March 2013 – Page 2 – Chaos Manor

Fracking, The Fall of the Wall, minimum wages, dinosaur killers, and other interesting matters

By Jerry Pournelle | Mar 25, 2013 - 12:24 am | Updated: March 25, 2013 - 11:19 am | Mail

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Mail 768 Sunday, March 24, 2013

I have a huge backlog of interesting mail. I will try to group it into subjects and clean it up this week. Except that it is tax season..

In today’s View https://www.jerrypournelle.com/chaosmanor/?p=13050 we discuss fracking and natural gas flareoff.

flare off

Dr. Pournelle,

The flare off in Williston is similar to burned off gasses at almost every gas or oil well, and common to refineries, as well. They’re all over Texas, and here in West Virginia.

The oil and gas exploration was done in North Dakota and Eastern Montana beginning over 30 years ago — those farmers were getting rich selling their mineral rights in the late 70’s and early 80’s (while I was fooling around with Minuteman missiles in usually somewhat drier holes). The coal gassification and carbon sequestration that we corresponded a couple years ago was also begun at that same time. The lack of a pipeline in North Dakota is at least one reason partly given as justification for the road improvements that you were once critical of in your blog.

Reflecting, I seem to have followed the oil and gas industry around the country for 30 or 40 years without being directly involved with it. It has always my neighbors who were in it, even during my short stay between Lompoc and Santa Maria. Always the bridesmaid…

According to people I’ve spoken to, the overpressure light gas product that is burned off during the production and refining is too volatile to capture easily, and too dangerous to vent without combustion. It isn’t the commercial product that is wasted. I’ve always thought that a small steam generator could produce electricity to partly supply the sites intermittently, but there’s been none developed cheaply enough for common use.

-d

North Dakota lights

One of your readers says that the lights seen in North Dakota by satellite are from flaring. I would think that a well flare, which is essentially just a torch, would not produce enough light to be seen from space. Active well sites, however, look like small cities when the rig is lit for night drilling.

Best regards,

M Walters

There certainly is a lot of brightness across a one hundred mile stretch there in North Dakota. The important thing to note is that we have the technology and the resources to get out of this economic depression if we really want to; the fact that this effort is stalled says a lot about the state of the republic. The Framers would have left such matters to the states, and not have the federal government interfere so much. Perhaps we will rediscover some of the lost arts we once had.

In Spring of 1989 Roberta and I visited the Soviet Union for the first time. There had been a period in my career when I was forbidden from visiting the USSR, and another period when I would not have dared to, but we went with a party that included a number of others previously forbidden from going to Moscow, as well as political and journalist dignitaries, and I wasn’t worried; and indeed it was a pleasant excursion and quite enlightening. I was even honored with a formal dinner by the Soviet Academy of Sciences. Mr. Gorbachev was in power in the USSR, and he was desperately trying to thaw out the Cold Was and convert the USSR into a liberal socialist state similar to other European nations.

Many wished him well, including both me and President Reagan; indeed it had been the intention of the SDI policy to bring something like that about. The key to ending the Cold War was to allow the USSR to stand down from its mission to liberate the world in the name of communism, release the captive nations, and reduce its enormous inventory of nuclear weapons and delivery systems by running up the price of a big nuclear establishment. Mr. Reagan offered the olive branch of removing the medium range missiles from Europe and a new Strategic Arms Reduction Treaty at the same time that the US began serious funding of the Strategic Defense Initiative he proposed in his “Star Wars” speech. SDI was strongly advocated by the committee I chaired to prepare the space policy papers for the incoming Reagan administration transition team. But that’s another story. The point I am approaching was that as late as Spring of 1989 none of us thought that the Berlin Wall would fall by November of that year, and that the Soviet Union itself would come apart, freeing the captive nations of Europe not long after.

The Foreign Policy Research Institute often has good papers on both history and policy.

FOREIGN POLICY RESEARCH INSTITUTE

Dear Readers,

Taking note that on Sunday, April 7, Ignat Solzhenitsyn will conduct the Chamber Orchestra of Philadelphia in a concert commemorating the Fall of the Berlin Wall, we asked FPRI’s Ron Granieri, a historian of modern Germany, to reflect on the fall of the wall and German reunification. What he has produced — The Fall of the Berlin Wall, the Power of Individuals, and the Unpredictability of History <http://www.fpri.org/articles/2013/03/fall-berlin-wall-power-individuals-and-unpredictability-history> — is both illuminating and moving.

While this history is far from complete, it will remind older readers of things best not forgotten, and many readers may encounter much they were never taught in school. The fall of the Wall was sudden, and not anticipated by many. By 1989 Stefan Possony, who was one of the originators of SDI and one of the strategists of the protracted conflict had been disabled by a stroke. Whether he anticipated the fall of the wall is hard to tell: those of us who visited him including my son who was his godson were certain that much of the old brilliance was still in there somewhere, but the frustrations of trying to communicate often reduced him to tears. I am thankful that he lived to see the Wall come down, and the USSR dissolved. If he saw it coming he was the only one who did.

In June 1989, SPD Minister President of Lower Saxony Gerhard Schröder famously remarked: “After forty years of the Federal Republic we should not lie to a new generation in Germany about the chances of reunification. There are none.” In late July, Joschka Fischer of the Greens, future Foreign Minister, went one better, dismissing the demand for reunification as “a dangerous illusion” and called for removing the call for reunification from the preamble of West Germany’s Basic Law. Even later that fall, Fischer said “Forget about reunification; we should shut up about that for the next twenty years.”

Three months later the Wall came down, and the USSR was doomed.

Previously we discussed minimum wages. I have chosen some representative views:

minimum wage raise and consequences

I wonder about the " living wage " thing as has happened in San Francisco and elsewhere where now the minimum wage is over $ 10.00 an hour.

Of course, businesses will raise their prices to compensate for the raise in wages and the corresponding costs for paying for contributions by the employer to unemployment, social security and the like.

I do wonder why no one ever seems to mention what I think would be an obvious result of a $ 22.00 minimum wage,

Wouldn’t it cause food, energy and other costs to go way up thus raising inflation and therefore making the purchasing power of those suddenly " richer " employees even less ?

Heinlein is still right.

TANSTAAFL.

I do know that even in San Francisco which has a kind of rent control, rents continue to go up.

A studio apartment in the city’s Tenderloin ( not the best area to live in for sure ) that rented for $ 200 a month up to 1980 now rents for $ 1200 a month.

If you made $ 22.00 an hour you’d have to work 54 hours just to pay the rent.

If you make the " living wage " you’d have to work about 108 hours to pay the rent.

And that’s before deductions.

This is something the OWS types never think about.

I don’t know about the rest of the country, but here in the SF Bay Area it’s one of the most expensive places to live.

And with people having their hours cut below 30 hours a week to avoid the onerous provisions of Obamacare, it isn’t going to be any easier for lower paid workers.

george senda

Well, of course we can’t let just anyone live in the elite areas like San Francisco and Fairfax, can we? Although there must be someone to hew the wood and draw the water.

Jerry,

Note the chart here: http://www.financialsense.com/contributors/asha-bangalore/major-economic-reports-mixed-message-with-unfavorable-tone

Note the month in which the unemployment rate inflected: July 2007. The month of the second of three increases in the minimum wage enacted by the Pelosi-Reid Congress in 2006 and signed by President George W. Bush’s.

QED, and it’s only Bush’s fault because he didn’t veto their mad scheme to increase the minimum wage 41%in 24 months, which he should have. The economy absorbed the first raise (July 2006 from $5.15 to $5.85, a 14% increase) with fairly minimal effect on employment, but the second increment (July 2007, to $6.55) combined with the then-bursting housing bubble, were the (synchronized,synergistic, and with George Soros funding the Democrat Party, certainly intentional) two triggers of the current downturn. Given that unemployment remains high, another 25% increase in minimum wage (from the $7.25 reached in July 2008 to the $9.00 requested by the President) would pretty much shut the country down.

That’s a definition, not an opinion.

Jim

The following contains a short dialogue continued for some time.

More on minimum wages (possible duplicate – retrying after crash)

You covered this a bit over a year ago, and you were kind enough to print my observations on it then. (Those are at https://jerrypournelle.com/chaosmanor/?p=4295, and I worked them up into an article at http://www.spectacle.org/0112/lawrence.html).

Revisiting the topic just now, you quoted Milton Friedman once saying that every economist knows that minimum wages either have no effect or create unemployment, and that this was not an observation, it was a definition. You added that that should also be self evident.

It turns out that Milton Friedman was oversimplifying. There are exceptions which are even covered in introductory economics texts, so that that self evident thing isn’t quite true after all. By chance, I recently went into this in a blog exchange at http://statelymcdanielmanor.wordpress.com/2013/02/12/adventures-in-obamaland-the-sotu-2013-condensed-version, which I append below for convenience. The take away point is that there is often a small, sweet spot, in which a low, mandated minimum wage really does help – that is, it improves take home pay rates, numbers of workers, and all up production. The catch is that the common sense result cuts in very early, and politicians usually go for that instead of doing it right. Brad Delong reports that the consensus in the economics trade today is "… the EITC and the minimum wage have different weak points–too high a minimum wage will have a substantial disemployment effect, and too high an EITC does create incentives to pad your hours. A mixed strategy helps attenuate both these flaws."

I also noticed your follow on about Distributism. As far as I know, only some Distributists advocate getting it the way you describe, by forcible redistribution. Although some do, possibly because they see it as the fastest path to their omelette and aren’t much worried about the broken eggs involved, there are others. These more philosophical Distributists have it mind as a standard or reference to steer by and try to get to, but they are more willing to consider less destruction and force on the way there (my tax break approach to wage support might serve as one beginning, since it would actually reduce current burdens). For some Distributists, it might be enough just to get rid of the institutional support for present arrangements, if they think that generational change would do the rest fast enough for their tastes; you can see where the temptation for a quicker fix hits the rest of them.

By the way, distractions including a dying computer have kept me from emailing you feedback lately – I had to compose this off line, saving between crashes. Would you like me to catch up on feedback once I get a new computer, and if so would you prefer individual messages or a big compendium one?

That minimum wage blog exchange follows:-

<BLOCKQUOTE>

In this case, common sense need not be our guide at all, or our sole guide in any case. The history of such political hikes makes quite clear that they reduce, not increase jobs.

</BLOCKQUOTE>

Actually, the history is mixed, with any general pattern lost in the noise. Current best research suggests – no more than that, in my view – that a mandated minimum wage can be moderately helpful as part of a larger strategy that also includes other measures. Brad Delong recently went into it <A HREF="http://delong.typepad.com/sdj/2013/02/yes-thoughtful-economists-think-raising-the-minimum-wage-right-now-is-a-good-idea.html">here</A>, introducing it with "I would point out that the EITC and the minimum wage have different weak points–too high [emphasis added] a minimum wage will have a substantial disemployment effect [emphasis added], and too high an EITC does create incentives to pad your hours. A mixed strategy helps attenuate both these flaws." (My own view is that the best thing, if we start from here, is the tax break approach I discuss <A HREF="http://www.spectacle.org/0112/lawrence.html">here</A>, covered in more detail in the work of mine and of Professors Phelps and Swales that it links to.)

<BLOCKQUOTE>

Minimum wage jobs are essentially for teenagers, unskilled and inexperienced children, entering the workplace for the first time.

</BLOCKQUOTE>

No, not essentially but accidentally (in the U.S.A.). That is, it is an accident of recent U.S. circumstances. Things are different elsewhere, and more relevantly to your concerns, they are becoming different in the U.S.A., and indeed have already done so to a considerable extent.

<BLOCKQUOTE>

But as you noted, I suspect we essentially agree that now is not an appropriate time to raise the minimum wage.

</BLOCKQUOTE>

We don’t agree, because my position is subtler:-

– It would probably help a little to raise the minimum wage a little, now, because of the mechanism I will outline below.

– The actual proposals are probably for too great an increase to be constructive, because that’s what politicians usually go for.

<BLOCKQUOTE>

There is, to me, no appropriate time. It’s not the government’s business.

</BLOCKQUOTE>

Sort of. That is, the government should never have been in that game in the first place, and people’s personal resource bases should never have been destroyed over the generations. That ideal world would have been rather Distributist (google it), with people working for themselves or for others for low, free market top up wages and getting the rest of what they needed from their own private resources (if they were working for themselves, their drawings would fold both of those in together).

But it’s not like that. In the old phrase, they break your legs and give you a crutch. That creates dependency in a poison pill way: simply stopping government support just like that would leave people helpless, with just the metaphorical broken legs. So, on the principle of you break it, you bought it, it is the government’s business to provide support – only, not in the present, continuing way that perpetuates the cycle of dependency the government itself created but as part of a transition that gets us out of here (the tax break system I linked to would work as the first step of such a transition). Naturally, the government would never do that if it could help it, but it still owes it, morally speaking.

Now, as promised, for how mandated minimum wages really work out. Murray Rothbard’s <A HREF="http://lewrockwell.com/rothbard/rothbard315.html">view</A> is typical of the faulty common sense understanding. It’s basically all bullshit because he doesn’t know what he is talking about, apart from his description of the unions’ interests in all this. It only works out like that when the mandated minimum wage is too high relative to the effect of ordinary hiring on the employers’ cost patterns. But when – as often happens – the employer is a significant one in a local area, or operates nationwide but is a big presence everywhere, and the mandated minimum wage is comparatively low, other things happen that change the outcomes. I already mentioned that Lipsey’s Positive Economics explains this quite well using graphs, but as I can’t do that here I will bring it out with a pair of tables using example numbers (I hope the tables are formatted OK! please reformat them if necessary):-

<BLOCKQUOTE>

Minimum wage

Number of Wage rates Total Incremental Total Total net Marginal

employees needed wages utility ($) utility ($)value value

0 9 0 0 0

1 9 9 15 15 6 6

2 9 18 14 29 11 5

3 9 27 13 42 15 4

4 9 36 12 54 18 3

5 9 45 11 65 20 2

6 9 54 10 75 21 1

7 9 63 9 84 21 0

</BLOCKQUOTE>

With this pattern of utility that each additional employee gives to the employer, a mandated minimum wage means that the employer is best off with either 6 or 7 employees (it comes out the same).

<BLOCKQUOTE>

Varying wages

Number of Wage rates Total Incremental Total Total net Marginal

employees needed wages utility ($) utility ($)value value

0 0 0 0 0

1 1 1 15 15 14 14

2 2 4 14 29 25 11

3 3 9 13 42 33 8

4 4 16 12 54 38 5

5 5 25 11 65 40 2

6 6 36 10 75 39 -1

</BLOCKQUOTE>

With this pattern of utility that each additional employee gives to the employer, a floating wage means that the employer is best off with just 5 employees. That’s fewer than with a mandated minimum wage!

What’s going on? Well, when each additional employee is hired, the employer has to increase what he gives to all the employees he already has as well, or they would just quit and re-apply and he would have to take them (or he would have to hire yet others who knew that they could hold out for that much). So the additional cost of each additional employee is not that employee’s wages but that employee’s wages plus the extra that has to be paid to all the others together. That’s not much more each, but it’s quite a bit for all of them together, and that decreases the optimum staffing level – so, with these numbers, a mandated minimum wage gives both more employment and higher wages!

Now, this doesn’t just happen because I found numbers in some sweet spot (in fact, these are the first numbers I tried). What the graphs and equations would tell you, if you could find them, is that under quite ordinary conditions there’s always a sweet spot of some size just above the "free" market wage – because those quite ordinary conditions aren’t actually a free market but a market with employers dominant enough that their own hiring affects conditions more broadly.

Yours sincerely,

P.M.Lawrence

The question is whether find the sweet spot is worth the price of letting the government camel have his nose in the tent. Once you concede that the federal government ought to tinker with such matters you have changed the nature of the Union. I have no objection to leaving it to the States to find the sweet spot you think is almost inevitably there, and I agree that the negotiation isn’t always equal; the question is whether the cure is not worse than the disease.

I wish your computer a speedy recovery and I apologize for the delay in getting this up; things have been a bit hectic here. I always appreciate your comments.

The death of our United States

Dr. Pournelle,

I have a lot of time to think during my daily commute now, and this is something that I think I think.

Historians will look back and mark as the death throes of the United States of America, the era when the meaning of the word "Freedom" changed from explicitly guaranteed personal liberty to an ever expanding list of invented rights and entitlements that must be provided by the government and paid for by someone else.

Everyone thinks their personal favorite cause is a "right", which must be not only protected but enabled by the govt. Our rule of law is therefore perverted to give legitimacy to a chorus of demands for special treatment. This is not equality nor freedom, but is the manifestation of the tyranny of the majority warned against by our founding fathers.

There’s more to it of course, but that pretty much sums it up for me.

Sean

It used to be that discussion of “positive” and “negative” rights was part of elementary civis discussion. In the USSR, for example, there were no “rights” but there was a series of duties and regulations governing the actions of the militia and the prosecutors that was supposed to ensure rights; but there was nothing like “Congress shall make no law” commandments enforceable by an independent judiciary.

Now there is little such discussion in any classrooms at any level. The usual academic assumption is that government ought to Do Good, not prevent evil. “Negative” rights are of no use according to the usual civics instructions now.l

A remarkably honest article about Harry Dexter White.

<http://www.foreignaffairs.com/articles/138847/benn-steil/red-white?page=show>

Roland Dobbins

White and those like him were part of the fuel that drove Senator McCarthy out of bounds.

Dinosaur Killer Likely To Be A Comet Not Asteroid

http://www.bbc.co.uk/news/science-environment-21709229

In which case we can’t predict when the next one will turn up..

It is by no means certain which it was but this shifts the odds

Neil Craig

Of course we told you so…

Asteroid headed toward Earth? ‘Pray,’ NASA advises | Fox News

Jerry:

Hopefully this is a teachable moment.

http://www.foxnews.com/science/2013/03/20/asteroid-threat-earthly-budgets/?intcmp=features

We had a much bigger, not so near miss more recently. The improbability of so many near misses within such a short period of time suggests that God is trying to tell us something.

I believe that there is an error her regarding the size of near Earth objects that NASA has been tasked with detecting. Detecting objects 87 miles across should be easy while detecting objects 87 feet across is challenging. Objects smaller than 87 feet or ~ 25 meters across pose a significant danger.

Volume of 25 meter asteroid = 16,000 cubic meters.

Assumed density of a near Earth asteroid is 4

Mass of 25 meter asteroid ~ 60 million tons or 60 billion kilograms.

Impact energy at 40 kilometers per second = 5 eex19 Joules.

Equivalent to 11,000 Megatons yield.

It wouldn’t be Lucifer’s Hammer, but the scaling laws for nuclear weapons suggests that the probable lethal radius would be about 200 miles.

James Crawford=

And if we had twenty years?

But then I have :

faulty math in asteroid threat example

The Asteroid strike math is off by an order of 1000—math error ? double x meter^3 to Kilos?

11 mega ton strike not 11,000 Mega ton,

We’d never evolved if his math was correct.

Peter f Foley

It is still a formidable event…

Finally, maybe.

We know beyond a shred of doubt that portable electronic devices don’t interfere with aircraft electronics because the airlines are now putting iPads in the cockpit for use as aircraft manuals and so forth.

But we’ve known this for years, because aircraft aren’t falling from the sky.

People do not actually *turn off* their mobile phones, tablets, whatever. They simply blank/lock the screens of their devices. My guess is that maybe 1/10th of 1 percent of flyers actually truly turn off their electronic devices when traveling on airplanes.

So, given that aircraft aren’t constantly crashing, it’s pretty obvious that the claims of the airlines and the FAA are utterly without merit.

<http://www.technologytell.com/entertainment/14939/essay-electronics-devices-on-planes-is-the-madness-nearly-over/>

Roland Dobbins

It is getting obvious, isn’t it…

Almost in the same breath, I received an order from Ambassador Bremer’s office in Baghdad to cease the grain harvest and let the crops rot in the field.

———————

He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.

B

Karzai the US and the Taliban

Jerry,

Nobody ever said Karzai wasn’t crafty. By claiming an alignment between the US and the Taliban, he may be able to brand the Taliban as outside invaders and American collaborators, greatly reducing their acceptance. It isn’t about accusing the US of doing something wrong, because we are already western invaders and can’t get any lower in status. But putting the Taliban in our cultural category may be a masterful PR move. It sure won’t make us happy but it could help any non-Taliban govt quite a bit.

Sean

Actually, I hope it works.

Fracking our way back to a republic?

By Jerry Pournelle | Mar 24, 2013 - 3:28 pm | Updated: March 24, 2013 - 4:59 pm | View

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View 768 Sunday, March 24, 2013

The amazing satellite image which shows how one tiny town (pop. 14,716) has fracked enough oil and gas to light up ‘Saudi America’

http://bit.ly/ZkakPo

Lawrence

There is no real shortage of energy, and the United States does not need to keep large armies in the Middle East to have an energy surplus here. We have the technology and we have the resources. Of course this has been true for a long time, since we have alternatives to oil. Developing domestic oil resources has this advantage: it is politically possible. There are powerful lobby groups very much in favor of developing those resources. This will come out more and more, even in California where the state and local governments are desperate for more revenue: at some point they will figure out that the reason the state is broke although it sits on pools of oil is that we have given ourselves unlimited goodies without providing for ways to pay for them. An oil tax system similar to Alaska’s could solve California’s revenue problems without cutting the inflated salaries and pensions that promise doom for the near future if nothing is done.

Of course there is the risk – some would say certainty – that this is only a temporary fix, and the round after round of raises and pensions and health benefits to state and local employees will continue without end. This amounts to a rejection of the notion that we can have a republic: that we need tutelage from wise rulers who will restrain our unlimited appetites. That, of course, is another discussion for another time. But development of our energy resources would be a lot cheaper than keeping expeditionary forces tasked with keeping order in the Middle East. With domestic energy resources we would have a growing economy – cheap energy and economic freedom will always produce economic growth – and have a chance to build a stable republic. At the moment we face looming economic doom with nothing in sight that can bail us out. That is as true of the US as it is of California. Of course unrest in the Middle East has changed the incentives for the masters of OPEC; if the US is seen as recovering from its dependency on imported oil we may expect other crises.

On the other hand, we have already paid for the Legions who can protect us while we get on with rebuilding the republic.

Things have been slow at Chaos Manor, but they are not stopped.

I have this comment:

Iraq

One alternative would have been to mass the troops at the border and negotiate with Saddam. We do not seem even to have thought of that one, which would have been the first move of the older imperialists.

————————

As I recall Bush Sr. did that. He gave him a deadline – Get out of Kuwait. Saddam pleaded for more time, a delaying tactic. As I recall it was March 15? The deadline passed, we moved in. This shows that gunboat diplomacy won’t work. He would have treated it as a bluff until our guys moved across the border. At that point the fat was in the fire.

Even if it worked it would have been a temporary solution. Once we got him to back off and we went home he would be back to his old tricks, then we would have had to go to all the trouble to do it again, build the coalition, get countries like Egypt to support us. Endless saber rattling, deploying armies and taking them home.

B

I doubt that Saddam would ignore us this time. Had he done so then it’s on to Baghdad where I would instantly have announced that we are recruiting for the American Foreign Legion: non-citizen soldiers who will never set foot on American soil, but who will receive reasonable retirement benefits after twelve years of honorable service.

At least my study of history shows this would have had a better chance of good results than bringing in Bremer.

Fracking our way back to a republic?

Dear Dr. Pournelle,

long time reader, first time writer.

Just a short note, what is actually shown in that image is "flaring". That is, oil is produced by fracking, and the gas that is also produced is flared off as it is not economical to build the infrastructure to bring it to consumers or export it. Domestic US Gas price is currently at $4.

At the same time, LNG prices are around $18 here in Asia, so why is it not economical to build a pipeline to Oregon and a liquefaction terminal there? The economics would work, and there are private companies lining up to to so, but exports are subject to approval by the government, and the government has so far only decided to grant one export license, which I assume was either an oversight or started under the previous administration and could only be delayed, not stopped. Construction (actually conversion of an import into an export terminal) of that terminal in Louisiana is well underway.

There are plans for lots more, including in Oregon to ship out Bakken gas, but none of these plans can go forward, as the Department of Commerce is only going to start the approval process for new export licenses next year. I’m pretty sure they have much more urgent matters to attend to. Note also that government would be legally required to approve exports to all countries with which the US has a free trade agreement (e.g. your friends and allies), so it makes sense not to start the process and drag it out as long as possible. And while they are doing it, natural resources are being wasted to light up North, all because of regulatory uncertainty and intentional foot-dragging.

Keystone got some attention, but really, LNG exports are a much bigger issue, we should watch how this develops. But an example for return to republic it is not.

With best regards from Singapore,

Daniel Gebhardt

No doubt someone has thought of that and is even now lobbying for a way to retrieve that lost energy. Agreed that it should not go to waste. One does wonder why the current administration is not encouraging such projects. More revenue, more energy, stable taxes… Thank yuou for the observation. I don’t claim to be an expert on everything, but I can say that my readers collectively know a great deal…

Rambling about blessings; Republic or Incompetent Empire

By Jerry Pournelle | Mar 21, 2013 - 12:48 am | Updated: March 22, 2013 - 2:34 pm | View

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View 767 Thursday, March 21, 2013

Actually this is the Wednesday view but I didn’t get started as soon as I should have, and my automatic dating macro insists that since it’s just after midnight it’s Thursday. I could overwrite it but I don’t intend to write much anyway. I’ve been feeling a bit poorly, and I had to hustle all day doing various things, so I didn’t get much done. I did manage to get to the dentist in time to make myself look good enough to be on the podcast interview with Leo Laporte. That went well, or at least I think it did, and Leo seemed happy enough. I haven’t been able to find it posted yet – at least Google doesn’t seem to find it – but I make no doubt it will appear within a few hours.

[10:30 Reader Dave says it has appeared as http://twit.tv/show/triangulation/95]

Much of my mail, and Leo for that matter, convince me that I ought to resume my old columns again, and I’ve been mucking about with some of the stuff I’ve been working on. Back in the early days of the computer revolution there was more fun in it, and also the choices were more critical. Now a lot of good stuff has become commodity goods, and it doesn’t matter a lot which brand you buy and use. It’s all pretty good stuff, Good Enough for getting a great deal more work done than people could do before these little machines came into our lives. Everything is cheaper and most of it just works, and Moore’s Law is inexorable: It will keep getting better and better whether we want it to or not. The other day I needed a flashlight. I always keep several flashlights, but I couldn’t find one with good batteries in it, and that annoyed me; so I bought ten of them. They’re generic LED one battery flashlights, and I have seeded them around the house so that they have reached a sort of saturation point, and now I can always find one. Of course they’re as bright as the old multi-battery heavy duty lights I used to have. Makes for great convenience: always be able to find a flashlight. I think I spend twenty bucks on the lot of them batteries and all, and I get free shipping. Sign of the times, and we take it all for granted, as we take for granted that we can get serviceable clothing, pharmaceuticals, fresh vegetables and fruits at any time of the year – I could go on, but I expect the point is clear. Clear to older people, anyway. There will be readers who have always been able to lay hands on a working fountain pen, flashlight, good toothbrush, and uncountable other conveniences that weren’t so easily available even twenty years ago.

Which is to say, Civilization is a blessing, and we should count our blessings when we bemoan what’s happening to the country. Conveniences multiply, and are available to everyone. At the same time civil life becomes less civil, or does depending on where you are. More and more people live in enclaves in which they will never meet anyone not part of a privileged class wealthier than almost anyone I knew when I was growing up – real wealth, that is, with medical care, no uncertainty about food and drink, the ability to fly across the country in hours at need, the ability to communicate with almost anyone anywhere, and get, delivered to your door, clothing which in Biblical days would be called “soft raiment”. What came you to the desert to see? A man clothed in fine raiment? I say to you those wear soft raiment dwell in king’s houses…

How long this will last isn’t so clear. What used to be the necessities of life which kept people working long hours all day are now rights to which all are entitled even if they don’t choose to work at all, what many considered luxuries are now available to all as a matter of right and entitlement, and you don’t even have to be civil to those who provide it to you. Why be polite as a cost of something you deserve as a matter of right?

But I am rambling and it is time for bed, and looking around at all the stuff around me that didn’t exist when I was young, then was the stuff I read about in science fiction novels, and now we can‘t live without it’s sort of overwhelming; and I wonder what those who grew up with it as normal think of this world. I grew up in the Great Depression, and always thought that civilization was fragile. Then came the seemingly unending boom times that began just after World War II and continued, with what now look like rather minor fluctuations, until 2008. But it is now 2013, and it doesn’t look so much like a fluctuation any more. Debt rises, joblessness rises monotonically — I know. I know. Unemployment appears to be falling. Not by much but falling. Alas the number of people without jobs isn’t decreasing. We simply remove from the ranks of the unemployed those who no longer seek work. They’re still jobless. But that’s a matter for another time.

I started counting my blessings, and then started feeling gloomy because the economy isn’t improving – but in a sense it is. Moore’s Law continues inexorably. It can’t last forever. As established in Strategy of Technology, technology grows in S curves, not exponentials. But we don’t seem to have exhausted the potential of the computer revolution yet. Everyone gets a cell phone now. Calculators are essentially free. And that beat goes on. Maybe productivity will grow our way out of all this. We an hope, anyway.

And that really is enough.

For those looking for something meatier to read:

Where Higher Education Went Wrong

http://reason.com/archives/2013/03/19/where-higher-education-went-wrong

A series of essays I thought you might like that pretty much agrees with you. I don’t agree with Nick Gillespie’s essay at all, I think we have had more than enough mind blowing in the last 50 years. I’m for solid scholarship, but if don’t invest in the future generation, then we are truly screwed. The rest of the essays are worthwhile.

Phil

Reforming the education system remains terribly important: at the moment the one thing the rich can give their children that most people cannot is a good education. Cicero was proud to have educated his children himself rather than entrust it to slaves. We don’t have time to do that any more and leaving it to the professionals may create long lasting problems. If you have pore-school children, teach them to read yourself. It’s not that hard, takes about 70 half-hour lessons over a period of a few months, and when it is done it is done. Once they can read, the schools can’t take that ability away from them. Of course at the end of first grade your kids may be the only ones in the class who can read, but that’s a better problem to have than illiteracy. Now a certain percentage of kids learn to read no matter what instruction is given to them, but it’s chancy and they don’t learn systematically; better to be sure they can read before they get to school.

At least we know how to teach the kids to read, even if the schools do not. http://www.jerrypournelle.com/OldReading.html

And, if you’re looking for something else, try this

http://www.jerrypournelle.com/reports/jerryp/lays.html

This is one of the Chaos Manor special reports. There are a lot more, some quite obsolete, some still relevant. I consider Macaulay quite relevant, as is Roman history. I remind you that Macaulay wrote those essays and poems for the general public.

This is a comment on an item from https://www.jerrypournelle.com/chaosmanor/?p=12850. It came in over a week ago when I was in the middle of some flaps that ate my time, and got neglected. I have been going back and trying to clean up.

We learn nothing!

"The government builds a chicken plant " https://www.jerrypournelle.com/chaosmanor/?p=12850

I laughed aloud, and was also ashamed, all over again. Forgive me if I’ve told you this tale before. At the time of my authority in Wasit Province we were encouraged to find ways to increase employment for the Iraqis. Almost in the same breath, I received an order from Ambassador Bremer’s office in Baghdad to cease the grain harvest and let the crops rot in the field. I was incredulous and inquired as to why… the stated answer was that Iraqi grain/flour/bread did not meet UN standards for health reasons. I protested, after all, Iraqi peoples have been growing grain and making bread from the dawn of the earth (after all, the Garden of Eden WAS in present day Iraq and Cain WAS a crop farmer) and the population surely hadn’t died out from eating bad bread! I was admonished and told to follow the edict. Again, I protested – well, how would the Iraqi people get their bread and how would we insure adherence to "UN" standards? Not to worry – Baghdad would supply the people with UN flour (this at a time when distribution of fuel, food, electricity, water was problematic at best) and engage upon an agricultural program to teach Iraqi farmers how to grow proper crops. My Iraqi friends and counterparts wailed aloud! They’d had UN flour before (remember the embargoes and sanctions?) and it was wholly unsuited to making their bread – it just wouldn’t hold together properly. So I made another attempt, this time explaining the job market to Baghdad. If the farmers couldn’t harvest; how would they, and their workers, get paid for their crops? If the truckers didn’t have grain to haul, how would they earn a living? If the warehouses didn’t have grain to thresh, how would they stay open and pay their employees? If the mills didn’t have grain to mill into flour, how would they stay open and pay their employees? If the truckers didn’t have flour to haul to market, how would they earn a living? If the merchants didn’t have flour to sell to bakers and homemakers, how would they earn a living? If the bakers didn’t have flour to bake, how would they have baked goods to sell? What would the children have to eat without bread? I made the point that I was being asked to create jobs, but also to dismantle the complete economic agricultural engine that PROVIDED jobs in the province!

Oh.

I finally got a stay on the edict and let the market go on it’s merry, haphazard way. That I know of, none of the citizens of my province died from tainted bread or flour in the past 10 years. (I did hear of the subsequent agricultural ‘program’ that was largely ignored by Iraqi farmers. I believe Iraq still feeds itself.)

Jeez… in arrogance, we learn nothing!

s/f

Couv

(PS – in my description above, I neglected to point out that the vigorish owed to all the tribal leaders in the economic process would also be severely curtailed; which was another catalyst for Iraqi howling!)

David Couvillon

Colonel, U.S. Marine Corps Reserve, Retired.; Former Governor of Wasit Province, Iraq; Righter of Wrongs; Wrong most of the time; Distinguished Expert, TV remote control; Chef de Hot Dog Excellance; Avoider of Yard Work

It is a perfect example of what I expected from our invasion of Iraq, and one of the reasons I was very much opposed to starting that war, which was estimated to have a cost of $300 Billion. I didn’t believe the cost estimate (which is now above $2 Trillion as I understand it). I have long said that I prefer a Republic, but if we must have Empire, let it be competent empire; our interventions in other people’s affairs are almost invariably examples of incompetent empire. This is a good example.

The best policy for a Republic is the one voiced by John Quincy Adams: We are the friends of liberty everywhere but the guardians only of our own. There are a number of choices for a competent empire, but they all involve keeping Legions which we generally do not commit to long term actions,l and forming auxiliary military forces of non-citizens, generally the subjects of puppet regimes, to use in long term commitments – because any Imperial scheme will involve ruling without the general consent of the governed, and we are not only not good at that, we don’t want our regular forces to become good at governing without the consent of the governed. But that is another discussion.

Had we invested the $300 Billion that the Iraq War was estimated to cost in energy development in the United States, we would now have plentiful energy, a good start on Space Solar Power Satellites, and some X-projects to develop military and space technology. We would also be at least $2 Trillion less in debt.

Blood is the price of Admiralty. We paid it, blood and treasure, but that is only a necessary condition of successful empire. It is not sufficient, and Col. Couvillon’s example, one among many, tells us that we do not have the right stuff for this sort of thing. We sure could have had a great energy and space program, though.

Good Morning,

While reading your most recent letters from Brian P. he casually uses this sentence " Often, we are dependent for targeting on the same intelligence agencies which reassured us Saddam had weapons of mass destruction."

I guess the standard program of denial has worked.

We FOUND the labs and mobile production facilities. Some of them were buried near a munitions factory. There are semi-plausible cover stories, but it seems clear that they were not making aspirin or hydrogen gas…

We KNOW he had WMD as his cousin (Chemical Ali) used chemical agents on the Kurds. Western firms sold thousands of tons of chemical agent precursors to the Iraqis. Saddam publicly boasted that he had them.

So I’m always puzzled when intelligent and informed people casually dismiss the intelligence efforts and the evidence found to support them.

When you repeat something loudly enough and long enough, it really does have a way of getting past the filters and into your brain, becoming part of the zeitgeist.

Best wishes,

zuk

We got that wrong, too. We had right, reason, and interest to go in and put paid to Saddam; but it was not in our interest to convert Iraq into a political vacuum. We gave little thought to what would happen after Saddam was out of power. I say we, but I mean they: Bush paid no attention to the people I knew and worked with. He also trusted the career cookie pushers of State, which gave us Bremer, whom we did not deserve. The more incompetent Roman Emperors sent unwise and incompetent proconsuls to Iraq, so I suppose we were continuing in the tradition.

When Bush proclaimed from the carrier “Mission Accomplished”, had he acted as if he believed that and began to arrange for someone to take over from the US, it might even have been true. The problem is, who? The Brits can’t and won’t do it again. We could hardly replace Saddam with the Kuwaiti royal family, or the Saudis. Jordan? Chalabi, sometimes known in Iraq as Chalabi the thief? For some reason we did not think these things through before sending in the troops.

One alternative would have been to mass the troops at the border and negotiate with Saddam. We do not seem even to have thought of that one, which would have been the first move of the older imperialists. Of course this would have been expensive and might have been made to look like incompetence, marching the men up the hill and marching them down again; but the purpose of war is to bend the enemy to your will. Once Saddam understood that he faced the army that had destroyed his forces in the first Gulf incident, it is likely that he would have been more willing to negotiate terms we could accept – or that one of his generals would. But we never tried.

Clinton allowed sentiment to push us into the Balkan affair with the result among others of alienating the historically pro-Slavic Russians in order to gain the favor – well, it’s a bit hard to see whose favor we gained or what we got out of it. The Balkans got the Danube bridges dropped and economic chaos.

When one sends in the soldiers it is well to know what it is you want them to get for you.

Competent empire is never cheap, but it is far cheaper

Thoughts on minimum wages and equality

By Jerry Pournelle | Mar 19, 2013 - 1:36 pm | Updated: March 20, 2013 - 12:01 am | View

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View 767 Tuesday, March 19, 2013

I have most of my teeth, one of the great benefits of living in this modern age – when I was young almost no one kept their own teeth beyond the age of 70. Social Security was designed in a time when life expectancy at birth was fairly low due to infant mortality, but if you lived to age 65 you could expect another ten to twelve years if male and a couple of years longer if female; on the other hand, medical care for the elderly didn’t cost so much because there wasn’t a lot anyone could do to keep people going. There was plenty you could do for yourself, but that’s a different story. I see I am rambling again.

I have had a partial upper plate – what dentists call a flipper – since for more than fifty years, but a couple of months ago I managed to fall flat on my face on the sidewalk at dusk, and while I was able to catch my fall, sort of, I knocked out a front tooth, so another had to be added to my flipper – and Monday at lunch the glue or whatever they had used to attach it to gave way. I’m scheduled to do a video interview with Leo Laporte tomorrow at 3, so we scrambled to get to the dentist, resulting in my having an 0800 appointment today. For the last forty years I haven’t undertaken to be either civil or coherent before ten in the morning, but there was nothing for it. Fortunately I live in a village, and my dentist is in the next village so I had no problem.

All of which is a long tale on why I may be even more incoherent then usual today. I should be in form by tomorrow afternoon. No idea what we will talk about.

I am also trying to work up the energy to get back to doing silly things so you don’t have to. In anticipation of that we have built two rather amazing machines, both in handsome Thermaltake cases; one is Windows 7, and one is Windows 8. I am trying very hard to like Windows 8, but I haven’t really managed to make myself do it. Meanwhile it’s time to replace a couple of my aging main systems, but it’s also tax time: I’m not about to change horses in the middle of that stream. There’s still a lot going on out there in computer land and it’s all getting cheaper. The world of publishing has turned upside down – if you are contemplating getting into my racket writing books, the first thing to understand is that if your work has any legs at all, the eBook rights are likely to be worth a lot more than the print rights, so signing away the electronic rights for an unlimited period may be a terrible idea. I say this because a number of reputable publishing houses have opened new imprints to attract new writers, and the boiler plate language in their contracts is plain horrible. One demands electronic rights “for the life of the copyright”. Others actually accomplish the same thing without quite saying so.

Be careful out there.

I don’t do breaking news and I am trying to stay away from narrow political issues, but some issues illustrate political or economic issues of some importance.

In particular, Senator Elizabeth Warren is saying

"If we started in 1960 and we said that as productivity goes up, that is as workers are producing more, then the minimum wage is going to go up the same. And if that were the case then the minimum wage today would be about $22 an hour," she said, speaking to Dr. Arindrajit Dube, a University of Massachusetts Amherst professor who has studied the economic impacts of minimum wage. "So my question is Mr. Dube, with a minimum wage of $7.25 an hour, what happened to the other $14.75? It sure didn’t go to the worker."

http://www.huffingtonpost.com/2013/03/18/elizabeth-warren-minimum-wage_n_2900984.html

I am sure that the prospect of a $22/hour minimum wage excites a number of voters making considerably less than that. Of course any law that raised the minimum wage to that rate would also have to forbid employers from simply firing workers who don’t produce that much return on investment, which would also require a law forbidding them to go bankrupt; possibly a law requiring the firm’s customers to continue to do business with firms that raised their prices because of the minimum wage law? I realize that seems silly and beyond reason – but I will remind you that as the Roman Empire began its collapse, one desperate attempt to keep the economy going required that each man follow in the profession of his father; which had considerable effect on the economic collapse. Other desperate measures were attempted, most equally as flawed.

Also in the current news was the attempt by the government of Cyprus to bail out its banks by seizing 5 to 10% of all monies deposited in them (accompanied, of course, by a compulsory freeze on withdrawals from the banks). As I write this the Cyprus parliament has refused to give this power to government, and the government is looking for some other means to prevent the coming collapse of the banks. The government has gotten so far into debt that this radical move seemed like a good idea. I haven’t heard any proposals that the United States follow suit, but we have had compulsory bank holidays to prevent runs on the banks, and there certainly have been proposals to finance the US debt by taxing the savings of “the rich” including retirement savings. Some of those proposals have been from people usually taken seriously.

The notion of a “fair” wage is central to many socialist views of proper government. They are usually coupled with schemes to rationalize the economy: why should there be twenty brands of tooth paste? It is a wasteful practice. A rationally planned economy would prevent a great deal of effort wasted in competitive practices, thus leaving more to be paid to the workers. After all, the workers produce the goods: they have a right to a fair share, which should at least include a living wage.

The problem is that often a job cannot possibly produce enough return to warrant a “fair” wage. When the production doesn’t at least equal the cost, there isn’t a job to be had. Many ‘jobs’ are discretionary. You will pay someone to do something so that you don’t have to do it yourself, but if the cost is too high, you will just do it yourself, or go without that service entirely. Clearly there are things I would like to have done for me that I don’t think I can afford. Raising the minimum wage simply moves more jobs from the “I can afford that” to the “Can’t afford it” column. That is, it does in the real world. In Senator Warren’s world, her intentions are what matter: she means well. If her proposal ends up costing a number of people their jobs, that wasn’t her intent, so it doesn’t matter: we’ll just give them more benefits to make up for their loss.

I wish that were a parody, but it is not.

Milton Friedman once said that every economist knows that minimum wages either have no effect or create unemployment, and that this was not an observation, it was a definition. It should also be self evident.

The Huffington Post article on Senator Warren’s views on minimum wage went on to say

It didn’t appear that Warren was actually trying to make the case for a $22 an hour minimum wage, but rather highlighting the results of a recent study that showed flat minimum wage growth over the past 40-plus years coinciding with surging inequality across a number of economic indicators.

Warren went on to argue that raising the federal minimum wage to over $10 an hour in incremental steps over the next two years — a cause championed by President Barack Obama in his State of the Union address and since taken up in the Senate — would not be as damaging for businesses as some critics have argued.

I have not seen any rational argument for $10/hour as opposed to $22/hour other than the obvious statement that $10/hour doesn’t do as much harm as $22/hour would. But if the notion is a fair wage is a living wage, why not determine just what is “needed” by the worker and set the wage to that?

If the goal is to reduce inequality, then we should discuss ways to reduce inequality, including “disributist” schemes in which confiscated property is divided and given out equally to all, or by a lottery, or perhaps to those “deserving” more (to be determined by appointed or elected boards of equalization); but that does not seem to be what is proposed. Yet.

It’s lunch time, and I need to get back to the taxes.

So my question is Mr. Dube, with a minimum wage of $7.25 an hour, what happened to the other $14.75? It sure didn’t go to the worker

——————

My answer? It went for taxes, compliance with regulation, paying bunny inspectors and keeping obsolete military bases open. It went to Red China to service debt.

Ad nauseum?

B

Jerry,

Most of the "missing" $14.75 of that productivity-adjusted $22 an hour has gone into lower prices, of course. All manner of things cost far less in constant dollars these days than in 1960, due precisely to those vast improvements in productivity. And this cornucopia of cheap goods benefit most – wait for it – the people making $7.25 an hour. Most of whom Warren’s prescription would both put out of work and price out of much of the modest lifestyle they currently can afford.

Porkypine

We can all come up with places where the money went. The planned economy can always absorb more; there is never a shortage of people in need. Longer discussion in an upcoming mailbag.

“The president looks more and more like a king that the Constitution was designed to replace.”

<http://www.mcclatchydc.com/2013/03/19/186309/obama-turning-to-executive-power.html>

Roland Dobbins

The advantage of monarchy is that often the King is able to study his job rather than spend his life learning how to get the job. Of course heredity isn’t terribly reliable, so over time we learned to limit the power of kings. Empire doesn’t need kings, and in fact introducing nepotism into imperial selection of officers and advisors usually produces terrible results even form a good emperor; Marcus Aurelius demonstrated that quite well.

It does appear that Mr. Obama favors the liberal interpretation of events: that he should be judged by his intentions not for prudentially predictable results.