Quotulatiousness

June 29, 2015

More on the “self-driving truck” issue

Filed under: Business,Economics,Railways,Technology,USA — Tags: , , , , — Nicholas @ 02:00

In the comments to this post, Tom Kelley provided a worthwhile digression on the topic that I felt deserved a wider audience, so with his permission, here’s Tom’s response:

Given that the trucking industry has been my sandbox for quite some time, I can safely extend Megan’s prognosis to also include the low long-term risk of job losses due to self-driving vehicles.

Frankly, I have to be wary of any “expert” who can’t even get the name of his source (the American Trucking Associations — yes, plural — not the American Trucker Association) transcribed correctly.

Apart from the myriad technical issues standing in the way of driverless trucks, the insurmountable barrier is anti-competitive trucking regulations passed on behalf of the government’s favorite white elephant, the rail industry. Invariably, these regulations are tarted up under some guise of safety (Let’s see, was it a truck or a train that blew the town of Lac-Mégantic off the map??? Hmm).

The bottom line is that any change that would have the slightest possibility of making trucking more productive is quickly met with massive dis-information campaigns, and even more massive lobbying from the rail industry. Even the most minor dimensional changes designed to reflect the current realities of truck freight transportation stand little if any chance of making it past regulators with a permanent disdain for free enterprise.

We can’t have electronically actuated brakes on trucks because the regulators have no grasp of brakes or electronics, and somebody wants to replace the driver with electronics? Seriously? Of course these same folks seen to have no problem flying cross-country at 500 MPH in a commercial jetliner that is literally flown by wire.

And even if the government types were perfect actors in this little tale, then you have the American tort law system, run/regulated by, for, and about the trial lawyers. Even with professional truck drivers who can deftly avoid putting incompetent car drivers on their way to a Darwin award, hundreds of four-wheeler drivers still manage to commit suicide-by-truck every year, followed quickly by their otherwise destitute estates suing innocent trucking companies for millions.

Can’t you just hear the jury summation now: “The eeevvilll trucking company wanted to save a few pennies by outsourcing the driver’s job to a microchip! The must be punished! My client, a fourth cousin of the homeless man who jumped off a bridge in front of a truck MUST be awarded $10 million for the pain and suffering from losing a relative he never met. No justice, no peace!”

No insurance company in their right mind would insure a driverless truck for real-world operation.

There’s no question that the technology is available to make the concept work, I was on-board numerous autonomous vehicles of all sizes back in 1997.

It will take several major societal shifts before any serious degree of autonomy makes it into real world trucking operations.

June 26, 2015

The self-driving truck won’t displace many human truck drivers for years to come

Filed under: Business,Economics,Technology,USA — Tags: , , , , — Nicholas @ 02:00

I’m far from being a Luddite, but I find Megan McArdle‘s analysis of the low short-to-medium term risk of job losses due to self-driving vehicles to be pretty convincing:

… my objections are actually to the understanding of the trucking industry works and of self-driving vehicles. Fully automated trucks, with no drivers at all, are probably going to arrive later than Santens thinks, take longer to roll out than he projects, and displace fewer workers than he thinks they will. I’m not saying it will never happen. I’m just skeptical that this is going to be a major policy problem in the next two decades.

Why?

Start with what truckers do, and how many of them there are. Santens quotes the American Trucker Association to get 3.5 million. The Bureau of Labor Statistics puts that figure a bit lower, around 2.8 million. More importantly, only 1.6 million of those are long-haul truckers. The rest are “driver/sales” employees or “Light truck or delivery services drivers.” Those are short-haul services that will not quickly be replaced by automated cars, both because chaotic urban roads are harder for autonomous vehicles to handle and because part of the job is loading and unloading the truck (something that long haul drivers may also do).

Also: Why would we assume that the advent of driverless trucks would be bad for trucking support jobs? Those folks are doing stuff like maintenance or loading that still has to be done. Moreover, other jobs will be created, in designing and maintaining the new systems. Someone has to map all those roads.

But I think it will be a while before we get to a fully autonomous vehicle with no people in it. The “driverless truck” that Santens links is not actually driverless; it’s partially autonomous. If it foresees something it can’t deal with, such as heavy snow, it signals to the driver to take over; if the driver doesn’t respond, it slows to a stop. That’s an improvement in the lives of truck drivers, not a job killer.

June 25, 2015

A different kind of crowd-funding

Filed under: Economics,Media — Tags: , , — Nicholas @ 04:00

Christopher Taylor starts off by praising to the skies a movie I’ve never seen … but he goes on to discuss a variant of crowdfunding that might be a significant change to how movies are made:

… the big studios are corporations that answer to a board of stockholders. And the stockholders aren’t interested in great film making, they are interested in making money off their stocks.

So the Broken Lizards guys went to crowdfunding to raise money for their film, and have done quite well. They did so well that they don’t need a big bunch of studio dollars and interference to make the movie.

But here’s where it gets really interesting. See, crowdfunding sites raise money by offering goodies and the joy of helping a product succeed. They are not investment sites so much as a chance to be a patron of something you want to see on the market as well as a chance to get something from the company. Free copies, a mention in the book, a token in the game named after you, and so on.
Well that’s all about to change in a big way.

Jay Chandrasekhar writes:

    At our meeting, I vented to Slava about my perception of crowdfunding. I told him I wished people could invest in the movie and then own an equity piece of the backend. He said, “I totally agree.” That’s when we hit it off. He said that there is legislation in Washington, as we speak, that if signed, will make equity-based crowdfunding a reality. Think about that.

I’m with Jay here. Think about that. Its very likely that soon you will be able to donate to a crowdfunded project and get money back from its sales. In other words, it will actually be an investment, not just patronizing.

This is a huge key in changing the way that media gets made. All those projects the studios and TV channels pass on because it isn’t hot or doesn’t make sense to them? If this happens, they can have a chance.

June 19, 2015

Even the Fed pays attention to the rise of craft brewing

Filed under: Business,USA — Tags: , , , — Nicholas @ 03:00

The Federal Reserve Bank of Richmond had an interesting article on the rise of craft beer by Jamie Feik and Joseph Mengedoth:

In many places across the country, it’s hard not to notice the shift in product offerings at local bars and restaurants and in the beer aisle of the grocery store. The colorful, ornate tap handles of craft brewers have joined the classic blue, red, and silver posts of the traditional powerhouses, and bartenders play the role of consultant purveying the selections. Shoppers who once stood in the beer aisle trying to decide how many cans of beer to buy now stand in front of coolers filled with different brands and styles of beer available in single bottles, packs of four, six, or 12, and even on tap in a growing number of stores. Many of them have been made at a brewery down the street; according to the Brewer’s Association (BA), the trade association that represents the craft beer industry, approximately 75 percent of the drinking-age population in the United States lives within 10 miles of a brewery.

In 2014, there were 615 new craft breweries that opened, pushing the number in the United States to 3,418, more than twice the number that existed just five years earlier. The BA defines a craft brewery as one that produces fewer than 6 million barrels a year, is less than 25 percent controlled by an alcoholic beverage industry member that is not itself a craft brewer, and produces a beverage “whose flavor derives from traditional or innovative brewing ingredients and their fermentation.” The ownership restriction excludes the craft-style subsidiaries — such as Shock Top, Goose Island, Leinenkugel, and Blue Moon — of large brewers like Anheuser-Busch InBev and MillerCoors (the two largest brewers in the United States).

Although craft beer remains a relatively small segment of the market, accounting for only 11 percent of the beer produced in the United States in 2014, the segment is growing rapidly. Craft beer’s share of production has more than doubled since 2010, when it was just 5 percent. In 2014, craft beer sales volume increased nearly 18 percent, according to the BA, versus just 0.5 percent for the overall beer industry. The retail dollar value of craft beer grew 22 percent in 2014, while the total U.S. beer market increased only 1.5 percent in value.

The growth of small breweries runs counter to the trend of consolidation in the beverage industry that persisted through much of the 20th century. Why are craft brewers thriving?

June 15, 2015

The “Kitchen Debates” of 1959

Filed under: Economics,History,USA — Tags: , , , — Nicholas @ 03:00

B.K. Marcus explains how ice cream was the secret weapon that won the Cold War:

Richard Nixon stood by a lemon-yellow refrigerator in Moscow and bragged to the Soviet leader: “The American system,” he told Nikita Khrushchev over frosted cupcakes and chocolate layer cake, “is designed to take advantage of new inventions.”

It was the opening day of the American National Exhibition at Sokol’niki Park, and Nixon was representing not just the US government but also the latest products from General Mills, Whirlpool, and General Electric. Assisting him in what would come to be known as the “Kitchen Debates” were attractive American spokesmodels who demonstrated for the Russian crowd the best that capitalism in 1959 had to offer.

[…]

“Don’t you have a machine,” he asked Nixon, “that puts food in the mouth and presses it down? Many things you’ve shown us are interesting but they are not needed in life. They have no useful purpose. They are merely gadgets.”

Khrushchev was displaying the behavior Ludwig von Mises described in The Anti-Capitalistic Mentality. “They castigate the luxury, the stupidity and the moral corruption of the exploiting classes,” Mises wrote of the socialists. “In their eyes everything that is bad and ridiculous is bourgeois, and everything that is good and sublime is proletarian.”

On display that summer in Moscow was American consumer tech at its most bourgeois. The problem with “castigating the luxury,” as Mises pointed out, is that all “innovation is first a luxury of only a few people, until by degrees it comes into the reach of the many.”

It is appropriate that the Kitchen Debate over luxury versus necessity took place among high-end American refrigerators. Refrigeration, as a luxury, is ancient. “There were ice harvests in China before the first millennium BC,” writes Wilson. “Snow was sold in Athens beginning in the fifth century BC. Aristocrats of the seventeenth century spooned desserts from ice bowls, drank wine chilled with snow, and even ate iced creams and water ices. Yet it was only in the nineteenth century in the United States that ice became an industrial commodity.” Only with modern capitalism, in other words, does the luxury reach so rapidly beyond a tiny elite.

“Capitalism,” Mises wrote in Economic Freedom and Interventionism, “is essentially mass production for the satisfaction of the wants of the masses.”

May 14, 2015

Moore’s Law challenged yet again

Filed under: Business,History,Technology — Tags: , — Nicholas @ 02:00

In Bloomberg View, Virginia Postrel looks at the latest “Moore’s Law is over” notions:

Semiconductors are what economists call a “general purpose technology,” like electrical motors. Their effects spread through the economy, reorganizing industries and boosting productivity. The better and cheaper chips become, the greater the gains rippling through every enterprise that uses computers, from the special-effects houses producing Hollywood magic to the corner dry cleaners keeping track of your clothes.

Moore’s Law, which marked its 50th anniversary on Sunday, posits that computing power increases exponentially, with the number of components on a chip doubling every 18 months to two years. It’s not a law of nature, of course, but a kind of self-fulfilling prophecy, driving innovative efforts and customer expectations. Each generation of chips is far more powerful than the previous, but not more expensive. So the price of actual computing power keeps plummeting.

At least that’s how it seemed to be working until about 2008. According to the producer price index compiled by the Bureau of Labor Statistics, the price of the semiconductors used in personal computers fell 48 percent a year from 2000 to 2004, 29 percent a year from 2004 to 2008, and a measly 8 percent from 2008 to 2013.

The sudden slowdown presents a puzzle. It suggests that the semiconductor business isn’t as innovative as it used to be. Yet engineering measures of the chips’ technical capabilities have showed no letup in the rate of improvement. Neither have tests of how the semiconductors perform on various computing tasks.

May 3, 2015

QotD: Innovations from foreign shores

Filed under: Britain,Humour,Quotations — Tags: , , — Nicholas @ 01:00

We had ridden for about two miles, when we noticed, a little ahead of us in a space where five ways met, a man with a hose, watering the roads. The pipe, supported at each joint by a pair of tiny wheels, writhed after him as he moved, suggesting a gigantic-worm, from whose open neck, as the man, gripping it firmly in both hands, pointing it now this way, and now that, now elevating it, now depressing it, poured a strong stream of water at the rate of about a gallon a second.

“What a much better method than ours,” observed Harris, enthusiastically. Harris is inclined to be chronically severe on all British institutions. “How much simpler, quicker, and more economical! You see, one man by this method can in five minutes water a stretch of road that would take us with our clumsy lumbering cart half an hour to cover.”

George, who was riding behind me on the tandem, said, “Yes, and it is also a method by which with a little carelessness a man could cover a good many people in a good deal less time than they could get out of the way.”

George, the opposite to Harris, is British to the core. I remember George quite patriotically indignant with Harris once for suggesting the introduction of the guillotine into England.

“It is so much neater,” said Harris.

“I don’t care if it is,” said George; “I’m an Englishman; hanging is good enough for me.”

Jerome K. Jerome, Three Men on the Bummel, 1914.

April 20, 2015

The Wright Brothers – early practitioners of lawfare

Filed under: Law,Liberty,Technology,USA — Tags: , , , — Nicholas @ 03:00

David Warren casts his thoughts into the air, but a hundred years ago the Wright Brothers’ lawyers would have been doing their legal damnedest to bring him back down to earth in a hurry:

Work on powered, controlled flight in the United States was far behind that in France, or England, but fell farther behind thanks to the Wright brothers. Fixated on the problem of converting invention into wealth, they pursued rival aviators around the USA with teams of lawyers. Their numerous, voluminous, cumbersome lawsuits were based on often fanciful patent claims, emerging from their own intensely secretive research.

One thinks for instance of the great aviator, Louis Paulhan (first to fly London to Manchester), who arrived with two Blériot monoplanes and two Farman biplanes to give flying demonstrations across the USA. Amazed at the workings of the American judicial system, but ignoring legal injunctions to prevent them from flying their machines, they took every prize at the Los Angeles Air Meet in January 1910, setting new records for altitude and endurance.

The Wrights were present, there as elsewhere, though never competing. They and their gaggle of lawyers followed Paulhan and the other foreigners around the country, serving them with process papers, and demanding unbelievably huge sums to call off their dogs, in vile and obvious attempts at extortion. And then they’d hit the local impresarios with additional suits to impound all the cash from ticket sales, &c. Truly: vicious and contemptible men.

To avoid fines or imprisonment in backwoods American jurisdictions, the visitors took to giving their demonstrations entirely for free, but still the lawsuits kept coming. Finally they gave up and went home.

And there’s even a maple-flavoured sidelight in the story:

Part of the reason for Canada’s early advances in aviation (first flight of the Silver Dart at Baddeck in Cape Breton, with its ingenious ailerons, &c) was the migration of American inventors, such as the brilliant motor-mechanic Glenn Curtiss, to safe territory away from the corrupt and unpredictable U.S. courts.

This, I suspect, was among the reasons that the spectacularly inventive Scotchman, Alexander Graham Bell, re-located from his grand mansion in Washington, DC. At first he went north, back to Canada (where he had settled before), only for the summers; but soon he was staying through the winters, too. Not only in flight, but in all the many other areas of his pioneering work (he invented the telephone, &c), he was afflicted with lawsuits from American cranks, with those dollar signs twirling in their eyes and the slick lawyers lining up behind them, ready to exploit a patent regime wide open to political manipulation. For apart from the beauty of the Bras d’Or landscape, Bell was back under the protection of British Common Law.

April 16, 2015

Measuring productivity in the modern economy

Filed under: Economics — Tags: , , , — Nicholas @ 03:00

Tim Worstall on how our traditional economic measurements are less and less accurate for the modern economic picture:

… in the developed countries there’s a problem which seems to me obvious (and Brad Delong has even said that I’m right here which is nice). Which is that we’re just not measuring the output of the digital economy correctly. For much of that output is not in fact priced: what Delong has called Andreessenian goods (and Marc Andreessen himself calls Mokyrian). For example, we take Google’s addition to the economy to be the value of advertising that Google sells, not the value in use of the Google search engine. Similarly, Facebook is valued at its advertising sales, not whatever value people gain from being part of a social network of 1.3 billion people. In the traditional economy that consumer surplus can be roughly taken to be twice the sales value of the goods. For these Andreessenian goods the consumer surplus could be 20 times (Delong) or even 100 times (my own, very controversial and back of envelope calculations) that sales value.

We are therefore, in my view, grossly underestimating output. And since we measure productivity as the residual of output and resources used to create it we’re therefore also grossly underestimating productivity growth. We’re in error by using measurements of the older, physical, economy as our metric for the newer, digital, one.

In short, I simply don’t agree that growth is as slow as we are measuring it to be. Thus any predictions that rely upon taking our current “low” rate of growth as being a starting point must, logically, be wrong. And that also means that all the policy prescriptions that flow from such an analysis, that we must spend more on infrastructure, education, government support for innovation, must also be wrong.

April 14, 2015

Patently ridiculous, in one image

Filed under: Bureaucracy,Law,Technology,USA — Tags: , — Nicholas @ 03:00

Total US patents issued annually 1900-2014

H/T to Veronique de Rugy, who explains that much of the increase in “patents for trivial and non-original functions” can be traced back to the creation of one particular court.

April 2, 2015

How do we measure prosperity? Badly

Filed under: Economics,History,Technology — Tags: , — Nicholas @ 05:00

At Coyote Blog, Warren Meyer points out that we do not have a useful way to measure prosperity:

GDP growth and unemployment reduction are terrible measures. Just to give one example, these measures looked fabulous in WWII. But the average person living in the US had access to almost nothing — they couldn’t buy anything under rationing, they couldn’t travel for leisure, etc. GDP looked great because we were building stuff and then blowing it up, the economic equivalent of digging a hole and filling it in (but worse, because people were dying). And unemployment looked great because we had drafted everyone and sent them off to get shot.

[…]

How do we take into account that even if a person has the same income as someone in 1952, they are effectively wealthier in many ways due to access to medical procedures, travel, entertainment, electronic devices, etc?

Somehow we need to measure consumer capability — not just how much raw money one has but what can one do with the money? What is the horizon of possibilities? Deirdre McCloskey tends to eschew the term capitalism in favor of “market-tested innovation.” I think that is a pretty powerful description of our system. But if it is, we really are only measuring the impact of productivity and cost-reduction innovations. How do we measure the wealth impact of consumer-empowerment innovations like iPhones? Essentially, we don’t. Which, by the way, may be one reason our current crappy metrics say we have growing income inequality. With our current metrics, Steve Jobs’ increase in wealth is noted in the metrics, but the metrics don’t show the rest of us getting any wealthier by the fact that we can now have iPhones (or the myriad of competitors the iPhone spawned). The consumer surplus from iPhones undoubtedly dwarfs the money Jobs made, but it doesn’t show up in any wealth calculations.

March 30, 2015

Apple’s cultural significance, as illustrated by reactions to the Apple Watch

Filed under: Business,Media,Technology — Tags: , , , — Nicholas @ 04:00

James Lileks points out that Apple does not get the media attention for being innovative (at least, not just for innovations):

What’s that, you say? You don’t want an Apple Watch?

Let’s talk about that.

People seem obliged to offer substantial, reasoned arguments why they don’t want one — and that seems proof that Apple’s cultural position is enormous. I mean, imagine it’s 1956, and Kelvinator just brought out the new Fido-Matic Fridge that automatically extrudes moist dog food into a bowl at preset intervals. The press wouldn’t say boo. The Today show wouldn’t do a live report from people queued up at the Kelvinator store. There wouldn’t be bitter battles in the letters-to-the-editor section about Kelvinator fanboys falling for the latest gimmick, and besides Frigidaire did that last year.

But Apple invents something, and the world is riven into two camps. Those who desire, and those who decline. The former group is regarded with less interest than the latter, since those who want the Watch are assumed to be devotees of Apple who would pay $199 for a white plastic brick used to prop open doors.

The people who don’t want them — ah, they’re the ones who make for good copy. They’re the rebels now. If I were a New York Times editor, the day the Watch was released I’d run a lifestyle-section story about men in Brooklyn with carefully curated beards who repair 1950s watches, and how this attention to the craft — nay, the art — of timepieces stands as a Contrast, and perhaps a Rebuke, to the overcomplicated Watch the sheep are lining up to get.

“It’s just an honest thing,” the watch-repair guy (Josh, I’m guessing) would say. “You hold it to your ear, you hear it tick. It manifests time in a real way. The delicacy of the movement — it’s almost intimate, to have a machine on your wrist with such precise detail, devoted to just one thing. The time.”

Yeah yeah. Go have a sarsaparilla, hipster. Look: You don’t want an Apple Watch, you don’t. But reject it for the right reasons — and that’s not because it’s another screen that takes you away from dealing with humanity, because that’s not what it is.

March 23, 2015

Changing Times – Railroads & Canals I IT’S HISTORY

Filed under: Britain,Economics,Railways,Technology — Tags: , — Nicholas @ 02:00

Published on 10 Mar 2015

It certainly is no big deal to have a small cruise along the canals or ride a train. But what is essential infrastructure today had to be invented out of necessity in the late 18th and early 19th century. In our new episode Brett tells you everything about canals and railways and how they changed the way we transport things.

March 17, 2015

The Gabbet Fairfax MARS Semi-Automatic Pistol

Filed under: Technology — Tags: , — Nicholas @ 02:00

I think I first heard of this rather imposing handgun in L. Neil Smith’s SF novel The Probability Broach (another character in his novels champions the Dardick 1500, also a weird and wonderful handgun). Last week, Robert Farago had a post about a fantastic collection of Luger pistols that also included an example of the MARS:

Gabbet-Fairfax MARS pistol left

Gabbet-Fairfax MARS pistol right

This rare and monstrous handgun once had bragging rights as “the most powerful handgun in the world.” Considering it was only produced from 1898-1907 and would not lose that title until the 1970s, that’s quite an accomplishment. That small production time, of course, resulted in a very limited run of these guns. Approximately 80 were ever produced in all their proprietary configurations (8.5mm, .36 (9mm), .45 Long, and .45 Short). The example shown above is an extremely early version (c. 1898-1900) and stamped with the serial number 4. It also has the fine blued finish and wonderful checkered walnut grips. It remains in its all-original and unaltered condition.

The pistols were very well-made with all hand-fitted parts, and extremely powerful, but ultimately they were not to be. Why? A few reasons existed and they all had to deal with the gun’s rather complex design. First of all, complex designs historically tend to not render themselves well to life in military service. Complex devices have more parts to foul and are difficult to repair/clean in the field.

Second, this complex device, utilizing a long-action recoil, had such horrendous recoil that it was prone to feeding problems. The recoil was partially due to the powerful cartridges, but also because of the long travel of the moving parts. It also suffered from a heavy trigger pull. All these gripes led to the MARS being passed over for military contracts, the sole hope of its designer, Hugh Gabbet-Fairfax. There were never any issues with its “man-stopping” ability, but its recoil was its ultimate undoing. Fortunately, it left us with some rather entertaining quotes such as, “No one who fired once with the pistol wished to shoot it again,” and “singularly unpleasant and alarming.” Even without military contracts or commercial sales, this rare curio remains a supremely desirable collectible.

March 11, 2015

China’s “Catch up” growth

Filed under: China,Economics — Tags: , , , — Nicholas @ 02:00

In Forbes, Tim Worstall looks at last week’s announcement that China is (slightly) lowering their economic growth forecast.

On that larger scale though what people are worrying about is this. Catch up growth is easier than growth from the technological frontier. What is meant by this is that it’s a great deal easier to generate economic growth if you have an example in front of you of how to do things. To take a trivial example, if you can go and buy a mobile phone, take it apart to see how it works, it’s a lot easier to copy that technology than it is to invent it for the first time. And this is true of how you make cement, how you put up buildings, how you farm a field and so on. And at root that’s what economic growth is: becoming more efficient at doing all of these things as well as everything else. Each time you become more efficient at doing one task you free up resources to be doing something else. Thus you get both the original thing plus the new one from the same resources: this is the very definition of economic growth.

However, there’s a limit to such catch up growth. In certain areas China is right at that technological frontier (in some areas ahead of the rest of the world in fact). Which is where things become more difficult: there’s no one to copy. Therefore that invention has to happen domestically. This is obviously more difficult. But also it rather requires a certain set of institutions. The rule of law, property rights and so on. These aren’t things that China notably has (although things are very much better than they were decades ago). It’s those headwinds that need to be beaten. Bringing in these new institutions, embedding them in the society and the economy, without causing so much disruption as to slow down growth while they are done.

The standard jargon for this is “middle income trap”. To be crude about it the general feeling is that it’s pretty easy to go from dirt poor to middling income. The essence is really just to stop doing stupid things that hold economic development back. China’s done that very well even though they did start from a very low level of an immense number of very stupid things that Maoism did to hold economic growth back. The middle income trap is where the transition over to those institutions that promote technological frontier growth don’t appear (or are not imposed). And thus the stunning growth peters out.

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