Author Archives: R.E. Buxbaum

About R.E. Buxbaum

Robert Buxbaum is a life-long engineer, a product of New York's Brooklyn Technical High School, New York's Cooper Union to Science and Art, and Princeton University where he got a PhD in Chemical Engineering. From 1981 to 1991 he was a professor of Chemical Engineering at Michigan State, and now runs an engineering shop in Oak Park, outside of Detroit, Michigan. REB Research manufactures and sells hydrogen generation and purification equipment. He's married with 3 wonderful children who, he's told, would prefer to not be mentioned except by way of complete, unadulterated compliments. As of 2016, he's running to be the drain commissioner/ water resources commissioner of Oakland county.

May 1, St. Tammany day

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May 1 is St. Tammany day, a day to rejoice in the achievements of Tammany Hall, and of St Tammany, the guardian of crooked politicians everywhere. The Sons of St. Tammany started in 1773 as a charitable club of notable revolutionary-era individuals including Benjamin Franklin, John Hancock, and John Dickenson, but evolved into perhaps the most corrupt, and American, of political organizations. The picture of a US politician – the cartoon version at least — is the Tammany Democrat: a loud, drunken, womanizer, willing to do or promise whatever the people seem to want at the moment. Tammany and its bosses helped form this image. They helped new immigrants, but did so by creating needless government jobs, by filling them often with incompetent loyalists, and by overcharging on government contracts. Today, these Tammany ways rule in every major American city; the other clubs of the day are gone or influence-less.

John Hancock leads a meeting of the St. Tammany (Columbian) society. Note the "Appeal to Heaven flag and the Indian, real or imagined. Indians participated in several, early St. Tammany meetings.

John Hancock leads a meeting of the St. Tammany society. Note the “Appeal to Heaven” flag. While Indians participated in some, early meetings, the one here is, I suspect, a ghost: St. Tammany.

In revolutionary-era America, the Sons of St. Tammany was just one of many social-charitable clubs (Americans like to form clubs), in many ways it was similar to the Masons and the Cincinnati, but those clubs were international and elitist. The sons of Tammany was purely American, and anti-elitist. It was open to anyone born on this side of the Atlantic, and had Indian customs. The Cincinnati society, for comparison, started with members who were as notable (Alexander Hamilton, George Washington, Marie, Marquis de Lafayette, Henry Knox, etc.) but was originally open only to high officers of the regular army, including foreigners like Lafayette, but not ordinary soldiers, minutemen (militia), or the general public. The symbols of the Tammanies were American: the liberty-cap and the “Appeal to Heaven” flag, now a popular symbol of the Tea Party; the leader was called by an Indian name: Sachem. By contrast, the Cincinnati society symbol was the Imperial Eagle (Washington’s was gold with diamonds), and the leader was called “general”. The Tammany society began admitting immigrants in 1810 or so, while the Cincinnati society remains closed to this day, except to descendants of Revolutionary officers — an aristocratic affectation in the eyes of some.

It was Aaron Burr who first saw the opportunity to use the Tammany organization as a for-profit, political machine. In the years 1795-9, New York was suffering from yellow fever and a variety of other diseases that were taken to be caused by a lack of clean water. Burr proposed, with Tammany support, the creation of a corporation to build a new water system to bring fresh, clean water from the Bronx River to lower Manhattan via iron pipes. The Manhattan company was duly chartered, with directors who were primarily Tammany men, Republican-Democrats, and not Federalists. Federalists (Hamilton, primarily) controlled the only NY banks at the time and controlled the directorate of every chartered company in the city. The Manhattan company requested a $2,000,000 perpetual charter, twice as big as the charter of Hamilton’s Bank of New York, and a monopoly on water distribution. These were reasonable requests given the task, but unusual in the lack of Federalist or governmental oversight. But the Manhattan company was a water company, and water was needed. But Burr’s intent, all along, it seems was to build a bank, not a water company. After the charter was approved, but before signing, he amended it to allow any excess funds to be used for any legal purpose. 

In this cartoon by Dr. Seuss, The Tammany Tiger says, "Today is the Big Day Folks. Vote Early and Often."

In this cartoon by Dr. Seuss, The Tammany Tiger says, “Today is the Big Day Folks. Vote Early and Often.”

Money was raised, but only $100,000 used for the water system. The remaining 95% of the charter funds, $1,900,000, went to found “The Bank of The Manhattan company” — later to be known as “The Chase Manhattan Bank” or “The Manhattan Bank of Cholera.” Instead of building the reservoir in upper Manhattan and filling it with clean water as originally proposed, Burr’s Tammany trustees voted to dig wells in lower Manhattan, and placed its reservoir in lower Manhattan too, near Chamber’s St,  next to a cemetery where Cholera victims were buried. New York suffered with Cholera, Typhoid, and leaky, wooden pipes until 1842 when Peter Cooper brought clean water to lower Manhattan from the Groton River via iron pipes. To this day, crooked water contracts are a staple of Tammany politics. 

The Bank of the Manhattan company opened at 40 Wall St on September 1, 1799, a mere four months after the water company’s incorporation. Hamilton was furious. The company continues today as The JP Morgan, Chase Manhattan Bank, one of the largest banking institutions in the world. Burr used the money and power of his company to reward supporters and to run for vice president with Thomas Jefferson’s tacit support. Except for his Tammany candidacy, John Adams would have won New York and a second term as president. Burr’s career pretty-well died after the Hamilton duel, but Tammany did well without him. By 1812, the Society built its first Tammany Hall, officially called the Wigwam, a $55,000, five-story building with a meeting hall for 2000. New York Democratic politics would center on Tammany Hall for the next century at least.

Following disappointment with John Quincy Adams, “the bitter branch of the bitter tree,” Tammy leaders went national. They recruited Andrew Jackson, a war hero and early recruit of Burr’s. They’d support Jackson if he’d hand over spoils, control of government jobs. He agreed and, as president, fired perfectly good, long-standing government employees He replaced them with Democratic loyalists. When Jackson stepped down in 1833, Tammany elected an equally corrupt New Yorker, Martin van Buren. Though there were periodic Whig and Republican reforms, Tammany learned they could wait those out. They always re-emerged like mushrooms after a rain.

Boss Tweed and other Tammany leaders: who stole the money?

Boss Tweed and other Tammany leaders in a cartoon by Nast, Tammany Ring. “Who stole the money? He did.”  

A key vote-getter in the Tammany system is to provide Thanksgiving dinners and other charitable giveaways for the poor, as well as promises of jobs. By the late 1800s, William J. Brian added promises of soft money and wealth redistribution, cornerstones of the Democratic platform to this day. Tammany also tends to be for low tariffs as opposed to the high tariff ideas of Hamilton and many Whigs and 19th century Republicans. A case can be made for either view.

Tammany helped New York immigrants, particularly the Irish to get citizenship and avoid legal troubles in return for votes and occasional muscle. In other cities, Democratic clubs were less open to Catholics, reflecting the views of the common voter in each state. In the North they were pro-union, in the South anti, electing Klu Kluxers like George Wallace, Sam Ervin, and Robert Byrd. This lead to a famous split in the Democratic party about the 1968 convention. Famous Tammany leaders include William M. “Boss” Tweed, “Big” Tim Sullivan, and “Gentleman” Jimmy Walker. Sullivan famously authored the first anti-gun law, the Sullivan act; it was designed to protect his thugs against private citizens shooting them. It didn’t always work.

Edwin Edwards, Democratic Governor of Louisiana. 1972-1996. Who would not trust this man?

Hon. (?) Edwin Edwards, Governor of Louisiana. 1972-1996. Tammany lives

If you want to see Tammany politics in action, visit almost any large US city, or read its newspaper. In Chicago, the dead vote, and 4 of the last 6 governors have gone to jail. Mayor Daily famously told Kennedy that 90 percent of the registered voters of Cook County would vote for him. They did (sort of); because of this, JFK won Illinois and the presidency. In New York, voters discovered only in the 1960s that Tammany’s leader, Carmine DeSapio had been working for 30 years with known gangland murderer, Charles “Lucky” Luciano. In Detroit, where I live and corruption in the water department is legendary. Race-based job handouts, unemployment is high along with high minimum (living) wages. We’re now in the process of a $70,000,000 project to replace 100 feet of sewer pipe, and we’re building a $140 million, 3.3 mile trolley. Tammany loves all public works.

Then there is Louisiana, home to St Tammany parish. Louisiana Democrats like Huey Long and Edwin Edwards (shown at left) are unusual in that they’re proud to say that their corrupt methods are corrupt. Edwards has had two long runs as governor despite several convictions for doing illegal things he admits to doing. When Edwards was asked why he did favors for his friends. He responded: “Who should I do them for? My enemies?” Or, to quote one of Edwin Edwards campaign ads. Vote Edwin EdwardsPeople seem to love it, or did until the levy broke. There is a particularly American grandeur to all this. As Will Rodgers said, “America has the best politicians money can buy.” Today is the day to be proud of that uniquely American tradition. You too can grow up to buy a president.

Robert Buxbaum, April 28, 2017. I ran for water commissioner, and have written about sewage treatment, flood avoidance, and fluoride, as well as the plusses and minuses of trade unionization, and the difference between Republicans and Conservatives.

Solving the savings dilemma (how to have savings)

A few days ago, I wrote a post about the lack of savings in America, the social causes for it, and the damage it causes. I had some governmental suggestions, but suspect I didn’t emphasize that the main responsibility is personal: if you want savings, you’ve got to save.

Every rich person spends less than he earns. If you aspire to be rich, spend less on clothes than you can afford.

Every rich person spends less than he earns. If you aspire to be rich, spend less on clothes than you can afford.

If you want to have savings, it is up to you to spend less than you earn. If you don’t, you’ll never be rich, you’ll never have savings or net-economic worth, and you’ll always be strung-out over emergencies. Income and gifts won’t help if spending rises to match. At all incomes, the people who get richer are those who tailor spending to be less than earnings.

There is another personal honesty issue here, and a marriage issue too. If you spend more than you earn, someone will be cheated, and that person (your wife, husband, neighbor, friend) is likely to get mad. Earn $100 and spend $99.99, you can be honest and well liked. if you earn $1000 and spend $1000.01 and you will cheat someone you love sooner or later. Be an honest fellow and spend less. Clothes is a good place to start: say no to the fancy dress and the fancy wedding, and to fancy clothes in general. If you smoke, vaping can be a life and money saver. And try to avoid pot-smoking, at $400/oz that’s got to be a killer. And here are some water savers.

A good way to know if you are doing things right :Start a bank account, and check the balance and resolve to see it $10 higher at the end of the week than before. And that’s my two cents.

Robert Buxbaum, April 26, 2017.

Black folks have no savings (poor whites too)

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The wealth of the mean American household has dropped significantly since 2007, a result of the general de-industrialization of America. It’s not that America has gotten poorer, but in the last 8 years we’ve increased the economic divide, enriching the richest few percent while leaving behind the working and bourgeoise classes. We are beginning to come back, but a particularly nasty legacy remains, especially among black families. Some 47% of black families have no liquid savings  — a far greater fraction than in 2007. The lack of savings also appears in white families (19%), and Hispanics (41%), but it’s most desperate among blacks.

College graduation rates have increased among black students, and along with the increase there has been an increase in salaries, but savings have declined. As of 2015, 22.5% of black students and 15.5% of Hispanic students had completed four years of college. This compares to 36.2% of white students, an inequality, but not a horrible one. By 2013, the average salary of a black college grad was somewhat over $1000/week, somewhat less than the average for whites, but enviable compared to the world as whole. The problem is that black workers manage to save very little compared to other ethnic groups, and compared to previous savings rates as shown by the graphic below. By 2013, the net worth of the median black family (savings, plus paid-off part of home and car) was a mere $11,000 (Pew Research Data, below), down from $19,200 six years earlier, and much lower than the net worth of white families (also down since 2007). Liquid savings among blacks are much lower — near zero — and this is just the mean. Half of all black families are doing worse.

Net worth disparity 2007 - 2011. Black folks are doing poorly and it's getting worse.

Net worth disparity 2007 – 2011. Black folks are doing poorly and it’s getting worse.

The combination of low savings and low net worth puts black folks at a distinct disadvantage to their condition six years earlier. Without savings, it is near-impossible to weather the loss of a job, or even to fix a car or pay a ticket, Surviving through a disease is basically a one-way ticket to the welfare office. Six years ago, when people saved more and prices were lower, problems like these were major annoyances. Now, a job loss or a major repair is a family disaster.

The growth of check-cashing services in black neighborhoods is a symptom, I suspect, of the lack of liquidity. A person without savings will not have a checking account. As such, he or she will not have a credit card or check cashing privileges.  The only way to cash a check will be via a for-fee service, and these tend to come at a steep cost (2-5%). People with savings accounts can cash checks essentially for free, and can usually borrow money by way of a credit card. People without savings can’t get approved. Black people and poor whites tend to use debit cards instead. They look and work like credit cards, but they incur fees upon use, and do not provide instant loans. When black folks and poor whites need quick cash, their options are the loan-shark or the pawn shop: high-cost options that take a giant toll on the family.

As mentioned above, black individuals and families have lower incomes than whites at all education levels. While racism, no-doubt plays a role, as best I can tell, the largest single cause seems to be family stability. Employed, college-educated blacks earn, on average, 95% as much as employed, college-educated whites — not great, but not bad. The real problem with black income is that black unemployment rates are higher, black education rates are lower, and single-parent families are significantly more common among blacks than among whites and Orientals. Roughly 40% of black families are single-mother, or mother+grandparent households compared to “only” 26% in the population generally. In both populations, the number of single parent households have increased dramatically in the last few years, a result I suspect of the government’s desire to help. The government gives more aid to a split-up couple than to one that stays together, but the aid brings with it long-term damage to net worth. A family with one parent will naturally have a lower-income and savings rate than a family with two. The lack of stability and savings that comes from having a single parent family, I suspect, has contributed to crime, births out-of-wedlock, and the tendency of blacks to drop out of college.

Black families don't benefit as much from college --in part a result of the choice of courses.

Black families don’t benefit much from college –in part a result of course choices, in part the result of borrowing. (Forbes, 2015).

One finds that do-gooders in the white communities want to eliminate check cashing businesses and pawn shops in a misguided desire to help the low-income neighborhoods, but the success of these companies tell me that they are needed. Though check services and pawn brokers take a nasty bite, urban life would be much worse without them, I suspect.

Another so-called solution of the do-gooders, is to tax savings and transfer the wealth to the poor. This form of wealth redistribution has been a cornerstone of the Democratic party for the last century. The idea of the tax is that it will transfer “idle wealth” from rich savers to poor folks who will spend it immediately. The problem is that great swathes of the nation don’t save at all currently; net worth is down all across the US — among white and black families both. Taxing savings will almost-certainly reduce the savings rate even further. Besides, savings are the stuff of self-determination and dreams — far more than spending, it is savings that allows a person to start a new business. One does not provide for the dreams of one group by taking them from another — particularly another group chosen to be immediate spenders. That is a route to community disaster, is seen by looking at Detroit.

As it is, many poor, inner city children do not see a path out via education. Detroit school attendance hovers around 50%, and business startups are lacking. As best inner city people can tell, the only ways out are sports, music, prostitution, crime, and the church. With higher savings rates and higher family stability, folks could start businesses, and/or take advantage of job opportunities that come along. People seem to think that wealth redistribution should help, but it just seems to reduce savings and family stability. Every effort to increase wealth redistribution only seems to make things worse in Detroit.  It sometimes seems that the only businesses in Detroit are check cashing, pawn brokers, churches, hair-salons, fast food, and medical marijuana — businesses that require little investment, but provide little community return too. Detroit has lost its manufacturing center, and now has more medical marijuana providers than groceries — a sad state of affairs.

The Check cashing services of south-eastern MI are concentrated in poor black and white neighborhoods.

The Check cashing services of south-eastern MI are concentrated in poor black and white neighborhoods.

In 2016, both presidential candidates touted major infrastructure projects, highways and the like, to help the inner city poor. In principle this can help, but I have my doubts. One basis of doubt: inner city youth do not have the training to build roads and bridges — they have barely the training to work at McDonald’s. For another thing, if the project itself isn’t needed, it becomes another form of income redistribution. There tends to be a lack of pride in doing it well, and the benefits are basically nothing. A major war could provide jobs, of course, but most sane people prefer peace. Trump has made the case for tariffs (closing off free trade) as a way to rebuild the industrial center of cities like Detroit. It’s an approach that I think has merit. He’s also suggested closing the border to low-wage, Mexican workers, and recently signed a bill that raised the minimum wage for foreign workers. This is expected to raise the price of California lettuce and NY hotel stays, but is likely to increase employment among low-skill Americans — blacks and poor whites. Small steps, I think, to solving a serious national problem.

Robert E. Buxbaum, April 21, 2017. I ran for water commissioner 2016 (Republican). I lost. I also have some infrastructure suggestions, including daylighting some rivers and adding weirs to improve water quality and stop flooding. If you like my ideas (or don’t) please provide comments.

pee in the shower and other water savers

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Do you want to save the planet and save money at the same time? Here are some simple tips:

The first money and planet saver, is to pee in the shower. For those who don’t have a lawn, or who don’t water, your single biggest water cost is likely the toilet. Each person in your household will use it several times per day, at roughly 1.6 gallons per flush. In Oak Park, Michigan the cost of water is 1.5¢/gallon, so each flush costs you, roughly 2.5¢. If you pee in the shower every morning, you’ll save yourself about one flush per day, or 2.5¢. Over the course of a year you’ll have used about 500 gallons less, and will have saved yourself somewhere between $5 and $10. Feel good about yourself every morning; the effort involved is truly minimal.

Related to peeing in the shower, I should mention that many toilets leak. A significant part of your water bill can often be cut by replacing the “flapper valve on the inside of your toilet tank, and/or by cleaning the needle fill valve. To see if you need this sort of help, put a few drops of food dye in the toilet when you leave in the morning. If the color is largely gone by the time you get back, the toilet is leaking the equivalent of a few volumes per day, that is at least as much water as is flushed. If the color goes faster, or you hear the tank refill when no one used it, you’re leaking more. Check the flapper and replace it if it’s worn — it’ll cost about $3 — and check the needle-fill valve. They don’t work forever. Cleanliness is near godliness.

Mulch is good, this is too much concentrated by the tree trunk. Use only 2 inches and spread it out to save water and weeding.

Mulch is good, this is too much concentrated by the tree trunk. Use only 2-3 inches and spread it out from the trunk to save water and weeding without attracting bugs.

If your valve is leaking and you decide to replace it, you may want to replace with a variable flush valve. Typically, there are two options: a big vale for big flush (1.6 gal) and a small valve for small flush (1 gal or less). These are widely used in Europe. You can make up for this cost rather quickly at 1.5¢/gallon.

The next big issue is lawn-care. If you water your lawn and flowers daily, you’ve likely noticed that you pay about $300/month for water in the summer: a lot more than in the winter, or than your lazes-faire neighbor in the summer. Every $150 of summer-excess, water bill you pay represents about 10,000 gallons applied to your lawn. That’s a cubic foot, or 1¢ to 2¢ of water applied per ft2 per month for typical watering. While many sites advise that you can save by adding a rain barrel, I disagree. Rain barrels are costly, ugly, and are a lot of work ago plumb in. And each barrel only holds 55 gallons of water, 82¢ worth when full. You do a lot better, IMHO by putting down an inch or two of mulch around your flowers and vegetables. This mulch requires no work and will keep you from needing to water these areas for the 3-4 days after every rainfall. A layer of 1″ to 2″ will help your soil hold 0.5 to 1 gallon of water per square foot. At typical prices of mulch and water, this will pay for itself in 1-2 years and will help you avoid weeding. Mulch is a far better return than the rain-barrels that are often touted, and there’s far less effort involved. Buy the mulch, not the barrel, but don’t put down too more than 2″ on flowers and vegetable. Trees can take 3 -4″; don’t use more. Avoid a mulch mountain right next to a tree, it causes the roots to grow weird, and provides a home for bugs and undesirable anaerobic molds.

A little more work than the above is to add a complete rain garden or bioswale. Build it at the bottom of any large incline on your property, where the water runs off (It’s likely a soggy swamp already). Dig the area deeper and put, at the bottom of the hole, a several-inch layer of mulch and gravel. Top it off with the soil you just removed, ideally raising the top high enough that, if the rain garden should fill, the water will run off to the street. Plant in the soil at the top long-rooted grasses, or flowers, vegetables, or water-tolerant trees. You may want to direct the water from your home’s sump pump here too (It can help to put a porous pipe at the bottom to distribute this water). If you do this right, you’ll get vegetables or trees and you won’t have to water the garden, ever. Also, you’ll add value to your property by removing the swampy eyesore. You’ll protect your home too, since a major part of home flooding comes from the water surge of sump water to the sanitary sewer.

Robert E. Buxbaum, April 14, 2017. I ran for water commissioner, Oakland County, MI, Nov. 2016. Among my other thoughts: increased retention to avoid flooding, daylighting rivers, and separating the sanitary from the storm sewers. As things stand, the best way to save money on water– get the same deal the state gave to Nestle/ Absopure: they pay only $200/year to pump 200 gal/minute. That is, they pay only 1/3000 of what you and I pay. It helps to have friends in government.

Taxes and accounting jokes

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A friend called the other day asking about a financial matter. It seems his wife bought some pictures for  pictures a few days ago for $2000, and after having them apprised, she finds they’re worth $2,000,000.

I started talking about un-realized profits, and mentioned that I never imagined that his wife had such an eye for art. He said, they’re not art pictures, exactly; they’re of you discussing business with the Russians. (It’s a joke — I thought you-all might depreciate it).

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When I started my business, I found that you could deduct medical costs. I called the IRS and asked if I could deduct birth control. They told me: “only if it doesn’t work.”

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I’m glad I learned about parallelograms in school, instead something mundane, like taxes. It’s really come in handy this parallelogram season.

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I got a robo-call asking me to press “1” to hear about a government program for those who wanted to avoid paying back taxes. I did, and a voice said “Leavenworth.”   It wasn’t much of a program, more of a sentence.

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Robert E. Buxbaum, April 5, 2017.  For jokes on other topics, click the jokes tag, here.

The argument for free trade is half sound

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In 1900, the average tariff on imported goods was 27.4% and there was no income tax. Import tariffs provided all the money to run the US government and there was no minimum wage law. The high tariffs kept wage rates from falling to match those in the 3rd world. Currently, the average tariff is near-zero: 1.3%. There is a sizable income tax and a government income deficit; minimum wage laws are used to prop up salaries. Most economists claim we are doing things right now, and that the protective tariffs of the past were a mistake. Donald Trump claimed otherwise in his 2016 campaign. Academic economists are appalled, and generally claim he’s a fool, or worse. The argument they use to support low tariffs was made originally by Adam Smith (1776): “It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy…. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry.” As a family benefits from low cost products, a country must too. How stupid would you have to be to think otherwise?

A cartoon from Puck 1911. Do you cut tariffs, and if so how much. High tariffs provide high wages and expensive prices for the consumer. Low tariffs lead to cheap products and low wages. Uncle Sam is confused.

A cartoon from Puck, 1911. Should tariffs be cut, and if so, how much. High tariffs provide high prices and high wages. Low tariffs lead to low prices for the consumer, but low wages. Uncle Sam is confused.

Of course, a country is not a family, and there are certain benefits in keeping manufacturing and employment here, in not exporting jobs and expertise. It is clear that some people benefit from a flood of cheap, imported products, while some folks suffer. Consumers and importers benefit, while employees generally do not. They are displaced from work, or find they must compete with employees in very low wage countries, and often with child labor or slave labor. The cartoon at right shows the conundrum. Uncle Sam holds a knife labeled “Tariff Revision” trying to decide where to cut. Any cut that helps consumers hurts producers just as much. Despite the cartoon, it seems to me there is likely an optimal, non-zero tariff rate that allows productive trade, but also provides revenue and protects American jobs.

A job-protecting tariff was part of the Republican platform from Lincoln’s time, well into the 20th century, and part of the Whig platform before that. Democrats, especially in the south, preferred low tariffs, certainly no more than needed to provide money for government operation. That led to a diminution of US tariffs, beginning in the mid- 1800s, first for US trade with developed countries, and eventually with third world as well. By the 1930s, we got almost no government income from tariffs, and almost all from an ever-larger income tax. After WWII low tariff reductions became a way to promote world stability too: our way of helping the poor abroad get on their feet again. In the 2016 campaign, candidate Donald Trump challenged this motivation and the whole low-tariff approach as anti- American (amor anti America-first). He threatened to put a 35% tariff on cars imported from Mexico as a way to keep jobs here, and likely to pay for the wall he claimed he would build as president. Blue-collar workers loved this threat, whether they believed it or not, and they voted Republican to an extent not seen in decades. Educated, white collar folks were uniformly appalled at Trump’s America-first insensitivity, and perhaps (likely) by the thought that they might have to pay more for imported goods. As president, Trump re-adjusted his threat to 20%, an interesting choice, and (I suspect) a good one.

The effect of a 20% tariff can be seen better, I think, by considering a barter-economy between two countries, one developed, one not: Mexico and the US, say with an without a 20% tax. Assume these two countries trade only in suits and food. In the poor country, the average worker can make either 4 suits per month or 200 lbs of food. In the developed country, workers produce either 10 suits or 1000 lbs of food. Because it’s a barter economy with a difference in production, we expect that, in the poor country, a suit costs 50 lbs of food; in the rich country, 100 lbs of food. There is room here to profit by trade.

The current state of tariffs world-wide. Quite a few countries have tariffs much higher than ours. Among those, Mexico.

Tariffs world-wide. We put no tax on most imported products while much of the world taxes our products heavily.

With no tariff, totally free trade, an importer will find he can make a profit bringing 100 lbs of US food to Mexico to trade for 2 suits. He can return two suits to the US having gotten his two suits at the price of one, less the cost of transport, lawyers, and middlemen (relatively low). Some US suit-makers will suffer, but the importer benefits immediately, and eventually US consumers and Mexican suit workers will benefit too. Eventually, US suit prices will go down, and Mexican wages up, We will have cheaper suits and will shift production to what we make best —  food.

In time, we can expect that an American suit maker will move his entire production to Mexico bringing better equipment and better management. Under his hand, lets assume his Mexican workers make 6 suits per month. The boss can now pay them better, perhaps 100 lbs of food and two suits per month. He still makes a nice profit, more than before: he ships two suits to the US to buy the 200 lbs of food, and retains now two suits as profit. Hillary Clinton believed this process was irreversible. “Those jobs are gone and they’re not coming back,” her campaign told CNN. She claimed she’d train the jobless “for the jobs of the future” and redistribute the wealth of the rich, a standard plank of the democratic platform since 1896. But, for several reasons, industrial voters didn’t trust her to succeed, or even to try. Redistribution of wealth rarely works because, even if a politician has the will, and most don’t, manufacturers can usually keep their profits off-shore, and they do.

A very high tariff would stop all trade, but lets see what would happen with Trump’s 20% tariff. With a 20% tariff, when the first two suits come to the US, we’d extract 0.4 suits in tax revenue. The importer still makes a profit, but it’s now 0.6 suits, the equivalent of 60 lbs of food. He can sell suits for less than the American, but not as much less. If the manufacturer moves to Mexico he makes more money, but not quite as much. Tax is still collected on every suit brought to America — now 20% of the 3 suits per Mexican worker that the Boss must export. The American worker’s wages are depressed but he/she isn’t forced to compete with the Mexican dollar-for-dollar (suit for suit). In barter terms, he isn’t required to make 6 suits for every 100 lbs of food.lincoln-national-bank-internal-improvements-tariffs

We find that, in the above fictional economy, a 50% tariff in the maximum to allow any profitable suit trade: the first two suits might enter the US; but they’d be taxed at one suit, just enough to pay for the 100 lbs of food that he’d have to barter for the 2 suits. At that rate, there would be no profit for the importer, and he/she would stop importing. A 50% tariff is thus counter-productive to the consumer and the US gov’t: we would get no imported goods, and we’d collect no import revenue – a bad situation in general, though good for the manufacturer. Lincoln’s “protective tariffs” of 1861 contributed to Southern succession and the start of the civil war. It seems to me that some modest tariff of 10% to 20% is fair and productive — tariff rates that Trump seems to have intuited, and that many other countries have adopted, see map-chart above. As for the academic economists, I note that they also predicted a stock market crash should Trump be elected; it’s gone nearly straight up since November 8, 2016. I find that most economists are not rich despite claiming to be experts on money.

Robert E. Buxbaum, March 27, 2017. I learned such economics as I have from my one course in economics, plus comic books like the classic “Once upon a dime” produced by the New York Federal Reserve. Among the lessons learned: that money is a distraction, just a more convenient way to carry around a suit, 100 lbs of food, or a month of work. If you want to understand economics, I think it helps to work things out in terms of barter, as above.

Global warming and the president’s Resolute desk

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In the summer of 2016, the Crystal Serenity, a cruse ship passed through the Northwest passage, going from the Pacific to the Atlantic above the Canadian arctic circle. It was a first for a cruise ship, but the first time any modern ship made the passage, it was 162 years ago, and the ship was wooden and unmanned. It was the British Resolute; wood from that ship was used to make the President’s main desk — one used by the last four presidents. And thereby hangs a tale of good global warming, IMHO.

President Trump meets with college presidents at the Resolute desk. Originally the front had portraits of Queen Victoria and President Hayes. Those are gone; the eagle on the front is an addition, as is the bottom stand.

President Trump meets with college presidents at the Resolute desk. Originally the front had portraits of Queen Victoria and President Hayes. Those are gone; the eagle on the front is an addition, as is the bottom stand. The desk is now 2″ taller than originally. 

The world today is warmer than it was in 1900. But, what is not generally appreciated is that, in 1900 the world was warmer than In 1800; that in 1800 it was warmer than in 1700; and that, in 1640, it was so cold there were regular fairs on the frozen river Themes. By the 1840s there were enough reports of global warming that folks in England thought the northwest passage might have opened at last. In 1845 the British sent two ships, the Erebus and the Terror into the Canadian Arctic looking for the passage. They didn’t make it. They and their crews were lost and not seen again until 2014. In hopes of finding them though, the US and Britain sent other ships, including the Resolute under the command of captain Edward Belcher.

The Resolute was specially made to withstand the pressure of ice. Like the previous ships, and the modern cruise ship, it entered the passage from the Pacific during the peak summer thaw. Like the ships before, the Resolute and a partner ship got stuck in the ice — ice that was not quite stationary, but nearly so, The ships continued to move with the ice, but at an unbearably slow pace. After a year and a half captain Belcher had moved a few hundred miles, but had had enough. He abandoned his ships and walked out of Canada to face courts martial in England (English captains were supposed to “go down with the ship”). Belcher was acquitted; the ice continued to move, and the ships moved with it. One ship sank, but the Resolute, apparently unscathed, passed through to the Atlantic. Without captain or crew, she was the first ship in recorded history to make the passage, something that would not happen again till the Nautilus nuclear submarine did it under the ice, 100 years later.

 

The ghost ship Resolute was found in September 1855, five years after she set sail, by captain Buddington of the American whaler, George Henry. She was floating, unmanned, 1200 miles from where captain Belcher had left her. And according to the law of the sea, she belonged to Buddington and his crew to use as they saw fit. But the US was inching to war with Britain, an outgrowth of the Crimean war and seized Russo-American property. Franklin Pierce thought it would help to return the ship as a sign of friendship — to break the ice, as it were. A proposal for funds was presented to congress and passed; the ship was bought, towed to the Brooklyn Navy yard for refitting, and returned to Britain as a gift. The gift may have worked: war with Britain was averted, and the seized property was returned. Then again, Britain went on to supply the confederacy early in the Civil War. None-the-less, it was a notable ship, and a notable gift, and when it was broken up, Parliament decided to have two “friendship desks” made of its timbers. One desk was presented to President Hayes, the other to Queen Victoria. One of these desks sits the British Naval museum at Portsmouth; its American cousin serves Donald Trump in the Oval office as it has served many president before him. It has been used by Coolidge, Kennedy, Carter, Reagan, Clinton, Bush II, and Obama before him — a reminder that global warming can be good, in both senses. If you are interested in the other presidents’ desks, I wrote a review of them here.

As for the reason for the global warming of the mid 1800s, It seems that climate is chaotic. ON a related note, I have proposed that we make a more-permanent northwest passage by cutting thorough one of the islands in northern Canada. If you want to travel the Northwest passage in 2017, there is another cruise scheduled, but passage is sold out.

Robert Buxbaum, March 16, 2017.

Arrested for decriminalized possession

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The arrest rate for marijuana is hardly down despite widespread decriminalization, but use is up. decriminalization, but use is up. A rate that exceeds that for all violent crime.

Despite years of marijuana decriminalization, arrest rates for marijuana are up from 20-25 years ago, and hardly down from last year. Why?

There are a couple of troubling patterns in US drug arrests. For one, though marijuana has been decriminalized in much of the USA, marijuana arrest rates are hardly down from five years ago, and higher than 20-30 years ago — see graph at right. Besides that, it’s still mostly black-people and Latinos arrested. And the crime is, 4/5 the of the time, drug possession, not sale.

At the same time that violent crime rates are falling, marijuana possession arrests are rising (see graph below). Currently, according to FBI statistics,  more people are arrested for marijuana possession than for all violent crime combined. You’d expect it would not be this way, and a question I’d like to explore is why. But first, let’s look at more data. I note that part of an explanation is that marijuana use is up (18% in 2015 vs 12% in 1990). This still doesn’t explain the racial imbalance but it could explain the general rise. Marijuana isn’t quite legal, and if use is up, you’d expect arrests to be up. But even here, something is fishy: use rates are the same as in 1980, 35+ years ago in the midst of the “war on drugs,” but arrest rates have more than doubled since. Why? Take New York City as an example, 17,762 people were arrested for low-level marijuana possession in 2016 (smoking in public or possession of 25 gm to 2 oz). The low-level arrest rate is twice the national average in this Democratic-bastion city, where the drug was decriminalized years ago. Arrest rates in NYC went up an additional 10% in 2016, with black people arrested at 11 times the rate of white people. How could this be?

The race discrepancy of arrests persists across the US. Though black citizens use drugs only 15% or so more often than whites, and make up only 13% of the US population, they are arrested for drugs about three times as often and incarcerated about 4 times as often. It’s mostly for marijuana possession too, and the discrepancy varies very strongly by location In Louisiana, Illinois, and New York City arrests are particularly weighted to people of color. When New York City police precinct captains were asked about this, they explained that their instructions come from above. It’s a curious answer, I’d say, reflecting perhaps their dislike of the mayor.

Drug arrests are mostly for possession, not sale, and the spread is rising.

Drug arrests are mostly for possession, not sale and the spread is rising. More than half the time, it’s marijuana.

One of the race-affecting instructions is that the police are instructed to patrol black neighborhoods, but not the student unions of majority-white colleges like NYU. They’re mandated to stop and search junky cars but not nice ones, and to search people who have outstanding parking tickets, but not generally. They even get raises that depend on the number of tickets given, a practice that does not lead to a pattern of looking the other way — one many New Yorkers would prefer. Another issue: in many states, including New York, the police can keep money or cars, if they can claim that the asset was purchased with drug money or used in the drug trade. This leads to a practice where the city budget benefits when the police arrest persons they don’t expect will be convicted. It’s a practice called civil asset forfeiture, one lampooned, on Last Week Tonight, but jealously guarded. Since it is near impossible to prove that the money or car was not used in any way illegally, once they arrest someone, the police can expect to keep his or her money or cars indefinitely. The annoyance of lawyers perhaps encourages the arrest of people who do not seem to have them — people of color. New York mayor deBlassio justifies his arrests as a way to protect the neighborhoods, as his version of former mayor, Guilliani’s broken window approach. Maybe. But I think the profit motive is at least as relevant.

drug arrests hit black folks a lot more than white

Drug arrests hit black folks a lot more than white.

I note that strict justice tends to land hardest on the poor and defenseless. I also note that many important people have used marijuana without it damaging their lives in any obvious way. Both Jeb! Bush and Bill Clinton claimed to have smoked it; as did Barak Obama, Al Gore, and the Beatles. My bottom line: while marijuana decriminalization is worthwhile, it must go along with the repeal of civil asset forfeiture laws, and other means that make arrests into profit centers – or so it appears to me. Otherwise we’ll keep on flushing lives down the drain for no good reason.

Robert Buxbaum, March 6, 2017. I’ve previously blogged about the structure of criminal sentencing, coming to conclude that the least strict sentence that does the job is to be preferred. I also ran for water commissioner in 2016.

The hydrogen jerrycan

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Here’s a simple invention, one I’ve worked on off-and-on for years, but never quite built. I plan to work on it more this summer, and may finally build a prototype: it’s a hydrogen Jerry can. The need to me is terrifically obvious, but the product does not exist yet.

To get a view of the need, imagine that it’s 5-10 years in the future and you own a hydrogen, fuel cell car. You’ve run out of gas on a road somewhere, per haps a mile or two from the nearest filling station, perhaps more. You make a call to the AAA road-side service and they show up with enough hydrogen to get you to the next filling station. Tell me, how much hydrogen did they bring? 1 kg, 2 kg, 5 kg? What did the container look like? Is there one like it in your garage?

The original, German "Jerry" can. It was designed at the beginning of WWII to help the Germans to overrun Europe.

The original, German “Jerry” can. It was designed at the beginning of WWII to help the Germans to overrun Europe. I imagine the hydrogen version will be red and roughly these dimensions, though not quite this shape.

I figure that, in 5-10 years these hydrogen containers will be so common that everyone with a fuel cell car will have one, somewhere. I’m pretty confident too that hydrogen cars are coming soon. Hydrogen is not a total replacement for gasoline, but hydrogen energy provides big advantages in combination with batteries. It really adds to automotive range at minimal cost. Perhaps, of course this is wishful thinking as my company makes hydrogen generators. Still it seems worthwhile to design this important component of the hydrogen economy.

I have a mental picture of what the hydrogen delivery container might look like based on the “Jerry can” that the Germans (Jerrys) developed to hold gasoline –part of their planning for WWII. The story of our reverse engineering of it is worth reading. While the original can was green for camouflage, modern versions are red to indicate flammable, and I imagine the hydrogen Jerry will be red too. It must be reasonably cheap, but not too cheap, as safety will be a key issue. A can that costs $100 or so does not seem excessive. I imagine the hydrogen Jerry can will be roughly rectangular like the original so it doesn’t roll about in the trunk of a car, and so you can stack a few in your garage, or carry them conveniently. Some folks will want to carry an extra supply if they go on a long camping trip. As high-pressure tanks are cylindrical, I imagine the hydrogen-jerry to be composed of two cylinders, 6 1/2″ in diameter about. To make the rectangular shape, I imagine the cylinders attached like the double pack of a scuba diver. To match the dimensions of the original, the cylinders will be 14″ to 20″ tall.

I imagine that the hydrogen Jerry can will have at least two spouts. One spout so it can be filled from a standard hydrogen dispenser, and one so it can be used to fill your car. I suspect there may be an over-pressure relief port as well, for safety. The can can’t be too heavy, no more than 33 lbs, 15 kg when full so one person can handle it. To keep the cost and weight down, I imagine the product will be made of marangeing steel wrapped in kevlar or carbon fiber. A 20 kg container made of these materials will hold 1.5 to 2 kg of hydrogen, the equivalent of 2 gallons of gasoline.

I imagine that the can will have at least one handle, likely two. The original can had three handles, but this seems excessive to me. The connection tube between two short cylinders could be designed to serve as one of the handles. For safety, the Jerrycan should have a secure over-seal on both of the fill-ports, ideally with a safety pin latch minimize trouble in a crash. All the parts, including the over- seal and pin, should be attached to the can so that they are not easily lost. Do you agree? What else, if anything, do you imagine?

Robert Buxbaum, February 26, 2017. My company, REB Research, makes hydrogen generators and purifiers.

A very clever hydrogen pump

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I’d like to describe a most clever hydrogen pump. I didn’t invent it, but it’s awfully cool. I did try to buy one from “H2 Pump,” a company that is now defunct, and I tried to make one. Perhaps I’ll try again. Here is a diagram.

Electrolytic membrane H2 pump

Electrolytic membrane H2 pump

This pump works as the reverse of of a PEM fuel cell. Hydrogen gas is on both sides of a platinum-coated, proton-conducting membrane — a fuel cell membrane. As in a PEM fuel cell, the platinum splits the hydrogen molecules into H atoms. An electrode removes electrons to form H+ ions on one side of the membrane; the electrons are on the other side of the membrane (the membrane itself is chosen to not conduct electricity). The difference from the fuel cell is that, for the pump you apply a energy (voltage) to drive hydrogen across the membrane, to a higher pressure side; in a fuel cell, the hydrogen goes on its own to form water, and you extract electric energy.

As shown, the design is amazingly simple and efficient. There are no moving parts except for the hydrogen itself. Not only do you pump hydrogen, but you can purify it as well, as most impurities (nitrogen, CO2) will not go through the membrane. Water does permeate the membrane, but for many applications, this isn’t a major impurity. The amount of hydrogen transferred per plate, per Amp-second of current is given by Faraday’s law, an equation that also shows up in my discussion of electrolysis, and of electroplating,

C= zFn.

Here, C is the current in Amp-seconds, z is the number or electrons transferred per molecule, in this case 2, F is Faraday’s constant, 96,800, n is the number of mols transferred.  If only one plate is used, you need 96,800 Amp-seconds per gram of hydrogen, 53.8 Amp hours per mol. Most membranes can operate at well at 1.5 Amp per cm2, suggesting that a 1.1 square-foot membrane (1000 cm2) will move about 1 mol per minute, 22.4 slpm. To reduce the current requirement, though not the membrane area requirement, one typically stacks the membranes. A 100 membrane stack would take 16.1 Amps to pump 22.4 slpm — a very manageable current.

The amount of energy needed per mol is related to the pressure difference via the difference in Gibbs energy, ∆G, at the relevant temperature.

Energy needed per mol is, ideally = ∆G = RT ln Pu/Pd.

where R is the gas constant, 8.34 Joules per mol, T is the absolute temperature, Kelvins (298 for a room temperature process), ln is the natural log, and Pu/Pd is the ratio of the upstream and downstream pressure. We find that, to compress 2 grams of hydrogen (one mol or 22.4 liters) to 100 atm (1500 psi) from 1 atm you need only 11400 Watt seconds of energy (8.34 x 298 x 4.61= 11,400). This is .00317 kW-hrs. This energy costs only 0.03¢ at current electric prices, by far the cheapest power requirement to pump this much hydrogen that I know of. The pump is surprisingly compact and simple, and you get purification of the hydrogen too. What could possibly go wrong? How could the H2 pump company fail?

One thing that I noticed went wrong when I tried building one of these was leakage at the seals. I found it uncommonly hard to make seals that held even 20 psi. I was using 4″ x 4″ membranes so 20 psi was the equivalent of 320 pounds of force. If I were to get 200 psi, there would have been 3200 lbs of force. I could never get the seals to stay put at anything more than 20 psi.

Another problem was the membranes themselves. The membranes I bought were not very strong. I used a wire-mesh backing, and a layer of steel behind that. I figured I could reach maybe 200 psi with this design, but didn’t get there. These low pressures limit the range of pump applications. For many applications,  you’d want 150-200 psi. Still, it’s an awfully cool pump,

Robert E. Buxbaum, February 17, 2017. My company, REB Research, makes hydrogen generators and purifiers. I’ve previously pointed out that hydrogen fuel cell cars have some dramatic advantages over pure battery cars.