacred the CPSC and their entire families as they slept. Some bleeding hearts argue that their children should have been spared."

  30. Caleb says

    @Castaigne

    Y'know, reading comprehension is a good skill to acquire.

    As I recall from when the Buckyball case first started up, Buckyball refused the recall that was put out and continued selling.

    You recall wrong. CPSC first contacted Buckyball about insufficient warnings on their products. Buckyball complied with CPSC's recall and new warning requirements, and even got CPSC's approval to keep selling. It was only later that CSPC decided the product was inherently dangerous. But CPSC sent the letter to Buckyball's retailers before filing the administrative complaint. There was no recall for Buckyball to comply with at that time!

    The voluntary recall request only came afterward.

    They destroyed their own retailer network, first chopping out children's stores and selling only to office stores…

    Which they did at the behest of CPSC.

    …and then by collapsing under the legal costs from the civil suits.

    None of the civil suits were decided then. But Buckyball had no retailers by then. Hard to pay for civil suits when you aren't selling a product. Wonder why Buckyball's retailers dropped them? It couldn't have anything at all to do with CPSC's scary letter, could it?

    It was actually because he engaged in shady legal tactics to avoid paying the civil lawsuits,

    What 'shady legal tactics?' Defending himself? Dissolving his corporation? The corporation had no revenue. Why would he keep his corporation around if it couldn't sell anything? He established a liquidated trust (as was legally required) to pay out any outstanding claims. What shady thing did he do?

    …but it's perfectly within the rules for the agency in question to do this. If it's legal, it's legit.

    The CPSC has never before held a corporate officer personally liable for statutory violations where the officer did not comply with a voluntary recall request. There is no established precedent for the CSPC's actions. They say they have the authority. Do administrative agencies have a right all the authority they claim?

    But I find it remarkably dishonest of you to ignore that Zucker is a shady character who deliberately sought to avoid liability for his product.

    Again: what shady thing did he do? What action did he take, other than wage an effective PR campaign that made the CSPC look like a bunch of petty, jack-booted thugs? Do you have any basis for your claims, other than your own ideology?

  31. R R Clark says

    Castaigne has the right of it. The CPSC sought dispensation to pierce the corporate veil and seek restitution directly from Zucker for reasons directly related to his actions following the CPSC notification that the product was considered potentially harmful to children.

    There are plenty of companies that survive CPSC notifications, even if they are start-ups. They tend to quickly comply with a recommended recall, though. There are large companies that don't (carmakers, for instance), that end up paying large fines and legal fees as a result of their reticence. We routinely castigate them when we discover that they felt a few deaths didn't warrant a recall of several hundred thousand vehicles. Zucker lost a lot of civil judgments for damages and then sought not to pay them. I realize that weaseling out of your commitments is the new American Way, but that doesn't mean the government has to stand idle while we do it.

    You're also a bit misinformed about the Senior Executive Service. They can be terminated for unsatisfactory performance with no continuing benefits beyond that of the average redundant worker, e.g. COBRA and severance. They can be terminated immediately, too, unlike General Schedule employees.

  32. grouch says

    How many of those magnets would it take to cover Washington, D.C.? Would a gift of $57 million worth of those executive toys be sufficient to keep the head of the CPSC too busy to meddle?

    Someone surely has figures for mass and volume and retail price.

  33. J.R. says

    Why don't they persecute the makers of knives, nails, hammers, screws, screwdrivers, all forms of glass, and ceramics (including cups, bowls, plates)? All potentially dangerous to adults to say nothing of children Then there's grapes, paper towels, paper napkins, toilet paper: "Ingestion of "x" may lead to gastric distress or suffocation …"? Petty asswipes.

  34. AlphaCentauri says

    Magnets are a problem because people with ordinary common sense grossly underestimate the danger of a child swallowing them. The magnets we played with as children were very weak. Even the "Monster Magnet" was just a big piece of horseshoe shaped plastic with a weak magnet at each end. The magnets sold today are much more powerful.

    Swallow one Buckyball and it goes right through. Swallow two or more and the cling to each other and stay put, trapping loops of bowel between them with so much pressure the tissue dies, spilling stomach acid, digestive juices, or feces out into the abdomen.

    I'm glad to hear they were labeled appropriately, but there's an inherent problem with toys like this — the box with the warnings gets discarded, the balls fall on the floor and roll out of sight, the owner gets older or gets tired of the toy and a family member sells it at a garage sale, and eventually some kid crawling on the floor is finding Buckyballs under the couch.

    Is that a forseeable danger? Should the manufacturer have anticipated it? Should they be held liable for medical costs of victims surgery? Should the parents of a victim be homeless because they spent their money on their kid's surgery and not on their mortgage? You can argue about the tort system or the CPSC or the nanny state, but you also have to consider whether there's a good enough reason to sell this product with dangerous balls that can roll away and be forgotten.

    As far as "executive toys," putting a powerful magnet on your desk at work near your computer and cell phone isn't a real smart move. I have to suspect that most recipients were children.

  35. Castaigne says

    @Caleb: You recall wrong. CPSC first contacted Buckyball about insufficient warnings on their products. Buckyball complied with CPSC's recall and new warning requirements, and even got CPSC's approval to keep selling.

    Yes, Buckyballs followed the 2009 recall and put the labels on then. [1] But they refused the 2012 recall and refused to add additional labels then. I quote the letter from the CPSC itself, issued 2012-07-25 [2]:

    "In November 2011, CPSC and Maxfield & Oberton worked cooperatively to inform and educate consumers that Buckyballs were intended for adult use only, and although the risk scenarios differ by age group, the danger when multiple rare earth magnets are ingested is the same. However, even after the safety alert, ingestions and injuries continued to occur."

    and

    "Due to the number of ingestion incidents received by CPSC staff since the 2010 recall announcement and 2011 safety alert, CPSC staff seeks the remedies outlined in the complaint to stop further incidents and injuries to children."

    and

    "The Commission staff filed the administrative complaint against Maxfield & Oberton after discussions with the company and its representatives failed to result in a voluntary recall plan that CPSC staff considered to be adequate. This type of legal action against a company is rare, as this is only the second administrative complaint filed by CPSC in the past 11 years."

    If Zucker had actually cooperated, which he was not inclined to do (and was reluctant to do in 2009 by his own admission), there would have been no need to issue the administrative complaint. The CPSC did try to work with him. He just wasn't having any of it, which is par for the course for Zucker.

    None of the civil suits were decided then.

    He was well aware he was going to lose hardcore. He was well aware that he had truly fucked himself, liability-wise. His own legal counsel had been telling him so, but Zucker was slow to believe them. He admits this in the Fox interview.

    What 'shady legal tactics?' Defending himself? Dissolving his corporation? The corporation had no revenue. Why would he keep his corporation around if it couldn't sell anything? He established a liquidated trust (as was legally required) to pay out any outstanding claims. What shady thing did he do?

    Here's an abbreviated sequence of events for you. Tell me if it's shady to you:

    – CPSC meets with Zucker & Co in 2012 to work out a voluntary recall. Zucker dicks around with them for a few months and then tells them "Fuck off. I'm not liable for shit."

    – CPSC issues the administrative complaint in July 2012 and goes public, sending letters to the retailers advising them that, hey, we tried to work with this guy and he blew us off. Retailers nod their head sagely and do what they think is best.

    – Civil lawsuits had already begun before this, but after CPSC goes public, the heat gets turned to ELEVEN. [3]

    – Zucker starts his public campaign of "The CPSC are jack-booted thugs and my product is awesome and needs no warnings! No, really! People who suffered injury from my product are dipshits and morons who get everything they deserve." Ignores his legal bros in a fit of ego, adds a whole lot of evidence to the plaintiffs. Whoops.

    – December 2012. Zucker realizes that he has royally ass-fucked himself with his own ego. Retailers are fleeing in droves. His legal team has given up and told him how screwed he is. In order to avoid paying out tons, he dissolves his own company. The trust he sets up has a pittance in it, not even covering medical costs for the plaintiffs. Zucker skates out, laughing his ass off, giving both middle fingers, keeping everything he siphoned from the company before bailing.

    – CPSC says "OH NO YOU DINT!" and drags out the big guns.

    Now, Zucker's actions may not sound shady to you, but they're pretty fucking shady to me. Dishonest tactics, weasel attempts – Zucker did not act in good faith. He could have worked a deal with the CPSC. He could admitted his liability, paid the plaintiffs, add new labels to his products that covered him legally. But instead, he went on an ego trip. He decided to play Rebel With A Cause when he had nothing but his own ego to stand on.

    Yes, I consider THAT to be shady.

    The CPSC has never before held a corporate officer personally liable for statutory violations where the officer did not comply with a voluntary recall request. There is no established precedent for the CSPC's actions.

    Just because they haven't done it before means they can't do it now? That's bullshit and you know it. Just because you haven't had to drop nukes before, doesn't mean you can't drop a nuke in the future when you think the it's warranted. They have the ability and legal authority; they can use it.

    They say they have the authority. Do administrative agencies have a right all the authority they claim?

    1) The question about whether this or that agency have a right to all the authority they claim is a philosophical issue. I don't care about that. All I care about is: do they have the legal authority to do so?

    2) If the CPSC does not have the legal authority to do this, take it to a court and show what statute/regulation they're violating and why.

    Again: what shady thing did he do? What action did he take, other than wage an effective PR campaign that made the CSPC look like a bunch of petty, jack-booted thugs? Do you have any basis for your claims, other than your own ideology?

    Answered above.

    [1] http://www.cpsc.gov/Recalls/2010/Buckyballs-High-Powered-Magnets-Sets-Recalled-by-Maxfield-and-Oberton-Due-to-Violation-of-Federal-Toy-Standard/

    [2] http://www.cpsc.gov/Newsroom/News-Releases/2012/CPSC-Sues-Maxfield–Oberton-Over-Hazardous-Buckyballs-and-Buckycube-Desk-Toys-Action-prompted-by-ongoing-harm-to-children-from-ingested-magnets-/

    [3] Do you know how many timezones there are in the Soviet Union? ELEVEN. That's just unbelievable. (Negativland reference)

  36. Christophe says

    Clark, you really arguing that the corporate veil is a right granted under the US Constitution? Because that strikes me as a highly implausible claim. If you are really siting Holley v. Meyer (as that link appears to), you might want to explain how a case in which SCOTUS specifically allowed the piercing of the corporate veil in the case of hollowing-out a corporation somehow establishes a right to the veil.

  37. Christophe says

    In the interests of accuracy, SCOTUS didn't rule either way on the corporate veil question (their ruling was strictly limited to the Fair Housing Act); on remand, the Ninth Circuit allowed the corporate veil to be pierced.

    In any event, as they say, Holley v. Meyer actually supports the CSPC's actions; I do not understand why it is being cited as some kind of evidence that there is a constitutional right to a corporate veil. Piercing the corporate veil is not some kind of bizarre one-every-century process. It's quite common when assets are moved around specifically to shield them from liability… like, say, from a project that has caused injury.

  38. Nemo says

    Compared to this, making a slur of trade schools pales in comparison with regards to this bureaucrat's over-reach. Doesn't make slighting tradesmen a good thing, though.

    Unless, of course, you are the sort of person who wants to lord it over plumbers and such – until your AC dies or your sewer line is clogged – at which point you'll bitch about the outrageous fees they charge for things which you can't do for yourself. Things for which they charge /far/ less than lawyers do, for more concrete results.

    G'wan, tell your mechanic that he's a second-class citizen /before/ he pops the hood on your car, just because you have a fancy degree and he went to a trade school. If he does a fine job, it'll be more than you deserve.

    Just dial 1-800-I-dissed-DeVry-and-all-other-trade-schools if your car dies just after the warranty expires.

  39. says

    @Christophe

    Clark, you really arguing that the corporate veil is a right granted under the US Constitution?

    No. Where do you see that?

  40. says

    @Christophe

    In any event, as they say, Holley v. Meyer actually supports the CSPC's actions

    No, it doesn't. In that case, the relevant statute specifically gave the government the right to pierce the corporate veil for certain industries and certain regulations.

    …which do not apply to BuckyBalls.

  41. says

    @Castaigne:

    I disagree with all of your comment and it deserves a long rebuttal, which I do not have time for.

    What I DO have time for, though…

    [3] Do you know how many timezones there are in the Soviet Union? ELEVEN.

    …is to praise your Negativland reference. (a) EPIC. (b) That's exactly what I say every time (well, SOME times) the word "eleven" comes up in conversation.

    Michael Jackson, look what you've done!

  42. James Pollock says

    "No, it doesn't. In that case, the relevant statute specifically gave the government the right to pierce the corporate veil for certain industries and certain regulations.
    …which do not apply to BuckyBalls."

    Citation for this premise?

  43. James Pollock says

    "Clark, you really arguing that the corporate veil is a right granted under the US Constitution?
    No. Where do you see that?"

    That would be in the text of the article, wherein you claim the attempt to pierce the corporate veil is unconstitutional (which it is not).

  44. Christophe says

    No. Where do you see that?

    You wrote:

    Note that the CPSC isn't demanding that the former owner of the corporation pay a fine for damages done ( an illegal and unconstitutional piercing of the corporate veil.)

    What did you mean, if you didn't mean that there is a constitutional right to a corporate veil?

    No, it doesn't. In that case, the relevant statute specifically gave the government the right to pierce the corporate veil for certain industries and certain regulations.

    …which do not apply to BuckyBalls.

    I really have no idea where you are getting that reading of Holley. No court in the entire history of that case issued any kind of ruling that said, "The only reason you are allowed to pierce the corporate veil is if there is a specific statute allowing it." The Ninth Circuit, on remand, allowed the veil to be pierced for the standard reasons that courts always do: Insufficient independence of the corporation, hollowing-out, and so forth.

    You claim you are not arguing that the regulatory state is unconstitutional here, but there's really no other way to characterize your argument. The CPSC is doing nothing that exceeds its statutory powers here; if you don't like those, OK, fine, but I think that legal ship has long since sailed.

    They can ask the court to pierce the corporate veil just like any creditor can ask the court to do so; if you then want to argue that the courts don't have that right, you really need to come up with something good to justify that position, because that's a pretty novel interpretation of corporate law.

  45. Caleb says

    @Castaigne

    Yes, Buckyballs followed the 2009 recall and put the labels on then. But they refused the 2012 recall and refused to add additional labels then

    1. M&O submitted their corrective action plan with the CPSC before their filing deadline on 24 July 2012. CPSC went ahead with the complaint anyway.

    2. The complaint specifies that this was not merely about improper warnings. This was about the design of the product itself. CPSC wanted M&O to stop selling, period. That would effectively have ended M&O's business anyway. Maybe that had something to do with their reluctance to knowtow to the CPSC?

    Please read this closely:http://www.cpsc.gov/PageFiles/131696/maxfield1a.pdf

    Pay particular attention to count 2.

    "The Commission staff filed the administrative complaint against Maxfield & Oberton after discussions with the company and its representatives failed to result in a voluntary recall plan that CPSC staff considered to be adequate.

    (emphasis mine)

    M&O were fine with a redo of the 2009 recall. (Out of hundreds of thousands of products sold, something like 50 were returned.) CPSC was not. M&O filed their corrective action plan, the CPSC rejected it, then filed the complaint the next day.

    If Zucker had actually cooperated, which he was not inclined to do (and was reluctant to do in 2009 by his own admission), there would have been no need to issue the administrative complaint. The CPSC did try to work with him.

    But rejected the corrective action plan. You have an odd idea of "trying to work" with someone.

    He was well aware he was going to lose hardcore. He was well aware that he had truly fucked himself, liability-wise.

    That alone is not a ship-sinker. There are lines of credit and other financing options available for companies who have a popular product with unforeseen liability costs. What is fatal is starring down those liability suits when your corporation suddenly has no revenue. Like if, say, an overbearing government agency wants you to stop selling and is intimidating your retailers into dropping their contracts. Now you have a problem.

    The trust he sets up has a pittance in it, not even covering medical costs for the plaintiffs.

    Three things:

    1. Do you have any evidence that the trust is underfunded vis-a-vis liability suits?

    2. Read the second amended complaint. Tell me where… anywhere in there the CPSC claims that dodging civil suit liability is the reason they are joining Zucker to the action.

    3. Even if Zucker is a liability-dodging scumbag (a proposition I have yet to see any evidence for) punishing him is not the CSPC's job! It is WELL outside CPSC's authority to police the corporate form when it comes to capitalization of liability claims. Do you know whose job that is? The court where the claim is being adjudicated, and the state of incorporation's corporation commission.

    If the CSPC is going after Zucker because he improperly divested corporate funds away from civil liability payments, then it IS overstepping its authority, and IS acting like a vindictive bully. Clark is still right, just not for the reasons he cited.

    Just because they haven't done it before means they can't do it now? That's bullshit and you know it.

    No, you see, there's this thing called "precedent." http://en.wikipedia.org/wiki/Precedent

    My argument is that if CPSC had the authority to apply the responsible corporate officer doctrine to a corporate officer who did not break the law, then one of two things would be true: 1) they would have clear, plain language statutory authority for doing so, or 2) they would have case law that said they have that authority. CPSC clearly does not have 1), not even they are claiming so. They claim to have 2). That argument is facetious, as the link you first provided so clearly argued. Lacking 1) or 2), the agency does not have legal authority for what it is doing.

    Principles of administrative law clearly establish that an agency may not act outside of the scope of authority granted to them by Congress. That doesn't mean they don't do so all the time. There aren't many ready checks that police the boundaries of their authority. That's part of Clark's point. But unless you are a hard-core legal realist, you have to acknowledge the difference between [stuff the agencies have legal authority to do] and [stuff they get away with doing].

    1) The question about whether this or that agency have a right to all the authority they claim is a philosophical issue. I don't care about that. All I care about is: do they have the legal authority to do so?

    The former directly impacts the latter question. If your answer to the former is "yes," then an agency has the authority to do whatever the hell it wants until some outside force smacks it back into place. If your answer to the former is "no," then the agency steps outside of its proper authority whenever its action exceed the scope of the law its acts under, even if it faces no repercussions for doing so.

    2) If the CPSC does not have the legal authority to do this, take it to a court and show what statute/regulation they're violating and why.

    I hope he does so.

    But you have the argument backwards. An agency can only act pursuant to a law. They are not only bounded by what the law says they can't do. For every action they take, the burden is on them to point to a law that says the CAN do so. This is a pretty foundational concept in government law.

  46. En Passant says

    AlphaCentauri wrote Sep 4, 2013 @5:57 pm:

    Magnets are a problem because people with ordinary common sense grossly underestimate the danger of a child swallowing them. The magnets we played with as children were very weak. Even the "Monster Magnet" was just a big piece of horseshoe shaped plastic with a weak magnet at each end. The magnets sold today are much more powerful.

    I call bullshit. This argument is a rebadged "this ain't yer father's marijuana, so we must think of the children" drug czar's argument. It's just gussied up to serve some other bureaucrat's transparent purpose of inflicting the power of their petty regulatory fiefdoms upon adult citizens by declaring that they need as strict supervision as small children.

    The Alnico and hard ferrite magnets I played with in the 1950s had as much as half the field strength of rare earth magnets today. That's plenty strong to clamp together the thin flesh of intestines if swallowed.

    Even worse, and what would horrify our CPSC overlords today, I obtained my magnets by disassembling old radio set speakers. These days the government nannies would have charged every adult in my life with child endangerment for allowing that. Yet I, and luckily even some of my next generation pre-CPSC nephews, got our first inklings of understanding technology and science by engaging in such "dangerous" activities.

    The difference between now and then is that in those days kids played with magnets, and didn't eat them. At least not enough kids ate magnets to become a blip on the statistical radar of unelected bureaucrats looking to expand their fiefdoms.

    The "magnet problem" hysteria is a manufactured crisis, like its predecessor "book problem" hysteria of kids suffering lead poisoning from pre-1995 children's books. Ambitious bureaucrats create fake crises by deceptively stating and manipulating the statistics of a miniscule number of extreme outlier cases.

    The real problem is overweening and ambitious unelected bureaucrats who seize on statistical outliers as an excuse to feed their insatiable lust for power and control over every possible aspect of every citizen's life.

    These bureaucrats want nothing less than total power and control. That requires an ignorant and compliant populace, who see technology, math and science as black magic. A population skilled and knowledgeable in technology is a the greatest threat to their ambitions.

    If they can in any way inhibit or prevent a generation of children from learning anything except abject servitude, they will. Even if it means outlawing adult possession of magnetic toys. We welcome our nanny overlords only at great risk to the liberty of future generations.

    Someone else around here said "Burn it. Burn it to the ground." In the case of the CPSC I cannot not agree more enthusiastically.

    End of rant. Yada yada yada! Come and get me warden Tenenbaum!

  47. Caleb says

    @ En Passant

    The real problem is overweening and ambitious unelected bureaucrats who seize on statistical outliers as an excuse to feed their insatiable lust for power and control over every possible aspect of every citizen's life.

    I like this. I like this a lot. I'm stealing it.

  48. En Passant says

    Me corriger, demonstrating the dangers of enthusiastic typing without thorough proofreading:

    Someone else around here said "Burn it. Burn it to the ground." In the case of the CPSC I cannot not agree more enthusiastically.

  49. En Passant says

    Caleb wrote Sep 5, 2013 @9:01 am:

    I'm stealing it.

    Such are the risks of unregulated speech. No doubt the ilk of Inez Moore Tenenbaum will soon be publishing a new regulation in the Federal Register to punish any future occurrences of such heinously dangerous behavior.

  50. HandOfGod137 says

    @En Passant

    The Alnico and hard ferrite magnets I played with in the 1950s had as much as half the field strength of rare earth magnets today. That's plenty strong to clamp together the thin flesh of intestines if swallowed.

    Would you have swallowed two of the much larger Alnico/ferrite magnets? Do you have a full understanding of the strength of neodymium and samarium-cobalt magnets relative to the strength of magnets pulled from 1950's speakers?

  51. En Passant says

    HandOfGod137 wrote Sep 5, 2013 @9:28 am:

    Would you have swallowed two of the much larger Alnico/ferrite magnets?

    Asked and answered in my original comment, but anyhow. Of course I would not swallow them. I didn't swallow them. And some were small enough to swallow.

    Do you have a full understanding of the strength of neodymium and samarium-cobalt magnets relative to the strength of magnets pulled from 1950's speakers?

    What is "full understanding"?

    Typical B-fields range from about ~.2 to something less than ~1 Tesla for old speaker magnets, versus about ~.7 to ~1.5 Tesla for rare earth magnets.

    Ratio of typical field strengths is a factor of about 2 to about 5, roughly, depending on the magnet's quality.

    Even old speaker magnets of relatively small physical dimension or size can be dangerous if swallowed.

    What further "full understanding" is necessary?

  52. HandOfGod137 says

    @En Passant

    Well, basically you're making an argument from incredulity. There have been a number of documented cases of intestinal obstruction from rare-earth magnets of the type used in Buckyballs (q.v. http://www.naspghan.org/user-assets/Documents/pdf/Advocacy/Magnets/Management_of_Ingested_Magnets_in_Children%2031.pdf), whereas I can find no equivalent cases for Alnico or ferrite magnets.

    You may call "bullshit", but the facts would seem to be against you.

  53. babaganusz says

    (b) That's exactly what I say every time (well, SOME times) the word "eleven" comes up in conversation.

    ditto. (almost always including "it's not even funny.")
    and this has recently expanded my mix of such responses: sketch from s1e1 of Burnistoun

  54. En Passant says

    HandOfGod137 • Sep 5, 2013 @11:12 am:

    Well, basically you're making an argument from incredulity.

    No. Not at all. Not by any stretch of the imagination.

    I argued two points:

    First, that ordinary Alnico and hard ferrite magnets have sufficient field strength to be dangerous if more than one is swallowed, or if any iron objects are swallowed with one magnet.

    Second, that CPSC chose to ban adult toys based upon outlier events caused by children playing with adult toys that they should not have been playing with. Whether that's because of poor adult supervision, or childish defiance of warnings from the adults supervising them, the blame does not lie with the maker of the clearly marked adult toy.

  55. HandOfGod137 says

    @Caleb

    Good find. Though one child, possibly suffering from Pica, obstructing his stomach with the quantity of magnets swallowed doesn't really seem equivalent to the 34 cases (including one death) of rare-earth magnet ingestion reported in 2007 in the USA. 24 cases here in England at one hospital in 2002. Well done for finding one case from 2006, but there does seem a slight imbalance in scale, doesn't there?

  56. HandOfGod137 says

    @En Passant

    I'm not arguing with any point you made about the CPSC: I don't know enough about your legal system to make an informed comment. My point is the the magnets from Buckyballs are small enough and powerful enough to make them qualitatively different as a danger for children. These are the sorts of things very small children could just put in their mouths, or older kids could do the pretend piercing thing, neither of which would be a significant risk with speaker magnets. And the documented numbers of cases and injuries would seem to support that.

  57. En Passant says

    HandOfGod137 wrote Sep 5, 2013 @12:18 pm:

    My point is the the magnets from Buckyballs are small enough and powerful enough to make them qualitatively different as a danger for children. These are the sorts of things very small children could just put in their mouths, or older kids could do the pretend piercing thing, neither of which would be a significant risk with speaker magnets. And the documented numbers of cases and injuries would seem to support that.

    Your reasoning is nigh classical post hoc ergo propter hoc error.

    Take my numbers or look up your own sources, but I contend that Alnico and ferrite magnets can have sufficiently strong B-fields to cause like injuries to rare earth magnets if ingested.

    You are concluding that because there were fewer or no reported cases of injury due to Alnico and ferrite magnets than due to rare earth magnets, then only rare earth magnets can cause injury.

    But there is an actual cause that is definitely not related to the relatively small differences (less than an order of magnitude) in the typical field strengths of the two types.

    That cause is that nobody ever marketed collections of spherical Alnico or ferrite magnets as successfully as the Buckyballs toys were marketed. Hence the events of children ingesting small spherical Alnico or ferrite magnets were much less likely to happen — because there weren't any (or many) such magnet collections popularly available.

    That leaves aside any consideration of whether CPSC should ban either type of magnets marketed to adults.

  58. amber says

    @shane: Debtor prison might be illegal, but less than ethical collection agencies do manage to con police departments and sheriff departments to arrest debtors, and pursue criminal charges against the debtors.

    This usually, but not always occurs, when the collection agency files a lawsuit against the debtor, and the debtor fails to show at the hearing. That failure to show results in an automatic judgement against the debtor. Maybe one judge in thousand will actually look at the evidence, before granting a judgement. It is utterly unheard of a judge to not grant a default judgement against the debtor. (I've seen more than one instance where the only evidence that there ever was a debt, was the verbal claim of the collection agency. If the debtor had even shown up, the debtor would be able to collect enough evidence from the court case, to successfully sue both the collection agency, and their lawyers, for numerous FDCPA violations.)

    The collection agency sends a notice to the local police department or sheriff advising that the debtor failed to appear in court, and thus violated the legal statutes, blah, blah, blah. A careful search of those statutes will show that they are only enforced for felonies, or when the collection agency sends the notice.

    If the debtor has the money, and legal where-with-all to retain independent counsel, the charge will usually be dropped, before going to trial. If it goes to trial, a "not-guilty" verdict is far more common than not. If the debtor uses a public defender, the case is usually plea-bargained to a lesser charge, and a "criminal" record. Public defenders, for some reason, don't think of "selective prosecution" as a meaningful legal defence, for this "crime" of missing a court date for a civil action, which automatically results in a negative consequence for the individual who missed the court date.

    I don't have the legal cite, but one judge flat out asked the sheriff why it wasted time arresting the debtor. The sheriff agreed that it was a waste of department time, and money, but they were legally obliged to do so.

  59. James Pollock says

    "These are the sorts of things very small children could just put in their mouths, or older kids could do the pretend piercing thing, neither of which would be a significant risk with speaker magnets."

    Another fundamental difference is that speaker magnets are sold with, you know, speakers wrapped around them. I haven't disassembled many speakers, but is that something a three-year-old can do? I believe 3yo is the cutoff for warnings about products that can be disassembled to produce choking hazards…

  60. James Pollock says

    "I contend that Alnico and ferrite magnets can have sufficiently strong B-fields to cause like injuries to rare earth magnets if ingested."

    OK, then if someone is marketing products that consist of Alnico and/or ferrite magnets in a product that has a substantial risk of ingestion, they should have warning labels, too… and perhaps a redesign to reduce the risk.

  61. Caleb says

    @ HandOfGod137

    Well done for finding one case from 2006, but there does seem a slight imbalance in scale, doesn't there?

    As a good Bayesian, I would have to say: "that depends on your priors." What is the probability of a harmful swallowing incident given the presence of neodymium magnets versus the probability of harmful swallowing without? What is the probability of harmful swallowing overall? What is the rate of exposure to non-neodymium magnets versus exposure to neodymium magnets?

    You can't just point to the raw numbers of one type of incident versus another and draw a meaningful conclusion. It would be like comparing the number of deaths caused by falling in airline travel against the number of deaths due to falling in auto travel and concluding air travel is more dangerous.

  62. James Pollock says

    Just for fun, because I have some time this afternoon, let me try to spell out the libertarian argument.

    We have a situation where there is a product which is or at least can be amusing to some people, but causes injuries in a small but significant subset of the population. Therefore, the libertarian, says, those injured should bring suit for their injuries, prove their cases in court, and collect their judgments. The manufacturer can then raise prices as needed to cover the cost of the judgments (or insurance) and the marketplace will decide if the benefits of having this product available outweigh the dangers of having this product available, by either buying the product at the increased price, or by forgoing purchase at the higher price. This model, which basically amounts to including the cost of product liability as a cost of manufacturing, has been used successfully for a wide range of products, from chainsaws to automobiles. It assumes that people are capable of determining for themselves what risks they will accept, and under what circumstances.

    Now, the counter-argument:
    While a free-market model works and works well in most circumstances, there are edge cases where it does not. For example, folding the cost of products liability into manufacturing costs only works after there has been time to reach homeostasis, and it assumes that there is an ongoing interest in manufacturing the product. A shady, fly-by-night operator might produce a faulty product, fail to include any costs of product liability into the pricing, undercut the competitors who DO include those costs in their pricing, sell a good many products… then fold up shop and disappear, leaving no trace when the product liability claims start to surface. (Of course, if product liability is unknown, it's possible that an honest manufacturer will underbudget by a substantial factor… a common mistake for new products introduced by new companies… but honest businessmen will stand by their products to the best of their financial ability… which sometimes will not cover the liability. So that's TWO cases where people are injured by faulty products, and cannot get recompense.)

    Thus, regulation is appropriate, not to supplant the free markets, but to supplement them, when they do not or cannot integrate all the costs into pricing. In a few, rare cases, a free market may be entirely unable to function effectively, and in those cases regulation may supplant them. (Note that admitting that such cases exist DOES NOT argue that any PARTICULAR market is so effected, and endless debate over this or that specific market remains likely.)

  63. James Pollock says

    "It would be like comparing the number of deaths caused by falling in airline travel against the number of deaths due to falling in auto travel and concluding air travel is more dangerous."

    I would hazard a guess that more people are killed by falling related to automobile travel than are killed by falling in air travel. (More correctly, by impact caused by falling, since it isn't the falling that kills you, it's that sudden stop at the end. As so carefully illustrated by the series finale of Futurama.)

    However, the relevant question isn't "is this product more or less dangerous than that product?", it's "are the risks posed by this product outweighed by the benefits of its availability?"… a question which both automobile travel and air travel are able to answer "no".

    Children are far more likely to be killed by an automobile than by a drop-side crib, but the benefits of being able to transport your child are higher than the benefits of not having to stretch so much to pick him or her up.

  64. George William Herbert says

    James Pollack:
    I haven't disassembled many speakers, but is that something a three-year-old can do?

    Oh, yes. Yes, yes yes yes. Quite literally, been there, done that. Yes.

    There are two issues here. One, any pair of powerful small magnets of the last 75+ years if swallowed (not at the same time, but separated by enough time that they don't connect up in the stomach) can click up through intestines and cause perforations. These magnets were most commonly found in industrial applications such as speakers etc, but were available individually or in bulk if you wanted them. I know a number of people who made toys with them 30+ years ago, myself included when I was 2-10 years old or so. The risk has been real for the entire time those magnets were in circulation. I was not aware of the risk when I was a kid; I would, these days, seek to keep a hypothetical child of mine from playing with such magnets until they're old enough to understand not to swallow them.

    Two, the population exposure of kids to magnets of that sort went from "a few thousands of kids" to "tens of millions of kids" with the little toy rare earth magnet sales starting a decade or so ago, so it got noticed in the statistical sense.

    There are plenty of things sold only to adults, which children can misuse to their peril. This ranges from alcohol to firearms to automobiles to household cleaning chemicals to over the counter medications. The particulars of this case are … sketchy. The claim that the CPSC is overreaching in establishing these are something they can or should ban, compared to other products, seems … weak.

    Not to mention that, as they have industrial uses, I can still buy them in bulk from industrial vendors (and attempts to ban those sales will undoubtedly result in an agency-terminal industry shitstorm down upon CPSC, as they're used in EVERYTHING…).

    (Disclaimer – My consulting client team has a few thousand of these magnets around the immediate office area. I am, have been, and remain an unrepentant magneteer.)

  65. George William Herbert says

    err, goofed; the claim that the CPSC isn't overreaching here seems weak, not the other way around. My bad.

  66. James Pollock says

    "I haven't disassembled many speakers, but is that something a three-year-old can do?
    Oh, yes. Yes, yes yes yes. Quite literally, been there, done that. Yes."

    Hmmm. I got motivated enough to look at the the speakers on my desk, the only ones I've bought in the last ten years. The plastic case is one piece (that is, it WAS several pieces, then it was assembled and glued permanently into one). I could smash one open and extract pieces, but I'd have to work at it.
    I think YMMV on this issue.

  67. Caleb says

    @James Pollock

    I would hazard a guess that more people are killed by falling related to automobile travel than are killed by falling in air travel.

    Eh, probably. But it illustrates my point: you cannot measure the raw number of incidents for any given product and come up with a meaningful proposition. Which, btw, is what it looks like the CSPC did.

    However, the relevant question isn't "is this product more or less dangerous than that product?"

    Actually, that question is helpful, insofar as the metric of the item in question is compared to other items which are allowed on the same metric. For example: is the chance of harm from children swallowing Buckyballs more or less than that of Legos ™? Or hotdogs? Or government-issues coinage? If the answer is "no," then the subsequent question is "then why target Buckyballs?"

    …it's "are the risks posed by this product outweighed by the benefits of its availability?"

    The problem with this aspect of the equation is that, apart from the metric of the economic market "libertarian" approach you outlined in your post above, there is no objective measure of social value. That is, if you are comparing cost vs. benefit, you have to go with either 1) the market cost-benefit calculus, or 2) a subjective and baseless calculation, which is inherently unjust by the premises of a liberal society.

    If you reject the market calculus, then the fundamental reason for banning any given product on a cost-benefit line of reasoning is essentially: "because I said so."

    Children are far more likely to be killed by an automobile than by a drop-side crib, but the benefits of being able to transport your child are higher than the benefits of not having to stretch so much to pick him or her up.

    Where does this assertion of value come from? Market analysis? Government findings? Your own head?

  68. James Pollock says

    "The problem with this aspect of the equation is that, apart from the metric of the economic market "libertarian" approach you outlined in your post above, there is no objective measure of social value."

    Sure there is, consensus can be measured.
    Take, for example, the proposition that a human being is worth more than a cow. Clearly, this isn't based on any kind of market analysis, because there is no legal market in people. However, I'm fairly sure I could get wide consensus on the topic, or more correctly, I would find wide consensus if I looked (yes, I could alter the odds substantially by how I worded the proposition; that's a different topic.)

    You can't rely on a purely monetary system of assigning value to things, because some things are not properly valued in monetary terms. This is one of the fundamental problems with letting every problem find a financial-market-based solution, and why we don't do that. (There's also race-to-the-bottom and problematic markets, again, different topic.)

    "If you reject the market calculus, then the fundamental reason for banning any given product on a cost-benefit line of reasoning is essentially: "because I said so.""
    It's just not that binary. To use the earlier example, I can point to a market to determine the relative value of drop-side cribs vs. solid cribs. I can point to a market to determine the relative value of owning your own vehicle vs. public transportation. I've no idea how to set up a market to compare the value of owning your own vehicle vs. drop-side cribs… but I can intuitively point to the right answer, based "just on my head". Will everyone agree with every answer I pull out of my head? I doubt it. Will I pull the same answer as the majority of people, nearly every time? I bet I will.

  69. Caleb says

    Sure there is, consensus can be measured.

    Consensus is merely the sum total of all a group of person's individual subjective valuations. It has no objective meaning in and of itself.

    Example: I own a set of buckyballs. You want to show me that, apart from my individual subjective valuation for doing so (which is high), there is a separate objective valuation that says the value of owning buckyballs is minimal. So you ask person A what their value of buckyballs is. They reply "minimal." Is there any reason that I should submit to person A's valuation rather then my own? No. So you ask person B, and they give the same answer? Now? If not, when?

    At what point does other people's subjective valuation become this independently qualitative "consensus?"

    Clearly, this isn't based on any kind of market analysis, because there is no legal market in people.

    Sure there is: life insurance, safety devices, life-saving medical procedures, ect. The NTSB famously has an economic valuation for human life to determine when to implement a safety device. The list goes on.

    You can't rely on a purely monetary system of assigning value to things, because some things are not properly valued in monetary terms.

    On individual terms, yes. There are many forms of valuation, and no one person constructs his or her valuation calculus the same as another. The problem comes in translation. How do I express my internal value of something to you in terms that you can understand and relate to? Obviously, some objective standard is needed. Something that is universally recognized as meaningful, valuable, and translatable into other forms of value. In other words, money.

    How else do you express value in a universally recognized format?

    I've no idea how to set up a market to compare the value of owning your own vehicle vs. drop-side cribs… but I can intuitively point to the right answer, based "just on my head".

    I'm not sure I understand your point here. Maybe elaborate a bit? It seems trivially easy to me to compare drop-side cribs versus vehicle ownership in the market: just compare prices. I think I'm missing something.

    Will I pull the same answer as the majority of people, nearly every time? I bet I will.

    And what is the effect of that agreement, and why? Does the existence of this majoritarian consensus impart any significant quality in and of itself? Or is it conditionally relevant given extrinsic social arrangements?

  70. James Pollock says

    "At what point does other people's subjective valuation become this independently qualitative "consensus?""

    Majority vote in both chambers of the legislature plus signed by the executive. (Details in your state may vary.)
    At that point, the dissenters may choose from a set of options:
    1) accept the consensus position and adapt behavior accordingly
    2) risk the punishment from the civil authorities for violating the consensus
    3) Remove yourself from the jurisdiction to one that shares your valuation.
    This is true whether your "subjective valuation" concerns toy magnets, illicit pharmaceuticals, or sexual acts with person considered underage by consensus.

    "How else do you express value in a universally recognized format?"
    You don't. Can't. Even MONEY isn't a universally recognized format, although it comes close, nowadays.

    "It seems trivially easy to me to compare drop-side cribs versus vehicle ownership in the market: just compare prices. I think I'm missing something."
    What is the price of being able to own your own vehicle? Not "what is the price to buy a vehicle", which is, of course, highly variable depending on which vehicle, which seller, and probably which day it is, but rather, what part of the price of buying a vehicle represents the part that is the incremental value of owning your own vehicle? Obviously, on any second vehicle purchase, that value is zero, because you already own your own vehicle… can you get a discount for that at the dealer?
    So now we're back to either A) the value is zero, because there's no monetary price associated with it, or B) the value is not, and cannot be, measured in terms of money.
    I submit that it is B.

  71. Caleb says

    @ James Pollock

    Majority vote in both chambers of the legislature plus signed by the executive. (Details in your state may vary.)

    That is a political process by which a society assigns legal status. Majoritarian republicanism is only one of the myriad of ways a society can assign legal status. It could also be direct majoritarian democracy, oligarchical diktats, monarchical decree, ect. Do each of these political operations form "consensus?" If yes, then how is "consensus" separate from legality? If not, then how is is related?

    This is true whether your "subjective valuation" concerns toy magnets, illicit pharmaceuticals, or sexual acts with person considered underage by consensus.

    Just because something is illegal doesn't mean it's valueless. If I found a brick of pure heroin on the streets, I might turn it in because I think the cost in terms of risk do not outweigh the benefit of selling it. (Or I might not.) But one thing I wouldn't do is think that it is valueless simply because it is illegal.

    Legal penalties simply shift around the costs and benefits of actions and items. They are not themselves the calculus by which value is determined in the first place.

    You don't. Can't.

    Then what rules of recognition have we that tell us when conditionally relevant metrics of value apply?

    Even MONEY isn't a universally recognized format, although it comes close, nowadays.

    Right. It's close enough to universal that the difference makes little operational significance. My point, exactly.

    What is the price of being able to own your own vehicle?

    Fairly high, but not infinite. There IS a dollar amount, which is my point. If you gave me enough money, I would certainly forego automobile ownership.

    …what part of the price of buying a vehicle represents the part that is the incremental value of owning your own vehicle?

    That's the great thing. My value in owning my vehicle (or any vehicle which fulfills the basic functional requirements) is WAY higher than what I paid for it. Consumer surplus and all that…

    …or B) the value is not, and cannot be, measured in terms of money.
    I submit that it is B.

    Are you saying there is no amount of money someone could plonk down in front of you to forego driving?

  72. James Pollock says

    "That is a political process by which a society assigns legal status."
    Yes. It's also the way consensus is established in the society I happen to live in.

    "Majoritarian republicanism is only one of the myriad of ways a society can assign legal status"
    Sure. It happens to be the one that is used in the society I happen to live in.
    The fact that there are many different ways of solving a problem doesn't say anything about the validity of any one of them.

    If it works (and I think it does) then I'm not inclined to seek alternatives.

    "Just because something is illegal doesn't mean it's valueless."
    Of course not. Value remains variable from individual to individual. But you asked about consensus; the consensus is that things that are illegal have no value.
    As I noted, you have the option then of accepting the consensus opinion as your own and adjusting your behavior to match; retaining your own value (risking sanction by the civil authorities), or physically removing yourself to a jurisdiction that has a consensus opinion that matches your own.

    "Right. It's close enough to universal that the difference makes little operational significance"
    Except when it isn't, which is MY point.

    "Are you saying there is no amount of money someone could plonk down in front of you to forego driving?"

    That's a different question than the value of owning your own vehicle. You can drive without owning, and own without driving. I've done both.

    And, I'm going to say, no. Having an arbitrarily large supply of money doesn't do you any good if you can't get to the store to spend it.

  73. Caleb says

    @ James Pollock

    So to you, consensus=legality, regardless of how legality is determined in any given society. But to you, consensus is also a measure of social value, acting as a conglomerate measure of the sum total of valuations each person in a society has toward any given thing.

    This makes no sense.

    Legality is merely an operative category by which the government denotes certain operations it will take given certain conditions. Think of it as a code. How that code comes to be is an open question. The input is undefined. By equating consensus with legality, you are merely mapping whatever operations the legal code makes and denoting it "consensus." You are stripping the term of any other meaning.

    If "consensus" means anything distinct from "legality", it must be the product of defined inputs. (Inputs which may or may not be the same as those for any given legal code.) You hinted that you think "consensus" can stand in for market valuation in given circumstances. What circumstances are those?

    …the consensus is that things that are illegal have no value.

    How is this statement different from "illegal things are illegal" or "the consensus is the consensus?" Does the consensus determine certain things valueless, and therefore illegal? Or does the law declare things illegal, which are therefore valueless by consensus?

    As I noted, you have the option then of accepting the consensus opinion as your own and adjusting your behavior to match; retaining your own value (risking sanction by the civil authorities), or physically removing yourself to a jurisdiction that has a consensus opinion that matches your own.

    If this is the case, how can "consensus" be fairly said to be a measure of social value? Unless by "measure" you mean "determine" or "dictate." If my difference of value determination has no logical input into the "consensus" metric, then it is useless as a metric.

    Except when it isn't, which is MY point.

    And how would you determine when that is?

    That's a different question than the value of owning your own vehicle. You can drive without owning, and own without driving. I've done both.

    Fair enough. I was trying to make the situation more extreme.

    And, I'm going to say, no. Having an arbitrarily large supply of money doesn't do you any good if you can't get to the store to spend it.

    You lack imagination. Hire a driver. Hire a helicopter. Pay someone to shop for you. Pay the stores to come to you. Bribe the city council to turn the local parking lot into a private airport. Buy the stores. Hire a bunch of engineers, designers, technicians, ect. to make whatever it is you want. An "arbitrarily large supply of money" is A LOT of money.

  74. James Pollock says

    "So to you, consensus=legality, regardless of how legality is determined in any given society."
    Not at all. Some consensus is expressed as legality. Some is not. Sometimes, legality is not based on consensus (although a strong enough consensus will change that, eventually.)

    "Does the consensus determine certain things valueless, and therefore illegal? Or does the law declare things illegal, which are therefore valueless by consensus? "
    These are largely interchangeable. The law follows consensus, and shapes it, as the persons making up the consensus change. This is why the law changes rather than being eternally static. When legislators, judges, and executive agencies make law, they attempt to do so by selecting a consensus position; sometimes they get it wrong (say, the 18th amendment) and have to fix it (the 21st).
    Sometimes the short-term consensus doesn't match up with the long-term consensus ("Japanese people are inherently suspicious and should be rounded up for full-time supervision" vs. "all people should be judged on their own actions and only on their own actions") which can lead to different laws at different times.

    "If this is the case, how can "consensus" be fairly said to be a measure of social value?"
    The same way a curve drawn through data points on a graph can be said to represent the data, even though not all points are on the curve.

    "And how would you determine when that is? "
    By using judgment.

    "You lack imagination. Hire a driver. Hire a helicopter. Pay someone to shop for you. Pay the stores to come to you. Bribe the city council to turn the local parking lot into a private airport. Buy the stores. Hire a bunch of engineers, designers, technicians, ect. to make whatever it is you want. An "arbitrarily large supply of money" is A LOT of money."

    No, I have TOO MUCH imagination. I can think of way too many situations in which an "arbitrarily large sum of money" (NOT a "supply", that implies an ongoing source of income. That's an oopsy-boo-boo.) will turn out to be insufficient to meet my needs.
    A sufficiently large rate of inflation can destroy any nest egg, given enough time.
    Outright currency collapse
    insurrection, war, or natural catastrophe.
    Nope. I'm not permanantly surrendering my options, in advance, for money.
    Besides, didn't you ever read the story of King Midas? and he had an unlimited SUPPLY of gold, not just an arbitrarily large sum.

  75. Caleb says

    Not at all. Some consensus is expressed as legality. Some is not. Sometimes, legality is not based on consensus (although a strong enough consensus will change that, eventually.)

    Okay, the concepts of consensus and legality are separate and distinct. By what parameters may we determine what the consensus is, as distinct from legality, and what effect does that have?

    These are largely interchangeable. The law follows consensus, and shapes it, as the persons making up the consensus change.

    This belies your trilemma of options for the non-conformist in your example above. If the person whose values clash with the law is also informing the process of determining the law, then his fourth option is to attempt to change the law to conform with his values. I suggest amending your example.

    What the law is is separate and distinct from what the law ought to be. Now the question is: is what the law ought to be separate and distinct from what the "consensus" is. The answer to that depends on how you answer my first question in this post.

    The same way a curve drawn through data points on a graph can be said to represent the data, even though not all points are on the curve.

    You know as well as I do (or probably better, your posts seem to indicate a mathematical bent) that the validity of fitting a curve to data points depends very much on the distribution of those points. Not all curves are equal. How, exactly, do we determine that the strength of the correlation we call "consensus" actually justifies its fit to the distribution of heterogeneous valuations in a given society? In statistics, there is a formula for determining the strength of a curve's correlation. In any statistical analysis, this is an essential parameter. In your consensus theory this parameter is assumed. What is it?

    By using judgment.

    Judgement as to what? Of what factors? What on earth does this mean?

    Judgement is a process, which takes certain inputs and gives outputs along logically legitimate lines. It must be distinct, objective, understandable, and repeatable in order for me to recognize it. You can't hand-wave this process away. You can't point to a black box and expect me to know what you mean and simultaneously recognize it as an legitimate, verifiable, and authoritative means of calculating value.

    A sufficiently large rate of inflation can destroy any nest egg, given enough time.

    Diversify your assets. I didn't say you had to keep the money.

    Outright currency collapse

    Buy land, commodities, and weapons. Everyone else is probably screwed too, but you'll be in the best position out of anyone. Or does the currency collapse happen immediately? If so, why?

    insurrection, war, or natural catastrophe.

    Then everyone is screwed. But having a #%@-ton of money sometime beforehand is better than not.

    You're trying to break the scenario. Do you have any good in-game answers?

    Besides, didn't you ever read the story of King Midas? and he had an unlimited SUPPLY of gold, not just an arbitrarily large sum.

    You've learned the lesson then. Good. Don't spend it all, watch out for inflation. Do these mitigating economic limitations make having an ungodly amount of money bad in and of itself?

    (btw, you appealed to majority and commonality as your reasoning for your non-monetary social value calculations. I can assure you that in the question of "unlimited heaps of money vs. relinquishing driving privileges" you are almost certainly in a rather significant minority.)

  76. James Pollock says

    "This belies your trilemma of options for the non-conformist in your example above. If the person whose values clash with the law is also informing the process of determining the law, then his fourth option is to attempt to change the law to conform with his values. I suggest amending your example."

    No, your fourth category falls under my second one.
    For example, abolitionists risked arrest and imprisonment for helping slaves escape bondage prior to the passage of the 13th amendment, bootleggers risk arrest and imprisonment for supplying the public with the liquor they wanted until the passage of the 21st, and gays risked arrest and imprisonment for pursuing a sex life prior to Lawrence v. Texas.
    Sometimes the consensus swings your way, and sometimes it doesn't. Women, hopefully, aren't still waiting for passage of the ERA, although they've certainly gained ground from the days when they couldn't own property (and even more from the days when they WERE property.)

    "Judgement is a process, which takes certain inputs and gives outputs along logically legitimate lines."
    Well, one kind of judgment works that way. Not all of them do. Induction, for example, and intuitive reasoning, rely on pattern-matching capabilities in the human brain that are not fully understood. Doesn't mean they don't work, though.

    "It must be distinct, objective, understandable, and repeatable in order for me to recognize it."
    That's your problem. I'd never even begin to try to fix THAT for you.

    "Diversify your assets. I didn't say you had to keep the money."
    Any diversification may be wrong. I owned GM stock.

    "Buy land, commodities, and weapons."
    That just makes me a target. An immodible target. No thanks.

    "You're trying to break the scenario. Do you have any good in-game answers?"
    Make up your mind… first I have NO imagination, and now too much. I'm standing my my original answer. No, there's no amount of money someone could pay me right now to permanently surrender my ability to own my own vehicle. I put value (infinite value) on my ability to keep all my options open.

    "I can assure you that in the question of "unlimited heaps of money vs. relinquishing driving privileges" you are almost certainly in a rather significant minority.)"
    Perhaps. It's not a very meaningful thought experiment, as it does not relate to very many people's actual experience. NOBODY is EVER faced with a circumstance in which their ability to own their own vehicle is restricted, and very few other things come close (old people and multiple-DUI convicts who have to give up their right to drive is close, bankruptcy typically shields a personal vehicle, unless there's a security interest in it, prisoners, of course, can own a personal vehicle but cannot make any use of it.)
    What amount of money would it take to get someone to agree to stay in the same room for the rest of their lives? (No fair asking people who have to stay in one room for the rest of their lives anyway because they're dying already). Even Howard Hughes came out occasionally.

  77. Caleb says

    No, your fourth category falls under my second one…Sometimes the consensus swings your way, and sometimes it doesn't.

    So, under your conception of social value, influencing the change of legality in any given society necessarily and rightly involves coming under the scythe of the existing law. What the law is and what it ought to be are mutually uninformed concepts. This is despite the fact that "consensus" (not to mention such frivolities as 'justice') may dictate a starkly different legal construct. A very harsh principle. But not one I can criticize, except on the basis of first principles. (On those grounds, I find it absolutely repulsive.)

    Incidentally, I have a two hard-core Hobbesian friends who would likely agree with you. Other than them and a few marginal philosophers, I would be hard-pressed to name any significant backing for your ideological construct.

    For that, I am grateful.

    Induction, for example, and intuitive reasoning, rely on pattern-matching capabilities in the human brain that are not fully understood. Doesn't mean they don't work, though.

    It also doesn't mean they aren't logical. Induction is a type of logic.

    You have yet to describe what you mean, or at least what factors you consider.

    That's your problem. I'd never even begin to try to fix THAT for you.

    If those are not the basis of external acknowledgement of other's construct of reality, pray tell what are. (And why I should accept them.)

    Any diversification may be wrong.

    Too true. Better sell all assets and buy goats then. Or can one be over-leveraged in livestock? I fail to see how this problem is unique to holding massive wealth, as opposed to any at all.

    That just makes me a target. An immodible target. No thanks.

    So you're better off not having any assets at all in a global disaster/collapse. Okay.

    Make up your mind… first I have NO imagination, and now too much.

    It's called a thought experiment. https://en.wikipedia.org/wiki/Thought_experiment
    The point is to assume the givens and work within that framework. If done correctly, it can help distill a principle or a pattern. Obviously, not everyone takes to them.

    If I say "assume someone offers you a principally unlimited amount of money to forego driving, also assuming normal circumstances" you answer within those parameters. So coming back with "well, what if there was an earthquake/war/currency collapse" is just as relevant as asking "well what if aliens invade?" It's outside the scope of the hypothetical, and not relevant to the question asked.

    No, there's no amount of money someone could pay me right now to permanently surrender my ability to own my own vehicle. I put value (infinite value) on my ability to keep all my options open.

    Fair enough. That's at least an in-game answer. (A patently ridiculous one, I think. But to each his own.) But I think you are hard-pressed to argue that it is a majority, or even common, answer.

    Perhaps. It's not a very meaningful thought experiment, as it does not relate to very many people's actual experience.

    That's not the point of a thought experiment. In fact, the exact opposite. If it was a common experience, we'd have actual data on the subject.

    The point is to illustrate the monetary transmutability of your proposed "valueless" asset of vehicular transportation. You claim to hold to that principle, but I doubt you can claim anything near universality, majority, commonality, or even instance. When the cold-hard cash is laid on the table, in the amount calculated to overwhelm the individual value of the asset traded for, there are few hold-outs. That's the point. You may reject such a phenomena, but you do so in the same capacity of a person trying to stop a freight train with a balsa barrier.

    What amount of money would it take to get someone to agree to stay in the same room for the rest of their lives?

    Depends on the person. A larger amount than exists for most persons, I expect. Which does not undermine the method of measure, merely the probability of the transaction taking place. Your point?

  78. James Pollock says

    "influencing the change of legality in any given society necessarily and rightly involves coming under the scythe of the existing law."

    I'm not quite sure what it is you're getting at, here.
    From a pragmatic scenario, there are two choices for dealing with the law of the land… it either applies to you, because you live in the jurisdiction, or it doesn't, because you left the jurisdiction. If the law applies to you, there is a further bifurcation… you either comport yourself to the behavior the law allows, or you do not and risk reprisal by the civil authorities. Either of those can be an avenue of change for the state of the law; "progress"* is usually but not always faster for those who choose to fight, and in either case, sometimes the law doesn't change the way we want it to, leaving emigration as an option. Note that "law" is only one way that social consensus can be expressed.

    "It also doesn't mean they aren't logical. Induction is a type of logic."
    So's intuition. These are all different kinds of logic (or, to use the word we had before, "judgment". They don't all work the same way. As noted, both induction AND intuition require use of the pattern-matching capabilities of the human brain, which are NOT fully understood.

    To recap, not all processes of judgment make use of deductive logic.

    "I fail to see how this problem is unique to holding massive wealth, as opposed to any at all."
    It counters your (implied) claim that a suffciently large sum of money cures all problems. It does not. You solve some problems, but get others; it tends to move most problems from short-term to longer-term.

    "So you're better off not having any assets at all in a global disaster/collapse. Okay."
    Quite possibly… if everyone knows you have assets, they're all coming. Better to be nimble and able to collect assets as they're needed. (Insert allegory here concerning dinosaurs and mammals 65 million years ago.)

    "It's called a thought experiment."
    Yes, I'm familiar with the concept. In fact, it's MY thought experiment, remember? What is the value of owning your own vehicle? How would you find out? Familiar?

    "If done correctly, it can help distill a principle or a pattern."
    Only if it has referents.

    "If I say "assume someone offers you a principally unlimited amount of money to forego driving, also assuming normal circumstances" you answer within those parameters."
    If you did, those three differences from the question we were working with before (limited sum vs. unlimited, driving vs. vehicle ownership, limited to "normal" circumstances) would change the outcome, perhaps significantly. Let's test it out. How much will you give me, right now, if I promise to forego driving, under normal circumstances? See, that's a thought experiment that's grounded and has meaning.

    "That's not the point of a thought experiment. In fact, the exact opposite."
    Now you're making stuff up. To have any meaning, a thought experiment has to have meaningful referents to a person's actual experiences, because if it doesn't, there's no basis to make any kind of decision. So if our thought experiment is "what would you do if space aliens attacked", you have meaningful referents… you know what happens when something is attacked; you're probably familiar with "War of the Worlds", "Independence Day", and the like, and these referents shape your answer. There is something that's not an everyday occurrence, in fact, something that has (so far as we know) never happened, but we have meaningful referents to use in formulating our answer.

    Compare that to the thought experiment "what if blue and loud were the same thing?", the only rational response to which is "huh?"

    "If it was a common experience, we'd have actual data on the subject."
    I didn't say it had to be a common occurrence, I said it had to have referents that the answerer is familiar with.

    If you ask 100 people (or any sample size you like) "what would you do if somebody gave you $20 to spend any way you'd like?" and people can answer that. The higher the number, the less meaningful the answer gets, because there's no referent.

    "The point is to illustrate the monetary transmutability of your proposed "valueless" asset of vehicular transportation."
    Don't go trying to change the terms, here. I didn't say that the ability to own your own vehicle is "valueless"; it has value. I said that the value can't be measured in money.
    Try thinking about it a different way. There's no market for it. Where no market exists, you cannot measure the value of something in money. The price demanded by any seller is higher than the price offered by any buyer. No sales. No sales = no market.

    "Which does not undermine the method of measure, merely the probability of the transaction taking place."
    As the probability of transactions taken place approaches zero, the utility of using market transactions to determine value does, as well.

    *"progress" is what we call it when things change the way we want. When things change the way we don't want, there are all sorts of names for it.

  79. Castaigne says

    @Caleb: M&O were fine with a redo of the 2009 recall.

    It is obvious from the resulting injuries SINCE the 2009 recall that a "redo" would not be sufficient. Is the CPSC supposed to be fine with duplicating a procedure that didn't work ad infinitum?

    CPSC was not.

    *looks at the surgeries* Gee. What a shocker.

    M&O filed their corrective action plan, the CPSC rejected it, then filed the complaint the next day.

    Yes. Zucker refused to further discuss the issue after rejection.

    But rejected the corrective action plan. You have an odd idea of "trying to work" with someone.

    Let's test this. I'm Zucker. I submit to to the CPSC a plan that is the same shit I did in 2009 and has not worked sufficiently. The CPSC says "That ain't going to work. We need something better.

    My response is going to be "Let's sit down at the table and see what we can work out."

    Zucker's real response was "Fuck you bitches; I don't give two shits about those magnet-eating motherfuckers. and extend both middle fingers.

    Is my reaction "trying to work" with the CPSC? Or is Zucker's? Which do you consider the more rational and logical approach?

    That alone is not a ship-sinker. There are lines of credit and other financing options available for companies who have a popular product with unforeseen liability costs.

    You would lend to a guy acting like Zucker did? Your money to lose. I know of no bank, lending agency, or venture fund that would approach someone acting like an asshole maverick. It's just not good business.

    What is fatal is starring down those liability suits when your corporation suddenly has no revenue.

    That's what happens when you act like a fucking moron. This is no different. See the asbestos manufacturers. Didn't work for them either.

    ke if, say, an overbearing government agency wants you to stop selling and is intimidating your retailers into dropping their contracts.

    I posted links to the text of the letters sent.
    Tell me what you find intimidating about it. Because I sure don't see a "OR ELSE, FUCKWADS" anywhere in it. It's pretty rational to me: these guys refused to negotiate and so we were sadly forced to take these actions. We are going public with it.

    In short, I see no threat in the letter. Show me what you think the threat is.

    If the CSPC is going after Zucker because he improperly divested corporate funds away from civil liability payments, then it IS overstepping its authority, and IS acting like a vindictive bully.

    &

    My argument is that if CPSC had the authority to apply the responsible corporate officer doctrine to a corporate officer who did not break the law, then one of two things would be true: 1) they would have clear, plain language statutory authority for doing so, or 2) they would have case law that said they have that authority. CPSC clearly does not have 1), not even they are claiming so. They claim to have 2). That argument is facetious, as the link you first provided so clearly argued. Lacking 1) or 2), the agency does not have legal authority for what it is doing.

    Then feel free to prove this. Help Zucker file against the CPSC with this reasoning in federal court. Seek a judgment declaring that the CPSC decisions on the matter are contrary to law, step outside the bounds of their authority, and get an injunction against the CPSC forcing them to rescind their decision.

    The former directly impacts the latter question.

    Bullcrap. Philosophical questions are airy-fairy speculation engaged in by opium smokers looking for "the truth". There is no truth. There is only fact, math, and procedure.

    Law is the computer programming of human society. You are claiming that the CPSC has violated its programming strictures. I have yet to see you prove that those programming boundaries have been violated. Let me know when you do.

    I hope he does so.

    Zucker isn't and won't. He knows he'll lose, and he knows that because he's been told by his own legal peeps that he's wrong.

    But you have the argument backwards. An agency can only act pursuant to a law. They are not only bounded by what the law says they can't do. For every action they take, the burden is on them to point to a law that says the CAN do so. This is a pretty foundational concept in government law.

    And that's where we part ways. I disagree with your foundation. Here is MY foundational concept for government law and regulation (in fact, for ALL law):

    That which is not EXPLICITLY FORBIDDEN is ABSOLUTELY PERMITTED.

    So unless you can show me that the CPSC is EXPLICITLY FORBIDDEN from doing what they're doing, as far as I'm concerned they've got the chops.

  80. Caleb says

    @ James Pollock

    I'm not quite sure what it is you're getting at, here.

    What I'm getting at is that using the law as a necessary metric for determining "consensus"-as defined by conglomerate social value- and only allowing for that metric to change as a result of the law's punishment of non-conformists is a rather disturbing principle. It means the persons within a society must necessarily and rightly suffer punishment under the law in order for their valuations to be fed into the calculus. Like I said, it works logically, but I find it abhorrent.

    Either of those can be an avenue of change for the state of the law;

    How? You have yet to identify the mechanism.

    Note that "law" is only one way that social consensus can be expressed.

    And the others? This is what I wanted to know in the first place.

    To recap, not all processes of judgment make use of deductive logic.

    Granted. But that doesn't mean the process isn't describable, at least in broad terms. What factors are there? How are they weighed? By what criteria?

    The alternative is that when you assert your "judgement" as to this question, I have no means by which to scrutinize that pronouncement. Your proclamation would be irrefutable. Surely you see what I would object to that?

    It counters your (implied) claim that a suffciently[sic] large sum of money cures all problems.

    If you think that is what I'm arguing, you are way off the mark. I recognize full well that certain occurrences are not adequately compensated by monetary transactions. That does not refute my argument.

    My claim is that monetary measurement (or any other fungible units of economic exchange) is the only valid, objectively verifiable measure of value. That certain things are not compensable does not mean they aren't measurable. There are many (usually unfortunate) circumstances which create their own world of value creation or destruction. By their own lights, they are not comparable to anything else. But our ideas of justice, risk mitigation, transactions, and trade, all of these circumstances are compressed into monetary format for the purposes of exchange. Does the monetary value capture all potential subjective value? Of course not! But there is no other extrinsic method of measure. That's my point.

    Let's test it out. How much will you give me, right now, if I promise to forego driving, under normal circumstances?

    Not much, because I don't care what you do. There's no value for me there. But let's change the scenario, and instead of just "you," make it roughly 10,000 drivers in the northern Virginia metro area. Now I'm reaching for my wallet.

    Don't go trying to change the terms, here. I didn't say that the ability to own your own vehicle is "valueless"; it has value. I said that the value can't be measured in money.

    You're right, sloppy wording on my part.

    Try thinking about it a different way. There's no market for it.

    With a sufficient numbers of drivers, sure there is! Or we can easily collect enough meaningful referents to construct one. Roadway space is a scare good, people using it means other can't at the same time. Here in NOVA, they just installed "paylanes" which charge extra to drive in limited traffic lanes. The price goes up automatically as traffic increases. Public transport, high vehicle taxes, limited parking spaces, all these impact the costs and the benefits of driving in this area, and can be (and are, if you look at the state DOT's commission grants) expressed in purely monetary terms.

    Where no market exists, you cannot measure the value of something in money.

    Just because there is no market for a thing means we can't meaningfully imagine one existing? I reject that premise. People monetize and commoditize things never before sold all the time.

    As the probability of transactions taken place approaches zero, the utility of using market transactions to determine value does, as well.

    An interesting proposition. Let me pose a counter-example: The chance of me selling a kidney right now is roughly zero. It's illegal, and I like having two. However, if it were legal for me to do so, there would be a circumstance under which I would sell it. That is: a mountain of money. I would even do it illegally (or at least travel to a place where it is not illegal), if compensated even more. Now, given from what I've read about the black market for kidneys, the price would likely not reach my marginal utility. Probably not even close. Does the lack of a probable transaction make my economic valuation for my kidney useless? If so, what alternative measure do I use?

    *"progress" is what we call it when things change the way we want.

    Who's "we?" How can "we" tell things are changing the way "we" want? This goes back to my statistics point earlier.

    @Castaigne

    I submit to to the CPSC a plan that is the same shit I did in 2009

    Was it the same? I've seen no evidence of that. From what I understand it was a more aggressive public education campaign and warning publications. To the degree that it not recommend ceasing selling…well yeah. That's their whole business.

    Yes. Zucker refused to further discuss the issue after rejection.

    The rejection came within hours of the complaint filing. What else he could do once the complain was filed?

    I submit to to the CPSC a plan that is the same shit I did in 2009 and has not worked sufficiently. The CPSC says "That ain't going to work. We need something better.

    The CPSC voted to file the complaint before the corrective action plan was filed.

    http://www.cpsc.gov/PageFiles/134321/maxfieldoberton.pdf

    It's obvious that CPSC was planning on filing the complaint regardless of what was in the corrective action plan. What could Zucker do? Are you saying that CPSC would have foregone the complaint if he had know-towed enough in the plan. The facts sure don't make it look that way.

    Zucker's real response was "Fuck you bitches; I don't give two shits about those magnet-eating motherfuckers. and extend both middle fingers.

    I see no evidence of that reaction. Yes, Zucker's tone was defiant. So what? Civil servants need a thick skin. If they went after Zucker because of his tone, then that proves Clark's point. If they went after him because of substantive issues, then why did they vote to bring the complain before the plan was filed?

    Is my reaction "trying to work" with the CPSC? Or is Zucker's? Which do you consider the more rational and logical approach?

    I see little evidence that would indicate that the CPSC had cooperation in mind with Zucker. If this were not the case, why vote to bring him down before hearing him out? Zucker had a choice: grovel more, and hope for mercy, or bring his complaints to the public. Considering that the chance of the CPSC dismissing the complaint was roughly a snowball's chance in hell, he went for the latter. I don't blame him.

    I posted links to the text of the letters sent.
    Tell me what you find intimidating about it

    Those links aren't the letters sent, just the press release talking about them and the complaint.

    It does say though that:

    In response to a request from CPSC staff, a number of retailers have voluntarily agreed to stop selling Buckyballs, Buckycubes, and similar products manufactured by other companies.

    That is, the CPSC asked retailers to cease distribution of a product before any legal findings had come out, or even before the beginning of any. Why would the sellers comply, unless they smelled the blood in the water and thought it was a good time to leave? Don't you find it the least bit disturbing that the CPSC can effectively recall a product without an iota of legal proceeding?

    Then feel free to prove this.

    I've gone as far as I can with current information and law available. Or is the fact that the there is an open legal proceeding mean no one gets to espouse their opinion on the matter (besides you, of course)?

    Bullcrap. Philosophical questions are airy-fairy speculation engaged in by opium smokers looking for "the truth". There is no truth. There is only fact, math, and procedure.

    That in and of itself is a philosophical statement on the nature of truth.

    I have yet to see you prove that those programming boundaries have been violated. Let me know when you do.

    Law is more uncertain than that. "Proof" in the hard sense is hard to come by. I have given you my argument, and referred to others where relevant. You could respond to it, pose your own argument, or sit and jeer. Makes no difference to me what you do.

    Zucker isn't and won't. He knows he'll lose, and he knows that because he's been told by his own legal peeps that he's wrong.

    Evidence for this claim? As far as I can tell, litigation is still ongoing. Looks like they're in discovery phase from the documents on the CPSC website. http://www.cpsc.gov/Global/Recalls/Recall-Lawsuits/NoticeofServiceofRespondentsFirstSetofDiscoveryRequests.pdf

    Where do you get this stuff?

    Here is MY foundational concept for government law and regulation (in fact, for ALL law):

    That which is not EXPLICITLY FORBIDDEN is ABSOLUTELY PERMITTED.

    Well, you can have whatever principle you want, but it directly contradicts established American administrative law:

    The reviewing court shall hold unlawful and set aside agency action, findings, and conclusions found to be in excess of statutory jurisdiction, authority, or limitations, or short of statutory right

    5 U.S.C. § 706(a)(2)(C) (emphasis mine)

    So unless you can show me that the CPSC is EXPLICITLY FORBIDDEN from doing what they're doing, as far as I'm concerned they've got the chops.

    Sorry, that's not how it works. You can protest all you want, but the law is fairly clear on the subject.

  81. James Pollock says

    "The alternative is that when you assert your "judgement" as to this question, I have no means by which to scrutinize that pronouncement."
    This would be true only if you had no human brain upon which to draw. You use the pattern-matching circuitry that exists in YOUR brain (NOT the deductive logic part) to derive your judgment. The average of this product is the "consensus", which guides the masses. Trying to (deductively) reason your way out of it is a waste of time.

    "But let's change the scenario, and instead of just "you," make it roughly 10,000 drivers in the northern Virginia metro area. Now I'm reaching for my wallet."
    How much? I need to know your offer before I can start to try to arbitrage it.

    "Just because there is no market for a thing means we can't meaningfully imagine one existing? I reject that premise."
    How is meaningful if everyone can imagine something different? Even in things are sold, however infrequently, if there aren't enough transactions, you can't use a market mechanism to reliably value something. What's the current value of a 1933 Double Eagle?

    "People monetize and commoditize things never before sold all the time."
    Yes they do. They create a market, and once they've done that, it can be used to evaluate value. But BEFORE they do, it can't.

    Markets are a valuable tool for establishing value, but the accuracy varies. In an ideal (commodity goods, no barriers to entry or exit, perfect knowledge by all players, etc.) it is in fact pretty much 100% accurate. But as you move away from those ideal markets, it gets less and less accurate, until you reach whatever arbitrary level of inaccuracy that means you can't rely on it any more.
    Then, there are some things which don't have any market at all, because the price demanded by all willing sellers is higher than the price offered by any willing buyers. (Or things for which there are no willing sellers or no willing buyers or both). Your response to this category is that there are values set for these things… but if you look closer, you see that the price is set by one party or the other and imposed by fiat AFTER THE FACT. ("sorry, you only get $100,000 for having your arm cut off, because that's all the insurance company will pay" does NOT mean that the value of having an arm cut off is $100,000". There are no willing sellers at that price.)

    This is the challenge of why "fair market value" is one of the most hotly contested issues in courtrooms (Not in the same range as innocence/guilt or married/divorced, but it's big enough to be its own legal specialty.)

  82. Caleb says

    This would be true only if you had no human brain upon which to draw. You use the pattern-matching circuitry that exists in YOUR brain (NOT the deductive logic part) to derive your judgment.

    Perhaps my brain is different. Or perhaps I purposefully disregard the outputs of that section of my brain because it is notoriously unreliable. I get that you are making an "irreducible complexity" argument. The problem with that is neither the inputs, the process, nor the output is scrutable by conscious logical analysis and verifiable standards. We have to "take it by faith" as it were.

    The average of this product is the "consensus", which guides the masses. Trying to (deductively) reason your way out of it is a waste of time.

    Hallelujah, and can I get an amen!

    How much? I need to know your offer before I can start to try to arbitrage it.

    More than I can afford, sadly. But I like the idea! We get a bunch of rich D.C. mover-and-shaker type commuters to pool their resources to buy out the rights of use from low-value road users (during rush-hour, particularly). Our fee is a commission off the top. The problem is enforcement, of course. Really high start-up costs.

    How is meaningful if everyone can imagine something different? Even in things are sold, however infrequently, if there aren't enough transactions, you can't use a market mechanism to reliably value something. What's the current value of a 1933 Double Eagle?

    At least ~$8mil, if I recall correctly. Probably more now.

    You seem to be confusing inaccuracy and uncertainty with invalidity. Remember, no method of measure is 100% accurate or certain. There is always a margin of error. There is no way we can predict with absolute certainty what any given commodity will sell for, even in the most established markets, until the sale occurs.

    Yes they do. They create a market, and once they've done that, it can be used to evaluate value. But BEFORE they do, it can't.

    Point taken: yes, there is a difference in certainty between retrospective and prospective valuation. But prospective valuation is uncertain regardless of metric. Any proposed substitute for monetary valuation will suffer the same flaw.

    Markets are a valuable tool for establishing value, but the accuracy varies. In an ideal (commodity goods, no barriers to entry or exit, perfect knowledge by all players, etc.) it is in fact pretty much 100% accurate. But as you move away from those ideal markets, it gets less and less accurate, until you reach whatever arbitrary level of inaccuracy that means you can't rely on it any more.

    You talk of more accuracy and less. These are only meaningful terms if there is an alternate method of measurement, by which we may compare. Despite our long conversation, you have yet to enlighten me as to the metrics of that measurement. (Other than "consensus," which you claim has no metrics. Or at least, no scrutable ones.)

    Your response to this category is that there are values set for these things… but if you look closer, you see that the price is set by one party or the other and imposed by fiat AFTER THE FACT. ("sorry, you only get $100,000 for having your arm cut off, because that's all the insurance company will pay" does NOT mean that the value of having an arm cut off is $100,000". There are no willing sellers at that price.)

    Ah, yes, here we go. The difference between willing and unwilling participants in the market is the biggest weakness in my argument (that I can see, at least). And I admit, the notion of an "unwilling participant" undermines the very concept of "transaction" which I have been using to this point. It's a problem.

    All agreed.

    My point is, even in the face of this rather glaring flaw in the theory (and I make no bones about how big a flaw it is) there is not a single, more suitable alternative of measure. It's not ideal, or the theoretical best. But it's the least-worst, and right now the only player on the field.

    This is the challenge of why "fair market value" is one of the most hotly contested issues in courtrooms

    Yes! Indeed it is. And it is for the reason I admitted above. It's a flawed theory of value. But what alternative do we have?

    (If you have a meaningful and persuasive answer to that question, particularly to the aspect of unwilling participants and legal claims, I promise I will work with you on the paper to get it published.)

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