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Mental challenge for today: A rich 29-year-old guy invites a 21-year-old fashion model and college undergraduate to go on an all-expenses paid vacation with him to Italy where they will be sharing a luxury hotel room. She accepts the invitation. Are they likely to have sex?

This question is being investigated by the 10 lb. heads of Stanford University, with the help of one of the world’s most expensive law firms, Pillsbury (disclosure: I have served as an expert witness in Delaware Chancery Court for a Pillsbury client; Pillsbury won the case so apparently they are worth whatever they’re charging).

This question also merits an epic-length New York Times magazine article.

What do readers think? Can a society survive when some of its best educated people are occupied with this kind of investigation? What does it mean when the editors of a major newspaper think that this is newsworthy?

My idea for Stanford’s next research inquiry: Do visitors to Las Vegas tend to drink and gamble?

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Boston’s MBTA bus, subway, and rail system shut down due to the snow for about 36 hours. The New York Times article on the system characterized it as “underfunded.” This is a system that is paying pensions for a lot of folks who retired at age 41 under the recently abandoned “23-and-out” rule (Boston Globe) and pays bus drivers about $100 per hour to work at night (boston.com). When Jesse on Breaking Bad ran out of money buying strippers and drugs for all of his friends, was he “underfunded”?

Let’s suppose that the New York Times is right and the MBTA actually does have less funding per passenger than other systems. What to do about it? I vote for congestion pricing for cars and give the money to the MBTA so that it can pay all of those retired bus drivers and also push the snow off the tracks.

What do readers think? Is the impending insolvency of the MBTA due to its pension commitments and debt service enough to motivate Bostonians to go where no other U.S. city has gone?

Related:

• History of Public Employee Unions

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It would be interesting to gather reader perspectives on the most perverse things about the U.S. tax code. Here is my personal list of things that stick out either because they affect a lot of people or have big dollar signs attached.

That child care expenses are not fully deductible from income. Suppose that a parent works to earn $40,000 per year and pays a nanny $40,000 per year to stay home with the children. As the family is no better off financially than when the parent stayed home personally, why is the family paying more in taxes? Maybe the argument is that the family gets a huge emotional and personal benefit from having a child around and therefore the nanny costs are personal rather than work-related? But if that is true, why are children treated as an economic burden with no emotional or personal value when it comes time to award child support to the parent victorious in a custody lawsuit?

That a person who collects $100,000 per year in child support, more than 20X what a typical married couple spends on a child (see previous posting regarding on UCLA research), can claim that child as a financial “dependent.”

That child support, which in many states functions by design in the same way as alimony, is treated differently from a tax perspective (tax-free to the plaintiff, not taxable to the defendant). Once child support exceeds the USDA-estimated cost of rearing a child, why wouldn’t the IRS treat the excess as alimony-in-fact? (Separately, why hasn’t the IRS addressed the apparent discrepancy between the 567,887 Americans who report paying alimony and the roughly 300,000 who report receiving it, with the result that taxpayers who were not divorce litigants must pay a larger share of their income in tax to make up the shortfall? (treasury.gov report).)

That health care costs, which are nearly 20 percent of the GDP, are deductible or not depending on a huge array of factors, e.g., whether the employer or the employee pays or whether or not one is self-employed. For such a huge sector of the economy one would expect that there would be agreement on whether these should be pre-tax or post-tax expenses. (Personally I think it is madness to pour gasoline on the health care bonfire of cash by making the dollars spent mostly pre-tax. If an industry is consuming an outsized portion of GDP why encourage Americans to keep pouring more money into it? It is also a big hit to the tax base. The government is very careful to limit charitable deductions as a percentage of income but is allowing 20-30 percent of income, for a lot of workers, to be swept off the taxable table.)

Allowing some money managers to claim their fees as capital gains rather than ordinary income. (The “carried interest” stuff that is periodically debated by politicians.) If the point of having a long-term capital gains rate is to ameliorate the fact that inflation-driven pseudo-gains are taxed (see below) and to encourage people to invest in businesses, why give the rate to people who did not put up personal funds and who did not hold an asset long enough for inflation to be an important factor?

That capital gains are not adjusted for inflation (so we pay the same tax on an asset that doubled in nominal value over the past year and on an asset that doubled in nominal value over the past 50 years (i.e., actually lost value because of 50 years of inflation)). This will lead to some crazy behavior if we ever get back to Jimmy Carter-era levels of inflation.

That successful people who lead short lives have a much larger percentage of their income taxed away compared to people who enjoy a long life. This is because the estate tax is a second income tax, taking a cut of money that was already taxed as it was earned. (See Mankiw for how these add up.) Someone who dies during his or her working years is much more likely to pay estate tax than someone who dies following a long retirement in which savings accumulated during working years were spent. [Financially unsuccessful Americans don’t pay any estate tax, of course, because the threshold is pretty high.]

After we (permanently?) melted down our economy with a housing bubble and while we continue to melt the planet by heating and air conditioning double the number of square feet per person that we lived in during the middle of the 20th Century, we continue to subsidize expenditures on housing with the mortgage interest deduction.

Related:

• “20 Really Stupid Things In The U.S. Tax Code” (Forbes)
• Tax Foundation comparison across countries (Sweden comes out near the top, a big change from the 1970s)
• “Alternative Minimum Tax” posting from April 2014

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We are on our second state of emergency here in Massachusetts. The Boston Public Schools are shut down for two days. The MBTA shut down bus, subway, and train service at 7 pm this evening and will keep public transit shut down through Tuesday.

The former Soviet contingent of our household said “We never had snow days in Moscow.” What about the subway system? “Never stopped,” she responded. “And the buses pretty much ran all the time as well.”

Readers: Who grew up in China, Korea, or Japan? What happened to school when it snowed heavily?

Some photos:

 

 

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Harvard, like other research universities, punishes professors for spending time with undergraduates. An hour spent teaching an undergraduate is an hour that could have been spent working with a post-doc or graduate student to get a research paper or grant proposal out the door. Via a new policy, Harvard has now banned sex between consenting adult undergraduates and teachers. Thus there is truly nothing tangible that a professor can gain from talking to an undergraduate.

The Boston Globe article on the new policy talks about ethical issues, but in an era where “A is average” the traditional ethics problem of influence over grades does not exist.

To me the deeper ethical questions are why professors grade their own students (see my “Universities and Economic Growth” article) and how it can be ethical to send graduates out into the world without any independent, and therefore credible, certification of their competence. But since these issues don’t involve sexual activity, apparently nobody cares…

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We loaded the March 2014 U.S. Census Current Population Survey into a MySQL database for our students at MIT. In showing them how painful it is to calculate medians in standard SQL we discovered a larger-than-expected female/male wage gap. We limited our results to young people, age 22-36. They all had the same level of education: a Bachelor’s degree (no more, no less). They all worked at least 30 hours per week. Within the sample, men generally worked 2-6 hours more per week (e.g., 44 hours versus 40). We’re going to make the virtual machine available, probably from the Three-Day RDBMS course page if you want to poke around in the data (you can try right now from the Day 1 problems). Note that we started with a CSV file from the National Bureau of Economic Research. I’ve seen various statistics on male/female wage gaps. Supposedly the trend is that when corrected for working hours, years in the work force, education, etc., there isn’t much of a gap. This is as you’d expect from classical economics. If women were truly cheaper to employ, adjusted for skills and productivity, Target could put Walmart out of business simply by hiring only women. How does the theory translate into practice?

CPS F	CPS M	Cents/Dollar
Alabama	$40,000	$47,000	85
Alaska	$43,600	$50,000	87
Arizona	$30,000	$50,000	60
Arkansas	$42,000	$57,000	74
California	$40,000	$55,000	73
Colorado	$41,600	$45,000	92
Connecticut	$35,000	$60,000	58
Delaware	$46,000	$40,000	115
District of Columbia	$47,000	$55,000	85
Florida	$40,000	$50,000	80
Georgia	$38,000	$43,004	88
Hawaii	$43,000	$45,000	96
Idaho	$31,000	$53,000	58
Illinois	$40,000	$50,000	80
Indiana	$35,000	$43,680	80
Iowa	$38,000	$67,000	57
Kansas	$46,000	$50,000	92
Kentucky	$40,000	$45,000	89
Louisiana	$32,828	$63,000	52
Maine	$28,000	$46,500	60
Maryland	$37,000	$51,000	73
Massachusetts	$35,000	$45,000	78
Michigan	$37,000	$60,000	62
Minnesota	$45,000	$58,000	78
Mississippi	$25,000	$38,670	65
Missouri	$40,000	$50,000	80
Montana	$28,000	$40,000	70
Nebraska	$36,000	$50,000	72
Nevada	$38,000	$50,000	76
New Hampshire	$42,000	$60,000	70
New Jersey	$43,000	$53,000	81
New Mexico	$35,000	$40,000	88
New York	$47,000	$53,000	89
North Carolina	$37,000	$36,000	103
North Dakota	$35,000	$39,000	90
Ohio	$40,000	$45,000	89
Oklahoma	$30,000	$40,000	75
Oregon	$30,000	$43,700	69
Pennsylvania	$40,000	$50,000	80
Rhode Island	$40,000	$60,000	67
South Carolina	$34,000	$50,000	68
South Dakota	$38,000	$50,000	76
Tennessee	$37,000	$42,000	88
Texas	$41,400	$50,000	83
Utah	$40,000	$62,500	64
Vermont	$38,000	$45,000	84
Virginia	$40,000	$74,000	54
Washington	$41,804	$55,000	76
West Virginia	$28,000	$60,000	47
Wisconsin	$48,000	$45,000	107
Wyoming	$40,000	$55,000	73
average	77

Note that the sample size is fairly small for the CPS. There are 224 women in California in our restricted sample and 210 men, for example. So that could account for a fair amount of variance but I don’t think it can explain the overall pattern.

Related:

• August 2014 posting on whether public companies should be allowed to hire men
• December 2012 posting about the profit opportunity to be exploited if the wage gap is real
• January 2015 posting questioning whether looking at the wage gap makes sense (given that spending ability is what most people care about)

Update: In response to reader comments that some the differences might be due to marital status, I ran the queries again on the 22-36-year-old population of Americans with Bachelor’s degrees. The results were limited to people working at least 30 hours per week and earning at least $5000 per year. The median earnings of women went up from 77 percent of men’s earnings to 86.7 percent. Note that the virtual machine with all of the data loaded is available so readers can do their own poking around (given minimal knowledge of SQL).

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Sony sensors produce much better images in real-world conditions than Canons due to the roughly two extra f-stops of dynamic range (ability to record both light and dark tones in the same image). Nikon adopted the Sony sensors in its flagship D800 and similar cameras.

Canon has announced a somewhat bizarre answer to the challenge presented by the superior image quality of Sony and Nikon: the 50 megapixel 5Ds. dpreview:

As far as dynamic range is concerned, we’re told that the new 5DS and 5DS R should give the same performance as the current EOS 5D Mark III. If true, this means that the new cameras won’t be able to offer the same industry-leading dynamic range of Sony’s current APS-C and full-frame sensors, but at least it isn’t a step backwards. And hey – 50MP!

What good is 50 megapixels? The maximum resolution of this camera is 8688 pixels on the side of the image. Assuming a perfect lens, tripod, and focus technique, this means a beautiful quality enlargement to about 43 inches on a side. The Nikon D800 creates images that are 7360 pixels on the long side, thus enabling a similar quality enlargement to only about 37 inches in width.

Not planning to use a tripod, sandbag, $4000 Zeiss Otus lens, etc.? The extra megapixels likely won’t be worth much.

Short summary: If the report regarding dynamic range is true, this is another sad day for Canon EOS lens system owners.

 

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In a recent hardcopy of Rotorcraft Pro magazine there was an article about the U.S. Navy considering using AugustWestland AW119 helicopters as primary trainers, replacing paid-for Bell Jet Ranger helicopters that cost about $600/hour to operate in the civilian world. This defensenews.com article confirms the story. Each Texas-designed and Montreal-built Jet Ranger, worth about $300,000, will be replaced with a $3.5 million Italian helicopter (the AW119) that Conklin & de Decker says costs over $1000 per hour to run.

Note that when civilians learn to fly helicopters they typically do it in a Robinson R22 for about $250 per hour, including all capital costs, plus another $20-50 per hour for the instructor.

Related:

• this story about the U.S. Army spending $4000 per hour to run Jet Rangers and rejecting a civilian flight school’s offer to do it for closert o $1000 per hour.
• this story about the U.S. Army trying to do the same thing as the Navy is considering, but with $6 million twin-engine helicopters
• this newsletter showing that the Jordanian Air Force decided to use $300/hour Robinson R44s as their primary trainers (capital cost about $400,000 each)

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Friends have been asking me about TransAsia 235, an ATR 72-600 turboprop that crashed in Taiwan.

First, why a turboprop, where jet (turbine) engines drive propellers? A pure turbojet, such as a Boeing 737, burns more fuel at lower altitudes and needs more runway. So turboprops are ideal for short flights and/or flights to small airports.

Managing an engine failure in a twin-engine turbojet is pretty easy. You push the two thrust levers full forward, which gives you max thrust from whichever engine is still running. Then you use the ailerons and rudder to keep the airplane flying more or less wings level. This compensates for the torque of just one engine spinning out on one wing and prevents the plane from rolling. If the engine occurs right around takeoff, which it always does in the sim(!), you make sure that the gear and flaps are retracted so that drag is reduced. After you’ve climbed to a safe altitude you start running checklists. At high altitude airports or in very high temperatures your climb performance will be reduced but it will always be sufficient if pre-flight planning is done correctly (mostly not loading up the plane with people, bags, and fuel).

Managing a real-world engine failure in a twin-engine piston-powered airplane is beyond the skills of most pilots, leading to the adage “the second engine takes you to the scene of the accident.” There are six power levers in a piston twin. If an engine fails near the ground there is an emergency situation created by the drag of the windmilling propeller. The pilot must figure out which engine has failed and pull the propeller control lever back on that side of the plane, turning the blades of the prop into knife edges relative to the slipstream. This is called “feathering” the propeller. If this is not done, the airplane will sink because the second engine is not powerful enough to fight both gravity and the windmilling prop’s drag. If the still-running engine is feathered by mistake then a single-engine scenario is turned into a zero-engine scenario. I wrote about this in 2006 during my own multi training (“Unsafe at any speed… Philip and a piston twin”):

When an engine quits, the pilot is supposed to push up the two mixture controls, the two prop speed controls, the two throttles and then make sure that the gear and flaps are up. After that it is identify and verify the dead engine by pulling back the throttle and seeing that there isn’t any yaw. Finally one is supposed to pick the correct prop speed control from among the six power levers and pull it back to feather. I thought I’d done just this and was a bit surprised by the fact that the airplane was yawing as I pulled the lever back. I kept pulling. My instructor, Jim Henry, is normally the soul of cool and calm. He jumped out of his seat and pushed my hand out of the way. “Maybe you shouldn’t pull back the mixture on the good engine.”

Are there piston-powered twins in airline service today? Yes, Cape Air is a notable example and they have an excellent safety record due to careful hiring and an excellent training program. However for bigger planes that need more horsepower it is impractical to make piston engines that meet modern reliability standards. There were plenty of heavy powerful piston-driven airplanes during World War II, e.g., the B-17 and B-29 bombers (example engine) but a turbine engine spinning a prop is a much more practical way of generating anything more than 500 horsepower.

Turboprops are bigger, more complicated, and more expensive than piston twins so generally they include an auto-feather capability. If an engine isn’t producing power the propeller associated with that engine will automatically be twisted to a low-drag knife-edge position. The historically popular Beech King Air, for example, has this feature, which has contributed to its excellent safety record relative to similar-size twins that don’t auto-feather. The “engine failure after lift-off” procedure (online checklist) for the King Air is pretty similar to what one would do on a turbojet (max power both engines, flaps/gear up, clean-up after reaching a safe altitude).

The Guardian says that a dead engine on the ATR 72-600 will auto-feather (but then the article gives an incorrect explanation of feathering as “reduced thrust to the propeller”) and this is confirmed by some information for flight simulator enthusiasts that I found online. So it is unclear at this point why the pilots were doing anything with the engine controls other than pushing them full forward so that could concentrate on flying the airplane.

A friend asked about the pilots’ thousands of hours of experience and recurrent training. Depending on the carrier and their agreement with the FAA or local equivalent, airline pilots get recurrent training every 9-12 months. For an airliner this means simulator training. The New York Times said that the pilots had 5000 hours and 7000 hours of experience. An airline pilot typically flies about 1000 hours per year. Initial sim training on single engine procedures might last for 15 hours. Recurrent training might be just 5 hours of single engine work. So a pilot with 7000 hours of total time potentially would have only about 50 hours of experience in flying the ATR 72 on one engine.

Too soon to say definitively what caused this accident, but as background for understanding the news, keep in mind the best thing that a pilot can do in the event of a single-engine flame-out in an otherwise properly functioning ATR 72 is basically nothing. Contrary to Hollywood portrayals doing nothing is the best course of action for a lot of in-flight issues (for example, everyone on Air France 447 would be alive today if the pilots had sat in their seats with arms folded for a minute or two).

Related: the crash of Atlantic Southeast Airlines Flight 529, in 2001. The propeller itself failed and could not be feathered. The achievements of the crew, pilots Ed Gannaway and Matt Warmerdam and flight attendant Robin Fech, were chronicled in a superb book: Nine Minutes, Twenty Seconds (also a great audiobook).

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“Your Son Is Deceased” is a February 2, 2015 New Yorker article about two police officers shooting a somewhat unbalanced young man at his parents’ house. They then surrounded the empty house with military hardware:

There were more than forty police vehicles on his street. Officers wearing camouflage fatigues and bulletproof vests had circled his home, a sand-colored two-story house with a pitched tile roof. Two officers were driving a remote-controlled robot, used for discharging bombs, back and forth on the corner.

In addition to paying for this army of police power, the taxpayers of Albuquerque also had to pay the family $6 million after they sued the city for the wrongly death of Christopher Torres (KRQE story).

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