Brent Wheeler has used economic analysis to drive successful investment and governance in the public and private sector for the last 29 years. Typically with an ........ eye2thelongrun

Avoiding Death by Virus

26th March 2020

One strategy (of numerous possible) for potentially recovering and/or making outsize returns. The approach is strategic but pragmatic and step by step

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The Girl Who Asked Questions - An Obituary

20th March 2020

Katherine Johnson died on February 24th

The black mathematician who guided the first manned spaceflights and the first Moon landing was 101

As she ran her eyes over the flight-test calculation sheets the engineer had given her, Katherine Goble (as she then was) could see there was something wrong with them. The engineer had made an error with a square root. And it was going to be tricky to tell him so. It was her first day on this assignment, when she and another girl had been picked out of the computing pool at the Langley aeronautical laboratory, later part of nasa, to help the all-male Flight Research Unit. But there were other, more significant snags than simply being new.

Most obviously, he was a man and she was a woman. In 1953 women did not question men. They stayed in their place, in this case usually the computing pool, tapping away on their Monroe desktop calculators or filling sheets with figures, she as neatly turned out as all the rest. Men were the grand designers, the engineers; the women were “computers in skirts”, who were handed a set of equations and exhaustively, diligently checked them. Men were not interested in things as small as that.

And, most difficult of all, she was Coloured, and he was White. The lab might be recruiting black mathematicians, but the door was not fully open; her pool was called “Coloured Computing”, and was segregated. As she sat down with the new team that morning, the men next to her had moved away. She was not sure why, but the world was like that, and she refused to be bothered by it. Since the café was segregated, she ate at her desk. There was no Coloured restroom, so she used the White one. A few years back, when the bus taking her to her first teaching job in Marion, Virginia, had crossed the state line from West Virginia, all the blacks had been told to get off and take taxis. She refused until she was asked nicely. But it could be unwise to push a white man too far.

Nonetheless, this engineer’s calculation was wrong. If she did not ask the question, an aircraft might not fly, or might fly and crash. So, very carefully, she asked it. Was it possible that he could have made a mistake? He did not admit it but, by turning the colour of a cough drop, he ceded the point.

She asked more such questions, and they got her noticed. As the weeks passed, the men “forgot” to return her to the pool. Her incessant “Why?” and “How?” made their work sharper. It also challenged them. Why were their calculations of aerodynamic forces so often out? Because they were maths graduates who had forgotten their geometry, whereas she had not; her high-school brilliance at maths had led to special classes on analytic geometry in which she, at 13, had been the only pupil. Why was she not allowed to get her name on a flight-trajectory report when she had done most of the work, filling her data sheets with figures for days? Because women didn’t. That was no answer, so she got her name on the report, the first woman to be so credited. Why was she not allowed into the engineers’ lectures on orbital mechanics and rocket propulsion? Because “the girls don’t go”. Why? Did she not read Aviation Week, like them? She soon became the first woman there.

As nasa’s focus turned from supersonic flight to flights in space, she was therefore deeply involved, though still behind the scenes. This excited her, because if her first love was mathematics—counting everything as a child, from plates to silverware to the number of steps to the church—her second was astronomy, and the uncountable stars. A celestial globe now joined the calculator on her desk. She had to plot the trajectories of spacecraft, developing the launch window and making sure—as soon as humans took off—that the module could get back safely. This involved dozens of equations to calculate, at each moment, which bit of Earth the spacecraft was passing over, making allowances for the tilt of the craft and the rotation of the planet. She ensured that Alan Shepard’s Mercury capsule splashed down where it could be found quickly in 1961, and that John Glenn in 1962 could return safely from his first orbits of the Earth. Indeed, until “the girl”, as he called her (she was 43), had checked the figures by hand against those of the newfangled electronic computer, he refused to go.

That checking took her a day and a half. Later she calculated the timings for the first Moon landing (with the astronauts’ return), and worked on the Space Shuttle. She also devised a method by which astronauts, with one star observation checked against a star chart, could tell where they were. But in the galaxy of space-programme heroes, despite her 33 years in the Flight Research Unit, for a long time she featured nowhere.

It did not trouble her. First, she also had other things to do: raise her three daughters, cook, sew their clothes, care for her sick first husband. Second, she knew in her own mind how good she was—as good as anybody. She could hardly be unaware of it, when she had graduated from high school at 14 and college at 18, expert at all the maths anyone knew how to teach her. But she typically credited the help of other people, especially her father, the smartest man she knew, a farmer and a logger, who could look at any tree and tell how many board-feet he could get out of it; and who had sold the farm and moved the family so that she and her siblings could all get a fine schooling and go to college. And last, at nasa, she had not worked alone. She had been one of around a dozen black women mathematicians who were equally unknown. But when their story emerged in the 21st century, most notably in a book and a film called “Hidden Figures”, she had a nasa building named after her, a shower of honorary doctorates and—the greatest thrill—a kiss from Barack Obama as he presented her, at 96, with the Presidential Medal of Freedom.

This attention was all the more surprising because, for her, the work had been its own reward. She just did her job, enjoying every minute. The struggles of being both black and a woman were shrugged away. Do your best, she always said. Love what you do. Be constantly curious. And learn that it is not dumb to ask a question; it is dumb not to ask it. Not least, because it might lead to the small but significant victory of making a self-proclaimed superior realise he can make a mistake. 

As printed in The Economist February 29th 2020 edition

Valuing a CEO

10th March 2020

There are many who seem to be forever bemoaning the value of CE remuneration. A question for them is whether, based on the following measure, they add the value some highly paid CEs do:

Some, even many, CEOs are overpaid. It is especially galling to see CEOs that lead companies badly still getting paid huge amounts of money.

But some CEOs are very very good. They add value to a company well in excess of their salary. Some people claim once a company is big, then it doesn't matter who the CEO is. But this is clearly not true - look at Steve Jobs with Apple.

Another is Bob Iger at Disney. He become CEO in 2005. The Disney share price since then has gone from $23.80 to $150. It has employed an additional 70,000 people also.

Iger's salary is a staggering $66 million a year. That is around 0.1% of the company's turnover.

But the best way to see how valuable the market sees a CEO is the change in share price when they leave. Iger's resignation saw it drop 2.5%. The net worth is $220 billion so that is $5.5 billion Iger was valued at.

So paying $66 million a year for someone whose value to the company is $5.5 billion seems a pretty good deal.

Hat tip David Farrar, Kiwiblog.

We don’t have money to burn on green mania

27th February 2020

Bjorn Lomborg throws some sense into the pot in this February 2020 article from the Australian.

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Words of Wisdom from Thomas Sowell

26th February 2020

There’s no point blaming the tragedies of socialism on the flaws or corruption of particular leaders. Any system which allows some people to exercise unbridled power over others is an open invitation to abuse, whether that system is called slavery or socialism or something else.

— Thomas Sowell (@ThomasSowell) February 22, 2020

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