Climate change summit will require 1200 limos and 140 private jets

An article on the carbon footprint of the Copenhagen climate summit: “1,200 limos, 140 private planes and caviar wedges”. My favorite quotes:

“We haven’t got enough limos in the country to fulfil the demand,” [a limo company manager] says. “We’re having to drive them in hundreds of miles from Germany and Sweden.”

The airport says it is expecting up to 140 extra private jets during the peak period alone, so far over its capacity that the planes will have to fly off to regional airports – or to Sweden – to park, returning to Copenhagen to pick up their VIP passengers.

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Arson Investigation

Down in Orlando for some flying lessons, I’m catching up on my New Yorker magazines. One article that I missed is “Trial by Fire” from the September 7, 2009 issue. It discusses the process of arson investigation in the context of a fire at the home of Cameron Todd Willingham. The fire killed Willingham’s three young children and he was sentenced to death for the crime. The most surprising part of the article was how the standard process of arson investigation was found to be mostly flawed in the early 1990s. An investigator decided to see whether an accused arsonist was telling the truth by reconstructing a similar house and its contents, then setting fire to a couch. The case against the arsonist was dropped when the test house burned exactly like the crime scene house (more), without benefit of the gasoline that the original experts had concluded must have been used to accelerate the fire.

More: read the article.

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Mountains Beyond Mountains

Prompted by a 16-year-old friend, we’ll call her “Stacy”, I recently finished reading Mountains Beyond Mountains, a Tracy Kidder book that was excerpted in New Yorker magazine some years ago. Jeff Sachs and Peter Singer sit in comfort in the U.S. and say that other people really should do something to help the world’s poor. The subject of the book, Paul Farmer, is the rare American who has dedicated his life, no questions asked, to helping those in need, specifically those who are sick, regardless of how inconveniently located they are.

The book chronicles Farmer’s journey from a childhood spent in a converted bus parked in a Florida trailer park to Duke University on scholarship, to Haiti and Harvard Medical School, and eventually to a life floating among the world’s airports, clinics, and conferences. Through hard work and force of personality, Farmer has managed to build a modern clinic in a remote and desperately poor corner of Haiti. He has revolutionized the treatment of drug-resistant tuberculosis in Peru and Russia. The book, published in 2003, does not chronicle Farmer’s successful foray into HIV therapy for Rwandans.

Stacy was inspired by this book and other chronicles of Dr. Farmer’s achievements. I, on the other hand, could not imagine enduring the sacrifices described in the book: filthy food, Hepatitis A, all-day walks in stifling heat and humidity to reach patients in villages without road access, millions of miles of commercial airline flights, and hardly ever seeing his wife and children (who live in Paris). If this is what it takes to change the world, then don’t hold your breath waiting for change, because there probably won’t be another guy like Farmer in our lifetime.

Farmer and Kidder share a political philosophy up to a point. Farmer believes that it is immoral for someone to earn a fat salary and then spend it all on himself rather than living modestly and donating the surplus to the poor. Kidder states that Haitians are poor because it is to the advantage of powerful Americans and rich Haitians to keep them poor and illiterate. Somehow there are guys in Washington and New York who get richer as a consequence of Haitians getting poorer. Due to indifference if not hostility towards the peasantry, the government of Haiti has shirked its responsibility to build roads, educate the inhabitants, provide jobs, deliver drinking water, etc. Neither Kidder nor Farmer consider whether it would be feasible for the best-intentioned group of bureaucrats to bring prosperity to Haiti. Haiti is home to 9 million people in a country the size of Maryland, which makes it the most densely populated country in the Western Hemisphere (source). The per-capita GDP is $800 per year. Individual Haitians have cut down all of the forests and burned them or used them for building materials. If you wanted to create a case study to prove Jared Diamond’s points in Collapse, it would be hard to construct a better example than Haiti. The land supported a modest population of Taino Indians very nicely, but it could not support 9 million humans even if the natural resources were intact. If you distributed Haiti’s wealth equally among all Haitians, they would still be among the world’s poorest people.

How would a government collect tax revenues from people who are subsistence farmers? Who would want the job of running a government in Haiti? Haiti is so poor that the traditional dictatorial approach of stealing from the common people isn’t practical. It turns out that the only people who have been interested in the job recently were those who figured out that they could siphon off foreign aid dollars. Only a saint would be willing to take on the project of governing honestly and, in fact, Haiti was governed for a time by a Catholic priest, Jean-Bertrand Aristide. Folks’ initial optimism faded when the man’s earthly nature took over. The priest succumbed to the temptations of women and took a young American wife, Mildred Trouillot. Then he allegedly started pocketing millions of dollars in foreign aid (perhaps the wife needed to return to her native New York City to shop, thus proving the old adage that “Behind every successful man is the woman who made it necessary”). Now he lives very comfortably in South Africa with Mildred and their two daughters.

Where Farmer and Kidder part intellectual company is on a trip to Cuba. Farmer thinks it might be the world’s best country because everyone has equal access to high quality medical care (Cuba has 6.4 doctors per 1000 people; the U.S. has 2.4). Farmer acknowledges that Cuba is poor, but he blames that fact on the U.S. Kidder won’t go along with Farmer’s unqualified admiration for Fidel Castro and Che Guevara (a doctor who loved to personally execute traitors to the cause), but his opposition seems mostly based on prejudice against a country labeled “Communist.” Kidder does not find anything specific about Cuba to criticize. Neither Farmer nor Kidder pointed out that Cuba might be doing better than Haiti partly because it has more than three times as much land per person, a big advantage in a primarily agricultural economy (Cuba’s population growth rate is 0.23 percent per year; Haiti’s is over 1.8 percent). Farmer relaxes in Cuba, partly because he cannot get Internet access to retrieve his hundreds of importuning emails; Kidder blames this on the U.S. trade embargo. More importantly, there aren’t a lot of sick people waiting for treatment. “I can sleep here,” Farmer said. “Everyone here has a doctor.”

As with many non-fiction works, the complete book is less powerful than the shorter New Yorker article. The magazine article followed Farmer to Haiti where he was making a huge difference in one region. The book has him bouncing around a dozen countries, each of which has seemingly intractable problems and people dying due to insufficient and/or improper medical care. Farmer in the article is the hero of thousands of Haitians; Farmer in the book is bailing out the ocean with a teacup. After reading the article one thinks “That desperately ill Haitian kid walked out of the clinic”; after reading the book one thinks “With no education or skills, how is that Haitian kid ever going to get a job?”

I thought that perhaps I was being too cynical. Stacy, after all, is ready to dedicate the 80-or-so years she has left on this planet to helping the unfortunate. Perhaps her friends and hundreds of thousands more from her generation feel the same way. I asked. “Most of them are too busy nagging their parents to buy them cars.” Cars? Aren’t her friends mostly teenagers who live in Manhattan? What kind of cars? Where would they keep them? Where would they drive? “They get Lexus convertibles. Their parents pay $550 per month for a garage space. They drive to the Hamptons on some weekends.”

[If your teenager can manage without a Lexus, you can feel confident donating money to Partners in Health, Farmer’s non-profit organization, which spends roughly 95 percent of its money on program services. PIH has been selected by Bill and Melinda Gates for some large grants, and is rated highly by GiveWell. The org’s Form 990 for 2008 reveals that Farmer himself received no salary (he gets paid separately as a Harvard Med School professor and physician). The CEO of the $52 million/year organization received less than $75,000 per year in total compensation (compare to Carnegie Hall or WGBH); the highest paid employees earn between $67,000 and $80,000 per year.]

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Investors are less afraid of Iran …

… than they are of the U.S. Congress. That’s the conclusion that I draw from two Wall Street Journal articles: “Crisis Spurs Migration to Israel” and “Building Peace Without Obama’s Interference”. Despite the threat of a devastating nuclear attack from Iran, which would presumably reduce the value of any investment to zero, the Israeli economy has lower unemployment than the U.S. and strong economic growth. The West Bank Palestinian economy is doing even better, with a Chinese-style growth rate estimated between 7 and 11 percent. What does it say about the regulatory and tax environment here in the U.S. that an investor would rather build a factory in a war zone?

Separately, the WSJ has an interesting opinion piece explaining why low interest rates may be hurting U.S. companies’ ability to get capital:

“the Fed is still promising near-zero interest rates for an extended period and buying over $3 billion per day of expensive mortgage securities as part of a $1.25 trillion purchase plan. Capital is being rationed not on price but on availability and connections. The government gets the most, foreigners second, Wall Street and big companies third, with not much left over.”

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Pouring more American lives and money into Afghanistan

Barack Obama gave a speech last night proposing to grow the U.S. troop presence in Afghanistan from 70,000 to 100,000 and the amount of spending from roughly $70 billion per year to close to $100 billion (excellent nytimes.com graphics). The Afghan GDP in 2008 was $11.7 billion (source). In other words, we will be spending 8X the total Afghan GDP on our nation-building efforts in Afghanistan. Per my earlier posting “Who finances the Taliban?”, some percentage of whatever we spend in Afghanistan will inevitably find its way into anti-American hands. If, for example, 5 percent of our spending found its way into Taliban and Al-Qaeda’s coffers, that would be sufficient to pay 40 percent of the Afghan population to take up arms against us, i.e., virtually every man of military age.

Here is my summary of the transcript of Obama’s speech:

  • Afghanistan has been an important training ground for Muslims who have attacked Americans
  • Pakistan is also been a place where angry Muslims can do whatever they want, including plan attacks on Americans
  • The U.S. will do whatever it takes to prop up the corrupt, unpopular, and incompetent government of Afghanistan so that the local police and military will kill or imprison angry Muslims before they can arrive in the U.S.
  • The U.S. will scale back this effort starting two years from now

The speech raises more questions than it answers. If an unlimited number of Muslims can train and plan attacks on Americans in Pakistan and there are no practical restrictions on an anti-American Afghan emigrating to Pakistan, what difference does it make whether or not we turn Afghanistan into some sort of pro-U.S. client state? [let’s ignore for the moment the fact that there are plenty of other countries in the world where an angry Muslim can plan Jihad, including right here in the U.S. in the case of Major Nidal Malik Hasan] If the Afghan government became suddenly honest, popular, and competent, why would it imprison Muslims who are anti-American? Is it against the law in Afghanistan to hate Americans or to plan violence against Americans outside of Afghanistan?

I have been reminded of the lyrics of the classic Vietnam-era Jazz song “Compared to What“: “The President, he’s got his war; Folks don’t know just what it’s for”.

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Bending Over for Microsoft

In the interest of serving my Weblog readers, I decided that I could not live another day without Windows 7. From a Dell XPS 420 with its preinstalled completely legitimate Windows Vista I purchased an upgrade to Windows 7. The software downloaded itself and installed after I answered a handful of questions that required a moderate amount of computer experience. When the machine rebooted for the last time, after about four hours of downloading and hard drive grinding, it demanded an authorization code, which the dialog box helpfully suggested might be on the side of the PC.

After bending down to the floor and flipping the PC on its front, I found a sticker on the back, printed in a font size that would be readable by the average teenager. I copied 25 letters and numbers from the sticker and then typed them into the dialog box. The code was “invalid”. I went back down to the floor and copied a second set of letters and numbers, these supposedly for the TV portion of the operating system. I typed these in. They were valid.

One question remained: if Microsoft could verify that the Windows Vista installation was authorized, how come it couldn’t transfer that over to the Windows 7 installation?

Usage report: Google Chrome works.

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Day of government regulation

I spent the early morning at our town hall paying property tax, about 33 percent more than last year, which brings the cost of property tax up to about half of what the house would rent for. I had a discussion with the assessor about why our basement has doubled in value since last year and why the rotting detached garage has appreciated almost as much.

I spent the late morning affixing previously purchased annual registration stickers to our airplane and helicopters at Hanscom Field. These are required by the Massachusetts Aeronautics Commission, recently reorganized into the Registry of Motor Vehicles. I spent the afternoon driving to a U.S. Department of Transportation certified drug testing lab where I underwent an alcohol and drug test (drive time was about one hour round-trip; wait time was 45 minutes; test time was about 10 minutes). The lab promised to forward the results to the person in charge of our drug testing program… i.e., me. We do a handful of sightseeing rides around Boston every year, which means that all pilots and mechanics are required to be on a random drug-testing program. As far as I know, there has never been a crash of a commercial aircraft that was attributed to a pilot or mechanic being on drugs; the regulation was put in place about 20 years ago for millions of workers in all forms of transportation.

I spent the evening on the phone with Medco, a prescription drug insurance provider. One of the benefits of living in Massachusetts is that it is illegal to pay for health care, at least unless you’ve already paid for health insurance that you would expect to cover that care (though it seldom does). A woman, let’s call her “Donna” to preserve medical privacy, had previously attempted to get a prescription filled at CVS for her infant. The pharmacy demanded $40 instead of the usual $5 co-pay because Medco had denied coverage. The dosage was too high. A 35-minute phone conversation ensued between Donna, Medco, and the pharmacist. Medco would not pay because the dosage was over their daily limit. It was coming up on time for a refill, so I decided to take on the challenge of getting Medco to pay up. I called up a wonderfully intelligent and helpful claims representative. He first explained that Medco provided all of its customers with an easy-to-understand formulary. If I had a copy I would surely see the dosage limit plainly written out. I responded that I did not have a copy. He referred to his own copy. “This is very confusing and I can’t figure it out. Let me get a pharmacist on the line.”

It turns out that Medco employs numerous pharmacists who never dispense drugs to patients. Their only job is to sit in an office and figure out how various rules and regulations apply to whether or not their employer will have to pay for a prescription. The first pharmacist figured out that the limit was quite low, about one quarter of what the pediatrician had prescribed. How could this make sense, I asked, when the drug was prescribed by weight and was taken by people from infancy through adulthood. “You’ll have to file an appeal with the plan administrator who came up with the formulary,” said the Medco folks. The claims representative thought this answer did not make sense, so he decided to talk to a different pharmacist in another branch of the company. The second pharmacist explained that the computer system wasn’t advanced enough to figure out how much an infant should be taking by age so they put in an arbitrary limit for the drug. Whenever it was prescribed to a young patient, the pharmacy filling the prescription was supposed to call a special help line and learn how to put in an “age override”.

The phone call lasted approximately 30 minutes, including a lot of hold time waiting for pharmacists.

Soon this kind of experience will be required by federal law for every American (though it may be unconstitutional according to this article; my personal argument would be that dealing with insurance companies constitutes cruel and unusual punishment and requiring it is therefore unconstitutional). I wonder if politicians are enthusiastic about health insurance because none have ever tried interacting with an insurance company. Surrounded by interns, assistants, and a non-working spouse, and provided with the most comprehensive coverage imaginable, a Senator could be excused for thinking that health insurance is as simple as car insurance.

How much business did we lose at the helicopter branch of the flight school because we had to comply with all of these regulations? None. Due to the state of the economy, we didn’t have any customers. Maybe I should thank the government for giving me something to do…

[I mentioned the Medco story to a doctor who runs clinics in Haiti, Peru, and Rwanda. “That’s a generic drug,” he responded. “Been around for 40 years. We pay about 1 cent per pill. You were having a discussion about less than 50 cents worth of medicine.”]

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Life Will be Even More Unfair with Cosmetic Surgery Tax

Suppose that you were fortunate enough to be born beautiful. You’ll be able to date, sleep with, and marry pretty much whoever you want. People, especially those of the opposite sex, will be happy to listen to you prattle on about whatever you’d like to talk about, whether or not you’ve studied the subject. As a consequence of your beauty, you’ll earn between 5 and 12 percent more money (example study).

With improved medical technology, however, ugly people have been gradually gaining some options for closing the gap. By working harder and saving some money, a plain or old-looking person can visit a plastic surgeon and improve his or her romantic, social, and career prospects.

Now the federal government proposes to further hobble the unattractive by taxing cosmetic surgery (nytimes). Could this be the unkindest cut of all?

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Sikorsky’s Chinese factory starts producing

According to this Aero-News.Net piece, Sikorsky’s Chinese partner has just produced its first S-76 airframe. This is one of the most sophisticated American-designed products, a helicopter that costs close to $12 million and faces little competition due to engineering and regulatory barriers. For the past 30 years it has been produced exclusively in the U.S. The Chinese announcement comes on the heels of Sikorsky’s major investments in Poland, where factories are producing Blackhawk helicopters for the U.S. Army (more).

I’m wondering whether Sikorsky’s offshore expansion should make us think a little harder about what it will take to restore our manufacturing economy. Rust Belt states have millions of surplus workers. A Sikorsky helicopter faces less competition than almost anything else that we make and labor costs are a relatively small part of its retail price. Sikorsky’s manufacturing operations are subject to FAA regulation, which is easier to deal with when nobody has to get on a plane to Asia or Europe.

If Sikorsky does not want to set up shop in Michigan or Indiana, or expand its existing operations in Connecticut and Florida, why would we expect any other manufacturer to do so?

An alternative statement of the same facts would start with the observation that an American is unemployed when no company believes that, in the current regulatory and tax environment, it is possible to hire that person and make a profit. The American will become employed when he or she gets more education and skills, when the regulations and tax rates change, or when the global economy booms so much that every qualified worker in a foreign country has already been hired. Our government is not doing anything significant with education. Our government is making the regulatory and tax environment harsher for business. Thus we can infer that the government is counting on a global economic boom and an exhaustion of the supply of workers in other countries, which effectively means that whether or not the U.S. employment situation improves is primarily controlled by foreigners.

[A second example is EMC choosing to invest $1.5B in India rather than near its headquarters in Massachusetts (press release).]

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