Posts filed under “Current Affairs”

More Proof Of America’s Inadequate Infrastructure

The details are still being sorted out on the deadly Amtrak crash that killed at least six people earlier this week and injured 100s more. But what we do know is that the stretch of track where the train derailed did not have the latest automated speed control system. National Transportation Safety Board (NTSB) board member Robert Sumwalt stated, had the safety system called Positive Train Control (PTC) “been in place, this accident would not have occurred.”

I have frequently addressed the issue of infrastructure spending (see this, this, this, this, this, this and this) as a simple way to improve the standard of living in the United States. But the issue today is about much more than not busting an axle or ruining your set of run flat tires. This is now about basic health and safety.

The NTSB has been pushing for this safety system to be put in place since 1970. That is not a typo, the need for this system has been known for literally 45 years. Following a commuter train(s) head-on collision near Darien, Connecticut, the NTSB began urging the development and implementation of positive train control systems.

The good news is that in 2008, the Rail Safety Improvement Act of 2008 (RSIA) mandated that Positive Train Control (PTC) be implemented across much of the Nation’s rail industry by December 31, 2015.

The bad news is that the train industry, through the Association of American Railroads, has been lobbying against this. The Unions are no better, fighting implementation for fear it will cost jobs.

It is unlikely that the industry will meet the deadline set 7 years ago.

The NTSB has been exhorting the railway industry to implement these accident prevention systems sooner rather than later. It seems that every time there is a rail accident, they call for faster implementation. For example, see

• Fatal N.Y. train crash avoidable with recommended technology (December 10, 2013)

• Train Sped at 82 M.P.H. Ahead of Curve in Fatal Crash (December 2013)

• NTSB: We Need Automatic Braking on All Trains  (January 2014)

• Blue Line crash shows Chicago Transit Authority should update, add safety systems (April 2015)

As USA Today noted 2 years ago, “Since 2005, the NTSB has investigated 15 train accidents in which 50 people were killed and 942 people were injured. In each case, the board concluded that positive train control would have prevented the accident.”

This is not about technology; it is about money and politics. The railroads don’t want to implement RSIA, and have been dragging their feet. Many have been slow to spend the cash installing these systems.

Warren Buffett’s Berkshire Hathaway owns Burlington Northern Santa Fe Railroad.  Last year, they announced a $200 million capital investment to implement positive train control technology. Perhaps Buffett can shame the rest of the industry into getting this done?

I am constantly surprised by the resistance seen on the issue of maintaining, improving, and where necessary, rebuilding our rails, bridges and highways. It reflects a total lack of faith in our own Society. This pessimism has its roots in a unique combination of government failures and a relentless ideologically driven media that never met a worthwhile government project it could like.

64 percent of Americans do not own a passport. These folks should get one – and see how the rest of the planet gets these things done.

Travel to Asia, and you will see a post war infrastructure that has been consistently maintained, modernized and updated. Whether it is roads or airports or traffic control systems or electrical grid, we in the United States are decade or more behind. If Japan and South Korea can do this, why can’t we?

Do you want to discuss the roads in Germany, in the Netherlands, in Italy? Have you seen the bridges in France and Switzerland? That’s before we discuss the trains, the tunnels the mass transit that moves masses of people around so efficiently.

Why can the rest of the world get these things done, but we cannot? 

You can select any one of a number of events that started Congress’ downhill slide in approval ratings to single digits: Vietnam War to Watergate to Stagflation to huge deficits to Clinton’s Impeachment to the Iraq invasion to Katrina to rampant partisanship to NSA Spying. More than the approval ratings, it is the inability to get much of anything accomplished that is so utterly frustrating.

We are the country that created the internet, landed a man on the moon, helped to defeat the Nazis in World War Two, and yes, created an epic interstate highway system. After a half a century, it is still yielding tremendous economic benefits.

There are certain mega-projects that we cannot accomplish as individuals; it is only through a group effort that we can do these things for ourselves. After all, Democracy is people voting for projects that benefit the common good.

If US trains were modernized, if we had autopilots and modern software, if we included the kind of  safety features that other civilized nations enjoy, this exact accident is much less to have likely to have happened.

Bottom line: We have a terrible safety record on across the board. That’s an infrastructure issue.

We tolerate easily preventable crashes, but fear investing in our own future while borrowing rates are the lowest in several generations. We are cowards, but no worries – the magic of the marketplace will have other less annoyingly myopic nations blow by us soon enough.

It’s a shame the electorate does not have a better lobbyist . . .

Category: Current Affairs, Politics, Really, really bad calls, Taxes and Policy

A Pizza Place Closes in Seattle . . .

Barry here: I know Invictus personally for more than a decade. I also know he works at a shop that does not allow its staff to publish economic and data analysis outside of their formal imprimatur. I would not allow his work to be published here if I was not confident about his respect for data, his integrity…Read More

Category: Current Affairs, Data Analysis, Really, really bad calls, Wages & Income

We Know What’s the Matter With Kansas

@TBPInvictus When pushing his tax cuts for Kansas in July 2012, Governor Sam Brownback wrote: “Our new pro-growth tax policy will be like a shot of adrenaline into the heart of the Kansas economy.” Art Laffer and Stephen Moore wrote that “many states like Kansas, Missouri, and Oklahoma are seriously considering abolishing their income taxes…Read More

Category: Current Affairs, Data Analysis, Economy, Politics, Really, really bad calls

Jobless in Seattle? Not Yet, Anyway. Part 2

@TBPInvictus On Wednesday, I threw in my $0.02 about the controversy surrounding the increase in Seattle’s minimum wage. Unlike any of those who have been decrying the new law and its impact, I used some data to demonstrate the absence (as yet) of any ill effects. Specifically, I looked at restaurant permit issuance and found…Read More

Category: Current Affairs, Data Analysis, Economy, Employment, Really, really bad calls

Jobless in Seattle? Not Yet, Anyway.

@TBPInvictus Barry wrote yesterday about how political bias can corrupt economic analysis. It’s something he and I discuss all the time and are always on the lookout for. We’ve documented over the years how leaning too heavily on one’s politics is a recipe for disaster when it comes to asset management. In the wealth management…Read More

Category: Current Affairs, Data Analysis, Economy, Employment, Really, really bad calls

The Not So Friendly Skies

@TBPInvictus I’m excited about, the website that is currently being sued by United Airlines and Orbitz for enabling “hidden city ticketing” (which you should read up on before continuing). I needed to travel to Cincinnati last spring. During a period in which my plans were tentative, round-trip fares were in the mid-$300 range or…Read More

Category: Consumer Spending, Current Affairs, Really, really bad calls, Travel, Web/Tech

Art Cashin: 2015 Issues to Watch

I am never a fan of forecasts, but I am interested in an informed discussion from knowledgeable people like Art Cashin who have have a half of a century experience on the NYSE floor:

Category: Current Affairs, Investing, Video

Rapidly Changing Social Attitudes

Fascinating comparison of popular acceptance of non-traditional (in some jurisdictions, they were called “Deviant”) marraiges. Note how the slopes of the lines showing legality and popular acceptance have shifted. Not just change, but the rate of change has accelerated. This suggests to me a more progressive attitude on Social Issues. Add Marijuana legalization to the…Read More

Category: Current Affairs, Digital Media, Legal, Psychology

Here is What I Am Watching, Lately

Every few months, I like to pull together an assortment of unrelated items that I find interesting (See this). These items include things that are not quite fully baked in my mind, not yet a full column. While I wait for these to jell, I like to put them on paper to create a bookmark…Read More

Category: Current Affairs, Markets

About That Labor Force Participation Rate . . .

@TBPInvictus here: On April 17, 2012, North Carolina Congresswoman Virginia Foxx stood before her colleagues in the House of Representatives and said (emphasis mine): Ms. FOXX. Mr. Speaker, the March employment report continues to show us that the Federal Government has not been helping to create jobs in our economy. A Wall Street Journal editorial…Read More

Category: Current Affairs, Cycles, Data Analysis, Economy, Employment, Politics