Thursday, August 25, 2011
The Peter Principle in Technology
It seems to me that technological progress results in the use of new technology that isn't quite adequate. I can remember a remark a technician made to me years ago about telephones. The rotary dial telephone was invented ages ago - probably not long after I was born. The technician was in the process of changing one of the telephones in my house, replacing a rotary dial instrument with a push-button phone. He remarked that the rotary dial phone had been in use for such a long time that it had been perfected and very rarely malfunctioned. The new, at the time, push button phones were not nearly as dependable, but they were rapidly replacing the older rotary dial instruments.
I've thought of many other examples. The railroad was invented as an improvement on wagons pulled by horses or canal barges towed by horses. It provided more rapid transportation of heavy loads. However, early railroads had some important drawbacks. It took many decades of trying and failing to develop a reliable signal system to keep two trains from colliding. It also took decades to increase the speed from about 20 miles per hour to 100. Finally the system was just about perfected. Then came the bus. Buses could go places trains couldn't. They could offer lower cost transportation. However, they were slower and less comfortable for human passengers. Nonetheless, by about 1940 passenger rail service was declining as more and more people chose either to ride buses or to buy and drive their own cars. Clearly, these newer forms of transportation were in many respects inferior to rail travel. A few decades later, cars were more comfortable and safer, as were buses. But, before these new means of transportation had a chance to become perfected, the airplane appeared. Now we travel long distances by air. For shorter distances we drive our cars, ride buses, or use what's left of the passenger rail system.
I could extend this essay for many feet by showing other examples in which we are using new, developing technology that doesn't work as well as older technology that we've abandoned. It's like the Peter Principle in employment. In many cases we're doing things not as well as we could have with older technology.
Tuesday, August 23, 2011
My finger tips and the fipple flute
I have a slight talent for music, just a little more than the Emperor in the play "Amadeus." In high school and college I played the clarinet. I wasn't a great player, but I could play well enough to be one of the second clarinets in the college band. The band played at the week-end football games during the football season and gave concerts at other times of the year. For me it was a substitute for the required courses in military training at the Michigan land-grant college (MSU nowadays).
Later I collected three fipple flutes, also known as recorders. I have a soprano, an alto, and a tenor. Until last February I was a fairly accomplished player ot these instruments. Now, because of the callus on my right ring finger, I have difficulty fingering the second note on the scale of any of these instruments. I can manage with the alto by placing the part of my finger that's soft over the holes in the instrument. The tenor is more difficult for me. I think I can play the soprano; it's the smallest of the three.
I keep hoping that my finger will eventually reject the callus and the tip will become as flexible as the tips of the other fingers. I also keep thinking that I may have to acquire a rubber thimble for that particular finger. I have seen rubber thimbles in an office supply store, but they were too small for my finger.
The doctor who treated my wounded finger suggested that I should use hand lotion, like Lubriderm, to soften the finger tip. Apparently it is a common thing for a wounded finger to grow a callus to protect the end of the remaining bone. I haven't been using hand lotion regularly. In order to expose the finger to the lotion continuously I have to wear a throw-away kitchen glove with lotion in the one glove finger that goes around the right ring finger. I haven't been going to that much trouble. I keep hoping that the finger will eventually get tired of being different from the other fingers and reject the callus. That hasn't happened yet.
Monday, August 22, 2011
When is a Corporation a Person
The Supreme Court has decided that a corporation is a person with respect to free speech and supporting political causes. A corporation has the same rights as any other person in such matters. The Court has not yet decided that a corporation should be allowed to register as a voter and cast a ballot. In addition, corporations are not (yet) subject to various laws. A corporation can not be indicted and tried for murder it its practices endanger the lives of miners, as an example. In that respect and others, a corporation is not (yet) a person. However, with respect to doling out money to candidates, it is a person, and a very big one at that.
Congress has decided that the money that a corporation pays out in dividends to investors should not be taxed as ordinary income. Some in Congress argue that such money should not be taxed at all, because the corporation has already paid income tax on the income before paying the dividends. Now, this policy makes no sense if the corporation itself is a person. I am a person. I pay a gardener a sum of money each month for taking care of my lawn and plants. The gardener has to pay income tax on the money I provide him. It would do him no good to argue that I have already paid income tax on the money. Yet, this argument works in Congress. The argument is that since I own stock in a particular corporation, I own a share of the company and, through my ownership, I have already paid income tax on the dividend. Therefore, I shouldn't have to pay tax on the dividend. "Double taxation of dividends" is the slogan.
So, what is it? I own shares in an electric power utility in Wisconsin. Is that corporation a person - in which case my dividends should be taxable like any other ordinary income - or isn't it? I am personally opposed to granting the power company the status of personhood. I know that the political issues and candidates that the utility supports are chosen by the Board of Directors. I've never seen a proxy soliciting my choice of which Wisconsin candidate for governor or which candidate for senator I would like the firm to support. Those directors mostly are Republicans, I suspect, and their choices of candidates and issues are not mine.
Monday, August 15, 2011
Warren Buffett's article
As I say, these arguments are merely arguments of convenience. The Tea Party is funded and led by a group who simply want taxes reduced as much as possible and who want government to become as weak and ineffectual as possible. According to Gloria Steinem, interviewed by Ian Masters on Sunday on radio station KPFK, when conservatives are honest they admit that what they really want is to create a class of workers who will take menial jobs at low wages. In that way they won't have to export work to China and other low-wage countries. They don't want the government to provide free or good education for anyone. They don't want unemployed workers to enjoy the benefit of unemployment insurance. Senator Kyl of Arizona has said that unemployment insurance encourages unemployment; without the insurance, the unemployed worker would take any job available and whatever wage was offered.
We progressive liberals must keep trying to inform the public as to the real intentions of these people who put ending the deficit and paying off the national debt ahead of creating new jobs with decent wages, saving Social Security, improving Medicare, and extending unemployment benefits.
Saturday, August 13, 2011
Instead of the female voice asking questions, the next thing I heard on the telephone was the voice of Dick Morris. He was peddling a book and was talking about what a dreadful President Mr. Obama has been, about his socialistic ideas that are way out of the mainstream, about his complete mishandling of the economy, etc.
After a minute or so of Dick Morris, the female voice was back and said she would now ask me some questions. I said, "go ahead." She asked, "on a scale of 1 to 10, 1 being terrible and 10 being very good, how would you rate Obama's handling of the economy?" I thought for a few seconds. Certainly he had tried; he had recommended stimuli to the economy. He'd been hampered by Republican obstruction. I finally decided and replied, "I'd give him a 7."
The voice said, "Thank you. That's all."
I was really irritated at this moment. I said, "You have only one question for me? Is that all you're going to ask after making me spend a minute listening to that ass-hole Dick Morris?"
She said, "Thank you. Good bye." That was the end of our conversation.
I've had people, usually women, telephone me before and ask me to take part in a poll. Usually it's about the effect of advertising on certain products. However, recently I had a poll call from another conservative organization in which the first question was to name the President I considered the best. Then, name the one I considered the worst. I think the "proper" answers for these questions would be "Ronald Reagan" and "Barack Obama. My answers were "Franklin Roosevelt" and "Warren Harding." Polls of this sort are called "push polls." You, the person being polled, are "pushed" toward making the desired response.
Dick Morris didn't push me the slightest bit.
Saturday, August 06, 2011
Positive Feedback in our Economic System
I learned that a control system is stable if it has negative feedback. To illustrate the concept of feedback, consider the system for regulating the speed of a steam engine. A flyball governor is driven bu a wheel attached to the main drive shaft. The governor operates a lever that changes position if the speed of the engine changes. In a typical arrangement a speed increase causes the lever to move upward and a decrease causes it to move downward. A fixed lever represents the desired speed of the engine. Another lever is connected between the fixed, or set-point lever and the speed lever. This lever, whose position is proportional to the difference between the set-point and the actual speed of the engine, is connected to a mechanism that changes the position of the valve that admits steam to the engine. If the engine speed exceeds the set-point, the linkage causes the steam valve to move toward the closed position. The result is that the engine speed is reduced. If the engine speed is less than the set-point, the same linkage causes the valve to move toward the wide open position, with the result that the engine speed is increased.
With such a control system, whenever the load changes, the engine maintains or comes back to the desired speed. The time required to return to the desired speed depends on the gain or sensitivity of the entire system. Some control systems can very rapidly bring the engine back to the desired speed. Some control systems take some time to bring the engine back to speed.
Now let us suppose that mechanic has made a mistake and connected the parts of the control system incorrectly, such that an increase in engine speed causes the steam valve to open even wider, or a decrease in speed causes it to move toward the closed position. In one case the engine will eventually operate at such a high speed that it may fly to pieces. In the other case the engine will soon shut down completely. Such a system is said to have positive feedback.
I assert that our economic system based on independent suppliers of goods and services and governed by market forces has positive feedback and is inherently unstable. Consider the present predicament of the country. Unemployment is high – around 9 percent. Even workers with jobs are worried about lay-offs. People who do not have jobs have little money to spend. They are using what unemployment insurance they have to eke out their savings to buy as little as possible. Even employed workers are purchasing as little as possible. As a result, there is little demand for goods and services and suppliers are not hiring more workers. As the recession deepens, more workers are laid off and demand for goods and services declines. The feed-back is positive.
Now consider a situation in which there is almost full employment. Workers have money to spend. Everyone is buying goods and services and suppliers have to hire more workers to meet the demand. More workers provide still more customers, and the demand for goods and services increases. The feedback is positive.
We know what happens in each situation. The recession in one case deepens and results in a severe depression. It may take many years for the economy gradually to improve. The exuberance in the other case may lead to a speculative bubble. Certainly the increase in economic activity is limited by the total number of potential workers available. After everyone has a job, the only way to achieve greater production is by using more efficient tools and methods.
In the long run, the economy goes from a “normal” state to either extreme, stays there for a while, and then may change rapidly or slowly to the other extreme. After a peak is reached, the economy can decline rapidly into a recession. Once in recession, the economy climbs slowly back to “normal.” The resulting oscillation in the system is called the “business cycle.”
Economists and politicians have been grappling with this instability problem for centuries. One attempt at a solution that would provide negative feedback is called “Keynesian Economics.” In this approach a strong central government provides the negative feedback by providing temporary employment and unemployment benefits to laid-off workers during a recession and increases taxes on a prosperous population during a boom. The government may also impose regulations to inhibit gambling speculation that occurs during a boom or a bubble. The goal is to smooth out the extremes of the business cycle. Recessions are less severe or deep and booms are less exuberant.
There are some difficulties in implementing the Keynesian solution. The government needs extra money to provide the unemployment benefits and the temporary jobs during a recession. This money can be borrowed, preferably from wealthy individuals within the country. However, the government is required to go into debt and operate at a deficit. During a boom, the government should use extra tax revenue to pay back the debt incurred during the previous recession.
Both of these actions are politically unpopular. Members of the public resent having the government borrow money to provide benefits to unemployed workers during a recession. Such action is contrary to what they are doing. They are tightening their belts and spending less money and giving less to charity, and they think the government should be doing likewise. Also, they resent any increase in taxes, even during good times. They want to keep all their money and spend it on the good things that are available or to speculate on things that seem to be going up and up in price.
Economists and politicians each have important responsibilities. Economists have to develop models of control, like Keynesian Economics, to stabilize the world-wide economic system. Politicians have to implement those models that seem to be the best and explain to the public how the chosen model is supposed to work and why the various actions of government are necessary, even though counter-intuitive. In recent times we have not been well-served by either economists or politicians.