When we were first introduced to argumentative writing in school, it didn't take me too long to discover that I had a flair for it. Introduction, point-substantiation, rebuttal, conclusion - I lived and breathed it all.
Back then I had a penchant for uninterrupted smooth-flowing prose - long sentences designed to display an extensive vocabulary, occasionally interrupted by a dash of punctuation melding into the next.
Over the years, this has subtly changed. Elegant as it is, that style detracts from the purpose of the essay: to clearly communicate your points as forcefully as possible.
Greg Mankiw was my inspiration here, especially his guide on How To Write Well. His posts are but a few paragraphs, but each carefully crafted word carries tremendous weight.
Now I continually distill my thoughts before committing them, often over multiple iterations. It's become a game of sorts - to express a point using a minimum of words, while still remaining comprehensible.
Occasionally I turn the game on its head, filtering my audience by providing just enough information that only the nuanced will understand. Language is fun that way.
I'm surprised by how many multi-page essays bloggers still churn out these days. (To be fair, I was guilty once.) No one has time for that.
But the antithesis of Mankiw's writing is what I call Faux Zen: style without substance.
It's amazing how much one can write without actually saying anything. Sure, there's a ton of emotive imagery embedded in the narrative, but to what end? Most of it is just literary masturbation. No one really gives a shit about how the sun is a golden apron pushing between your thighs.
There are no arguments proferred, no evidence presented, just a single continuous narrative that drones on and on.
And that is the crux of it all - by choosing to highlight a personal perspective, the narrative conveniently avoids an informed analysis of the whole. Selected facts are offered to the reader in a vague appeal to emotion. The verbosity of the piece disorients and confuses readers, leaving them vulnerable.
The veil of emotion is so heavy precisely because there is nothing under it. Faux zen.
Saturday, December 14, 2013
Wednesday, December 11, 2013
GM Holden's Australian Closure
Toyota will be next in 2014. At the margin every dollar matters.
Original article at: http://catallaxyfiles.com/2013/12/12/gm-holdens-australian-closure/
By Alan Moran
The soap opera of General Motor’s departure from Australia is ending. The company has been operating with sporadic profitability for a decade and more.
Last year it lost $153 million. This was in spite of it benefiting from the 5 per cent tariff protection on domestic sales and $73 million in government grants, although half of that was for the commercially fruitless pursuit of the green car political ideology.
In recent years, Holden’s products and quality have shown vast improvements from the models sold 15 years ago.
Locally assembled cars have been losing Australian market share. But this is to be expected in a global business that operates an internal market where each area sources models from the most appropriate location. That spells specialisation of products, more imports and more exports.
Holden’s export strength is in the “muscle cars” which have received considerable critical acclaim in the United States. But even then, they were forced to sell at very low profit margins to keep competitive. And US sales, having risen to 30,000 a year prior to the 2008 global financial crisis, have fallen 90 per cent.
Holden Australia has found itself in the wrong market segment with a product whose labour costs and government impositions make it more expensive to build than GM cars in other locations.
It’s the same story with engines. Holden’s V6 line is losing favour and its output is falling below the long-planned 100,000 level. Even within the GM family, the Australian V6 is losing out to similar engines made elsewhere.
Holden’s cost problems are well-known. They do not stem from the company being undercut by cheap third world labour. Even those plants in Europe, Japan and North America, where living standards are similar to ours, operate more productively. Very little of this is due to greater economies of scale overseas.
Holden has become little more than an enterprise run by unions for the benefit of workers and union officials, with lavish employment conditions bringing a crippling cost disadvantage.
One indicator of this is the starting wage for a production line worker: $23.50 an hour in Australia, compared to $14 an hour agreed by unionised plants in the US (even less for non-unionised plants). On top of this, Australian workers get shift penalties and overtime rates, and more than twice the normal weekday rate for Sunday shifts. These and other conditions are unknown in the US and make Australian labour market costs double those elsewhere.
Although labour costs in assembly only comprise 20 per cent of total costs, these are crucial and not irrelevant, as the secretary of the Australian Council of Trade Unions Dave Oliver has argued.
Oliver’s view, shared by so many on the political left, represents a profound misunderstanding of the drivers of business decisions in an interlinked world.
If wages are 20 per cent of costs and double what they might be, this wipes out profitability. Such cost-padding requires a price rise of 12 per cent. Yet the industry faces tight competitive conditions and Australia is integrated into a world market which provides no scope for such a price increase. Hence, the cost must come from profit, which it virtually eliminates.
Similarly, the carbon tax and the renewables requirement add severely to Holden’s woes.
Holden estimated the carbon tax was costing it $45 a vehicle but the total cost of carbon emission measures – including renewable requirements – on assembly and components is much greater.
Compared to its overseas competitors, these imposts might add as much as $600 to the cost of a car. This alone is 5 per cent of the ex-factory costs and halves the firm’s net profit, providing international management a clear pointer about future global capital allocations.
Holden’s Australian management acquiesced to union demands, buying short-term peace at the expense of the strategic loss of value for the company. In part, this was due to the centralised wage-fixing conditions loaded in favour of unions. Management at Holden saw the immediate loss of output from industrial unrest as too great a price to pay. Noting that costs were excessive, they hoped something would turn up, including further subsidies from governments besotted with the idea that a motor vehicle assembly industry was the key to economic well-being.
They had ample justification for thinking this. In addition to subsidies, Labor in Canberra and Adelaide financed numerous consultants’ reports that told a tale of massive employment multipliers and technology gains from motor vehicle assembly. Of course, these were all mythical. Such gains can be counted for every new job, but when the job is financed by taxation, its multiplier additions are offset. If the new job comes out of profits, the future is jeopardised.
Now we have the endgame. Unions face lower revenues from scamming the motor vehicle companies. Workers face much lower wages in alternative jobs – even if these become available.
Original article at: http://catallaxyfiles.com/2013/12/12/gm-holdens-australian-closure/
By Alan Moran
The soap opera of General Motor’s departure from Australia is ending. The company has been operating with sporadic profitability for a decade and more.
Last year it lost $153 million. This was in spite of it benefiting from the 5 per cent tariff protection on domestic sales and $73 million in government grants, although half of that was for the commercially fruitless pursuit of the green car political ideology.
In recent years, Holden’s products and quality have shown vast improvements from the models sold 15 years ago.
Locally assembled cars have been losing Australian market share. But this is to be expected in a global business that operates an internal market where each area sources models from the most appropriate location. That spells specialisation of products, more imports and more exports.
Holden’s export strength is in the “muscle cars” which have received considerable critical acclaim in the United States. But even then, they were forced to sell at very low profit margins to keep competitive. And US sales, having risen to 30,000 a year prior to the 2008 global financial crisis, have fallen 90 per cent.
Holden Australia has found itself in the wrong market segment with a product whose labour costs and government impositions make it more expensive to build than GM cars in other locations.
It’s the same story with engines. Holden’s V6 line is losing favour and its output is falling below the long-planned 100,000 level. Even within the GM family, the Australian V6 is losing out to similar engines made elsewhere.
Holden’s cost problems are well-known. They do not stem from the company being undercut by cheap third world labour. Even those plants in Europe, Japan and North America, where living standards are similar to ours, operate more productively. Very little of this is due to greater economies of scale overseas.
Holden has become little more than an enterprise run by unions for the benefit of workers and union officials, with lavish employment conditions bringing a crippling cost disadvantage.
One indicator of this is the starting wage for a production line worker: $23.50 an hour in Australia, compared to $14 an hour agreed by unionised plants in the US (even less for non-unionised plants). On top of this, Australian workers get shift penalties and overtime rates, and more than twice the normal weekday rate for Sunday shifts. These and other conditions are unknown in the US and make Australian labour market costs double those elsewhere.
Although labour costs in assembly only comprise 20 per cent of total costs, these are crucial and not irrelevant, as the secretary of the Australian Council of Trade Unions Dave Oliver has argued.
Oliver’s view, shared by so many on the political left, represents a profound misunderstanding of the drivers of business decisions in an interlinked world.
If wages are 20 per cent of costs and double what they might be, this wipes out profitability. Such cost-padding requires a price rise of 12 per cent. Yet the industry faces tight competitive conditions and Australia is integrated into a world market which provides no scope for such a price increase. Hence, the cost must come from profit, which it virtually eliminates.
Similarly, the carbon tax and the renewables requirement add severely to Holden’s woes.
Holden estimated the carbon tax was costing it $45 a vehicle but the total cost of carbon emission measures – including renewable requirements – on assembly and components is much greater.
Compared to its overseas competitors, these imposts might add as much as $600 to the cost of a car. This alone is 5 per cent of the ex-factory costs and halves the firm’s net profit, providing international management a clear pointer about future global capital allocations.
Holden’s Australian management acquiesced to union demands, buying short-term peace at the expense of the strategic loss of value for the company. In part, this was due to the centralised wage-fixing conditions loaded in favour of unions. Management at Holden saw the immediate loss of output from industrial unrest as too great a price to pay. Noting that costs were excessive, they hoped something would turn up, including further subsidies from governments besotted with the idea that a motor vehicle assembly industry was the key to economic well-being.
They had ample justification for thinking this. In addition to subsidies, Labor in Canberra and Adelaide financed numerous consultants’ reports that told a tale of massive employment multipliers and technology gains from motor vehicle assembly. Of course, these were all mythical. Such gains can be counted for every new job, but when the job is financed by taxation, its multiplier additions are offset. If the new job comes out of profits, the future is jeopardised.
Now we have the endgame. Unions face lower revenues from scamming the motor vehicle companies. Workers face much lower wages in alternative jobs – even if these become available.
Friday, December 6, 2013
ACA And Narrow Networks
http://marginalrevolution.com/marginalrevolution/2013/12/are-narrow-networks-a-bad-idea-for-health-care.html
1) A sober reminder that the ACA does nothing from a supply-side perspective. Three letters: AMA. Health insurance coverage is not access to healthcare.
2) This was pretty obvious from the start. If the law mandates that certain conditions be covered, premiums will rise. Yet a blatant price change would draw customers' ire. In comparison, reducing health network coverage is much more opaque.
In a similar vein, telcos deliberately offer a wide variety of convoluted plans to make it harder for consumers to effectively choose.
Another example - when the minimum wage rises, firms adjust by working their employees harder, or reducing benefits. There are countless ways to skin a cat - Nature simply finds a new equilibrium.
3) "The simple equation: Insurers say that limiting the size of the network allows them to steer patients to high-quality facilities and doctors".
LOL at the sheer audacity of the spin.
Back in my biker days, there was a well-known mechanic by the name of Ah Koon. Now, Ah Koon might have been an excellent mechanic - or not. But I never got the chance to properly appraise his skills, for the simple reason that once he had established a reputation in the community, he was overwhelmed by the resulting demand.
You literally had to wait 8 hours before he even started working on your bike at all. Imagine what that did for Ah Koon's service standards.
So if the ACA turns out a roaring success as its supporters hope, everything hinges on whether these "narrow networks" have "sufficient capacity" to cater for the increased indigent population.
Quite an oxymoron there. Especially since the main reason for using them is financial.
4) The poor will ALWAYS be worse off than the rich. Whether in a single-payer system like Australia where they suffer long waiting times, poor service standards and outdated facilities, or the magic pudding of the ACA with its narrow networks, they will ALWAYS be worse off.
The chequebook has somehow to balance, the sums somehow add up. Nothing will ever change that.
1) A sober reminder that the ACA does nothing from a supply-side perspective. Three letters: AMA. Health insurance coverage is not access to healthcare.
2) This was pretty obvious from the start. If the law mandates that certain conditions be covered, premiums will rise. Yet a blatant price change would draw customers' ire. In comparison, reducing health network coverage is much more opaque.
In a similar vein, telcos deliberately offer a wide variety of convoluted plans to make it harder for consumers to effectively choose.
Another example - when the minimum wage rises, firms adjust by working their employees harder, or reducing benefits. There are countless ways to skin a cat - Nature simply finds a new equilibrium.
3) "The simple equation: Insurers say that limiting the size of the network allows them to steer patients to high-quality facilities and doctors".
LOL at the sheer audacity of the spin.
Back in my biker days, there was a well-known mechanic by the name of Ah Koon. Now, Ah Koon might have been an excellent mechanic - or not. But I never got the chance to properly appraise his skills, for the simple reason that once he had established a reputation in the community, he was overwhelmed by the resulting demand.
You literally had to wait 8 hours before he even started working on your bike at all. Imagine what that did for Ah Koon's service standards.
So if the ACA turns out a roaring success as its supporters hope, everything hinges on whether these "narrow networks" have "sufficient capacity" to cater for the increased indigent population.
Quite an oxymoron there. Especially since the main reason for using them is financial.
4) The poor will ALWAYS be worse off than the rich. Whether in a single-payer system like Australia where they suffer long waiting times, poor service standards and outdated facilities, or the magic pudding of the ACA with its narrow networks, they will ALWAYS be worse off.
The chequebook has somehow to balance, the sums somehow add up. Nothing will ever change that.
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf"
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
The
simple equation: Insurers say that limiting the size of the network
allows them to steer patients to high-quality facilities and doctors;
participating providers, meanwhile, may agree to price cuts in exchange
for new volumes. - See more at:
http://marginalrevolution.com/#sthash.fDraaWMn.dpuf
Exploring The X Chromosome
http://www.psychologytoday.com/articles/201109/the-incredible-expanding-adventures-the-x-chromosome
Utterly fascinating.
1) So apparently my factory worker Malaysian mum who dropped out from school in Secondary 2 was the genius in the family. Not the father who went to RI.
I have no problems believing that though. She had a very quick mind and a lot more guts.
2) It explains why monarchies have proved to be politically unstable. A capable king doesn't pass on his intelligence to his sons.
3) If the husband is smarter, a daughter would be optimal. And vice versa.
4) It isn't enough for your wife to be intelligent. You'll have to assess her parents and maternal line. Even this doesn't guarantee anything - it merely reduces the odds by a further 50% each generation you go back.
Utterly fascinating.
1) So apparently my factory worker Malaysian mum who dropped out from school in Secondary 2 was the genius in the family. Not the father who went to RI.
I have no problems believing that though. She had a very quick mind and a lot more guts.
2) It explains why monarchies have proved to be politically unstable. A capable king doesn't pass on his intelligence to his sons.
3) If the husband is smarter, a daughter would be optimal. And vice versa.
4) It isn't enough for your wife to be intelligent. You'll have to assess her parents and maternal line. Even this doesn't guarantee anything - it merely reduces the odds by a further 50% each generation you go back.
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