Saturday, January 25, 2020

Studio C, Flecks of Gold and Tomlinson

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My parents were in town and like most people who come to my home they were tortured with a mix of home videos and my kids favorite Studio C skits. We watched The Devil's Dilemma and at the end of the skit my Dad said, "That is basically Tomlinson by Rudyard Kipling."

We read it, (after he quoted a bit for us). It is a great poem and a great skit and I highly recommend both. And he was right. I don't know if Studio C got the idea from the poem, but they are the same idea. I have always been amazed by my Father's wealth of literary knowledge. As I thought how amazing it would be to have his database of literary works at my finger tips, I was reminded of one of my favorite parables.

There was a young merchant who came to California to make his wealth panning for gold. He quickly grew frustrated with his lack of success. One day he yelled in frustration, "There is no gold here."

An old prospector who happened to be walking by responded, "There is gold all right." He took up a rock, cracked it in half revealing a few small flecks of gold. 

"I am not looking for tiny flecks, I am looking for nuggets like you have in your pack." 

The prospector opened his bag to reveal thousands of small flecks of gold. "Son, the patient accumulation of these little flecks has brought me great wealth."

My Father has patiently collected little flecks of knowledge through great literature. And while many like myself jealously look at the accumulation of wealth of knowledge, we all have access to all he as, much more, and much easier today. Yet, many of us, including myself, spend much of our time reading or listening to talking heads pontificate about how our favorite quarterback will perform, or how a political raise that is 8 months away may or may not turn out, or what memes our 'friends' have posted. By so doing we pass up time when we could be gathering flecks of gold, knowledge from studying great works or literature, or reading about the lives of great men and women. And maybe more importantly actually doing something to become great men and women, just ask Tomlinson.

Sunday, January 5, 2020

Those Over Specialized Chickens

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Sometimes I feel like this is how the eggs out my chicken should look given how much they cost me

This is a follow up to my Miracle of Pineapple post so if you haven't read it, I suggest that one first.

Given it’s pitfalls it is easy to pick holes in capitalism, and perhaps someday I will write an essay on it, but today I wish to tackle the dangers of over specialization. As stated in my earlier post a lot of credit has to go to specialization. Without a man being a great crane operator and one who knew exactly how to run the plant, and scientists who spend their lives trying to improve crop yields on pineapples there is no way it would come to me for $0.99. This system maximizes economic output, and it does it well, but what it does not maximize or have any incentive to do so is Human Development.

This lesson came home to me recently as I have had the exceptional joy of raising chickens. I love my little flock. Every morning I or one of the kids goes out and opens the barn and my ducks and chickens run out to get their fill of chick feed I got from the local hardware store. Before I had chickens I had a few neighbors who had chickens. One day they offered to sell me some eggs. I said sure, how much? $5 a dozen. I nearly choked. There are on sale down at my local grocery store for $1.99, I thought I was going to get an inside deal. They explained something about organic, happy chickens laying better tasting eggs. Could happy chickens really be worth and extra $3 a dozen?

So, when I got chickens I decided to do a little analysis on what it costs me to farm for eggs. I had to pay a few bucks for each bird, some died, then I had to raise them for 16 months before they laid any eggs. My flock is the size such that I pay about $80 a month on feed. Admittingly, I think the doves run off with about as much as my chickens do. Also, Coyotes have made off with some of my birds from time to time. That led to at least $500+ in fence costs (not that it help, I'll make this a link to explain at a later date). I bought feeders and medicine from time to time. And I live in Southern Nevada, so during high heat they slow down laying eggs. I also don’t use artificial light so they slow down in the winter. Then once and a while one gets broody and my wife, thinks of a chicken wanting to be a Mother and she gives in and lets it hatch a few chicks. Needless to say, when it came time to sell our excess eggs I charge $5 a dozen, and am still losing money.

I was whining about this to one of my friends, wondering if I had lost my sanity, because Dr. Ballif who had taught me engineering economics would wonder if I had learned anything in that class. He said, “but you’re not raising chickens, you’re raising children.” And he is absolutely correct. My monthly egg budget has gone from $6 a month, to over $100 a month, but that’s not why I do it. I love the chickens some, but not that much. It’s for the kids. I think them getting up, feeding the chickens, teaches them regular importance of work. Seeing that if we forget to put them away, they can literally die from coyotes, teaches that there are consequences for our actions. They begin to understand where their food and meat comes from. They and I have had many lessons on mortality that are becoming more and more rare in our society.

I am reminded of what my mission president always told me, that the best missionaries came from farms. Why? Because they knew how to work. I want my kids to know how to work.

So, back to my point. Specialization. It has done some amazing things for us, given us great economic output. It has made it so I can spend my whole career focused on Dam Safety Engineering, or being a construction defect lawyer or an auto mechanic who only works on Fords. And I will be paid very well to do that. In fact, often the more we specialize the more money we make. A general practitioner will make a lot of money, but become a specialist in oncology, or radiology and make much more.

So, I have enough money to focus on my area and pay someone to work on my car. When I have a plumbing issue I can pay a specialist to fix it. If I want a fence put in my yard I can get a guy with all the right equipment to go out and put it in for me. I understand this might maximize economic output. After all, he could fix the leak in an hour and it will take me all day Saturday. (Time that I would of course productively spend catching up on Netflix.) But is that what is really best for my development as a human. Were we better off when the average person knew how to change a carburetor, fix a leaky faucet, and turn wheat into a loaf of bread?

If you think this is an anti-capitalist post you are incorrect. Capitalism and free markets do their job well, but they don't do everything. This is simply saying that while we live in a capitalistic and fairly free market society that incentives us to maximize economic output, perhaps we need to think a little bit more about our own development from time to time. This is easy to see with our kids, it’s always easier to do their jobs for them, but you know they need to learn. The same might be true for each of us. Once and a while we need to still make something from scratch. Have a little garden, even if all it leads to is the world's most expensive salad. Go ahead and fix the sink, even though you will have to call the plumber and it will cost two times as much because he has to correct all the mistakes you made. Or raise your own eggs and meat even though it will be the most expensive, time intensive food you will ever consume. We need to use some of the time and money that this wonderful economic system has given not just to pursue our unique profession or entertain ourselves but rather do many of the things our forefathers had to do, so we can not only develop our economy but also ourselves.

Saturday, January 4, 2020

Miracle of Pineapple

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Today I am writing about the joys and sorrows associated with specialization. I want to start with speaking of the joys. To do so I want to write about the miracle of the pineapple. I have to admit that I stole this from "I, pencil", an essay by Leonard E. Read, but I like pineapples more than pencils, so mine is better. (Okay his is better and you should read it if you haven't, but please read mine too.)

Pineapples only grow in tropical climates. Because most of us have spent our lives outside tropical climates we may have never seen a pineapple plant. But for those desert dwellers like myself, they look much like a Yucca plant. From the time a new pineapple plant is planted in the ground it will take two years of watering, providing proper nutrition and other care for it to get one pineapple. It only grows one pineapple at a time. Then the next year the pineapple plant will get a second pineapple, and if you are lucky you will get one the next year. Then the plant will die. Plantations usually clear the field after the second harvest because it takes too much work for the third harvest when only some will get that third pineapple. So, it takes one plant three years to get you two pineapples.

The plants are rough and ask anyone who has ever spent any time harvesting the plants just how hard this can be. It has been known to be so hard on workers that they often lose their fingerprints from constant removal of skin in that area (not sure why they don’t use gloves). Whenever I speak of the miracle of the pineapple anywhere within a mile of my Uncle Preston he is quick to remind me that many pineapples are often harvested by teenagers who get swindled into a summer of labor so they can get a free trip to Hawaii. But I have no doubt that the back breaking labor well prepared him to be the great business man he is today, so he can’t complain too much.

Once the pineapple is harvested it is shipped to a processing plant. There it is cut and sliced. The juices are saved and then the pineapple is canned in a tin can with its juices and stacked and shipped. The shipping is no small feat. Most pineapples are grown on the islands, so after they are canned they are stacked, wrapped and loaded onto a truck and taken to a port. Then they are unloaded, and reloaded on an ocean liner. From there they again arrive and port and do the same thing in reverse order, from ship back to truck. And then once loaded on a truck they are sent out to a grocery store, where they are again unloaded, unwrapped and taken out by your local grocery stocker. Then you show up and by it for 99 cents.

As a side note fresh pineapple is only possible in the states because of air transport or refrigerated transport. Most comes over by air.

Everytime I bite into a pineapple fresh or canned, I can’t help but think what a miracle it is that I get to be enjoying, what I feel is, one of the most exquisite taste on this planet. Think for a moment how many people were involved to get that to you. There was a farmer/land owner, likely farm hands in planting, nurturing and caring for the plant. There was time, two years while it was grown. Then someone had to harvest, drive to the packing plant. The plant is full of operators, managers, and logistics personnel. The machines that are made specifically to chop and save the juices had to be designed, manufactured and maintained. The plant needs clean water to run, that has to be treated and pumped to the plant and there has to be infrastructure to take away the waste and garbage. They are put into tin cans, a metal that had to be mined shaped and go through it’s whole process. Then you need someone to pack the truck (did I mention there is another whole factory somewhere building the packing material that has it’s own story), trucker to drive and then off to the docks. Here there is another set of hundreds of employees who move containers around, work on timing of ships getting into port and what containers go where, millions of dollars in cranes and other equipment all specifically made to get things unloaded and reloaded quickly. Then to a vessel, that takes a whole crew to operate, to say nothing of the work that went into designing, and manufacturing it.

Next step is again at a port with the same costs and man power needed as on the other port. Then to a truck which travels a highway infrastructure that literally cost billions of dollars to put into place. And what about the gas it takes for these transportation to move? The mining, refining, and shipping to get it into place.

Then off to the grocery store with all its staff and logistics. And you get that can for what someone on minimum wage can make in less than 10 minutes.

Think for a minute what it would take you to get that pineapple and enjoy it with your family if you lived in Kansas and you had to do it alone? You couldn’t, is possibly the simplest answer but for fun think through it. Step 1 get to the coast. Without the benefits of refined oil, and manufactured machines i.e. a car, this would be very difficult. Step 2 cross the ocean, again on your own this to would be difficult if not impossible. But say your Nephi and built and then voila, a month later you arrive in beautiful Hawaii. Step 3 Plant a pineapple then care for it for 2 years. Step 4 harvest the pineapple. But remember the goal is to enjoy it with your family. So, you have to hope your wife hasn’t remarried in the past 2 years and figure out a way to preserve it why you take your month long journey back to Kansas. I could go on, but you get my point. That is the miracle of capitalism and made possible in large part by specialization. No central planning effort, no matter how good or how long could have possibly gotten you that can of goodness for any cheaper.

What has made it possible?

Mostly the fact that every person has an incentive to maximize profits and economic output. That is the real beauty of capitalism, I have an incentive to get you what you want, the more I get you what you want and need, the more products I can sell, the more money I can make. One of the ways this has been accomplished is specialization. We have become ultra-specialized and are only getting more so with time.

This has led to an amazing and miraculous economy. One that continues to stretch the limits of what economic output can be created. But unfortunately there are down sides. As the quote goes, “Capitalism is the worst economic system, except for all the others.” My next write up will be exploring one of the many limitations of capitalism, specifically specialization, but for now I think I’ll go open a can of pineapple and enjoy it.

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