Economist 3/25/15

  1. MESSENGERS are arguably the most successful smartphone apps. The ten biggest collectively boast more than 3 billion accounts. WhatsApp, the leader, has 700m. The number of WhatsApp messages sent every day now exceeds the number of standard texts. Last year it handled more than 7 trillion messages, about 1,000 per person. But there is more to messaging apps than messages. At an event that starts today in San Francisco, Facebook, which owns WhatsApp, is expected to say that it will turn another of its apps—called Messenger—into a “platform”. That means others will be able to develop software and content for it (games; hotel bookings; tickets of all sorts). Facebook is following WeChat, the leading messaging service in China, and KakaoTalk, a South Korean messenger, which are already platforms of sorts.
  2. The Hawaii Supreme Court’s 100-page ruling was a partial win for the travel companies. The court held that the sites were indeed responsible for excise taxes worth some $70m. But the state had also asked the court to hold the firms responsible for paying its hotel occupancy tax—the so-called Transient Accomodations Tax. That—in a victory for the sites—the court declined to do, and the companies’ stocks rose in the days following the ruling.The state must now refund the travel bookers a large portion of the $247m they had paid into a fund ahead of the Supreme Court’s ruling. Travellers are easy to tax. But if Expedia et al want to make a real difference, they shouldn’t just be fighting hotel taxes in court, they should be fighting them in legislatures and in the court of public opinion, too.
  3. Italy these days opera-house bosses faced with declining government funding are cutting costs wherever they can. Last autumn Rome’s opera sacked its entire chorus and orchestra, and Bari—the country’s fourth-largest opera house—simply cancelled a large chunk of its season. In Venice, by contrast, La Fenice’s chorus and orchestra are busier than ever.Venice keeps posting impressive tourism numbers, with a record 9.8m tourist nights in 2013. Each year, around a million visitors walk through La Fenice on guided tours. Mr Chiarot wants them to attend performances of operas and concerts as well. This year, then, La Fenice is staging 200 operas and orchestral concerts, up from 112 in 2009. Since the budget has remained €5m ($5.4m), La Fenice now breaks even instead of losing money.Famous though they are, Italian operas are not exactly artistically demanding fare. Mr Chiarot’s productions, while perfectly respectable, do not reach the highest standards of creativity or musicianship. That, too, is part of his strategy. Most tourists are not opera buffs, but will buy a ticket to a performance if it happens to be a convenient choice.
  4. The gap between the amount of money Americans owe and the amount the government gets is $450 billion as of 2006. The IRS reckons it can recover about $65 billion of that. The remaining $385 billion will simply line the pockets of tax dodgers.The IRS is hardly alone in its ineptitude. Plenty more egregious examples have been chronicled by the Government Accountability Office (GAO) in its annual “Government Efficiency and Effectiveness” report.Another striking idea is for Congress to prevent tax dodgers from getting new passports. The government issued about 16m passports to people in 2008, 1% of whom collectively owed more than $5.8 billion in back taxes. The GAO found that “improper payment estimates” reached nearly $125 billion during the last fiscal year—a $19 billion rise from the year before—mostly because of misplaced generosity to recipients of Medicare, Medicaid and the Earned Income Tax Credit.The GAO has few kind things to say about the government’s approach to information technology (IT), on which it plans to spend $79 billion in this fiscal year. Fragmented data storage and needless duplication have wasted billions of dollars.
  5. About 300m Chinese, or one in four, smoke every day. This proportion has remained steady in recent years; efforts to publicise the dangers have been half-hearted. This year, however, may see improvements. On June 1st stricter rules will be enforced on smoking in public places in Beijing, including bars, offices, stadiums and some outdoor areas such as those of hospitals and schools. Fines for failing to keep such places smoke-free could be as high as 10,000 yuan ($1,600); for smokers who break the rules, they could be up to 200 yuan. Cigarette advertising and tobacco-company sponsorships of events will also be banned.Chinese leaders are becoming more focused on the problem. In 2013 officials were banned from smoking in public places. President Xi Jinping’s wife is a “tobacco-control ambassador” for a government-affiliated campaign group.
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