Sunday, November 17, 2019

Good Effort

French marketplace

To start with, I am a convinced free-market capitalist, so this meditation is going to sound biased to some ears. I believe that people are individuals with free agency,1 and so they are the best judges of how to spend their hard-earned money: on which goods, what quality of goods, what level of service, and what place of purchase. They are also the best judges of which jobs they want to or can do, how much effort they will put in, and what place of employment will best suit them. I believe that people make an honest choice between Starbucks and Peet’s Coffee, and that this is their own business.

I also believe that shareholder capitalism, as it’s currently practiced, is the most democratic method of funding an economy. People put their savings—their nest eggs, their windfalls, and their 401ks and pension plans—into stock shares and bonds, or manage them through a financial services advisor, and this money fuels economic development. People invest their savings where they feel comfortable, have the most trust, or share a vision. And the essence, here as in the marketplace, is that a million individuals are making a million decisions that seem right to them—as individuals.

With a bachelor’s degree in English literature, my first job out of college—obtained through the good graces of one of my professors—was as a junior editor at the Pennsylvania State University Press. It was there I learned my first real trade and became a successful editor and writer. Unlike most university presses, the director and senior editor tried to publish valuable works that would sell in the marketplace of ideas—rather than simply functioning as a publishing service for the university’s own scholars. That is, they expected most of their list of books to earn a return in sales. And I was treated like any editor in traditional publishing: I had to perform to a work flow; maintain high standards of manuscript preparation, galley proofing, and overall timeliness; and earn my paycheck each month. But at the end of that year, when the Commonwealth of Pennsylvania experienced a $400 million budget shortfall during the recession of 1970, and it was a choice between plowing the roads and paying the salaries of junior editors and adjunct professors at the state university, I was let go. Good effort on my part and on the part of the university press management was not enough. For all their market savvy, the Penn State Press lived or died by allocations from the state budget.

After that experience, I went to work in the private sector. First, I was a trade-book editor at Howell-North Books, correcting manuscripts of railroad history and Californiana for a market that was interested enough in railroads and California history to pay for our books. Next, I went to be a technical editor at Kaiser Engineers, producing engineering proposals and reports for million-dollar projects on drop-dead schedules. Quality, speed, and responsiveness to customer expectations and requests not only earned my paycheck at these places but offered advancement in the organization. The budget was under our own control, not the number-crunchers back in the state capital.

My late wife graduated with a degree in history but, in the economic environment of 1960s San Francisco, the best job she could find was in the typing pool at Western Greyhound’s downtown offices. All her acquired knowledge and historical insights didn’t count so much as her typing speed. She quickly tired of being just a set of fingers, obtained her Master’s in Library Science, and went to work for the prestigious Bancroft Library on the University of California Berkeley campus. She stayed there until retiring almost three decades later as Head of Public Services. Every year, the Bancroft director had to fight for budget allocations against the rest of the library system and the university as a whole. Every year, my wife had to figure out how to maintain the collection and provide access to scholars using only the staff and budget she was given. Good effort were important but not sufficient for success.

I believe that people are pretty much the same, whether they work in private business or the public sector. Everyone—almost everyone, that is—gets up in the morning and wants to do a good job. They want to be productive, get smiles and thanks from their customers, however they define them, feel they’ve done something worthwhile at the end of the day, and earn their paycheck at the end of the month.

For ten years in the 1980s, I worked in Corporate Communications for Pacific Gas & Electric Company. Yes, that PG&E, which has recently been shutting off power to wide swaths of Northern California because their aged equipment and ill-maintained rights of way have started horrendous wildfires. People affected by these “public safety power shutoffs” blame the company for misallocating funds, skimping on maintenance and using the money instead for management bonuses, and generally goofing off at all levels. But while the company may have made mistakes, it is not run by fools and wastrels. When I worked there, PG&E people prided themselves on providing reliable service, maintaining a tight system, and keeping the lights on and the gas flowing.

What most people don’t realize is that PG&E—and any other regulated utility—is not exactly a private-sector business. When I first got there, I once used the word “profit.” Oh, no, no! I was told, by no one less than the chairman himself: “We earn an authorized return on investment.” That is, the shareholders put up their money—the result of selling PG&E stock in the equities market—to build new plant and facilities. In return, the California Public Utilities Commission (CPUC) grants them money taken out of rates to pay back that investment plus a designated percentage return—which is usually a bit higher than one could make on bank savings or would pay on a bank loan. To earn this return, the plant has to be “used and useful”; so the company cannot just build redundant and overlapping facilities and make money on them.

But aside from new buildings, power plants and gas pumping stations, powerlines and gas transmission lines, every other aspect of the gas and electric business was and is a “passthrough” in the rates the company charges. PG&E buys fuel and natural gas, wire and pipe, line trucks and equipment, tools and office supplies, and made not a penny on the sale of electricity and gas over and above the cost of these expenses. PG&E employed 23,000 people, at the time I worked there, but makes not a penny on their efforts above their regular salaries, benefits, and stipulated bonus programs. A customer service rep’s smile earns neither her nor the company not a penny more in rates.

Instead, the company goes to the CPUC every three years with the “rate case.” This is a showing before an administrative law judge (ALJ), who is also employed by the CPUC, as to what the company needs in customer payments in order to provide electricity and gas to customers in its service territory: so pipe and wire, so many trucks, so many people, so much for system maintenance, so much for clearing trees and brush in the powerline rights of way. And the CPUC staff faces the company lawyers as opposing counsel to challenge every article in the rate case in order to hold rates to what they believe is “fair and reasonable.” In the end, the ALJ and the CPUC decide what PG&E can spend in each category and recover in rates. And the CPUC keeps close tabs on PG&E’s books, so that if the company were stinting on maintenance and tree cutting but then paying out extra into management bonuses, the hammer would come down pretty quickly.

PG&E employees—at least when I worked there—wanted to give good service, keep the lights on, and make their service territory a good place to live. But they are not stupid. They know that, unlike a Starbucks or Peet’s Coffee—where good products in a wide selection, and good service with a lot smiles, can keep customers coming back, because they have a choice—the average PG&E customer has no real choice of provider, will pay what the state commission decrees in rates, and will get the level of service that wiser heads in San Francisco will allow.

Everyone, most everyone, wants to do a good job, but they are also aware of the internal and external incentives. They know how much control they have over outcomes. And when choice of products and services is nonexistent and the outcome is predetermined by number-crunchers far off and far up the line, then selection and service suffer. Putting that control over valuable public goods and services into fewer hands and at even greater distance—whether through stricter and more complex public oversight and regulation, public takeover of service providers, or outright government control of production—is not the key to public happiness. Or so I believe.

1. See A Classic Liberal from December 2, 2018.

Sunday, November 10, 2019

Allergic to Chaos

Mandelbrot fractal

Mandelbrot fractal

The other night I attended a concert by the San Francisco Chamber Orchestra.1 While the music was excellent, I had a “disconcerting” moment in the prelude, during the time that the audience was still filing into the auditorium and finding their seats. Rather than a curtain coming up on the whole ensemble of 36 players seated and ready to start, the stage began with empty chairs and music stands. Then, one by one, at intervals of about a minute, each player entered, took his or her seat, and began playing … something.

What each player was doing seemed like random practice: trying out a series of chords, working out a difficult passage in the evening’s music, or just tuning up the instrument. The point is, the playing was totally uncoordinated, bits and pieces rising and falling without any linkage. At one point, I turned to my companion in the audience and quipped, “I suppose they do this so it will sound better when they all start playing together.” It wasn’t quite cacophony,2 because each fragment was a nice bit of music in itself, when I could isolate it, and the overall effect lacked the crash of garbage cans, swell of police sirens, and screech of brakes. But it wasn’t exactly pleasant.

In fact, after a few minutes, I began to feel a certain discomfort, then anxiety, depression, and other negative symptoms. I actually tried to close my ears with my fingers at one point. And this reaction reminded me of something I knew long ago: that I am allergic to chaos.

This isn’t just a philosophical or political aversion. I’m not making a statement here. I just can’t stand a prolonged state of disorder, without pattern, without sense or direction. And I don’t suppose many people can—or not without suffering negative symptoms such as I did.

You would think that I then must hate nature, which is itself fairly chaotic. But within the movements and displays of the natural world, there is generally a pattern that can be discerned in one pays attention over time. The wind in the trees, the falling of leaves or blowing of snow, the ripples in sand dunes … all are patterned. Each trunk and limb in the forest can bend only so far, and then it must bend back, so that the swaying of the trees has a regular span and rhythm. Each wave on the beach is followed by another in a regular succession. Birds migrate with the seasons. Bees swarm and then find their hive. Night follows day follows night. The Moon progresses in its phases, and shooting stars come in orderly streaks from a focal point in the sky. Even the eruptions of volcanos and their lava flows tend to follow a pattern over time.

The trouble is that, given a patternless chaos, my brain automatically tries to make order and sense of it. I try to find a pattern, at some level, large or small, like the inner workings and infinite regression of a Mandelbrot fractal. I do this even when I know there is no pattern and can be no pattern. That night at the concert I knew and understood that all of this musical nonsense and not-quite-noise intentionally held no pattern. And yet my brain tried to make music out of it.

This may explain why I am made nervous in crowds—aside from the obvious possibility of a mob breaking out and carrying me off screaming—or in packed spaces like restaurants and, ahem, theaters before a show starts. There can be found patternless voices, snatches of conversation, and random bumps and thuds. There chaos hangs in the air, mutters and teases at my ear, and sends my brain into fits trying to isolate snippets and make sense of the loose and vacant chatter.

This may also explain why I am made nervous by the laser light shows that generally accompany rock concerts as well as by the jumble of flashes and bangs that generally form the “blowoff” ending to a fireworks display. One, two, or three rockets exploding together and mixing their starbursts and showers, or the calmly rotating reflections of a disco ball … these are agreeably patterned. The sporadic lightning and booming of twenty rockets going off at once, or the artfully programmed confusion of light beams swirling, swooping, and dancing on smoke … that’s nervous-making.

While I am a dedicated wargamer and love the simulated strategic problems of a miniatures battle or board game, I would hate being in a real war. Even when an opposing gamer makes a surprise move—and it’s interesting how, at the height of battle, the reactions of other players are generally not all that surprising—the situation is still somewhat controlled. We have rules in each gaming system about how far rifles and artillery can fire, how far a unit of troops or vehicles may advance in any one turn, and what sequence of play each side must follow. The progression is orderly if not exactly predictable. But in the real thing—and I know this from having played paintball, which is a lifelike tactical engagement, with all its crawling around in the dirt trying to find cover, except that plastic shells filled with water-soluble paint replace actual lead bullets—fire comes in from all sides, intermittently, without any sequence or pattern. You lift your head to look one way and—splat! A sniper who’s been watching your position has just torn open your skull. Surprise, you’re dead! My brain hates that! There is no way to predict disaster and guard against it.

But all of this is not to say that I hate uncertainty. That is a different thing. I am quite comfortable with unanswered questions, like the nature of God, the origins of life, the conspiracy behind the Kennedy assassination, and other situations that may or may not be ultimately knowable but right now are open to question and speculation. In fact, I am more comfortable with a complex uncertainty (e.g., how do those mutant geniuses manage to solve Rubik’s Cube with just a few twists?) than I ever would be with a simple but possibly wrong or inadequate answer (e.g., God said it, the Bible records it, I believe it, that settles it). I can tease out and isolate the uncertainties and missing pieces of an argument or line of reasoning. I don’t have to squash or answer them. My brain is satisfied with just knowing where the potholes are.

But in a flood of random sounds or the flash of random lights—think of the display of little twinkling bulbs that 1950s television shows used in a display panel to suggest a computer at work—I am bothered because the signal becomes indistinguishable from the noise. You cannot isolate and examine uncertainty when an overall pattern does not even give you a framework to begin analyzing.

So, while the chamber orchestra may have found an interesting and dynamic way of bringing the concert experience into focus, they also point to a certain weakness. Thank goodness, this group plays mostly classical works that celebrate order, transition, and resolution, rather than some of the more modern composers—here I’m looking at you, Shostakovich!3—whose works are sometimes indistinguishable from disorganized noise itself.

1. The program started with the Faust Overture by Emilie Mayer, a 19th-century German composer of whom I had not previously been aware. That was followed by the more familiar Fifth Symphony of Beethoven. The treat of the evening was hearing Music Director Ben Simon and various sections of the orchestra “disassemble” the Fifth to show how the composer used key changes, variations, and repetition to build this musical masterpiece.

2. If you break this word down linguistically, kak in Greek means “bad,” and phonia means “sound.” So this is—now from Latin roots—dissonance or “bad sound.” Given how kak and its variations are usually rendered in many languages, it could also be “shit sound.”

3. Although I am partial to his Symphony No. 10, particularly the rousing and martial Second Movement.

Sunday, November 3, 2019

The Magic of Steel

Samurai swordmaking

About a dozen years ago, I tried to by a steel rod that I could use in my karate training as a bo staff. This karate weapon is like the ancient quarterstaff that Robin Hood and his forest band used, but much faster and in greater combinations of moves. Even though the word “bo” means wood, I already had staffs made of fiberglass and aluminum. I figured a weapon made of solid steel would be unbreakable and invincible. So I looked up a steel fabricator online, called them, and tried to place my order.

“What are your specifications?” the polite woman on the sales desk asked me.

“Oh, I want a rod about six feet long and half an inch to an inch in diameter,” I said.

“You don’t understand,” she said. “What are your specifications for the steel?”

Ah! Well. Um … I did know what she was talking about. Any aficionado of pocket knives who peruses the catalogs knows a bit about Rockwell hardness, edge holding capability, rust resistance, and so forth. But what did I want in a staff?

When I was growing up and became interested in knives as both tools and weapons, as well as kitchen utensils, I asked my father—a mechanical engineer who had to be familiar with the properties of various metals—why we didn’t have stainless steel pocket knives. He said that stainless steel was too soft, with a consistency more like stiff taffy, and it could not be ground to take and hold an edge. Nowadays, however, through the work of chemists and steelmakers, we have stainless blades that are as strong as carbon steel, just as good at edge holding, and yet rust free.

In the end, I asked the steel fabricator for a rod of the most “vanilla” metal they had, middle of the road on all specification, except for stainless. They sent me two in the order, and I still have them. But just unpacking the things, I knew I had made a mistake. A six-foot rod of one-inch diameter weighs about thirteen pounds—far too heavy to swing at the speeds of any bo kata and still hold onto. One slip and it would go flying across the room. Still, the experience of purchasing a steel bo had been instructive.

I have long thought it a shame that this country buys most of its steel from China, Japan, and even India. The company called “U.S. Steel” used to be one of the powerhouses of our country’s industry. Steel is the metal of civilization. It’s what we use to build bridges and skyscrapers. It’s the rebar in every concrete structure. It’s the main ingredient in our automobiles, still ahead of aluminum, plastic, and carbon fiber. That we apparently don’t make it anymore, that we rely on overseas, practically Third World countries to supply our steel is a shame.

But it’s not that we don’t make steel in this country. We just don’t make large volumes of non-specific steel for I-beams, rebar, and other general utility purposes. We let the Japanese, the Chinese, or whoever else wants to build a plain old steel mill do that. Instead—as my father knew back in the 1960s and ’70s—we are the world’s leader in specialty steels, metals with specific qualities of hardness, ductility, flexibility, compression strength, rust resistance, and other measures of performance that are dictated by the composition of metal additives in the steel, its carbon content, its treatment, and its finishing.

For example, ball bearings must be extremely hard steel, because they work under the pressure of weight loads, but that kind of steel can be fairly brittle. Tool steel, the sort that goes into drill bits and chisels, must be extremely durable but also shock resistant, because they may be used to cut and shape other metals, including lesser steels. A knife blade has to be durable to stand up to shocks, hard enough to hold an edge, but also ideally resistant to rust in daily use and just sitting in your pocket, where it becomes subject to the moisture surrounding your body.

So when we speak of steel anymore, think of chocolate. The most popular brand in this country, the kind you get out of vending machines—the kind that’s made in great bubbling vats, distributed in boxcar lots, and sold everywhere—is Hershey’s. It’s not bad chocolate, as far as milk chocolate goes. But it’s not special. And it does have a sort of grittiness and leave an oily feeling in the mouth that children don’t mind but that connoisseurs care about. This is bulk chocolate—not the kind they use in making truffles or gift boxes with assorted flavors and fillings. If you want something special, with a particular texture, flavor, cacao content, and so on, you go to a premium chocolatier. The Swiss make fine chocolates for the discriminating baker and the customer’s palette; they let the U.S. pour out vats of Hershey’s milk chocolate.

The Swiss are to chocolate what America has become to steel: the experts in taste and quality.

Being a karate buff and an admirer of oriental martial arts, I used to think that the highest quality of steel—the magical stuff that can cut through anything, hold an edge forever, and never be bent or broken—was found in the samurai sword. We’re not talking about the swords that the Empire turned out by the carload for junior officers at the end of the war, usually cut and hammered from truck leaf springs. No, I’m talking about the ancient art of the sword as practiced by Japanese smiths for centuries—the kind that The Bride sought from Hattori Hanzo in the Kill Bill movies.

The Japanese have made samurai swords for hundreds of years. They work and fold, work and fold the steel, over and over again, to give it strength. They make a certain kind of steel with toughness and flexibility for the back of the blade, and another kind that can be ground sharp and stay sharp for the steel along the edge. These two are then put together: the edge steel in a groove that has been shaped into an ingot of the back steel. The combined blade is then pounded into shape while red hot to weld the steels together, then plunged into water or oil to temper them. The different steels react differently to the sudden temperature change, with the blade steel extending and the back steel contracting at different rates. This bends the blade backward and gives the sword its characteristic curve.

Layering the steel to give it strength, which the Arab and Spanish steelmakers did with Damascus steel, is an old trick.1 But it is only really needed when working with low quality steel that contains a lot of impurities. The Japanese swordmaking artisans would smelt a large lump of steel for just one or two blades in a backyard kiln made of bricks and fired with charcoal. It’s a creative and humanistic approach, requiring great knowledge and the skills acquired through centuries of trial and error and passed down from master to pupil. But the process lacks the precise, scientific control of a modern blast furnace. So these artisans had to layer their steel to drive out the impurities with repeated hammering and to give the steel the strength of many welded bands. A modern steelmaker only makes Damascus steel for show now, not for any inherently superior strength.

Steel has almost magical properties of strength, hardness, durability, and now resistance to corrosion and other specifications. These qualities have made it the favorite of tool makers and armorers over the centuries and to builders and engine makers in the last two hundred years. It was even chosen as his party name by a world leader, Stalin. But anymore, when you think of steel, think of chocolate.

1. It was the Arabs of Damascus, in ancient Syria, who are supposed to have invented this work-and-fold technique of forging, and so they gave this particular kind of patterned steel its name. The Moors brought the technique into Spain, which was also known for its fine steel blades. Tradition says the Damascus steelmakers didn’t temper their red hot blades in water or oil but instead plunged them into the bodies of slaves, to temper them in blood. But that is probably a myth.