Month: January 2009

I got an email today from kiva.org and it prompted me to review my portfolio. I put $650 in on July 4, 2007. I’ve made 7 loans totalling $1000 to folks in Ecuador, Peru, and Tanzania (some of the money that I put in was loaned out, paid back, and loaned out again). How much did these farmers, shopkeepers, and hairstylists pay back? All of the $1000 minus two cents, since my current account balance is $649.98.

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Barney Frank, one of Massachusetts’s contributions to our Congress, had put a provision into the latest bank bailout bill that would have forced recipients of federal money to give up their business aircraft. It sounded like a war on corporate excess and it would have been a righteous war if all operators of business jets were like John Kerry, Frank’s fellow Democrat from Massachusetts. Instead of hopping the Metro to National Airport and taking one of the hourly commercial flights to Logan Airport, then hopping the T to his Beacon Hill mansion, Kerry has himself limoed out to Dulles Airport (National is closed to private aircraft), flown up to Hanscom Field, and limoed 15 miles to Beacon Hill. He doesn’t save any time compared to flying commercial, but he avoids rubbing elbows with the rabble who keep reelecting him.

Consider a bank, however, that has been paying big rents and big salaries in downtown Boston, Chicago, or New York City. Workers in a small town in Maine, upstate New York, central Indiana, or central Pennsylvania might be much cheaper to employ, but there wouldn’t be any commercial airline service to their small towns. If the bank has a bizjet, however, it can set up a facility in a place that is otherwise impractical to reach. Executives can fly in and out for meetings (a surprising number of small towns have a jet-ready airport). Take away the bizjet and those small town workers will have a more difficult job competing with workers in the biggest cities that have frequent commercial airline service.

Frank’s attempt to suppress business aviation would have had the effect of favoring his constituents (all of whom live close to Boston’s Logan Airport, a very busy travel hub) and harming people in small-town America. So far, however, members of Congress from states such as Kansas are successfully fighting what are effectively restrictions on banks doing business anywhere other than in our larger cities.

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According to the press coverage of the US Airways floating tour of the Hudson River, the Airbus A320 has been certified for single-pilot operation. In the old days this airplane would have flown by a crew of two pilots, one titled “Captain” and one with the job title of “First Officer”. One of the two pilots would have been handling the stick and rudder while the other pilot worked the radio, flaps, slats, landing gear, pressurization controls (very critical in this case, since a jetliner ditching usually involves dumping the cabin pressure and then sealing the cabin just before impact). Generally these roles are swapped after each leg of a trip. The “pilot monitoring” role can be tougher than the “pilot flying” role when things go wrong. The stick and rudder stuff is what pilots have been doing since their first flight in a Cessna. Furthermore, all airplanes respond in a similar way to stick and rudder commands. The systems and switches on a modern airliner, however, are extremely complex and unique to a particular airplane type. For knowing what switch to push and in what order, experience gained on a previous airplane is of no value.

From reading the New York Times, we learn that Chesley B. Sullenberger III was the pilot of US Airways 1549 and he was apparently working everything in the cockpit by himself, a truly remarkable achievement.

[A reader of the London Times, by contrast, would have learned that the A320 is flown by a two-pilot crew and that the first officer was Jeff Skiles (profile).]

[News accounts have not spent a lot of ink on the people who did the toughest job in this incident: Shelia Dail, Donna Dent, and Doreen Welsh, the flight attendants. Being a pilot is a fairly straightforward job in a tightly controlled environment (except when both engines quit!). The flight attendants, however, face unique situations depending on who shows up as a passenger. In their training and drills they have to evacuate a fully-loaded airplane within 90 seconds.]

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Suppose that you had been president for eight years and had spent weeks preparing your farewell address to the American people. You want everyone to be tuned in and paying attention. What news story could possibly be big enough to distract hundreds of millions of people? How about a jet airliner losing both engines and making a forced landing in the frigid Hudson River? What are the odds of that? No U.S. jet airliner has ever had to land in the water. Of course it would make an even more improbable and therefore compelling story if all the passengers and crew simply walked out of the floating airplane onto the Circle Line cruise boat.

Maybe God hates George W.

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I was having dinner with a New York friend, her daughter, and two Argentine girls. The Argentines were talking about how they’d learned English and would casually use four-letter words in English back in Argentina. When they came to Miami they had to learn not to say “fuck” all the time. I said that it reminded me of one of my favorite movies, I Love You to Death, with Kevin Kline. It opens with him confessing to a priest and wondering whether cursing out his mother-in-law in a language she doesn’t understand counts as a sin (“it counts” is the priest’s response).

As we were leaving the restaurant, a familiar-looking guy walked in. My hostess introduced me. “This is Kevin Kline; he lives in the neighborhood.” We explained that we’d just been talking about I Love You to Death. He responded “It’s a true story, you know.”

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Desperate financial times call for desperate measures and certainly I’ve put forth some crazy ideas here in my Weblog, but people expect a touch of insanity from a private blog. On January 11, the New York Times ran an op-ed by Thomas Friedman in which he

1) discloses that his wife is a public school teacher (union member)

and

2) proposes that the government eliminate federal income tax on all schoolteachers

He says that “more talented people would choose these careers” if they didn’t have to pay any tax.

Were we to implement the tax break immediately, 100% of the benefits would flow to existing teachers because no new ones will be hired until September. Friedman implies that these existing teachers are untalented because they are paid so little (topping out at just over $100,000 per year after 22 years, or age 44 for the typical person who starts after college) I don’t think he believes that the untalented will do a better job without the distraction of paying federal income tax, so perhaps he is holding out hope for five years from now. In September 2009, a truly talented young person, hearing about this tax break, will decide to go to a teacher’s college to pursue a Bachelor’s in Education. In September 2013 that person will have graduated and be ready to work. Assuming an average career length of 30 years, by 2014 fully 3 percent of our schoolteachers will be the talented ones attracted by the tax break and taxpayers will only be wasting 97 percent of their money by paying the untalented legacy schoolteachers extra.

I’m kind of surprised that the Times ran this piece.

[Note that Friedman’s idea is not totally at odds with my economic recovery plan, in which I propose eliminating public employee unions and teacher tenure.]

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Usually it is bad news if a plane has a reputation for being flaky. The Piper Malibu/Meridian has a troubling history of engine fires, engine failures, landing gear problems, and generally weak construction for a plane that goes up to 25,000′ (Malibu; overworked piston engine with two turbochargers) or 30,000′ (Meridian; same plane with a turboprop engine). The windshields are kind of a sore point too, costing $28,000 to replace after typical problems with the defroster.

But what if you want people to believe you when you call ATC and say that your windshield has imploded? There is really no better airplane. Here’s a CNN article about a guy who bailed out of a 2002 Piper Meridian, tail number N428DC. He probably doesn’t get much credit for managing money, but I give him a lot of credit for being able to parachute out of a Meridian, a plane whose door is a good long walk from the pilot’s seat and right next to the tail.

Update: http://www.youtube.com/watch?v=nhgPCL3uCH4 shows the guy flying under a bridge in 2000.

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Geography quiz for today: What countries (or states within a country) are named after individuals or families?

To kick things off, I will supply one easy answer: Saudi Arabia, named after the Saud family.

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A discussion arose around looking for a new doctor and what it meant for a doctor to be “Board-certified”. We called a friend who is an M.D. She explained that this was an exam administered by an organization of specialists. “A lot of the questions aren’t very relevant to practice and there are plenty of people who are good at taking tests who can pass the Boards without being good physicians.” What if someone didn’t pass the Boards? Could they still practice as a specialist? “Absolutely.”

How about looking at where a doctor trained? A doctor can’t graduate from residency without having achieved a certain level of proficiency at least certified by the hospital where he or she trained, right? At least a few of the doctors at the hospital have to agree to sign his or her diploma? “Wrong. Finishing residency means that you spent three years in residency. If it was a very competitive residency, it means that the doctor looked good when graduating from medical school and getting matched. But if he or she slacked off during residency, you have no way to know.”

I was beginning to get worried. In aviation you don’t get a pilot’s certificate based on having taken a minimum number of hours of lessons, though there are minimum hour requirements. You get a certificate when an independent FAA-designated examiner (or the FAA itself) flies with you and compares your skills to a published standard. Was there nothing like that in medicine? “There used to be for surgeons, but it was too hard to administer so they got rid of it.”

Just when I thought that it couldn’t get any worse, I reflected that hospitals were non-profit organizations. The typical non-profit is focused on its staff, avoiding employee lawsuits, and growing its cash hoard. There is little interest in the customer or the quality of services delivered. If a resident was doing a bad job, maybe there was no way to fire the guy. “Your fears are justified,” my doctor friend responded. “I trained with one guy who was spectacularly incompetent. He came close to killing a few patients. Everyone knew that he was incompetent. We were all dragged into a room by the head of the program who explained that this guy might sue if we continued to give him negative peer evaluations. Thus we were not allowed to say anything bad about him in the future. He finished his training.”

So… in a world where people who plug computers together get certified by Microsoft, it seems that there is some check on a doctor’s quality when he or she finishes medical school and virtually none after that. How could a patient find a good doctor then? “The only way is through personal recommendations from other physicians.”

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In thinking about the Federal Government’s $1.3 billion spent so far on coupons for digital TV tuners, it occurred to me that at $40 per coupon, $1 billion+ was an awful lot of conversion boxes. Dividing the $1.3 billion by $40, we find that the government has apparently handed out 32.5 million coupons.

http://www.connectmycable.com/resources/cable-vs-satellite.html says that 85 percent of U.S. households had cable or satellite TV in 2006. Is it believable that the remaining 15 percent of U.S. households figured out that this government hand-out program exists, took the trouble to fill out the Web forms or paperwork to get their coupons, and brought home a converter box to uglify their homes?

If it is not believable, might there be some enterprising retailers out there who are delivering fictitious converter boxes to fictitious consumers?

[Note that this analysis is slightly oversimplified. A house could have cable TV in the living room and an analog TV with rabbit ears on the kitchen counter. The government might be wasting some of the $1.3 billion on administrative costs rather than putting it all into coupons (the newspaper articles on this subject aren’t clear on whether the budget was $1.3 billion in coupons or $1.3 billion in total for the program).]

[As a second aside, can anyone think of a greater waste of government money? Regardless of how much was raised from selling the recovered spectrum, why would we choose to spend it on these converter boxes? Wouldn’t $1.3 billion in extra scientific research have been more likely to give the U.S. economy a boost?]

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