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A couple of recent items from the New York Times:

• Gregory Mankiw calculates the total tax rate on $1,000 in 1099 income put aside for a child’s future; with federal income tax, Medicare tax, state income tax, corporate tax, dividend tax, and estate tax, the government collects about 90 percent
• New York state facilities for naughty teenagers cost $220,000 per kid per year ($600/day, or enough to send the kid (along with a friend or two) to the Four Seasons resort of his choice), except when the cost is infinite because the state continues to pay 80 employees at a facility that no longer houses any kids at all.

Mankiw adds some evidence to my theory that competent politicians will extract the maximum amount of taxes that a given economy can produce. When people say, for example, that a particular tax in the U.S. could be higher, my response is that their suggestion is offensive to professional politicians. If there were more blood that could be squeezed from Americans overall, it would already have been collected. Sadly we have let our politicians down to some extent by not building an economy sized appropriately for Medicare, public employee pensions, Social Security, government worker salaries, our various foreign wars, etc. Our politicians’ confidence in us was misplaced. But that doesn’t mean that more could be collected overall from the American people that they are actually stuck with.

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The town sent me a property tax bill today. The value of the house is down about 7 percent, reflecting the continued collapse of the U.S. private economy (Massachusetts does not benefit that much from the general expansion of the federal government, from TARP, or from the Detroit automaker bailouts). Even the Millionaires for Obama (the neighbors) aren’t prospering in the Obamaconomy. How about the tax owed? It is up about 7 percent, reflecting the pay raises of local schoolteachers, policemen, and firefighters as well as the continued rise in the costs of health care for public employees as well as the rising cost of pensions and health care for retired public employees.

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New Jersey’s Governor Christie has been assailed lately for canceling a proposed railroad tunnel because the cost estimates have grown to between 11 and 14 billion dollars (source). None of the newspaper articles that I’ve seen on this story, however, have compared the cost of this tunnel to others around the world. Here are the data that I wish the journalists had pulled from Wikipedia:

• Lotschberg Base Tunnel, world’s longest land tunnel, dug under a mountain at the peak of the world economic boom and completed in 2007; 21.5 miles long, about $4.5 billion (might be 1998 dollars, though); cost per mile: $209 million
• Gotthard Base Tunnel, when completed in 2017 will become the world’s longest railway tunnel; at least 35.4 miles plus additional tunnels, shafts and passages totaling 94.3 miles, about $10.2 billion; cost per mile: $288 million
• Channel Tunnel or “Chunnel”, connecting France and England, world’s longest undersea tunnel; 31.4 miles, opened 1994, cost $7.4 billion (might be 1985 dollars and the cost overruns did lead to bankruptcy); cost per mile: $235 million
• Wushaoling Tunnel, traveling through four regional fault zones; 13 miles long, opened 2006, cost $845 million; cost per mile: $65 million
• New Jersey-New York Mass Transit/ARC Tunnel, scheduled for completion in 2018; 3.5 miles long, cost $11-14 billion; cost per mile: $3.7 billion (I used $13 billion for this calculation)

Are folks in New Jersey rich enough to pay 15 times as much per mile of tunnel as the Swiss? Or 57 times as much per mile as the Chinese pay? New Jersey has high income now (2nd in nation), but Forbes suggests that New Jerseyans will not be especially wealthy in 2018 if present trends continue. New Jersey has some existing fiscal problems that led to its being the first U.S. state charged with fraud by the federal Securities and Exchange Commission (SEC site).

To me the most interesting part of this story is why newspapers couldn’t be bothered to calculate the cost per mile of this project. A Google News search for ‘new jersey tunnel “cost per mile”‘ yielded no results (“new jersey tunnel” yielded 689 results). The New York Times article mentions the number of jobs that the government forecasts would be “created” (the accounting doesn’t make sense to me because they did not subtract the number of jobs that would be lost due to taxpayers having $13 billion less to invest and spend) and a bunch of other estimates. In a situation where the main debate is about whether or not something is too costly you’d expect a newspaper to include some facts about what similar projects have cost worldwide.

[The data from other tunnels is a little bit confusing since there are varying numbers of tracks and holes through the Earth. The Chunnel, for example, is really two single-track tunnels plus an additional “service tunnel”. The Lotschberg Base Tunnel is currently a mix of double- and single-track capacity. The Gotthard Base Tunnel is two tunnels with one track each (no “service tunnel”).]

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Those of us who’ve been participating in Internet discussions for decades (me since 1976), starting in the identified days of ARPAnet and now in the potentially anonymous or pseudonymous mud-slinging days of Internet, associate the technology with a certain amount of incivility (see http://en.wikipedia.org/wiki/Flaming_(Internet) for example).

My friend Kyle took me out dinner this evening at No. 9 Park, an extremely civilized venue. She works in the health care industry where it is conventional to have 100-person conference calls. She said “I’ve learned that you never ask a question of the group. The answer always comes from an angry crazy person.”

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I went to see The Social Network this evening.

The movie starts out with Mark Zuckerberg, the Facebook founder, in a bar with his girlfriend from Boston University, Erica Albright. This struck an off note for me because the typical Harvard undergrad needs a passport to leave Cambridge. The idea that an introverted computer programmer at Harvard would have a girlfriend at BU, other than perhaps someone he had known from high school (the dialog makes it clear that they did not meet in high school), is almost absurdly unlikely.

The next scene in the movie has Zuckerberg bringing down the entire Harvard University network by building facemash.com, a site that let users rate undergrads’ appearance. The site got 22,000 page views within four hours (or perhaps it was 22,000 photo views), each page view consisting of some text and a couple of photos, and this supposedly brought down Harvard’s 2003 network, capable of transferring physics data sets and streaming video. (For comparison, in 1999 America Online’s Web servers were responding to 28,000 file requests… every second.)

[It was possible in the olden days to slow a network down with user activity. I personally slowed down a corporate network by developing a popular multi-player SpaceWar game that required peer-to-peer synchronization, but that was in 1983 and the network was a single coax cable running old-school Ethernet (10Base5!) among about 100 Symbolics Lisp Machines. The game was banned by company executives.]

The portrayal of Harvard students and Facebook programmers as persistently drunk seemed hard to reconcile with the dreary realities of keeping a bunch of MySQL servers running and indeed the movie’s initial focus on technology shifts to a focus on interpersonal dynamics. We don’t learn much about what it felt like to build the company or add features to the service.

Former students often ask me what I think of Facebook. Many of them are just a little older than Zuckerberg and they say “Philip: you built all of those features in the 1990s. You taught a whole course on how to build online communities. How does it feel to see this guy make billions of dollars without having to do anything innovative?” My response is that I didn’t envision every element of Facebook. I imagined only three levels of publication: private (email), public (Web site), and community (on a Web site accessible only to other registered users of a site such as photo.net). I never had the idea of limiting information based on a network (though on photo.net we did have a “friends” feature starting in 2000 where contributions to the overall community by particular users marked as interesting would be highlighted to the person who’d selected those “friends” and that information would be displayed in reverse chronological order).

Zuckerberg seems to have done everything that the early Internet nerds suggested doing, e.g., starting with a relational database management system, watching user behavior carefully and refining the site’s feature set, providing mechanisms for users to connect and discuss. It was our generation’s job to show his generation how to do stuff, so we did our job and he did his.

My favorite part of the movie experience was a character who says that his girlfriend is “jealous, crazy, and frightening”. I nudged my companion and said “Wow, she’s just like you!” Seconds later the girlfriend says “How come your Facebook page says that you’re single?” My companion had in fact uttered these very words back in 2007 and in much the same tone of suspicion and indignation. I explained that I had set it up back several years ago after being invited by some students and didn’t use Facebook except to acknowledge friend requests. If it made her unhappy I would change the status to “married” and did so. This led to a flurry of congratulatory emails from surprised friends. To each one I had to respond that I had only changed the relationship status in order to quell criticism and there had not been any wedding. That’s when I realized that Facebook was more than simply a diversion for college undergraduates.

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Friends sent me two links today:

• “20 government workers with super-sized pay” (my favorite is the prison dentist who earns $621,000 per year drawn from tax money extracted from Californians who have to drive to Tijuana to get dental care that they can afford)
• animated video with Fullerton, California fireman

Feel better about your job!

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Voting in Massachusetts is generally an uninteresting activity where the Democrat always wins and spending always ratchets upward. This year there is one interesting technical proposition on the ballot, a proposal to repeal an obscure “affordable housing” law that has yielded billions of dollars in subsidies and profits for developers. The folks behind this have a Web site at http://www.affordablehousingnow.org/. I surveyed the Millionaires for Obama in my neighborhood and they were generally in favor of repealing the law (“yes” on 2), which keeps towns perpetually in fear of falling below a state threshold for the percentage of units that are “affordable”. Once a town falls below this threshold, a developer can apparently buy a 5-acre lot and put up a 200-unit condo without regard to local zoning laws. The developer can apparently draw on taxpayer funds to finance his 200-unit condo as long as a small fraction of the units are sold relatively cheap (apparently a high percentage of the folks who get to buy the cheap units turn out to be friends and in-laws of the developer). If the project fails, the taxpayers are stuck with the loss. If the project succeeds, the developer collects the profit.

One bizarre aspect of the law as it has stood for some years is that the counting is done separately in each of the approximately 350 towns and cities (http://en.wikipedia.org/wiki/List_of_municipalities_in_Massachusetts ) of the state. Instead of putting a pin in the map on top of an employer and asking “What’s the chance that a person could find an affordable place to live within a reasonable commuting distance of this employer?” the question is asked “What if someone really wants to live in Acushnet or Tyringham?” If a formerly compliant town were to split into two separate entities, it is quite likely that the law would kick into action because one of the two new towns would have a surplus and one would have a deficit of affordable housing. Despite the fact that nothing had changed from the perspective of an individual, millions of dollars in taxpayer-funded subsidies and lucrative zoning exemptions would begin to flow automatically.

Discussing the proposition made me reflect on whether affordable housing is an achievable goal independent of economic prosperity. Much of the cost of building a house is in materials whose prices are set on the world market by demand from successful growing economies, such as China and Brazil. If a country has a growing population and a shrinking or stagnant economy, inevitably housing is going to become less affordable for the average worker. A job that formerly was sufficient to afford a two-bedroom apartment will now be sufficient only to pay for a studio apartment or perhaps to share the two-bedroom apartment with another worker. What purpose is served by funneling hundreds of billions of dollars (nationwide) into subsidizing housing? Wouldn’t an American be better off in the long run with a smaller simpler house and a larger set of skills and better education? If so, why not put the money that we’re currently spending on affordable housing into free educational materials for the Web and into subsidized educational programs? (Assuming that returning the money to taxpayers is too radical an idea for any politician to propose.)

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This 2006 scientific biography of Andre Geim, who shared the Nobel Prize in Physics this year, is interesting partly because of Geim’s refusal to stick to his Ph.D. topic in an attempt to get tenure. In the U.S. at least, universities generally restrict tenure to those who are “leaders in their field”, which is tough to achieve if you’ve only worked in a field for a few years. American universities thus tend to penalize the most creative professors since only the plodders are willing to stick with the same narrow topic for 6 years of Ph.D., 2 years of post-doc, and 6 years of assistance professorship.

[Geim’s success in Europe and England does not necessarily show that their systems are necessarily more congenial to the creative than ours, of course. More likely is that he was simply recognized as exceptional.]

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I’m heading out to Las Vegas for a few days in the middle of this month, moving on to Seattle afterwards. It would seem that a certain Border Collie has not made enough friends in his 15 weeks on the planet to find a congenial berth in the Boston area, so the beast is going to get an introduction to desert life.

Some questions for readers…

• good dog-friendly hotel in Las Vegas? I don’t want something on the Strip due to its concrete wasteland aspect and the fact that it can take 15 minutes to get from one’s room to the outdoors (one option: Lake Las Vegas)
• good activities to do with a dog? Dog parks? Trails?
• good options for pet-sitting in Vegas in case I want to park Ollie the Collie for a few hours?
• and all of the same questions about Seattle.

Thanks in advance.

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I just finished Freedom by Jonathan Franzen and am putting some notes here so that I can refer to them at a neighbor’s book club meeting.

The writing deftly captures the spirit of several different decades and when a scene is set in the 1970s or 1980s it seems realistic. Most novelists, e.g., Tolstoy, seem to love their characters. One of the reasons the typical novelist spends so much time writing a book is that he or she is enjoying spending time with the characters. With Franzen one gets the opposite impression. He seems to have contempt for his characters, despite any virtues they might have. If he spent time with them scribbling out 576 pages it is perhaps because he enjoyed feeling superior to all of them.

The novel has a couple of unconventional features. One is that two sections are supposedly diary excerpts by a female character. This is not convincing because the female character writes exactly like… Jonathan Franzen. The second unconventional feature is that Franzen introduces some characters within the last 1/6th of the book. They feel like afterthoughts and why do we want to invest time learning about them when the book is about to end?

One aspect of modern-day American life that Franzen captures is the pervasiveness of government regulation and war in our economy. None of the characters make money by working in a widget factory. One guy is involved in a very lucrative deal that hinges on obtaining government approval to do mountain-top removal mining. Another character is making obscene profits selling junk truck parts to the U.S. forces in Iraq; this would have seen implausible if I hadn’t read Imperial Life in the Emerald City. Others work directly for the government or for non-profit organizations.

According to Wikipedia, Franzen spent his childhood in the Midwest, his college years at an elite liberal arts college outside of Philadelphia, and his adult years in New York City and Santa Cruz, California. For some reason, the novel calls for one character to be an in-your-face racist. He approaches a Caucasian guy having dinner with an Indian-American (South Asian) girl and walks right up to the guy saying “Like the dark meat, do you?” and “I seen what you doing with that nigger girl.” Is the scene set in any of the places that are familiar to Franzen and his friends? No. It happens in a restaurant in West Virginia. The scene doesn’t seem credible to me based on my many trips through West Virginia. Maybe in a fighting bar among drunk patrons at 1 am, but not at 7 pm in an Applebee’s. Perhaps a patron might think an unkind thought about a couple with different skin colors. Perhaps a couple with different skin colors might get some unwelcome stares, but a racist walking right up and saying “nigger” is simply not part of the Applebee’s experience, even in a small town that a fancy New York/California-based writer might regard as benighted.

The book seems well-crafted rather than clever or delightful. A lot of the main characters’ motivations do not seem credible. There is a saintly middle-aged guy whose wife has been depressed for years and sleeps in a separate bedroom. Yet he resists sleeping with his willing 27-year-old beautiful assistant who happens to live in the same townhouse. Franzen and his publicists have been hyping this as the Great 21st Century American Novel, but it falls well short of the standards set in the 20th Century by An American Tragedy and Edith Wharton’s Novels. Let’s hope that the 600 million or so folks who inhabit the U.S. in 2100 can do better (see Census Bureau report for “middle series” estimate of 600 million or so and a “high series” estimate of nearly 1.2 billion).

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