Saturday, July 31, 2010

Krugman wants to talk deflationary spirals

Like this one

How else do we deflate?   If Krugman thinks we can go through a restructuring without a deflation, then he is wrong.  When the distribution network for goods needs an adjustment, the way we do it is to find the maximum subgraph, go back to that point, and then we what grows from there.  If Krugman does not like the way mammals do this, then become a lizard, no problem.

Tuesday, July 27, 2010

Bounded Rationality

Krugman wants us to figure it out.  I suspect that Bounded Rationality can be modeled by assuming each agent suffers a constant uncertainty, he/she accept decisions within the uncertainty range, neither more certain nor less certain.  If that is the case, then economic production, modeled in macro, is a Shannon Channel with Gaussian noise equal to the uncertainty constant.  Or course, everything that leads from that should be called Quantum Economics, because the set of equilibrium points is finite.  Thus is explained the inflated and deflated states of the economy, the encoding process for production, and the sudden non-linear change from one stable state to another, as well as Ramsey searches for the equilibrium conditions of any production network.  Then we must include entropy norms into production systems, because equalizing a Shannon Channel is like compression of information, an entropy process.

Technology substituting for labor

That is what we see when unemployment seems structural this depression.  The stimulus crowd has it wrong, the more burden we see from government activities, the more intense is our search for technology substitutes for labor.  Technology development is a costly pain in the ass, but when we need new technology to increase productivity we develop the new technology.  Technology is not a fixed stream of resources.

Monday, July 26, 2010

I should be a TrailerBot salesman

The lowest cost trailerbot is the little electric garden bot that follows you around the garden. It has GPS and DSRC, but so does I, in my hand held. Larger trailer bots around the construction site are hybrid powered, but still can be limited to wireless and GPS.

So, with the hand held, I can guide my trailer bot up snug against a wall, even with no vision system! Just cheap electronics and a great little four wheeled flat bed, self propelled with control by wire. This works great for plastering walls. These utility bots can use hard plastic body, lowering cost and weight.

I class the trailer bot into a separate group based on its driving rules. Trailer bot is always under the control of a human. So, like any other piece of industrial equipment, it really doesn't need vision or collision avoidance.


A garden bot can be had for a few hundred. The thing will find its own sopecial recharging outlet. The bots go up in price all the way up to a hundred grand for heavy loaded trailer bots on the highway.

E mail me, tell me how many and what size.

Each CPU is blocked from public roads, using an internal GPS hard wired map. unless its program is checksummed by human hands, periodically.  Thus, these bots can guarantee digital protection from uses as terrorist bombs in public places.

Goldman Sachs predicts a multiplier for local and state government

From Business Insider:

What will the effect be over the next year? We believe it will be around ¾ percentage point, i.e. similar to the last year. This is based on the same reasoning as our July 2009 analysis, and it is illustrated in the third column of the table near the beginning of this comment.

As explained in yesterday’s daily comment, we no longer expect Congress to extend FMAP. Hence, there is up to $15 billion or so of budgeted funds that may not materialize. This implies required budget cuts in a range of $89bn-$104bn, or 0.6%-0.7% of GDP, almost precisely the same numbers as we found a year ago for fiscal 2010.

So, a .65 increase in state spending yields a .75 increase in GDP, a multiplier of .75/.65 = 1.15; a multiplier greater than one.
Yet multipliers we get from Congressional spending are coming in at .7 and below. John Taylor at Stanford watches these numbers.

How can state spending, with all its corrupt public sector unions, have a higher multiplier than Congress? Because Congress is raising entitlement promises much faster than the government sector can support. So crowding out of state government is happening faster than bankruptcy from public sector unions.

The question then becomes, can technology and automation arrive at state and local government in time to stop the bankruptcies? For schools, web technology will dramatically lower the cost of education for diligent students. This is happening today. In transportation, local governments have a vital role to play. If local governments bite the bullet and deploy congestion pricing and automation, then there is hope.

Saturday, July 24, 2010

Great research

By Chad Syverson of Chicago on the effects of e commerce in different sectors:
Those that are able to operate at low cost (and pass some of this cost advantage on to their customers) can gain market share and profitability, while higher-cost firms will be hurt, perhaps fatally. 

Don't get caught in a small business that is easily dis-intermediated by the web.

Programming the Autobot, for example

We could easily solve most of the problem with R code, using my 150 Essentials.  That package could handle the graph matching, search finding, feature fusing requirements of the autobot brain, and comes with an SQL embedded sensor storage.  I can also get XML parsers with that menu, so I can take a rule set in XML, displayable to humans, and parse it into a driving rule through the maize of object measurements, all measurements of objects in a 2D finite array. We get closer to the idea of defining the entire measurement grammar with XML, especially the messaging between smart sensors and the Navigator.

We could even crack the stereo vision problem in R.

Most of the Navigation Logic software I have seen assumes finite sized grid squares, mostly distinct objects per grid.    So, starting with my 150 Essentials, which you can cut and paste, off we go to redefine the American transportation grid.

I have actually done this two times in my software career, many software engineers capable of it.  But, a huge jump in the number of transportation planners needed occurs, because the autobots multiply the number of lot_size*frequency settings available to the economy.  The chain gets another bit of precision, the entire job chain goes as NlogN, as the quant size supported drops.  Total channel capacity to the inner cities and metropolitan areas goes up as NlogN, I think.

If Obama wants a short term boost, medium term boost and long term boost to the economy, then he should tell the software engineers to read my blog.  A number of jobs should be coming up very soon.

Choo Choo Trains don't work for LA commuters

From Tim Cavanaugh's California Roundup:
* If you build it for $8 billion, they won't come. L.A. Times' Dan Weikel explains how the Los Angeles Metropolitan Transit Authority is actually carrying fewer people now than it did when it began its light rail building project 20 years ago. More than a million people a day ride buses in the county, a little more than 300,000 ride trains, and the figure for trains keeps falling. (I used to keep a close watch on these numbers, and it looks like the trend has been holding for almost ten years now: rail boardings decline a little almost every quarter, regardless of economic activity, gas price, or efforts to promote train ridership.) Transit gadfly Tom Rubin estimates the massive rail project has cost the MTA 1.5 billion potential passengers since 1986. Don't miss the comment section, where trainspotters are still saying the trains will be full once they have one that goes all the way to the ocean.

Some cities tried to go back to older technology in the 30's depression, building rail when the market screamed roads.

China thinks we are Greece and other economics

* Washington's blog reports on the Chinese revulsion syndrome.
* Krugman accuses the Bush Republicans of damned Communism (my words).
* Meanwhile, Chinese local governments are busy defaulting.
* Barlett thinks we suffer slow money:
the economy’s fundamental problem is a decline in velocity
 Sounds like bad paper all around!

Friday, July 23, 2010

Good luck on Newark's budget cuts

Fox reports:

It's part of Newark Mayor Cory Booker's belt-tightening plans that include reducing most city workers to a 4-day work week and shuttering city pools.  Booker estimates that the pool closures alone would save $250,000.  He also says that no gas will be purchased for municipal vehicles that are not deemed critically important.
Police officers, firefighters and sanitation workers would not be affected by the furlough plan. City workers were already bracing for furloughs starting in August. The number of unpaid days would increase from 11 to 19 with Booker's plan.

When we have a limited amount of money for government, and Pelosi steals it all then local government takes the hit.

Here is Mish talking about the Bell California issue (where elected officials ripped off the taxpayers for salaries as much as $750,000/year)

Can Anything Be Done?

This is all so outrageous it is hard to know exactly where to start. Yet, once again corrupt politicians and unwarranted public pension promises are right at the heart of the issue.

These people are supposed to be public servants but they have raped city taxpayers, and worse yet will continue to rape taxpayers for as long as they live unless and until a means is available to claw back pension benefits.

One way would be for the city to file bankruptcy, another way would be for the city or state to tax public pension benefits exceeding say $50,000 at an enormous, progressive rate topping at 100% for benefits in excess of $100,000.

So we can see why the unions are trying to outlaw municipal bankruptcies.  It is the only weapon that poor voters have.

Evictions on the rise in California

Fresno and the central valley anyway.  Mostly tenants cannot pay rent because unemployment hovers at 20%.  The rent they can pay just barely covers the pension costs, 1/4 of the county budget, and businesses are leaving the area.


Krugman wants evidence

Jean-Claude Trichet, quoted by Krugman,  says:
In extraordinary times, the economy may be close to non-linear phenomena such as a rapid deterioration of confidence among broad constituencies of households, enterprises, savers and investors. My understanding is that an overwhelming majority of industrial countries are now in those uncharted waters, where confidence is potentially at stake. Consolidation is a must in such circumstances.
Paul wants evidence of sudden non-linearities.  I have evidence for Paul, the crash of July, 2008.  In mid-July, there was a sudden non-linear desire to quit driving cars with gas at $4.50.  Since then the bond vigilantes have been carefully working with OPEC to manage our oil supplies so that bonds are protected.

Thursday, July 22, 2010

I have besmirched Anonymous people

My habit of posting as Anon has gotten Anonymous people a bad reputation  over the blogosphere.  To all Anonymous people, you have been besmirched and I am sorry.

Google to run an innovation webinar

Guests only

The Google claim is that they are going to use technology to reach the lower rung of the poverty ladder.  If they are going to do that with a  secret webinar, then the open software community would like in on the secret, because we are awfully busy working on the Robocars at the moment.  We plan to reduce the transportation costs of getting good stuff to the lower rungs of the ladder, and not sure why Google would make secret webinars about the topic.

But for those still confused that they need a secret google webinar, let me give you the summary:  We are going to make transportation work like the web.

Baltic Dry Index: Looking bad

Houston, We have a problem

The Baltic Dry index measures global shipping and is a great leading indicator for international trade.  Use it like the Ceridian index for the domestic economy.  The BDI is headed down and is now just above Double Dip territory.

HT to the madhedgefundtrader on Zero Hedge who points out the problem

Joe Gagnon is wrong

Bernanke cannot change the monetary policy, only OPEC can.  If we took Joe's advice, then oil imports will restrict further and OPEC will enforce what Joe will not, energy efficiency.  The economy is headed to one place, energy efficiency.  The economy will deflate, inflate or stand still as necessary to make sure it happens.

Wednesday, July 21, 2010

Steam Powered Rotary Press, Clipper Ships and General Gluts

Brad DeLong should know, these are related items.
The new information technology allowed information to be distributed in detail over the globe.  Heavy goods had to await the clipper sjhip.  But they all knew this in those days, it made sense to pause and produce the clippers, because it was the small, passenger clippers that were shipping the news.

Tuesday, July 20, 2010

Higher inflation won't work

Recent posts have talked about zero bound and inflation rates.  We cannot cure some symptoms with inflation. Here is why.

The welfare function of the firm or household is optimum when common mode price changes are hedged with long term assets.

For example, house prices are a hedge against inflation.  The more we predict inflation the more we invest in housing.  Hence, when oil became constrained, oil inflation was reflected in house prices.

Looking at orthogonalization we can see that as square intagrable systems trend toward equilibrium, the terms along any yield curve will decorrelate, moving common mode signals to the right, toward long term inventory.

Spectral characteristics, important in constrained systems.  Global oil distribution determines our inflation rate, not an aggregate basket, because we are constrained by a single, essential good.  So the assets/liability sheets of OPEC countries are optimum at zero inflation.

Robocars, Driver's License, XML

Three things that mix. The robocar industry can define a specification for a generic robot driving rule set. The XML formatting language, the functional version of HTML, is designed just for that, and can reformat the rule set to look like a driver's manual. In other words, our instructions for a particular robocar on the streets will be from a web page like thing.

Typical Diagram from the California Driver's handbook
Web designers can look at any DMV driver's manual and immediately see definitions that could make a set of web pages illustrating driving rules. Most of the rules involve two dimensional zone s around the robocar, with predicates on those zones. With this definition we can define rules for all the bots, and restrict their behavior based on these rules. Simultaneously we give manufacturers a design goal.

It must ultimately be guaranteed by periodic, out of channel,  human intervention and hardware CRC checks.  It can be done. The software chain for public streets being enforced by mandated GPS location receiver. 

I still argue for location based link layer addressing in DSRC.

Milton Freidman: To spend is to tax?

Not quite. I have covered the Supply and Demand issue (To Tax more is to spend less). Lets look from an equilibrium point of view.

If government spending leads to serfdom, then existing taxes may very well pay for an economy that delivers much less; government promises turning to cheaper scrap. Alternatively, more spending may lead to higher GDP growth, in which case we are happy to pay the cost and still come out ahead. It depends upon the equilibrium conditions of the moment.

In our situation, every extra dollar of government spending reduces the private sector economy by more than a dollar, so future investment in the private sector is dimmed and borrowing costs for government drop.

What makes Uncle Milt correct again is that we have not operated with Congressional multipliers less than one for any long length of time, we eventually return to growth and technology.

Texas seeks second place in the Bankrupt State contest

Dave Mann at the Observer reports:
It’s come to this: The Texas budget outlook has become so bleak that we’re comparing rather favorably to the one state where balanced budgeting goes to die.

People, our budget deficit is now as bad as California’s.

Yes, the over-spending, over-regulated capital of hippiedom now has a state fiscal outlook on par with the Lone Star State.

Government is allocated a relatively fixed slice of the economy, and the Bush/Obama team soaked up a good deal of government resources, in favor of central government; leaving the states hanging by a thread.

Can Bruce Bartlett save the Republican Party?

He is trying, and is willing to justifiably criticize lil Bush.  I think he gets the connection between low taxes and strangulating central government.   His problem is that the wealthy, who pushed the government spending have left the barn without paying for the purchase; and took the capital with them.  He has a tough job, and the voters have a hard time distinguishing between the damage caused by Obama and that caused by Bush.

I would vote for the Bartlett wing of the Republican party, I wish he could bring the Tea Party with him.   The proper model is the Bill Clinton/Gingrich model, split government.  Each of the extreme wings of either party is a disaster, but put  together we can force enforce the middle.  It is Depression until November.

Peter Suderman at Reason also gets the problem, and a big HT from Instapundit for posting Peter's article, quoting:
Gridlock may offer the best possible solution—the surpluses of the Clinton years came as Washington started arguing more and spending less—but if this sort of pandering and evasion is what the GOP has to offer, it’s probably worth asking: How long can you gripe about deficits without being willing to even talk about possible specific ways to reduce them? A number of Senate Republicans seem determined to help us find out.

Except that Suderman misses the crucial connection, we cannot get split government until the Bush tax cuts expire. We only get gridlock when its in the interests of the wealthy, then we get economic boom. The tax cuts are set to expire on Dec 31, but the election is Nov. Progressives and Conservatives may band together to save Big Government; and prolong the Depression another two years.

Monday, July 19, 2010

I rely on Ydiot

To interpret Yglesias and the Progressive Alliance for Jumbled Thinking that he represents.  There is simply no continuity of thought among the Progressive Theory, it is make things up as they go along, like Conservative Republicans.

So, to get the proper Yglesias interpretation, we are better off going to this site:

Alan Binder has trouble with Supply and Demand

He is quoted by the Levi Institute:
Let the upper-income tax cuts expire on schedule at year end. That would save the government an estimated $75 billion over the next two years. However, it would also diminish aggregate demand a bit. So, instead of using the $75 billion to reduce the deficit, spend it on unemployment benefits, food stamps and the like for two years. That would surely put more spending into the economy than the tax hike takes out, thus creating jobs.
For 30 years we have studied and reported on the effects of taxes on Congressional spending.  We have a name for the theory, the law of supply and demand.  When taxes increase, we will get less spending, you can bet me on that, say $100?  I am open to terms.

New businesses can't find opportunity

Reports Emmeline Zhao from Real Time Economics:
The activity of new entrepreneurs plunged in the first half of 2010, falling to the lowest rate in more than two decades as more workers found employment or were driven away from start-ups by a feeble economy.
Start-up activity fell to an average 3.7% in the first two quarters of this year, down from 7.6% in the first half of 2009 and 9.6% in the second half, according to a survey of about 3,000 job seekers by global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc. Many of those surveyed are former managers and executives.

I blame crowding out by Congress.

Economists don't like simple explanations

I think it ruins their pride when problems are not explained with complexity.  The Money Market Theorists want to have a complicated scheme to manage printing presses, Keynesians want to demonstrate their knowledge of mass psychology.

It is mostly nonsense, here is how it works in reality:

About a year and a half ago, OPEC decided to set the quantity of oil delivered to maintain an oil price of $75/barrel, measured in Dollars.  They have been successful because the quantity they deliver for this price is reasonably stable and oil is the constrained resource in the American economy. 

That is how OPEC sets our inflation rate and our dollar trade value, by setting oil imports.  They also determine the efficiency of energy use because if energy is used inefficiently, the quantity supplied drops and the economy stalls.  Nothing any American economist says will change that, except for methods to increase energy efficiency.  It has been this way since  Oct 2008 and will remain this way until one or more groups of nations obtain significantly higher energy efficiency through better technology.

There are no bond vigilantes because OPEC is performing the task for them.  Remember, OPEC holds a huge swath of assets from oil importing nations and OPEC will protect its investment.

Sunday, July 18, 2010

John Taylor at Stanford cannot find a stimulus effect

He has some graphs here.  Take a look, but here is a key summary:.

The two charts show the percentage contribution of investment and government purchases to real GDP growth in the first quarter and in the preceding quarters since 2007. The charts clearly indicate that the changes in real GDP growth have been mostly due to changes in investment and little to changes in government purchases

He compares government spending and investment spending and matches those spending trends against GDP growth trend. That is a good technique, and government spending definitely comes out with multipliers less than one.

So much for the idea of more stimulus, unless we get a stimulus that actually targets the constraint.

If we want to debase the currency, then be prepared to debase oil imports

No wiggle Room between nominal and real oil prices

Large swings in oil prices make planning impossible and cause us to contract. Said in other words: As long as real and nominal oil prices remain tight, then OPEC is free to set the value of the dollar.

Saturday, July 17, 2010

How much federal spending can we handle?

Seems to be a big question among economists who think economic growth must come from Congress.  Let's look at Federal spending divided by personal income:

The Clinton administration left office with federal spending equal to 22% of personal income.  Bush, the Communist, ran it up to 24%, and now Obama and his Keynesians have it at 30%.  Have we hit the limit?  Krugman says no, but the states are bankrupt, their taxpayers are disappearing.  California pays something like 7% for 30 yr bonds.  California is Greece, so says the Gubinator.  We have reached the limit.

Krugman calls this a Depression

One of a series of three depressions, the Long of 1870, the Great of 1930 and this one.  Where have we heard that before? Oh yes, this blog for about two years.

Well, I suggested two years ago we call this the Mini Depression.  What do all these depressions have in common? Information technology drives us to adopt better transportation grids.  I would call this the Mini depression because we have very little infrastructure to build, we simply have to provide digital controls to the asphalt roads we have.  The Great depression was great because we needed 500,000 miles of roads to overcome the technology shock of commercial radio.

I further suggest that we define a Depression to be a transformation of the transportation grid.

Don't count on it

Traffic Technology reports:
Working with the US Department of Transportation, Lockheed Martin will refine and validate the requirements and architecture for the new IntelliDrive communications infrastructure, which will ultimately permit safety and traffic systems to communicate. This 15-month contract is valued at approximately US$2.6 million.

IntelliDrive is a multimodal initiative that aims to enable safe, interoperable networked wireless communications among vehicles, the infrastructure, and passengers’ personal communications devices.

“This program leverages our extensive experience in developing wireless network architectures,” said Jim Quinn, vice president with Lockheed Martin’s Information Systems and Global Solutions-Defense. “We look forward to helping the DOT establish a new vision of preventative vehicle safety and mobility within the United States.”
 Government is better off funding an Open Source consortium.  Lockheed has zero experience with civilian wireless networks.  They have likely already spent the $1.5 million and will plan on coming back for lots more, and little will result.

To the Open Source community.  We need to move forward with an Open Source implementation of Navigation Logic for the autobots.  Suggest we usurp this Lockheed contract, and contact Jim Quinn and force him on board an Open Source version of the Black Box.  Like this effort described in the Linux Journal.

Federal Purchase Order for Black Boxes

Gov dot biz
The Federal Highway Administration (FHWA) has a requirement for the development and production of aftermarket devices to use in vehicles for generating "Here I Am" messages to other vehicles and other devices. These devices will support vehicle to vehicle (V2V) and vehicle to infrastructure (V2I) safety communications capability. The devices will produce dedicated short range communications at 5.9 GHz.

Friday, July 16, 2010

Dave Obey spent a trillion on mass psychotherapy

From a fiscal Times interview with Dave Obey:
And then [White House Chief of Staff] Rahm Emanuel said to me, "Geez, do you really think we can afford to come in with a package that big, isn’t it going to scare people?" I said, "Rahm, you will need that shock value so that people understand just how serious this problem is."
Mass psychotherapy from Congressional politicians?  No wonder multipliers are less than one.  I doubt that Keynes ever consulted with a psychotherapist, which would be Freud in his later years during the 1930s.  I suspect Freud would not have recommended shock, and I know it never works with cow herds.

Economists are nuts.  Politicians will believe anything that lets them spend money.

Krugman chimes in on the debate, claiming that a Congress which is spending money at  13% YoY growth is going to shock the masses into productive work?   Wrong psychotherapy, and neither Keynes nor Krugman have anything approaching a theory of mass psychology.  When an economists does not get psychology then the economists should stick to the truth, which in Krugman's case is that we were Stranded in Suburbia.

Bringing up another point.  What Freud would have said is that the first impulse, as in Stranded in Suburbia, is generally the correct impulse because the first impulse generally sneaks past the defense mechanisms.

The market is doing the 'W' again

The old double dip.

A comment from Scott Sumner

From a recent post:

Commenters frequently ask me what would be the point of higher inflation expectations.  Doesn’t the rational expectations model imply that only unanticipated inflation has real effects?  Yes and no.  As far back as the late 1970s people like Fisher had already shown that in a new Keynesian ratex model with sticky prices, monetary policy could still influence real variables.  For this to happen, the monetary shock must occur after some wage or price decisions have already been made, but before those wages and prices are scheduled to be re-adjusted.

We have a word for this concept, fraud.

Thursday, July 15, 2010

Economic Cycles

Yield Curve over Time

I see them.  Isn't there a cycle with a 30 year time constant?  I say these cycles are physical transit times of real goods over the US geo-economy,. that actual asymmetrical tree of distributions  mostly over US territory. Or can be modeled like that, a finite semi-directed, minimum spanning tree.
Aside from the model, what is the interpretation? My interpretation is that the longest time constant is the time for central US government to exhaust inventory in pursuit of bail outs. The piling on is expected in asymmetric graphs.

The price we pay for bailouts is productivity improvements, no one likes them.  But, central government got us here, and central government is going to pay the price of productivity improvements.

Technology to the rescue.  We will have an abundant flow of new, cheap productivity technology for 50 years.

Yes, the Fed can flatten the Treasury yield curve, for a moment

Menzie points us to a paper by Chris Neely on the effect of Fed bond purchases.  I also noticed that the two year rate is also the lowest in history, as Mish noticed.  So the curve reverts back to steepness within the uncertainty interval of finance.  Overall, we earn less now when we invest.  If the Fed is causing the overall curve to drop in yields, well, that is a multiplier less than one.

We want the curve to get a bit flatter with yields higher on each end. We probably need to do something with the real economy.

Trailerbot technology

How does a self propelled flat trailer follow the owner's car through town?

When I want to move a load of sand out to the farm with my Prius, the first step is to back up to my trailerbot and signal it Ready to Go.  The little trailer will follow me through town, to the nursery for a load of sand, then out to my little Suburban Farm.  How does that work?

License plate reader technology, mostly.  The little trailer looks at the license plate on my Prius and keeps that plat at the perfect three feet using geometry, simple.  The little "trailer that could" can also communicates with my Prius using Dedicated Short Range Communications, and so it knows when I am braking or accelerating.  This is all yesterday's technology.

Where can you buy a Trailerbot?  Coming soon, late this year.

Randall O'Toole and traffic automation

Taking the Driver Out of the Car
Why robocars, and not high-speed rail, could revolutionize transportation in the next decade

'Your grandchildren will snap across the entire continent in 24 hours on a new kind of highway and in a new kind of driverless car that is controlled by the push of a button," futurist Norman Bel Geddes promised in 1940. Mr. Bel Geddes designed Futurama, the most popular exhibit at the 1939 New York World's Fair, which in many ways inspired the construction of the Interstate Highway System.
Driverless cars have so far remained the stuff of science fiction. Seventy years after Mr. Bel Geddes's promise, they are finally close to reality.
Consumers today can buy cars that steer themselves; accelerate and brake to maintain a safe driving distance from cars ahead; and detect and avoid collisions with other cars on all sides. Making them completely driverless will involve little more than a software upgrade.
Yet the potential for advanced personal mobility is being ignored in debates over surface transportation. These debates come to a head every six years, when Congress hashes out how to spend federal gas tax revenues. Congress has increasingly diverted the funds—$40 billion a year by last count—from highways to transit.
The Obama administration and House Transportation Committee Chairman James Oberstar (D., Minn.) want to go even further in the next reauthorization, now scheduled for 2011. The administration has focused on a new national high-speed rail system, as well as streetcars, light rail and other projects, to reduce driving and congestion.
Yet driverless cars could render the hand-wringing over roads versus rail needless. Driverless technologies were demonstrated in 1997 on a California freeway when eight cars without drivers successfully operated just one car length apart at 65 miles per hour. In 2007, six cars negotiated the Defense Advanced Research Projects Agency Urban Challenge, following all traffic rules in an urban environment with other vehicles.
Volkswagen says enhanced global positioning systems can keep cars within two centimeters of their desired location on streets and highways. This summer, the company will demonstrate its technology by running a driverless Audi at racing speeds up the twisty Pikes Peak road.
At the 2007 event, General Motors vice president of research Lawrence Burns predicted that completely driverless cars would be on the market by 2018. He added that the primary obstacles were legal and bureaucratic, not technological.
Driverless vehicles offer huge advantages over current autos. Because computer reaction times are faster, driverless cars can safely operate more closely together, potentially tripling highway throughput. This will virtually eliminate congestion and reduce the need for new road construction.
Toyota's recent recalls naturally lead to worries that computer glitches could cause serious accidents. Since each car will be independently controlled, a failure in one would simply lead others to avoid that car. Modern cars already have numerous built-in computers that do things, such as anti-lock braking, far more reliably than humans, even those who are not texting or inebriated. Any serious problems could be quickly corrected through wireless software upgrades.
Driverless cars and trucks will be safer. They will also be greener, first by significantly reducing congestion, and eventually because vehicles will be lighter in weight due to reduced collision risks.
Perhaps most important, driverless vehicles will bring mobility to everyone, not just those able to pass a driver's test. While many people will still choose to own a car, increased numbers may rely on car sharing. Outside of ultra-high-density areas such as Manhattan, driverless cars will render urban transit and intercity passenger trains even more obsolete than they are today.
The American automobile fleet turns over every 18 years, so if Mr. Burns's prediction that driverless cars will hit the market by 2018 comes true, we could have a completely driverless system by 2036. State highway officials could accelerate this timetable by working with auto manufacturers to set standards and a transition path. State and local highway agencies could install wireless communication systems at major intersections and highways—a much less costly undertaking than building new roads, much less high-speed rail.

Chicago drivers warm up to congestion pricing

Road pricing and associated technologies yield gains in efficiency. From the Tribune, Richard Wronski reports:
A 2007 report by the planning council estimated the Chicago region loses $7.3 billion a year in wasted time, fuel and environmental damage. The report also found that Chicago-area drivers spend an average of 2 1/2 days stuck in traffic each year.

Truckers on the Illinois Tollway already use congestion pricing because they get a discount for traveling during off-peak hours.

Tuesday, July 13, 2010

I am back

I had a gig and went quiet for a while.  But work is over and back to blogging, more later.