The Gilder Friday Letter v.96.0
from Gilder Publishing
THE FRIDAY LETTER
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Issue 96.0/February 28, 2003
* The Week/Let Them Eat Fiber
* Friday Feature/Charlatans and Cranks
* Friday Bonus/ Biosensors Are Not Bioshields
* Poll Question/
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THE WEEK/Let Them Eat Fiber
To the annals of arrogant irresponsibility-along with "Let them eat cake,"
"Saw off California and float it out to sea," and "depends how you define
sex"-can now be added a new shining example of suicidal insouciance.
Perpetrator of the new "What me worry" madness is the Federal
Communications Commission, which under the leadership of Michael Powell and
his one-time prot�g� Kevin Martin, are inharmoniously fiddling away amid
the smoldering cinders of the communications sector.
Although the ostensible explanations are hard to hear through the hiss of
the Washington rumor mill, detectable themes include: "Give telecom to the
states"..."Let them eat fiber"...and "Saw off broadband and float it to
Asia." Indeed, the largest effect of the fiddling is to surrender U.S.
leadership in communications technology to beleaguered South Korea and to
China, supposedly still a developing country.
Powell commendably promised "fast and furious" deregulatory changes. But
last week he said reforms should be phased in over another two years.
Meanwhile, Martin's bright idea is that the industry submit to the mercies
of 50 state public utilities commissions. As the FCC split the broadband
baby in two and minced it in with the bathwater in an incredibly muddled
decision last week, everybody seems to believe that telecom disputes are
special interest pettifoggery between long-distance and local rather than
the expression of huge changes in the industry that make all such
In an era when it costs no more to call across the continent than to call
across the street, a states-rights pricing system is an egregious
absurdity. Improving potential cost effectiveness at a rate of some six-
fold every year, telecom can no longer prosper in a political tug-of-law
among fractious state commissions plus scores of fee-chasing mayors, and a
menagerie of anti-trust beadles and regulatory vandals in the Federal
An alert Supreme Court--will simply ban all federal efforts to assign
telecom regulation to the states as an obvious and extreme violation of the
commerce clause, since telecom is the most interstate industry there is.
The only locality in telecom is now the "light cone" of points reachable at
the speed of light.
Read George Gilder's entire reaction to last week's FCC decision at
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Friday Feature/Charlatans and Cranks
One of the president's most talented economic advisers, Glenn Hubbard, has
resigned as chairman of the Council of Economic Advisors. The White House
has apparently chosen Harvard economist Gregory Mankiw as his successor.
This is a pivotal position in the White House. It is imperative that
President Bush put a strong and persuasive advocate of supply-side economic
policies in this top job - someone to help sell the financial benefits of
the current tax-cut plan and pursue even bolder pro-growth policies down
Professor Mankiw is not that man. I say this never having met or spoken to
Mankiw. I say this as someone who has read his writings. The Bush
administration should too.
I would refer the White House to the third edition of his book
Macroeconomics. In that book, Mankiw refers to Ronald Reagan's supply-side
advisers as "charlatans and cranks."
For several years Mankiw has indoctrinated young economists with
wrongheaded thinking about supply-side economics. And the statements are
now a matter of public record that will no doubt come back to haunt Mankiw
if he gets the job of selling President Bush's supply-side policies.
Mankiw was also an informed adviser to presidential candidate John McCain
in the 2000 election. McCain attacked Bush's economic and tax-cut agenda.
This, too, does not inspire confidence in Mankiw.
The good news is there are a multitude of brilliant supply-side academics
who would be superb chief economists at the White House. I am thinking of
talented people like Brian Wesbury of Chicago, Richard Vedder of Ohio
University, and David Malpass of Bear Stearns.
Mankiw is right about one thing. The economics profession is filled with
charlatans and cranks. Let us hope that Mr. Mankiw is not one of them.
Stephen Moore cautions us to think twice about Gregory Mankiw becoming the
next chairman of the Council of Economic Advisors. Be sure to read the
entire article at http://www.nationalreview.com/moore/moore022803b.asp
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Friday Bonus/Biosensors Are Not Bioshields
Treatments for bioweapons are diametrically different for the needs of a
soldier stationed on the battlefield and an ordinary office worker. The key
for Pentagon planners is to keep their troops on the battlefield in peak
performance. That means protecting them from succumbing to a biological
agent in the first place, mostly with preventative vaccines. The Pentagon
can't risk troops being sick, even if it was only for a few days, say,
until antibiotics or antiviral drugs took effect.
By comparison, civilians are less likely to face biological agents, and so
vaccinating them for the full spectrum of bioweapons isn't practical, or
even necessary. But ordinary Americans still need countermeasures.
In the face of a domestic attack, doctors might not be as concerned that
civilians could fall ill to bioagents, so long as they had the tools to
completely cure everyone. So, what civilians need are effective treatments
that can be stocked on hospital shelves, and used to treat sick patients
and mitigate the effects of an attack. The problem is that most of the
research in bioweapons countermeasures has traditionally focused on the
needs of the Pentagon. So, treatments have been given short shrift in favor
Dr. Scott Gottlieb informs us of the need for bioweapon antidotes as well
as vaccines. Read the entire article at http://www.washtimes.com/op-
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Gilder.com Poll: Mike Tyson's Tattoo
Too much: 68%
Not enough: 20%
Just right: 12%
Up Next: Planning to upgrade your mobile phone this year?
Let us know at http://www.gilder.com/
Qualcomm Brews Up JV with China Unicom
AOL Offering Music Catalog for Downloads
HP: Profits Strong, Sales Lag
Cisco's Power Grab: Wireless LANs
EMC Bid Reportedly Sets Pace for Legato
Mobile Browser Battle
Internet Traffic Redux
IT Leaders Learn How to Get More Out of Their Geeks
Enterprise Instant Messaging Takes Center Stage at Conference
Convergence Products Require Mix of Technologies
FCC Tests Reception for Lifting Ownership Limits
The Diversity Divide
Info tech market predictions for Europe, Asia, US
Price Cut for Starbucks WiFi
The Private Capital Survival Guide
Dream Unmet 50 Years After DNA Milestone
An Inventor of the Transistor Has His Moment
Ratings Agency Says It Erred in Measuring Web Site Use
Firing Leaflets and Electrons, U.S. Wages Information War
Twilight of the CD? Not if It Can Be Reinvented
E.P.A. Approves Altered Corn
FRIDAY LETTER STAFF
John Hammill (jhammill@...)
Sandy Fleischmann (sfleischmann@...)
CONTRIBUTORS THIS WEEK: Spencer Reiss
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