28.2.17

NUBBELVERBRENNUNG.

This year, from a saloon called Gleis 7.


The Nubbel gets an unusual send-off.  Watch!

It's the custom in these events to send up Established Institutions, such as the Church, and sometimes the Military.  I bet the videos that pop up later tonight and into Lent will have more than a few send-ups of Our President.

COMPETITIVE MARKETS ALLOCATE RESOURCES EFFICIENTLY.

This tribute to the recently departed Kenneth Arrow, at A Fine Theorem, clarifies how restrictive the sufficient conditions for emergent Pareto efficiency are.  I'll even cut the author some slack for believing in the Fatal Conceit.
My read of the literature on [general equilibrium] following Arrow is as follows. First, the theory of general equilibrium is an incredible proof that markets can, in theory and in certain cases, work as efficiently as an all-powerful planner. That said, the three other hopes of general equilibrium theory since the days of Walras are, in fact, disproven by the work of Arrow and its followers. Market forces will not necessarily lead us toward these socially optimal equilibrium prices. Walrasian demand does not have empirical content derived from basic ordinal utility maximization. We cannot rigorously perform comparative statics on general equilibrium economic statistics without assumptions that go beyond simple utility maximization. From my read of Walras and the early general equilibrium theorists, all three of those results would be a real shock.
Repeat with me: there is no such thing as an all-powerful planner.  That noted: existence of competitive equilibrium follows from a narrow set of sufficient conditions.  Uniqueness and stability of that equilibrium: harder still.  On the flip side, the absence of the sufficient conditions does not lead inexorably to a set of circumstances where Someone In Authority (not necessarily an all-powerful planner) can find a Pareto improvement.  It's even hard in the presence of the sufficient conditions.
This is literally the main justification for the benefits of the market: if we reallocate endowments, free exchange can get us to any Pareto optimal point, ergo can get us to any reasonable socially optimal point no matter what social welfare function you happen to hold. How valid is this justification? Call x* the allocation that maximizes some social welfare function. Let e* be an initial endowment for which x* is an equilibrium outcome – such an endowment must exist via Arrow-Debreu’s proof. Does endowing agents with e* guarantee we reach that social welfare maximum? No: x* may not be unique. Even if it unique, will we reach it? No: if it is not a stable equilibrium, it is only by dint of luck that our price adjustment process will ever reach it.
There are some subtleties involving separating hyperplanes that the reader must understand, before giving up on the case for rearranging endowments.  But "main justification for the benefits of the market?"  It's probably harder than that: has anyone come up with a set of sufficient conditions under which Partially Informed Wise Experts achieve an allocation of resources that is Pareto-superior to an allocation of resources that Partially Informed participants in a distributed network reach.  Impound nonconvexities, including externalities and club goods, in ceteris paribus and tell me what you come up with.

A FOOL'S ERRAND.

Flatlanders escaping to Wisconsin will have to deal with construction-related congestion along Interstates 90 and 39 between the Cheddar Curtain and Madison this waterpark season.
According to the latest version of the Department of Transportation's road construction schedule, more than half of the 45-mile stretch of Interstate between Beloit and Madison will be torn up at times as 10 major projects are set to roll out.

That work, according to plans the DOT showed The Gazette, will include overpass replacements between Janesville and Madison and a 10-mile expansion of the Interstate's northbound lanes starting north of Edgerton.

Thus would begin the long-awaited—or some might say, long-deferred—expansion of I-90/39. The massive $1 billion project aims to widen I-90/39 from four lanes to six from the state line north to Madison—and beef it up to eight lanes through Janesville.
The usual spinners will deal in the usual spin about a little inconvenience now for a faster trip to the tourist traps in the future.  Except that won't happen.
The Beloit-Janesville lane expansion is just one lane project that will cause temporary traffic diversions, multiple temporary closures and an untold number of orange construction barrels along the Interstate—but it's a portion of heavy construction that will run right up the gut of Janesville's east side, where traffic bottlenecks under normal conditions rank among the heaviest on I-90/39's Wisconsin corridor.

The 12-mile stretch of road's two-year tear up offers one snapshot of traffic disruption linked to a project that could last at least five more years on a highway that is one of the main funnels into Wisconsin for interstate commerce and tourism traffic.

Walker said last fall that the I-90/39 expansion is one project he doesn't want to see derailed as the state works on a new budget.
It doesn't matter, after the work is done, whether there are four lanes each way through Janesville, or eight, or ten. Traffic will expand to fill the available lanes.  If that's not enough aggravation for one day, note the subtle intrusion of the sunk cost fallacy.
State Rep. Amy Loudenbeck, R-Clinton, in an interview last week said she was encouraged by the fact that projects on the I-90/39 expansion appear to be on track.

Loudenbeck is a member of the legislative Joint Finance Committee, a group that in the past has led shaping of the legislative version of the state budget, which is ultimately submitted to the governor.

That fact—and the fact the DOT already has carried out tens of millions of dollars in sideline work linked to the project, including multiple overpasses rebuilt and widened to support expanded lanes on I-90/39—have made Loudenbeck more optimistic that I-90/39 project could continue to roll out as planned.
The upgraded overpasses give the highway department the option of widening the interstates, should they choose to exercise it.  But exercising the option, and causing more traffic congestion now in the hopes of mitigating it later?  Doubtful.

UNBUNDLING CHURCH AND STATE.

In the Insta Pundit "Change" file we find "Alabama moves to separate marriage and state."

That's a topic I've been following for some time, because it lets me get away with post titles like "intercourse becomes clothed with a public interest" but behind the wisecracking, there's a Deep Policy Question.
Doesn't that imply a competence for the state in protecting the interests of children that it has not demonstrated when it comes to providing education, or school lunches, or safe neighborhoods?

Put another way, the culture is doing just fine in protecting children -- in neighborhoods where the adults act responsibly, and not so well -- in neighborhoods where the adults don't. Maybe it's time for the editors at National Review to unbundle government from culture, or Caesar from Christ?
That appears to be precisely what the Alabama bill, not yet law, envisions. "Civil or religious ceremonies would have no legal effect upon the validity of the marriage. The state would only recognize the legal contract signed by the two parties entering into the marriage."  In so doing, the bill would undo the bundling of church and state that has made so much of what ought to be a straightforward contract between consenting adults a frontline of the Culture Wars.  "But that turns the civil institution -- as opposed to the religious sacrament -- of marriage into a contractual agreement (with no-fault divorce, it's notarized dating) for the benefit of adults."

Interesting that Alabama, for so long a punchline to the Coastal Elite, is achieving precisely the kind of unbundling in which two people can register a legal marriage contract, whether the local fundamentalist church, synagogue, or mosque rejects it or the local reform congregation solemnizes it notwithstanding.  The Tenth Amendment Center's post intriguingly turns appellate judges into auxiliary bishops.
Removing state meddling in marriage would render void the edicts of federal judges that have overturned state laws defining the institution. The founding generation never envisioned unelected judges issuing ex cathedra pronouncements regarding the definition of social institutions, and the Constitution delegates the federal judiciary no authority to do so.

Constitutionally, marriage is an issue left to the state and the people.
Further, when reproduction no longer is clothed with a public interest, the unbundling of the secular contract from the sacred sacrament becomes a restoration of the status quo that even Stephanie Coontz, with a New York Times imprimatur, doesn't denounce as turning the clock back.
In the mid-20th century, governments began to get out of the business of deciding which couples were “fit” to marry. Courts invalidated laws against interracial marriage, struck down other barriers and even extended marriage rights to prisoners.

But governments began relying on marriage licenses for a new purpose: as a way of distributing resources to dependents. The Social Security Act provided survivors’ benefits with proof of marriage. Employers used marital status to determine whether they would provide health insurance or pension benefits to employees’ dependents. Courts and hospitals required a marriage license before granting couples the privilege of inheriting from each other or receiving medical information.
The Tenth Amendment Center post notes that the power to license is the power to forbid.
Put another way, under a licensing scheme, marriage is not a right, nor a religious institution, but a privilege granted by the state and limited by its requirements.

Consider this: In the same way a driver can lose their license if they break certain traffic laws, a man or woman, theoretically, could one day find their marriage license revoked for breaking certain “marriage” rules, whether it pertains to child rearing, or their religious and political convictions.
To an extent, this revocation already exists, in the form of the child protection bureaucracy putting children in protective custody, under guises pertinent to child rearing or to convictions.  That might be beyond the capability of governance to fix.  Instilling bourgeois habits in young people before they become parents might still be a good idea.  Reclaim the culture.  Stop enabling the dysfunction.

THE FORGES OF THE ARSENAL OF DEMOCRACY.

As featured in an Office of War Information short on the steel works of Youngstown, Ohio.

Post edited and updated to present the full original video, which includes vignettes of the steel men at home, their children at school, and their symphony orchestra.  The country is at war, the outcome is still in doubt, and yet the message is optimistic.

There are a number of action shots among the furnaces and mills.  We'll see an open hearth crew poking the tap hole open with a long prod.  I don't envy the front man, closest to the door.  One wrong move ...  The other ways to get the tap hole open are to use a stick of dynamite, or go underneath the furnace with an oxygen lance, both of which are risky as well.


Closing observation: "When the war is over, we're going to face problems."  Yes, and the narrator probably didn't anticipate half of it.

27.2.17

NO MAN CAN KINDLE THE EKPYROSIS.

In What Does Steve Bannon Want?, New York Times scribe Christopher Caldwell (on loan from Weekly Standard) suggests Mr Bannon still thinks he can.
There are plenty of reasons for concern about Mr. Bannon, but they have less to do with where he stands on the issues than with who he is as a person. He is a newcomer to political power and, in fact, relatively new to an interest in politics. He is willing to break with authority. While he does not embrace any of the discredited ideologies of the last century, he is attached to a theory of history’s cycles that is, to put it politely, untested. Most ominously, he is an intellectual in politics excited by grand theories — a combination that has produced unpredictable results before.

We’ll see how it works out. Barack Obama, in a similar way, used to allude to the direction and the “arc” of history. Some may find the two theories of history equally naïve and unrealistic. Others may see a mitigating element in the cyclical nature of Mr. Bannon’s view. A progressive who believes history is more or less linear is fighting for immortality when he enters the political arena. A conservative who believes history is cyclical is fighting only for a role in managing, say, the next 20 or 80 years. Then his work will be undone, as everyone’s is eventually.
And complex adaptive systems will do what they d**n well please, the Fatal Conceits of Theoreticians, whether they think they're riding the arc of history or the hamster wheel of history notwithstanding.

TEN YEARS AGO.

City University of New York's K. C. Johnson became more sympathetic to scholars of the right after the vilification he got (the link now goes to the memory hole) for investigating the trumped-up charges (oh, if we had the terms "fake news" and "alternative facts" in the vernacular back in the day) against the Duke lacrosse squad.  "Really, the absolute refusal of the Group of 88 or other players in this affair to apologize or tone down their behavior in any way, as if all of the facts are the same now as they were on March 29th, and to show no indication they've comprehended anything … it's depressing."

But the tendency of the people in power in higher education to let "the right," loosely speaking, to win the logical arguments by default has a long pedigree.  Over the weekend, I was tossing stuff and I came across a Washington Monthly 20th Anniversary issue, from October 1989 (they hadn't yet twigged to the reality of Communism crumbling, such were deadlines in those pre-internet days) with the cover featuring "Why higher education is neither."  This article came out about a year after Charlie Sykes's Prof Scam, and many of the points the authors make could have as well have been made by Mr Sykes, or any of the other Tories.  The argument they raise in response to the Canon Conflicts back in the day generalizes.
What's unfortunate is that while the conservative reformers have diagnosed the ailment correctly--curricula diluta--they've tended to offer a suspiciously narrow cure: a canon composed almost exclusively of Western, and male, influences. Liberals have responded by dismissing the idea of a core altogether--ceding leadership to the Right--rather than working to institute their own core, one that preserves greatness as the standard but doesn't stop at William Bennett's borders.
In how many other ways to the Folks In Charge of higher education continue with business as usual, and no indication that they've comprehended anything?

26.2.17

A HOLDOVER OF FAIRBANKS-MORSE INFLUENCE IN RUSSIA?

Here's a Bryansk-Built A-B-A set of the new 3TE25K2M diesel locomotives being delivered for use on the Baikal-Amur Main Line.
Designed to haul 7 100 tonne freight trains on the 2 800 km Baikal-Amur Magistral route between Taksimo, Tynda, Komsomolsk-na-Amure and Sovetskaya Gavan on the Pacific coast, the 9·3 MW locomotive has three six-axle sections with microprocessor controls and AC traction motors.

Initial testing is to be undertaken at Kurbakinskaya in Kursk oblast before the locomotive is transferred to the BAM route.
I've been led to understand that an early series of Soviet diesels borrowed the layout of the cooling system from the Erie-Built, which, in turn, borrowed it from a submarine (there being Fairbanks-Morse opposed-piston diesels in submarines, so why not?) and these new diesels have the same radiator layout.
Unattributed image retrieved from Railway Gazette.

To continue the Erie comparisons, each unit has about the same power rating as General Electric's contemporary ES44AC or ES44C4.  The Russian units (does the TE still stand for "teplo?") look prettier, but on a Powder River coal train, it's the oomph, not the aesthetics.

On the other hand, with the Erie-Builts, you had the aesthetics.  Well, the U.S. railroads had Raymond Loewy and the Soviets didn't.


Milwaukee, Wisconsin, sometime in the late 1940s.

The Milwaukee Road purchased these Erie Builts, with the special trim and lettering, to haul The Olympian Hiawatha between Chicago and Seattle, a distance of about 3500 km, without the change to electric locomotives in the Mountain West.  Elsewhere in the States, Kansas City Southern hauled long freight trains through the western Ozarks with four unit sets, rated at 6.8 MW, about what two of the current Russian units are good for.  Milwaukee's Erie-Builts didn't last long in Olympian Hiawatha service, although they stayed on corridor trains and in commuter service until the trust certificates expired.

WHEN YOU MAKE MEN WITHOUT CHESTS.

In National Review, Steven Watts contemplates redemptive masculinity, from John Kennedy in the era of men in gray flannel suits, to Donald Trump in the era of near men in red flannel pajamas.
Thus, for many in heartland America, the denigration of men and the erosion of the very notion of masculinity have become disturbing features of modern culture. The modern Democratic party, with its unwavering devotion to gender-identity politics, is seen as the vessel for this unsettling culture. Many Democrats simply insist that gender issues are no longer topics for searching debate but settled imperatives — skeptics or opponents are automatically castigated as sexist stooges of the patriarchy. The Democratic party has made itself into a display case for trophies of unfettered gender expression and declining masculinity.

In terms of personalities, President Obama has been Exhibit No. 1. Much of middle America recoiled from a man who refused to hold to his own “red line” in Syria, knuckled under to the Iranians hell-bent on developing nuclear weapons, embraced a strategy of “leading from behind,” failed to stand up to Russia and China, and refused to condemn radical Islam because of a P.C. sensitivity about offending Muslims. In a world where a host of fanatical jihadists are bent on murdering Americans, many citizens winced at what they saw as the president’s soft metrosexual image.

Hillary Clinton has been Exhibit No. 2. Famously, she condescendingly condemned her traditionalist opponents as a “basket of deplorables” who are “racist, sexist, homophobic, xenophobic, Islamaphobic — you name it.” With her notoriously philandering, predatory husband in tow, she became almost a caricature of the hectoring P.C. zealot determined to cram sensitivity down everyone’s throat.

Enter the outlandishly male Trump. No matter how crudely, he promised a remedy. His brash assertions that he would stand up to the nation’s enemies and negotiate strict new trade deals, and his Mixed Martial Arts–style slam-downs of political opponents and critics seemed to demonstrate a clear masculine toughness. Even his crude sexual rhetoric and apparent misogyny, which understandably outraged many, elicited only shoulder-shrugging unconcern in middle America, where it was seen as a by-product of his aggressive masculinity. Trump’s barrage of Twitter counterattacks against critics, a source of much consternation among the commentariat, delight his supporters for the same reason. They see the short, sharp Twitter blasts as a weapon of masculine assertion — when someone hits you, you hit back even harder — that are beyond the control of the P.C. police in the media.
And yet, punching back at the people who deconstruct normality and call it progress isn't enough.  There must be a foundation of order, or else one unraveling gives way to another.  In such an order Mr Trump would be outside the realm of the respectable.  But these days, respectable means you can't insult voters on your way to the presidency (see those deplorables) although insulting other aspirants (Little Marco, Crooked Hillary) is simply Speaking Truth to Power.)
Trumpism expresses a genuine, understandable yearning to reestablish some sense of sexual normalcy, some accepted standards in our culture so that gender identity will not be fluid to the point of utter formlessness, so that marriages and families and the basic building blocks of society may rest on a firm foundation. Trumpism reflects an instinctive Burkean belief in middle America that society is rooted in personal morality and webs of shared standards and loyalties and responsibilities, and that if we dissolve sexual norms, we might be pulling the thread that then unravels the whole. In flyover country far from leviathan cities and the insular safe spaces of the academy, the fraying of the sexual order and the anxiety over degenerating masculinity have created legitimate fears of social disintegration. Trump’s hyper-masculine image of strength and vigor soothe such anxiety.

At the same time, Trump’s masculine style has a disturbing implication. Of JFK and Trump, both strongly male presidents, the earlier candidate was cool, sophisticated, intellectual, elegant, and sexually alluring while the latter is bombastic, vulgar, uninformed, and sexually aggressive. This contrast reflects deep personality differences between two individuals, but it also says something about Americans’ growing narcissism and addiction to celebrity, entertainment, and the gospel of self-fulfillment. Kennedy advanced as an individual who had political experience and policy expertise; his celebrity provided a glamorous veneer. Trump has ascended as man in whom celebrity is nearly all, with his political principles replaced by loutish self-aggrandizement. With the elevation of the Donald, who is almost a cartoon version of JFK, to the pinnacle of national leadership, we see not only fear about the decline of the American male but also distressing evidence of the larger decline of American culture.
What was I saying about the cultural conflict that must be resolved before a new values regime emerges?

22.2.17

TEN YEARS AGO.

It's actually a throwback to sixteen years ago, with some questions that might be germane to a Fourth Turning.

February 2007 was before the housing bubble popped, and perhaps the carnage in the financial markets was the catalyst for the saecular crisis.  But the answers to the questions Fourth Turning gurus William Strauss and  Neil Howe proposed generally had answers in the negative in 2007, the answers didn't change much by 2008 or 2009, and more recent developments aren't what the prophets expected.
  • Are leaders describing the problem in larger rather than smaller terms, proposing grand solutions, and seeking to destroy (and not just contain) enemies?
Ten years ago, gridlock and limited wars were still the order of the day.  The Iraq surge might have been starting.  Mr Obama took office in 2009 with helpful majorities in the House and the Senate and plenty of discontent with the Way Things Were.  And yet the "Patient Protection and Affordable Care Act," two lies for the price of one, is unsustainable, the stimulus was a give-away to rent-seekers, and the less bellicose foreign posture did nothing to contain foreign enemies.

Today, is "Make America Great Again" a grand solution, or a grandiose slogan?  More importantly, might the destruction to come be of the major political parties, which have abandoned most pretenses of comity, let alone bipartisan consensus?
  • Is there a shift away from individualism (and civil liberties) toward community purpose (and national survival)?
Perhaps, but the values regime that will define what that purpose is is not yet taking form.  Or, there are two competing visions, one involving a community purpose of greater freedom, the other being a community purpose of coalescing identity politics interests.
  • Are the old "culture wars" arguments beginning to feel lame, ridiculous, even dangerous to national unity?
The culture wars arguments are what brought people out to vote for Mr Trump and the Republican majorities, and the culture wars arguments are motivating the resistance.  Perhaps those are the contradictions that must be settled before a new values regime implants.
  • Is the celebrity culture feeling newly irrelevant? Is youth fare becoming less gross and less violent?
Seriously?
  • Is immigration reversing? Are mobility and openness declining? Is there more nativism in our culture and less "globalism" in our commerce?
Yes, although eight years of economic stagnation will do that.  Plus finding ways to extract oil and gas locally.
  • Is there a new willingness to pay a human price to achieve a national purpose? Will we harness technology only to reduce casualties and inconvenience, or also to achieve a total and lasting victory?
Not yet.  Until there's some sort of agreement on that national purpose, it's unlikely.
  • Is each generation entering its new phase of life with a new attitude? Are aging boomers overcoming narcissism? Are Gen-Xers on the edge of midlife, circling their wagons around family? Are Millennials emerging as a special and celebrated crop of youth?
Hardly.  The Millennials are the cohort everyone older loves to hate on, and their successor cohort, at least the visible ones at the high-end colleges and in entertainment, come off as snowflakier still.  Meanwhile, the aging boomers are still taking sides, either with the jocks or with the hippies.

Might we be looking at another Civil War anomaly?  In that saeculum, the Panic of 1857 and secession came in short order, and in Fourth Turning morphology, the period of unraveling was too short.  This time around, though, the unraveling goes on and on without any emergent outline of a resolution.  Perhaps history does rhyme, but as if in the forms favored by avant-garde poets.

MAKING THE CASE FOR STEEL.

The Association for Iron and Steel Technology invited students to "produce a three-minute original video that highlights advanced technologies in steelmaking."  The submissions participated in a contest.  I don't know how much longer the contest announcement will remain a live link.

One of the entries, "Steel: An Awakening," illustrates the changing nature of the steel works.  It will put into context some of the developments highlighted in my recent review of City of Steel.


Another video from the Association, "The Art of Steelmaking," rebuts the presumption that the steel works is an "iron-spouting dinosaur."  Plenty of vintage footage before the contemporary technology rolls out.  Enjoy.


Here are some still shots of the iron-spouting dinosaurs that didn't make it past the 1980s.

21.2.17

AUGMENTING THE POWER OF MEN.

Once upon a time, steel was a metal hard-won, from iron that itself might be coaxed a few drops at a time from a simple blast furnace, or extracted at great hazard through the muscle power of iron puddlers, then to be converted into small bunches of steel in crucibles that took a lot of hand labor in hot conditions to handle properly.

Then came the Bessemer converter to remove some carbon from the iron, perhaps with a proper heat of steel as the end product, the open-hearth reverberatory furnace, a scaling-up of the puddler's furnace, to obtain a more precise steeling of the iron.  To make that steel on a larger scale required greater inputs of iron, and to reduce ores in the quantities envisioned meant improvements in logistics and in blast furnace practice.

Put all these things together and you have Kenneth J. Kobus's City of Steel: How Pittsburgh Became the World's Steelmaking Capital During the Carnegie Era, our Book Review No. 4.  Mr Kobus worked in the steel mills of Pittsburgh, and was intrigued enough by what he saw to dig into archives and corporate records and put together a story of the accumulation of small advantages accompanied by occasional Aha! moments that converted steelmaking from a hot, dangerous, artisanal business to a hot, less dangerous, industrial activity.

And for all the Popular Perspective of the Gilded Age steel works being a dark, satanic place, the reality of technical change is one of providing safer working conditions in which fewer men can produce tonnages the old-time puddlers and crucible handlers would find inconceivable.  And the safer working conditions turned out to be more productive working conditions as well.  For instance, in the early Bessemer and open hearth plants, furnace tapping and ingot teeming took place in the same pit.  Rearrange the plant and put in travelling cranes to move the larger ladles, now the teeming doesn't have to stop each time a furnace is tapped.  Likewise, the early iron furnaces had to be charged by hand, one wheelbarrow at a time, through an open top.  And yes, all sorts of toxic gases came out of that open top.  Work out a skip hoist and an air lock that can handle the weight of the charge, and one hazard to the furnaceman's health is mitigated.  Then figure out how to transport molten iron from blast furnace to open hearth, rather than casting pigs to reheat in a cupola furnace before charging that iron into the converter.  Also, improve the rolling machinery, in order that achieving the final shape of the steel doesn't require strong men working in close proximity to hot steel to muscle it into shape.  One steelworker characterized the conditions as "working aside of hell ahead of time," whether with the cupolas, in the tapping and teeming pit, or alongside the rolling mills.

Thus, yes, Andrew Carnegie and his financiers made a lot of money.  But their gains coexisted with improvements in working conditions and compensation in the mills, in the quality and quantity of steel available for final consumption, and in the energy intensity of the business.  (And the improvements go on.)

In part, Pittsburgh (and the western slope of the Alleghenies generally) emerged as the center of the steel trade because of existing ironmaking technologies and nearby coal deposits, although ultimately the competitive advantage would go to a plant with a deep water port, such as near Chicago or Cleveland.  But that's a story for a different line of research.

(Cross-posted to 50 Book Challenge.)

IN PLACE OF FIRELESS COOKERS.

The plant switcher is an interesting, sometimes obscure part of railroading.  The fireless cooker looks like a steam locomotive, but it's a thermos bottle on rails that creates superheated steam from water by using up a charge of high-pressure steam in order to move cars around.  They're useful in places like powder mills, ammunition depots, and chemical plants where a stray spark might not be welcome.

In Germany, Wartsteiner have purchased a battery-powered critter for shunting inbound and outbound cargo at the brewery.
The 34 tonne vehicle has the capability of hauling up to 12 wagons at the brewery’s container terminal. As well as lowering noise and emissions, the use of the battery- powered vehicle instead of the previous diesel shunting locomotive will eliminate the need to have a refuelling point with its associated environmental requirements.

The 2·5 tonne battery is able to provide power for several days of operation on a three-shift basis before needing to be recharged via a cable to a 400 V mains outlet.
That's more endurance than the fireless cooker exhibited, those might be capable of going eight hours before having to take on a new charge of steam.  I like the way batteries are becoming more durable and more powerful.  It's likely that many of my model locomotives will have battery power and wireless control.

Breweries using electric locomotives for plant switching, though?  They used to be bigger in Texas.


Pearl Brewery saw fit to preserve Motor No. 2 of its Texas Transportation Company in San Antonio, after they modernized the factory and turned much of the complex into an upscale shopping area along the northern extension of the river walk.

Wartsteiner's critter is a more compact unit, but perhaps not as charming as Pearl's motor.  Long may it shift cars.


Unattributed image retrieved from Railway Gazette.

AS THE SAECULUM TURNS?

In The American Conservative, Robert W. Merry credits Donald Trump with perceiving a crisis of the status quo.
The campaign year of 2016 turned out to be a year of crisis politics writ large, manifest not just in Trump’s rise but also in the remarkable run, in the Democratic primaries, of democratic-socialist Bernie Sanders, the Vermont senator.

As the surprise-laden year unfolded, more and more analysts cast their thinking toward the angers and frustrations within the electorate that were driving the country in entirely unanticipated directions. Elements of the crisis now were seen and probed. But few captured its full magnitude.

It was nothing less than a crisis of the old order, a crisis of the crumbling status quo. Its most significant manifestation was the political deadlock that gripped official Washington and rendered it incapable of political action. Many saw this as a problem in itself, but in reality it was merely a stark manifestation of the status quo crisis. As the old order of American politics began to disintegrate, the two parties clung ever more tenaciously to their familiar and time-tested positions, defaulting to an increasingly rigid groupthink stubbornness and shunning any thought of political compromise. Far from grappling with the crisis of the old order that had descended upon America and the world, the party elites couldn’t even acknowledge its existence.

But the country was at an inflection point. It desperately needed a new brand of politics that could break the deadlock and set it upon a new course toward its future and destiny. In such times, a gap inevitably emerges between the political establishment, guided by the lessons of the past (increasingly irrelevant lessons, as it happens), and the electorate, always ahead of the establishment in seeing the need for new political paradigms, new dialectical thinking, and new coalitions designed to bust up political logjams and set the country upon a new course.
Put another way, a Fourth Turning is an emergent phenomenon.  And it's precisely the old saecular order, the one of Franklin Roosevelt and Happy Days are Here Again, that is now untenable.
FDR’s power consolidation has created over time a collection of elites that has restrained the body politic in tethers of favoritism and self-serving maneuver. Wall Street dominates the government’s levers of financial decision-making. Public-employee unions utilize their power (they can fire their bosses) to capture greater and greater shares of the public fisc. Corporations foster tax-code provisions that allow them to game the system. “Crony capitalism’’ runs rampant. Members of Congress tilt the political system to favor incumbency. A national-debt burden threatens the country’s financial health. Uncontrolled immigration threatens the country’s sense of security and, for many, its sense of nationhood. The nation’s industrial base has been hollowed out, and the vast American working class—the bedrock of the FDR coalition—is squeezed to the point of desperation.
Not to mention being squeezed into a basket of deplorables, but I digress.

More to the point, Mr Merry might be too wedded to the status quo to fully grasp what upending the saecular order involves.
He might succeed. He might fail. Either way, the American people, in their collective judgment, will maintain an unsentimental view of it all. If he succeeds, they will reward him with their votes, and a new coalition might emerge. If he fails, they will fire him. And then the crisis of the old order will continue and deepen until, somehow, at some point, the voters manage to select a president who can get the job done.
Emergence is beyond the power of a president to manage. Perhaps Mr Trump will cobble together enough of a coalition to get the current job done, and perhaps that coalition will set the values regime for the next eighty years. Or perhaps the new values regime will emerge despite what goes on in Washington.  That's something a brief American Interest commentary hints at, without looking more closely into the abyss.
The Trump voters were right that the nation needs change and that the “best and the brightest” are failing the nation the way they did during the Vietnam War; the Clinton voters were right that on the whole the Trump team lacks the skills and the temperament to run the country. Glenn Reynolds is right that this isn’t just another example of partisan gridlock. It is a danger to the stability of the United States political system.
Let's not forget that "best and brightest" is a dig at the Wise Experts of the early 1960s who promised Guns and Butter, Victory in Vietnam, Victory over Poverty, and Water from the Moon.  OK, I'm exaggerating on that last one.

And I'm not sure what to make of Doug Schoen's lament for Scoop Jackson's Democrat Party.
While the Democratic Party is driven left by anti-Trump activists, protestors, and Senators such as Bernie Sanders and Elizabeth Warren, America itself remains a fundamentally center-right nation.

A fundamental belief in national sovereignty and individual responsibility, married to cautious skepticism of government and deeply held moral convictions, continues to govern how most Americans think about politics.
That's an opportunity for libertarian-minded political operatives, if they'd but seize it.  For Mr Schoen, it's all about the bipartisanship.
Despite what the Democratic base wants, if these Trump-state Democrats fail to find opportunities to cooperate with Trump, or at least position themselves as centrists congruent with their constituents’ beliefs, they will lose to a more canny Republican candidate in the general election and increase the likelihood that Trump gains a filibuster-proof Senate.

While the Democratic Party's progressive and moderate wings clash with one another over their party’s future, Republicans are dismantling the blue wall and solidifying America’s status as a center-right nation.
Perhaps, although if there's scant evidence of a regeneracy, it's the Republicans who might find themselves turfed out.  If it's the Democrats doing the turfing-out, the tussle over the shape of the new saecular order is likely to be further prolonged.

We'll know that something new is taking shape if we see people rediscovering the merits of the Tenth Amendment, rather than defaulting every difficulty to Management by Wise Experts in Washington.  The Best and the Brightest have sat there long enough.  Go!

THIS IS WHAT SEPARATION OF POWERS LOOKS LIKE.

Rebecca Berg of Real Clear Politics observes the lion lying down with the lamb.  Red-State Dems Thread the Needle in Working With Trump.
Ten Democratic senators will face re-election fights next year in states where Trump won; of those, five hail from states where he won by double digits. But with their party base screaming for blood, those incumbents could find themselves swimming against the partisan tide in both directions, torn between working with Trump or denouncing him.

In a meeting at the White House earlier this month, one of those vulnerable Democrats, Sen. Jon Tester of Montana, explained his compromise approach to the president. “I will work with you when I can,” Tester said, according to a Montana NBC affiliate, “and I will hold you accountable when I must.”
That's not a bad stance for any Member of Congress to take, whether in the majority party or the president's party.  Might be particularly useful for Democrats, working with normals in Real America, if they have any hope of escaping their marginalization to the coasts.  But doing the right thing isn't what Democrats do, not these days.
Democrats have firmly rejected Trump from the outset — with protests and angry constituents at town-hall meetings harkening back to the Tea Party movement in 2009 and 2010, which propelled Republicans to historic gains in Congress.

For red-state Democrats like [West Virginia senator Joe] Manchin, the challenge will be to find the “common denominator between the agenda of the grassroots organizations and all the voters in the state, including the Trump voters,” said Sen. Chris Van Hollen, the chairman of the Democratic Senatorial Campaign Committee this election cycle.

“My view is that these senators are going to be reaching out to all the people in their state, progressives and others, and making the best decision,” Van Hollen added.
In Illinois, Senator Durbin recognizes that his, too, is a rump coastal party, in his case that uneasy coalition of privilege and the third world we know as Chicago.
“I live in a blue island in a big red sea,” said Sen. Dick Durbin, who hails from Illinois, “and a lot of these folks are not that lucky politically.”

Even then, Durbin faces acute pressure from his party’s base that he cannot always satisfy. “There are people in my state that want me to vote ‘no’ on everything,” the Democratic whip said. “They’re mad at me because I voted for some of Trump’s nominees.”
But the Leading Lights among the Democrats have gone from Bipartisan Consensus to Beyond Principled Opposition in ein Augenblick.
The art of politics is often a delicate balance between stoking partisan fire and then containing it. But recent political trends have seemed to incentivize burning everything down. Sen. Elizabeth Warren, a leading face of the Democratic opposition to Trump, has promoted such an unyielding approach.

“It's not an either-or choice, and Democrats who are making it out to be aren't doing their colleagues in tough races any favors,” said one Democratic strategist who works on Senate campaigns.
That might be why Senator McConnell went to the trouble of making Fauxahontas a Martyr to the Cause.  Another preachy, sanctimonious scold in a pantsuit?  Bring it, he might be suggesting.

20.2.17

WHEN ELITE CONSENSUS FAILS.

If, emulating Hayek, we contemplate a Fatal Conceit, then there must be a time for morbidity and mortality to render futile what the Wise Experts aspire to do.  And when the signs of decline set in, suggests John Judis, they might manifest themselves among the people as a populist insurgency.  Thus comes his The Populist Explosion: How the Great Recession Transformed American and European Politics.  It's a Columbia Global Report, and yet a readable, tightly argued product for Book Review No. 3.

There are many manifestations of populism, some from the left, and some from the right, but when the Political Consensus breaks down, and the usual medicine of a Realignment Election doesn't keep enough of the Consensus in place, then comes an insurgency.  But the term "populism" misleads, in that often there is a vanguard, or perhaps a Pied Piper, and in the United States, the last two Pied Pipers were named Sanders and Trump.  And Mr Judis submitted his book for publication after one Hillary Clinton had won the Democrat nomination and she looked to be a lock for the presidency.

Thus, perhaps, the current Elite Consensus is in worse shape than he would have his readers believe.  That noted, there is much in the book to reward careful study, including the observation that, no matter how outrageous some elements of populism, left or right, appear to be, those elements emerge in response to real pain inflicted on real people by the prevailing consensus: banks bailed out, but not householders or pensioners; diversity celebrated in principle but in practice an ethnic dependent class appears; imports mean overseas cash to finance public spending.  Then comes the harder task of ameliorating the pain and replacing the failed institutions.  That's a task for another book.

Mr Judis suggests that the right populist movements are ascendant in part because leaders of those movements are more effectively pointing out the shortcomings of Political Consensus.  That's likely true.  But some upwellings from advocates of a left populism suggest that there are limits to vanguardism from the left.  Consider this assertion by philosopher Nancy Fraser, in Dissent.
Trump’s victory is not solely a revolt against global finance. What his voters rejected was not neoliberalism tout court, but progressive neoliberalism. This may sound to some like an oxymoron, but it is a real, if perverse, political alignment that holds the key to understanding the U.S. election results and perhaps some developments elsewhere too. In its U.S. form, progressive neoliberalism is an alliance of mainstream currents of new social movements (feminism, anti-racism, multiculturalism, and LGBTQ rights), on the one side, and high-end “symbolic” and service-based business sectors (Wall Street, Silicon Valley, and Hollywood), on the other. In this alliance, progressive forces are effectively joined with the forces of cognitive capitalism, especially financialization. However unwittingly, the former lend their charisma to the latter. Ideals like diversity and empowerment, which could in principle serve different ends, now gloss policies that have devastated manufacturing and what were once middle-class lives.

Progressive neoliberalism developed in the United States over the last three decades and was ratified with Bill Clinton’s election in 1992. Clinton was the principal engineer and standard-bearer of the “New Democrats,” the U.S. equivalent of Tony Blair’s “New Labor.” In place of the New Deal coalition of unionized manufacturing workers, African Americans, and the urban middle classes, he forged a new alliance of entrepreneurs, suburbanites, new social movements, and youth, all proclaiming their modern, progressive bona fides by embracing diversity, multiculturalism, and women’s rights. Even as it endorsed such progressive notions, the Clinton administration courted Wall Street. Turning the economy over to Goldman Sachs, it deregulated the banking system and negotiated the free-trade agreements that accelerated deindustrialization. What fell by the wayside was the Rust Belt—once the stronghold of New Deal social democracy, and now the region that delivered the electoral college to Donald Trump. That region, along with newer industrial centers in the South, took a major hit as runaway financialization unfolded over the course of the last two decades. Continued by his successors, including Barack Obama, Clinton’s policies degraded the living conditions of all working people, but especially those employed in industrial production. In short, Clintonism bears a heavy share of responsibility for the weakening of unions, the decline of real wages, the increasing precarity of work, and the rise of the two–earner family in place of the defunct family wage.
That's what unstable governing coalitions look like.  But in a USA Today column, Glenn "Insta Pundit" Reynolds quotes Richard "Belmont Club" Fernandez, on precisely how that governing coalition revealed itself as anything but populist.  "The elites lost their mojo by becoming absurd. It happened on the road between cultural appropriation and transgender bathrooms."

I'll have to keep reminding people that you can have a family wage, or you can have female labor force participation, but you can't have both.

To Professor Fraser, however, it's not about populism at all, it's about getting the theoretics right.
Neoliberals gained power by draping their project in a new cosmopolitan ethos, centered on diversity, women’s empowerment, and LGBTQ rights. Drawing in supporters of such ideals, they forged a new hegemonic bloc, which I called progressive neoliberalism. In identifying and analyzing this bloc, I never lost sight of the power of finance capital, as Brenner claims, but offered an explanation for its political ascendance.

The lens of hegemony also sheds light on the position of social movements vis-à-vis neoliberalism. Instead of parsing out who colluded and who was coopted, I focused on the widespread shift in progressive thinking from equality to meritocracy. Saturating the airwaves in recent decades, that thinking influenced not only liberal feminists and diversity advocates who knowingly embraced its individualist ethos, but also many within social movements. Even those whom Brenner calls social-welfare feminists found something to identify with in progressive neoliberalism, and in doing so, turned a blind eye to its contradictions.
Meanwhile, Mr Trump is doubling down on the country being governed by stupid people, and the legacy press carrying water for the hegemons.  But he's saying "lying press."  That's more likely to be the "political earthquake [to overturn] neoliberalism and realign the parties" Mr Judis contemplates.

(Cross-posted to 50 Book Challenge.)

THE CASE FOR MARKET TESTS.

The business honor society Beta Gamma Sigma recognized Northern Illinois University graduate Jeffrey Aronin with a Medallion for Entrepreneurship.

Mr Aronin's entrepreneurship included the marketing of an artificial steroid, something that Margaret "University Diaries" Soltan laid off on his business school days as learning "how to jack up the price."

The problem, dear reader, is that thanks to all the third parties involved in the researching, testing, and prescribing of medications, there is no price discovery.
Those who need costly medications can face thousands of dollars in deductible and co-insurance payments, depending on how their insurance plans cover drugs and whether they get help from patient assistance programs. Even with insurers covering most of the expenses, that coverage can come at a cost to all consumers in the form of higher premiums.

"This idea that the vast majority of people out there are just paying flat $20 copays, it's based on an old understanding of what insurance (does)," said Rena Conti, a University of Chicago associate professor of health policy who studies drug prices.
Note carefully: covering most of the expenses.  Manufacturer puts a number on an invoice, but nowhere in the writing down of that number are there any market tests by which that number bears any resemblance to the marginal cost, nor can it, as the biochemists working whether on grants, consulting contracts, or salaries, have few opportunities to shop their skills on an open market.
Aronin said the company set the list price of deflazacort, which will be sold under the brand name Emflaza, at $89,000 based on resources it invested to bring the drug to market and complete clinical studies, as well as to fund future research and ensure broad patient access through insurer reimbursement and its own assistance programs.
"Based on resources" is corporate-speak for "wild-ass guess."  "Ensure broad patient access through insurer reimbursement" is corporate-speak for "They make wild-ass guesses too."

In the absence of market-tested betterments, you get wild-ass guesses.  Maybe the cross-subsidies work out well for people of modest means.  On the other hand, in the presence of market-tested betterments, you get continuous improvement and cheaper stuff.

THE DEFLATING SPORTS BUBBLE.

The city of Chicago, having received the fewest votes, did not host the 2016 Summer Olympics.  Rio de Janeiro got the honor, and the World Cup, and the financial hangover.
Around two years ago, the state government started delaying civil servants’ salaries and pension checks. Right now public employees, such as professors from the State University of Rio de Janeiro, are still receiving part of their wages for December, with no expectations for a year-end bonus. There are many reports of state employees who don’t have enough money to pay rent or buy food. For a while now, state hospitals have been unable to afford equipment, supplies and salaries. The education budget has also been slashed. Even police officers and firefighters have threatened to strike over late paychecks.
The State of Illinois has been stiffing vendors for years, but so far the first responders are getting paid. And that's without the extra burdens of building Olympic facilities for short-term use.
The budget disaster in Rio could be attributed to many factors, such as the fall in the oil prices, the expansion of the government payroll and the general recession. But there’s no doubt that reckless spending on the World Cup and the Olympics played a role. The city of Rio will be paying off the debts it amassed for years, while it also now has to maintain the arenas it built.
For all of Chicago's troubles, at least the three Stanley Cup celebrations and one World Series celebration since 2009 have made use of existing infrastructure, although the rent-seeking in Wrigleyville is getting out of hand.  Plus an America's Cup qualifying race on better water.  But perhaps, Clout City and the Combine notwithstanding, Brazilians still do corruption better.
As a result of all this, Rio’s governor is trying to pass more than 20 austerity measures. He seems to have decided that the population had effectively joined the party and now wants to split the cost of the beer. The measures include salary reductions and higher social security payments for civil servants, tax hikes, an increase in public transportation fees and the end of many social programs such as rental subsidies for the homeless. The state has also signaled it will sell off the public water supply and sanitation department to private investors.

Meanwhile, it keeps granting significant tax exemptions to telephone companies and other businesses. According to a report from the Agência Pública, a Brazilian investigative journalism agency, just 50 companies received $8 billion of tax exemptions between 2007 and 2010. They include luxury jewelry brands, beauty salons and massage parlors. Others are online retailers that barely generate jobs. The suspicion is that these companies have given big donations to political campaigns.
The New York Times assures us that Carnival will go on as scheduled, anyway.

ROLL BACK THE IMPERIAL CULT.

National Review's Kevin Williamson wants to abolish Presidents Day.  Worst.  Holiday.  Ever.

I suspect he'd be in an even less cheerful mood if he is, as I currently am, listening to Hardball with Tingles and the usual crop of Smug Establishmentarians giving the usual suspects a tongue bath.  (Although Tingles expresses some surprise that Dwight Eisenhower becomes No. 5 in the latest poll of historians, behind Lincoln, Washington, and the Roosevelts, Franklin first.  Perhaps historians are finally figuring out that it was during the Eisenhower era that America was Great?  John Kennedy is still ahead of Reagan and Lyndon Johnson, but there used to be sentiment that Lyndon Johnson belonged in the top five ...)

Mr Williamson is not so impressed.
The presidency today is a grotesquerie. It is a temporary kingship without the benefit of blood or honor or antiquity, which is to say a combination of the worst aspects of monarchy with the worst aspects of democracy, a kind of inverted Norway. (King Olav V, the “folkekonge,” was famous for using public transit.) It is steeped in imperial ceremony, from the risible and unworthy monkey show that is the State of the Union address to the motorcades and Air Force One to the elevation of the first lady (or, increasingly, “First Lady”) to the position of royal consort; our chief magistracy gives the impression of being about five minutes away from purple robes, if not togas. (There is in Philadelphia a wonderful statue of Ben Franklin in a toga, which one can sort of imagine so long as one also imagines him chugging beer with the wild boys in Tau Delta Chi.) And what kind of god-emperor does not have a national day set aside for worshiping him and his kind?

This is nuts.
If the Trump presidency is the vehicle by which people question the Cult of the Presidency and the expectation of Bright Shiny Things, bring it!

While we're at it, perhaps we can be more precise about the roles of the president.  Head of State for ceremonial occasions, sure.  But head of government?  Not really.  The distinction works better for parliamentary monarchies, for instance Queen Elizabeth is Head of State for the United Kingdom, and the Prime Minister is Head of Government, by virtue of being Majority Leader.  That's not how the Federal Constitution works.
The president of the United States is the chief officer of the federal bureaucracy, the head of one branch of a government that has three co-equal branches. Strictly speaking, it is not given to him even to make law, but only to see to the enforcement of the laws passed by Congress (and maybe to veto one here and there) and to appoint appropriate people, like the former CEO of Carl’s Jr., to high federal offices. In the legislative branch, the House of Representatives is the accelerator and the Senate is the brake; the Supreme Court, the Constitution, and the Bill of Rights are pretty much all brake; the presidency is a kind of hybrid, sometimes pressing for needful reform and action, sometimes standing in Congress’s way when it is rash or overly ambitious. The architecture of our constitutional order is a complicated and delicate balance.
Now is the time for the fanatical Turf Trump Out types to figure this out. The irony ... calling for authoritarian methods to head off what those types see as an authoritarian presidency??  A military coup?  Seriously?  Some kind of procedural action by the Washington bureaucracy (the permanent government or the deep state if you will)?  Once you embark on that course ...

That's what gridlock is for.  Embrace it.
But the president is not the tribune of the plebs. He is not a sacred person or the holder of a sacred office. He is neither pontifex nor imperator. He is not the spiritual distillation of the republic or the personification of our national ideals and values. (Thank God Almighty.) He is not even primus inter pares like the chief justice of the Supreme Court [c.q.] or the Patriarch of Constantinople. He is the commander in chief in time of war (which, since we have abandoned the advice of Washington and Eisenhower, is all of the time, now) and the chief administrator of the federal bureaucracy. That is it.

But men demand to be ruled, and they will find themselves a king even when there is none. (Consider all of the hilarious and self-abasing celebration of Donald Trump as an “alpha male” among his admirers, an exercise in chimpanzee sociology if ever there were one.) But they must convince themselves that they are being ruled by a special sort of man; in ancient times, that was the function of the hereditary character of monarchies. In our times, it is reinforced through civic religion, including the dopey annual exercise that is Presidents’ Day.

Abolish it. Mondays are for working.
A number of local schools take Presidents Day off, rather than Lincoln's Birthday, which used to be a secular holy day here in the Land of Lincoln, but at Northern Illinois University, it has always been a busier working day, with high schoolers coming in to check out the place.

THE CASE FOR MAINTENANCE.

The Oroville Dam, where construction crews are toiling to prevent a failure of Johnstown proportions, is a visible symptom of a greater rot.  "The points of failure in Oroville's infrastructure were identified many years ago, and the cost of making the needed repairs was quite small -- around $6 million. But for short-sighted reasons, the repairs were not funded; and now the bill to fix the resultant damage will likely be on the order of magnitude of over $200 million."  That's assuming the current patching succeeds and no further evacuations, particularly in extremis, occur.  And Oroville is one of the better dam sites??  "Oroville is one of the best-managed and maintained dams in the country. If it still suffered from too much deferred maintenance, imagine how vulnerable the country's thousands and thousands of smaller dams are. Trillions of dollars are needed to bring our national dams up to satisfactory status. How much else is needed for the country's roads, rail systems, waterworks, power grids, etc?"

Meanwhile, it's still a closely-run thing at Oroville, according to dam contractor Scott Cahill.  "Well, when they allowed just a bit of water to run over the emergency spillway they soon found with the velocities of only a portion of the water that could be moving over that emergency spillway. They had such severe scour that they anticipated a failure of the structural elements within 45 minutes."

Nobody is saying Johnstown, but should the spillway scour back to the dam, that sounds like a failure of Johnstown proportions.  Plus a lesson, if people will mind it.  "The question being, can we trust our government to disseminate information to us in our best interest?"

WINTER IS MODEL RAILROAD SEASON.

We've been enjoying weather conditions more like early April in the State Line, but the various model railroads in the area are having their operating sessions, filling the gap between the end of football and the beginning of March Madness.

With the State of Maine Northern still under construction (although an open day will be coming in March) some of its power is helping out on The Milwaukee Road.


The Weaver USRA Light Pacific isn't as fast as a Hiawatha steamer, and here she's pulling the Savanna to La Crescent plug that connects with the westbound Sioux at Marquette.  The mail car might be handed off to an overnight mail train at La Crescent.


The Weaver diecast 2-8-0 is returning empty meat reefers to the packing houses of western Iowa and southern Minnesota.  Once the home railroad is finished, its job will be to pick up coal from Salem Wharf destined for Boston and Maine coal docks and factories along the old Boston and Lowell and Boston Concord and Montreal lines.


I built this tank car a quarter century ago.  Start with a basket case Lionel tank casting, some Plastruct shapes, and wood for the underframe, and put the whole thing together.  There used to be some carping against the oil business, expressing the hope that Exxon could be made Humble again.  Thus the lettering on the car.  Look closely at the tracks.  In railroad yards, some of the consignments get shaken out, here limestone and iron ore.


This tank car has been visiting on the Fox Valley club for nearly twenty years.  It's a cast metal Walthers car from the bronze age of O Scale, it weighs a lot, and I bought it in rough shape at a swap meet.  Pegasus and Mobil were trademarks of the Socony Vacuum Oil Company.

The tank cars will likely be repatriated, as much of the home heating in New England is by oil, and the tank cars will be switched at dockside.

15.2.17

A FLOCK OF BLACK SWANS.

That's the story line of George Packer's The Unwinding: An Inner History of the New America, our Book Review No 2.  The thesis of the book advances the logic of saecular decline and fall, although that idea does not explicitly appear anywhere in its pages.
If you were born around 1960 or afterward, you have spent your adult life in the vertigo of that unwinding.  You watched structures that had been in place before your birth collapse like pillars of salt across the vast visible landscape -- the farms of the Carolina Piedmont, the factories of the Mahoning Valley, Florida subdivisions, California schools.  And other things, harder to see but no less vital in supporting the order of everyday life, changed beyond recognition -- ways and means in Washington caucus rooms, taboos on New York trading desks, manners and morals everywhere.  When the norms that made the old institutions normal began to unwind, and the leaders abandoned their posts, the Roosevelt Republic that had reigned for almost half a century came undone.  The void was filled by the default force in American life, organized money.
Unwinding follows a number of people from 1978 through to about 2012.  Some of these people are famous, some of them obscure, a number of them actually living in the Carolina Piedmont or trying to hold body and soul together in the Mahoning Valley or going from rich on paper to underwater on their mortgages in Florida, while in Silicon Valley, the new technology masters of the universe, not exactly organized money, prosper alongside expanding pockets of poverty just the other side of the expressway.  And in Washington, the expanded opportunities for women to participate in the labor force enhance the opportunities for family rent-seeking, with one half of the power couple in government service and the other half lobbying or working for the press corps or in a university.

Perhaps the strength of the work is that it simply relates the stories, and leaves the policy implications, the quest for stylized facts, the formulation of testable hypotheses to others.  Likewise, the deconstruction of The America That Worked(TM) is simply the background against which these people, for better or for worse -- and for many, it is unrelentingly worse -- make do.  The identification of causes and the identification of consequences are also left to others.

(Cross-posted to 50 Book Challenge.)

A NEW BIG BLOW FOR WESTERN SIBERIA.

The Russian Railways are testing a new, liquefied natural gas fueled, gas turbine electric locomotive.


Sinara Group photograph retrieved from European Railway Review.

The turbine locomotive is Russia's latest attempt to move American style freight trains across greater than American style distances, starting with the Egorshino–Alapayevsk–Serov-Sortirovochny line. I doubt that there are any roads like the old Lincoln Highway across Nebraska for pacing the trains. "The locomotive has been designed to drive trains with increased weight and length. In May 2016, during a test run, the GTh1-002 drove a train weighing 9,000 tons on the 700km Surgut–Voinovka route without the need to refuel en route."

That's the same rationale that drove the Soviet railroad system to contemplate the 4-14-4, and Union Pacific to roll out a fleet of gas turbines.

But Union Pacific never put a control cab on the tender of its 8500 horsepower (later upgraded to 10,000 horsepower) turbine sets.


The turbine set, and the Centennial series diesels that replaced them, are in preservation at the Illinois Railway Museum.  These days, if you want the oomph to move a Powder River coal train, a pair of 4400 hp diesels with alternating current drive can get the job done.  They might be too big and too heavy to fit Ivan's rails.

Union Pacific did operate one double-ended turbine locomotive of 4500 hp, at the time that was the same power as a three unit set of Electro-Motive or Alco freight diesels.


The problem with any turbine locomotive is that the power plant is only efficient at full power and cruising speed.  Trains cannot be brought to cruising speed as rapidly as jet aircraft are.  We'll see how well this Russian experiment, cleaner-burning fuel or not, works out.

FINDING THOSE MISSING MARKETS.

Now that Republicans have working majorities in the House and Senate and a president who ran on the Republican ticket, they can no longer pass symbolic repeals of the two lies for the price of one Patient Protection and Affordable Care act without having something substantive to take its place.  Here, from W. R. Mead, is the challenge.
The core problem with American health care is that our delivery system is antiquated, horribly regulated, and overpopulated by vested interests who have built sweetheart deals for themselves into the structure of the system. As a result, we pay much more for health care than we should or can. The result is a system that has all kinds of urgent, fix-me-now problems: access for the poor, affordability for the middle class, quality of care, and so on. But these cannot be fixed in the short term. The party that owns the status quo owns a wretched mess that it cannot actually fix no matter what it does.

What we need is the presence of mind to prioritize the long term, unglamorous work of installing incentives and reforms that reduce costs even as we take short term palliative methods to relieve distress. Obamacare was by and large though not totally a failure in this respect; we will see if the Republicans can do better.
For "incentives and reforms that reduce costs," think market-tested betterments.

Here's one approach, from the Independent Institute.  Getting from bureaucratic muddle to market tests is not going to be easy. "[T]he market in many states is dysfunctional — in part because we have so completely suppressed and distorted normal economic incentives. That means competitive outcomes in many states can’t serve as a reliable guide to public policy decisions."  Ultimately, breaking the bundle of job and insurance coverage facilitates market-tested betterments in labor markets and insurance markets alike.  "That would leave us with a system in which employers would have complete freedom of choice between the individual and group markets and complete freedom of choice of how their employees will receive tax relief."

John "Grumpy Economist" Cochrane also has thoughts.
It’s wiser to start with a vision of the destination. In an ideal America, health insurance is individual, portable, and guaranteed renewable — it includes the right to continue coverage, with no increase in cost. It even includes the right to transfer to a comparable plan at any other insurer. Insurance companies pay each other for these transfers, and then compete for sick as well as healthy patients. The right to continue coverage is separate from the coverage itself. You can get the right to buy gold coverage with a silver plan.

Most Americans sign up as they graduate from high school, get a drivers’ license, register to vote, or start a first job. Young healthy people might choose bare-bones catastrophic coverage, but the right to step up to a more generous plan later. Nobody’s premiums subsidize others, so such insurance is cheap.


People keep their individual plans as they go to school, get and change jobs or move around.  Employers may contribute to these individual plans. If employers offer group coverage, people keep the right to individual plans later.

Health insurance then follows people from job to job, state to state, in and out of marriage, just like car, home and life insurance, and 401(k) savings.

But health insurance is not a payment plan for small expenses, as home insurance does not “pay for” lightbulbs. Insurance protects your wallet against large, unexpected expenses. People pay for most regular care the same way they pay for cars, homes, and TVs — though likewise helped to do so with health savings and health credit accounts to smooth large expenses over time. Doctors don’t spend half their time filling out forms, and there are no longer two and a half claims processors for every doctor.
That is, insurance looks more like catastrophic coverage, which is what people carry on their houses and motor vehicles.  Market-tested betterments might be the way to go.
Big cost control comes from the only reliable source — rigorous supply competition. The minute someone tries to charge too much, new doctors, clinics, hospitals, and models of care spring up competing for the customer’s dollar. “Access” to health care comes like anything else, from your checkbook and intensely competitive businesses jockeying for it.

What about those who can’t afford even this much? Nobody dies in the street. There is also a robust system of government and charity care for the poor, indigent, those who have fallen between the cracks, and victims of rare expensive diseases. For most, this simply means a voucher or tax credit to buy private insurance.

But — a central principle — the government no longer massively screws up the health insurance and health care arrangements of the majority of Americans, who can afford houses, cars, and smartphones, and therefore health care, in order to help the unfortunate. We help people forthrightly, with taxes and on-budget spending.

Why do we not have this world? Because it was regulated out of existence, and now is simply illegal. 
The original sin of American health insurance is the tax deduction for employer-provided group plans — but not, to this day, for employer contributions to portable individual insurance. “Insurance” then became a payment plan, to maximize the tax deduction, and then horrendously inefficient as people were no longer spending their own money.
The best thing for the government to do might be to go away, or, as the Independent Institute post suggests, back away slowly.
Worse, nobody who hopes to get a job with benefits then buys long-term individual insurance. This provision alone pretty much created the preexisting conditions problem.

Patch, patch. To address preexisting conditions, the government mandated that insurers must sell insurance to everyone at the same price. Insurance companies will then try to avoid sick people, so coverage must be highly regulated. Healthy people won’t buy it, so it must be nearly impossible for people to just pay out of pocket. Obamacare added the individual mandate.

Cross-subsidies are a second original sin. Our government doesn’t like taxing and spending on budget where we can see it. So it forces others to pay: It forces employers to provide health insurance. It forces hospitals to provide free care. It low-balls Medicare and Medicaid reimbursement.

The big problem: These patches and cross-subsidies cannot stand competition. Yet without supply competition, costs increase, the number of people needing subsidized care rises, and around we go.

The Republican plans now circulating make progress. Rep. Tom Price’s plan ties protection from preexisting conditions to continuous coverage. His and Speaker Paul Ryan’s “Better Way” plan move toward premium support for private insurance, and greater portability.

So far, though, the announced plans do not really overturn the original sins. But those plans were crafted in a different political landscape. We can now go big, and really fix the government-induced health care mess in a durable way.
We'll also know when the insurance markets are working. When we stop seeing statements from the insurer that read like a cargo manifest, and when invented discounts from invented prices go away.
I visited my dermatologist last month. I spent 20 minutes with a resident, and 5 minutes with the dermatologist. The bill was $1335. An “insurance adjustment” knocked off $779. Insurance paid $438. I paid $118. The game goes on. We start with a fake sticker price to negotiate with the uninsured and to declare uncompensated care. But you cannot just walk in and pay as you can for anything else. Even $438 includes a huge cross-subsidy.

We’ll know we’ve fixed health care when we don’t get bills like this.
Sometimes, we can walk in.  Perhaps, though, we get hit with the $1335.  Or perhaps a counselor gives us a financial proctology, and we pay $438 or $125 or whatever a computer random number generator kicks out.

Medical savings accounts, catastrophic coverage, interstate sales of insurance, portability of insurance, greater commercial freedom for purveyors of pills and procedures.  Stat!

THE POWER OF URBAN AGGLOMERATION ECONOMIES.

The 2016 presidential vote stratified in a number of ways, including a preponderance of the Democratic vote originating in counties that generated a lot of national income, or perhaps it was a preponderance of national income originating in counties that generated a lot of Democratic votes.

Apparently, despite the loss of the blue collar aristocrats and the Marshallian entrepreneurial nexus for heavy industry, Milwaukee is again generating income.  Perhaps the shift from being a net recipient of state spending to a net contributor to state revenues reflects Wisconsin fiscal policies that have changed from 2009 to the present, or perhaps there's new life in new commercial ventures.  And perhaps there are new agglomeration economies for future researchers to investigate.