One factor that might be useful is to give her something that will be useful to what she does. If she works with an office suite, teach her how to use things like fields, macros, or excel's functions. If she works with email, a simple subset of renderable HTML (later with scripting) would be a nice second step. I learned most of what I know about variables working with excell (treating cells as variables (and later using simple VB scripts) and all of my html here. She doesn't need to become an assembly hacker, start at what you would consider to be well beneath you and let her work up from there.
Re:Spinning off strengths was once in vogue
on
The 3Com Saga
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· Score: 1
Spinning stuff is largely always en vogue (it was huge in the 80s, both Wall St and Pretty Woman involved spinoffs. The idea is that if you have two divisions (in 3Com's case a stable profitable networking business and an unprofitable (but potentially world changing handheld business). The rapidly growing business is undervalued when held by the parent company. The math folk who look at lots of numbers estimate the average conglomerate discount to be about 10%-15%. Part of this is that the company requires twice as much work to understand, part is concern that management may be miss managing one part, part is that your company doesn't attract pure income or growth investors (who want the exact opposite) separating resolves these issues, and the only cost is to management's ego, and potentially their pay (manager's usually get paid more for managing a bigger company.
Re:Very few corporations last long term
on
The 3Com Saga
·
· Score: 1
I think that's span in the S&P, not total lifespan. Most companies don't make it to the S&P 500 until they have been in business for a decent amount of time. You usually need a market cap in excess of $5 billion and to be in either a sexy industry (biotech now), a leader in an underrepresented inustry, or in have a compeitor get acquired. You should also have a somewhat decent history of profits, and relatively low leverage ratios. Sun can hold out on their cash horde (with small losses that by and large don't impact cash for a long time) basically forever, S&P will probably give them the boot in 3-5 years of further loss generation (a committee decides what to keep/kick) it's not based on any quantatative measures. Use SGI as a comparison S&P waited until SGI's market cap had fallen to well under $1 billion before removing them from the index. Fujitsu (or Toshiba, I don't remember which makes their own sparc stuff) might pick SUN up but I can't see anyone else doing it.
The palm saga is prety interesting as well. After 3Com sold ~20% of Palm in an IPO the total value of the 80% they retained was significantly higher value than the whole of 3Com's value. It would be like only giving MS a total value of $40 billion when they have $50 billion in the bank. As I recall they gave the rest of the shares to then current 3Com shareholders. So any measure of 3Com's value should adjust for the palm spinoff (either by reducing older values or adding Palm to the business.
I'd give them a bs list of tasks in excel (I work in finance) and the test would be if you use the keyboard for them or the mouse. People who use the keyboard in spreadsheets for things like cell navigation, copy paste and other repetative tasks. Perhaps you could do the same with a command line vs GUI, I don't know if this is quite the same, as excell (the productivity increases by an order of magnitude if you understand the ctrl seeks and 5 basic keyboard shortcuts (cut, copy, paste, fill down, and fill right). Another test might be to throw them in a new environment (vi vs emacs vs Visual Studio, or something else) (I'd see if they could quickly adjust to a different office suite/spreadsheet). Good candidates should be uncomfortable, but able to function.
The Economist is far to logical and untrendy to be fully expose you to the management mindset, go for BusinessWeek and the HBR. Not that you shouldn't read the economist, but they tend to step back from trends and look at the big picture a whole lot better than the other two magazines.
We at/.ers are still adjusting to the strange new creatures who have recently entered the site. I haven't read the original book, but I have read several exerpts and summaries of it, and combined with what I've seen of the business world you described managment's sorry state quite well. It seems like IT is a resource (nothing more or less) that can be combined with most businesses to make them more effective. I don't think that many people will argue that much of Wal~Mart or Dell's success can be attributed to anything other than useful IT deployment. However, most of their competitors just look at what the IT leader has done/is doing and try to buy the same IT systems (Siebel CRM, Oracle DB, PCs on every desk) with little thought about the ways the competitor is using the IT. In a silly example, it would be similar to FedEx watching UPS complete a hypothetical transition to biodeisel and deciding that they must do that as well but not look into how biodiesel is different from gasoline and adjust their infastructure or operations. The implimentation will fail but biodiesel will be blamed not the lack of planning or research. It sounds silly in that case, but look at the effort HP and compaq before took to try to sell computers over the internet without looking at all the other things dell does better than them. For many years they didn't sell custom built PCs it was just the same models you got in the store at the same MSRP, but this way they could tell their shareholders they were pursuing a direct solution (and later report back that the direct solution was not the HP way). It reminds me of the 1980s the GM chairman blamed his market losses to Japanese automakers on a lack of robots, so GM spent billions on automating their factories and continued to lose market share trying to sell crappy cars people didn't want (now built with robots!)
Credit cards have generally been Prime plus n% where n is based on your credit risk and usually between 9% and 15% (after that they start making you prepay the credit card or just won't give you one). In the 80s prime was a whole lot higher than it is now. Also compounding periods smaller than todays (daily rate) don't add too much to the effective interest rate 18% APR is effectively 19.56% compounded mounthly, 19.71% compounded daily and 19.72% compounded both hourly and minutely. The biblical axiom is true, the borrower is servant to the lender. Your grandma and older adivice are generally correct stay out of debt, the only exception would be if you can finance an income producing asset with debt (that returns more than the debt) it is ok (not great, but ok) to take on debt. Another axiom is true lots of good ideas have failed but no one who was not leveraged ever lost their shirt due to that failure.
That being said, I don't think I could enter the credit card business (or worse the paycheck advance business they make loan sharks look generous).
That reminds me of the exact time I realized that Linux would overtake MS. It was while reading an article the Economist published a few years ago that profiled something related to Linux. Their summary conclusion was it's small but we wouldn't bet against it as this is the same method that scientists have been using for the last few centries.
Cartel's technically restrict output to drive up prices. OPEC did learn their lesson, but there isn't any spare capacity to add to production (Saudi Arabia is the only country that isn't pumping at capacity right now). Also, over the last 20 years the ability for OPEC to exert control over the oil market has fallen with their share, it's mostly now that most OPEC nations have the lowest production costs that gives them any pricing power. Chinese demand (and the US recovery) ramped up demand much faster than producers expected. Assuming they can increase capacity OPEC appears to be targeting about $30/barrel, but pricing in dollars and the dollar's current weakness may have tweaked that more than expected. Whether or not we repeat the 80s depends almost entirely on the abilty of China to slow growth to a reasonable level, if they have a recesion expect oil to be in the teens, if they don't or something big gets blown up in the Middle East, we could be in for $40-$50 oil for some time.
They call them the i series now. z is the old system 390 (mainframe stuff), p is the AIX on power stuff, and x is the x86 stuff. e series is something else the I've never figured out. What ever the secret sauce is that makes the AS/400 line tick must be good, because they cost a whole lot more than a comparable p series system, but most users I've spoken with love 'em. /still wants an intellistation.
They eat a loss when they sell one, but each additional unit is one more in the installed base that can be used to woo developers to make new games (which should eventually make MS money). The first generation is largely MS learning the console market and getting developers to at a minimum port their games over, which has been a pretty major success. Compare their status today to the dire predictions at launch. They will probably still be willing ot tolerate losses for the next generation (MS is pretty willing to lose money on new businesses, MSN turned its first quarterly profit last quarter) but following that the XBox begins the transition away from the PC as MS platform. They start collecting a subscription and charging developer fees to developers to run signed code.
Unh huh and then they start offering delivery of applications for a low monthly fee. You don't have to worry about patching things, the console contacts MS nightly. Your files are secure on our offsite storage, and you can shop anywhere with your passport authentication. They've stated many times they want to transition home users to subscription services, this has always been the plan. Perhaps not with the next edition, but one of the future ones will have all this and more.
$900 million in quarterly sales is not exactly low volume. I'm not sure how much of the revenue is mainframe based (they also had a good quarter due to a hardware refresh by IBM. Unit numbers are not disclosed in the press releases (you gotta pay for the details) but unit growth was just behind revenue growth, which is backward from other markets where prices usually decline, they've been ramping for several quarters in linux servers. I think windows servers (or perhaps the whole x86 market is about $4 billion/quarter.
I see where you are going, and agree with you that this could potentially attract simplton wackos who want to bring about the death penalty for jaywalking. The first complaint I had about his article was that $50 billion in damages from worms was much too high. FWIW, I think his bigger point was to get us all to think about what things we let the government do and what we should do ourselves not to start executing virus writers. Lansburg would likely say we have far too much government (Like most Chicago school economists he is quite the libertarian). The only nit I have is to wonder why it's ok to use simplified models in engineering but not economics. There is no way to discribe all the factors that people use, but econometrics only keeps getting used because their models predict human behavior quite well. Although the punishments dreampt up for the Buffalo spammer make capital punishment look pretty attractive in the criminal's perspective.
You mean they don't really have wings?
In all seriousness I never connected Buffalo, NY with Buffalo wings. I just thought they were bigger than chicken wings (due to all the breading). Now it makes sense. I'd want a bunch of cayanne pepper before trying to brave a Bills game in November, although this seems a bit like the disproven logic that since brandy makes you feel warm it is a good idea for hypothermia victims.
The health insurance problem was set in motion by labor price controls in WWII. Employers found that benefits weren't covered by the price control so they began to offer health insurance as a way to skirt the controls. After WWII they continued to offer this benefit due to a tax break (heath care costs could be withheld pre-tax). As a result people don't face a direct (or even indirect in many cases) cost associated with their consumption. As anyone who has studied econ (as you have) or been to a buffet (as I have) knows that goods without direct costs results in more consumption. Leading to our current adverse selection problem. In addition to legal reform (simply taking the lawyers incentive out of punative damages would be a good start). I'd like to see the rules change to allow a high deductable catestrophic ($500 or $1000 deductable) policy remain pre tax and go back to cash and carry for most (sub $500) requirements. That's how most people handle auto insurance and it works fairly well there. If someone does not wish to have a $500 deductable let them cover the difference in cost between a $100 deductable and a $500 deductable. I have no good ideas for long term scripts (perhaps let a year's worth of drugs measure up to the deductable).
It's actually written by a reinsurance company (insuance for insurance companies wierd huh) to insurance companies (it's customers) and it outlines risks they percieve their customers begin to think about or their reinsurance policies might leave them holding the bag.
We had a farmer who got tired of unflattening his mail box so he put two up and the one of the right was filled with concrete. I guess he innoculated himself from kids with bats, at least after the first broken arm.
His measure of worth isn't based on contribution to society, it's based on what value you place on things that reduce your risk of dying. Obviously that is arrayed across a spectrum of answers (from risk seeking people who will pay for the thrill associated with a chance of death) to risk averse people who will pay (or not accept) signficant amounts for a very small reduction (increase) of the risk in an activity. The risk seeking person could be Larry Ellison (who has contributed enough to society to make himself and others very weathly) and the risk averse person could be a grandmother in Bronx who never made more than 5.15/hr in her life. His point is that the reason we assign rights to the government is to transact for all of us in places such as this where it is ineffective to conduct transactions ourselves. In his view (as well as my own) the only decisions that government should be making are those that we as individuals have assigned to them to negotiate for us as a group. The value you place on your life (in actions not just words) is what it is worth both to you and society regardless of how much money you have made or what you have contributed to society.
Unfortunatly you could lock someones account down enough that the virus could do nothing unless the root password was entered and a not insignificant portion of computer users would follow the directions to install it with root privledges (if they are granted the privledges themeselves).
If you had read the article you would have noticed that blue collar women place the highest value on their lives (followed by blue collar men). White collar employees place a lower average value on their lives.
You make decisions daily that carry some potential of killing you. In these decsions you weigh the benefits and the costs and either undertake the activity or decide not to. The economists simply study the point at which people choose to undertake slightly safer activities (there is usually a cost associated with safety).
For example there is currently some risk of going to Iraq to be a caterer. A study could compare the risk of death in Iraq to the US and look at the additional salary people demand to go work in Iraq. On average it ends up being pretty close. Certainly there are risk seeking individuals (who take on shark swimming or other risky activities for the fun of it) who skew the average down and there are highly risk averse individuals who the value is too low for as well. It is important to use willingness to accept (individual takes more risk for more pay or less risk for less pay) rather than willingness to pay (individual pays to reduce risk) which is limited by an individual's assets.
Why is it wrong to place a dollar value on your life. You do a smaller calc every day when you trade your time for dollars, money if just the reference we use to trade goods (and I'm sure you would agree that more life can be considered a good).
I'm not sure I believe his (or the "experts") value of $50 billion in damages from virus/worms/spam, but it isn't an insignficant cost. There isn't a whole lot of debate any longer regarding the value of a statistical life being something between $5 and $10 million. His best point was that government is there to provide goods and services that are difficult to transact on the open market.
The other good point was what is a viral writer's potential value to society. Look at Woz, started by hacking the phone system (blue boxing) created the mac certainly reform is a better solution in some cases. Also, this brings me to a bigger arguement the difference between script kiddies and the sharper people who write the tools that allow kiddies to function. I'm not sure that killing a script kiddie would really reduce viral output signficantly but reducing the tool availibility might dampen viral output considerably.
In fair disclosure I am an economist, and got a not insignficant part of my training from Landsburg's books (wrote the micro books we used for intro and intermediate). He's one of the better econ writers and is great at making what would be a very dry topic (the studies he is indirectly refering to are filled with stats and differentials) interesting to non-economists.
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One factor that might be useful is to give her something that will be useful to what she does. If she works with an office suite, teach her how to use things like fields, macros, or excel's functions. If she works with email, a simple subset of renderable HTML (later with scripting) would be a nice second step. I learned most of what I know about variables working with excell (treating cells as variables (and later using simple VB scripts) and all of my html here. She doesn't need to become an assembly hacker, start at what you would consider to be well beneath you and let her work up from there.
Spinning stuff is largely always en vogue (it was huge in the 80s, both Wall St and Pretty Woman involved spinoffs. The idea is that if you have two divisions (in 3Com's case a stable profitable networking business and an unprofitable (but potentially world changing handheld business). The rapidly growing business is undervalued when held by the parent company. The math folk who look at lots of numbers estimate the average conglomerate discount to be about 10%-15%. Part of this is that the company requires twice as much work to understand, part is concern that management may be miss managing one part, part is that your company doesn't attract pure income or growth investors (who want the exact opposite) separating resolves these issues, and the only cost is to management's ego, and potentially their pay (manager's usually get paid more for managing a bigger company.
I think that's span in the S&P, not total lifespan. Most companies don't make it to the S&P 500 until they have been in business for a decent amount of time. You usually need a market cap in excess of $5 billion and to be in either a sexy industry (biotech now), a leader in an underrepresented inustry, or in have a compeitor get acquired. You should also have a somewhat decent history of profits, and relatively low leverage ratios. Sun can hold out on their cash horde (with small losses that by and large don't impact cash for a long time) basically forever, S&P will probably give them the boot in 3-5 years of further loss generation (a committee decides what to keep/kick) it's not based on any quantatative measures. Use SGI as a comparison S&P waited until SGI's market cap had fallen to well under $1 billion before removing them from the index. Fujitsu (or Toshiba, I don't remember which makes their own sparc stuff) might pick SUN up but I can't see anyone else doing it.
The palm saga is prety interesting as well. After 3Com sold ~20% of Palm in an IPO the total value of the 80% they retained was significantly higher value than the whole of 3Com's value. It would be like only giving MS a total value of $40 billion when they have $50 billion in the bank. As I recall they gave the rest of the shares to then current 3Com shareholders. So any measure of 3Com's value should adjust for the palm spinoff (either by reducing older values or adding Palm to the business.
I'd give them a bs list of tasks in excel (I work in finance) and the test would be if you use the keyboard for them or the mouse. People who use the keyboard in spreadsheets for things like cell navigation, copy paste and other repetative tasks. Perhaps you could do the same with a command line vs GUI, I don't know if this is quite the same, as excell (the productivity increases by an order of magnitude if you understand the ctrl seeks and 5 basic keyboard shortcuts (cut, copy, paste, fill down, and fill right). Another test might be to throw them in a new environment (vi vs emacs vs Visual Studio, or something else) (I'd see if they could quickly adjust to a different office suite/spreadsheet). Good candidates should be uncomfortable, but able to function.
The Economist is far to logical and untrendy to be fully expose you to the management mindset, go for BusinessWeek and the HBR. Not that you shouldn't read the economist, but they tend to step back from trends and look at the big picture a whole lot better than the other two magazines.
We at /.ers are still adjusting to the strange new creatures who have recently entered the site.
I haven't read the original book, but I have read several exerpts and summaries of it, and combined with what I've seen of the business world you described managment's sorry state quite well. It seems like IT is a resource (nothing more or less) that can be combined with most businesses to make them more effective. I don't think that many people will argue that much of Wal~Mart or Dell's success can be attributed to anything other than useful IT deployment. However, most of their competitors just look at what the IT leader has done/is doing and try to buy the same IT systems (Siebel CRM, Oracle DB, PCs on every desk) with little thought about the ways the competitor is using the IT.
In a silly example, it would be similar to FedEx watching UPS complete a hypothetical transition to biodeisel and deciding that they must do that as well but not look into how biodiesel is different from gasoline and adjust their infastructure or operations. The implimentation will fail but biodiesel will be blamed not the lack of planning or research. It sounds silly in that case, but look at the effort HP and compaq before took to try to sell computers over the internet without looking at all the other things dell does better than them. For many years they didn't sell custom built PCs it was just the same models you got in the store at the same MSRP, but this way they could tell their shareholders they were pursuing a direct solution (and later report back that the direct solution was not the HP way). It reminds me of the 1980s the GM chairman blamed his market losses to Japanese automakers on a lack of robots, so GM spent billions on automating their factories and continued to lose market share trying to sell crappy cars people didn't want (now built with robots!)
Credit cards have generally been Prime plus n% where n is based on your credit risk and usually between 9% and 15% (after that they start making you prepay the credit card or just won't give you one). In the 80s prime was a whole lot higher than it is now. Also compounding periods smaller than todays (daily rate) don't add too much to the effective interest rate 18% APR is effectively 19.56% compounded mounthly, 19.71% compounded daily and 19.72% compounded both hourly and minutely. The biblical axiom is true, the borrower is servant to the lender. Your grandma and older adivice are generally correct stay out of debt, the only exception would be if you can finance an income producing asset with debt (that returns more than the debt) it is ok (not great, but ok) to take on debt. Another axiom is true lots of good ideas have failed but no one who was not leveraged ever lost their shirt due to that failure.
That being said, I don't think I could enter the credit card business (or worse the paycheck advance business they make loan sharks look generous).
Too bad they didn't get the moran guy to protest the picketers.
That reminds me of the exact time I realized that Linux would overtake MS. It was while reading an article the Economist published a few years ago that profiled something related to Linux. Their summary conclusion was it's small but we wouldn't bet against it as this is the same method that scientists have been using for the last few centries.
Cartel's technically restrict output to drive up prices. OPEC did learn their lesson, but there isn't any spare capacity to add to production (Saudi Arabia is the only country that isn't pumping at capacity right now). Also, over the last 20 years the ability for OPEC to exert control over the oil market has fallen with their share, it's mostly now that most OPEC nations have the lowest production costs that gives them any pricing power. Chinese demand (and the US recovery) ramped up demand much faster than producers expected. Assuming they can increase capacity OPEC appears to be targeting about $30/barrel, but pricing in dollars and the dollar's current weakness may have tweaked that more than expected. Whether or not we repeat the 80s depends almost entirely on the abilty of China to slow growth to a reasonable level, if they have a recesion expect oil to be in the teens, if they don't or something big gets blown up in the Middle East, we could be in for $40-$50 oil for some time.
They call them the i series now. z is the old system 390 (mainframe stuff), p is the AIX on power stuff, and x is the x86 stuff. e series is something else the I've never figured out. What ever the secret sauce is that makes the AS/400 line tick must be good, because they cost a whole lot more than a comparable p series system, but most users I've spoken with love 'em.
/still wants an intellistation.
They eat a loss when they sell one, but each additional unit is one more in the installed base that can be used to woo developers to make new games (which should eventually make MS money). The first generation is largely MS learning the console market and getting developers to at a minimum port their games over, which has been a pretty major success. Compare their status today to the dire predictions at launch. They will probably still be willing ot tolerate losses for the next generation (MS is pretty willing to lose money on new businesses, MSN turned its first quarterly profit last quarter) but following that the XBox begins the transition away from the PC as MS platform. They start collecting a subscription and charging developer fees to developers to run signed code.
Unh huh and then they start offering delivery of applications for a low monthly fee. You don't have to worry about patching things, the console contacts MS nightly. Your files are secure on our offsite storage, and you can shop anywhere with your passport authentication. They've stated many times they want to transition home users to subscription services, this has always been the plan. Perhaps not with the next edition, but one of the future ones will have all this and more.
$900 million in quarterly sales is not exactly low volume. I'm not sure how much of the revenue is mainframe based (they also had a good quarter due to a hardware refresh by IBM. Unit numbers are not disclosed in the press releases (you gotta pay for the details) but unit growth was just behind revenue growth, which is backward from other markets where prices usually decline, they've been ramping for several quarters in linux servers. I think windows servers (or perhaps the whole x86 market is about $4 billion/quarter.
I see where you are going, and agree with you that this could potentially attract simplton wackos who want to bring about the death penalty for jaywalking. The first complaint I had about his article was that $50 billion in damages from worms was much too high. FWIW, I think his bigger point was to get us all to think about what things we let the government do and what we should do ourselves not to start executing virus writers. Lansburg would likely say we have far too much government (Like most Chicago school economists he is quite the libertarian). The only nit I have is to wonder why it's ok to use simplified models in engineering but not economics. There is no way to discribe all the factors that people use, but econometrics only keeps getting used because their models predict human behavior quite well.
Although the punishments dreampt up for the Buffalo spammer make capital punishment look pretty attractive in the criminal's perspective.
You mean they don't really have wings?
In all seriousness I never connected Buffalo, NY with Buffalo wings. I just thought they were bigger than chicken wings (due to all the breading). Now it makes sense. I'd want a bunch of cayanne pepper before trying to brave a Bills game in November, although this seems a bit like the disproven logic that since brandy makes you feel warm it is a good idea for hypothermia victims.
The health insurance problem was set in motion by labor price controls in WWII. Employers found that benefits weren't covered by the price control so they began to offer health insurance as a way to skirt the controls. After WWII they continued to offer this benefit due to a tax break (heath care costs could be withheld pre-tax). As a result people don't face a direct (or even indirect in many cases) cost associated with their consumption. As anyone who has studied econ (as you have) or been to a buffet (as I have) knows that goods without direct costs results in more consumption. Leading to our current adverse selection problem.
In addition to legal reform (simply taking the lawyers incentive out of punative damages would be a good start). I'd like to see the rules change to allow a high deductable catestrophic ($500 or $1000 deductable) policy remain pre tax and go back to cash and carry for most (sub $500) requirements. That's how most people handle auto insurance and it works fairly well there. If someone does not wish to have a $500 deductable let them cover the difference in cost between a $100 deductable and a $500 deductable. I have no good ideas for long term scripts (perhaps let a year's worth of drugs measure up to the deductable).
It's actually written by a reinsurance company (insuance for insurance companies wierd huh) to insurance companies (it's customers) and it outlines risks they percieve their customers begin to think about or their reinsurance policies might leave them holding the bag.
We had a farmer who got tired of unflattening his mail box so he put two up and the one of the right was filled with concrete. I guess he innoculated himself from kids with bats, at least after the first broken arm.
His measure of worth isn't based on contribution to society, it's based on what value you place on things that reduce your risk of dying. Obviously that is arrayed across a spectrum of answers (from risk seeking people who will pay for the thrill associated with a chance of death) to risk averse people who will pay (or not accept) signficant amounts for a very small reduction (increase) of the risk in an activity. The risk seeking person could be Larry Ellison (who has contributed enough to society to make himself and others very weathly) and the risk averse person could be a grandmother in Bronx who never made more than 5.15/hr in her life.
His point is that the reason we assign rights to the government is to transact for all of us in places such as this where it is ineffective to conduct transactions ourselves. In his view (as well as my own) the only decisions that government should be making are those that we as individuals have assigned to them to negotiate for us as a group. The value you place on your life (in actions not just words) is what it is worth both to you and society regardless of how much money you have made or what you have contributed to society.
Unfortunatly you could lock someones account down enough that the virus could do nothing unless the root password was entered and a not insignificant portion of computer users would follow the directions to install it with root privledges (if they are granted the privledges themeselves).
If you had read the article you would have noticed that blue collar women place the highest value on their lives (followed by blue collar men). White collar employees place a lower average value on their lives.
You make decisions daily that carry some potential of killing you. In these decsions you weigh the benefits and the costs and either undertake the activity or decide not to. The economists simply study the point at which people choose to undertake slightly safer activities (there is usually a cost associated with safety).
For example there is currently some risk of going to Iraq to be a caterer. A study could compare the risk of death in Iraq to the US and look at the additional salary people demand to go work in Iraq. On average it ends up being pretty close. Certainly there are risk seeking individuals (who take on shark swimming or other risky activities for the fun of it) who skew the average down and there are highly risk averse individuals who the value is too low for as well. It is important to use willingness to accept (individual takes more risk for more pay or less risk for less pay) rather than willingness to pay (individual pays to reduce risk) which is limited by an individual's assets.
Why is it wrong to place a dollar value on your life. You do a smaller calc every day when you trade your time for dollars, money if just the reference we use to trade goods (and I'm sure you would agree that more life can be considered a good).
I'm not sure I believe his (or the "experts") value of $50 billion in damages from virus/worms/spam, but it isn't an insignficant cost. There isn't a whole lot of debate any longer regarding the value of a statistical life being something between $5 and $10 million. His best point was that government is there to provide goods and services that are difficult to transact on the open market.
The other good point was what is a viral writer's potential value to society. Look at Woz, started by hacking the phone system (blue boxing) created the mac certainly reform is a better solution in some cases. Also, this brings me to a bigger arguement the difference between script kiddies and the sharper people who write the tools that allow kiddies to function. I'm not sure that killing a script kiddie would really reduce viral output signficantly but reducing the tool availibility might dampen viral output considerably.
In fair disclosure I am an economist, and got a not insignficant part of my training from Landsburg's books (wrote the micro books we used for intro and intermediate). He's one of the better econ writers and is great at making what would be a very dry topic (the studies he is indirectly refering to are filled with stats and differentials) interesting to non-economists.