Saturday, October 26, 2013

When We Want To— We Can Do It

Before the actual beginning of World War II, the United States began preparing for a war that many thought was inevitable.  We enlarged the army and began stockpiling the supplies that we thought would be necessary to fight the war.  Despite good intentions, these preparation were almost laughable.

When the war started, the army had 37 divisions—about 12% of the size of the eventual army—and we had enough supplies stockpiled for only one division to fight.  This was woefully inadequate, but the government quickly turned to mobilizing our industries to produce the supplies necessary to prosecute the war.

During the next three and a half years, wartime production was astounding.  Do you have any idea what a 1942 Chevrolet looked like?  It looked exactly like a 1942 Ford.  It had treads and a 75mm cannon.  Singer sewing machines came in .45 caliber.  Typewriter companies--many of which had gotten their start producing firearms during the Civil War--returned to their historic roots by making pistols and carbines.  Most existing industries shifted over to producing the materiel the military desperately needed.

The production numbers were staggering.  During the war, this country produced 86,000 tanks and we  built 297,000 airplanes and trained a vast army of young men to fly them.  (To put that number in perspective, that's about 50 times the size of the present US Air Force).  We also built machine guns for those planes and tanks (One estimate puts the total number of machine guns built at 4 million.)  This is in addition to the 15 million rifles we manufactured during the war years.

Besides tanks, we built 2 million army trucks and 640,000 jeeps—about a third of which were donated to our allies.  And of course, we made the tires and parts to maintain those jeeps, too.  To keep up with production, at one point we shipped an entire Ford production plant to Russia, set it up, and began manufacturing vehicles there.

And ships!--did we ever make ships!  During just the war years, we made 64,000 landing craft and 6,500 ships.  We built sixteen aircraft carriers and 288 submarines during the war.  And one man, Henry Kaiser, astounded the world by producing 747 large cargo ships.  Despite the fact that Kaiser knew so little about ship design that even by the end of the war he was still referring to the “left” and “right” sides of a ship, he certainly understood construction and mass production!

Building new shipyards and using innovative methods, he shortened production time to unbelievable levels.  The keel for the USS Robert E. Peary (DE-132, a 306-ft destroyer escort), was laid on Sunday, November 8, 1942 and the ship was launched 4 days, 15 hours later.  This cut almost six days off the previous record, also set by Henry Kaiser.

Those new dockyards attracted workers by the thousands, and health care for these workers also had to be provided.  Here, too, Kaiser was innovative.  He started the first HMO to care for his employees.  Seventy years later, the country’s largest HMO is still Kaiser Permanente.

Clothing companies made uniforms, shoe companies made boots, publishing companies made military manuals—and all of this production was numbered in the tens of millions.  There is simply no way to estimate the number of military bases, camps, and government buildings constructed during the war.  We can note, however, that the Pentagon was started in 1941 and finished in 1942 (no mean task for a building of 3.7 million square feet!).

During those three and a half years, the country created 7 million new jobs and trained the men--and women, whose presence in the work force doubled during the same time—to handle these jobs. (This is in addition to the 16 million men in uniform.)

It is important to remember that all of this production was of very high quality and subject to constant innovation and improvement.  Take the example of aviation:  at the beginning of the war, many military planes were still biplanes and Orville Wright was still alive.  By the end of the war, pilots were flying both jet and rocket planes.  Wright made his last flight during the war--in a Lockheed Constellation--piloted by Howard Hughes.  No one knows if Wright got to take the controls at all, but we do know that he made the observation that the Constellation's wingspan was longer than his first flight had been just 41 years earlier.

But, that was 70 years ago.  What happened?  Today, in slightly more time than the duration of World War II, our government seems to have hit its operational limit at producing a web page which--as I write this--still cannot verify my existence, despite my having paid income taxes for half a century.  I'm not convinced that our nation needs a national health care system, but if we must have one, let's do it superbly.

Where is Henry Kaiser when we need him?

Saturday, October 19, 2013

Musings Over a Martini

The old Islander Beach Hotel, a sprawling, massive hulk on Galveston Island, was owned by a large family, who lived in a suite of rooms there.  While I ran the hotel itself, the owner requested that I allow his aging mother to "manage" the many snack vending machines on the property.  He wanted to keep her busy and out of his hair, while at the same time giving her the illusion of being useful.

Having to collect the money, periodically restock the machines, and order the assorted chips, pretzels, and cookies was a job that I thought was a pain in the ass, so, if the 80-year old grandmother wanted to play with the machines, I thought it was a great idea.

To be fair, the elderly woman really worked at the job.  As fast as someone bought a bag of peanuts, she restocked that machine and removed the coins.  And she kept meticulous records--how much of each item was sold per day by each machine.  After about a month of this, she told me (confidentially) that Lays Plain Potato Chips were our best sellers.  I tried to look pleased, even though I couldn't have cared less.  I think that was the same week I learned that one of the engineers "thought" he saw a coral snake in the basement.  I would rather have had 50 "real snakes" than one "maybe snake"--if for no other reason that eventually you will find all the real ones.

Almost immediately, I forgot about the potato chips--at least until the morning, when I walked by one of the machines and stopped and stared: It was filled with Lays Plain Potato Chips--and nothing but Lays Plain Potato Chips.  A quick search of the other machines revealed that they, too, all were stocked exclusively with Lays Plain Potato Chips!

Obviously, my helpful granny had decided that since those chips were the best seller, they were all we needed to sell.  Two weeks later, she was completely mystified because sales had all but stopped.  Not only were total sales down, but we were actually selling fewer Lays Plain Potato Chips than we had before.    Granny could not (and never did) understand that it was the variety of snacks available that attracted customers, even if they eventually usually settled for just plain chips.

Lately, it seems that government doesn't understand a free market any better than Granny understood about those chips.  You cannot lower prices by controlling a market.  While this has been tried many times, the inevitable results are higher prices and shortages.  Whether you call government controls "price freezes" or a "socialized market", they never work.

The only arrangement in history that has consistently led to lower prices and improved quality at the same time is an open and free competitive market.

Competition and innovation--not government intervention--bring down prices.  Brain power--innovation prompted by the opportunity to be amply rewarded--coupled with competition will always lower prices.  Force--and that is the nature of all government intervention--invariably fails at this.

A sad corollary of this rule is that innovation occurs where it is most rewarded.  Free markets prompt innovation, while a centrally-planned economy is slow to reward innovation and is therefore slow to change.  It is for this reason that here in the United States, Hewlett-Packard files more patent applications a week than some countries will see filed in their stagnant patent offices in a year.  Over half the patents in the world last year came from either the United States or Japan.  And no one in the world is reading this on a new computer developed in Saudi Arabia.

Remember the Space Race?  Did NASA put a man on the moon?  Or was it thousands of contractors bent on profit, each designing and competing for the contract to build the lunar lander and other components?  If I remember right, it was North American Aviation that built that landing module, after a competition with every other aviation company in America.  Exactly what has the US Government designed?  Tax forms?

The urge to have a centrally-planned economy is understandable.  The free market sometimes appears to have incredible waste and duplication, and is by its very nature chaotic.  For every winner, there are a dozen losers.  It would seem so much simpler and more efficient to have the government take over all planning and enforce low cost standardization.

For example, the next time you are in a grocery store, find the condiment section and look at all the kinds of olives for sale.  There are cheap olives, some expensive brands, so many kinds and varieties, and so many different sizes of jars and cans.  The temptation to lower cost and preserve quality by imposing a government standard is very real and understandable.   Couldn't we just lower the cost for all consumers by limiting the selection and standardizing production, thus maintaining the highest quality for the price?

No!  Every time in history this has been tried, sales go down because some people don't want plain potato chips. (Or plain olives).  And as sales go down, eventually the cost will go up and quality will drop.

No matter how much we desire to control a market, even supposedly for the sake of the consumer--the surest road to a fair price and high quality is to leave the market alone.  Besides, I like anchovy-stuffed olives in my martinis.

Saturday, October 12, 2013

Dear Alice

How is my first favorite granddaughter?  I have a story for you, and since this letter is sent to you inside a book, I bet you have already guessed what the story is about.  Do you sometimes think your grandfather is crazy about books?  It's okay if you do, since your father has told me that for years and years and years.

When I was ten years old, I borrowed a book from the Ft. Worth Library bookmobile.  The bookmobile was a special bus full of books that would drive around to towns that were too small to have their own library.  I still think that bookmobiles may be the best thing that has been invented since the printing press.  I read once that Mexico had built special wooden boxes of books that could be strapped on the backs of mules so that books could be taken to children who lived in the bottom of a deep canyons.  Would you call that a BookMoMule?  We will have to talk about that someday.

Well, the book I found in the bookmobile was Binkie's Billions, a book about a boy with a pet ostrich.

Unfortunately, I lost the book before I could finish reading it.  Since I had checked it out, I had to pay the library for the lost book.   I looked and looked, but I never found the book.  And the library did not have another copy--so I could not finish reading the book. 

I never forgot the book, so it bothered me that I didn't know how the book ended.  Did Binkie get to keep the ostrich?  Did his grandmother lose their house to the bank?  How was I ever going to find out what happened?

Reading a book is like making new friends and not finishing a book is like being rude to your new friend.  You want to know what happened to him.

I looked for a copy of the book in bookstores and libraries all over the country, but no matter where I looked, no one had a copy for me to read.  It sounds silly, but even as I got older, I really wanted to finish that book.  I could remember exactly what chapter I had been reading when I lost the book.

Once, I got pretty close.  I was at the Library of Congress in Washington DC.  This is one of the largest libraries in the world.  I checked the card catalog and they had a copy!  You can't take books out of this library, you can only read them while you are in the library.  When the librarian brought me the copy, I couldn't believe it--Binkie's Billions!  It had the same blue cover with the picture of a boy and an ostrich--exactly how I remembered it!

Unfortunately, I didn't have time to read it.  I was visiting the library with a group of people who didn't want to sit in a library, waiting while a grown man read a book written for kids.  (They were looking at me like I was crazy.  Over the years, I have gotten used to that.)  Washington DC is full of lots of wonderful museums and art galleries and the people I was with wanted to go see them instead of waiting while I read the last 100 pages of the book.

Then I had an idea, I could just read the last chapter of the book!  Then I would know how the story ended--what happened to Binkie.  More importantly, I could stop thinking about the book--not having finished reading that book had bothered me for years, now I could quickly read the last seven pages and finally, at long last, forget the book.

But skipping to the last chapter of a book is wrong. You are cheating the author of a chance to tell the whole story.  Skipping to the last chapter of a book is a sin that earns you a spot in a special place in Hell--a place that is normally reserved for people who talk in movie theaters or for graduate students who don't do their homework.

Fifty years after I lost the book, I found another copy.  A library was selling off a lot of old books and one was Binkie's Billions.   I bought the book immediately.  And today, it came in the mail.  If you look inside the front cover, you will find the card the library used to keep track of all the books they loan out.  Lots of boys and girls read the book from 1954 to 1964.  Then for ten years, only one person checked the book out.  And no one read it after 1974.  I wonder why?  Did people get tired of ostriches?  Did they only want to read books about space ships and magic?  I don't know.

Evidently, the book sat on a shelf for years and years and years, with no one caring enough about Binkie to read his story.  But I got the book today and I immediately sat down and read it from the first page to the end.  Fifty years after I started the book, now, I finally know what happened to Binkie and his ostrich.  I could tell you what happened, but then we would both go to that special place in Hell.  You'll have to read it for yourself.  I bet it doesn't take you fifty years to finish the book.

I think you will like Binkie.  And I'll give you one small hint:  the ostrich's name is George.

Saturday, October 5, 2013

Run, Chicken, Run

A man was driving down a country road one day when he happened to glance in the rear view mirror.  There was a chicken running down the road as fast as greased lightning.  In no time at all, the chicken caught up with the car and began to actually pass it!

The man glanced down at the speedometer and couldn't believe his eyes.  He was driving at 35 miles an hour, and was about to be passed by a chicken!  Even more amazing, as the feathered fury began to pass him, he was startled to see that the bird had three legs!

Fascinated, he sped up and stayed right behind the rapid rooster and followed him to a lonely farm house.  As he pulled to a stop, he saw a farmer standing near the chicken coop.

"Is that amazing bird yours?", he asked.

"Yep." said the farmer.  "Been cross-breeding them for years."


The farmer took off his hat, leaned back against the chicken coop as he scratched the back of his head and said, "Well...  I like the drumstick best and so does Ma.  Then Junior came along and he wants a drumstick, too.
Three-legged chickens just seemed the easiest way."

The man was impressed.  "How do they taste?", he asked.

The farmer put his hat back on his head, stood tall, and looked the man straight in the eye.  "Wouldn't rightly know." he said.  "Ain't caught one yet."

Enema U has lost a whole bunch more football games.  So many that we have become something of a national joke on television.  Earlier in the year, one of our regents wrote a letter to the local paper stating that it was through football that the university would establish a "brand".  It turns out that he was right--we have established a brand.  We are somewhere between the Exxon Valdez and Lehman Brothers, with a small dash of Lindsey Lohan. 

God knows we can't blame the athletes--they didn't schedule three "blood" games in one season.  They aren't the ones who transfer over $4 million a year from Academics to supplement an already bloated athletic budget.  And they aren't the ones who have decided to start offering cash incentives to bribe students into a stadium they clearly want to avoid--despite receiving free tickets.

Academics versus athletics is an old argument.  (Is it actually an argument when you have to repeat simple truths endlessly to idiots, in the futile hope that eventually they will understand?) 

No--Just for a moment, let's try to see this discussion from the regent's point of view. Let us pretend that we finally caught the fast fowl and that Enema U had a winning season.  Now what? 

It won't make us any money.  The program wouldn't show a profit even if every seat in the stands were full and every fan had someone sitting in his (or her) lap.  Do the math: The stadium holds 30,000 people, the tickets cost $20, and we have--at most--eight home games.    After the 15,000 students get in for free, you still don't fully fund the football program.  (Regents?  If this is confusing, print it out and take it to your next book burning.  Maybe someone can help you with the big words.)

If the team suddenly starts winning, the regents won't want to cut the funding--meaning that most of the academic departments will continue their efforts to be sponsored by fly-covered children in Africa.  The laws of athletic funding are simple: When they lose--they need more money.  When they win--they deserve more funding.

Will university enrollment go up if we start winning?  The regents obviously think so, but if this is true, what attracts the students we have now?  If our current students enrolled at Enema U for its current team--they have to be idiots.  If we start winning, will we lose our base?  What kind of student picks a university based on its football team anyway?

Will a winning season mean the library once again can subscribe to the missing journals that we need?  Will there suddenly be enough classrooms?  Can we afford to hire enough faculty?  Just exactly what will change at Enema U if we suddenly have a vibrant football season?

I understand that our university president remembers college athletics from the days when cars had fins, televisions were black and white, mothers stayed home with the kids, and our president spent most of his time on the golf course.  Times have changed and only the last item is still true.  It is okay if the university changes too.  Quit trying to catch the chicken!

Here's a suggestion:  Why don't we try to make everyone happy?  If we drop down a division, Enema U would win more games, it would cost a hell of a lot less, and the team would consist of more locals--a move that would guarantee more community support.  This small change would guarantee that everyone would be happy.  The regents could continue to relive a past that probably never was and the rest of the school could afford to stop holding bake sales to fund research.

We could make everyone happy.  Kind of reminds me of a veterinarian we used to have back home.  He was a pretty good animal doc and an even better taxidermist.  It was always kind of reassuring that no matter what, you were gonna' get your dog back.