Press Ethics Alert

"The latest episode raises a serious question of journalistic ethics," writes Howard Kurtz, press ethicist for The Washington Post. How so, Howie? The Harvard Business Review "lets its subjects read drafts of the interviews and suggest all kinds of changes and deletions until they are satisfied," Kurtz responds. You don't say.

Isn't that the whole point of the Harvard Business Review? To publish the words and thoughts of business leaders and strategists (and Harvard Business School professors) exactly as they would want them published? And which is better: a clear explication of Jack Welch's management practices or using press ethics as a platform to titter about his sex life?

Apple on the Comeback Trail

Stewart Alsop has a smart column on Apple's resurgence. He thinks the new iMacs will help the company recapture some of the 10% market share it used to have with business customers. And he points out that many of the "issues" that made Apple computers incompatible with Windows-based computing world are no longer "issues."

More important, he rightly points out that the new iMacs offer fantastic software applications for managing digital media. To the text we go:

Apple Computer appears to have actually developed a real, applications-based software strategy. In my 20-plus years of observing the computer industry, I've found that hardware companies don't do software well and that software companies don't do hardware well. There are a lot of conflicts between the two. The business models are antithetical, and the engineers don't understand or like each other. So it is all the more remarkable that the programs that Apple now ships with its computers are actually really good: iMovie, iDVD, iPhoto, and iTunes represent a coherent set of applications for managing digital media that doesn't exist anywhere else. The integration among the applications is at least as good as in Microsoft Office--a huge element in the success of Windows.

Exactly right.

Blogger Down

Evan Williams, the man who wrote the code that makes blogging and blogspots like this one possible, took the Blogger Pro application software down today for some re-tooling. This is why the blogs went dark for a time. We're back up now and perhaps a bit more appreciative of Mr. Williams's extraordinary gift to writers everywhere.

Granholm Surge in Michigan

The surge of Michigan Attorney General Jennifer Granholm (D) in the Democratic gubernatorial primary is noteworthy and spells trouble for the GOP in the future. Yes, the Detroit News poll numbers are based upon a relatively small subset of likely Democratic primary voters. But those numbers don't differ much, if at all, from what private polls are showing.

Assuming Ms. Granholm is able to hold her grip on female Democratic primary voters (who now support her by margins of better than 2-to-1), she'll probably win the early August primary. According to the News survey, Granholm enjoys a huge lead over the likely Republican gubernatorial nominee (and perhaps appropriately named) Lt. Governor Richard Posthumus.

One has the sense that the national Republican Party may cut its losses in Michigan and redirect resources to other key states (like Pennsylvania and Illinois). If that happens and Granholm wins both the primary and the general election by wide margins, then a new Democratic star will be born. More important, Democrats will control the governor's office in a key battleground state in 2004.

Now If They Could Just Get That Signal Thing Down

Good news for road warriors. Scientific American reports that scientists at Lawrence Livermore have come up with a "portable fuel cell energy source" that can power a mobile phone or laptop computer longer than the current batteries do. And it's cheaper. Straight to the text we go:

The days of fast-fading cellular phone batteries may soon be over. Researchers at the Lawrence Livermore National Laboratory (LLNL) recently developed a working prototype for a portable fuel cell energy source that could power a cellular phone 300 percent longer than existing rechargeable batteries do. Indeed, the new technology would be less expensive, smaller and more powerful than any battery currently in use, according to Jeff Morse of LLNL's Center for Microtechnology Engineering. He predicts that it could replace standard lithium-ion and lithium-ion polymer batteries in a number of consumer electronics products, such as laptops and handheld computers.

God bless 'em.

A Really Bad Idea

Glenn Reynolds has a good column today on the Security Systems Standards and Certification Act, which would mandate the inclusion of copy-protection in every digital device and every computer operating system. The Libertarian Samizdata blogspot recently published an equally persuasive letter by Paul Allen on this issue, which is worth quoting at some length. Mr. Allen writes:

As any programmer worth his/her salt will attest, given the resources, anything that can be programmed into a computer can be programmed out, or worked around. In the case of copy protection such as the SSSCA would require, the resources needed for circumventing it is simply the source code for the operating system of the computer, and/or other source code for applications used on the computer (such as one of the many free video/audio layers available). Now given the wording of the SSSCA, along with the DMCA and other supporting laws, it stands to reason that such Free Software would suddenly become a target for legislation. Such legislation logically may require such software to be judged illegal. Such a decision may have serious consequences to the IT industry as well as the entertainment industry and the consumer as well. Little may the consumer or entertainment industry know, but much of the technology they rely upon today is provided at low cost by Free Software. Take that software away, and suddenly doing business costs a lot more, and eventually the consumer just will not be willing to pay for it.

Now aside from the consequences to Free Software, what about the consequences to those who do not use such software. Imagine that home movie you shot last weekend on vacation. Now you wish to send that home movie to a relative, friend, whoever, over the Internet, or place it on your web site for all to download. Well, with many of the protection technologies suggested, this would not be possible, or would be extremely difficult. Some of these technologies require digital watermarks to be placed in the media, for one example. CD burners, digital cameras, etc. can not make these watermarks. The copy protection works by checking for such a watermark, and if it does not exist, the system either will not allow the media to be played, or will not allow it to be transmitted over the Internet as the case may be. So much for sending your cousin your latest home movie, or allowing your whole family to see it from your web site. An additional problem is all current media, including CDs and DVDs, you may currently legally own would not work on proposed new CD and DVD players with copy protection hardware. You would not be able to copy CDs, tapes, or anything else that you legally own in order to exercise your right to fair use, so as to listen to that CD on the cassette deck in your car.

I could go on, but I think this is long enough and has given some food for thought. Besides, I have work to do. Election time is near, so think about what that person you are voting for represents. Think about actually writing a letter to a congressman or other legislator, to a magazine (I actually had one published once, so its not beyond the realms of possibility), newpaper, etc. Many people have the attitude that they can do nothing and make no difference. Well, I say to them they are right, because there are so many people with that attitude, that none of them do anything and they make no difference in doing so. The ones that make the difference, are the ones taking a stance, and the ones taking the stance are the ones that are causing these ridiculous laws to be passed. Guess who those people are?...

Email is particularly effective.

The War and Its Critics

What do you think the chances are that New York City will be hit again before the year is out? Fifty-fifty? Two-to-one? If you asked the people who see and read all of the classified intelligence reports and have access to every last al-Qaeda file, what do you think they would say? I doubt they'd put the odds at anything less than 50-50.

Given this reality -- the near certainty that another truly heinous act against American citizens will be at least attempted in the next 9 months -- you would think that the Democratic Party and its like-minded allies in the press corps would grant the Bush Administration the benefit of the doubt with regards to its management of the War on Terror. Especially so when one considers the manifest competence of its efforts to date. But you would be wrong.

The press carps and whines. The Democrats parry and thrust and play politics with national security fire. Michael Kelly has an excellent column on this subject today, which I urge you to read. He's a bit more forgiving than others have been with regards to Senate Majority Leader Thomas Daschle (D-SD). Kelly dismisses Daschle as an unserious hack.

As for the press, I suppose the question is: what did you expect? And I suppose the answer is that I didn't expect that in such a short period of time the major newspapers and newsmagazines would approach the War on Terror as a "factor" in the mid-term elections, or as a platform from which to lecture us all about civil liberties or as a seminar within which we might discuss the root causes of Islamo-fascist anger or as an opportunity to debate "unliateralism" and the needs of the EU.

You don't have to go to far afield to find frivolous press commentary and reportage. Consider the following paragraph inside an otherwise straightforward news story in The Washington Post:

"Behind the business-as-usual appearance, White House aides know the truth about public opinion in wartime: The more images Americans see of body bags or bereft families, the more likely they are to question a mission. There has been no decline in public tolerance for losses so far, and Bush is eager to keep it that way."

Consider the various conceits. First is the conceit that the author has any idea what is going on behind the scenes at the national security command post that is the White House. I can say (as can you) with virtual certainty that he has no idea what's going on behind-the-scenes in Ms. Rice's office or Director Tenet's office of Paul Wolfowitz's office or anyone else's office where the most serious matters of national security are discussed.

As for White House aides knowing "the truth" about body bags on television, I have no doubt that there are some on the White House staff who worry about such things, but so what? Does anyone think that President Bush turns to Secretaries Rumsfeld and Powell and says, "we can't attack those A-Q forces in eastern Afghanistan because there might be body bags on television.."? Does anyone think that Mssrs. Rumsfeld and Wolfowitz and Powell and Ms. Rice would work for a man who even thought that way? Does the press really think that these extraordinary public officials, who have now devoted their lives to this War, are so shallow that their real, "behind-the-scenes" concern is how it all looks on television?

And who says that the more body bags there are on television, the more queasy the public becomes? Was that true in World War II? No. It certainly wasn't true in Vietnam. The public's response to body bags on television during the Vietnam War was increased support for wider, more ferocious warfare against the Viet Cong and the North Vietnamese. Most Americans believe that if you are going to fight a war, then fight it with every weapon at your disposal. Richard Nixon and George Wallace received 57 percent of the total vote in 1968 and not because they were anti-war. Richard Nixon, running against the explicitly anti-war candidate George McGovern in 1972, was re-elected by the largest landslide in modern American history. Nearly one-third of all Americans today believe we should use nuclear weaponry in the War against terror.

What is this Washington Post correspondent talking about? America, once provoked, is a warrior nation. And once engaged, we are spectacularly good at it. We do not shirk the responsibility. We understand what it implies. The body bags on television are a given; the cost of freedom. The cost of no body bags on television -- inaction -- is incalculably higher. The country, especially WalMart America, solidly supports President Bush's War on Terror. The only thing that will crack that support is if the country concludes that he is not waging the War vigorously enough.

If I were in Tom Daschle's shoes, I would make it my business to add "software" to President Bush's "hardware," for the simple reason that it would be helpful to the War effort and would therefore be good politics as well. There are any number of "software" initiatives that are at least worthy of consideration, if not implementation. One is organizing the Iraqi opposition to Sadam. Another is organizing the Iranian opposition to the mullahs. Another is figuring out how to get the US fundamentalist community more active in certain African nations (on humanitarian missions of mercy). And the list goes on and on.

Instead, Daschle whines that he is somehow out of the loop. Senator Robert Byrd (D-WV) bloviates about the Defense Budget request being too high. Senator Joe Biden (D-DE) tries to position himself for left/liberal Democratic presidential primary voters by back-handedly sniping at the scope and strategic outline of the War on Terror. Meanwhile, the press sneers at Attorney General Ashcroft, moans that al-Qaeda prisoners in Cuba are being "mistreated," complains that Bush has no respect for the First Amendment and on (and on) it goes.

I suppose Michael Kelly's dismissive verdict -- that Daschle and company are simply unserious -- is right. But at some level it's worse than that; a kind of denial. It's as if they still believe that what's important is their spin for or on the next news cycle. Instead of the news itself and what it implies.

The Atlantic Monthly

The Atlantic continues to improve under the Michael Kelly regime. This month's issue has a strong Christopher Hitchens piece on Churchill revisionism and a funny one-pager by Walter Mead about the opposing world views of Jacksonian Americans and European sophisticates. The James Fallows piece on the role of the US Air Force in the Afghan theater of the War on Terrorism is also well worth reading. You can link to the site by clicking here, but for some reason Kelly doesn't post the latest issue of the magazine on the Atlantic website until a while after the hard copies have been mailed to subscribers.

Carli's Going to Win

Institutional Shareholder Services yesterday recommended that Hewlett-Packard shareholders vote in favor of the company's proposed merger with Compaq. As has been widely reported, this is a big win for H-P's embattled chief executive officer, Carli Fiorina. It now appears likely that the proposed merger will win shareholder approval and that HPCompaq will be born.

Opposition to the deal from Hewlett family members strikes me as short-sighted. Yes, the PC, server and mainframe businesses are all low-growth, low-margin businesses. Yes, it is impossible to raise prices on these products. Yes, H-P "owns" the "printer" business and would be well-advised to continue to build upon that point of competitive advantage.

But the future of IBM and HP/Compaq is computer services and bioinformatics. By combining HP and Compaq, Fiorini is creating a company that can at least compete with IBM's computer services and, potentially, beat IBM's Life Sciences computing division. Compaq, after all, was the computing power behind Celera's decoding of the human genome. H-P offers its own first-rate bioinformatics computing capability. Combining the two creates a powerhouse, the leading bioinformatics computing company in the world.

The problem is that bioinformatics computing (as a business) is (a) short-term risky and (b) very expensive. It is unlikely that the genomics sector will deliver much return in the near future, but it seems to me inarguable that it will deliver huge returns in the future. Being one of the two or three bioinformatics computing companies capable of handling, sorting and making sense of vast amounts of genetic data is, medium and long term, strategically sound.

This is what Ms. Fiorini is proposing to do. By combining H-P and Compaq, she hopes to rationalize and maximize the strength of the existing businesses and capitalize on the capabilities of both companies in the medium-term future. It's a smart strategy and one worthy of a "yes" vote in favor of the proposed merger.

Dowd Dead On

Maureen Dowd's column today on Ad-land is excellent and exactly right. Advertisers and marketers are still wedded to an idea of branding that says get 'em early and they'll stay brand loyal for life. Thus they advertise what teen-agers call "brown soda" to teen-agers who don't like, don't drink and don't want "brown soda." And they never will.

The best line in the column is this: "Advertisers, as Fred Brock wrote in The Times, 'have become a bunch of anti-Willie Suttons, aiming where the money increasingly isn't.'" Bulls-eye.

The Only Condit Item Ever On This Site

Speaking of pathetic, which we were in the item that follows this one, Rep. Gary Condit got roughly 20,000 votes in yesterday's primary balloting. He lost to a former aide in a landslide. This is good news for Democrats, who (obviously) would like to hold onto this Central Valley Congressional District seat that President George W. Bush carried in 2000 by a 53%-to-44% margin.

I'm impressed by the completeness of Condit's collapse. In the 2000 primary election, Condit received 80,000 votes. This year he barely mustered 20,000 votes. That isn't the bottom falling out. That's the bottom falling out and the roof caving in and the walls crashing down all at once.

Electability

The worst argument any politician can ever make in a primary election is that he or she is more "electable" than his or her opponent(s). It sends voters the one signal they don't want to hear, which is that the candidate cares more about winning than he (or she) does about them (and their concerns).

Electability was exactly the argument that former Los Angeles Mayor Richard Riordan made throughout most of the Republican gubernatorial primary campaign in California and, unsurprisingly, he paid the price. In yesterday's voting, with 100 percent of the precincts reporting, Mr. Riordan received 31% of the vote. Put another way, roughly 70% of California Republican primary voters voted for someone else. On these numbers alone, one can see the outlines of a strong case for campaign consultancy malpractice.

The excuse for this dreadful, pathetic performance being proffered by those consultants (on background, of course, no names please) is that California Governor Gray Davis skewed the results with a $10 million negative advertising attack on Mr. Riordan. And it is certainly true that Governor Davis did just that. But that doesn't even begin to explain how Riordan lost everywhere; every county, every city, every town, every hamlet, maybe every precinct (if you pit his 31% against the field's 69%).

Ordinarily, the loss of yet another fool running on electability would be no loss. But Mr. Riordan is no fool. He did a terrific job as Mayor of Los Angeles. He had a very successful career in business. He might well have been a great governor of California. The good news is that he is now free to serve in the Bush Administration. One hopes he does.

I'm a fan of Bill Simon, who is now the California Republican gubernatorial nominee. Somewhere down the road, after I return from a Fast Company reporting swing in California, I'll write up an analysis of the general election campaign. Davis is obviously the favorite, but I don't think his corner office seat is as safe as some of have suggested.

Koppel

The contract negotiations continue today with Nightline Anchorman Ted Koppel's polite response to Disney management, conveniently published by the op-ed page of The New York Times. Koppel reportedly has two years remaining on his contract, so with $20 million in play (Koppel's annual salary is $10 million), he chose his words very carefully.

It's important (from Koppel's point of view) that $10 million annually be the starting point when the negotiations with the cable news networks begin. The obvious landing zone for Koppel is CNN, which has a global news team and like-minded management in Walter Isaacson. And Koppel would be a huge catch for CNN, since Nightline has a very strong constituency (especially in cable news ratings terms) and real brand value.

But I'm reasonably certain his agent is saying: "let's talk to everyone." From Roger Ailes's point of view, Koppel offers both risks and rewards. From NBC/MSNBC's point of view, Koppel makes all kinds of sense if one assumes that a package of both cable and broadcast can be pieced together that meets Koppel's ego needs (Koppel has the traditional broadcaster's disdain for cable news). The perfect fit, actually, would be the BBC. But they have almost no distribution in the US and it's unlikely, to say the very least, that Koppel would be interested in appearing on a network which few in the US watched.

Two things killed Nightline; time-shifting and demographics. Time-shifting was enabled by the cable news networks and the Internet; we could get news at our convenience, any hour of the day or night. But the demographic shift was the killer. Sometime in 1999, the size of the echo-boom generation exceeded the size of the baby-boom generation. All those children born relatively late in the lives of their parents created a much earlier-to-rise, earlier-to-bed routine.

Back in my NBC Election Unit days, I attended a "retirement" party for David Brinkley. That's what they called it, even though Brinkley had signed on with ABC News. Shortly thereafter, Roone Arledge created a nearly perfect vehicle for Mr. Brinkley, who went on to enjoy great success for many years on ABC's Sunday morning broadcast "This Week." One hopes Mr. Koppel has similar luck. I'm not keen on his politics, but he has produced high quality work over a long period of time. And the more of that the better.

A Great Thing

If you live in the New York City area and you're looking for something to do next Monday night, you might want to get yourself to a spot where you have a view of Lower Manhattan. Beginning March 11 (and ending April 11), the "Tribute of Light" will illuminate the lower Manhattan skyline. For details, click here.

Transformation

Transformation is the big Pentagon buzzword these days and under the direction of Secretary Rumsfeld and Deputy Secretary Wolfowitz, said transformation has begun. But what does it mean? Mr. Wolfowitz gave a cogent speech on this very subject last month and you can read it by clicking here.

Jacksonians

The estimable Amity Shlaes has a good piece today in the FT about how Jacksonians shape US foreign policy and, specifically, how they view the war on terrror. People who have read this blog from the start know that I am a fan of Walter Russell Mead's book on this subject. Shlaes talked at length with Mead before writing the piece.

Neither a Borrower or a Lender be

Michael Thomas, author of the Midaswatch blog, points his readers to a good piece by Jonathan Yardley on the Doris Kearns Goodwin plagiarism brouhaha. Yardley notes that Goodwin has endeavored mightly to change the terms of her offense from plagiarism to "borrowing," and has been somewhat sucessful. Needless to say, Yardley doesn't buy it.

Wolfowitz Raw

Deputy Secretary of Defense Paul Wolfowitz is both candid and tough in this interview with the San Francisco Chronicle. The interviewer, Robert Collier, asks a lot of pointed questions. It's long, but worth reading.

No Good Deed Goes Unpunished

Jim Cramer, the former hedge fund manager and founder of TheStreet.com (and New York Magazine columnist and TV talk show host), got body-slammed this weekend by a former employee who charged that Cramer was more than familiar with the Wall Street practice known as the "pump and dump." The "pump and dump," as noted eslewhere in this blog, involves someone (usually a trader) saying "buy GE," while he (or she) is selling every GE share in his (or her) possession. Back in the mid-1990s, the SEC investigated Cramer for exactly this reason (Cramer was cleared of the charges).

There is no way to know whether these new charges are true (I doubt it). But the former employee's "revelation" reminds us that no good deed goes unpunished. Following is an email from a friend who actually took the time to read the book:

I read the Cramer book book last night - not exactly Moby Dick - and here's the deal. The writer grew up in Cambridge Mass and the Peretzes (Martin Peretz is the owner of The New Republic and a former business partner of Cramer's) were his parents' best friends. They are professors. He got out of college with a degree in comp lit and Marty got him a job in 1994 with Cramer's hedge fund. News flash: Cramer was difficult to work for. He screamed a lot. He used bad words. He threw things at people. He's....insane. But the writer was making a quarter of a million bucks three years out of college so he stayed a few years. Then he left because his boss was a mean man. That's it.

What a weasel.

More Wi-Fi

Good John Markoff piece today in The New York Times. There are basically two ways to build out a wireless 3G network (capable of supporting everything from voice to your Blackberry/Palm to you car's "wireless cabin" to your home and mobile Internet devices). The first way is to depend on major service providers, like Verizon and Cingular and Sprint and AT&T, to build third generation (3G) networks from the top down.

This way is fine if (a) spectrum is free and (b) these companies are committed to doing it. Spectrum is free in Japan and South Korea, so all the investment dollars there were targeted at building out the 3G network. And guess what. Japan and South Korea are way, way ahead of the United States in 3G wireless (a gap that will continue to grow).

Spectrum was not free in Europe and so all the investment dollars went into the auctions, which, when the markets reversed course, led to a slew of bankruptcies and now a massive consolidation and rationalization of the EU wireless business. Spectrum hasn't even been put up for bid in the United States (which is a good thing, since an insanely expensive spectrum auction three years ago -- during the dot.com craze -- would have resulted in a complete telecom sector collapse. As it is, the sector is holding on for dear life). But when the US spectrum auction is held, premium prices will still be paid, because what there is of it is limited and the military wants more. And that means less investment dollars for the actual build-out of the 3G network or very high prices for 3G services (which is impractical, since consumers don't seem particularly enthusiastic about those services).

The other way to build out the wireless network is from the ground up and this is what Markoff writes up today. The shorthand name for this is wireless fidelity of "wi-fi." And wi-fi has all sorts of potential as a low-cost, high performance substitute. A couple of days ago on this site, I expressed surprise that the major utility companies had not adopted wi-fi as their next-generation product offering. Shortly after that item was posted, a friend called me up to tell me that I was a complete fool. "They'll never do that," he said. "It would be like asking a fish to fly. It's not in their DNA."

"But," he continued, "the people who could do it and just might do it are the munis." And this is true. Munis are municipally-owned utility companies. They exist all over the country and are charged with the responsibility of delivering electric power (and water and other things) to residential and commercial customers inside their boundaries. Munis are strong political players and generate a lotof free cash flow. And in order to survive the great consolidation/deregulation of the power business, they must find new product offerings. Wi-fi fits them perfectly.

As Markoff points out, wi-fi is currently constrained by the limited reach of its enthusiasts. But if those enthusiasts and the companies that stand to gain from the wi-fi revolution can convince the munis to join up, then you would have a ground-up force with lots of investment capital. And once the munis got rolling with wi-fi, the major utilities (the Edisons, basically) would follow. And then you really could build out a national wi-fi network in a very short period of time. Which is what we need, sooner rather than later.

Addendum: To read my Fast Company column about wireless fidelity and 3G, click here.

Fund Managers and Inflated Stock Prices

Jim Grant's piece today on the dynamics of share price inflation is well worth reading. If you're job is to run a mutual fund, your job is to own stocks, even when owning those stocks no longer makes sense (in terms of potential upside). Too many buyers chasing too few "good" company stocks equals share price inflation. Which, Grant argues, is where we are at today. Thanks to reader Michael H. for the heads up.

Men Behaving Badly

I'm a Verizon DSL customer and, on balance, a happy one. The service works very well most of the time, providing our family with high-speed access to the Internet. It's not as fast as a T1 line, but it's about $950 a month cheaper. From Verizon's point of view, providing this household with high-speed Internet access for $49.95-a-month is almost certainly a money-losing proposition, but it's a great loss leader because with our DSL line comes local and long-distance telephony. And that is, I can assure you, a mini-ATM for Verizon shareholders (which is one reason we own Verizon stock).

Recently, the House of Representatives passed legislation that makes it easier for the Regional Bell Operating Companies (like Verizon) to dominate high-speed Internet access. This legislation will probably die a much-deserved death in the Senate, but the larger point is that the bill is completely unnecessary. And here's why.

Consider our home. We have two telephone lines (one for voice, one for fax), DSL service and DirectTV. We also have two mobile phones. The cost of the mobile phones is $39.95 each. The cost of the two phone lines (including all long distance and local charges) is about $110 per month. In another year (so they say), our mobile phones will likely provide us with crystal clear voice communications, even in the basement. So we can save $110 per month by getting rid of Verizon local and long distance. We could save that money now, except the reception on our mobile phones isn't quite good enough.

But what really keeps us tethered to Verizon local and long distance is the DSL line. It's there, it's right next to the computer, which is right next to the phone, which is really a base station for a bunch of cordless phones around the house. The reception is great, the speaker phone works perfectly, I'm listening to my messages right now as I type this item. The truth is we probably won't "go wireless" as long as we have DSL. If you look at the households that have DSL, virtually every one of them continues with local and long-distance land-line telephone service.

So who needs legislation that enables the RBOCs to ramp up the build-out of DSL (without meddlesome competition), when protection of two of their most important revenue streams (local and long distance) all but requires that they build out DSL as fast as they can do it? Thomas Weber, "E-World" columnist for The Wall Street Journal, has an excellent piece today on this and other legislative meddling with regards to the Internet and information technology sectors. After making hash of the RBOC arguments with regards to DSL, Weber slams Sen. Fritz Hollings (D-SC) for pandering to the Entertainment Industry with the "notion that computer makers should be required to build copy-protection technology into all PCs, lest Hollywood find itself Napsterized." (emphasis added). The important point Weber makes is that the Internet/information technology sectors have done very well by their customers without a lot of government regulation and interference. Fritz Hollings and Tauzin-Dingell will make things worse, not better.

PS: Those seeking more information on Hollings and the Entertainment Industry should check out Instapundit, who has been all over what he calls "Hollingsgate" from the git-go.

Page Six Sigma

Richard Johnson, call your office. The Wall Street Journal reports today that the editor of The Harvard Business Review is under fire for allegedly having a "romantic relationship" with former GE Chairman and Chief Executive Officer Jack Welch. Here are the first few paragraphs from the story:

There's a staff mutiny afoot at the vaunted Harvard Business Review.

Four top Review editors have written letters to the editorial director of Harvard Business School's publishing operation, seeking the resignation of their boss, Editor Suzy Wetlaufer. Citing perceived ethical breaches by Ms. Wetlaufer, some of the letter writers said she had lost the confidence of a majority of the magazine's top editors.

The revolt was catalyzed by an aborted article by Ms. Wetlaufer, in which she interviewed former General Electric Co. Chairman Jack Welch. In late December, after the article was in its final editing stages, Ms. Wetlaufer called her boss, Walter Kiechel, editorial director for Harvard Business School Publishing, to recommend that it be scrapped, according to people familiar with the situation.

The reason Ms. Wetlaufer gave was that she "had become too close to Jack" to avoid the appearance that the article wouldn't be objective, these people say. Several weeks before the story was pulled, Ms. Wetlaufer told at least three Review staffers that she and Mr. Welch were having a romantic relationship, people familiar with the conversations say.

The Harvard Business Review has long been a stage set for office coups and intrigue. But this may well be the first time HBR becomes fodder for the tabs and Entertainment Tonight. Larry Summers, call your office.

Loose Nukes

"It's going to be worse, and a lot of people are going to die," warns a U.S. counterterrorism official. "I don't think there's a damn thing we're going to be able to do about it." This, it seems to me, is the relevant quote from the Time magazine story that kicks off the new week.

What makes the Time report on loose nukes credible? According to a bipartisan nuclear non-proliferation task force report:

Such threats are not hypothetical. Consider the following:

• In late 1998, conspirators at a Ministry of Atomic Energy (MinAtom) facility in Chelyabinsk were caught attempting to steal fissile material of a quantity just short of that needed for one nuclear device. The head of MinAtom’s nuclear material accounting confirmed the attempted theft and warned that, had the attempt been successful, it would have caused “significant damage to the Russian State.”

• Early in 1998, the mayor of Krasnoyarsk-45, a closed Russian “nuclear city” that stores enough HEU for hundreds of nuclear weapons, wrote to Krasnoyarsk Governor Alexander Lebed warning that a social explosion in his city was unavoidable unless urgent action was taken. Nuclear scientists and other workers in the city remained unpaid for several months, and basic medical supplies could not be purchased. General Lebed, a former National Security Advisor to President Yeltsin, had earlier proposed to Moscow that his region take responsibility for the nuclear forces and facilities on its territory, pay salaries for these military officers and atomic workers, and take command of the structures. The Russian Government has never agreed to the proposal.

• In December 1998, an employee at Russia’s premier nuclear weapons laboratory in Sarov (formerly Arzamas-16) was arrested for espionage and charged with attempting to sell documents on nuclear weapons designs to agents of Iraq and Afghanistan for $3 million. The regional head of the Federal Security Bureau, when reporting the case, confirmed that this was not the first case of nuclear theft at Sarov and explained that such thefts were the result of the “very difficult financial position” of workers at such defense enterprises.

• In January 2000, Federal Security Bureau agents arrested four sailors at the nuclear submarine base in Vilyuchinsk-3 on the Kamchatka Peninsula with a stash of precious metals and radioactive material they had stolen from an armored safe in their nuclear submarine. After the sailors’ arrest, investigators discovered at their homes additional stashes of stolen radioactive material and submarine components containing gold, platinum, silver, and palladium.

These are a sample of dozens of actual incidents. Imagine if such material were successfully stolen and sold to a terrorist like Osama bin Laden, who reportedly masterminded the bombings of the U.S. embassies in Kenya and Tanzania and is the chief suspect in the recent attack on the U.S. destroyer Cole.

Indeed. The best thumbnail sketch of the nuclear non-proliferation crisis was written by Graham Allison, a former Pentagon official, for The Economist last fall, shortly after the September 11 attacks. Unfortunately, it costs $2.95 if you are not a subscriber to the magazine or to Economist.com. It is well worth reading and basically conforms with the view of the Nuclear Non-proliferation Task Force. Which is this:

“....the most urgent unmet national security threat to the United States today is the danger that weapons of mass destruction or weapons-useable material in Russia could be stolen, sold to terrorists or hostile nation states, and used against American troops abroad or citizens at home.”

Old Friend, New Blogger

Michael Thomas, who writes the excellent "Midas Watch" column for The New York Observer, has joined the bloggers. For a while, in 2001, Thomas wrote an equally excellent "Bush Watch" column, but for some reason it was abandoned. Anyway, blog-miners interested in smart commentary about business, politics and culture should bookmark the Midaswatch site. Thomas is as good as they get.