Thursday, January 21, 2016

On Production Costs, or, the $350,000,000 Saturn

A fun fact from NDIA might put the cost of some defense systems in context, especially for dramatically reduced orders:
While working on the B-2 bomber, [Tom Vice, president of Northrop Grumman Aerospace Systems] recalls, the company studied General Motors’ production process for introducing its new Saturn line and estimated that if only 20 cars had been built, each would have cost $350 million.
In the case of the B-2, this happened:
The company set up an assembly line in a one million square-feet facility to build 132 bombers, but the order was truncated to 21. The poor economies of scale inflated the price of the aircraft to about $2 billion each.
The fixed costs of production (designs, machinery, tools, etc.) have to be covered by what is actually produced, whether 20 or 20,000.

Wednesday, January 20, 2016

2,431 Words, Not One of Which Was "Federalism"

In the New York Times, Thomas Edsall tries to find the mysterious explanation of how Republicans could possibly be successful at the state level in recent years. The divisive president is overlooked, but Charles and David Koch are referenced nine times. Most notable, however, is the omission of the one simple advantage that Republicans have over Democrats at the state level: an interest in federalism (the division of power between states and the central, or federal, government).

The closest he comes is to note, referencing an interview with a liberal strategist
the right can tap into an embedded structure of community-based cultural, religious, social organizations — churches, Elks, veterans halls, gun groups, local business organizations, etc. — that are gathering places with offices, meeting halls, phones and computers that can be used by activist troops for logistical and operational support.
Or, put another way, Republicans are more involved in their communities than Democrats.

Federalism is central to the difference between Democrats and Republicans. Democrats as a party believe in central planning and dictates from the capital (e.g., ObamaCare), while Republicans are more likely to encourage states to solve their own problems and learn from each other (even RomneyCare would seem to fit here). That is a natural advantage at the local level. Republicans are more inclined to look for local solutions while Democrats pray to DC for theirs.

For example, an article in The Atlantic about the future of work as automation increases was useful when it stayed on topic, but went on to propose a "national policy that directed money toward [community] centers in distressed areas..." A Republican would be more likely to say, "we need a community center in our community--let's build it." than to suggest laundering money through Washington, DC where bureaucrats could choose which community centers to fund among the thousands of communities.

Who is more appealing: the candidate who wants the community to build a community center or the one who promises to lobby the federal government for the return of laundered tax dollars to build a community center?

Monday, November 16, 2015

War Without Strategy

Amongst the last several days of calls for war and calls for peace, comics and hashtags, it has been difficult to articulate where the country, or the West, is right now. Mark Steyn, however, puts it well:
I have not called for more bombing raids, more boots on the ground, more war. Because, I regret to say, it's not worth brave soldiers "fighting, killing & dying" for a home front as enervated as ours. As I said a few hours ago, war is merely the sharpest tool of national strategy, and so, if you have no national strategy, there's no point going to war.
Why would anyone would expect a president who campaigned on it being wrong to remove a brutal, terrorist-supporting dictator in Iraq to lead a war to remove brutal terrorists from Iraq and Syria? Luckily, perhaps, we do not demonize the French when they take the lead.

Sunday, November 15, 2015

When is it Acceptable to Compliment Terrorists?

Minnesota's Star Tribune reports:
A [Minnesota Democrat's] campaign for the state House abruptly ended Sunday morning within hours of him posting on social media that ISIS "isn’t necessarily evil" and is "made up of people doing what they think is best for their community."
Washington state's Patty Murray made similar comments about Osama bin Laden in 2002:
He's been out in these countries for decades, building schools, building roads, building infrastructure, building day-care facilities, building health-care facilities, and the people are extremely grateful. He's made their lives better.
Murray did not resign. In fact, she subsequently chaired the Democratic Senatorial Campaign Committee and is currently the fifth-ranked Democrat in the US Senate.

Wednesday, November 11, 2015

A Dirty Bomb Doesn't Have to be Very Dirty

War on the Rocks has a pair of competing pieces on the threat of dirty bombs (Don't Fear the Dirty Bomb vs. Why I Fear the Dirty Bomb and You Should Too), but the second one has the most realistic view of how people would react. Regardless of the actual, scientifically-measurable risk, people will still be terrified:
Think of it as if somebody sprayed asbestos in your apartment building. No one would die and you could go in and out, but nobody would for fear of exposing themselves to cancer-causing agents.
Read the whole thing here--and remember, people are already afraid of irradiated food.

Monday, November 02, 2015

Can a State Mandate Financial Literacy?

From KELO, according to the Center for Financial Literacy:
South Dakota schools are receving [sic] an "F" in teaching students personal finance in high school... South Dakota requires high school students to take a half-year course in either personal finance or economics but does not require students to choose personal finance or require schools to offer personal finance.
These ratings appear to be based entirely on whether or not a high school personal finance course is required by law. Based on more well-rounded methodology, South Dakota was recently rated the 6th best state for Money-Savviness.

For the Center for Financial Literacy, it doesn't seem to matter whether students retain any knowledge of personal finance or learn it at home or independently, only if they were required by law to slog through a course before most of them even have any financial responsibilities which they can relate the course to. The takeaway: if you don't learn it in a government class, you never will.

I come from another F-rated state, Washington. We covered personal finance as a small part of another course, but that doesn't count as "financial literacy" because it wasn't required by law. It also would have been a serious waste of time to extend it out to a full semester. Personal finance is just not that complicated. Do we want to tell students that they can't take another year of a foreign language or calculus because the state mandates a full semester on why you shouldn't buy an iPad if you can't pay your rent? (And do we really think it will change them if we do?)

Monday, October 26, 2015

Rates are Higher on Unsecured Loans

Interests rates are higher on unsecured loans. That's really all there is to it.

Now, for the background: Socialist Senator and Democrat presidential candidate Bernie Sanders was quoted as saying, "It makes no sense that students and their parents pay higher interest rates for college than they pay for car loans or housing mortgages."

Robert Tracinski at the Federalist responds:
Why do car loans and mortgages have lower interest rates? They are secured by a tangible asset that can be reclaimed by the lender if the borrower stops paying. The bank can foreclose on your home or repossess your car, so they end up with an asset they can sell to recoup their losses. Rates on these loans are likely to be lower because the lender’s risk is lower. An education, by contrast, is not a tangible asset. It cannot be reclaimed and has no value other than to the person who acquired it.
He has graphs and stories and some economics to continue the story, and we could discuss how student loans drive up education costs, but secured vs. unsecured is really as far as we need to look for why the Sanders quote makes no sense.